Goods Dominant Thinking still resides in this Lean Manufacturer
I have addressed many Lean Manufacturers through the years about applying Lean to Sales and Marketing, and the truth is that it has been a dismal journey to say the least. The areas of software and services mixed with Lean Startup and Agile principles seem to take to what I call Lean Sales and Marketing like a duck to water. However, there seems to be a huge disconnect with Lean Manufacturers.
I am not alone in this type of thinking. With Toyota Kata, service and software companies seem more prepared for Kata Thinking. I struggle to apply Kata to manufacturing. It may go back to the way Lean was introduced to manufacturing. Lean was a method of waste reduction and making operations effective and efficient. When applying Lean to Sales and Marketing and even to Services, we have a tendency to approach things the same way. It is tough to teach a dog old tricks.
I also think that most manufacturers whether their Lean or not, still think in that Goods (Product) Dominant Logic (GD-Logic) model versus Service Dominant Logic (SD-Logic). You can read a quick snippet about it in this blog post, Best Stories About Value Are About Users. The shorter version is that GD-Logic focuses on the thought of value derived at the point of transaction and SD-Logic focuses on the thought of value derived at the point of use.
I have written about all of this at numerous times and for many years but today, I experienced a very Lean GD-Logic type of sales approach. It was from a well-established Lean company and witnessing it first-hand was truly interesting.
We live in an older Villaminium that needs new windows. We contacted several window suppliers and was contacted very quickly by all of them and we set up several appointments. I wish to compare a few of them and as an indicator of my buying habits, I have seldom gone with the lowest bid on practically any project. I shop, but I end doing business with whom I feel the most comfortable with if pricing is somewhat comparable. I sell value in my business life and attempt to practice what I preach.
I am familiar with a particular Lean window manufacturer and believe my last house had a boat load of them. I had good success and would be willing to pay a reasonable premium. However, my existing windows are named brand and have lasted 25 years, so beating them up as many windows companies have done carries little weight with me.
The Lean Manufacturer appointment was set at 8:00 AM so that all the decision makers would be available. It was emphasized several times that we would get a price at the appointment and that the price would be guaranteed for a year. The day before the appointment, there was a follow-up, and again there was an emphasis on all decision makers being there….starting to smell right. But they are trying to be effective and efficient.
The day of the appointment the salesperson shows up 5 minutes earlier and goes around the house and measures the windows. We chat with him discussing colors and options. He sits down and goes over all the other types of window’s manufactured with miniature samples emphasizing the deficiencies of each type. He then demonstrates their window that you can only get a renewal window, he says, not sold in new housing. It is special to them only, and their patent ensures that they will have the best product for many years to come. He goes through the manufacturing again with miniature samples and gives me a tablet to see the bullet points he is covering in his presentation. It has to be the most effective and efficient sales proposal that I have experienced in a long time. The sales guy knows his stuff and when we interject different stories, he listens intently, but does not respond directly to them and moves on to his presentation. In one of the stories, I mention how someone had tried to strong-arm me into a closing bonus when I was selling and how I had walked away from the deal. He smiles, laughs and proceeds through his script efficiently and without hesitation.
At the end of the presentation, he says just a minute, and I will have your quote. He then says, there is a closing discount if you sign immediately that I could pass on to you. We mention that I have other appointments that I have committed to and have to get the association to approve the construction before signing. Again, he listens and goes about his business. Within minutes if not sooner he gives us a price that is just slightly higher than other comparable quotes. He is after all selling us a premium product. We ask if the closing bonus is included. He tells us it is, and it is approximately 25% off the “normal” price. We mention our previous objections, and he says that though he could adjust it some but the deal needs to be done now to get a lion share of the discount if any. We thanked him for his time and showed him the door.
From my perspective, it was GD-Logic thinking because the entire presentation was centered around making it effective and efficient for the manufacturer. It was based on transactional thinking where the value to the manufacturer was at the point of transaction, and they were going to control that point. It had little if any empathy for the other needs, outside of the window, of the customer. Our needs were brought up during the conversation, which though the salesperson was certainly bright enough to understand, I think he had an outline he was forced to follow. It was a best practice thing, I presume.
This salesman missed several key points.
- We needed to validate what he had told us, even though we were misled thinking that the price was guaranteed for a year. I guess he assumes the brand was strong enough to overcome this.
- I told him of a dealing far larger than this that I walked from. He had to know that my behavior indicated he could not close with a strong offer.
- We needed to get the approval from the association. He presented no option for us if the board declined our request.
- As far as waiting for other appointments, he completely neglected and simply did not care I felt a commitment to other contractors.
- The manufacturer through the whole process had brought up price would be guaranteed for 1-year. Even to a point of slighting the competition. In actuality, the closing bonus was over 20% of the price, It really was a take it or or leave it proposition.
With just a little flexibility and putting yourself for a moment in the customer’s shoes, this company had a prime opportunity to get the deal. The problem was, though the presentation was well orchestrated, we were left with a take it or leave it proposition. This type of approach may work on a fair amount of buyers, I do think he mumbled (Boren’s First Law: When in doubt, mumble) something as he was ushered to the door about his close rate. We really did not care. I wondered how this type of approach, shows any respect for a customer. Our issues were obvious as we went through the conversation. Even though he listened, he did not demonstrate any type of empathy for any of them.
I think this goes back to this institutionalized or manufactured type of sales approach. I think it goes back to why Lean has not been successful at most Lean manufacturers. Is this the way Lean should be applied to Sales and Marketing? Should sales be made effective and efficient for the manufacturer? Should a “close” be more important than the customer’s needs? Am I asking too much from a window salesperson? Am I asking too much from a respected Lean company?