Three Fundamental Lessons
In the opening scenes of Stanley Kubrick’s 2001 A Space Odyssey we see what is labelled as the dawn of civilisation. We see a group of primitive apes living as a loose community, hunting for food and drinking from a waterhole. If they were the only inhabitants of that area the situation would have remained stable. They squabble amongst themselves over food and this natural process of competition creates the ‘leader’ concept. In the next scene we see another group of apes encroaching on ‘their’ waterhole and we see the two groups fight but with no overall conclusion. Then we witness another encounter but this by time one of the apes has learnt that the additional leverage of his arm plus an animal bone gives him greater power he has, and his group have, a ‘tool’ and in this encounter they club the other group’s leader to death, rendering them victorious and therefore winning control of the waterhole and survival. Of course in the film this advancement in learning is implied to be down to the monolith they discover, but that’s another debate.
There are 3 fundamental lessons here:
- We have to compete for resources to survive
- Although people want to do the right thing, without a leader a group of people do not have sufficient pull in one direction
- A tool gives us a competitive advantage over another party who simply don’t have the tool and this in conjunction with #2 allows us an advantage for #1
A Lens to look at History
Look at these 3 lessons and use them as a lens to look at the history of the human race. The leader of a group evolved to be the leader of a tribe then a territory and ultimately a country. Without leaders the social and economic frameworks that society depends on to survive would not have been able to evolve. The vector sum of human endeavour would not have moved in any one direction it would have been like ‘Brownian Motion’, lots of small, individual groups deciding something but never succeeding in pulling together in one direction.
This is how options for running a country evolved, originally tribes would have fought and maybe combined if they could align their ideas, tribal leaders became Kings and ran countries as a huge tribe. As groups under the control of one leader become larger the members of the group get a greater degree of freedom and they start to dissent, effectively starting up new tribes or resurrecting old tribes to overthrow the ruling King. Thus we get revolutions, changes in leadership of a country and changes in priority and direction. Of course there is an outcome where a powerful leader of a country or region relentlessly squashes any sign of dissent a form of leadership which we have labeled ‘dictatorship’. To stay in control such a regime typically ends up doing things that the rest of the world find unsavoury but locally this is the only way they they can retain control. Then there is the more moderate approach of a ‘democracy’ where the leader is elected by the people, for the people. This moderates extreme change because if the leadership of a party moves the country in a direction that the majority don’t like then there is a ‘revolution’ of the vote and another party gets in for a term. The net result is less change and long term stability through moderation but no real change.
How does all of this relate to Business?
People are inherently good, everybody wants to to a good job but does it sometimes feel that not everyone in your business is pulling in the same direction?
It really depends on the quality of ‘your leadership’ and the clarity of the business strategy that ‘you’ communicate. In this sense the business is a tribal gathering, you are the leader and you are competing with other businesses for resources (waterholes) to survive and grow but in this case the resource you are competing for is market share.
Businesses exist primarily to make money for shareholders and they have an inherent need to grow to retain investment. The fundamental way that this is achieved is by providing a service or a product, that improves other peoples lives to the extent that they are willing to exchange goods or pay money (tokens) to get it.
But why should anyone pick your product or service over your competitors? Only 3 reasons:
- Unwavering brand loyalty
- Unquestionably superior product or service
- Product or service is not differentiated but it represents unprecedented value for money
We find ourselves navigating an economy where many markets that have traditionally been buoyant are suppressed, the ‘waterholes’ are drying up and the competition for resource to survive is increasing. Some of the weaker businesses have already fallen by the wayside and even the traditionally strong businesses find themselves weakened and looking for new ways to gain market share and survive through the next winter.
There is an interesting dynamic in a downturn. If you look at my 3 points above, consider the 3rd reason, ‘A product or service that represents unprecedented value for money’. The companies offering these tend not to fare so well in a downturn and there are perhaps a couple of reasons for this:
- They tend to operate on narrow margins to get their prices down and this is all predicated on volume. When the sales volume goes down, margins are eroded and the business can quickly implode and simply disappear.
- People change their buying strategy ‘to buy once and buy the best’ they can afford, they want something which lasts. Witness that luxury brands tend to do well in a downturn. Maybe there is a ‘feel good’ dynamic at play as well.
So we are left with only ‘Unwavering brand loyalty’ or ‘unquestionably superior product or service’.
The Restaurant Experience
Now I want you to think about eating out in a restaurant. When you go for a meal you may be drawn by a brand, or a chain, since this typically gives us the experience of consistency, we know what to expect, we know the menu, we know the environment and we know the price. This chain could be anything from ‘fast food’ to ‘famous chef’.
In other posts I have written about people’s general reluctance for change, it is a basic instinct for us to steer away from something new even though we detest routine we feel comfortable and safe with things we know. Whether we opt for a brand or chain we go to the restaurant and our customer experience starts from the moment we walk through the door, we remember exactly how:
- we are greeted
- we are shown to a table
- we are seated and offered a menu, the menu contents (since we abhor change we look for one of our favourites)
- we are offered something while we make our menu selection which may be as simple as bread and a jug or bottle of water
We are already forming an impression of the experience before we even get our food!
Now here is the interesting thing, if the service and the environment is really good but the food is ok but not outstanding, i.e. not positively discriminated we will still enjoy the experience, we will still tip and we will probably go back and we will recommend it to our friends.
By contrast if the food is exceptionally good but the service is aloof or simply not outstanding we are unlikely to tip as much and we will tell our friends about the poor service.
So what does this tell us? It is possible to gain market share by differentiating on ‘service’ easier than by differentiation on ‘product’.
To achieve this type of success our business simply has to think about service excellence and the ‘end-to-end’ customer experience. The key here is ‘end-to-end’.
If your business offers a service the chances are you have multiple service providers underneath the ‘veneer’ of consistency of your business. For service excellence you need to make the joins between the service providers appear seamless, you need a unified experience and to achieve this your service providers have to work under your ‘badge’, their parent companies ‘badges’ have to be suppressed or made of secondary importance. If not your service will exhibit ‘gaps’ and ‘overlaps’ and your customer experience will be negatively impacted.
A new approach – ‘UniTeam’
What are the obstacles to a seamless customer experience that will give your business the differentiation it needs?
One way of bringing this to fruition is to form a ‘fabric of collaboration’ between your suppliers such that they each realise that short term gain will not bring enduring success. As we have seen, it is human nature to compete for resources and each of your providers or suppliers wants a bigger market share and they will fight with their neighbouring supplier over scope and territory but it is your job as the leader of your business to unite these suppliers (tribes) under a single unifying vision for success which will benefit them and you long term, which will give them and you reliable and enduring business because ‘your success is their success’.
The ‘One Team’ approach can transform your supply chain to become coherent resulting in increased effectiveness and cost efficiency. The increased focus on customer experience drives your performance and reputation which increases market share driving both revenue and profitability.
To find out more about ‘One Team’ and how you could use it to help your business gain market share through positive discrimination on seamless service read my other related posts:
- Why Collaboration is Difficult
- The Recipe for HyperTeams
- How to Make the Service Integrator Model Really Work