Build a market-focused organization

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The following are some of the main contents of Professor Law.

Close to frontline staff and customers

I was doing research in India last week and a young CEO accompanied me to A manufacturing company visited, the CEO asked an old worker: What are your thoughts on the improvement of our organization? Hearing this question, the old employee cried. The CEO didn't understand, and the old worker replied, I have worked here for 30 years. During these 30 years, everyone thought that I was a person with two hands and no brains. You are by far the first boss who respects me, thinks I'm smart, and he sheds happy tears.

No matter how large and complex an organization is, even the smallest screw has great ideas for organizational improvement.

Two years ago I went to Chicago to teach some top executives. One person said, I joined a well-known auto company in Detroit after my MBA. I did a good job. The company gave me a car, and later I was promoted. The company gave me free gas. He was later promoted to senior vice president with a driver. Didn't I say it's good? He said that the problem is that all the vice presidents of our company are completely out of the market. understood.

Why the top managers of Japanese brand cars run around the big supermarket all day long to see how ordinary drivers use their cars, desperately taking pictures on the front line. They understand that they don't know what's going on in the market if they don't focus their wisdom from the bottom, the front line. If you always stand at the peak, you will be deprived of oxygen.

The top executives don't have insight into the general market, so why can't they understand the needs of customers at the lowest level? I just learned a Chinese vocabulary, this Chinese vocabulary explains the reason, because the people around me are "flattering".

So to really build a market-centric organization, you must first reach the lowest-level employees and your customers, and secondly prevent some people from flattering you.

The following is a case study of Neiman Marcus, a department store in the United States, which is a high-end company. It has four main categories of customers. One is fashionistas, the second is people who come from afar, the third is tourists, and the last is people who only come to buy discounted products.

Neiman has a store at Stanford College and another in San Francisco, 30 miles apart. How many of these two stores sell the same thing? 28%. 30 miles away, 28% similarity, what does it mean? Because the store in San Francisco is really close to fashionable people for sightseeing, while the other store is mostly blue-collar workers from the IT industry, there are more tourists in San Francisco, and San Francisco is a foggy city, and the other store is located in the whole place. The sun is shining brightly. So if it's a shirt, maybe the materials are the same high-end, but the colors of the two cities are very different. You can see how sensitive and subtle this store is to the needs of customers.

In order to be market-oriented, it is very important to segment customers again and again, not from the point of view of merchants, but from the point of view of customers.

Neiman wants to surprise customers. How do they do this? Neiman has a core value. If customers feel unhappy with the purchase of this item, it will be an unsuccessful sale for Neiman. The same values apply to the attitude towards employees. Only when employees come to work happily can Neiman feel that the right person has been chosen.

Let's take a look at how it enforces these values.

Who has the smallest office in Neiman? Is the general manager. Why is his office the smallest? He spends a lot of time in stores greeting customers, and he trains employees. All employees receive 200 hours of training every year, and about one hour of standard training for one employee every two days. Who trains it? Is the general manager. This general manager also has to do one more thing: go to a nearby place every week, arrange free cars, pick up customers to visit the store, and encourage these customers to come and see.

How do they hire people? When choosing a person, it is not for the job, but for the brand.

The job of the Neiman salesperson is paramount, and the general manager's job is to support him. Salespeople are actually empowered. He would have a dedicated trade book with a list of clients that the salesperson was supposed to own.

But here's an interesting thing, who buys the items in the store? If the purchasing staff makes the order and the sales staff sells, how can the two departments be combined? They first have the purchasing staff formulate a list of forecast targets, such as how many products will be sold at the original price, how many products will be 20% off, and how many products will be 40% off. Purchasing personnel have to make such predictions. If the prediction is wrong, the purchasing personnel's commission will be deducted. Therefore, the purchasing staff will actively communicate with the sales staff to see which products sell better.

What are the criteria for designing a job? Enterprises will make a lot of processes, but you have to look at the problem from the customer's point of view. For example, in a 7-11 (Seven Eleven) convenience store, the cashier has a duty to remember two characteristics of each customer, the first is male or female, and the second is what age group the customer is. Two years ago, Seven Eleven became the biggest selling company of Japanese stockings, and everyone was surprised. After discovering this, the general manager said, we can become the biggest seller of stockings and the biggest seller of lipsticks. But when they looked into who was buying the stockings, they found that it was mostly men in their 40s and 50s.

Further analysis found that all Seven Elevens in Japan are next to the subway. In Japan, men are mainly working, and they all commute by subway. The sales records show that the stockings were bought at 7 or 8 in the evening. Because my husband received a call from his wife on the subway, he went to Seven Eleven to buy me a pair of stockings. The general manager is a smart person. He said yes, I don't sell lipstick anymore, what should I do? I'll put the stockings next to the beer. That's what very smart companies do. Their approach is to simplify complex things.

Let's talk about the reward and punishment mechanism. Most companies have complicated rules and regulations. I think it should be very simple. I understand that for most companies, any idea or concept that cannot be understood by an 8-year-old is not a good plan.

If you want to become a market-centered organization, you generally think about four points: Product, Price, Place, and Promotion. Are these four "Ps" enough? To realize the experience of this brand for customers, there is a fifth "P", that is, people.

Let's discuss how to describe a market-focused organization. I'm emphasizing the entire target market here, not all your current customers.

The core philosophy of a market-focused organization is the ability to understand, attract, and retain large customers. To do this, we must first have a customer-oriented culture. At the same time, it is also necessary to have a shared information database, not the kind of computer information database, but a very simple and easy-to-use information sharing. For example, there are tens of thousands of employees in Wal-Mart in the United States, and many employees know Ms. James, who is this lady Woolen cloth? Very typical Walmart customer. What would such a typical customer do? Go shopping every Saturday and Sunday and spend hundreds of dollars. What good would it be if every Walmart employee knew about Ms. James? The benefit of this is that employees can be more proactive. For example, when oil prices in the United States rise, Ms. James' consumption will be affected. For example, she originally sold four shirts in one pack, but when oil prices rise, she may have to sell two shirts in one pack.

In a market-focused organization, everyone knows what's important to customers, what they care about, and what they don't. In a market-focused organization, everyone knows what's disgusting. This is where Walmart excels. When it comes to Ms. James, everyone knows three things that will make her angry. They are all very simple and easy to understand. If you send employees a market report of more than 30 pages, who will read it?

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Customer-focused innovation mechanism

We mainly help you to further study the process of innovation and how it works.

Let's watch a video that talks about an innovative process. In the video, an innovative team from the famous design company IDEO spent 5 days working together to design a brand-new supermarket shopping cart, making it more convenient and functional.

As you can see from the video, in this team, everyone is equal, there is no boss and employee. The first thing the team did was find the people who were using these carts and understand what they thought of the carts. They go deep into the front line to take pictures and observe, pay attention, observe, not directly ask customers.

When everyone comes back, they will show, communicate, and share what they have learned from their field trips. This is IDEO's unique way of brainstorming, they call it Deep Dive. It must be ensured that every employee can be heard from all quarters. Have one conversation at a time, listen to the person, don't make premature judgments, and encourage a variety of ideas.

Everyone talks about what functions their shopping cart can fulfill. There are many, many ideas. It is a state of confusion, but it is a state of focused confusion. Hundreds of ideas have been put forward, and they are posted on the wall. Start voting. Not only do you vote for cool-sounding ideas, but also for actionable and cool ideas.

Then, they have to design some prototypes based on their ideas, and they try to bring together some of the advantages that people have come up with. IDEO company has a philosophy, try to fail, and fail more to succeed. Many people pursue virtual perfection and forget to allow a process of continuous innovation. The shopping cart made by turns of discussion is not perfect, but it is indeed much better than before.

The process may seem messy, but there are actually some rules and they have their own set of methods. The organizational structure is flat, with a very diverse mix of teams that are small and small. Whether a person is respected or not, status comes not from position, but from how creative he is, and the culture is very playful, not so serious.

In the entire design process, 60% of the time is spent communicating with the front-line, customers, and users, so they understand the customer's problems very well.

The customer-centric realization process goes like this: understand, observe, conceive forecast, build model, evaluate and refine, produce.

This process applies not only to manufacturing products, but also to your company's structure, compensation, incentives, and performance appraisals. You can use this process to innovate.

Another point to emphasize is that innovation often means failure, because to innovate is to keep trying, and if you don't try, there will never be a successful innovation. The earlier you fail, the lower the cost; the later you fail, the higher the cost.

In the early days of MTV, the CEO fired some managers because they didn't fail enough. Why fire someone like that? Because they try less and fail less means they try less.

Here are the main ways I've listed IDEO's innovations: don't rush to judgement; encourage novel ideas; develop other people's ideas; don't stray; have one conversation at a time;

I emphasize the penultimate point, visualization, visualization. In addition, I want to emphasize that if you have innovative projects, you should put the old and the new together, and put the optimistic and the complaining people together. It is necessary to put old experts and novices together, because experts know where there are limitations, but newcomers do not know this limitation. At the same time, newcomers need to have the courage and willingness to challenge the elderly. The quality of the elderly is to be patient and listen to newcomers.

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Exercising collective wisdom

When I consult with senior managers, I often don't care what their decision is, I just ask them, what process did you use to make this decision, they say we vote democratically, Be careful then, there is a good chance that democratic voting will result in the wrong decision. To manage collective intelligence, one must avoid hasty votes. How did they do it in the IDEO movie I watched this morning? Everyone has equal time to speak, to finish their thoughts, list them all on the wall, and then vote. It's just a team, what about an organization with a few hundred people?

Let me introduce another case.

This company is called Wright Solutions. The CEO and COO of this company told me that we are not the smartest people in the company. Our job is to The collective intelligence in the company is unleashed.

McKinsey & Company conducted a survey on innovation, surveyed more than 2,000 people in different industries, from CEOs to front-line staff, all participated in the survey. When asked what drives innovation, the first thing they often say is the assessment mechanism Drive innovation.

I think ideas, ideas, and creativity are more important than mechanisms and systems. You have a lot of evaluation mechanisms, but probably not creative. Where does the idea come from? Not just by observing customers, but also by an environment. The environment should encourage risk, encourage experimentation, and encourage knowledge sharing.

The Wright Company that I introduce to you, their important approach is to democratize the process of innovation, and they can effectively execute it. Effective implementation must select a few good ideas for everyone to implement, which means having to reject and kill many ideas. How do you shoot these ideas without curbing people's creativity? How to kill creativity without killing the people who generate it?

The Wright Company solved the problem. The main business of this company is computer video production, and there are two customer groups, one is the US Navy, which provides video processing solutions for the US Navy, and the other is the casino, which provides video processing solutions for casinos. The company's approach is to create a so-called stock market within the company, and each employee has $10,000 in seed money to buy stocks. There are three types of stocks, (that is, three types of ideas), the first is the savings bond type, which can reduce the cost of the company; the second is the Dow Jones, which refers to the ideas proposed to existing customers. Solutions; the third is called Nasdaq, which is to explore new solutions for new customer groups.

What does the participation of all employees mean? They may contribute ideas, participate in discussions, or volunteer their time to support. It's even possible to find out who's the best employees at this company, who's coming up with ideas, who's volunteering support for others, and who's making supportive suggestions.

Once any idea or corresponding project is sold and commercialized, the person who created the idea will be rewarded accordingly. For example, a colleague proposed an idea, another colleague implemented the idea through computer coding, and finally more money was given to the colleague who supported the project and did the coding work. The operation of this company has been very good.

The key point here is transparency. Everyone knows every idea, every stock is publicly listed, and all ideas are open and transparent to everyone. Some companies collect ideas through the president's mailbox, which is a single, peer-to-peer model.

I asked the CEO of Wright & Company, what was your role in this process? He said my job is to choose the best people.

What does Wright's case show us? An innovative company knows how to generate choices and execute creative ideas, and in order to achieve this requires the will, the ideas, and the tools.

How does this project guarantee willingness? Is getting rewarded the main source of motivation? Sometimes innovation doesn't necessarily pay off financially. Happiness is what really matters. The internal stock market provides a tool to foster a willingness to innovate, to give people an emotional boost, to make employees feel safe, and to fail with impunity. The most important thing is to be happy, which is what drives the emotional aspect. In addition to emotion, there is another dimension to consider, which is willingness. These employees ask whether they ask themselves questions, share or not share their ideas, whether they are willing to take risks, and whether they exchange ideas with each other and learn from each other. This is a kind of will.

In Wright's company, people feel safe. Safety is my ideas and thoughts. No one laughs at me. Playing this game is fun and makes people feel confident. Once you have a new idea, there will be a lot of action, some people will borrow your idea, and various activities will be carried out in the market.

This tool from this company mobilizes everyone to evaluate and simplify all kinds of ideas, so that those involved feel safe, happy, and confident.

At one meeting I heard a speaker say that our employees' brains are like paratroopers. When is a paratrooper's parachute bag most useful, it is only useful when it is opened. This is the problem faced by the company. Everyone's head is an umbrella bag. Our task is to open the parachute. This is what I call unleashing collective intelligence.