The Referral Engine: A book review by Bob Morris

The Referral Engine: Teaching Your Business to Market Itself 
John Jantsch
Portfolio/Penguin Group (2012)

First, you must be (or become) worthy of the referrals you seek.

Whatever their source of power (e.g. wind, water, coal, nuclear fission), the most effective engines throughout human history share common attributes: they are well-designed and conscientiously maintained. Moreover, whenever appropriate, they are modified to accommodate the requirements of changed circumstances. For example, steam power enabled British coal companies to remove water from their mines, then remove and transport coal to mills from which steel was transported to harbors at which steam-power ships delivered it to other harbors.

John Jantsch makes brilliant use of the engine metaphor when explaining how to formulate a strategy that drives a system that “compels customers and partners to voluntarily participate in marketing, to create positive buzz about the given products and services to friends, neighbors, and colleagues.” In other words, to create or increase demand for whatever is offered by including within its marketing initiatives the active involvement of what Ben McConnell and Jackie Huba characterize as ”customer evangelists.” The “referral engine” really is a process rather than a mechanism. Despite what this book’s subtitle claims, no business can be “taught to market itself” any more than a piano can be “taught to play Bach.” However, as Jantsch explains, an organization’s leaders can devise and then execute the aforementioned strategy.

He cites five (actually six) of the realities to be accommodated: People male referrals because they need to (“We rate and refer as a form of survival, and, to build our own form of social currency”), All business involves risk (hence the importance of “a trust-building approach to marketing”), Nobody talks about boring businesses (“And you’re probably boring on purpose” to play it safe), Consistency builds trust (“Commitment to a remarkable difference demonstrates that yours is not a gimmick”), and Marketing is a system (However, “there is no one system that works for everyone”; actually, there is another, the most tragic referral reality of all: “How can a business owner know that word of mouth is so powerful and then do so little to take advantage of it?”

These are among the dozens of passages that caught my eye, also listed to suggest the scope of Jantsch’s coverage.

o Staff as customer, and, Hire for fit (15-18)
o A culture of buzz (23-24)
o Meet the Four Cs of marketing (33-37)
o An expended view of collaboration (49-53)
o Fulfilling the promise (63-66)
o Visualizing the ideal customer (73-76)
o Referral brand elements ( 80-82)
o The secret sauce: TIHWDIH
o Note: This is how we do it here (83-84)
o Your strategy action plan (90-91)
o Content is the most trusted form of advertising (101-103)
o Your content action plan (114-115)
o Hidden benefits of blogging (126-128)
o A social media system example, and, Your convergence action plan (144-147)
o The ultimate measure of marketing success (160-161)
o How to activate your network (179-183)

With meticulous care, John Jantsch presents a framework – beginning with a set-up of [the aforementioned] realities – a set of overarching strategies, high- and low-tech engagement tools, and a methodology for finding the perfect culture of referral in almost any organization, whatever its size and nature may be. That said, he adds, “the ideal referral system, based on a strategy that gets people voluntarily talking about your business, can eliminate the need to ever actually ask for referrals again.” Meanwhile, this book will help you to craft such a strategy so that your employers, friends, and neighbors as well as customers become your ”evangelists.”

The Power of Why: A book review by Bob Morris

The Power of Why: Breaking Out in a Competitive Marketplace
Richard Weylman
New Harvest (April 2013)

Why you must keep asking “Why?” until you understand why

In his book Begin with Why, Simon Sinek asserts — and I agree — that individuals as well as organizations must have a crystal clear sense of purpose or it will be very difficult (if not impossible) for them to decide what to do and how to do it. If they have the right purpose, it will guide and inform their decisions and, meanwhile, inspire and then sustain their efforts. Sinek suggests that the Golden Circle [i.e. beginning with WHY at the center, then proceeding to determine HOW to produce WHAT] “helps us to understand why we do what we do. [It] provides compelling evidence of how much more we can
achieve if we remind ourselves to start everything we do by asking why.”

Richard Weylman fully agrees. In fact, he wrote this book to help business leaders to answer the most important “why” questions and solve the most serious problems so that they and their companies can break out in a competitive marketplace. “That’s our goal here: to elevate your business performance and presence so that you are the best and only choice for your product and services — regardless of your geographic footprint or your vertical or target markets.”

Early on, Weylman poses three important questions for his reader to consider:

1. “Why are your customers buying from you right now?”
2. “Are your customers staying with you or shopping around, and if the latter, why?”
3. “What is it about your competition’s relationship to their customers that you haven’t figured out yet? Why are they so successful?”

Having obtained preliminary answers, the reader can then take full advantage of the wealth of information, insights, and counsel that Weylman provides to help her or his organization become much more customer-centric. Only then, with a much better understanding of customer perceptions and expectations, can the organization complete the difficult process of breaking out in its marketplace, differentiating itself with a competitive advantage whose nature and extent will be determined by the nature and extent of its customer centricity.

Breakthrough initiatives require results-driven leadership. “Now let’s plunge into nitty-gritty, the best practices I’ve developed from years of consultation and experience in the field, what I call the rules of engagement for having your customers define your Unique Value Promise. There are eight “rules” and Weylman discusses each in an extended passage, Pages 42-53. They are best revealed within the narrative, in context. I also presume to suggest that you consider what Fred Reichheld characterizes as “the ultimate question,” one that can be asked of all customers to determine your organization’s Net Promoter Score (NPS). Customers who give the highest ratings would be those you ask to evaluate your organization‘s Unique Value Promise. Of equal importance, their responses will suggest which modifications of it (if any) need to be made.

These are among the dozens of other passages that caught my eye, also listed to suggest the range of Weylman’s coverage:

o The Value of Our Preliminary Answers (Pages 5-8)
o The Obvious Answer Is Not the Answer (15-17)
o How Customers React to a Unique Value Promise (30-32)
o Forward Thinking Firms That Use Unique Value Promises (33-38)
o Developing a Promise-Driven Team (63-65)
o The Importance of Well-Planned Promotion Is Obvious (77-79)
o Personalizing Your Unique Value Promise (80-82)
o Little Things That Make a Big Difference (84-92)
o Finding Out What People Really Want (105-106)
o Moving from Discovery to Disclosure (110-114)
o The Keys to Brilliant Advantage-Based Selling (116-117)
o Revisiting Fundamentals (124-132)

Also noteworthy are the four mini-case studies that Weylman includes: “The Upscale Financial Firm” that requested to remain anonymous, Kelron Logistics, The Mount Paran Church, and The Conklin Company (Pages 136-150). The “do’s and don’ts” lessons to be learned from these real-world situations — as well as those described in Chapter 3 (Pages 33-38) — are relevant to almost all other organizations, whatever their size and nature may be. Readers will also appreciate Weylman’s skillful use of various “Action Points” in Chapters 2-9 that serve as a self-diagnostic while suggesting how to apply whichever insights and recommendations are most relevant to the reader’s own needs, interests, concerns, resources, and strategic goals.

Before concluding his book, Richard Weylan reiterates that the #1 objective is “never again blend in. To sustain your breaking away from the pack in a competitive marketplace, it’s essential that you elevate your service and customer interactions so that you no longer just have satisfied clients. but delighted advocates instead,” what Ben McConnell and Jackie Huba characterize as “customer evangelists.” I’ll take them one step further and suggest that most of the companies annually ranked among the most highly regarded and best to work for are also among those annually ranked the most profitable with the greatest cap value in their respective industries. Why? Because they hire, develop, and retain “employee evangelists” who are purpose-driven.

All For One: A book review by Bob Morris

All For One: 10 Strategies for Building Trusted Client Partnerships
Andrew Sobel
John Wiley & Sons (2009)

“Unus pro omnibus, omnes pro uno”

Those who have read the novel, Three Musketeers, already know that its author, Alexander Dumas pere, took advantage of every appropriate opportunity to have his principal characters (d’Artagnan and his friends Athos, Porthos, and Aramis) proclaim “One for all, all for one!” Andrew Sobel had that motto in mind when selecting a title for this book because it is in this same spirit of solidarity and comradeship that he introduces and then explains ten strategies “for building trusted client partners,” for creating what Ben McConnell and Jackie Huba characterize as “customer evangelists.” In an exceptionally informative Introduction, Sobel briefly acknowledges six important trends and pressures that should guide and inform relationship-building strategies, briefly reviews three epochs of client relationships, and then provides a “quick sampling” of several practices (e. g. enhancing dialogue with clients exemplified by Bain & Company and customizing the relationship experience exemplified by WPP) that he will examine when presenting ten strategies for building what he characterizes as “trusted client partnerships.”

Sobel carefully organizes the material that follows within four Parts: First he presents case studies of two “extraordinarily successful trusted client partnerships” and defines the six levels of professional relationships before summarizes the aforementioned ten strategies; next, he rigorously examines the first five strategies that are primarily (not exclusively) the responsibility of an individual professional; then he rigorously examines the second five strategies that are institutional and require specific commitment and support of senior management; and finally, he poses and answers the 17 most commonly asked questions about how to build long-term client relationships. This is a clever idea because the Q&As enable him to review key points after completing his narrative; also, Part IV facilitates, indeed expedites frequent review by his readers later.

At this point in the review, it seems appropriate to share two questions I always ask when meeting with a prospective consulting client to discuss its client relationships: “How many `customer evangelists’ does your company now have?” and then a separate but related question, “How many of your other customers are not `customer evangelists’…but COULD be?” Presumably Sobel agrees with me that in many (most?) companies, there is a tendency (albeit unintentional) to take customers for granted, to neglect them, with the inevitable results that (a) there is less frequent direct contact, (b) a diminished understanding of their needs (especially unmet needs) and concerns, and (c) increased vulnerability to competitor initiatives. None of this would happen if the relationships were “trusted client partnerships” that are steadfast but resilient and mutually beneficial. Hence the importance of executing strategies such as those Sobel recommends.

After identifying the components of trusted client partnerships, he devotes almost all of his attention to explaining how to establish and then sustain those relationships, with “sustain” obviously a key consideration and objective. What impressed me especially as I worked my way through this book is that Sobel combines the skills of a cultural anthropologist with those of a raconteur. He anchors his observations and insights in real-world situations, citing exemplary companies such as Environmental Resources Management (ERM), Bain & Company, Citigroup’s Global Corporate Bank, IBM, Towers Perrin, Cognizant, WPP, and Eden McCallum. Better yet, he does so with a focus on the impact of each strategy on human interaction. Insofar as customer relationships are concerned, Sobel is a pragmatist with an insatiable curiosity to understand what works, what doesn’t, and why.

Previously, I referred to the six levels of professional relationships. They form a progression that begins with Contact (initial encounter with prospective client), followed in order by Acquaintance (preliminary exchange of information), Expert (establishing credibility), Vendor or Steady Supplier (incremental increase of involvement), Trusted Advisor (differentiation from others in terms of judgment), and Trusted Partner. How to know when you have reached this highest level, Level 6? He provides his answer on Page 21 and explains on the next page how a client would probably view each of the six levels.

Readers will especially appreciate Sobel’s provision of specific recommendations with regard to how to become a Trusted Partner. For example, with regard to the first five strategies: Becoming an Agenda Starter (Pages 49-51), Developing Relationship Capital (Pages 64-76), Engaging New Clients (“Listening Pitfalls” are listed on Pages 100-101 and suggestions for “Getting to Know Clients as People” are provided on Pages 104-105), Institutionalizing Client Relationships (“Pathways to Growth” are listed on Pages 114-115 followed by best practices for activating each on Pages 115-1129), and Adding Multiple Layers of Value (“Foundations of Value” are examined on Pages 134-136).

Sobel also offers provides specific recommendations with regard to how to use effectively each of the other five strategies, presumably with the full commitment and sufficient support by senior management. The generous provision of advice continues in Part IV as Sobel presents 17 Q&As (Pages 267-294), sharing his thoughts about how to make regular investments in client relationships, four ways of staying in touch with clients, what needs to be emphasized during the relationship-building process, and how to use “traffic building” activities that build a professional brand and create an inquiry stream from prospective clients.

Empowered: A book review by Bob Morris

Empowerment: Unleash Your Employees, Energize Your Customers, and Transform Your Business
Josh Bernoff and Ted Schadler
Harvard Business Press (2010)

Many years ago, Southwest Airlines’ then chairman and CEO, Herb Kelleher, explained his company’s competitive advantage: “Our people. We take really good care of them, they take really good care of our customers, and then our customers take really good care of our shareholders.” I recalled those comments as I began to read this book in which Josh Bernoff and Ted Schadler explain how to create what Ben McConnell and Jackie Huba characterize as “customer evangelists” by first creating “highly empowered and resourceful operatives: HEROes for short.”

To a much greater extent than at any prior time that I can recall, customers today are self-directed, and, yes, self-empowered. They have instant access to more and better sources of information about just anything they may be thinking about purchasing. Moreover, they have more and better choices re when, where, and how to make a purchase. It is imperative, therefore, that everyone who interacts with a customer be empowered (i.e. have the authority) to make whatever decision and/or take whatever action may be necessary to solve a customer’s problem or in some other way provide whatever assistance a customer may need.

Most of the material in this book consists of information, insights, and advice that, Bernoff and Schadler fervently hope, will help business leaders to empower employees, to develop and then support HERoes. In most of the organizations with which I have been associated, however, senior-level executives tend not to see themselves as “employees”; moreover, they are reluctant to empower those whom they do view as employees. (I wish I had a dollar for every time I heard one of the C-Suiters refer to non-executives as “them.”) Of course, as they clearly indicate in their book, Bernoff and Schadler fully understand how difficult it will be for many of their readers to become change agents in a company “at the start of the journey toward empowering [its] HERoes.”

What to do? Here is what they suggest: “First, spend some time learning how mobile, video, cloud, and social technologies work…Second, don’t just identify customer problems, imagine solutions…Third, reach out to people who can help…Fourth, build a plan [such as the Effort-Value Evaluation in Chapter 2]…If your project affects customers or employees, you’ll generally need some management approval – but you’ll have to balance the need to get approvals higher up in the organization with the ability to get started.”

Bob Morris on Design-Driven Innovation: A Book Review

Design-Driven Innovation: Changing the Rules of Competition by Radically Innovating What Things Mean
Roberto Verganti
Harvard Business Press (2009)

Does design drive innovation or does innovation drive design. The answer is “Yes.” The success of each approach depends almost entirely on what Roberto Verganti characterizes as “radical research” and those who either conduct it or support those who do. In his introductory Letter to the Reader, Verganti explains that this is a book on management. More specifically, “it’s about how to manage innovation that customers do not expect but eventually love. It shows how executives can realize an innovation strategy that leads to products and services that have a radical new meaning: those that convey a completely new reason for customers to buy them. Their meanings are so distinct from those that dominate the market that they might take people by surprise, but they are so inevitable that they convert people and make them passionate.” Or what Ben McConnell and Jackie Huba describe as “customer evangelists.”

Verganti calls this strategy “design-driven innovation” because design, in its etymological sense, means “making sense of things.” Therefore, think of design-driven innovation as the R&D process for meanings. This book shows “how companies can manage this process to radically overturn dominant meanings in an industry before their competitors so and therefore rule the competitors.” Throughout his lively narrative, Verganti responds to questions such as these:

1. How to innovate by making sense of things?

2. How to integrate design-driven innovation with an organization’s strategy?

3. How to initiative and then sustain productive interplay between “technology-push” and design-driven innovation?

4. Why do some companies invest in design-driven innovation and others don’t?

Note: Verganti’s comments in response to this question will be of great value to readers now determining whether or not design-driven innovation is appropriate to their organization’s needs, objectives, and resources.

5. What are “interpreters” and what is their role in the design-driven innovation process?

6. How to locate and then attract key interpreters?

7. How can an organization develop its own vision?

8. How to leverage the “seductive power” of the interpreters?

9. When establishing what Verganti calls the “Design-Driven Lab,” where to begin?

10. What is the “key role” of an organization’s senior managers and their influence on the organization’s culture?

However those involved are identified (e.g. “interpreters”) and their functions are defined, whatever a given organization’s goals and resources may be, questions such as these suggest critically important issues that must be addressed by its business leaders. If I understand Verganti’s core thesis, it is that the process by which to do that must itself be design-driven. That is to say, a competitive advantage can be achieved and then sustained only by innovative thinking about innovation. Only then can those who are involved “make sense” of what to do and how to do it for their customers.

Recommended Readings:

The Breakthrough Imperative: How the Best Managers Get Outstanding Results
Mark Gottfredson and Herman Saenz

Transforming Performance Measurement: Rethinking the Way We Measure and Drive Organizational Success
Dean R. Spitzer

Enterprise Architecture as Strategy: Creating a Foundation for Business Execution
Jeanne W. Ross, Peter Weill, and David Robertson

HR Transformation: Building Human Resources From the Outside
Dave Ulrich, Justin Allen, Wayne Brockbank, Jon Younger, and Mark Nym