Category Archives: Differentiated Products

Surely Big Business Isn’t This Dumb?

I see Sony is about to launch it’s own tablet device, the “Tablet S” for about $580 for a 16Gb model, running the Android operating system.

“So what?” you may ask.

So what indeed!

Almost every tablet maker is offering a system based on Android. And for the entry 16Gb models the price is $499 and up. HP was offering theirs with the new WebOS operating system. They pulled out before they barely got started. RiM, the Blackberry people are soon to launch theirs, with an ability ‘soon’ to run Android apps. Windows 8 is a way off, and currently looking like it is suffering from an identity crisis…

So how does looking the same as everybody else help you win business? I thought this was such a simple rule of business…

Buyers who do not want or care about the Apple ecosystem and offering, or avoid Apple on principle, have plenty of choice… For the moment. The current situation is unsustainable and many models, if not companies, will not survive in the tablet business for long. It will cost their shareholders dearly. Then choice will be reduced.

In the mean time the Android ship may be changing course as it recognises the problems having an open ‘standard’ with many different variants and interpretations bring… And that Apple may have been right to offer a controlled and closed ecosystem.

I love Apple stuff AND I want their to by viable competition, so I can get something better if I need it, and at the very least, Apple is kept on it’s toes with innovation…

So come on you big businesses… Offer something useful, viable and DIFFERENT!

If not, well, I look forward to the next firesale of failed tablet devices… It could bring a new dimension to the ‘hackintosh’ people as they work to put iOS and/or OSX on to these defunct tablets….

Just What Is This Business Acumen Thing Anyway?

Business acumen.

It’s a term that is often used in many contexts – and almost always seems to take on a mystical sense of great importance. Yet when you ask people to define it, you often get different definitions.

So what is the big deal?

Well, you can have 2 sales people that seem to do the same things, seem to do the right things, yet one is a lot more successful than the other. Why?

The more successful sales person – let’s call her ‘Sara’, is more likely to have made an explicit connection for the customer, between the customer’s current situation and the actual ‘pain’ it’s causing now, and/or could cause in the future. The less successful sales person – let’s call her ‘Una’ – is less likely to make that connection explicit for the customer. Where Sara wins out further over Una is in describing those connections in terms of 1 or more key business issues.

And because Sara has a better understanding of these key business issues, which, by the way, are the same in any and every business, she is able to get a higher overall sales price. She can use her business acumen – a combination of this knowledge of these key business issues, and the experience to know where, when and how to apply this knowledge.

So what are these core business issues? Ram Charan, in his book “What The CEO Wants You To Know”, listed them simply as

  • Cash – more so than revenue in the form of sales not yet paid for – a business fails usually when it runs out of cash – which it can do even with a strong order book
  • Margin/profit
  • Return on Assets – how much cash can be generated per unit of asset… related to velocity or turns…
  • Growth
  • Customers

But in practice it’s often thought of more as

  • Reducing costs
    • Development
    • Manufacturing
    • Sales
    • Servicing
  • Managing risk
    • Including reliability, quality and product lifetime
    • Agreement amongst key staff/managers
    • Other risks
  • Producing differentiated/innovative products
  • Efficiencies (time to market/lead time)
    • Development time
    • Manufacturing time
    • Logistics

By helping the customer understand the true nature of their situation, Sara shows clearly how she adds value for her customers. For Una’s customers they don’t see things so clearly, and so selecting Una can often feel too risky… and reducing the price can sometimes feel to the customer that they’re now taking on a less risky proposition… after all, risk is usually perceived as a product of how bad the situation can be (e.g. cost), and the likelihood this bad situation will actually arise.

So my call to action for you today is to help your clients at every opportunity to clarify their understanding of their situation, and have them tell you (i.e. make explicit) in terms of some combination of the list above, and in their own words, just what their situation is and how they’d like things to be in future. Help them by asking about the items in the list above – just translate the terms in the list in to the equivalent phrases/terms used in your client’s industry.