06.22.09
Posted in Advertising, CMS, Digital, Economy, GFC, Marketing, Media, Melbourne, Social Media, new business at 12:43 am by drwarwick
I know this, because there is even a great website that says so http://notalwaysright.com/ sent to me kindly by Derek Jenkins (http://twitter.com/ozdj/), so that could be the end of the argument! However as you can no doubt guess, I have some points to make and questions to pose (not to mention a #badclient hashtag to launch). So lets start with some parameters …
The Playing Field
I am going to use ‘client’ rather than customer, mostly because I am talking principally about the customers of professional service organisations. I believe what follows can apply to most customers and your comments can bear this out.
Secondly, I am talking about ethical and professional organizations. We have all needed to escalate something to a manager. We have all encountered poor professional service. We have all had communication failings - often two sided. I am not exploring these aspects and as a result, and for the purpose of the argument, I am discussing goods and services provided to industry standard, both professionally and ethically.
Finally, I am not anti-client. In fact the oposite is true, the adage “the client is always right” makes for good client service philosophy because at the very least, the client is crucial, knows their business and is the lifeblood of any commercial organization. They should be respected, heard, courted, valued and ultimately the recipient of something of significant value. There is however such a thing as a #badclient …
Some Bad Client Signals
No mandate - Usually the provision of a service involves the client adopting the service and as a result some level of change. Humans generally accept change poorly. When a client does not actually want the value that flows from a service, there is no capacity for the service to deliver a benefit. This can include services not properly commissioned, services rejected by gatekeepers and my favorite because of the irony: Pro bono services accepted by charitable clients because they are come free of charge, delivered in circumstances where they are not needed or cannot be used by the client.
No respect - The client who thinks they know better. Once the work starts (and often before), this client will give a level of instruction or embark on an ego trip because they believe their knowledge is superior to that of the supplier. In my game, this is the client who wants to tell me how to build a web CMS system after scoping their organization’s needs, without understanding that we have put more than a decade into understanding best practice in this field (enough self indulgence). Of course the supplier who thinks they know their clients business better than their client is also deluding themselves but as mentioned, we are not focussing on the supply side here.
No value - In this case, the client does not value the service enough to cover the cost of there provision. It may be a case of ‘bad-fit’, where the offering simply does not produce enough incremental value for the client to benefit more than the provisioning cost. However the truly BAD CLIENT gets plenty of value but still will not transfer any of this to the supplier. If you break this down, it amounts to their belief that they can build a sustainable profitable business but you shouldn’t be able to. A good client realises that a symbiotic relationship of mutual benefit and enlightended self-interest is much better for both parties.
Narcissism -this is really the trigger for this post and I am silent on the culprit that pushed me over the edge. This client has no empathy for you (the supplier) or any other client. Give away signs: (1) deliberately sowing internal discontent by playing supplier staff off against each other, (2) never agreeing that services have been completed or properly provided, (3) every communication is a complaint and there is never a recognition of value provided, (4) services are expected to be prioritized ahead of any other client, (5) the client believes that they are the creator of all intellectual property and nothing, even IP developed for other clients, should belong to anyone but them, and (6) other blatantly manipulative behaviour. Yes, I have encountered client narcissim to this extent and I am interested in stories you may have (no names).
Too Late?
Hanging on to these relationships is false economy. A client who exhibits one or more of the above signals as a standard mode of operation is preventing you from servicing your good clients properly. They are inflating your delivery costs. They are demoralizing your staff. They are sending negative signals to the market. They will not stop and if the cancer gets bad enough they will sink you because at the very least you will loose competitive advantage. So why persevere, is it because your organization accepts the claim that ‘the client is always right’? Will you believe them over your quality staff? It is not too late, let them go and you will be transformed for the better, you may even find your other clients and your staff thank you. Please don’t send them to me 
Some Early Questions
I have been working in solution sales for longer than I care to admit. When I hear “we are commissioning you because our last supplier was no good”, I still take this on face value and make the stock standard commitment that we will perform better. In reality, there has got to be an even-money chance that at least equal fault lies with the new client as it does with their former supplier. In this case, perhaps it is prudent to explore your prospect with a bit more attention. It is possible to end up with a worse outcome than failing to win a piece of business.
Why not a client credit check looking for payment history? Why not ask to speak to other suppliers? Does the client exhibit early examples of a lack of respect, lack of value, lack of operational mandate and perhaps most of all excessive self importance. Maybe do what my Grandmother suggested, take them to lunch and see how they treat people who have no power in a transactional relationship. Be warned, I will never again work for a client who tries to impress me by treating waiting staff poorly.
Please tell me what I have missed, your experiences and horror stories. Remember I am not defending suppliers, there are plenty of substandard service moments, I have experienced a bunch of them myself in just the last few days.
My premise is that if you forget the customer you will fail, however as with any relationship, no party is always right. QED - The customer is NOT always right.
Join me on Twitter @drwarwick - http://twitter.com/drwarwick. Maybe we can even start an ongoing conversation - hash tag: #badclient however no doubt a tag #badsupplier would be more successful
Thanks for your attention and in advance for your input.
Cheers and regards,
David Warwick
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06.11.09
Posted in Digital, Economy, GFC, Marketing, Media, Social Media at 6:56 pm by drwarwick
An exploration of pace and innovation …
We are still in the throws of the GFC (Global Financial Crisis), with all the attendant effects. One of those effects is a fall in production that varies by country or any other segmentation you may wish to apply. For this post, lets consider a fairly common fall as 2 percent (see The Age article of 27 May 2009, http://bit.ly/nTbAY), this is, in simplistic analysis, the same as going backward a year. In other words our financial position, standard of living, productive power are taken back to 2007.
So why does the effect feel so much worse?
One cause of hardship is rapid inbalance and unequal distribution, something our systems don’t cope with well. Some of us are not effected at all and others are severely hurt by the shift from growth to recession. I am proposing that another, perhaps more important cause is a dramatic fall in economic velocity. Let my try and illustrate this in a couple of ways.
Lets say I am looking to invest $1m. In a period when this is going into an economy that is growing across the board, I am likely to be agressive about investment. When the economy is shrinking, I am reticent to invest and much more likely to take time determining the appropriate place to ‘park’ my investment. Even the language in such a negative climate is full of terms that imply consideration, care, delay, reservation and let me say it – lack of velocity. This is a compounding effect that moves throughout the economy, macro and micro and saps the energy that is palpable in boom times.
If we were to use fluid dynamics as an analogy, most of our thinking and discussion relates to volume (how much money) and very little is about the pressure (market demand) and speed (rate of transfer). I believe that understanding the rate of transfer, the rate of signing new business and the rate of business completion would go a long way to explaining why we all know that this is much more than a two percent reduction in GDP. Lets face it, this feels nothing like 2007.
Something else to think about …
You can find examples of the world’s increasing pace everywhere, for goodness sake, we are even walking faster (see Daily Mail article, http://bit.ly/2CTIX), some 8 percent faster than a decade ago. We expect everything faster, goods, media, news, services, basically everything. The recession or GFC is letting many of us reassess work-life balance and in many cases business itself is encouraging part-time or reduced hours of work. This is unlikely to be a permanent dynamic, our personal lives are not slowing down, we are just transfering energy, so this is not a return to some previous era or a more relaxed or clever futuristic model.
Look at SMS, Twitter, TV show titles displayed picture-in-picture or moved online, shorter newspaper and online articles, or self-serve supermarket checkout for examples of velocity delivered. In fact look anywhere you like and you will see the ’speed’ imperative in action.
So what does it mean?
Economic growth can come from a number of sources. Primary resources which as we all know are finite and running out. Labour – we can increase population although this does not deliver per-person growth. Sweat – we can all work harder. Velocity – we can all work faster, the premise of this piece, and our walking speed, communication speed and stress are all indications of this. I suggest that our velocity has limits and is in itself a finite resource. At some point you just cannot walk, read or engage with someone any faster, get to work faster or even multi-task anthing else.
So either we are heading into a future where resource, labour and personal speed (velocity) have delivered to the engine room all that they can. To borrow from Star Trek, (here you shift to Scotish accent) “I’ve giv’n her all she’s got captain, an’ I canna give her no more.” Well thankfully for Star Trek there was always an answer, the same answer that has worked for us all along – Innovation.
Not surprisingly when the chips are down we encounter the most rapid change. War, disaster, economic downturn are in many ways the catalyst for adaptation and change. Now is the time to look for innovation in your business, your life and in addressing the many challenges ahead. If you can’t or won’t deliver innovation yourself (you can of course), then at least embrace the change because what worked before won’t work now.
I have some more to say on related topics and will post again soon.
For some velocity, see you on Twitter @drwarwick. Full URL http://twitter.com/drwarwick
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04.21.09
Posted in Economy, Finance, GFC, Melbourne at 12:09 am by drwarwick
On Tuesday 21 April 2009, I attended a seminar at BMW Edge, Federation Square Melbourne, with the same title as this post (have to say I am beyond tired of the overuse of the GFC acronym for all the world’s ills). Nevertheless it was a good discussion that I was going to tweet some of the comments but now feel the material needs more than a few 140 character phrases.
The session was sponsored by Melbourne Conversations, City of Melbourne and Future Leaders, take a look at http://tinyurl.com/d32tsz for more details.
My take-aways, coloured by my own perceptions and opinions are as follows, hope you find a gem (thanks go to the speakers and not to me) …
Professor Sue Richardson (Flinders University, Adelaide)
Commented that the two percent fall in GDP only takes the world economy back to a standard of living that we enjoyed in 2007 and in one sense is an overstated problem. The real problem is uneven distribution, and as a result the fact that the change impacts on certain segments of society much more profoundly than others.
Other observations included a increased call on the public sector and a possible reduction in the excessive work hours of recent years to a more balance work effort. As far as concerted effort, activity focussed on disadvantaged segments should be supported.
Sharan Burrow (President of the ACTU)
Discussed the ‘Double - Crunch’ of both the financial crisis and environmental crisis upon the global society. Her premise that financial institutions should reassess their purpose and realise that they exist to support communities not to profit from them and that a new moral foundation was required for international markets.
Sharan also made the point that the majority of affected people, especially in economies on their knees, did not understand how ‘toxic debt’ and globalization had taken their jobs, hours, wages and homes and that the level of anger in some places, notably Europe, was palpable.
Professor Ian McDonald (Melbourne University)
Suggested that financial innovation had helped society and that a negative overreaction was not dissimilar to the excesses of the boom period. He illustrated how humans are prone to invent stories to ’suit the circumstances’ and provide self-serving bias. The positive reinforcement of a boom market made institutions feel invulnerable and as a consequence make increasingly poor decisions. The boom stories throughout history, for example, steam, the web, and China all allow a boom period to be seen as ‘unique and sustainable’ and these constructions help us to forget or ignore the paterns of the past.
In a sense the ‘boom stories’, reinforced by medium term successes are the group equivalent of individual bias. For example, the fact that ninety-percent of drivers believe that they are of above average skill, clearly not possible is the same as financial institution believing that asset values could continue to grow at boom rates.
Marcus Padley (Stockbroker and Columnist)
Compared the financial markets fall over the past year (55 percent) to the movie ‘Das Boat’, in the sense that the market fell below its ‘designed depth’ and began to break apart. Market losses in general have three-times the emotional impact of gains and fear as a driver is much stronger than confidence.
The result is that generally humans are cautious at the bottom of a market and risk-takers at the top and that this is not the correct ‘wiring’ to make a successful investor.
Marcus made the point that the business around the markets are ‘marketing machines’ and that ‘no one will ever tell you to sell’. In investment, the sell decision needs to be your’s alone and in a falling market cash is better than a defensive stock (which is only a stock that falls less).
Thank you to the organizers and the speakers for their insights. However as Marcus said, the conversation that is occuring now actually needed to occur sixteen months ago. At least he suggested, we have the ‘unfettered exuberance’ of his children (and their generation) who won’t remember this and will see the next boom as a permanent dynamic to sell his assets to.
This is the first and last time I will be using the acronym GFC. As far as I am concerned it is as passe as ’synergy’ and ‘best-practice’ (although I haven’t stoped using them).
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