Who Is Your Customer?

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In Business – Why are you here?

WHO is your CUSTOMER?

I had an interesting conversation with Caroline, my daughter, yesterday. Caroline is a teacher, and a very good one. Of course, I am going to say that but it is very true. She teaches in an extremely underprivileged community where a very large percentage of the student body who are English Learners. Further, as with the majority of the students in our region, they rely heavily on the food programs available through schools to be able to have a meal each day. With many agricultural jobs, we see very hard-working families who still need the extra resources. A difficult situation to say the least.

We were talking about education and how this current situation, with the country closed down, is going to affect the future of education. My granddaughter goes to University, it is closed and her classes are all being conducted virtually: even the labs, as she is in the sciences. My grandson is in High School and all his classes are done virtually. My daughter teaches High School and she teaches all day, every day, virtually. Imagine that, would you? They are all in school and no one leaves home.

This is what I have been talking about since the early 2000’s. From the Khan Academy, to every major University, to IT training, most everything that anyone wants to learn is available on line. AND for the most part it is free. At Learning Without Scars we have provided a learning platform for individuals who want to improve their skills and knowledge. Unfortunately, that is not everyone. Being optimistic I believe that more people, particularly the younger generations will change that and that they will constantly be striving to make themselves better. Of course, the world has to catch up. In order for online education to succeed, our students need to have access to a decent connection to the online world. That is still not true in many parts of our country today.

Which brings me to the customer and my conversation with Caroline. The end customer of education is society. School is the vehicle which every community uses to develop the people that will create the social and economic activity that will better society. BUT, the primary customer of the school systems, of education, is the student and their family. Too often that fact gets lost in the bureaucracies of the education community: the Federal Government, which does not have a role in education enumerated in the Constitution; the State Governments, who have primary responsibility, the School Boards with elected Administrators, many of whom have never taught in a classroom in their lives, municipal governments, who receive the taxes to pay for schools and on and on. Who is thinking about the customer here? Of course, it is the teacher. But who supports that teacher?

Now look at your business. WHO is YOUR customer? That should be a very easy question to answer. I would like you to think about that for when we come out of this economic shutdown. WHO is YOUR customer? Is it the person coming in to order parts? Is it the person who calls to schedule maintenance or a repair on a machine? WHO is it? In many of these cases it is an employee of a business who uses equipment. But one more time please – WHO is the CUSTOMER?

I am hopeful that every distributor and dealer will come to a different conclusion than what has been true the past three to four decades. I am hopeful that they will begin to operate in a radically different manner than they have recently. I am hopeful that the employees will be given more and better tools to serve the machine owners. But then again, I am an optimistic person.

Things won’t be any different coming out of this economic shutdown unless we make them different. And that means some serious thinking about WHO that CUSTOMER really is that you are serving.

The Time is Now.

Back to the Basics: Your Customers

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For the last month we have been discussing change and the fact that although it is causing us anxiety it also creates opportunities for the talented, curious, ambitious and hard-working people in our businesses.

Let’s get our heads out of the clouds and return to the dirt. Let’s get back to basics. What is troubling is that many of us don’t remember what that means. What are the basics?

Let me start at the beginning: it all starts with customers.

 

Without your customers you have nothing.

 

How do you think you customers view you? Do you know their perceptions of your business? We use the “Balanced Scorecard” as one of the fundamental tools to help our clients to develop and manage their business. It is also an LOD (Learning On Demand) product in our training business www.learningwithoutscars.com

The Balanced Scorecard, from our perspective, starts with the customer. What are the needs and wants, the expectations that our customers have of us? That is where we start. We use an employee training session as the vehicle, we suggest these programs happen eight times a year and take an hour and a half each. We have all the parts employees or service employees or both together and ask them to make a list of what the customers want.

Don’t interfere, don’t editorialize, and don’t have your thoughts dominate the room – remember EQ here. The leader should always speak last and listen first. Then, after the list is completed you will have similar points on the list. Narrow the list down to a list of unique items.

The following month we have a group of customers come in and we ask them the same questions in front of the same group of employees who made the original list. Don’t interfere with their list. Listen carefully. Make notes and make sure that your customers agree with the list you have created from listening to them.

After this, we have a third meeting where we reconcile the two lists. How similar were they? Which items are the most important? Pick the top five. Then call the customers back and ask if they agree with the top five list. If they do then you can go to the next step. The next step in the Balanced Scorecard for us is Internal Excellence. What do we need to excel at in order to satisfy the customer? This is the first step on the Back to Basics road.

This is just the first portion of what we must do to achieve customers for life.

The time is now.

Making Sense of the Numbers

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When we look at our businesses, our numbers need to add up.  But how do we calculate the potential represented within a sales territory?

It begins with the potential business we can earn from each of our customers.

Where Should We Begin? #MondayBlogs

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I often say that life is simple, and people make it complicated.

The same is true of our processes and procedures – they can be simple, unless we make it complicated.

Let’s first review one thing I know to be true: everyone wants to do a good job.  No one wakes up in the morning, excited to go to work and do a terrible job.  Everyone wants to succeed and do a good job.

But one key to doing a good job, is KNOWING what we need to do.  This crucial piece applies across ALL industries, it applies to our professional lives and, frankly, it applies to our personal lives as well.  In order to succeed, we need to know what has to be done.

When it comes to repairs for our customers, our Work Order Process has a series of simple steps for us to use to determine what must take place in order to meet the needs of our customer base.

I hope you enjoy this small video tutorial on the beginning of the Work Order Process.

The time is now.

Product Support Selling

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Our seminar on Product Support Selling – The New Frontier is coming up in Dallas, Texas on April 15 and 16, 2015.  This 2 day seminar encompasses 4 elements:

  • The fundamentals of selling
  • The foundation of territory management
  • Managing Customer Relationships
  • Customer Service Fundamentals

This program is geared towards Product Support Sales, Customer Service, Instore Sales, Supervisors,  and Managers.

This course covers all the theories and applications necessary for Product Support Selling in the 21st Century.

The time is now.

Parts Management – Customer Service

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What Drives Good Customer Service

Attracting, developing, sustaining, and retaining customers is the key to profitability.

In the world of customer service, we seem to be saying one thing and doing something different. We don’t walk our talk. But we are not alone as a group of service providers who are interested in what our customers need and want. This has become an epidemic in industries worldwide.

Microsoft commissioned a major survey back in 2007 as well. Its conclusion was that the number one business issue for service providers was “customer relationships.”

The survey noted: “They value innovations that support improvement in the customer experience, and they paint a picture of corporate cultures that prioritize customers.”

The survey conclusion also asked, “Why is it that their actions don’t support this belief?”

This is a similar conclusion that I reach in my consulting business. When intellectually we know what needs to be done, why is it we just don’t get it done?

Blog post 11132014

This might be a cute comment, were it not so serious. The world has clearly changed. Products are much more capable and technology is definitely influencing how they can be used. The opportunities for clients to obtain products and services from a variety of suppliers have never been so numerous. How will we defend ourselves and protect our customers from competition?

We have a serious need to provide much better training, technology, and tools to our employees, especially the ones we charge with the responsibility of satisfying customers in the parts and service groups. Without good system information, these critical employees are dead in the water.

And so far, we haven’t provided them with much good information. Many times the first question we have to ask the customer in parts support or service inquiries is, “Who are you?”

How friendly is that opening for a discussion with a potential consumer? Does it bolster a “customer relationship”? I think not. Go back to the conclusion from the Microsoft survey and note the “innovations that support improvement in the customer experience.” What have you done over the past year to enhance the customer experience in your business? More importantly, what are you planning now?

My suspicion is there was nothing in the plan last year and this is not a subject included in many of your businesses’ annual planning cycles. You know that process, don’t you?When you set budgets and create forecasts. This planning cycle needs to be focused on the customer experience, not only on your profit and loss. Companies that focus inwardly are destined to fail. It is the company that focuses on keeping their customers happy that will succeed.

Let’s look at the top focuses of the companies surveyed in the Microsoft survey.

It is very clear and straightforward to me, and I am sure to you as well. The view of the market in 2009 is cloudy and mixed at best. We might have a somewhat brighter outlook based on the more environmentally sensitive mood in the country, but the economic outlook is much more difficult than at any other time in my experience.

Yet I know that parts and service business opportunities will increase. I also know that you know your opportunity to increase business in the parts and service area is huge. But I also think it is clear you either don’t know what to do or don’t want to do it. That is a difficult position to be in, isn’t it? The customer expects us to provide leadership to them. They expect us to provide the support they require for their needs.

So do yourself and your customers a favor and ask what they want you to do for them. Don’t be shy. They will willingly tell you what it is they want and need. But be careful. If you ask and they tell you, then you will have to act. If you don’t act, you will be in more trouble than if you hadn’t asked at all.

Last month we looked at your most valuable service attribute as a business—your employees. This month we’ve looked at retaining your customers, the people who provide everything in your life.

Are you ready for the challenge? The market, your employees, and your customers wait for your answer.

Confessions of a Service Manager ~ Bill Pyles

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We are introducing a new area for our blog. We are asking experienced Industry professionals to write on a subject that they think would be of interest to our followers.

Today, I am introducing Bill Pyles. Bill has 40 plus years in the OEM product support arena.

He worked for Caterpillar, Komatsu and John Deere dealers in various locations across the USA.

He has worked most, if not all, positions in Product Support from technician to Executive.

He still is actively engaged in the business and still thoroughly enjoys being a part of the equipment industry and looks forward to every new day.

Bill has been married for 42 years to his wife, Diana, and has two sons that are currently working in the OEM dealer world, one with a Cat dealer and one with a Deere dealer.  He is also fortunate enough to have five grandchildren.

Bill is also a U.S. Marine Corps veteran. Semper Fi.

I hope you enjoy, as I do, reading Bill’s thinking on a wide range of subjects over the weeks and months ahead. Welcome, Bill.

The Time is Now…

Confessions of a Service Manager

I’ve been working in Product Support most of my life.  Most of those 30 years have been primarily focused on service department product support.  I spent time as a shop mechanic, field mechanic, shop foreman and service manager.  I learned a lot during those years.  I learned:

  • How to move labor and material around on a work order to make the times look good.
  • How to avoid any lost time by charging time to sales, rentals, and used equipment.
  • How to handle warranties by sending a less-than-qualified mechanic because “it’s warranty” and it would be “good” training: and what the hell, the manufacturer is paying for it.
  • That if the boss’s hot button was “reduce training” or “reduce expenses,” you simply moved that time to building maintenance or repair of shop tools.  If expenses were high, you shifted them to cost of sales.
  • The importance of taking care of my customers first by letting the sales department wait and wait and wait.
  • That a two-week backlog was good: hey, three weeks was better.  Keeping this backlog ensured I would make my numbers for the month.  The customer would wait.
  • That you never sent work to another branch or even asked if another shop was slow.
  • That if I had a big job, I never called another store for help to take care of other jobs.  Remember the “backlog.”
  • There was never enough time in the day, so when vendors delivered oxygen and acetylene bottles, bolts, nuts, shop supplies there was no need to check the delivery before signing the delivery ticket.  Nothing ever “falls off the back of the truck.”
  • That sales, rental or used equipment never received any warranty on shop or field repairs.  Remember the “budget.”
  • How to sandbag monthly sales.  If we meet budget this month, hold off any more billing until next month.  I have a budget to make then, too.
  • Never to call a customer for additional work a machine needed, while the machine was down.  He’d yell at me if I suggested additional work needed to be done.  It was always easier to say nothing and if the machine failed after it left the shop, he’d call me.
  • If a machine was coming in for a final drive repair, I’d order ever nut, bolt and gear and air freight them in.  I might need them and if I don’t, the parts department will just put them back on the shelf.  No big deal.

During those times, life was good.  My numbers looked good.  I had a backlog, and the boss was off my back.

Then I became a Manager.

Then I became a General Service Manager and was included in management meetings I never knew existed.  I discovered there were other departments challenged to be efficient and profitable – just like me – and unless all departments worked together, it would not happen.

  • It took a little while, but I began to realize why the sales manager was not always so willing to let me have a loaner for a service job I screwed up.  Those labor hours I was writing off to sales, rental and used were actually showing up on his P&L!
  • Those new, used and rental machines were expensive assets that I kept putting to the back of the schedule so I could take care of my customers.  I didn’t know the company was missing opportunities and thousands of dollars because we had no machines to rent or sell.
  • I learned warranty training was expensive.  Those dollars actually came back in the form of warranty expense.  You mean the manufacturer didn’t pay for 10 hours of labor to replace a fuel filter?
  • I discovered the time I invested swapping labor and material around did nothing for the actual bottom line.  What?  I spent hours doing that!
  • I learned a backlog was good but a satisfied customer was better.  I’d visit customers and ask why he sent a machine to another company.  Usually the answer was “Bill, you guys do good work and I don’t mind even paying a little more for good work, but I can’t wait three or four weeks every time my machine goes into the shop.”
  • So I learned to work the overtime when required.  I learned to ask other shops for help and sometimes I even suggested the customer send the machine to another branch that could get him in and out the quickest.  SOmetimes I even offered to pay the additional hauling to get him there!
  • I learned things do “fall off the back of a truck.”  Have you ever been offered a deal too good to be true?  Hey, it fell off the back of a truck.  I went through an audit after the company decided to change oxygen and acetylene vendors.  The vendor came in and did an audit on all the bottles we rented over the years.  We could not come up with $6,500 worth of rented bottles.  They must be lying all over America’s highways.
  • I learned if I didn’t contact a customer for needed additional work, the machine would leave the shop (“Hey, I did what he asked!”) and would fail soon after – on the job.  The first thing I’d hear would be, “It just left your %#@*&% SHOP!” – and I should have called him and fixed it then.
  • I learned that the boatload of parts I ordered for the final drive repair and returned to parts created a lot of expense.  No one told me there were shipping and emergency charges, and we didn’t stock the part because there was no demand.  I learned those expenses were showing up on the parts manager’s P&L.
  • I found out someone had to take the time to do the parts entry, place the order, receive it into inventory, carry it to the shop, pick it up after I returned it and create another return ticket.  They they’d create a location in the warehouse (remember, we did not stock it), and let it sit until the next authorized parts return when the company might get 50 cents on the dollar!  Wow, no wonder when I asked for help on a disputed service invoice, I’d get a cold stare from the parts manager.

The Old and the New

My point (yes, there is a point to all of this) is there are two types of service management – the old and the new.  The old type will not survive at today’s distributorship.  Managers who think like that are being replaced with managers who are concerned with the entire company’s health, not just the service department.

The new service managers are discovering that working together – sales, parts and service – makes a much more enjoyable job.  Time spent hiding expenses rather than addressing the issue is a complete waste of time.  The real cause of the expense is never removed or identified and swapping time becomes routine and a drain on your time.

Direct and constructive communication with other department managers is key to making our company successful, profitable and raising customer satisfaction.  Believe it or not, it starts with the service department!

You can connect with Bill on LinkedIn at  www.linkedin.com/pub/bill-pyles/12/a24/7ab

Friday Filosophy v2013-36

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The only real training for leadership is leadership.

Anthony Jay

Believe in yourself and there will come a day when others will have no choice but to believe in you.

Cynthia Kersey

Courage is not simply one of the virtues, but the form of every virtue at the testing point.

C.S. Lewis

The time is now…..

Change Mangement v1.3

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The New Reality is spawning all manner of changes in our world. Over the past thirty some years with the advent of the personal computer, for “data processing” and the internet, for “networking” and the smart phone, for “your wallet” the personal liberation revolution is in full bloom.

Since the Industrial Revolution the only manner in which a Company could “scale up productivity and profit” was by treating customers as populations instead of individuals. This has become magnified with CRM systems. Customer Relationship Management requires the use of market segmentation with became a serious exercise in the 1980’s and has become perfected since. The only way that this can be challenged is by empowering the individual.

From loyalty cards, started by service stations and oil companies in the fifties and sixties, to airline frequent flyer clubs the customer gives up their personal history every time they use a product or service. This is being turned on its head by the PC and tablets, the internet and the smart phones or PDA’s. Individuals are started to obtain the same power.

Now we see the arrival of a new thought VRM. Vendor Relationship Management where the customer truly does become “king.”

Imagine your “smart phone” where your network supplier AT&T, Sprint. T-Mobile or Verizon “lock” you up on two year contracts. That aberration in individual liberty will soon be extinct. Similarly marketeers will no longer be using words like “acquire” or “control” or manage” or “lock in” when they talk about customers. Are we the ultimate “round up?”

No with this new idea VRM the customer will regain control as if we were back to the butcher, the baker and the candlestick maker. You will shop with a PDA and be able to pass your information on to a Vendor only at your discretion. There will be implicit “contracts” of information and personal privacy. This will start more seriously as Microsoft requires the DNT (Do No Track) features will be turned on in the new Internet Explorer and that “Ad Blockers” become even more popular as with Chrome and Firefox. Ad blockers and more common in Europe today but that is fast changing.

The new marketers will have to find a new game won’t they? This new marketer will recognize the Service-Dominant aspect of their world. That relationships are a choice of a customer not the whim of a supplier. The time is now.

Data Mining – Statistics Revisited

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One of the useful attributes of a VoIP system is the ability to choose the important elements of information about a client that you want to appear on the screen as the phone is ringing. Of significance might be the date of last contact, date of sale, type of sale, and value of sale. From the probability discussion yesterday this will help you determine when the next sales transaction should take place. It might help how you approach the discussion. The time is now..