Direct Marketing Article
Winners and Losers in the "New Normal" Economy - The Top 10 Differences
By Stuart Morley
How is it that companies that have been around for more than 100 years
failed in this economic downturn while other younger companies like Apple,
Facebook, WalMart and The Huffington Post continued to grow? It is a similar
picture for many lesser-known, mid-sized companies: some have failed and
others have thrived, irrespective of their industry, size or location.
It is the best of times and the worst of times. Too many businesses are
reacting in fear, pulling back and struggling. There are 10 key differences
between a thriving company and a floundering one in this economy. Ask
yourself, are you:
Sticking to your industry or crossing the boundaries?
The struggling businesses spend a lot of time try to copy the "big guys" in
their industry and wonder why this approach does not work for them.
Successful businesses seem to ignore the big guys and focus on current and
prospective customers. When probed further it was found that many of these
successful businesses are finding opportunities at the overlap of two or
more industries. These businesses try to follow the example of companies
like Cirque Du Soleil who combined elements of both the circus and theatre
industries in better venues than the average circus.
Is your company looking for opportunities at the boundaries of your
Focusing on economists or customers?
Embattled businesses seem to be consumed by watching and reading about bad
economic news trying to understand the mind of economists. The successful
businesses seldom have time to watch TV or read a newspaper. It does not
mean they don't hear the bad news; it is everywhere. They just don't dwell
on it. They are busy watching and reading about their customers and going to
customer events, customer trade shows and customer seminars to better
understand their mind of the customer.
When did you last did go to a customer trade show or event rather than
events for your industry?
Focusing on price or value?
We all know stories of airline passengers paying 10 times the price of other
passengers. This approach works in many industries. Service can be escalated
based on value and delivered to some clients who would pay ten times as much
for the added value. The struggling businesses are stuck in commodity-type
situations with very little price flexibility. The successful businesses
find ways to get price control and avoid competition because they are better
at articulating their value and using different ways to price their
How much control do you have over your pricing?
Talking to industry leaders or to employees?
It is amazing how much time business leaders will devote to their industry
events. They sit on committees and attend conferences for their own
industries, spending more time talking to competitors and industry gurus
than they do talking to employees who are in daily contact with customers.
The successful businesses seldom send people to events in their industry.
They spend more time reviewing employee surveys than industry surveys.
Have you recently asked employees about what customers are saying that could
open the door to new products and services?
Preparing for best of times or the worst of times?
The struggling businesses are clinging to their existing products and
services and focusing on cutting costs in all areas to protect cash in the
short term. These businesses assume things are only going to get worse.
However the successful businesses say they are seeing more volatility and
they are having some of their best months and some of their worst months all
in the same year. Thriving businesses are focused on finding things that
will help them in the good months and the bad months. They are breathing
life into more experiments with new product and service ideas than ever
before. Analysis has shown that most of their revenues today come from
products and services they did not offer a few years ago.
How much of your revenues and profits come products and services you did not
offer a few years ago?
Focusing on jobs or projects?
The most dynamic companies today have 80% of their employees spend more of
their time on projects and only 20% doing routine work. It seems the
struggling businesses are caught up in traditional management hierarchies
where employees are viewed as having routine job descriptions. Management
wants employees to do the routine work faster, rather than finding the next
breakthrough opportunity. Successful businesses seem to recognize and manage
projects carefully, as they find this is where they generate most of the new
ideas and breakthroughs.
How much of your company is project focused versus routine focused?
Doing more or less?
We are so busy we tend to stick with existing methods because we don't have
enough time to stop, reflect, research, and implement better methods. The
struggling businesses add new work to employees' to-do lists. The successful
businesses have regular exercises to find things to stop doing, so that
employees can find free time to do new things.
When is the last time your company had an exercise to see what you could
Standardizing or living at the edge of chaos?
The struggling businesses seem to love installing new, complicated (often
computer-based) accounting, manufacturing or supply chain systems because
that is what the big companies in the industry have done. They hope this
will be the "silver bullet" to solve all their problems. These large
complicated systems work well in situations where all the variables are
known. However, successful businesses tend to avoid these large complicated
systems because they felt they were not in control of all the variables that
impacted their business. Complicated systems cannot function in complex
environments where many variables are unknown. Successful companies use a
wide range of smaller, flexible systems focused on tracking customers and
trends rather than tracking employees and financial history.
Is your business complex or complicated?
Keeping your financials secret or sharing with employees?
Many successful businesses have learned that, in the tough times, sharing
the news, good and bad, with all employees at all levels works. This
empowers employees to act with confidence, as they know they whole story.
The success rate with the turnaround increases dramatically with this one
step. Successful businesses encourage their workforce to perform less like
employees and more like entrepreneurial-minded, strategic partners. They
also take time to celebrate successes, both big and small.
How much do you share and celebrate with employees?
Working long hours or take more holidays?
Business owners and managers in struggling businesses seem to work longer
hours in the vain hope that putting their head down and doing more of the
same is the solution. The successful businesses focus on doing things
differently. Successful businesses owners and managers work fewer hours and
take more holidays; they have realized that when times get tough it is
usually because customers are buying less. They need an answer to why
customers are buying less from them. The successful business owners and
managers tell us they find their best thinking is done away from the office
in situations that are less stressful.
When last did you work fewer hours in the week or take an extra holiday?
Do you have what it takes to thrive, and not just survive, in this "new
normal" economy? Keep your business in mind, and see how many of these 10
questions you have addressed lately. It may give you a clue as to how well
you are turning these worst of times into the best of times.
About the Author:
Stuart Morley is the founder and Master Strategist with JUMP, a division of
Morley & Associates Inc. Stuart has worked with more than 300 mid market
clients to facilitate companies transitioning for growth and profitability.
Stuart is an author of "Weather the Storm. A Survival Guide For Mid Market
Organizations." For more information email him at
his website at www.brsjump.com or call (705) 646-7722.