Leading with Trust

Improving Your Value to Your Customers

The following is a guess post from Nat Greene based on lessons and concepts in his new book Stop Guessing.

stopguessingbookcoverAs a business leader, one of your key responsibilities is ensuring that your customers see huge value in your offering. In the hyper-competitive landscape of 21st century business, you have the difficult tax of constantly increasing your customer value. Many businesses focus primarily on reducing their cost to customers: if a customer gets the same product for less money, they see greater value in the investment. But merely driving down costs makes for a low-margin future, and strategically locks you in an ongoing price war with your competitors.

A far more effective–and enjoyable–path is seeking to improve the value of your product, so your customers are getting more for the same price. Doing this creates greater customer loyalty, improves your margins, and improves the satisfaction of your team, knowing that they’re better serving your customers rather than simply trying to be the lowest-cost provider.

You have certainly already put significant thought into this, and realized there are many different options by which you can attempt to improve your value to your customers. If you have spent time on search engines looking for ideas, you have likely found pithy lists or tips that will give you even more ideas to try out than you already had. But you have limited resources, and you know that what works well for some will not necessarily apply to your unique business and unique customers’ needs. How can you choose what’s most effective?

Learn How to Improve Customer Value

As for any problem you’re trying to solve, approaching the problem with the right behaviors will help you find the most effective solution for your unique situation. Rather than trying out different ideas that others have tried before, you need to understand your problem by observing it thoroughly and learning as much about it as possible.

To do this, get close to your customers. Don’t just ask them what they want from you: they are not likely to be able to conjure up in their minds what you can do for them. And that’s not their job: it’s yours. Understand how your product or service interacts with their business, and what changes would make the most impact to them. Approach this investigation by starting with the following questions:

  • How do they use your product?
  • What about their business are they trying to improve with your product?
  • What resources do they deploy by working with your product?
  • What do they have to do internally in order to work with your product?
  • What is their experience trying to acquire your product?
  • What is your customer’s biggest pain point that your product interacts with?

By understanding the answers to these questions–and more that arise during your investigation–you will be able to understand what you can change about your product that will most improve your value to your customers, and you’ll find yourself not only holding on to customers you may have been losing, but you may also find yourself at a higher price point.

Case In Point

One business I was working with made high-performance coatings for products like ships, jet planes, and equipment that underwent lots of stress, such as heat. In order to improve their cost competitiveness, they were planning on moving their operation from Western Europe to Eastern Europe, where labor costs were lower. The operation would have taken years and of course entailed significant capital costs to implement.

When they instead found out what was most important to their customers, price did not rise to the top. Instead, they found that the biggest stress to their customers was their own supply chain: these customers wanted to get their jets, ships, and heavy equipment out to their own customers reliably on time. Each of these manufacturers had to buy dozens of parts to assemble at their own facilities, and they felt constant stress that any late delivery would impact their own production timeline.

The coatings business decided to instead focus on perfecting its in-full on-time (IFOT) delivery performance. We worked together to solve logistics problems that caused some of their shipments to arrive late, and they were able to quickly boast the best IFOT in the industry. Their customers were thrilled, as they could be confident that at least the coatings part of their sourcing operation was something they never had to worry about. They stayed in Western Europe in order to keep their lead times low, and were even able to increase the price of their own products, without a grumble from their customers.


Nathaniel Greene is the co-founder and current CEO of Stroud International, and author of Stop Guessing: The 9 Behaviors of Great Problem-Solvers. Nat has a Masters of Engineering from Oxford University and studied design, manufacturing and management at Cambridge University, in addition to executive education coursework in Harvard Business School’s Owner/President Management program.

Do You Manage Conflict or Does It Manage You? 5 Strategies for Success

ConflictConflict gets a bad rap. Most people tend to view conflict as a bad thing, automatically assuming it has to be an adversarial win or lose situation. The reality is that conflict is inevitable in relationships and it isn’t inherently a negative thing. It depends if you choose to manage the conflict or let the conflict manage you.

I’m a fan of the Thomas Kilmann model of conflict management because of its dispassionate approach to the topic and the practical strategies it offers for its followers. Kilmann defines conflict as any situation where your concerns or desires differ from those of another person. That can be as simple as deciding where to go for dinner with your spouse to something as complex as brokering the details of a huge corporate merger.

Thomas KilmannAccording to Kilmann’s model there are five basic modes of handling conflict that result from the amount of assertiveness and cooperation you employ. Each of us tend to have a natural, default mode we use when faced with conflict, but that particular mode isn’t always appropriate for every situation. The key to effectively managing conflict is to understand which mode is most appropriate for the situation given the outcomes you’re trying to achieve. Here’s a quick snapshot of the five modes of managing conflict:

Avoiding – Taking an unassertive and uncooperative approach to conflict defines the Avoiding mode. Sometimes avoiding conflict is the best move. Perhaps the issue isn’t important enough to address or you need to allow some time to pass to diffuse tensions. But of course avoiding conflict can also be harmful because issues may fester and become more contentious or decisions may be made by default without your input or influence.

Competing – High on assertiveness and low on cooperativeness, the competing mode is appropriate when you need to protect yourself, stand up for important principles, or make quick decisions. Overuse of the competing style tends to result in people around you feeling “bulldozed,” defeated, and un-empowered.

Collaborating – The collaborating mode is the highest use of assertiveness and cooperation and is appropriate when your focus is on merging the perspectives of the parties, integrating solutions, and building relationships. Overusing the collaboration mode can lead to inefficiency,  wasting time, and too much diffusion of responsibility (because if everyone is responsible, then really no one is responsible).

Compromising – Many times people think compromising should be the goal of resolving conflict. I give up something, you give up something, and we agree to settle somewhere in the middle…hogwash! There are certainly times when compromise is the best route, such as when the issue in dispute is only moderately important or you just need a temporary solution. But if you overuse the compromising mode, you can neglect to see the big picture and create a climate of cynicism and low trust because you’re always giving in rather than taking a stand.

Accommodating – This mode is high on cooperativeness and low on assertiveness which is appropriate for situations where you need to show reasonableness, keep the peace, or maintain perspective. If you overuse the accommodating mode, you can find yourself being taken advantage of, having your influence limited, and feeling resentful because you’re always the one making concessions to resolve conflict.

Conflict is a natural part of any relationship, and if managed effectively, can lead to deeper and stronger bonds of trust and commitment. The key is to diagnose the situation, determine your preferred outcomes, and use the mode most appropriate to help you achieve your goals.

Don’t Feed The Monkeys! 3 Ways To Help People Solve Their Own Problems

Don't Feed the MonkeysIn my early days as a manager I used to love to feed monkeys.

“Monkeys” are the problems, issues, or challenges your employees bring you that somehow become your responsibility to manage and solve. Instead of the monkeys stopping by your office for a quick visit and going back home with their owners, they end up taking residence and you become responsible for their ongoing care.

I liked feeding monkeys because I thought I was helping people solve problems. Over time, I learned my good intentions were actually handicapping my employees from learning how to solve their own problems, resulting in me being overloaded with work.

There are three ways in which I developed that helped me stop feeding monkeys and I believe they can help you too.

1. Become a situational leader – There is no one best leadership style when it comes to managing people. People need different leadership styles depending on their competence and commitment on the specific goal or task at hand. Situational Leadership II teaches a leader to diagnose the development level (competence and commitment) of the employee and then use the appropriate leadership style (a combination of directive and supportive behavior) that will help the person develop from a beginner to an expert on the goal or task. If you don’t develop your employees’ competence and commitment in their job, they will always have to come to you to solve their problems.

Control and Responsibility Grid2. Don’t grab responsibility – One way to look at managing monkeys with your people is to examine how the elements of responsibility and control interact (see my post Losing Control & Liking It – 4 Ways to Handle Responsibility & Control for a more in-depth treatment of the topic). Managers make the mistake of grabbing control of a monkey even though they aren’t responsible for it. Leaders often fall prey to this style of relating because they think they can “fix” people or situations. GRABing control may result in short-term wins, but over the long haul it stunts people’s development and creates a state of learned helplessness.

3. Facilitate self-reliant problem solving – Part of a manager’s job is to help people learn how to solve their own problems. Assuming the manager has been a situational leader and developed the employee’s competence, and isn’t grabbing control of something they aren’t responsible for, the next step is to facilitate the process of problem solving. First, it’s important to have a clear definition of the problem. Many times the symptoms of a problem are more evident than the root cause so it’s important to investigate the underlying issues. Second, ask open-ended questions to allow the employee to think through possible solutions. Many times people just need someone with an objective point of view to help them think through the situation.

In his book, The One Minute Manager Meets the Monkey, Ken Blanchard says “The best way to develop responsibility in people is to give them responsibility.” If you don’t let your people solve their own problems, they’ll always look to you to do it for them. Don’t feed the monkeys!

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