He looked out at his audience. It was made up of his company’s top vendors. “I will take exactly 3 minutes of your time”, he said, “Because I have only 3 things to say.”
“One, I want to congratulate all of you on your quality. Each of you should be proud of your products – we are. On a scale of 1 to 10, I would rank each of you a 10 or close to it. You leave us little to differentiate between you on quality.”
“Two, I want to congratulate all of you on your service. On the same scale, I would rank each of you a 10 or close to it. As with your products, you leave us little to differentiate between you on service.”
“Now, number 3. In spite of the 1st 2 things I have said – or maybe because of them – we will probably not be doing business with +-90% of you any longer. It is simply too expensive. Sending dozens of RFPs and assess each often, negotiate them down cut by cut, and subsidizing a large staff to spend its time on what has become essentially a repetitive operation. In order to economize we need to standardize.”
“Finally, even though all of you try hard to understand our business, none of you really knows it well enough. As a result, we are going to choose 1 or 2 suppliers from each major category and make strategic alliances. We will make our choices on the basis of who among you gives us the most compelling reason. Thank you.”
“Wait!” everyone shouted at once. “What is a compelling reason why you should partner with us?” For the 1st time, the man smiled. “Now at last, you’re asking the right question.”
So, what has happened? What’s changed? What Can You Do to Compete?
- Understand the customer’s challenges
- Learn how to identify, price, and sell your firm’s value
- Understand your firm’s solution(s) to those challenges
Ask yourself: “How does your customer see you?
Just as another Joe Friday (e.g. as added cost)?
OR, as a profit improvement strategy?
See you in the future…
Executive Transformation Strategist (aka “Apps Rat!”)