Category Archives: Peripheral Vision

2 Massive Trends impacting your customers in 2013

scanning a QR code

Understanding the broader customer environment is crucial to managing and meeting their expectations. For example all retailers customer’s expectations have been impacted by the innovations and success of the Apple retail platform. Customers expect to be able to walk in speak to anyone in the store and buy something immediately with a receipt emailed to them instantly. This raises the bar for all retailers regardless of what you sell. This peripheral vision is a core discipline for customer focused businesses.

Likewise there are a number of major trends impacting all customers that will accelerate in 2013.

1. Mobile Computing goes Mainstream

It is predicted that more people will access the web via mobile devices than traditional PCs during 2013. This means companies need to understand the implications and opportunities this presents their businesses. It may simply mean you need to optimize your website for mobile devices. For some companies it means creating mobile versions of their products or services, new apps for the app store or new ways for customers to purchase on the go.

2. Innovative use of QR codes

Target is leveraging its in-store consumer traffic to compete with Amazon by offering shoppers the ability to scan a QR code with their smartphone and have a product shipped for free anywhere. Where this is particularly valuable is when products may be out of stock. Shoppers still prefer to see certain products in person so this is a great way for target to display products and allow customers to make instant purchases. You may recall Amazon has its own barcode scanner application allowing users to scan products in its competitors stores and compare prices. The competition continues to heat up!

Can you imagine a supermarket with no physical stock? Tesco has been testing virtual supermarkets in Korea. Essentially product images with QR codes are displayed on a high resolution poster and busy commuters can scan what they need as they go past and have it automatically delivered anywhere.

virtual supermarket shopper scanning QR codes

The use of QR codes will continue to ramp up in 2013 as businesses test different ways to provide value to customers.

What do these trends mean for your business?

Happy New Year, make 2013 a great year for you and your customers!

The Mobile App Revolution – Why Telcos must reinvent themselves or die

mobile app revolution

New Research by Vision Mobile, entitled “The Telco Innovation ToolBox”, suggests that telecoms must reinvent themselves in order to survive. Their research highlights the need for telcos to transform to the new app culture as new solutions kill off traditional offerings.

The report notes that operators must focus on apps, as most mobile users are shifting from phone models that provide basic services to platforms that give versatile functionalities. A typical telecom platform has only four apps, being voice, text, data and camera, as opposed to mobile computing, which hosts over 700,000 applications.

Telecoms companies are being disrupted because the basis of competition in mobile has fundamentally changed. It has changed from “reliability and scale of networks” to “choice and flexibility of services”, driven by the transition from “mobile telephony” to “mobile computing”. The change is fundamental and irreversible.

Applications such as WhatsApp and other mobile chat apps have threatened revenue from text messaging in various markets around the world, prompting the telecom companies to look beyond the basics and provide solutions for the future.

Most telcos know this, but what is needed to reinvent themelves? They must develop peripheral vision as a cultural attribute that enables them to see current and future market shifts. What is even more critical is a market focused adaptive culture in which people in the organization can make the mindset shift as well as the customer focused practices relevant to delivering value to the new markets.

We can think of today’s technology as “toothpaste technology” – every company has it or can get it. What many don’t have is the customer culture needed to reinvent the business. Those that don’t have it or don’t rapidly develop it will die.

Does your company have the market focused adaptive culture needed to survive fundamental market shifts?

Why global competition means every company must be more customer focused

global competition requires peripheral vision

Global competition is coming to the telecommunications industry in a major way. Yes Skype and others have been around for a long time but direct competition between the telco powerhouses has been slow to evolve.

America’s largest telco, Verizon, is planning to make a push for corporate customers with its secure internet and cloud computing products in the Asia-Pacific region. This move will see it competing head-to-head with Telstra International, the overseas arm of Telstra, the largest Australian telco. Telstra chief executive, David Thodey, recently cited expansion into Asia and more multinational corporate clients as a key strategic priority for Telstra in 2013.

John Harrobin, Verizon Enterprise Solutions chief marketing officer said “We believe that we are positioned to be one of the handful of players worldwide that can serve the mission critical needs of enterprise customers,” The move into the region puts Verizon in direct competition with Telstra, which wants its international arm to sell more global data and telecommunications services to companies with offices around Asia.

Verizon also wants more business with Australian corporations. It already provides telecommunications for some Australian government departments and for companies in the financial services, mining and manufacturing industries. It is also aiming to provide cloud-computing services to medium-sized companies that have only Australian operations,

IT services are moving from an on-premise service to a cloud-based service, and this would be a “massive disruption” in the sector, he said.

For Telstra, this type of heavyweight competition is relatively new and collaboration with new partners in Asia may be necessary. Telstra’s Asian success has been mixed in the past. For Verizon, the Asian markets will pose a new challenge – they will be aiming to sell new disruptive solutions to new customers. This is much tougher and riskier than selling products that everyone understands to customers you already know.

Which company is best positioned to win this battle? Will it be Verizon with its larger infrastructure and resources or Telstra with its traditionally stronger links in Australian and Asian markets? The answer will ultimately turn on the relative strengths of their customer cultures – their understanding of current and future customer needs and the ability of their entire organizations to deliver superior value for corporate customers. Their cultures will need to be resilient enough to understand, adapt to and act on their current and future competitors’ strategies and to have sufficient “peripheral vision” of opportunities that will require product and service innovations.

Do you have a customer culture that enables you to win competitive battles of this type? Does your corporate culture have the “peripheral vision” to identify and act on early warning signals of competitive threats and disruptive market opportunities?

Competing for the future – How Australia Post is reinventing itself in this new age of competition

digital post boxAustralia Post recently released its annual results. Revenues from “regulated mail” – standard postage – are $1924 million and falling, and it made a loss of $148 million. “Non regulated parcels and retail” revenues were up 8.5% to $3073 million, returning a profit of $546 million. An important part of its future will be digital services provided to its commercial customers and Australian consumers.

A starting flurry in this new world is the soft launch of MailBox in November 2012 with a full launch to take place early in 2013. Australia Post has announced that several Australian banks, government departments and utilities will use the Digital MailBox. It will be free to all Australians. It will enable consumers to receive and pay bills, track and manage their relationships with their providers and store all of their important documents in one place. It’s accessed with one password, from any Internet enabled device, 24/7, from anywhere in the world.

Enter Digital Post Australia (DPA), a joint venture between Computershare Ltd, Fuji Xerox Document Management Solutions Pty Limited and Zumbox Inc.

Got that? It’s Digital Mailbox from Australia Post, and Digital Postbox from Digital Post Australia. You can see why Australia post is suing Digital Post Australia  over the name. The first court action was dismissed, but Australia Post is pursuing the action.

At the launch of DPA’s Digital Postbox in early December, CEO Randy Dean ridiculed Australia Post’s launch. “Our competitor recently used its trusted and iconic brand to ‘formally launch’ what appears to be a ‘statement of interest’ for their Digital Mailbox Service. We felt Australians deserved to see what a functioning Digital Postbox looks like and how it operates.” Dean invited consumers to preview the service and activate their “secure and free” Digital Postbox.

Dean says Digital Postbox begins a new era of convenient online mail delivery. “Once the consumer’s Digital Postbox is activated, they won’t need to do anything else. Mail will be automatically delivered online and be available on virtually any web-connected device. Consumers can receive, store and manage important documents such as bills and account statements in a trusted and secure environment. Digital postal mail offers businesses an efficient and cost-effective customer channel that can be enabled using their existing business processes and partnerships and can deliver savings of up to 70% per mail item.”

“We have decades of experience in the secure digital processing, storage, management and printing for the largest and most security sensitive organizations in Australia including banks, government agencies and superannuation funds.

The two companies are now readying their products for market, attempting to pre-empt each other with various pre-releases and announcements. There is no love lost between the two, and their sniping and attempts to define themselves and each other are becoming more intense.

But this is not the only competition. Existing systems like BPay, increasingly sophisticated online banking and now the imminent boom in mobile payments systems are making the technology largely obsolete before it is even introduced.

The eventual winners in this digital environment will be those companies that have a strong customer culture – one in which customer insight and foresight will determine the best way to compete, where the future competition will come from, how future profit will be made.

Australia Post, as a government owned organization, still has a way to go to create and embed a customer culture that will enable it to compete profitably in the digital marketplace.

Product Centric Versus Customer Centric – Does it matter?

Product Focused Companies

A product-centric organization is one that is focused on the products it brings to market rather than the customers that buy those products.

It looks to develop new products by leveraging technology or specialized skills that exist in the company. It starts by looking internally at its capabilities rather than externally at what needs are not being met.

The chart below is a simple comparison of the two approaches:

product versus customer centric companies

In large complex organizations, a product focus provides management with a direct line of sight into which products are selling well, at what profit and clear product owner accountability. While it does simplify the management of a firm it does come at a cost. It tends to create siloed organizations that compete for customers and often lacks a coordinated approach. In fact, many of the poor customer experiences happen as a result of this internal/product focus. The other downside is a myopic vision of the market that blindsides companies to key changes.

What business are you in?

Product-focused companies define themselves by their products. For example, Kodak originally defined its self as being in the photo processing business. This definition impacts the culture of the company in a way that hamstrings thinking and creates impediments to action. When the shift to digital came Kodak resisted this because of the impact on its “products – photo processing”.

The classic example of this is the “Last buggy whip company” the company that made the best buggy whips in America! It just failed to see the car was coming to obliterate its market.

The future for companies is to balance this product focus with a customer focus so that customers feed directly into decision making and are not an afterthought.

What trends are affecting the way your customers solve their problems?

Does your organization suffer from excessive product focus?

Here is a tool that can help – the Market Responsiveness Index

Customer centric leadership – how to paint a vision that inspires action

interbike customer centric leadership

I have been fortunate enough to indulge one of my passions this week, attending the world’s largest bicycle industry show in Las Vegas, Interbike 2012.

This morning for the first time in 32 years they held an industry briefing that was keynoted by John Burke, the president of Trek Bicycle Corp. Trek is an industry leader with more than $800 million in sales and more than 1800 employees. The firm was founded by John’s father, Richard, more than 30 years ago.

However the keynote had nothing to do with Trek, in fact the company’s name was not mentioned once. Rather it was a rallying cry designed to inspire an industry to action.

John began with the good news, the industry is growing with revenues of more than $4.5 billion in 2012. More people are riding bikes more often and the infrastructure around cities in the US has undergone major investments and upgrades over the past decade. But at the same time government funding for new investments in infrastructure have been cut and only 1% of the US population use bikes as a form of transport compared to the world’s leader, Holland with 26%.

John focused on the barriers facing customers to increased participation in what is an activity that addresses the major issues of the day – health and the environment. Specifically it is an infrastructure and safety issue. Most people do not want to share the roads with SUVs, trucks and cars they want safe bike paths that actually take them somewhere they want to go.

John specifically called out the low levels of participation by industry members in advocacy activities design to influence public policy and perceptions and source funding for new projects. Less than 20% of manufacturers, dealers and employees are members of the main bicycling advocacy group Bikes Belong.

Lance Armstrong and John Burke

John Burke with Lance Armstrong a strong Trek Supporter and Sponsored Rider

Today’s keynote was a call to action for the industry to work together to grow the market. With some simple math John showed the impact of small increases in cycling engagement. If the industry could grow participation to 2% it would be a $7.5 billion industry by 2025.

The big hairy audacious goal (BHAG) however was to grow participation to 5% of the US population (remember Holland is 26% and many european countries above 10%) this would result in a $12 billion + industry size by 2025!

At the conclusion of his talk John mentioned there were 4749 days until the year 2025. He brought out two large jars one full of beans and the other empty. From day onwards he would move one bean from one jar to the other everyday to remind himself to be doing something towards fulfilling this industry goal and encouraged everyone in the room to do the same.

He received a passion filled standing ovation. Now that is Customer centric leadership at the industry level!

Why Tesco’s Fresh and Easy concept is struggling in America

fresh and easy miss understands the american consumer

The world’s 3rd largest retailer, UK based Tesco, has been closing some of its “Fresh and Easy” stores in California this year. The Fresh and Easy chain was launched in 2007 with the goal to provide consumers with smaller neighborhood style stores with a variety of fresh organic and reaonably priced prepared meals.

So far Tesco have invested $2billion and opened more than 150 stores in California and are yet to break even.

No doubt Fresh & Easy has run into market obstacles, including California’s weak recovery from the recession but more importantly some of its merchandising practices (commonplace in Britain) have dumbfounded many American consumers.

For example, Fresh & Easy initially wrapped much of its produce in cellophane to preserve freshness. But skeptical U.S. shoppers — accustomed to examining their broccoli and lettuce up close — mistook the wrapping as a way to hide inferior products. American consumers assume produce in plastic bags is not as high quality as those in bulk. This led to an initial lower quality perception that has been hard to shake.

Adding to Tesco’s worries is the fact that many American consumers are conditioned to the idea that”big is better”. While smaller stores maybe more personal and convenient, Americans are used to driving distances to large retail warehouses (think Costco, Walmart etc) and often value bulk buying and competitive pricing over convenience.

There is also strong competition from revamped Safeway stores and the continued excellence displayed by Trader Joes and Wholefoods that really understand their customer base.

So where does this leave Fresh and Easy? They still have time to reposition themselves and find their place in the market but Tesco’s shareholders are getting impatience so they will need to find out what American consumers value most about their store’s value proposition and turn up the volume!

Similarly to Home Depot in an earlier post, Tesco should have started smaller and not ramped up until they knew they were hitting their sweet spot.

A culture that is customer centric, starts with the customer, understands what frustrates them about the current market offerings, builds a solution, tests it, then scales it.

Can Fresh and Easy survive?

The surprising truth about what motivates us..

One of the team recently shared a really great presentation about what really motivates us. The talk, by Dan Pink explores the real drivers of motivation for knowledge workers, that is, people in roles that require them to think critically and creatively about how to get things done.

He gives a number of examples from research. One surprising conclusion is that financial rewards work well for “mechanical tasks” but not for tasks that require more than “rudimentary” thinking. In fact when rewards were provided for more complex tasks, teams provided with the largest reward to succeed performed worse than those with little incentive!

It sounds counter intuitive but in my experience it really does rings true.

If we think about organizations that are really successful, they are not focused on massive financial rewards, they are focused on providing something that is really valuable for their customers. In fact many of today’s really successful firms are still trying to work out their business models, think Facebook and twitter…. they are still only focused on delivering value for customers.

Dan identified three factors were found to drive individual performance:

  1. Automony/Self Direction – the ability to choose how you spend your time
  2. Mastery – the satisfaction that comes with mastering a skill, developing an expertise
  3. Purpose – understanding the broader purpose and how your work contributes to that purpose.

There are parallels with our research into organizational culture. We have found 7 core behaviors that drive business performance and separate average firms from really great organizations.

I can relate them to Dan’s model for individual motivational drivers as follows:

  1. Autonomy is really about empowerment in an organizational culture setting
  2. Mastery – this is really about getting better, getting better requires feedback and insight. In our case getting better is faciliated by gaining customer, competitor and business environment insights
  3. Purpose – again in an organizational setting this is about vision, why do we exist and what do we want to be when we grow up as an organization? This is the factor we call strategic alignment.