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Wednesday, December 30, 2009

Applying Time, Temperature and Turbulence to Marketing

Time, Temperature and Turbulence, the 3 T’s have served me well through my years in the process equipment industry. I used it in the design of thermal oxidizers, thermal fluid heaters and applied these principles to the mixing and drying of numerous products. It was a basic set of principles that you use over and over again.

You can get a feel on how it works by just evaluating your microwave. To improve heating in the microwave, halfway through the cycle you turn the package over, turbulence. If you are on a lower power level, the food takes longer to cook, time and temperature. Even a dishwasher, frying pan, washing machine, dryer or even a carpet cleaning machine follow these basic principles of Time, Temperature and Turbulence. microwave

Can marketing make sense out of these principles? Certainly!

Time: Remember the old saying about frequency and being there day in and day out. This certainly has merit and is still a very important part of marketing today. When most people or even organizations finally get down to the decision making time, inking a contract or writing a check, the safest choice many times wins. Having a well established brand makes you the safest choice. What does it take to have a well established brand, TIME!

Temperature: I equate temperature to how well you address the need. Not only do you need to provide a service or product that addresses their need but you must clearly demonstrate that you do. Review a few jobs that you have lost in the past that you truly felt like you were the best solution. Typically, you will find that it was lost to a well established brand. They were the safe choice. Why? You did not identify clearly, without question, you were the best solution. Clarity – will make you HOT!

Turbulence: This is my favorite, causing a lot of agitation or maybe better said commotion about your product or service. Word of mouth, Gigantic Sales, Star Power and uniqueness are some of the ways to increase turbulence. You have to give people something to talk about! Create a stir!

These are very basic definitions but it is looking at all three of them at once that is the key. Examples:

  1. Lack time (Time): You will have to spend a lot of time in addressing a well defined audience and making a really hot offer!
  2. Lack Uniqueness (Temperature): You will need a longer time to market the product, you must be the tortoise and have some Star Power (testimonials) making you the safest choice.
  3. Lack Proof, Testimonials (Turbulence): You have to take the time to develop the customer’s confidence in your product. It will need to be a much more personal sale.

Time, Temperature and Turbulence works out to be nothing more than math in the engineering world. In marketing, there are many creative ideas that can be spawned using this trio as a guideline. However, it still comes down to math.

The Marketing Equation: Time x Temperature x Turbulence = Prospects

Algebraic rules:

  1. Equations are always in balance:
    1. A increase in any one will result in an increase in prospects.
    2. A decrease of any one will result in a decrease of prospects.
  2. Product of the numbers is the same, no matter the order:
    1. The order should not be relevant
  3. Any number multiplied by 0 is 0.
    1. If you do nothing in one area, you will get nothing.
  4. One multiplied by one is one.
    1. Staying at the status quo will keep you right there.
  5. Any positive number multiplied by a negative number becomes negative.
    1. Mistakes are really tough to overcome.
  6. Two negatives = A positive
    1. Ok, my theory is blown!

 

Photo Credit: by jmv

Related Posts:

Is your customer willing to pay for your marketing?
Lessons learned from evaluating a Puppet Theater

Using DMAIC for your A3 Report in the Lean Marketing House

Tuesday, December 29, 2009

Lean Marketing, The Toyota Way

I recently finished reading The Toyota Way in Sales and Marketing and was astonished by two facts that were prevalent in their marketing strategies. One is that repeatedly they discussed a marketing strategy based on the philosophy of a “Customer for Life.” Now that was not earth shattering, nor was the second fact of improving their marketing through the implementation of continuous PDCA. Neither of these two facts seem remarkable or unusual about the Toyota philosophy. However, what struck was the short term goal of continuo's improvement was in the same sentence as the long term philosophy of “Customer for Life.” We have always been taught to think long term and act short term. However, do we really operate our organizations in that manner. It seems like Toyota does.Captureoo

Not surprisingly, Toyota is very meticulous about any particular process they implement in order to obtain desired results. For an example, How to satisfy, and keep their “Customers for life” as they call it, is arrived at by analyzing their marketing through their customer's point of view. They break down the customers buying process into five steps with each step having its own processes and meeting its own objectives. For example:

Search: The necessary information can be easily and accurately acquired
Visit: Customers can visit a retail location with ease and fun.
Purchase: Customers are given all the options and given the opportunity to be fully convinced with their own decision.
Obtain: Customers can take ownership of their new car with no stress.
Own: Customers can enjoy the vehicle without having to worry about anything.

Another point well emphasized in the book, is that marketing departments that deal with customers on the frontline, are responsible for acting as an antenna in order to fulfill their mission of being the “Radar for all of Toyota.” Through all of this, they pride themselves that their sales and marketing system continues to evolve on a daily basis. The basis for this information is the five chapters of the Silver Book, which is the guiding light in Toyota Marketing.

I have always wondered why Lean marketing is seemingly an uncommon word when Toyota happens to be one of the best marketers on the planet?

P.S. The Toyota Marketing Funnel is depicted in a continuous loop? – HMM!

Related Posts:

A Little more on applying Little’s Law to Lean your Marketing!
Using DMAIC for your A3 Report in the Lean Marketing House

Tuesday, December 22, 2009

What kind of questions would you ask at a tollgate?

Capturerr In a recent post, Using the Six Sigma Tollgate in your Marketing Funnel I went through the concept of using a tollgate in your marketing funnel. Below is a list of questions that might help general a few ideas that you may want to consider. The list was derived from the book Implementation: How to Transform Strategic Initiatives into Blockbuster Results. Intentionally, I left it very generic. 

Define stage:

Why is the change necessary?
What is the proposed scope of this project?
What if we do nothing?
What alternatives have been looked at?
What will be the key objectives for this project?
What is out of scope?
Who is the sponsor for this project?
Who are the key stakeholders?
What are the principal risk to success?

Measure:

What specific benefits of this project deliver?
How will this project contribute to our goals?
What budget and resources will be required?
What assumptions and constraints should be considered?
What dependencies or interfaces should be considered?
What are the major project deliverables and milestones?
Who will manage this project?

Analyze:

How will all the work is scheduled?
Who will be responsible for each work package?
How will identified risk be manage?

Improve:

How are we progressing against our schedule?
How are we doing against budget and resource requirements?
What issues do we face?
What new risk have been identified?
What changes do we need to make to the plant?

Control:

Have we completed our handover to the users?
Have we closed the project and communicated where needed?
Have we captured useful knowledge and lessons learned?
Have we evaluated the results that we have achieved?

P.S. Implementation is a great book to have as a companion before, during and after providing the leadership in a project management process. It is on my trashy section on my bookshelf with other highlighted, written in and dog-eared page books.

Related Posts:

Improve your Marketing Cycle, Increase your Revenue

Speed may be the biggest Determent to your Marketing Success

Tuesday, December 15, 2009

The Marketing Funnel using Six Sigma DMAIC – Analyze Stage

The first 2-steps of the DMAIC process answered the questions: What is important and how are we doing? We also considered the marketing funnel stages of Awareness and Consider. The third stage of the process in DMAIC is Analyze and in the Marketing funnel it is Prefer or Trust. This is also time to reiterate that the thinking process must be about the external customer. Analyzing is about finding ROOT CAUSE to the already described process steps of Define and Measure.

Are listening to your prospects requirements and measuring yourself on how you are performing based on those requirements? Are you correct? Have you properly identified, verified and quantified the root causes of their pain and statistically linked input with output? If this seems mind boggling, you are at the proper stage. Now, is the time to make sense of all the data and confirm the validity of it? This is the time that so-called common sense can get in the way. Even at the most basic level of Six Sigma training, examples are given of problems that be reviewing the data there seems to be an obvious answer. It is simply an eye-opening experience when you input the data into a statistical program such as Mini-tab and see the results. If you would not have analyzed the problem correctly, you may have been working on a problem that did not exist and as a result have little impact. Remember the old adage, numbers do not lie! However, garbage in will equal garbage out, verification of the data is extremely important.

FishboneUsing a high level process map or as I prefer, a Value Stream Map is important. The visualization of the process will help as you analyze the data. The first several times you do this, it may only involve several simple tools such as a Fishbone Diagram and/or a Pareto Chart. This also the stage we look at Value-Added activities.  We can very often find many things that are adding little value from the customers’ point of view at this time. Sometimes significant reduction that will pay for the entire improvement policy can be found in this stage.   

 

As a customer, I may have entered your funnel with a specific problem and now have determined that you are someone that I should consider. It is time for me to analyze your organization and start developing preferences. How does my marketing play this role? My marketing at this time needs to identify your root cause. Are you identifying it? I believe that it is very difficult for a prospect to move from consider to prefer without having their root cause addressed. If you start with the definition of the problem you solved and take a marketing segment or even an individual prospect and use a tool such as the fishbone diagram, you will be able to determine whether you product or service addresses root cause. If it does not, is there a reason to continue with this customer? Is it a good fit? Maybe, there is a better product or service you should be offering?

Definitions:

The Fishbone Diagram, also known as the Cause and Effect Diagram or Ishikawa Diagram, is a graphical construct used to identify and explore on a single chart, in increasing detail commonly using the 5- Why technique, the possible causes which lead to a given effect. The ultimate aim is to work down through the causes to identify basic root causes of a problem.

A Pareto chart, named after Vilfredo Pareto, is a type of chart which contains both bars and a line graph. The bars display the values in descending order, and the line graph shows the cumulative totals of each category, left to right. The purpose of the Pareto chart is to highlight the most important among a (typically large) set of factors. In quality control, it often represents the most common sources of defects, the highest occurring type of defect, or the most frequent reasons for customer complaints, and so on.

Related Posts:

The Marketing Funnel using Six Sigma DMAIC Methodology
Using DMAIC for your A3 Report in the Lean Marketing House
Analyzing Failure on Projects
Analyzing a complex problem, make it simple by using…

Picture courtesy of Systems2win.

Monday, December 7, 2009

Why Social Media is so Lean

Wikpedia: Lean is basically about doing the right things, to the right place, at the right time, in the right quantity while minimizing waste and being flexible and open to change.

Lean actually got its name from the best selling book, The Machine That Changed the World: The Story of Lean Production-- Toyota's Secret Weapon in the Global Car Wars That Is Now Revolutionizing World Industry. This management classic was the first book to reveal Toyota's lean production system that is the basis for its enduring success. The next book on Lean, Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated by Womack and Jones, introduced five core concepts:

  1. Specify value in the eyes of the customer
  2. Identify the value stream and eliminate waste
  3. Make value flow at the pull of the customer
  4. Involve and empower employees
  5. Continuously improve in the pursuit of perfection.

These concepts have stood the test of time and are still used as the foundation in Lean thinking through out the world. But as I review these concepts look how readily they apply to social media and marketing today.

Specify value in the eyes of the customer: Social Media has brought on a wave of content marketing. As a result, we have more FREE information available instantaneously today than ever. Social Media is about supplying value to the customer. The essence of Social Media is the interaction and discussion. Book Recommendation:  Trust Agents: Using the Web to Build Influence, Improve Reputation, and Earn Trust

Identify the value stream and eliminate waste: To be effective in Social Media, you have to understand your value stream and do what is important to your customers. If you try to do everything, you will be quite ineffective and realize very little results, if any. Book Recommendation: Get Content Get Customers: Turn Prospects into Buyers with Content Marketing

Make value flow at the pull of the customer: Costumers find you in Social Media by your activity, not by your bombarding of messages. Book Recommendation:  Inbound Marketing: Get Found Using Google, Social Media, and Blogs (The New Rules of Social Media)

Involve and empower employees: Social Media is about transparency and authenticity throughout are entire organization. More people are communicating with each other at all levels of our organizations then ever before. We have no barriers. World Wide Rave: Creating Triggers that Get Millions of People to Spread Your Ideas and Share Your Stories

Continuously improve in the pursuit of perfection: The bar is raised for us everyday. The people that are falling behind in Social Media may not recognize the world tomorrow. Do you have to jump in and spend vast amount of time in this world. No, not at this point. however, you need to have you not only your toe but a rather large portion of your foot in testing the waters. If you are participating in Social Media, the result of it will be continuous improvement. Shameless Plug: Duct Tape Marketing Social Media Pro hosted by Business901.

 

These concepts have stood the test of time and are still used as the foundation in Lean thinking through out the world. But as I review these concepts look how readily they apply to social media and marketing today.

Friday, November 27, 2009

A Little more on applying Little’s Law to Lean your Marketing!

In a previous post, I transformed Little’s Law to marketing utilizing this formula: Marketing Cycle Time = Customers in Process / Closed Sales. I would like to simplify this formula and change the nomenclature a little. I think more accurately it should be called Sales and Marketing Process Time(SMPT) = Prospects in Process(PIP) / Customers(C). You could also use the same formula substituting Prospects for possible Revenue opportunity and Customers for Revenue.

However, if you put your Theory of Constraints hat on for a second, you would consider Revenue as the Throughput. Though this is not a major change in thinking, Throughput is the measure that drives Theory of Constraints. In your marketing process, this makes perfect sense, you should be measured in Sales Revenue, correct?

Reviewing some basic teachings of the Theory of Constraints, you may start looking at your marketing process a little differently. If you believe reducing your SMPT is important you simply have to reduce the number of Prospects in Process (PIP) if your Throughput(TH) or Customers(C) stays relatively constant. If you have large amounts of PIP it is a pretty simple task. However, the question maybe, what if you don’t have enough prospects in your pipeline?

You know your SMPT is a function of all of your process time. It represents all the stages of your Marketing Cycle both value added and non-value added time. So to reduce cycle time you must reduce value added, non-value added or a little of both. Since common sense dictates that non-value added time makes up for the majority of the time and if anything you would like to increase value added time, you must attack the non-value added part of the process.

We must accept the fact that there is waste in all processes, and we must work on a continuous basis to remove it. As we remove waste, another large culprit of efficiency is variability will be reduced. However, the other item that Little’s law demonstrates is the PIP in the process. As we evaluate this number think about the cost of having access PIP. Not having a targeted market, you may waste mailings, telephone calls and a few other inexpensive items, but I think about this on a much grander scale. Think how much you may be diluting your message. Can you afford to do that? You have heard me discuss how clarity may be the single most important reason that you lose prospects or sales. You cannot increase value-added time or decrease non-value added time without clarity.

How do you increase clarity to your prospects? Again, hopefully this does not sound like too much like a broken record but there are only two choices: reduce the number of prospects or segment your list or both.. Effective segmentation may be your single biggest constraint in improving sales. What do you think?

Related Posts:

Great Resource on the Theory of Constraints: Ebook on Integrating Theory of Constraints with Lean Six Sigma

Improve throughput, cut your customers in half!

Lean your Marketing thru Segmentation

Thursday, November 19, 2009

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Wednesday, November 18, 2009

Using Value Stream Mapping Software

There is a lot of dispute about Value Stream Mapping software, and whether it should be used or not used. Most Lean practitioners will tell you that early introduction into converting your Value Stream Map into a computer generated document will hurt the overall flow of the procedure and be a detriment to the brainstorming process. They prefer using post-it-notes or pinning paper to a wall. Allowing as many people to interact is the whole point. I have a tendency to agree with the statement. Participation, interactivity is the key. In fact, when I build a marketing calendar for a company, I do the same thing. Even taking advertisements, direct mail pieces, etc. and pin them to a wall.

It works great except…many times it seems that I am explaining the process along the line. I end up teaching what a Value Stream Map or even a Marketing Calendar is and the purpose, we are doing it. Sure, I know that should all be done before hand but do we? Do we take the time? Many lean practitioners work hard to help an organization to improve their Lean skills. This is a slow, difficult and often frustrating part of the process. Computer-supported Value Stream Mapping may help Lean practitioners be more effective in this respect. Creating a simple mapping process for them to input into the software and through the use of the help section, both written and video supported, would not hinder the mapping but facilitate the actual process in the Value Stream Mapping Process. Explanation of the key concepts and how they are used would make the best use of everyone's time.Balance

When setting initial assignments, don't require that a map be drawn but have a procedure to check off that the different nomenclature was understood. This will give most individuals solid footing for the meeting. You may want to do a webinar on VSM to facilitate the mapping process. Use the tutorials embedded in the software as a basis of discussion. This way there will be a reference point for everyone afterwards.

A better way, for those with both the technical agility and a suitably equipped classroom, is to do "live" mapping and update the actual process constructed on the wall every 15 minutes or so. Having a reference point can be very handy when you are taking down a stray path. This would also enable a wider audience as actual attendance would not be required. Especially in supply chain applications, you could have numerous suppliers and/or downstream and upstream customers participating from a distant. Another feature is that you may choose to schedule times when different participants would be available. Mapping in real time, can be difficult and beyond the scope of many organizations. However, if it is possible, it gives you instant documentation for the entire organization and a basis for a process that I would refer to as a true Value Stream Management process.

It should already be apparent that handling mapping can be a very different experience than is had when using the traditional method of post-it-notes. Value Steam Mapping represents information more densely and makes more information immediately available to the mind. It supports a wider range of interaction, which is ultimately what we are after. That said, these are the early days in computer supported mapping.  For now, there needs to be a balance, but it is changing. I predict that since it is not a technology issue but a policy constraint that it soon will be common place. If not, you may be the like an accountant dealing with a system of ledgers and manual entries and Turbo-Tax has largely replaced that group.

P.S. I market Value Stream Mapping Software on my Site.

Related Blog: Why would you use Value Stream Mapping?

 

Tuesday, November 17, 2009

Greater Marketing segmentation = Increase Revenue

Today’s products and services reflect greater marketing segmentation. As you know, I use the Duct Tape Marketing Hourglass as The Pillar of the Lean Marketing House but there is no universal terminology, it is just convenient to stay with one message because even as you segment your list you still have to recognize the marketing process into stages such as Know, Like, Trust, Trial and Buy.

As you segment, each segment will include fewer customers. However, it should enable you to identify the individual stages more effectively or determine your material and information flow needed in each step. It will also allow you to define waste and create better value for your customer. In fact, this is basically the definition of Value Stream Mapping.

As a result of this exercise, you will change the shape of your Pillar. You should be able to shorten your cycle in some and as a result decrease your expenditure in the marketing process. Others, on the other hand, may be lengthened and a total different approach may have to be utilized. A good example of this may be in the pursuit of a governmental contract. The point to be taken is that there is nothing wrong with either situation, what is wrong is treating each segment the same.

The key ingredient to get started is developing the NEED statement for each marketing segment or Pillar. The statement should clearly define your CUSTOMER’S CORE PROBLEM and your ability to solve that problem. Defining this alone will provide clarity throughout the various stages in your marketing process. The NEED statement is a living document that will evolve as your product/service and the customer’s use of it changes. Further development of this statement should include limits on cost and time to keep your Pillar within boundaries that you are able to manage.

The point of defining the Need Statement is to succeed at developing a manageable process. We want the resulting marketing phases (Know, Like, Trust..etc.) to meet our customer’s needs, at the right time and at the right cost. It must do this in a way that maximizes our investment in the process. Marketing can be a complex and often risky process and in today’s world it mandates speedy development. The Lean Marketing process is geared to provide a framework and specific tools for efficiently and predictably reaching goals.

Related Posts:

Following the Customer’s Need in your Value Stream Map

 The Pillars of the Lean Marketing House

Value Stream Mapping for Marketing

Get Rid of Your Marketing Vision Statement and Address the NEED!

Why do The Pillars of the Lean Marketing House™ crumble?

Applying the Marketing Hourglass: The Pillars of the Lean Marketing House

Sunday, November 15, 2009

Business Plan Mistakes

Affiliate Post of the Week: Business Plan Mistakes

By Palo Alto Software, Inc.

Often you may hear about what a business plan consists of. While including the necessary items is very important, you also want to make sure you don't commit any of the following common business plan mistakes:Business Plan Pro

1. Putting it off: Don't wait to write a plan until you absolutely have to. Too many businesses make business plans only when they have no choice in the matter. Unless the bank or the investors want a plan, there is no plan.

Don't wait to write your plan until you think you'll have enough time. "There's not enough time for a plan," business people say. "I can't plan. I'm too busy getting things done." The busier you are, the more you need to plan. If you are always putting out fires, you should build firebreaks or a sprinkler system. You can lose the whole forest for paying too much attention to the individual burning trees.

2. Cash flow casualness: Cash flow is more important than sales, profits, or anything else in the business plan, but most people think in terms of profits instead of cash. When you and your friends imagine a new business, you think of what it would cost to make the product, what you could sell it for, and what the profits per unit might be. We are trained to think of business as sales minus costs and expenses, which equal profits. Unfortunately, we don't spend the profits in a business. We spend cash. So understanding cash flow is critical. If you have only one table in your business plan, make it the cash flow table.

3. Idea inflation: Plans don't sell new business ideas to investors. People do. The plan, though necessary, is only a way to present information. Investors invest in people, not ideas.

Don't overestimate the importance of the idea, particularly the importance of the uniqueness of the idea. You don't need a great idea to start a business; you need time, money, perseverance, common sense, and so forth. Very few successful businesses are based entirely on new ideas. A new idea is much harder to sell than an existing one, because people don't understand a new idea and they are often unsure if it will work.

4. Fear and dread.

Doing a business plan isn't as hard as you think. You don't have to write a doctoral thesis or a novel. There are good books to help, many advisors among the Small Business Development Centers (SBDCs), business schools, and there is software available to help you (such as Business Plan Pro, and others).


Marketing Plan Pro5. Spongy, vague goals:
Leave out the vague and the meaningless babble of business phrases (such as "being the best") because they are simply hype. Remember that the objective of a plan is its results, and for results, you need tracking and follow up. You need specific dates, management responsibilities, budgets, and milestones. Then you can follow up. No matter how well thought out or brilliantly presented, it means nothing unless it produces results.

6. One size fits all: Tailor your business plan to its real business purpose. Business plans can be different things: they are often just sales documents to sell an idea for a new business. They can be detailed action plans, financial plans, marketing plans, and even personnel plans. They can be used to start a business, or just run a business better.

7. Diluted priorities: Remember, strategy is focus. A priority list with 3-4 items is focus. A priority list with 20 items is something else, certainly not strategic, and rarely if ever effective. The more items on the list, the less the importance of each.

8. Hockey-stick shaped growth projections: Have projections that are conservative so you can defend them. When in doubt, be less optimistic.

Source: bplans.com

Tuesday, November 10, 2009

A3 Marketing Reports

The definition of an A3 Report is a simple storyboard that tells the whole story of an improvement event on one 11x17 sheet of paper. The left side defines the problem, the right side proposes solutions. That is the basic structure. However, A3 is much more than that. It is the tool used to implement the PDCA process. Understanding A3 thinking and you can apply this to problem solving, proposals and status reports. But you have to pick a template and you have to follow some outline in creating an A3 to get it off the ground.

Typically, when I create an A3, I go about it a little differently by utilizing the Six Sigma principles of DMAIC. This acronym stands for Define-Measure-Analyze-Improve-Control. The Six Sigma process improvement process(DMAIC) is closely related to the PDCA lean process. The difference is the set of tools being utilized. I believe DMAIC has a stronger set for variation and process control. The PDCA process has a more simplified version. Depending on your needs either tool applied appropriately can be utilized. Lean has a tendency to be favored initially because of the lack of measurements within most organizations. The important part is that you start the process.

The chart simplifies the DMAIC process to a much simpler nomenclature:

  • What is important?
  • How are we doing?
  • What is wrong?
  • What needs to be done?
  • How do we guarantee performance?

Whether you decide to use DMAIC or PDCA for your A3 makes little difference. The tools are just that, tools. The important part is that you have flexibility to format your A3 report in any way that most effectively can tell and demonstrate your story to your team and others. Your goal is not to complete the A3 report, it is to harness all the benefits through implementation from the problem solving that took place.

You have heard me say that I use A3 Reporting in the marketing process. It demonstrates and recaps the thoughts, efforts and actions that took place for a particular campaign, such as advertising or public relations or even a launch. This report can really highlight the value that marketing supplies. I will be discussing DMAIC and how it applies to the foundation of the Lean Marketing House™ in the upcoming weeks.

Related Information:

Lean Six Sigma Templates for DMAIC and A3

Why use A3 in Marketing

Why do The Pillars of the Lean Marketing House™ crumble?

Lean Marketing House™ – Foundation

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Friday, November 6, 2009

Applying Little’s Law to marketing

Most marketing systems are out of control. They just have not been managed with understanding the process speed and the effect of the flow on the process. Understanding some of the drivers of this process is much simpler than you might think. A simple equation called Little's Law can tell us how long it will take any prospect to be turned into a sale simply by counting how many customers are in your funnel and how many sales we complete each day, week, etc.

Marketing Cycle Time = Customer in Process / Closed Sales

Little's Law is a pretty cool tool and more important than it might seem. Many of us may not know what our average marketing cycle time is, let alone the variation of it. But knowing when someone enters your Marketing Funnel and when they exit it might seem immeasurable. The thought of having to track a prospect through all the stages in the process may seem rather daunting. However, with Little’s Law and segmentation of your individual channels, you can get a reasonable estimate of these factors. We only need two of these factors to get the third. It is just math! We need reliable estimates but if you look at segmentation closely and how Little’s Law applies you can go a long way in getting some very useful numbers. If you know your customers and the process and how many sales you are closing you can estimate your cycle time. If you know your cycle time and the number as sales you close, you can estimate the amount of customers in your process.

These customers will be waiting between different stages or activities. It may be either internal or external reason but for this conversation it is not important. In lean, we consider this as someone’s queue time. This time in waiting (queue time) counts is a delay, no matter what the reason. As you begin to track your customer’s flow it soon becomes obvious that some of your activities from the eyes of your customers are of little value. A critical metric of waste for any process is what percentage of the total cycle time is spent in non-value added activities and how much of this is waste. The metric used is process cycle efficiency, which relates the amount of value added time to the total cycle time of the marketing process. Typically, marketing cycle efficiency of less than 10% indicates that the process has a lot of non-value added time or added wasted opportunity.

Marketing Cycle Efficiency = Value-added Time / Marketing Cycle Time

Waste is any time, cost, etc. that has no value in the eyes of your customer. All organizations have some waste. Lean shows us how to recognize waste and by utilizing these two simple and doable formulas. Don’t accept that Marketing is not measurable, it is!

Even Strong Pillars can crumble?

Most organizations build their pillars at the strategic business unit level, in the marketing departments within the business. However, they must include and receive buy in from customers, sales and other parts of the value chain to make it work. If it is pushed down it will seem like just another program. Hourglass Broken

Once we have designed The Pillars of the Lean Marketing House™, we need to implement it throughout the entire organization. This requires careful planning and coordination with all parts of the organization. It is beyond the scope of this post to go into an entire Product Launch but we basically should know, how to organize, coordinate efforts and establish deliverables within the organization. Also, we should have knowledge of the time, availability of data and the resources needed. Another important aspect is the degree of support and funding both in time and money that management is willing to commit too.

When completed, The Pillars provide clarity, the budgetary requirements and a platform for management to buy into and support. However, it lacks the foundation needed for implementation and measurement that is required for successful deployment. We will need to integrate the Hourglass into lower level blocks or the Foundation of the Lean Marketing House™. The blocks provide the stability to the The Pillars of the Lean Marketing House™. They are made up of the tactics we will employ to move prospects from one stage to another. As we move the forward, a more formal collection and reporting system will emerge. Once we get more and more blocks working, we will begin to link the different segmented pillars together.

Building The Pillars of the Lean Marketing House™. often require continuous testing and modification to see if the process is working. This can be frustrating for many who routinely expect perfect solutions. Many times you are testing something that you never had applied or had measurements before. You will revisit your pillars, adjusting and re-aligning it to fit with the organization. It is not unusual to postpone the rollout of pillars until the first pillar is well established and working. The foundation of the Lean Marketing House™ will be explained in upcoming posts.

Related Information:

Lean Marketing House - Foundation

The Pillars of the Lean Marketing House Webinar

Duct Tape Marketing

Wednesday, November 4, 2009

Do your Map your Value Stream backwards?

In the book, Learning to See by Mike Rother and John Shook, they recommend a mapping tip of beginning the Value Stream Mapping process by walking downstream from the customer end. This way, they say you will begin with the processes that are linked most directly to the customer. As I was reading, actually re-reading the book, I thought how simple and intelligent that statement was. Starting at the end of the process should be the logical thing to do if you are considering developing a pull system. It is the beginning. This is very similar to my thoughts I expressed in my Mirror Marketing E-book.


Mirror Marketing E-Book

In a marketing perspective, how often do we really consider what our customer is real needs are. I find it interesting in a recent study by Rain Today they cited that the number one reason that most professional service sales are lost is CLARITY! I think it might also be said for many product opportunities. It might not be directly, but if your product or offer was fully understood before the purchase decision was made, would that improve your closing rate?

So do things become clearer walking backwards? Try this old golfing trick, walk your favorite golf course backwards. Does the out of bounds, elevations and other danger seem entirely different? Why not put yourself in customer shoes? In Six Sigma perspective, we call this process Voice of Customer but do we really consider the metrics of delivery performance, number of defects, invoice accuracy and other views that the customer is experiencing.

If you have a customer that will take the time with you, try having him draw a process map of your product. Or just blue sky the different experiences that he has with your organization. How accurate are they? After that, have them draw a future state. What would they like to see from your organization? Are you willing to deliver that experience?

Sunday, November 1, 2009

Delivering in the NOW time

If you want to be successful in today’s market consider using this tag line. What reminded me of this is discussions I have had with Jeff Slater of Sonoco on the Supply Chain, Bob Sproull, author of The Ultimate Improvement Cycle and this recent video on the American Express Open Forum, Delivering What the Customer Wants.

Customers are demanding shorter Supply Chains and more customization. Their trade-off is that they are willing to wait for a very short-on-time delivery and the faith not that the product or service will be perfect, but that it will be supported and corrected if there is a problem.

The internet has made people accustomed to buying things sight unseen if they have trust in the people and organizations behind the product. Does anyone mind when the product says Beta on it? now

However, how can a company make money with customization and supply chains being the 2 biggest drawbacks to efficiencies? The first thing I would let go of is the word efficiencies. That seems to me an out-dated word still being used by cost accountants. The Theory of Constraints utilizes measurements using the term of Throughput which I believe has a lot more bearing on the health of a company. Most companies also fail to realize that the “asset” of inventory actually penalizes you in your supply chain and typically reduces your time to market.

Delivering in the Immediate Moment is typically not about production time, it is about policy constraints and having a supporting system in place to support that goal. Building a Value Stream Map can clarify many of these issues. However, first things first, remove the word efficiency and add the word throughput to your vocabulary.

Related Posts:

Theory of Constraints + Lean + Six Sigma = Ultimate Improvement Cycle

Lean Six Sigma applied to Supply Chain

Application of Lean Six Sigma to the Supply Chain

Wednesday, October 28, 2009

How do you add value in your marketing? Have you thought about it? To be effective in Content or Educational Marketing you must add value as defined by the customer.  I want you to steer away from your first thought, which is more than likely your product or service, but instead think about your marketing material. For your Content marketing material to be effective, I believe it must have 4 components:

Value Added: Your marketing needs to add additional knowledge or be a reinforcer of your product or service to your customer. A blog or commenting on LinkedIn are several online examples. It can be done in traditional advertising and marketing. Using a 2-step advertising strategy and offer something of value versus trying to coerce them into buying a product. Especially consider your marketing message in each step of your marketing process. I believe that if you are effectively using the Pillars of Lean Marketing House properly that you need to increase the value of your offering as you walk someone through the process. You must also segment your list during the process so that the perceived value is also recognized.    

Quality:  If you look at marketing in today's world, I believe authenticity is sometimes more important than a professional full color ad in your trade magazine. People want to become connected, just review some of the YouTube videos of BelndTec and the Will it Blend series. Variability is the lager culprit of quality. It goes without saying, your marketing should be professionally looking, but I believe the biggest problems with quality is variability.  It confuses the message to your customer. When you dilute your marketing message not only by confusing advertising but sometimes being in the wrong place, even with the wrong customer, can send mixed messages to your target market.

Time: Delivering your message when a customer needs it, is imperative. Before or after the proper time reduces the value tremendously. Few customers will put it in a file and save it for when they need it. We are simple on information overload – ALL THE TIME. The timeliness of your message is important to understand. You seldom can do this without understanding your customers buying cycle and the needs they have during that cycle.

Cost: This is a little of a 2-way street here. One you must consider your own cost and the ROI on doing the particular piece. You have to determine if a Super bowl Ad is worth it. However, when I consider the marketing piece I am going to employ, I like to think of it in a different way. Is the content something that the customer would pay for? If this does not raise the bar on your marketing, you are doing a lot of things correct. If you had a free whitepaper to download, why not sell it on Amazon for $2.00. Is is worth it? Is not relinquishing my e-mail address and giving you permission to market to me worth $2.00.  Look at your marketing material and put a value to it! Better yet, ask your customer if there is a value to it? Would it be great if your customer was willing to pay for your marketing?

Related Information:

Value Stream Mapping

The Pillar Worksheet

Lean Marketing House Overview – Video

Related E-books

Monday, October 26, 2009

When those old guys say stuff, you should listen!

I am working and creating some examples for the Lean Marketing House, and I wanted to create several A3 reports on several pieces of the foundations. As I was struggling to get started, I remembered what my first Lean teacher told me: Start with 5S so that you don't spend your time on anything wasteful and then do Standard Work. Most people know what 5S is but Standard work may confuse a few. Standard work is a simple written description of the safest, highest quality, and the most efficient way known to perform a particular process or task.

There is no secret to standard work. Watch several people do the same task and see the difference. Is there much variance built into it? Why would I care about this in marketing? Just using the procedure for creating an ad or a direct mail piece. If there is a lot of variance in the production do you think the schedule will be met? More importantly, will the best use of creative time be used or are you the type that works better under pressure!!! The key to standard work is keeping it clear and simple, so staff can quickly and accurately complete their work.

Std Work

When I started doing the standard work for a procedure there really was not one in place. I know it sound kind of corny, but really go to try to create an A3 report without a standard, it was next to impossible. I thought an A# was supposed to make it easier. But the old guy was right, you have to know what you are doing before you improve on it. The photo of a Standard Work Template is provided by Systems2win.

As Taiichi Ohno said - "Where there is no standard, there can be no kaizen."

Related Post;
Lean Marketing House Foundation

5S - I did a set of stupid Videos on 5S in marketing a while back.

How much planning is enough - Use Lean and Standardize

Value Stream Mapping

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Thursday, October 22, 2009

Marketing Idea of the Week!

I was reading Success Coaching U Blog and Joe wrote an article about Ready, Aim, Fire. Good headline, you already can guess what the headline is about, Target Marketing. I remembered a piece of advice I received from another Duct Tape Marketing Coach on targeting your direct mail, which I call the Machine Gun approach. For obvious reasons, I won’t disclose the source, but the following statistics were shared:

I don't have a success story, I have a sobering story. Here it is:
   Number of pieces mailed: 10,000
   Response rate: 1%
   Number of inquiries: 96
   Number that you manage to reach by phone to qualify: 70
   Cost of qualifying by phone, per inquiry: $30
   Number who turn out to be qualified leads (20%): 14
   Total cost of qualifying ($30 X 70): $2,100
   Campaign cost of $10,000 + phone qualifying cost = $12,200

Total cost of $12,200 divided by 14 qualified leads = $871.42. In other words, you must spend $871.42 to get to each lead who needs your product or service, can afford it, has authority to buy, and is ready to buy now. Not so good for a small business....army  helmet and bullets

I will call this method the Machine Gun Marketing. Another method of Machine Gun Marketing is the Marketing Idea of the Week.  You have an Ad Rep call on you and they have this special 3 for 2 deal. Plus they have this even that they will be attending and handing out another 1,000 pieces of whatever they are selling. Oh yeah, you will also be exclusive to your area of expertise and we will even create the ad. What a deal! But….you will have to do something by Thursday, this being Tuesday. Sounds like a great idea?

If it is not part of your overall marketing strategy, if it not targeted, and I mean really targeted, and you have extra cash in your marketing budget that you were just clueless on how to spend it and you have no collateral material supporting it and you cannot create the ad yourself(a two-step ad, by the way), and you already know how you are going to measure it and….. I have asked Ad reps, that I do not respond to this type of marketing, many have stopped calling. I wonder why…has their machine gun jammed or just ran out of bullets? 

 

Wednesday, October 21, 2009

Value Stream It’s just not about the Value

Applying Value in your Marketing process is not the only thing that is important. In today’s marketing managing the stream is becoming equally more important. I alluded to this concept when I discussed E-mail providers in a previous post. I concentrated on the value and the touch points within your Marketing Hourglass. Just as important though is the Stream or Flow of the process. Without managing this, you will end up creating a great deal of wasted effort in your marketing process.

Of course when I start discussing flow, I am going to start discussing Theory of Constraints. In your marketing process, you will have numerous constraints but Goldratt claims that at any given time, there is only one constraint. That constraint is much like the neck of an hourglass and will limit the entire system. Actually, if it is well managed you could throttle your process accordingly (We only wish we could that). Simply doubling the efforts in a constraint could be the easy solution and may just move the constraint to another area. However, we operate in a more complicated world than that. Something else usually cases something else to happen.

What is that something else? It is the marketplace. What we see in our constraints may not be problems but indicators. If we treat the perceived problem without really determining the root cause we just may go in a merry-go-round. It would be like just adding sales people. You could double your sales capacity and that may or may not increase sales. In fact, what typically happens is additional responsibilities are given to salespeople and you off-load other stages of your Marketing Hourglass to them without increasing sales. You did not find your root cause. The good or bad part is that your indicator will return because the constraint really never went away.

David Armano just wrote a blog post on Dynamic Signals for Business and how rapidly dynamic signals are transmitted and received. He discusses how Google has organized the Web by figuring out who has authority, but now the real-time Web behaves differently. It is about trending topics, and SEARCH JUST CAN’T REACT QUICK ENOUGH. He goes on and discusses how he receives trending information, and what they mean to him.

So marketing today has to address value and the content they are distributing. However, as importantly, they have to address the time or the stream of their marketing system. The acceleration or throughput is extremely important. Creating systems within our process that are efficient and propels customers through the Marketing Hourglass or Sales Cycle is imperative. Our days of leaving non-responsive customers on our mailing list, online or offline are ending. Creating advertising to the masses and expecting a reasonable return have already ended for small and maybe even medium size businesses. These statements are not meant to say that we only market to someone for 90 or 120 days and that’s it. It is more inline that we have to create interactive platforms that allow our customers to interact at their leisure, their timing and at their discretion. A good description of pull marketing, but how do you manage a stream?

You must understand your Marketing Stream well enough to have a throttle. You must know here your constraint is, maybe even on a seasonal basis. You must address indicators that are built into your process and not built into month-end reports. I look at my Google analytics daily. If I see web traffic dropping from referral sites, I realize that I am spending too much time pushing my message versus participating with others.

What are the real-time indicators within your business? Do you have a monitoring system that lets you know? Do you adjust your marketing message accordingly? Are you improving your stream with better information to qualify yourself to the customer? If you are proving a higher value of information to the customer, does that propel them through your marketing hourglass?

If you believe that your referral process is a sub-standard or your constraint, it may be a way to create an immediate impact in your process. Applying a couple of these principles to the bottom of the Duct Tape Marketing Hourglass in the refer stage. If you worked in this area alone and increased testimonials and referrals, what would it do for you? Could you reduce the time spent in your hourglass? Do you give every customer the opportunity to refer and to provide testimonials?  Try a few of ideas and see if you can get a handle on your throttle.  

valve in center

P.S. I have a Lean your Marketing thru Referral Power Group starting soon!

Get Rid of Your Marketing Vision Statement and Address the NEED!

Most organizations try to develop a meaningful marketing vision statement designed to guide their action for today, tomorrow and in the future. The vision statement serves as a platform for all their marketing goals.  Armed with a vision, you establish your marketing goals, which are time-sensitive and detailed orientated. We send the goals through the SMART procedure to make sure that they are specific, measurable, achievable, realistic and time-specific. 

Duct Tape Marketing addresses the marketing vision in the book and further defines it in the Marketing Plan Pro software by using these three components:

· Goals: list the significant personal, business, strategic, and tactical goals of your marketing plan

· Marketing purpose: describe the greater purpose that the execution of your marketing plan and the growth of your business will fulfill.

· Marketing visual: write a paragraph describing a picture of this business as you would like a customer to experience it in a perfect world.

Another late end of the workday Back in April, I wrote a blog discussing the Marketing Vision, and as I implemented the Lean Marketing House, my thoughts about a vision statement started to evolve differently. I studied the Duct Tape Marketing Hourglass and used it as the Pillars in the Lean Marketing House. I segmented each Pillar based on the different customer channels that were required. However, I kept pondering because it still seemed to be missing a very important ingredient and even formulated the vision that each channel needed. The funny thing was that the answer was there all the time. It was obvious, very obvious.

The problem was that our vision statements are internally focused. Marketing is about the customer, it’s not about us. Your vision statement needs to be a definition of the NEED that you serve for the client. John Jantsch author of Duct Tape Marketing has always defined marketing as “Getting someone with a Need to know, like and trust you. That was further developed and expanded in the Marketing Hourglass to include the other steps of Try, Buy, Repeat and Refer. However, somewhere along the line the NEED disappeared.

The NEED is the vision and for each customer segment or Pillar if you are using the Lean Marketing House. Defying that need clearly takes quite a bit of effort, but I would certainly start by using  the Fishbone Diagram or the 5 Y’s to determine the actual need. It may even get a little more difficult in that and the use of Goldratt’s Logical Thinking Process could be used. However, the NEED must be defined and your ability to solve that NEED must become crystal clear in your Marketing NEED statement.

What NEED do you solve for the client? Put that at the head of the Fishbone and address the different causes. If your customer understands this message, and he should if you do it right(it is his NEED), your marketing may become extremely simplified. Even for the future, you will be thinking about how your customer’s NEED will be changing, and what they will NEED.

So would you rather go to market with a clear VISION or a clear NEED statement?  

Monday, October 19, 2009

Gathering Information For Your Plan


Affiliate Post By Palo Alto Software, Inc.

A common problem people encounter when writing their business plan is finding information about their business industry and competitive companies.Marketing Plan Pro Fortunately, in recent years the Internet has made information gathering simple and easy, but sometimes the best information is found much closer to home, with real people, in real time.

Always take a look at other businesses similar to your own, as a very good first step. If you're looking at starting a new business, you may well be starting one similar to one you already know. If you're doing a plan for an existing business, you are even more likely to know the business well. Even so, you can still learn a lot by looking at other similar businesses.

  • Look at existing, similar businesses

    If you are planning a retail shoe store, for example, spend some time looking at existing retail shoe store businesses. Park across the street and count the customers that go into the store. Note how long they stay inside, and how many come out with boxes that look like purchased shoes. You can probably even count how many pairs of shoes each customer buys. Browse the store and look at prices. Look at several stores, including the discount shoe stores and department store shoe departments.

  • Find a similar business in another place

    Find a similar business far enough away that you won't compete. For the shoe store example, you would identify shoe stores in similar towns in other states. Call the owner, explain your purpose truthfully, and ask about the business.

  • Scan local newspapers for people selling a similar business.

    Contact the broker and ask for as much information as possible. If you are thinking of creating a shoe store and you find one for sale, you should consider yourself a prospective buyer. Maybe buying the existing store is the best thing. Even if you don't buy, the information you gain will be very valuable. Why is the owner selling? Is there something wrong with the business? You can probably get detailed financial information.

  • Always shop the competition.

    If you're in the restaurant business, patronize your competition once a month, rotating through different restaurants. If you own a shoe store, shop your competition once a month, and visit different stores.

It takes a little hard work but by using the Internet and doing some research at local businesses, you should be able to gather all the information necessary for your business plan.

Wednesday, October 7, 2009

Have you taken the path of your customer?

One of my steps in working with a client is that I like to put together their Marketing calendar to understand what they have on the table, events, conferences, advertisement, flyers, etc. They usually have some type of marketing in place, and we are looking at improving the system not dismantling it. After the marketing calendar has been constructed, I start moving, sometimes  just the post-it-notes from a chronological order to a marketing flow stream based on the customers' viewpoint.  We could even call it an assessment, but in initially I am just on a fact finding mission, in Lean terms = Current State Map. The next step in the process is diagramming this current state map and in Duct Tape Marketing terms, their Marketing Hourglass.

However, this week the procedure took a strange turn. I completed the process but I happen to know one of the client’s customer very well. So, after constructing this hour glass with the new client, I was able to sit down with his customer and my friend and map the process from the customers' point of view. Voice of Customer seems to an over-used word in our Industry but this was one of my best experiences. We actually pulled the clients file from the customers file cabinet, reviewed the folders on his computer including e-mails and bookmarks. I then laid out all the marketing material that had accumulated, highlighted and even taking note of the bent corners in the catalog. This was all followed by an interview.

Of course, my sample size of 1 is not a good indicator. The key to this process was the awaking to the client and myself on what the customer valued and what his procedure was in making the decision. His process was simply different. We talk about going to Gemba and walking the walk from the customers' point of view, but do you? How much non-effective marketing could you save by doing this? How much effecting marketing could you implement?
 

Related Posts:

Is your Value Stream Mapping backwards?

Mirror Marketing E-Book

Another word for Marketing – How about Voice of the Customer?

Friday, October 2, 2009

Need an internet presence, but don’t have the time

First let's answer the question: What do you have to do?

Get Found Online: To run a successful online business, people need to be able to find your website. You must improve your visibility.
Improve Your Traffic: You must use customized SEO and Social Media tasks that help you boost the number of visitors to your site.
Make More Money: Improving traffic, rankings and brand visibility will generate more sales from your website.

I found a nifty tool that I have been using the past month called Lotus Jump. When I first started using it, I thought it was really nothing more than a spreadsheet telling me to do the things I do to get my website found. However, after using it for a month, I found that it put me places that I have not been before. It did give me additional insight into place that I should be and links that I should be creating. All I have to do is allocate 30 minutes of my time or someone else time that can post content to create a web presence. It is simply not enough to have a website anymore you need a web presence. Read this case study about a simple Flower shop or watch a demo!

This fits into a very nice into a Standard Work Practice for developing an Online Presence. Or, it can be used as a brick in the foundation of Lean Marketing House.

Thursday, October 1, 2009

The Ultimate Marketing System – The Forgotten Pillar

Readers of my blog have read my explanations of the Lean Marketing House and how your Marketing Channels determines your number of pillars and the size of each. You can suffice with just one pillar if it is big enough and strong enough to hold up the roof but the other day I realized that I had forgotten to describe what I will now call the Forgotten Pillar. Continuous Learning in the Lean Marketing House means theUltimate Marketing System. This is a term coined by Duct Tape Marketing and actually includes their workbook and CD's explaining their system. Most marketing plans and systems fail if adequate training is not provided. UMS

Lean Six Sigma Practitioners always realize that the training is what makes the processes work. Without, old habits stay the same and new habits are never developed. Nor are these new habits expanded to the greatest extent. It happens in marketing too. Marketing that works today is all about authenticity, customer touch points and the connection of those touch points. You have to be everywhere, but you also have to be you. Perfect marketing is less important because people really are seeking you. Even from an organization viewpoint, they are expecting a human and personal experience.

How do you go about creating this new wave of marketing in your organization? My advice is that you have to create a continuous learning cycle within your company. This is best done by starting out with a learning system, a structured program and a Marketing coach. This is self-serving to say the least, but it is what I truly believe.

I use the Duct Tape Marketing System as the learning system and the structured program to get someone started. I am not going to go through the entire program, you can do that here, but it will set you on the road to success and provide a foundation for you to build from. Without going through these necessary steps, you will never fully defined your marketing needs and just continue to respond to the marketing idea of the week. I cannot tell you how many phone calls I get weekly a call from an Ad Rep telling me about the next greatest deal. Please take note: It's not about the money, it's about the target!

Now, the coach is pretty important. I am not going to talk about that even Tiger Woods has a coach, you to keep you on track, hold you accountable and all that garbage. I am going to discuss about someone that has been there done that in the real world. I am also going to mention another cliché: Talk the talk and walk the walk. I can only talk for myself, but I will put myself up against any other coach in the sense that I walk my system. I believe in the Duct Tape Marketing philosophies. I practice them. If you think that is not true, just look at my Tag cloud on the left. Look at my Alexa score, Hubspot rating and Twitter feeds. They are better than the vast majority of corporations and certainly better than 99.5% of other coaches and consultants. Why is that? I simply follow the practices that John Jantsch of Duct Tape Marketing has taught me. Have I added a few tricks of my own? Certainly - Authenticity, Personalization, Differentiation and building your Core Message is what I have learned in my Continuous Learning cycle. What can you gain from that expereince? You will simply short-circuit your learning curve by having a coach on board!

Do you have Continuous Learning going on in your Marketing?