Strategic Insights 24
ENERGIZE YOUR CORPORATE CULTURE
FOR TOUGH TIMES
& It’s Potential Profit Improvement Effects?
Every social group – family, team, company, country – has a culture
often with divisive sub-cultures. “Culture” is simply: “what we believe in and
do around here". You can manage your culture with intention and strategic
design to great benefit. Or, it will (unconsciously?) manage your firm for poor
results; especially in fast-changing, tough times. To paraphrase Tolstoy: all happy
distributors are alike; each unhappy distributor (branch) is unhappy in its own
Although “culture” is an invisible force, it has been measured and
managed. Research proves that cultures that are strong, healthy, agile and
clearly defined significantly increase profits, growth and longevity. Great
cultures enable ordinary people to achieve extra-ordinary results. They in turn
are: engaged; turnover less; continually learning; recruiting most talented
friends; and promoting the firm evangelically. Most successful, publicized
companies are known for and by their intense cultures: Nucor, Southwest
Airlines, etc. By contrast, service-monopoly cultures like the IRS have strong,
but demoralizing, non-agile and unhealthy cultures.
If cultures can increase profits by 50-70%, why do some stars like Disney
and Zappos offer to educate anyone about their culture secrets? Perhaps they
believe, as I do, that:
Competitors won't be able to duplicate
their blend of excellent leadership, culture, strategy and execution.
The secrets aren’t really secrets.
Corporate pies could be expanded
for all if the students could find the courage to act.
And, the employees who teach the
culture courses to outsiders get even more enthusiastic about walking their
talk every day.
If achieving profitable changes is culture-dependent, then what’s a
culture overhaul cost? It requires no cash outlays, just enthusiastic, sweat-equity
from both leaders and associates in step-by-step, educational discussions. If
employees sense job-improvement hope, they become both eager students and
next-generation teachers for new arrivals.
Management is Most Critical for Distributors
Many big companies have competitive advantages beyond how engaged and
team-effective their employees may be. (Think: patents, natural resources,
politically-bought concessions, oligopolistic
regulations/prices). But, a distributor selling, non-exclusive commodities into
mature industries with saturated demand and excess supply can only win with a
service-value and cost-to-serve edge.
What then are some of the pre-requisites for achieving a service edge? :
Net-profit analytics to zero in on
the historically most net-profitable (core) niche(s). (YT: 101-112)
Re-define the service value
equation metrics for the target niche. (YT:113-127)
Identify within the niche: the big
winners to love and penetrate more; the big losers to fix; and the few key
target accounts to hyper-team focus on. (YT: 118, 134-142)
And, culture changes to fire up all associates to achieve
new service levels and to sell “service-value-chain solutions instead of
products for a price. (YT: entire section 5: 166-241)
You can subscribe to a net-profit-analytics, web-service, “total solution”
for peanuts and be diving into breakthrough, informational insights in a few
weeks to do pre-req’s 1-3 above.
But, how are you going to fire up your employees to change? What’s in it for
Surveys report that US workers’ present morale is at an all-time low
after the layoffs and comp cuts of the past few years. With the global economy
sinking on all fronts (at 7/20/12), what new, believable, low-hanging, profit-improvement
fruit will support gainsharing compensation increases and hope for all? What elements
of your culture will you re-align around your net-profit target: niches,
service metrics and key accounts? Are your -
mission, vision, values, strategy, strategic practices and supporting systems all
- articulated, target-niche consistent and thoroughly inculcated into every
employee? (YT: 239)
and How Do We Even Begin?
Don’t “dumbsize” your business (as many did in ’08) by cutting costs
across the board while trying to sell any and all products to any and all
customers whether they are net-profitable or not. Instead do a quick audit of your
“cultural beliefs”. Have the leadership team independently (and perhaps
anonymously) write down responses to the question in italics just above.
Compile the results. Convene and discuss the degree of: clarity, focus, agreement/overlap
and company-wide comprehension/motivation. What are the dysfunctional elephants
in your culture?
To live more deeply into the culture-element question above, watch and
critique the referenced youtube clips. And, certainly plan on attending the “Advanced
Profit Improvement Conference” in Phoenix on September 20-21. Meet with other
distributors who are already transforming their distribution businesses with
net-profit analytic insights and culture management. For more
information go to: www.apicconference.com. Or, feel free to contact me at firstname.lastname@example.org.