How to Develop Your Personal Brand (And Live Up to It)

What adjectives would you use to describe yourself? Would your coworkers, friends and families use the same terms?

Pamela Stepp, who teaches leadership assessment at Cornell’s ILR School, joined eCornell’s Chris Wofford for a WebCast focusing on how to develop a personal leadership brand and ensure that you continue to live up it.

Wofford: I’m very excited to have you here with us, Pamela.

Stepp: Thank you Chris, and thanks to everyone who is tuning in. This is all about you.

I want to start by asking everyone watching to think about who you are as a professional and who you want to be.

I’m going to walk you through the steps to create your own personal leadership brand and then help you come up with a story that you can tell that will demonstrate that brand.

Wofford: That sounds great. I think our audience will really get something out of this. Where should we start?

Stepp: Power is very important to consider when you are developing your personal leadership brand. You need to think about how you present yourself powerfully in an organization and how to recognize if someone is powerful or powerless. A good way to start thinking about this is to choose a person—this could be anybody in the world—who you think is powerful. Think about the characteristics of that person and what helps them be powerful and write down this person’s leadership brand in one sentence.

Chris, let’s use you for an example. Who did you think of?

Wofford: The first person that came to my mind was Bob Dylan. And the adjectives I used to describe him were mysterious, direct, and honest.

Stepp: Isn’t that amazing how fast you could come up with these clear traits? Let’s turn to the audience members. Someone has chosen Oprah Winfrey, saying she is credible, empathetic, driven, and relatable. Does that sound like Oprah? I certainly think so. Another has chosen Barack Obama and described him as gentle, straightforward, and clear-speaking. So we can see that it’s quite easy to identify the personal brands of well-known leaders.

Now let’s move on to thinking about our own personal branding. What makes you different? What adjectives would you choose to describe this brand called “you”?

Wofford: Wow, the answers from our viewers are coming in very quickly. Maureen says she’s organized. Darius, passionate. Marcelo, accountable. Rebeka says she’s driven and has great attention to detail. Carol says she leads and inspires.

Stepp: I can see more results are still coming in, but now I want you to come up with your most noteworthy traits and values. It’s important to remember that your values change at different stages in your life, so I want you to come up with examples of your current value, either personal or professional.

Wofford: Some of the answers coming in include curiosity, family, integrity, honesty, kindness, empathy. These are great examples from our audience.

Stepp: Yes they are. Now I’m going to give you an example of two short descriptions of the leadership brand that I use. I teach at universities and business schools all over the world and one of the brands that I use—and I want people to let me know if I’m living up to this —is that I want to be known for being a knowledgeable and inclusive leadership educator who demonstrates her passion for the subject and genuinely cares about helping her participants or students to grow into the best leaders that they can be.

So that’s the personal brand I have when I’m giving these sorts of talks. I had a different brand when I was a full time businesswoman as the managing director at the Center for Advanced Human Resource Studies. There, I wanted to be known for being a knowledgeable and open-minded business leader who used her confidence, determination, and networking ability to help the center grow into a more global organization.

So that’s how I’ve used my values to create personal branding.

Wofford: Pamela, I’m just going to play devil’s advocate for a moment and ask what the point is in using these words to describe yourself. In your case, you say you’re inclusive, knowledgeable, and dedicated to making sure that people get results out of your talks. Isn’t this just an example of putting your best foot forward? Does it really help one’s leadership ability to go through this sort of exercise?

Stepp: It does, and that’s because once you’ve established your leadership brand, you want to live up to it. It helps keep things clear in your mind and remind you whether or not you’re living up to the way you’ve described yourself and the way you want others to see you. Does that answer your question?

Wofford: It does. You’re saying we’re always a work in progress and that developing a personal brand helps bring focus to our careers and our professional lives.

Stepp: That’s right. It helps us focus on the traits that we want to be known for. Some examples coming in from the audience include inspirational, politically savvy, collaborative, innovative, results driven, strategic.

Then you start to refine those and work toward finding your identity by combining those descriptors. For example, “I’m a strategic innovator who gets things done.” You want to construct your leadership brand statement by putting everything together, all those adjectives and values.

Then you need to start asking other people what they think your brand is because it will surprise you. Make your brand identity real by checking in with others around you. Are you living up to that brand? That’s the beauty of having a defined leadership brand. You can always check in to make sure you are living up to it.

Wofford: So is your recommendation to go to other people and ask them how they’d describe you?

Stepp: Absolutely. You’ve got to keep reminding yourself of your brand and keep asking others if you’re living up to it. For example, I teach undergrads at the university because I want to prepare 20 year olds for leadership and because I want to know that generation. I started writing about being an inclusive leader and when I get evaluations back at the end of the semester, I can see that inclusion is my highest score. That really inspires me to keep working on that and to make sure everybody participates, to make sure I’m including international students who maybe aren’t speaking English all that well, making sure that there aren’t gender imbalances in who I reach. The point is, you can gain confidence if you learn that you are living up to your brand. And if you’re not living up to it, you have to know that. My brand is the yardstick by which I measure myself.

Wofford: We invite you to take a minute and see if you can come up with your own personal brand statement. Don’t overthink it. This is just an exercise and something that hopefully you’ll continue to work on.

OK, we have some responses. Deborah says “I’m a mentor. Helping others is what I enjoy best.” Steve has a great one: “I’m an innovator who pushes the creative envelope by inspiring others to do the same.” Crystal says, “I’m an innovative, compassionate, and knowledgeable leader with a desire to help others become the best that they can possibly be.” I think people are getting there, right Pamela?

Stepp: Yes, you are all doing a great job. These are good examples of leadership brand statements. You can refine and change them, but they shouldn’t be long diatribes. It should just be a paragraph, so these are really well done.

Once you have that brand, it’s time to think about storytelling. It’s always helpful to demonstrate your brand through stories, whether you’re standing up in front of an audience or if you’re at a cocktail party or even just with your friends. When done well, a compelling story can inspire our beliefs and our motivation to reach a goal. So I recommend that you all think of a story that you enjoy telling and think about how you can use that in the workplace.

I also want you to think about nonverbal power. When you walk into a room, you want to stand up straight and have good eye contact.With nonverbal power, you want to express competence. You want to express trustworthiness, dynamism, energy. When you talk, you want to be sure to think about using a proper voice, making eye contact and scanning the whole room.

Another huge thing is that when you are speaking with someone, you need to take the effort to learn their name, maintain eye contact, and make them feel you are focused on them. I’ve always found that amongst the people that I admire, their leadership ability is to make you feel like you’re the only person in the room.

Wofford: Pamela, thanks so much for joining us. I’m excited to get my storytelling ability dialed in and I hope that those in the audience will start working on their personal leadership brand one-sentence mantras as well.

Stepp: Thanks so much for having me.

 

Want to hear more? This interview is based on Pamela Stepp’s live eCornell WebSeries event, How to Develop a Personal Leadership Brand. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

How to Successfully Pivot Your Startup

The fundraising and engagement platform GiveGab made waves in January 2018 by purchasing one of its biggest national competitors. With the acquisition of Kimbia, GiveGab is one step closer to becoming the biggest charitable software program out there.

But that success would not have happened if the company hadn’t decided to completely change direction from its original vision of being a social network connecting volunteers and nonprofits. In 2015, GiveGab pivoted to focusing on helping nonprofits attract and maintain donors rather than volunteers.

The company’s CEO and co-founder, Charlie Mulligan, spoke with eCornell’s Chris Wofford about his “painful” yet highly successful pivot decision and to share tips on how to decide when it’s the right time to change strategic direction. What follows is an abridged version of Mulligan’s presentation, delivered as part of eCornell’s Entrepreneurship webinar series.

Mulligan: I’ve met thousands of entrepreneurs at this point. I think almost all of them would describe themselves as having a vision of what they want to happen and being very persistent. While I agree that these are really important traits, they can also impact the challenges of pivoting. If you really pride yourself on what you are doing, it can be very hard to have to admit that your vision was wrong. When reality hits, it’s sometimes like you suddenly realize you’re climbing the wrong mountain. It’s not a matter of changing little tactics. You have to change your entire strategy. That’s what a pivot is to me.

When you are starting out, there is really no way to predict the future. Yeah, some people get lucky but for a lot of startups you’ll find that the reality is different than what you envisioned so you’ll have to decide what to do. You can quit or you can be flexible and make a different choice.

Wofford: How do you know when it’s the right time to change direction?

Mulligan: It could come at any stage. When you’re starting out, you have this idea of what the customer wants. Well, you better talk to as many customers as you can and you need to realize that oftentimes you will hear what you want to hear so you have to be very careful and make sure that you start to listen before you get too far down the road. You might have to pivot very early once you’ve assessed the demand and done the research.

The key thing about a startup is a lot of times you’re trying to create something new or completely different, but when you’re doing research, the research is about old products or old ways of thinking. So you won’t really know for sure whether your new way is going to be right.

Wofford I’m sure the audience would love to hear the details of your decision to switch tactics at GiveGab.

Mulligan GiveGab set out to be the social network for volunteers, which meant that we were a connection portal to help volunteers and nonprofits find each other. We interacted with a lot of nonprofits and they were really happy to talk about this. They loved the idea and then as we built our product they thought it was great. We had a free product so we had thousands of nonprofits and hundreds of universities sign on. We passed 100,000, things were growing and moving fast and we were getting great press and great feedback.

But it didn’t take us long to realize that there was really low engagement. Nonprofits would sign up but then only come back like every six months to do something. It was really challenging to get them to actually post volunteer opportunities.

When I first started I thought it was going to be really easy to get nonprofits to post volunteer opportunities because they were consistently telling us that they need more volunteers. But we couldn’t get nonprofits to actually sign in and create volunteer opportunities. That meant that we were having a hard time matching the volunteers who had signed up with opportunities in their area. You know, a volunteer in Montana and a nonprofit in Minnesota don’t really match up.

That’s why we decided to go after universities to help build an ecosystem because a lot of times they have volunteers and nonprofit partnerships. The problem we found there was that it was a super long sale because we were talking to low level employees. We should’ve noticed this problem earlier but if you want to know what a nonprofit really cares about, you need to go see what the executive directors are doing. What the directors are doing is looking for donors, not volunteers.

Raising money is really what mattered the most and we weren’t listening to that. So we decided to go down a new path. We sat down and really looked at what the nonprofits were using their volunteers for. Almost always, the volunteers were being used as a direct or indirect way to get donors. It’s really about money for nonprofits and volunteers are a way to get donors more engaged. One of the things we kept hearing all of the time – and the research backs this up – is that only 19 percent of first-time donors ever come back. Nonprofits spend all of this time getting donors and then four out of five of them are gone and never come back. We were skirting around the edges with volunteering but the core problem was how to get more donors and keep them coming back. So that’s now the problem that we decided to solve.

Wofford How big was your organization when you decided to make this pivot?

Mulligan We had 90 employees and we had a lot of funding. We had dozens of investors and so I had to go back to all of them and admit I was wrong. Then we had to let about half our company go. These were really good employees so that was a very painful day.

For a lot of people, ‘pivot’ is just a word, just a strategic choice. For me, it’s a painful memory. It was necessary and I’m really glad we did it, but it was painful.

We had to totally re-brand. We were the social network for volunteers so we were highlighting happy volunteers and like things like that, which makes no sense for a fundraising platform. So conceptually we had to change everything. Then we had to build it and go back to our development team and say, “Ok, we’re starting from scratch, let’s learn how to do this.”

There are also laws around fundraising so there was a lot of work in just making sure we were doing things the right way.

Wofford That sounds really challenging.

Mulligan It was, but one of the great things about pivoting is that if you’ve built a great team, as we had, then you’ve already figured out how to work well together. In our case, the employees we were left with were great, so we got a second shot at something and the second product looked a million times better than the first product because we really knew what we were doing by that point and we had a system in place.

There’s also a certain amount of incentive in a pivot situation because maybe you’ve run out of money, so you know that this could be your last lifeline. So you better make progress and you better make it quick. There is nothing like the gallows to give people focus.

As an entrepreneur, it can be very challenging because you have told a lot of people about your vision and you’ve been very persistent and then you have to go and tell them, “OK my vision sucks but now I have a new one.” You’re asking people to buy into this new idea even though your first was wrong.

Wofford That must take a certain humility.

Mulligan Sure, and you also have to make some super painful choices. Like I said, we had to let employees go. We had to go back and talk to investors and let them know that all of their investments just went backwards. Nothing about it is fun but you have to just face it head on, so I just owned it. I think that approach was super helpful.

You have to pick your new course of action and then you have to forget the past. Pick your new vision and just sell that like that was the only one you ever believed in. And of course you’ve got to somehow get everyone to buy into this one as much as they we’re into the first one. These are all way harder things than I think people realize.

Wofford It certainly sounds hard. Was it a challenge to keep morale up?

Mulligan Well, when you’ve just let half your workforce go, keeping morale up was already a challenge. People’s workloads had doubled and then it was like, “Now let’s do it over.” I think what helped us is that we spent a lot of time making sure that our new course of action was picked by everyone, not just me.

Wofford Everyone needs to be on board to make a pivot work.

Mulligan Right. We had conversations with the people that we were going to keep and said, “Look, if your heart’s not 100 percent in this, you need to let us know because there are people we are letting go whose hearts are 100 percent in this.” That wasn’t a threat, it was just the reality. I think people really appreciated the openness and transparency. When we let people go, we really supported them but we also sat everyone down and said, “OK guys, we’ve got to forget about it. There is a lot of pain here, but we need to just move forward.”

When we did our pivot in January 2015, we had five nonprofits raising money on GiveGab.
At the end of the year, we had 700. All paying customers, so we were making money off all of them. We are currently on pace to potentially have well over 20,000 nonprofits by this year. We also have 10 states using us as their statewide giving day platform later this year. So the pivot worked.

Wofford Wow, it’s very impressive. Congratulations.

Mulligan We’re really excited and of course relieved. We saw the bottom and that makes you appreciate it more when things are really working.

So much of the startup ethos is ‘vision and persistence’. I think you need vision and flexibility. You can also think about it in terms of the difference between persistence and resilience. Persistence is putting your head down and running into the wall. Resilience is putting your head down but looking around a little and realizing there’s a door over there and you can walk right through it.

Wofford Charlie, thank you so much for sharing your experience and giving such great advice about changing strategic direction.

Mulligan Thank you, Chris. I enjoyed being with you.

Want to hear more? This interview is based on Charlie Mulligan’s live eCornell WebSeries event,The Startup Pivot: Changing Strategic Direction. Subscribe now to gain access to a recording of this event and other Entrepreneurship topics.

Are Most Managers Bad Listeners?

The Art of Listening for Impactful Leadership

When you think of the traits that define a good leader, does your list include listening? If it doesn’t, it should. If you learn to develop and improve your ability to listen, you’ll likely be better prepared to lead and manage individuals, teams and organizations.

In this edition of the Women in Leadership WebSeries, Professor Judi Brownell from Cornell University’s Hotel School joined eCornell’s Chris Wofford to discuss how listening can improve your effectiveness as a manager and to share practical tools for improving your leadership ability through listening.

What follows is an abridged version of their conversation.

Wofford: Is it true that most managers are bad listeners?

Brownell: Well, most managers certainly believe they listen more effectively than they do. I think that speaks to our lack of awareness of listening.

Listening is like any other communication skill in that you really can keep improving. Regardless of how well you actually do listen, there is always more you can do.

In a professional context, there is a really interesting curve where listening is critical as you come into an organization but then speaking is often more important in the middle of a career because you’re influencing through your ideas. And then as you go into senior management, listening once again becomes really important.

For new employees, listening is particularly important because it’s through listening that you begin to understand how things are done in an organization and whose voices are really heard. But it’s also important in senior positions. One of the problems is that sometimes senior executives think they have all the answers but they often don’t. They really need to rely on other people’s perspectives.

Wofford: Listening is easily taken for granted, right?

Brownell: Absolutely. A lot of us don’t think actively about how we listen.

Listening is what we call a receiver-defined activity, which means that things mean what the listener thinks they mean. We’ve seen that in many cases in the political arena recently. No matter where you stand, things can mean different things to different people. That’s because as a listener, you have a lot of personal characteristics that contribute to how you interpret things.

Wofford: Speaking of personal characteristics, let’s check in with the audience. As Judi mentioned, most people think they’re better listeners than they actually turn out to be based on feedback. So I’m going to ask the audience: How would you rate yourself as a listener? Do you perceive yourself as an excellent listener, a pretty good listener, an okay listener or a pretty poor listener?

Looks like almost 75 percent say they are either excellent or pretty good, although we do have two admitting to being poor listeners. This probably jibes perfectly with your data, right?

Brownell: Yes, generally people think that they’re pretty good listeners.

Wofford: I’d now like to ask the audience to think of someone you work with who is a great listener. What is it that they do? Give us the one particular characteristic or a bit of feedback they display that demonstrates to you that this person really listens.

Brownell: The responses coming in are what I would expect. People list “eye contact,” “nodding,” “asking follow-up questions,” “focusing,” and “reciprocating.” These are all great and I think asking follow-up questions is probably one of my favorite things about having a conversation with somebody. That’s an indicator that they’re listening. I’m not satisfied when I’m talking to someone and they’ve got nothing but answers.

Wofford: Okay Judi, so what else can people do to develop their listening skills?

Brownell: I want to talk about the LAW of listening, which is Listening = Ability + Willingness. Although listening is a skill that you can develop, nothing really matters if you don’t have a willingness to listen or if you don’t have an interest in focusing on your listening and making it a priority.

I think it’s important that everybody see themselves as someone who can improve their listening, no matter how great or dismal you think you are at listening.

We certainly learn by listening and we facilitate by listening. As a leader you’re not the one who has all the ideas or all the opinions, you’re the one who brings out the best in the team. So a good listener makes sure that all of the people in the group feel like they’re heard.

Listening also builds trust. If you are someone who listens and encourages others to listen, trust increases. When trust increases, so does job satisfaction.

Wofford: And the flip side is that poor listening then leads to lower job satisfaction, right?

Brownell: Yes. Let’s talk about what it means for you as a leader when you are not listening.

I was asked to do a listening training session at a large healthcare organization where the employees were unhappy with the way their managers listened. When I went in to try to find out a little more about the problem I discovered that different employees meant different things by not listening. In some cases they would mean that a manager would say, “Sure, don’t worry, I’ll take care of it” but then didn’t follow through. To them, it was like not listening. In other cases a manager would have an open door policy but when someone would come in to speak to him, he’d be multitasking and doing a lot of other things. So the employees were frustrated with their managers but for quite different reasons.

Over the course of five to ten years of doing a lot of needs analysis and a lot of interviewing and a lot of follow up, we came up with a model that has six interrelated components that represent the different types of skills that contribute to what people think of as effective listening.

I’ll go through each of those from the standpoint of a leader. The first of these is focusing attention. Are you paying attention to the right things? Next is understanding, which is getting more complicated as we have a more diverse workforce and customer base. Then we have memory. If you don’t remember, it affects the way that your listening is perceived. Fourth, interpreting. This has to do with the nonverbal aspects of listening, while the fifth component, evaluating, has to do with making a judgment about something. Finally, the last component we’ll discuss is responding.

So you can see with all of these components that listening is a process. It involves a multitude of different skills and you may be really good in one skill area but not so good in another area.

Wofford: How do you improve in the areas that need it?

Brownell: We have what is called listening strategy, which is a way to focus your attention. There are two components of listening strategy. One is the context. Usually in leadership situations, you’re in a team context. But even if you’re not the leader of the team, you can still have a lot of real influence as a team member by changing your listening behavior. Many times what a team needs is someone who’s really listening and paying attention.

Wofford: What are some of the different contexts that listening can play out in?

Brownell: It could be whether or not you’re listening one on one if you’re in the context of two people. Or listening within the context of the team or within the context of a presentation, where you’re just sitting there listening to somebody speak. Or the context of a mediated communication, which is the type of ‘listening’ that takes place while communicating through texting, email or the telephone. I expanded listening to include texting and all of the ways in which people today, particularly younger people, are communicating because there’s always a listening component to those interactions.

Part of context is how many people are involved. A team situation is the most dynamic because you’ve got all these players. The other element of context is the purpose. You may not always think about it, but whenever you go to talk with someone, there’s almost always some purpose. It can be to learn, to make a decision, to solve a problem or just to get to know someone better. So looking at the context, both in terms of the number of people and the purpose, helps you focus your attention on the things that are important.

We all know about selective attention, which means that you tend to seek out things that confirm your beliefs. But being open minded is so important in listening. You need to at least attempt to understand what the other person is saying, even if you don’t agree with it. It’s fine not to agree, but you need to listen until you understand.

Wofford: When your disagree with someone, do your own beliefs interfere with your ability to really listen?

Brownell: Well, there are a lot of personal factors that influence what you hear. As I mentioned earlier, individual differences and diversity are major factors in our ability to really understand all messages. When I’m listening, I try not to make assumptions. I try to really ask probing questions, questions that show that I’m interested.

Everyone is so different now, with different understandings of things and different amounts of information about things, so you should never just assume what someone may or may not know. Along with that, you should never take for granted that someone is listening to you. You need to look for the visual cues and ask questions. Sometimes when you are listening to someone, asking them if they feel that they’ve been heard is really powerful. To ask, “Do you feel I’ve understood you, and if you don’t, then please tell me more so that I do understand” is pretty effective.

Wofford: That’s a great tip. Do you have any others to help people focus and understand?

Brownell: Well, as you know, a lot of people have trouble with remembering names when they are introduced to someone. It’s typically because they’re not really focusing on listening to the name — instead, they’re focusing on what they plan to say next. So some of that difficulty in remembering is just due to where you’re focusing your attention.

Wofford: I think using people’s names in conversation is a great way to indicate that you’re paying attention.

Brownell: Absolutely, that’s a great tool. When meeting someone, you need to give a firm handshake, have really direct eye contact and then repeat their name: “It’s good to meet you, So-and-So.” That definitely helps you remember their name, and remembering is part of the perception of listening. If you don’t remember, you are perceived as having not listened.

Also, and I think most people are already aware of this, it is very important to be sensitive to the non-verbal elements that either contradict or support what someone says verbally. The non-verbal carries something like 70 percent of the message so you need to try to understand not just the content in the language but also the emotional aspects that are communicated through body language, expressions and vocal characteristics.

Wofford: We had an observation come in from the audience that I find really interesting. This person writes: “When you are known as active listener, especially when you listen with emotional intelligence and show that you actually relate to the speaker, they always try to burden you with personal issues.” Judi, what do you think of that?

Brownell: I think it’s true that sometimes when you’re perceived as someone who will listen, people may take advantage of you. If you are a good listener, you may attract people who are needy and that is a really difficult balance. You need to find a way to get yourself out of those situations. As soon as you realize what is going on, you need to continue to have empathy and project empathy but then you need to say, “I really wish I had more time for this, but I don’t.” If it’s somebody you really care about then you can set up another, more appropriate time to discuss it.

Being a good listener doesn’t mean that you can’t be assertive. Assertive skills can go in combination with listening skills. You need to protect your time because your time is really valuable.

Wofford: I think most of us can relate to being in a situation where someone really wants you to listen to them but for whatever reason you just can’t do it right then. It can be very awkward, so I think that was a great comment from the audience.

There’s another question that I’d like you to weigh in on because I think it’s another situation a lot of people can relate to. Katherine asks: “What if a senior executive you work with does not exhibit healthy listening behaviors? That is, he or she interrupts, doesn’t give feedback, doesn’t probe. How do you handle that?” I suppose there’s no short answer to that one, but do you want to respond?

Brownell: Can you help a leader become a better listener? Well, changing someone else’s behavior is really hard. One of the things I’ve always found is helpful in trying to get someone to really listen to you is to connect with them. Treat them as a real person and not just the person in their role. Learn about their interests. I find that helps them get into listening mode a little bit. Timing is also important. If you approach some people at a bad time, they’re not going to listen regardless. So you can try to strategically select what might be a good time.

Also, maybe the reason they’re not listening is that they have something they want to say. People don’t listen if they also want to speak. If you go to your supervisor and there were things your supervisor wanted to tell you, he or she won’t listen to you until they’ve had the opportunity to tell you what they had in mind for the meeting. After they get something off their chest, they’re much better positioned to listen.

Wofford: Judi, I want to thank you for joining us today.

Brownell: Thank you, Chris. We really had some great feedback from an active audience so I think we’ve got a pretty healthy bunch of listeners out there.

 

Want to hear more? This interview is based on Judi Brownell’s live eCornell WebSeries event, The Art of Listening for Impactful Leadership. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

Do You Know What Your Customers Really Want?

Learn from Cornell Hotel Experts how to determine what customers really want and how to deliver it to them in ways that build trust and exceeds expectations.

Here’s What Most Companies Get Wrong About Service

As we enter an age of experiential service, customers not only want more out of their interactions with companies, they also enter into those interactions armed with more knowledge – and thus greater expectations – than ever before. But in order for service professionals to exceed their customers’ expectations, they must first know what those expectations are.

As part of the Hospitality webcast series hosted by eCornell, Elizabeth Martyn of Cornell Hotel School delivered a presentation on how to determine what customers really want and how to deliver it to them in a way that builds trust and exceeds expectations.

Below is an abridged version of her conversation with eCornell’s Chris Wofford.

Wofford: What do organizations most often miss when it comes to exceeding customer expectations?

Martyn: In order to exceed expectations, you have to understand what your guests’ expectations are to begin with. That might sound kind of obvious but I think a lot of times we get so focused on going above and beyond that we sort of miss some of the key steps in making sure that we know what it is that customers are expecting when they come to us for service in the first place.

Meeting all of those expectations has to come before we take the next step and talk about exceeding them. You’ve got to hit the basics first and it’s easy to look right past that.

Wofford: Does it start with trust?

Martyn: That’s one of the things that I get really passionate about because a lot of times we end up spending our time focused on the standards we need to hit when there really needs to be a focus on what’s going to work for you to build a trusting relationship. How do we tailor our service to our clients in order to build a trusting relationship and create loyalty?

Wofford: I have to imagine it’s about the whole brand experience these days.

Martyn: That’s right. We have really left the age of customer service and are moving into the age of experiential service. We talk a lot about millennials now, and millennials want experiences. But it’s actually something that’s true across all demographics of consumers. They’re looking for a more authentic experience, a more authentic connection.

So we need to think about the holistic service experience that we’re providing. The service experience is the entire experience that your brand or organization provides to your customer. We need to think about it from a broad perspective.

Wofford: And there are many more touch points available now due to technology.

Martyn: Yes — that’s part of what this “age of experiential service” means. You have all of these different interactions going on. The guest goes to your website, they check out your social media, they look at your reviews on Yelp, TripAdvisor and Google. There’s e-mail communication, maybe some company support text communication. They’re calling on the phone. They may be engaging with the automated bot-oriented service providers that we’re seeing more and more, where customers can engage with a scripted bot online. And they’re also still interacting with your personnel face to face.

Customers have this whole digital perception of what your company is and they create expectations before they ever pick up a phone and call you or walk into your place of business. So we have a lot more to think about when we think about the service experience because it’s so broad.

Wofford: And this is changing quickly, right?

Martyn: It is. By 2020, the customer experience is going to be more important than both price or actual product differences in terms of differentiating brands. A recent study found that 56 percent of consumers have higher expectations for service than they did just one year ago, and that’s part of this flood of information that they have about who you are and what services they can expect. We can also see that 68 percent of consumers are switching brands because their expectations aren’t being met. They have other options and they’re much more informed so they can choose to take their business elsewhere.

The study also shows that 74 percent of consumers have actually spent more money because of the quality of service that they received. Think about that. With three quarters of the people you’re interacting with, you have the ability to drive their engagement and increase what they spend on your company if you provide that trusted service and exceed the expectations level.

Wofford: And that 68 percent figure shows that you can steal business away from your competitors if they’re not doing it right.

Martyn: Exactly. The stakes are really high and there’s a lot of pressure on the face to face, phone-based and email-based interactions that service providers actually have control over.

One of the things that we need to do as we look to elevate the services that we’re providing is to take a close look at how we’re currently doing things today. Often times, companies find themselves falling back on a standards-based approach that tends to focus on the customer’s stated need. But this is difficult because a lot of times our customers don’t actually necessarily know what they want. Or they know what they want, but they don’t know the right question to ask to get the answer that they want.

Let me give you an example. Let’s say you’re traveling somewhere and you go into a hotel and you say, “Hey, where’s the best place to eat around here?”

The person at the front desk says, “Ah! The best restaurant in the area is Cafe ABCD. You have to go there, it’s terrific.” So, off you go. You walk three blocks to the cafe and, surprise, it’s closed. That’s because it’s lunchtime and they only serve dinner.

So that front desk worker actually did answer the question correctly. Cafe ABCD truly is the best restaurant in the area. But they didn’t take that extra step to ask about your real need. To ask you if you were looking to eat now or later, or if you wanted the best place to entertain a client or if you were just looking for something quick. They didn’t ask how much money you wanted to spend. There are all of these components involved in really delivering the right service at the right time to the right person.

This is the kind of scenario that tends to unfold in a service environment with a standards-based approach. Now, if we look at an excellence approach to delivering service, you’re really focusing on teaching techniques and strategies that allow your team members to think critically, to be fast on their feet and be able to adapt on the fly during that service exchange. In this approach, you’re tailoring your responses and your delivery to each individual based on all those clues that you’re picking up.

Doing this effectively helps to develop amazing relationships because when the customers feels like the person they’re talking to is really taking the time to figure out what they need, they think, “Wow, these people are great. They get me. I love coming here.” And that’s where we move into totally exceeded expectations.

Wofford: And those are the customers that are likely to come back to you time after time.

Martyn: Absolutely. You know, when we start to get into the difference of standards for excellence, it can be hard to explain, even to our fellow colleagues. What are we really talking about here? If you’re thinking about standards as being what your customers expect, how do you then deliver on those expectations? How do you meet or exceed them?

The next step in moving to the service excellence approach is to really recognize the client. Who is our customer, and how can we adjust our service delivery to make them feel important, relevant, heard, respected, or whatever it is that’s critical to your audience? What makes them want to come back and give you their business? The service excellence approach is adjusting your service to meet these standards and expectations.

A lot of companies will dictate a service delivery. You have to smile, you have to make eye contact and have a friendly and engaging attitude. The customer’s always right, and so on. These are not bad ideas but they’re limited because they’re not allowing the individual service provider to really do critical thinking and be able to take ownership of their service and deliver the best service as opposed to just being friendly and engaging.

Wofford: When you talk about the concept of critical thinking, it sounds like something that’s maybe difficult to teach and certainly something that would make it more difficult to get everyone on the same page. What does critical thinking look like in practice?

Martyn: Critical thinking would be taking an active role as a service provider in the moment and making decisions based on the information that you’re processing. That’s the real difference. Sometimes, when we’re in a more standards-based approach, we just follow the script. When we see something that deviates, we might notice it but not act on it.

In an excellence approach, if you see it, you want to do something about it. The important thing is to use that information and adjust or modify your approach because of the new information that’s coming in.

Wofford: What other approaches can help your service delivery, particularly for those who are out there on the front lines interacting with clients, guests or customers every day?

Martyn: Another great technique is to listen, observe and ask. That’s a terrific way to manage the actual exchange portion with each guest. Be open to what they’re saying, truly hear and confirm that you received the message correctly. Watch for changes in body language or facial expression and then decide, “Okay, was that a positive change or a negative change?” Then use that to reconfirm and ask thorough questions. “Does this work for you? Is there anything else I can do? We have a choice of A or B, which would you prefer?”

Make sure that you’re really open to information. Then seek out validation. Am I doing the right service for this guest?

The final piece is to be sensitive to context and use that to inform your delivery. The right service to the right guest is really dependent on the clues that you’re receiving. I think a lot of us are comfortable with the idea of using guest clues like facial expression and body language, but there are a lot of what we call environmental clues too. It can be whether they are wearing a coat or not. Do they have a wet umbrella? What kind of bags do they have with them? What else can you look at and use in order to customize that service delivery?

This is probably something that we’re all already doing automatically from time to time, but it’s about using it with every guest very intentionally to step up your service level beyond just those most obvious instances.

Wofford: It’s more than just seeing someone come in soaking wet and saying something painfully obvious like, “Oh my, you got caught in the rain.”

Martyn: Right, it’s about picking up on clues that aren’t so blatant and acting on them.

Good customer service isn’t rocket science, and I don’t want to tell anyone that it is. But that’s the thing. Some people are just innately good at it but they can’t necessarily explain why. You almost feel like they either have good customer service in their DNA or they don’t, but I think there are a lot of people who don’t necessarily realize that they’re not doing the right thing even though they’re really well intentioned.

As I said at the outset, you cannot possibly exceed expectations if you’re unclear on what the expectations are. It’s important for leaders to distill service down to a framework that puts some structure around the things that really great service providers are already doing. Creating critical thinking standards for the people on the front lines can be really successful. It helps them deliver good service to your clients and also gives them the confidence in knowing how to perform their job.

Wofford: It sort of eliminates the gray area.

Martyn: That’s right. My challenge for everyone here is to think about what they are going to do today and tomorrow. What are the next steps? This is not big picture stuff that should take six months or a year to put in place.

There are absolutely things that everyone can go out and do today and decide to put a stake in the ground and say, “I’m going to make a change. I’m going to try something different tomorrow or on my next phone call and see what sort of results I get from being a little bit more engaged, and thinking about both the before and the after, the prep and the follow-on of that service exchange.”

Wofford: Thank you, Elizabeth, for joining me in the studio. You’ve really given us some great advice here today.

Martyn: Thank you, Chris.

Elizabeth Martyn is the author of Cornell University’s Service Excellence On-Demand Training, an eight-lesson online program focused on actionable frameworks for delivering what customers need, when they need it.

 

Want to hear more? This interview is based on Elizabeth Martyn’s live eCornell WebSeries event, Building Trust and Exceeding Expectations: Service Excellence at CornellSubscribe now to gain access to a recording of this event and other Hospitality topics. 

Ten Tips to Power Up Your Presence

Learn ten tips for how to power up your personal presence in the workplace and increase your awareness of the image you project.

Are you projecting your best self at work?

As anyone with even a rudimentary understanding of communication knows, our spoken words are only a small part of the messages we convey. From posture to eye contact and even what we wear, our nonverbal signals often carry more weight than what we say.

Angela Noble-Grange, a senior lecturer of management communication at Cornell’s SC Johnson College of Business, recently joined eCornell’s Chris Wofford to share ten tips for how to power up your personal presence in the workplace and increase your awareness of the image you project. Below is an abridged version of her conversation.

#10 – STRAIGHTEN UP

How do you look when you’re in a meeting, or even if you’re sitting in an office cubicle? How do you look if you’re at a cocktail hour with your coworkers? Are you a sloucher or are you someone who sits up and looks like you’re ready to participate and engage with the people around you?

If you’re kind of slouching when you come into a meeting or you look like you need coffee or didn’t get enough sleep, you’re really signaling to people that you’re not ready to participate or engage. You want to look ready. People form their impressions of you based on how you present yourself.

If you’re in a cubicle, you might think, “Well, this is my office space, why should I have to change the way that I behave?” That’s obviously your call but if others can see you, you should at least know that you might be sending a signal to your coworkers that you’re just not as engaged.

It’s funny; when I mention standing straight or sitting straight in my class, you’ll see a lot of slouchers in the room immediately straighten up.

#9 – SPEAK UP

Are you one of those people who hears a lot of conversation going on in meetings but tends to not participate? Often times, you might talk yourself out of participating by thinking your idea is too out of the box, or that your question isn’t smart enough?

If you’re that person who doesn’t speak up, the simple remedy is to give yourself a goal. Maybe you can decide that once a week, or once a day, you’re going to make sure that your contribution is heard. Commit to speaking up during a meeting, even if it’s just to say that you agree with another person or that you want to build off of something that someone just said. Even if you don’t have something important to say, just expressing curiosity about someone else’s viewpoint will help. That may seem a little bit less threatening than coming up with something completely on the fly.

Remember, if you don’t say anything, someone else may say the same thing you were thinking, and you’ll really be kicking yourself.

#8 DON’T INTERRUPT ME

Is the culture at your company such that people interrupt each other all the time? But you were someone who was taught that it’s not polite to interrupt, so you need a way to get the floor back?

If this happens to you, I have a couple of phrases you might want to try. Of course, remember to say these things with a smile because a little charm can go a long way.

You might say, “I only need one more minute to finish”, with a nice smile directed at the person who interrupted you. Then take your moment, and maybe even gesture with your finger so they realize that you’re serious. The same phrase delivered with a different tone, with no smile and no gesture, might be perceived as a bit aggressive and you risk being labeled with the B-word, which often happens to those of us who are female.

The other phrase you might want to try is something like, “Oh, I love your enthusiasm for the topic. I just need a minute more and I’d be happy to hand the floor over to you.” Again, it’s not just the phrase. It’s the phrase combined with the right tone and a smile, and making sure that you are looking at the person who just interrupted you.

#7 CLAIM CREDIT WHERE IT’S DUE

Let’s say someone takes credit for an idea that you just expressed a few minutes ago. How do you make sure that people know it was actually your idea? Sometimes you might just want to let it go but other times, particularly if this is happening often and it’s hurting you at work, you need a way to show that you are the one who had the idea.

Something like, “Oh, that’s the idea I just expressed a couple of moments ago,” or “I’m so glad to see that we are in agreement” often works. These phrases are non-confrontational but make the point. Another one is, “Thank you so much for reinforcing the point that I just made a moment ago.”

#6 SPEAK AUTHORITATIVELY

Are you someone who uses the words or phrases like “just, only, hopefully, I think, I believe” when you’re making statements? Do you say “I’m sorry” for things you really don’t need to be sorry about? Do you constantly seek validation from people?

When you use diminutive phrases before everything that you state, it takes away the value, the quality and the power behind what you’re trying to say.

For example, sometimes I’ll hear a student say, “I’m only a first year. I’m only a student. I’m just beginning to learn finance,” instead of, “I’m learning finance. I am a student.” or “I am a member of this team.” It can also be as simple as saying, “This is a great strategy” rather than, “This is a great strategy, right?”

Why does it matter? Deleting those diminutive phrases is all it takes to add a little more power to the statement that you’re making and increase your presence overall.

#5 VERBAL AIR POLLUTION

It might sound weird but this is one of my pet peeves. What I’m talking about when I say “verbal air pollution” is the use of little words like “um.” That’s the worst one. But there are others –“like” and “you know” are two good examples. Basically it’s anything you’re saying that doesn’t mean anything. It’s those things we say when we’re trying to buy ourselves some time to think.

Usually, people are not comfortable with giving themselves time to think. They feel like they have to fill every single moment in a conversation with words. You don’t have to. Try to think about this one from the standpoint of the audience member. They’re trying not only to listen to you but also make sense out of what you’re saying. If you’re constantly rushing and filling every moment with speech, you’re making it harder on them.

Get comfortable with silence. Kill the “ums.” If you use them, ask one of your coworkers to catch you every single time. Make an agreement in which you will pay them a quarter or a dollar, depending on what you’re willing to part with, each time they catch you spewing verbal air pollution.

#4 THE HEAD NOD

You may have seen the person in a meeting who is just constantly nodding their head. Maybe you are that person. But this can cause mixed signals. For women, a head nod often means, “I’m encouraging you. I support you.” For men, a head nod often means, “I agree with you.”

So, can you imagine being in a room with mostly men, which is typically the type of room that I’m in, and you’re nodding your head and the whole time they’re thinking, “Wow, she agrees with everything that I say, isn’t that wonderful?” But really, all your trying to do is signal your support, not necessarily your agreement.

Now of course I’m not suggesting that each company should create a culture where we say, “Hey everybody, nodding your head signals encouragement, not agreement.” Nor am I suggesting that we should stop nodding our heads all together. What I’m saying is that this is something you might want to be aware of. Are you an excessive head nodder? Are you signalling to others that you agree with everything they say?

Because when you do that, strangely enough, you get people thinking that maybe you’re not all that powerful because you simply agree with everything. You just want to pay attention to it, to make sure it isn’t actually getting in the way of what you’re trying to get done.

#3 DRESS UP

That is, dress up a couple of levels beyond where you are in your company right now. As you’re interacting with your coworkers every day and you’re dressing just to the level of your coworkers, your boss, and your boss’s boss, will only see you at that level. But if you dress a couple of levels up, you’ll make it easier for the people who work at those higher levels to imagine you in that role.

You need to be mindful of how you dress because, somewhat unfortunately, we form impressions of one another based on how we show up at work. Of course, not every work environment has to be formal. It may be that you’re in a super casual environment. If you show up in a really nice dress suit at a tech job in Silicon Valley, they’ll think something is wrong with you. But still, when you show up in your casual clothes, are they pressed? Are they neat, do they match? There are ways to still look good and dress up even in a casual environment.

Everything we choose sends off messages. The way we say things, the way we act, and the way we dress actually do leave an impression on other people. It’s not just about what you do, it’s how you are perceived.

#2 DECLARE YOUR THOUGHTS

This one is aimed particularly at the younger generation and is meant to help them overcome what seems to be an unfortunate habit called “uptalk.” That is, ending with a high tone when you’re making a statement. Uptalk makes everything sound like a question. If you are an uptalker, you don’t “declare” your thoughts.

You can imagine how this would detract from your presence and the quality of what you’re saying. It makes you sound like you don’t know what you’re talking about, that you don’t believe it yourself. If you are an uptalker, you can use the same strategy I mentioned for ending verbal air pollution. Ask somebody point it out to you. In my teaching experience, I have found many people are completely unaware that they do this. I’m not even sure that they understand what I mean by it because it’s such a big part of their culture.

But as you move up the food chain in the corporate world or wherever you are, you’ll discover that people will notice that something is “off” and you need to get it under control. We need to own what we’re saying and be confident about it so that the people around us trust us. If they really believe that we believe it, then it’s okay for them to believe it.

#1 GET OUT THERE

My number one tip for giving off a more executive presence and being taken seriously at work is to simply “get out there.”

That means saying “yes” to every opportunity that you can get your hands on. A lot of people don’t do this because they’re nervous when they’re given an opportunity to do something they’ve never done before. I’ve noticed that this especially applies to women.

At my school, there used to be a golf tournament every year. I would sign up for it because I’m a golfer and when I would go, there would be all these guys and hardly any women. I would ask, “Where are the women students? Where are the women faculty? Why aren’t they here?”

The answer was that they voted themselves out of this experience. They thought they didn’t play golf well enough, or maybe they’d never played it before, and they didn’t want to embarrass themselves in front of recruiters who could possibly hire them.

The guys, on the other hand, took the opposite approach. A lot of them knew nothing about playing golf either but they saw this as an opportunity to get in front of a recruiter and have a few beers when it was all over. Who cares what happened on the golf course?

I’ve seen this time and time again with speaking opportunities. People say, “Well, I’ve never really done that before, so I don’t think I should.” Or they say, “There’s probably somebody here who’s better at it,” and so on. Too often, we vote ourselves out of incredible opportunities by saying no. You need to say yes. Don’t think about it. Just say yes.

If your boss asks you to do something, say yes now and figure out how to get it done later. This becomes an experience from which you can build and become more confident in similar experiences by simply taking on an experience that you’ve never done before. The more of this that you do, the more confident you will be when it comes to new things.

If you’re living an exciting and wonderful life, new opportunities will come before you all the time. Take them up. It will help not only your confidence but it will help with your executive presence as well.

 

Want to hear more? This article is based on Angela Noble-Grange’s live eCornell WebSeries event, Leadership Communication: Power Up Your Presence. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

Have a Great Startup Idea? Beware These Seven Pitfalls.

As a follow-up to his recent presentation on what makes a great startup idea, Cornell entrepreneurship expert Bradley Treat has returned to eCornell to discuss some of the common pitfalls that often keep great business ideas from succeeding. Below is an abridged version of his discussion.

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People often go down the entrepreneurial path only to discover that their idea actually won’t work before they’ve made it very far. What I want to discuss today is how to spot potential pitfalls in your business idea and address them early on.

Most of this presentation comes from a class I teach at the Johnson School called “The Business Idea Factory”, which helps students work through a business plan or business pitch.

YOU DON’T ALWAYS HAVE TO GO BIG

Most times, when we are looking for great business ideas, we look for really big markets. We’re thinking of being as big as Walmart, which basically sells everything to everybody.

But there’s always a counterpoint. The counterpoint to Walmart is a company called Fox 40, which makes whistles. The founder of Fox 40 was a hockey referee. As he was refereeing a hockey game, he went to blow his whistle – it was one of those metal ones with a little bounce-around cork thingy – and it didn’t blow. Maybe it was cold, covered with sweat or whatever, but it didn’t work. Some of the players saw him raise his hand to indicate a penalty but some did not and, as a result, a player got hurt.

He said, “Okay, I need a whistle that always works in all situations.” And so he developed a whistle that is loud and works whether it’s wet, cold, high-altitude, you name it.

When he said, “I’m going to make a whistle that always works,” was that a huge market? Of course not. But is it a great company? Yes. The whistles have become very popular with the military, the police and lifeguards.

My point here is that you can go big, or you can play small, and still find success.

HIGH MARGIN ISN’T THE ONLY MODEL

Another thing we tend to think about when starting a new business is high margins. We like businesses with high margins, but there is again a counterpoint to be made.

For example, Harley Davidson has extremely high margins on their motorcycles. And people who buy Harleys are not buying them just to get from point A to point B. It’s a state of mind, it’s who you are. You can go to a tattoo shop and choose multiple options for Harley Davidson tattoos. Harley is a brand for life and they tend to keep people. The motorcycle aficionados out there would probably say that if they made a list of bikes with the highest-performing, cutting-edge technology, Harley Davidson might not be at the top. But it’s that brand identity that gives the company such an extremely high margin.

Now look at Costco. I guarantee you will not find a Costco tattoo on anybody. But they do extremely high volume with extremely low margins. They just move a lot of product. Their number one product is toilet paper. So they’re a great counterpoint example of how a low margin/high volume model can work.

EXECUTION TRUMPS ALL

Let’s take Planet Hollywood. This company was started by A-list celebrities – Arnold Schwarzenegger, Bruce Willis, Demi Moore – but it went bankrupt twice. With that kind of marquee value, you might ask, how that is even possible? Or you could look at Dive!, a restaurant that was opened by Steven Spielberg, arguably the greatest movie director of our generation. But the thing bombed. He lost like $20 million on it.

What these examples have in common is that they prove that the success or failure of restaurants and bars is not the concept. It’s the execution.

Great restaurateurs make it look easy. They’re like professional basketball players draining three pointers. But if you want to be successful, particularly in the hospitality or service industry, it’s not about having a great idea. It’s about having the right experience. The truth of the matter is that there are very thin margins in the industry.

I mean, one of the most successful restaurants in the world is McDonalds. Their concept is not that special. It’s hamburgers and french fries. But just think about the volume of food they move. It’s almost unbelievable they can sell their food for as cheap as they do on the margin, but they’re very successful operators.

DON’T MISS THE REST OF THE ECOSYSTEM

Another thing to consider is the ecosystem. Most college students would agree that their textbooks are really expensive. But the textbook ecosystem isn’t just buyer and seller. There is the teacher, there is the institution, the publisher. It’s a very complex ecosystem.

So is the taxi business. It’s much more than just the driver and the rider. There’s a whole ecosystem of dispatchers and cab owners. There are also all the government regulations, and different rules for different places, such as airports.

At first glance, it might look like just two players, but in fact there are often many more. Understanding that ecosystem is very important. And it’s not only about understanding the rules and the players, but also the individual people involved that could impact your business.

NOT ALL ADVICE IS CREATED EQUAL

When you’re starting a business, you should be out talking to a lot of people. What you’ll quickly find is that you’re going to get a lot of conflicting advice. Some people will tell you that your best idea is A, others will say it’s B. What are you going to do about it? Whose advice should you care about?

Try the mosaic method. A mosaic, when you look at it up close, is just a bunch of broken ceramics. But when you step back, you start to see a picture. So you need to have a lot of conversations in order to see that big picture emerge.

The other thing is to make sure you understand the context in which people are giving you advice. A mistake many people make is to put too much stock in the advice they get from investors at the detriment of advice from potential customers. When an angel investor comes in and says, “Here’s what you should do with your business,” people tend to go, “Oh, well, they can write a big check so I should listen to them.”

I would actually discourage you from doing that unless you’re selling to venture capitalists. You should heavily weigh the advice of the people who are most relevant to your business, and if you’re already up and running, those who are actually using it.

ONLINE AD REVENUE – IT’S A TOUGH GAME

When people tell me their plans to do this and that in their app and I ask them how they are going to make money, they almost always say “ads.”

Well, the challenge with ads is the numbers just aren’t there anymore. The way that a lot of online businesses make money through advertising is described in terms of cost per thousand, cost per click, cost per action and so on.

The problem is, these prices have gone into freefall. The cost of ads has dropped precipitously. To make $3, you have to show a video a thousand times. To make $3 million, you’ve got to have a video that is seen 100 million times. Just do the math. You need just insane volume to make money off this.

When somebody tells you their big plans for an app and they say they are going to make money through ads, it means they haven’t thought about the business very well.

YOUR MOM ISN’T YOUR BEST CUSTOMER

The last pitfall I want to touch on quickly is confirmation bias. I see this a lot. Basically, when people are convinced that they have a great idea, they pay attention to all the data that confirms that their idea is great and ignore all of the data that says it’s a bad idea.

I guarantee if you talk to your mom about your business idea she’ll think it’s the best idea ever.
Instead of only listening to those whose inclination is to support you, you really need to go out there and talk to people who don’t know you. The best ones to talk to are your potential customers.

 

Want to hear more? This article is based on Bradley Treat’s live eCornell WebSeries event, What Makes a Great Startup Business Idea? Subscribe now to gain access to a recording of this event and other Entrepreneurship topics. 

Don’t Just Beat Your Competitors, Learn From Them

If you’re starting your own business, you need to know your competition. But rather than viewing your competitors solely as enemies, why not think about what you can learn from them? What are they doing right that you can emulate? Where are they underperforming and how can you use that to your advantage?

As part of our Entrepreneurship WebSeries, Stephani Robson, a senior lecturer at Cornell, joined eCornell’s Chris Wofford to talk through the process of analyzing your competitors. What follows is an abridged version of her webinar presentation.

Robson: Let’s start off discussing the idea of competition. A lot of people see competition as a bad thing. They think of it as somebody to be beaten, someone to be defeated. That’s actually a mistake, because your competitors are probably your best source of information about what your business should and should not be.

There’s a great quote that I like from Otto von Bismarck: “Only a fool learns from his own mistakes, a wise man from the mistakes of others.” That should be your major takeaway from today: competitors are a great source of learning. Think of your competition as someone you’re trying to absorb as much as you can from.

With that in mind, let’s talk about how to figure out who your competition is. A lot of people think competition has to be a company doing the exact same thing — but competition can come from many different angles. It really depends on what you’re trying to sell and what other entities out there are trying to do something similar.

Wofford: But how do you know which ones you’ll really be competing with?

Robson: There’s a method for identifying your competitors that we call “the three Ps.” The first one is “product.” What is it that you intend to sell? The second P is “price” — and by that I don’t mean a specific number, but a price range or a segment. And finally, the third P is “proximity”, which is how close that other business is to yours. Perhaps not physically close, because if you’re not doing a bricks and mortar business it’s not all that important, but certainly how close you are in terms of your mindset.

I typically break down competitive analysis into three parts: macro, vicinity and unit. In the first category, macro, you have competitors that may not be competing with you directly but you can still learn something from them. Next, vicinity, is simply whether there are businesses in your area, whether it’s a physical area or a virtual one, that are going after a similar customer base even if they aren’t necessarily competing with you directly. The last part, unit, involves looking very carefully at specific organizations that are direct competitors to you.

Wofford: It would be great to hear you expand on this.

Robson: Sure. As I mentioned, macro is referring to businesses anywhere that are going after a similar customer experience to what you plan to offer. As an example, let’s take a lemonade stand. If I were going to start my own lemonade business, I would want to look at businesses all over the place that were trying to offer the same kind of experience. That is, not just others selling lemonade, but it could be iced tea or ice cream or basically anything else that is a single serve refreshment that you could walk around with.

First I’d look to see what their product is. What are they selling? What’s the range of items they sell? How are those items packaged? How are they presented to the customer? What’s their price structure – do they have a range of prices or do they offer just one item at one price point?

As you know, people don’t purchase a product just because of a price – they’re looking at the whole value proposition. So when you look at a competitor – whether it’s something directly competing with you or something out there in the world that you think you can learn from – ask, “What’s the value they’re bringing to their customer?”

If I am starting a lemonade stand, I’m going to look at Starbucks and ask what value Starbucks brings to its customers. Very quickly, you’ll see that it’s not just about a cup of coffee. Part of the value proposition for Starbucks is that it’s a brand identity that people feel they can connect to. It’s also products that relate to the consumption of coffee that you may not necessarily think of. For example, Starbucks was one of the top sellers of music for a long time. So, what’s that whole package? What’s the value proposition and how did they do it?

Looking to see what competitors are doing in terms of how they execute is really one of the areas where an entrepreneur should spend a lot of time, even before they’ve really figured out their business. How you execute really makes the difference — it’s not so much about the product.

Wofford: Even a great product can’t save poor execution.

Robson: Are you familiar with the term “servicescape”?

Wofford: No, I can’t say that I am. What’s a “servicescape” all about?

Robson: Servicescape is essentially the environment in which the service takes place. It’s not just the room. It’s the lighting, the seats, the packaging, the branding. It’s the music and the smell. All of that is servicescape and a lot of very successful brands really use it effectively. You can learn a lot from competitors’ servicescapes about how to compete effectively and the things that are connecting with your customer base.

Wofford: I had a good servicescape experience with a lemonade stand. There are some kids in our village, maybe 10 years old, who did the fresh-squeezed thing in a little play area in the center of town. They made a boatload of money and I think that squeezing it fresh is what did it. You saw it being made right in front of you. That was their competitive advantage, right?

Robson: Precisely. For a kid to do that at a lemonade stand is just brilliant.

Wofford: What else should we consider when looking at how competitors provide service?

Robson: When you’re looking at a competitor’s servicespace, you also want to consider their position in the marketplace. Are they market leaders? How quickly are they growing?

Wofford: How do you access that information? How do you find another business’s growth plan?

Robson: Well, it comes from doing some detective work and some judicious Googling. For example, let’s take a business in the lodging sector. There is a company called citizenM, which is a small Dutch hotel company that is growing very rapidly. They have 6 hotels now and the plan is to open 9 in the next year, and 12 in the following year. I found that out by going to their website and digging up a press release.

You can usually find a lot online. A Google News search is often helpful. You can also read up on reviews to learn about the buzz surrounding the business. What are consumers saying about it in online reviews?

The things you really want to get at when you’re looking at these other businesses is how they are emotionally engaging the customer. We all know that in order to be successful in business, it’s really not about what you are selling. It’s about how you make a connection with the person who is buying it. Is it through the fresh-squeezed lemon right in front of the guest, or is it through the servicescape or is it through great social media use? There are always going to be strengths and weaknesses when you’re looking at competition and there are always going to be gaps in the market.

My background is in restaurants so I do a lot of work with restaurateurs and we talk about this idea of gap analysis. That is, a way of figuring out if there is room in the marketplace for your particular concept. So for restaurants, it could be asking if there is room for an old-fashioned meatloaf restaurant, for example.

Wofford: I don’t think there is.

Robson: Probably not, but with gap analysis, you can look at pricing and the quality of concepts that are similar to or adjacent to the concept you’re thinking about developing. You rank them on the two dimensions of price and quality and look for gaps. When you find the gap in that ranking, ask yourself why the gap is there. That will tell you something about whether your business idea is viable or not. There might be a very viable reason for a gap. Maybe there is simply no way to deliver the right experience at that particular price point.

Wofford: I’d like to turn to an audience question now if that’s okay. It’s from Caitlin, who asks: “This is all a little overwhelming. Do you have any advice on how to keep your head above water when getting started? ”

Robson: That’s an excellent question, because I’m throwing a lot of things out there for you to do. The best place to begin is to identify four or five businesses that you admire. They don’t have to necessarily be in your particular discipline, just organizations that you admire and want to learn something from. Then use this competitive analysis approach that we’re talking about to look carefully at those businesses. Once you’ve done that, you sort of get used to the process and if you want to expand it, you can then look at other businesses that are closer to what you are doing. What you want to try and take away is what they are doing right and how you can apply it to your business.

It’s important to recognize that sometimes your successful competitors may have advantages that are really hard for an entrepreneur to compete with. They may have a parent company with deep pockets, for example. To use the restaurant industry as an example again, a lot of people look at Chipotle and think, “I want to be just like them.” Well, guess what? Chipotle was bankrolled by McDonald’s so it’s hard to compete with that kind of money.

But at the same time, there are things that you can look at that might be weaknesses in those organizations. Is their execution reliable? Are they so limited in their offerings that they may be at risk as tastes change? Look for expensive operations that are doing an amazing job and try to come up with a way of doing things less expensively.

Another thing I want to touch on is ubiquity. There is an interesting phenomenon that when a business starts to grow so much that it is everywhere, there starts to be a bit of a backlash against it.

Wofford: This is like the Starbucks effect, right? There are so many Starbucks that people start saying, “I want the anti-Starbucks.” Or someone might want to start their own coffee business that is the anti-Starbucks just because they know they cannot compete with them head-to-head.

Robson: Right. I talked earlier about the concept of macro, which is looking at companies anywhere that are delivering a similar customer experience to what you are shooting for. If you are thinking of something bricks and mortar, then obviously it would be in the physical area that you are thinking of building or renting. If you are looking at a digital business, it could be businesses that are going to be offered in the same venue, like Apple’s App Store, for instance.

What you are looking for is who is there now and who is coming into the market, which can be tricky depending on what kind of business it is. You can also look to see who has failed in this marketplace and why they failed.

It’s also very helpful to look at online reviews. Look at the number of stars and look at the trend. Is there a lot of variation or is it pretty consistent? Look at the number of ratings and who is making the ratings. One of the nice things about these review websites is they tell you something about who the rater is. We know their age, where they are located, how many reviews they have written. I like to look at that very closely to see if the person doing the review is actually the kind of customer that we are going after.

A lot of entrepreneurs make the mistake of thinking that everybody is their customer. That is probably not going to be the most effective strategy. You need to nail down who your customer is and then the reviews from people who fit that profile are going to be much more interesting to you. If the type of customer you’ve identified is giving your competitor 4 and 5 stars, you know that business is probably doing very well at connecting with your customer.

Wofford: I have always found that written reviews are very good for understanding the kinds of expectations people have. Poor reviews are almost invariably the result of the customer not getting what they expected. On the other hand, a lot of good reviews talk about how their expectations were exceeded.

Robson: Exactly — and it’s also important to remember that you need to be careful with reviews because the two situations you’ve just described are usually what motivates someone to write a review to begin with. So I’m a little cautious about doing too much of a deep dive into the text and instead focus on the average rating.

Wofford: Right. People do not write reviews just to say, “It was okay.”

Robson: I’d like to wrap up by saying that you need to cast a wide net to learn as much as you can. You need to test your ideas. You need to be flexible. You need to be nimble. Those four things together are what describe most successful entrepreneurs.

Wofford: Stephani, thanks so much for joining us today. You really gave some great advice.

Robson: Thank you, I hope the viewers can use it.

 

Want to hear more? This interview is based on Stephani Robson’s live eCornell WebSeries event, Entrepreneurship: How to Learn from Your Competition. Subscribe now to gain access to a recording of this event and other Entrepreneurship topics. 

What Makes a Great Startup Idea

Bradley Treat is the type of guy that carries several business cards. He teaches entrepreneurship at the Johnson School at Cornell and at Ithaca College. He’s involved in the startup incubator Rev: Ithaca Startup Works. And he was also the CEO of the video and voice communications company SightSpeed before it was bought up by Logitech.

So the self-described serial entrepreneur was a natural fit to join eCornell’s Chris Wofford for a WebSeries event on what makes a great startup business idea. What follows is an abridged version of their conversation.

Treat: What I’m going to talk about today is actually an excerpt from a class I teach at the Johnson School called “The Business Idea Factory.” As people begin the entrepreneurial journey, they need to make sure they have some great ideas to start with. We’ll focus on giving you the tools to generate a lot of ideas and then help you filter out the best one and decide where to go from there.

To start the process, ask yourself: “What is a business?”

A business solves a problem that people care about. Someone has to be willing to pay for the solution. To break that down a little bit, the first thing we have to ask is, not what does your business do, but what problem does it solve?

Wofford: So this is really thinking about your potential customer in terms of what problems they might face and what kinds of solutions to that problem they’d pay for?

Treat: Right. Why do they care about solving this problem? Why should they be willing to pay you?

What I want to do next is give you some examples of businesses that solve problems. The first problem we’ll look at is the need to save money.

There’s a company called Forward Air, which is an air freight company that doesn’t own planes and a trucking company that doesn’t own trucks. What Forward Air does is to drive trucks between airports in the middle of the night.

You might say, “But Brad, why would somebody want to drive trucks to airports in the middle of the night?”

Well, what they figured out was a lot of air freight doesn’t have to go on planes. If you were to send an air package from Syracuse to Boston, you’d have to send it by 7pm. It’s not going to leave the FedEx depot in Boston until 7am the next day, so that’s a 12-hour period. They realized Syracuse to Boston is a one hour plane flight or a five-hour truck ride. So why not put that envelope on a truck and drive it to Boston? It’s much cheaper to drive mail than it is to fly mail. Forward Air figured out that they could handle a lot of airmail for the overnight carriers and save them significant money.

I also mentioned that this is a trucking company that doesn’t own trucks. One of the things Forward Air identified was the fact that many trucks sit idle in the middle of the night. So they went to truck owners and said, “Hey, your truck is just sitting there overnight. Let us use it. We’ll drive it, fill it back up with gas and get it back to you in the morning. You’ll make a little money instead of it just sitting in your driveway.” They identified a problem and solved it in a very unique and practical way.

Another example of a company solving the “Save Money” problem is a company called Kettleshell. This company invented a way to turn dumbbells into kettlebells. As you might know from the gym, a kettlebell sort of looks like a Civil War cannonball with a handle on it and there are a lot of workouts you can do with them.

Kettleshell converts a dumbbell into a kettlebell through a handle that bolts right on. If you’ve already got a set of dumbbells, you can now bolt this handle on and do kettlebell exercises using your existing dumbbells.

It’s a tremendous idea but interestingly, the founder originally thought he was going to save people money on not having to go out and buy a bunch of new kettlebells but it turned out that people in urban areas, particularly urban gym owners or urban apartment dwellers, were actually less concerned about the cost than the space. They didn’t have anywhere to put a bunch of kettlebells. So this product ended up solving two problems.

Wofford: It sounds like one of those products where you think, “Why hadn’t anyone thought of this before?” What about addressing problems that aren’t money-related?

Treat: Another area where businesses find success is in making something more convenient.
A good example is Sean Neville, the founder of Simply Audiobooks. Audiobooks are still something that people listen to on a physical medium because so many people listen to them in a car. So Sean developed a subscription service similar to the early days of Netflix, in which subscribers get mailed the audiobook CDs. Part of their innovation was coming up with a packaging sleeve that allowed the company to mail multiple audio discs at once. Unlike Netflix, which would send one disc at a time, Simply Audiobooks would send all of the discs required for a book, which sometimes could be as many as 12.

At the time Sean sold the company to a Toronto private equity firm, they had 25,000 customers and were North America’s number one audiobook rental company. Each one of those customers was paying an average of $25 to $35 per month.

To understand how valuable the convenience they provided is, you need to remember that their number one competitor wasn’t charging anything. Their top competitor was the local public library, where users could get an audiobook for free. But the convenience of having the audiobooks come to your home and being able to send it back and forth was worth $25-$35 a month to over 25,000 people. Convenience is truly valuable even if you’re competing against free.

Another good example is a Cornell company called Rosie. Rosie is an app to do grocery delivery. Now, people typically view grocery delivery as a luxury item for rich people. But what Rosie discovered was that rich people actually like to go to the grocery store. They like to walk the aisles at Wegmans. They like to pick out their own apples.

It turns out that the people who really need something like this are folks for whom getting to the grocery store is actually quite inconvenient. This is primarily people without cars. It could be students, it could be people who can’t afford a car, it could be people who choose not to have a car because they use public transportation for most things. But going to the grocery store is wildly inconvenient if you have to take a bus. You have to fit all of your grocery bags on the bus or you have to pay for a taxi, and that’s both inconvenient and expensive.

So what Rosie discovered is that although they thought they would be selling to rich people, their audience was really those who found the value in paying a very low delivery fee that was cheaper than a cab and more convenient than a bus ride.

Wofford: I know someone who has a modest income with three children under the age of two. With the inconvenience of trying to take the kids to the grocery store, this sounds like a no-brainer.

Treat: That’s a perfect example of who Rosie reaches. The company polled college students and asked why they needed a car and the number one reason given was for going grocery shopping. With Rosie, you don’t need a car anymore. I can also tell you that university administrations don’t like having to deal with a lot of cars and parking and all the permits. They’d prefer that students do not have cars. I also know that here in Ithaca, our mayor is very excited about it because he’s trying to figure out how to get people out of their cars from an environmental standpoint.

Wofford: So this company is actually addressing numerous problems at once.

Treat: Exactly. When you’re thinking about problems, think broadly. It’s not just about saving money or saving time. There are always creative ways of solving a problem for someone out there if you can deliver on it in a meaningful way.

One thing I really like to point out to people is that you do not have to come up with a business that nobody else has ever come up with. It’s a popular myth that a good idea is one that nobody else has ever had. But think of Google. There were all kinds of web search engines that existed before Google but Google came in and said, “Hey, we can do this better, we can do it differently, and we will be able to compete with all of these.” And of course, they didn’t just compete, they completely took over the market.

The way we see it is that if there are no competitors doing it, that’s a problem. It means nobody cares and you don’t want to try to solve a problem that nobody cares about. Having competitors is good — you just need to know your competitors and understand how you’re different and unique from them. If you can be slightly different or slightly better or target a different, underserved market, that’s a tremendous opportunity for you. Don’t get discouraged and just say, “Gosh, somebody already came up with that idea.” Revisit the idea and say, “How can I do it better? How can I do it different? How can I find a new market that is being underserved?”

Wofford: I think that’s great advice. It certainly seems easier to improve upon something that already exists than to invent something out of whole cloth.

Treat: It is. If you can understand how big a problem is for people or how you are better than the competitors at addressing it, you’ll have an edge. Focus on the problem you solve and then you can build an organization around that.

So, where do you find the ideas? You need to put on your entrepreneur glasses and look at the world in terms of problems that you could solve. If they’re big problems, people will pay to solve them. The bigger the problem, the more they’ll pay. Find somebody who has their hair on fire and they will pay you a lot to put it out.

Once you change your lenses and look at the world through different ways, you can actually start coming up with lots of ideas. I would encourage you to put everything on the list.

Wofford: Let’s say you have a list of 100 ideas. How do you know which ones are worth acting on?

Treat: There are certain criteria that we can use to define what makes a good business idea. You have to make sure it’s a good business idea for the customer. We want you to say, “I want to make what customers want to buy.” That should be the focus rather than trying to sell something that you want to make. Understand the customer and build an organization accordingly.

Wofford: I’d like to now turn to the audience and take some questions. We had a good one come through from Lawrence in the chat window while you were speaking: “How should a successful startup value its equity prior to seeking angel funding?”

Treat: I would actually encourage him to not value it. I know that sounds like a dodge, but valuing early-stage companies is extremely difficult to do. It becomes a sort of a thumb in the wind.

Still, there are techniques we can use, the most notable of which is something called convertible debt. What this says is that any money that comes in will be valued at some future date and there is a whole mechanism for doing it. You can actually find a lot of these templates online but basically what it says is you put the money in now, that money will earn interest, and then at some future date it will convert into equity once we have a better way of determining valuation.

Wofford: Here’s another great one: Once you’ve got a good idea for a new or improved product, what’s the best way to go about getting it out there?

Treat: Let’s go back to the Kettleshell example. He made the handle that goes on the dumbbells and he thought he should go out and build a prototype out of steel, aluminum, rubber handles — the whole thing. I said, “Don’t do that. Just make a mock-up.” So he went over to the art supply store, got some styrofoam, some duct tape, and some spray paint. That was enough to make a mock-up that he could put into gym owners’ hands. They were then able to give him feedback and suggest some changes. That styrofoam version turned out to be way more valuable than had he made the real thing. He was able to get pre-orders based on a CAD drawing, essentially. The more you can talk to customers, the better.

Wofford: We’ve got another audience question here, this one from Rohit in India. “I have a great product idea, but building it requires funding. I’ve done my research and believe this product will be the first of its kind. Where and how do I begin?”

Treat: Well, as I said earlier, it is rare that I find something that’s truly one of a kind. So I would challenge Rohit by asking how people are currently solving the problem that his product addresses. You may be solving it in a unique and different way, but how are others currently solving it? If you can go out there and talk to customers and find out what their needs are, then they’ll help you build the products.

I would challenge you, Rohit, to think very creatively about how you can get a minimally-viable product. If the guys from Kettleshell can do it with Styrofoam, then you should be able to creatively come up with some way to demonstrate your product.

Wofford: We have a question from Lance, who asks if you can recommend any other resources for generating ideas.

Treat: The best way to come up with a lot of ideas is to talk to a lot of people. Ask them open-ended questions about what problems they face. The more open-ended, the better. What’s your top expense? What check do you hate writing each month? What is one thing that you do in your job that you wish would just go away?

If you’ve currently got a job, look at the company you are at right now and ask yourself “What’s something that my company does now but shouldn’t be doing because it’s not our core business?” That could help you spin it out into a whole new business.

Wofford: Those are all great ideas. We’ve unfortunately run out of time, so I want to thank Brad for joining us and thanks to all of you in the audience for posing such good questions.

Treat: Thanks Chris, this has been fun.

 

Want to hear more? This interview is based on Bradley Treat’s live eCornell WebSeries event, What Makes a Great Startup Business Idea? Subscribe now to gain access to a recording of this event and other Entrepreneurship topics. 

How to Plan and Prepare for Organizational Change

The Greek philosopher Heraclitus said that “the only thing that is constant is change”. This is true both in life and in business. Organizational changes are inevitable. It’s how we handle them that matters.

As part of eCornell’s Women in Leadership webcast series, Amy Newman from the School of Hotel Administration at Cornell University joined eCornell’s Chris Wofford for a discussion on how to effectively communicate and prepare for organizational change. What follows is an abridged version of their discussion.

Wofford: Amy, it’s great to have you again.

Newman: I’m glad to be here. Thanks for having me.

Wofford: Amy and I have done this before. About a year ago, we did a webcast on crisis communications. That’s pretty related to this but tell me, Amy, what are we going to learn here today?

Newman: The focus is on managing a change and communicating that change. What I’ve found is that organizations are pretty good at implementing change but they often forget to actually communicate with people both internally and externally. Sometimes, the external communication seems to be the priority in companies. They’ll tell their investors and their customers but often forget that employees are important ambassadors of the change and are the ones who will actually implement the change.

Wofford: All right. So what is the value of communication planning?

Newman: Well, let’s look at some research. In a paper published in Corporate Communications: An International Journal, Wim Elving identified four goals of change communication. The first is to increase buy-in and decrease resistance. We know that people naturally resist change, so the more we can do to prepare them to increase readiness, the more likely that they’ll buy into the change. So that’s one component.

The other is obviously to inform the audience. People need to know there is a change. They need to know how it affects them and what they’re going to be doing differently. Those are kind of the basics, but they’re essential.

Next, we have creating a sense of community or a sense of belonging, and this is the piece I think people don’t really think much about. When people hear there will be organizational change, they worry about layoffs or worry that they’ll have more work to do. There’s a tendency to focus on the negative results of a change, so you want people to feel like they’re part of the process and they’re going to be a critical piece of the organization going forward.

And then finally, it’s important to reduce uncertainty. You need to let people know what they can expect and what is expected of them. This also gives you a better chance that your change is going to be successful.

Wofford: I think a lot of people in the corporate world have probably experienced situations in which hirings and firings and big, sweeping departmental changes don’t always tend to be communicated very well.

Newman: Absolutely. And I think the tendency is to not communicate for a couple of reasons.
One, we simply forget because there are all these logistical things to deal with. But I also think people don’t like to deliver bad news, so they think it’s better to say nothing at all. Of course, that’s not true.

There are really two types of communications strategies for change. One is to inform people of what’s happening, but the second is critical and that’s about creating a sense of community.

I’ll give an example. When Marriott acquired Starwood last year, in one of the early messages that Arne Sorenson, the CEO of Marriott, sent to Starwood associates announcing the change, he said, “It’s strange for us to go from competitors to teammates.” I thought that was just such a great way to say it. He acknowledged that, “Yeah, this is weird.” First we were competitors and now we’re supposed to be part of one big happy family. Everybody’s thinking it, so acknowledging that up front makes people really feel like they’re part of the process.

Wofford: That we’re all in the same boat.

Newman: Exactly. Honesty like that reduces uncertainty and job insecurity. It prepares people for the change and then it ensures an effective change.

Now I thought that there was one goal missing from Elving’s work that I added and that’s to prevent a crisis situation. If you’re not communicating well, at some point your employees can be angry at you. So can your investors or your customers. And we know that social media will respond.

Wofford: There will be a whistleblower tweet out there or something like that, right?

Newman: Yes… It could go viral and, suddenly, in addition to trying to communicate the change, you now also have a crisis situation to handle. So it’s best to get out ahead of things even if it’s bad news.

Wofford: Like in The Godfather when Tom Hagen says, “Mr. Corleone is a man who insists on hearing bad news at once.” Obviously that was great advice.

Newman: That’s right. With bad news, you just need to get it out. In my classes, we talk about indirect communication and direct communication. The older style of thinking is indirect communication for bad news. You know, soften the blow. I don’t think that really works anymore. People want to hear what it is and just get past it.

Wofford: So that’s good advice for crisis avoidance?

Newman: Absolutely. I can share an example where the planning may have not gone so well. This is the Carrier situation and I know it’s a very sensitive one. President Trump got involved.

Wofford: The heating and air conditioning manufacturing jobs in Indiana?

Newman: Exactly. They announced that this plant was moving to Mexico and they did it in a large forum. I mean, I’m not so sure what would be a better choice really, maybe smaller department meetings. There’s no great way to tell 1,400 or so employees that they’ll be losing their jobs but, in this case, someone had an iPhone and recorded it and that’s what went viral for everyone to see. So it did not turn out so well for them and it’s something that they really should have thought about in advance.

I think part of the communication planning process is that you have to assume that any internal message is going to go external.

Wofford: You’ve developed an actual change communication plan, haven’t you? Should we get into that now?

Newman: Yes, I have something that I’ve used for many companies. It’s something to be used for major organizational changes like a merger or acquisition. But even with small department changes like a new system implementation, it would be helpful to think about who we need to communicate to and what our messages are.

Wofford: Okay, so how does it work?

Newman: The major categories are to identify the audiences, to do some work thinking about their potential reactions and to look at some communication objectives. What media or channels are you going to use? What is the timing?

Let’s start with the audience and their potential reactions. I put together a sample involving the closing of a restaurant. In every situation, this is going to be a little bit different but this is the way you might think through that kind of change.

The first thing I would do is to identify all of the audiences. Usually, we get into something called cascading communication where most likely you’re starting at the senior-most level of your organization and working your way down. You’ve got to think about the levels of management and the level of employees involved. So in this case, I’m saying the corporate management team, the restaurant management team and then the restaurant staff. Clearly they need to be notified pretty quickly. The corporate staff might be next and then you might have to notify the local government depending on the local laws. You may want to directly reach out to some VIP customers. Maybe the media will be next.

They all get different messages, different media choices. All of that has to be thought through.

Next is to look at the background of the different audiences and their potential reactions. This is the step I often find is missing. It’s really about empathy, about trying to put yourself in someone else’s shoes. It’s thinking through some of those potential, particularly negative reactions and trying to address them.

Wofford: Right. What else is involved in your template?

Newman: First, let’s look at the communication objectives. You want the corporate management team to understand the rationale and details and then you have to plan communications for their team. And when you’re coming up with these communication objectives, I would really recommend to once again think from that audience’s perspective.

The next thing to consider is responsibility, and this is easy to identify but a little harder to carry out in the communication plan. If we’re using this cascading communication, the corporate management team would communicate to the restaurant management team, for example, and the restaurant GM would communicate to the restaurant staff, probably with the help of H.R.

Next we’ve got to decide on our communication media or channel. You know, the default communication channel is most often email. For 12 years now, I’ve been hearing about the death of email. I’m still waiting for it to die.

Email is particularly effective in communicating bad news. Can you think about why?

Wofford: Well, it’s directed at me. I mean, people are tethered to their phones, right? So there’s an expediency to it.

Newman: Right. Plus, everybody’s getting the same message at the same time. In layoff situations, companies will usually send those messages on a Friday and then people go home so they’re not in their office angrily talking to each other and getting each other riled up.

But there is a downside to email. Many people would prefer a call, or better yet, a face-to-face conversation. So that’s a decision that really has to be thought through.

The last component here is about the dates or the timing of the messages. It is important to think about who should know what and in what kind of sequence. I’ll go back to the Marriott Starwood example, because I think they did a pretty good job overall.

When the announcement was first made, and this was back in November 2015, there was an email from Starwood executives to Starwood associates with a press release that hadn’t gone out yet attached. That was really the first communication, as it should be, because this was an acquisition, not a merger. Starwood associates are the ones who are thinking they might have the most to lose. When that email went out, it was presumably the first that anybody had heard of this.

Next, we get an email from Marriott executives to Starwood associates that came less than two hours later. Clearly this was all well orchestrated and planned. And that was the message I mentioned before, where they say it’s strange to go from competitors to teammates. It was just a very welcoming message. There was also a video with Arne Sorenson that was lovely.
Then, we had the press release. That public announcement was a little later in the day, but at this point employees already knew that it was coming. In other words, they didn’t have to read about it in the press. All of this happened within three hours of that first message.

Wofford: Amy, thanks so much for joining us once again and thanks to all of you who tuned in.

Newman: Thank you, Chris. It’s been a great conversation.

 

Want to hear more? This interview is based on Amy Newman’s live eCornell WebSeries event, Communication Planning: Preparing for Organizational Change. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

Want Better Data? Build from the Bottom Up.

At Cornell University’s Center for Hospitality Research, one of the main aims is to make research available in a digestible format for those in the hospitality and service industries. A large part of that work involves helping the industry not only collect significant data but to make sense of it in order to make better business decisions.

As part of eCornell’s webcast series, the center’s director, Professor Chris Anderson, joined eCornell’s Chris Wofford for a discussion on data analytics and why industry professionals should adopt a bottom-up approach to data. What follows is an abridged transcript of their conversation.

Wofford: Welcome. Let’s talk about data-driven analytics and what the bottom-up approach means.

Anderson: The first thing to note is that good analytics is not necessarily new. I’ve been in this space for a little more than 25 years now. What’s really happened in the last five to ten years is that analytics have become much more accessible — and with that new accessibility comes lower costs. As a result, it’s become much more widely adopted.

But I think we’ve kind of lost a bit of what I refer to as the bottom-up approach, which is involving those who are critically close to the business itself in the data analytics. You need to have an understanding of where that data came from, what potential variables you’re missing, and how it was sampled. In order to get the most out of data analytics, you need a firm understanding of the business itself and how things should be working towards some sort of outcome. In the opposite scenario, the top-down approach, we let technology tell us what’s going on and we sort of let the data drive the solution.

Wofford: Can you give us a real-world example of what you mean?

Anderson: I come at this historically from the hospitality space, from the demand and pricing side of things. That space to me has always been fascinating because, in order to price and control a hotel or an airline, you really have to have a fundamental understanding of where demand comes from, how the business manages that demand, and what kind of decisions they can make. You really get this deep insight into how you make money.

So for a lot of data analytics, that becomes this core set of skills and once we’re good at it, then we really understand our business well and it brings a lot of opportunities for us.

Wofford: What kinds of data analytics are relevant to the hospitality and service industries?

Anderson: There are three basic forms of data analytics. The first is what we refer to as descriptive, where we’re just describing what has happened or just reporting. It’s kind of a backward view of the world.

Our second is the predictive world, it’s the forward-looking part of analytics where we’re trying to use our insight from reporting to help us look at relationships and make predictions about the future. And then predictive analytics goes one step further and tries to see what factors resulted in us achieving previous metrics, what we might do to impact those and what the future outcome might be.

The third part is prescriptive analytics. Once you understand where you’ve been and have a good sense of how to go forward, then you want to use some tools and techniques to make sure you’re going forward in the profit-maximizing or cost-minimizing sort of way.

It’s about using a set of tools to help us do the best going forward, given the insight that we’ve been able to extract from this both descriptive and predictive framework.

Wofford: What are those tools? What are you looking for within the data?

Anderson: We use things like optimization, where we are looking at making multiple decisions at a time. We use things like decision analysis and programming.

We work on incorporating uncertainty into our decisions. No decision is made out of certainty, so we don’t want to just ignore that. We want to make decisions knowing that there is some uncertainty and once I make one decision I can adjust to those uncertainties and make subsequent decisions.

We use different tools if there’s a lot of uncertainty that’s evolving over time and we might use another set of tools if there’s so much complexity that it’s hard for us to map out how things are all working together.

We think about the starting block as being reporting. Your goal is really to understand how well you’ve been doing, so you’re focused on key performance indicators. How was I pricing? How was my competitor pricing? We are just looking at some of these things together in concert with our backward-looking metrics.

This really lays the groundwork of the predictive part, in which we are trying to understand that these things may be impacting some of our key performance indicators, and we may look at those in different ways.

Even before we can start to do this we’ve got to collect the data, put it in a data warehouse, and have it organized in some sort of centralized way. One of the trickiest parts about this is we have to make sure that we have a lot of integrity around that data. We want to have a secure process from which we can extract, pull and analyze, but we don’t want to necessarily change that underlying structure.

There are a lot of pieces we have to make sure are lined up so that if we have lots of users, they are not going to distract from the quality of that data.

Wofford: In your experience, do you find that most companies have their data in order or when you go to work with them, or do you find you have a lot of work to do right out of the gate?

Anderson: For most organizations, it’s about getting their data house together. It’s often not well organized.

Wofford: So getting that data organized is almost always the biggest challenge?

Anderson: That’s right.

Wofford: Once things are put in order, are we then looking at the predictive component? You mentioned using this to reduce uncertainty – how do we do that?

Anderson: Well, let’s say you are looking at what your sales were last year. That would provide a naive estimate for the next year, right? But while you might be able to take last year’s average, there is a lot of variance around that average. So our goal is to generate a better estimate for the future that has less variance around it, so it’s a more refined guess. We try to make less naive guesses by using information from other attributes that may be impacting sales. If we know those factors going forward, that will help us refine the estimate for whatever that metric is, whether it’s sales or some other key performance indicator. The predictive part is all about reducing uncertainty and we do that through different kinds of relationships.

Wofford: Like competitive analysis, for instance?

Anderson: Right. How my competitor is pricing relative to how I’m pricing. But we have to be cautious because there’s no point in looking at the impacts of relationships unless you know those factors in the future. My sales are a function of how I price and how my competitors price but I don’t necessarily know how my competitors are going to price tomorrow or next week or next year.

Once we’ve got those two parts under our belts – the reporting and the predictive – then we can start to make better decisions going forward instead of just shooting from the hip. And that entails using a lot of these mathematical tools, along with our knowledge, intuition and expertise, to look at some of this complexity.

The prescriptive part is getting us beyond just making obvious logical decisions and trying to look at how things are interconnected. We don’t necessarily jump into this part unless we have our foundations in the information because the prescriptive modeling component is going to need inputs from reporting or inputs from our predictive components. They’re the critical first two steps before we get into part three.

Wofford: And the prescriptive element involves running a simulation in some way?

Anderson: Yes, you could think of it like that. You can think of a hotel trying to set optimal prices to maximize revenue. To do that, the hotel owners have to have some estimate of future demands and ideally some estimate of future price-dependent demand. That estimate of future price-dependent demand from our predictive analysis will then be input into our optimization models to help us formulate those decisions going forward.

Wofford: We hear a lot about things like “text analysis” and other new techniques that help us look beyond simple numeric data. Can you tell me about that?

Anderson: Think of Amazon reviews. We’re selling products on Amazon and we’re looking at what consumers are saying. We have to be cognizant that other consumers are reviewing that content. They’re paying attention to that average review score on Amazon but they’re also actually looking at what people said about the product. So we need to look for keywords and repetition of those keywords.

Yes, I could read all that information manually, but we can now use tools to help us pull up keywords and their frequencies to help us get a sense of what’s going on.

Wofford: I’m guessing this is probably common across all industries at this point.

Anderson: Yes, because now you can review anything. And there’s hardly any business that doesn’t have some sort of online chat service where consumers are typing information. So it’s about trying to look at what questions they’re asking, what problems they’re having with your product and then asking yourself how you can use that data to improve the product.

There’s just so much unstructured text today so we’re trying to look for ways to streamline how we extract insight because we don’t have infinite time to read it. Most of the tools for analyzing text are pretty standardized and most of the algorithms that we can use have been well developed. We’re ten-plus years into things like sentiment analysis so it’s not like we have to reinvent the wheel. There are a lot of off-the-shelf approaches.

Wofford: I’d like to turn to a question from the audience. Peter, who identifies himself as a “non-analytics person” posed this question: “In terms of decisions, I sometimes hear, ‘The numbers don’t support that.’ But it’s often on content that I know has not been marketed. So it seems the decision may be made on numbers that are correct, but that the decision comes from a faulty premise. Is this something you see often?”

Anderson: One of the classic things that I see is that organizations think price is going to impact demand, and they think they are changing prices but what they’re really doing is moving prices seasonally. And when things move together, you can’t really tell the impact of the season versus the price, because those are both adjusting together.
So one of the things we see in that data is that we may not have created the right kind of variance in order to see the outcomes.

Most of us don’t experiment with our business on a regular basis but in order to get insight from data, we have perturb those inputs. It’s just like the science experiments with two petri dishes, where you pour bleach on one and not on the other one to see what kind of bugs grow.

We have to have that experimental mindset when generating this data, because if we’re not making those little perturbations to our business practices, then it’s very hard for us to see how A leads to B because we’ve never manipulated A. Or we’ve only manipulated A at the same time we’ve manipulated B, C and D. If I always drop prices and spend more on marketing together, it’s hard for me to unravel which of those was the driving factor. Our data will not tell us that unless we’re cognizant from the business standpoint of having manipulated those things in such a fashion to generate that variance.

Wofford: So to glean real insight, you’ve got to be willing to take risks?

Anderson: Right. Be like a scientist and do some experimenting. You know, the online world has dramatically changed because of what we call A/B testing. Now it’s so easy to tweak something, so we can do all of these little A/B experiments. It’s very easy to create variances and see the outcome.

Wofford: So in some ways, you describe this as a linear process, but at the same time, it’s not. It’s iterative.

Anderson: It is. One minute to the next. The goal of predictive analysis is to look for robust insight into the future. And that is where, for me, the bottom up approach is critical. Yes, we’re trying to understand your business model but nothing is constant. There could be a new competitor, underlying changes in dynamics or some sort of disruption happening. In order to be robust to those changes, the models that we build from the predictive framework have to be grounded in our business practices.

And that comes from this bottom-up approach, versus just letting the data tell us what’s going on. For me, as a data analyst, it’s always about thinking about my two minute elevator pitch. How do I justify my models and can I clearly explain those models in layman’s terms? If I need to use statistical terminology to explain my insight and my models, that is going to tell me that I’m not necessarily grounded, that I’m relying on the data versus relying on my intuition.

It’s some give and take. You have to go back and forth, but the more bottom-up you are, the easier it is for you to justify models and to communicate those models to other people.

Wofford: I want to thank Chris Anderson for joining us today.

Anderson: Thank you, Chris, this was great.

 

Want to hear more? This interview is based on Chris Anderson’s live eCornell WebSeries event, A Bottom Up Approach to Data-Driven Analytics and Why We All Need to Be Involved. Subscribe now to gain access to a recording of this event and other Hospitality topics.