ARE YOU STIFLING INNOVATION?

As we work with companies large and small, we see a management trait that is stultifying innovation, new ideas, and open discussion.  Leaders who are too vested in their own opinions and view other opinions as an attack on their expertise are becoming more common.  I have personally seen ego-driven C level executives not only override other’s ideas without considering them, but then force everyone in the board room to parrot their particular point of view.  Whatever the cause, it is detrimental to your company’s growth and agility, and leaves you unable to adapt to new competition or market shifts.

Being too invested in your own ideas and failing to consider how you could be wrong makes it nearly impossible to be open to something new, especially if it contradicts your current assumptions.  This will result in your managers bringing you only those projects and ideas they feel will align with your current “world view” and forego other ideas as being too risky to bring up.  Your competitors are more likely to break ground with an exciting new innovation if this is your company culture.

The HIPPO effect is another way that small to medium sized companies compromise their innovation.  HIPPO stands for “highest paid person’s opinion”, and many meetings simply end up defaulting to what the boss thinks, rather than pursue ideas from the trenches.

Finally, your organizational chart could be the problem with fostering innovation.  Chain of command works well with issuing orders and executing decisions, but it can bottleneck any new ideas or practices. Creative ideas that come from the middle or lower levels of a hierarchy have to work their way up through a series of managers, each with the power to veto but lacking the authority to implement the idea.  Changing a communications policy and allowing for ideas from the field to be vetted from the top, without having to hurdle mid-level managers, can do wonders for innovation and company morale.

For more on this and other topics, BASE offers a free one-hour consultation that you can register for here: 

 

http://baserev.omb10.com/welcome

 

Rotten To The Core?

Why does your Personal Trainer keep harping on core exercises? The answer is simple – all progress comes from a good foundation. It’s the same with an organization; if your core principles (or principals) are rotten, your company will exhibit the same characteristics.

Think of it in terms of how it affects your employees. If they function in a culture where they are constantly looking over their shoulder for threats from within, they will never be prepared to do battle with external threats like competition, economic strife, etc.

I have seen this first hand in large companies. Politics, disingenuous leadership, poor communication and strife leaves middle management and the rank and file virtually paralyzed, waiting for the next bomb to drop. No new ideas are forthcoming, lest they be criticized or worse – the person proposing change can be labeled as a “poor team player”.

In our industry alone, witness how poorly prepared the large operations were for the onslaught of the HVLC model, and then again taken by surprise by the boutique gyms. These large companies were in a perfect position to take advantage of the studio concept, yet are still stumbling around trying to play catch up, and doing a poor job of it for the most part. This is what happens when you use people to make money, instead of using money to develop people.

Is your company spending a portion of its revenue on continuing education ? Do you have a budget set aside for this, complete with goals for employee turnover and development? If not, we suggest installing these immediately. Of course, we would be happy to assist you in this endeavor, but get help somewhere if this is not your forte.

Your employees will appreciate the new outlook and support. There is simply too much competition out there to be rotting from within.

What If You Just Gave Up?

I’m certain everyone reading this has learned something through repetition. Maybe it was a musical instrument, or a particular skill. Perhaps it was a sport you were interested in, and had to go to practice until you became a valued member of the team. Children are taught new things all the time, and are told they must evaluate what they learn through homework, testing, etc.

Imagine what would have happened if you had given up immediately on learning to read, or riding a bike – where would you be? Repetitive behaviors encourage proficiency and hone skills; however, we see the reverse of this in the business world all the time.

New practices and techniques are discarded almost immediately when immediate success is not achieved. “That won’t work in this market”, or “I tried it but it wasn’t effective” is proclaimed after a few casual attempts. Where did that kid who practiced his/her soccer skills for hours in the park go?

Overnight success usually takes about 10 years – rarely does anything of value come immediately. If it did, everyone else could also do it and your skills would be worthless. You are not going to go to a convention or seminar and immediately be adept at the things you learned there. Practice, repetition, and supervision combined with critical thinking is vital for success. You are responsible for the success of a team or a business, and it is incumbent upon you to be the coach – do not let them give up simply because they are not succeeding right away.

Doggedly pursuing an activity or procedure that has proven ineffective isn’t smart either, but how will you know if your staff has taken a few cursory stabs at it and reported that it doesn’t work? We have gone into many businesses and seen exactly this scenario – a staff that is threatened by change and therefore torpedoes any new initiative that might result in more work. As a leader, you must drive change through effort. Training, practice, and honest evaluation of results – none of this happens overnight.

For information on staff training, new techniques, and what to measure for success, please contact us for a free one-hour business consultation.

SINCERITY SELLS…

I’m fairly certain all readers have had the experience of hearing a breathless, excited announcer explaining that this is the last possible chance to get a great deal on a car or truck from XYZ dealership.  In fact, even paying close attention is not enough to decipher the disclaimer that precedes this announcement.  This disclaimer is forced by law, due to the lack of transparency in these ads, and is of course sped up to get it in while still providing enough time for the bloviating afterward – “you will never see prices like these again!”

If you are not falling for these kinds of advertising, neither are your customers.  We need to train our associates and keep them from using absolutes and hyperbole; it comes off as insincere.  This kind of pitch – “Final Days”, etc., has been a part of this industry’s history for too long.  Many of our potential customers have their guard up as they enter our facility, much the same as they do when they pull up to a used car dealership.

How can we expect our clients and customers to purchase more product and services from us when their initial contact was handled in this way?  Simply pointing out our facility and shiny equipment, followed by a curious “discount” that ends when they leave, is a great way to lose credibility in your market.  Instead, your counselors need to learn how to properly interview each potential member and determine what their needs are.  A professional presentation allows us to look our customers in the eyes and tell them how to achieve their goals with us.  This takes training, but virtually anyone can learn to do this if they believe in the product exhibit the lifestyle.

Often our advertising can be a big part of the problem.  While price-point ads can be effective in some instances, they demean your value when used too often.  We would do well to remember that we are asking people to spend a relatively small amount of their discretionary income on our product, and there is no good reason for them to refrain from coming to us for their health and fitness needs. If we present ourselves in an unprofessional manner, we will lose them right from the start.

Simply put, when it comes to “Final Days”, they’re just not buying.

Contact us for a complimentary one-hour consultation on this or any other facet of the industry, and watch for our webinars and training sessions throughout the year.

 

 

DON’T DISCOUNT – DIFFERENTIATE !

You’ve been plugging along, doing fairly well.  Your facility offers a variety of programming and a solid group of employees who are genuinely liked by your customers.  Your pricing is reasonable, and your staff does not experience too much push-back from their prospects when trying to grow your membership base.  Suddenly, you find yourself faced with a new competitor; one of those high volume low cost models has set up shop in your market, generating a buzz with their cut-rate, loss leader pricing.

Now your sales personnel are asking questions.  How can we compete with them?  Our members are going to go there to save money, or ask us to lower their dues, etc.  You start to worry about the competition and what they are doing, completely forgetting what you do best.  The first couple of cancels come through, and you hit the panic button – we have to match them with price.

In most every instance, this is the worst thing you can do.  Unless you have been running roughshod over your current and potential customers, delivering shoddy service, questionable sales tactics, and alienating your market, you do not need to lower your price or standards.  (If you have been doing these things, you’re already dead in the water).  Think of the things you provide that the HVLC model does not, and emphasize these.  Create some new programming or add an amenity such as a group training program, specialized cycle, etc.  Remember – if fitness was simply a race to the bottom, there would not be such a proliferation of boutique locations charging $150 per month.

It’s going to take leadership to distinguish your company now, not just advertising.  Employees must value your product and pass this feeling on to your base, as well as your prospective clients.  Members do not quit relationships, but they do quit machines.  If you have a strong personal training program and group exercise program, the HVLC model does not have to impact you long term.  I have seen too many operators panic and discount their pricing, only to destroy their brand, antagonize their current members, and ultimately end their operations.  Stay strong and have a plan – don’t lose your dream to a model that promises nothing, and delivers less.

BASE offers a free, one-hour consultation to discuss your business needs – contact us today to schedule

Should holding people accountable be so difficult?

I remember working as a teenager, helping with some light construction – actually digging ditches, or painting, or lugging equipment around.  There was never any question as to what my job function was, and what the consequences would be if I failed to do it.  Imagine a situation where your foreman gives you and two coworkers shovels, and tells you all to start digging a trench.  He knows full well that 3 people working diligently can excavate a trench that is 30 linear feet by one foot wide and one foot deep in less than 3 hours.  He tells you to get started at 9 am, and he’ll be back at noon to check progress and break you for lunch.

At noon when he arrives, the trench is only 50% complete.  One of us says we forgot how long the trench was supposed to be and assumed we were done.  The second laborer says “my hands hurt, so I stopped”.  The third explains quite logically that digging a trench is work that he is overqualified for, and therefore he has a new suggestion for the foreman as to how to best utilize his talents.  What do you think would happen at noon that day?


All three of us are run off, of course.  Fired on the spot, as we should be.  The expectations were clear, the tools were provided, and we each came up with excuses not to perform the task, both singularly and as a team.  Why is this so hard to translate to the business world?  Why are we so much more lenient on “white collar workers”? 

Perhaps it’s simply that we have accepted excuses for far too long when it comes to this kind of work.  I am not suggesting an authoritarian approach per se, nor am I advocating a “drill sergeant” mentality to management.  Setting expectations and being willing to hire and train replacements will go a long way towards outfitting your company with the right people.  You will have to roll up your sleeves and do the work, or hire someone from outside the company if you need a change of culture.  Do not be afraid to make changes, however, if you are not hitting your goals due to employee apathy or a lack of compliance with company policies.  Once this becomes commonplace, you will have a systemic problem on your hands; one that will undermine everything you are trying to accomplish.  When managers are unwilling to do the follow up and training necessary to affect positive change, they cede control to those who may not have the company’s best interests in mind.

Setting the proper expectations, providing the tools, and training the staff will make your business:

1.       More fun to work in.

2.       Less stressful to manage.

3.       More profitable to own.

If you’d like to hear more information regarding changing your corporate culture, please contact us today.

What To Do When Your Sales Staff Stops Selling…

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Revenue is falling – it happens to most companies at one point or another.  Sales personnel begin making more excuses than phone calls, ignore leads or fail to procure more of them, and settle into a “culture of mediocrity” that is the antithesis of a successful, thriving company.  While the best way to prevent this is to see the signs early, there are still some proven methods to combat this without having to turn over the sales department and hire new employees.
Compensation
Take a close look at your comp plan, and judge whether you have created incentives for behaviors that benefit your company’s long term goals.  Over time, many firms end up with very complicated sales incentives and tiers.  The same sales personnel that claim they are helpless to effect change in their production are very adept at figuring out how to maximize their income.  When a disconnect occurs between your company goals and their compensation plan – you will lose every time.  Reevaluate all of your commission and bonus plans – get involved at the ground level and talk to staff.  Don’t let the accountants in the office try to drive behavior until you have learned what is going on in the trenches.
Coaching and Training
Just as professional athletes need coaches to keep their skills sharp, so do sales personnel.  Bad habits develop, techniques that worked are abandoned in favor of short-cuts, and laziness sets in.  Simply imploring them to “do better” will not only frustrate them, but also waste your time.  Keep them educated, trained, and challenged.  Expose them to information that comes from outside your company, even if it is from different industries.  The best motivation for change comes from new information; you have to teach first, then take control.  When you have taught them something of value, you will be operating from personal power versus position power – this is the difference between a leader and a boss.
Establish and Enforce Expectations
Until you are measuring all the Key Performance Indicators, you are simply coaching the final score.  Anyone can exhort their staff to “try harder” or “work smarter” – these are meaningless phrases that roll off their backs and do not address the real opportunities within your business.  Every time you decide to ignore a behavior or metric that is contrary to your business success, you set a new standard for your staff.  Daily feedback based on performance indicators is necessary to both reinforce good behaviors and identify bad ones.  You cannot measure your business success without financial reporting – nor can you manage your revenue with your personality.
Of course, all of the items mentioned here require hands-on training and management. Find a professional from your industry to help you; this is an investment, not an expense.
BASE offers a free one-hour consultation for any small to medium sized business with full confidentiality.  Simply contact us via email or through our website.
www.baserev.com

WHAT JOB IS THE CUSTOMER HIRING US TO DO?

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As companies grow (or sometimes simply age) it becomes increasingly difficult for them to adapt to market changes.  Many times they look inward, trying to shave another dollar or two from the cost of the product, while completely missing the chance to improve it.  They lose sight of just what their customers are hiring them to do.  A great example is the railroad industry.  These large companies had the steel contracts, the factories, and the personnel to dominate automotive and aviation – yet they thought they were in the railroad industry, when in fact they were in the transportation industry.  Now, with few exceptions – they are a distant memory for so many.

The Health and Fitness Industry has experienced a similar disruption.  So many operators thought they were in the business of providing a box with equipment in it, for people to pay to come and use.  Bigger and bigger boxes with more amenities, no true sales or customer service training, and ever changing pricing.  Once you get the accountants and operations strategists tinkering with the sales model, it’s pretty much over.  All the data analysis in the world, designed for people to present at board meetings, means absolutely zero when you’re trying to get two people on board – your employee and your customer.

How else did the Low Cost and Boutique models take the industry by such shock and surprise?  Our customers were hiring us to give them an innovative, quality exercise experience, and were given boxes in return.  Now many have gone in two different directions, either paying a cut rate for no service at an uninspiring location, or paying triple the amount for the boutique experience.  Simply putting a company logo in front of a knock-off activity and calling it a boutique is not going to fool anyone; there must be hands on management and a change of philosophy, which includes listening to your instructors when they tell you what your members are asking for.  Otherwise, you’re just the next New Coke…………

Contact BASE for a discussion of your business needs.  We are not simply a consulting company – we are a management company that owns its decisions.  On-site implementation and staff training are just two of the many ways we differ from data analysts and consultants.

This was supposed to be fun, wasn’t it?

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What drew you to the business you’re in?  Why did you choose it?

I’m guessing you weren’t forced into it…… you thought it would be a great industry to be in, and envisioned being able to make a living and provide for yourself and your family while enjoying what you do.  Then something changed for so many of you – it got really hard, and a lot less fun.

Maybe competition moved in and took away many of your customers.  Perhaps it was successful at first, leading you to open more locations, but scalability problems now have you running around trying to keep all the plates spinning.  Monthly billing is falling, payroll is out of control, attrition and staff turnover are climbing, and profit is sinking while stress is at an all time high.  You can feel trapped, unsure whether to just sell and try to cut your losses or stick with it and hope for things to get better.

Or you can get help.

Most people wouldn’t dream of buying a pair of golf clubs, heading to a course and trying to play without any instruction.  This is one of the few industries I know of where so many operators have no formal training in the business.  Perhaps they knew what worked when they started, but were so busy working in their own business that they didn’t have time to keep up with the trends in the market.  Our egos prevent us from asking for help, or trusting someone to take an objective look and offer advice – yet we sell personal training, telling our customers they need an expert to achieve their goals.

The reticence to try new things and hire experts is not as common in other industries, and it may well lead you to falling further behind financially.  Get help – maybe not from us, but from someone you can research, check references on, and speak to directly versus just reading a blog post or article.  You need something tailored to your particular situation.

This can be fun again.

BASE is pleased to announce our relationship with InTouch, providing advice, analysis and a free consultation to those looking to more fully understand their reporting and systems.  InTouch is the best way to ensure you are tracking the proper metrics to be successful – contact them today

Are Your Goals Hampering Your Success?

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Consider this situation:

Your boss issues you a challenge and offers you a bonus of $1,000 if you can beat him/her in a footrace across the parking lot – about 100 meters.  Most of us would take this up in a heartbeat.  It looks achievable, even if your boss is a runner – it is certainly worth running as fast as you can in hopes of winning.  Now let’s look at it a different way – your boss offers you a $1,000 bonus if you can run that distance in 9 seconds or less………

You would not even bother to change clothes or warm up, knowing that the bonus is impossible to earn.  What is the point of trying for a goal that you know is physically impossible for you to achieve? Likewise, setting goals based on ego or hope is an impediment to your staff, and therefore your business  success.    Do you know what you can and should expect from each revenue source, and the metrics that drive these revenues?  How are you coming up with these numbers?  Are you quantifying each important category to ensure that you have the accurate information to project performance?

Another  common mistake is setting goals that are too vague or abstract.  Simply stating that “we need to increase our EFT draft”, or “do better on retention” does not make it happen.  Setting the bar requires systems and procedures in place that measure success in these and the myriad of other categories that determine our overall business performance.  If the bar is set too high, no one will believe they are achievable.  If set so low as to be able to “step over it”, you will not only diminish your performance and waste payroll (bonuses on poor performance, etc.), but you end up spoiling your staff and creating a culture of mediocrity.

As we approach the fourth quarter, it is time once again to review our performance year to date, set a plan for the coming three months based on where we are short for 2016, and establish a budget and plan for the year 2017. Understanding how each and every department relates to one another and what your business is capable of achieving is the key to successful goal setting.  Without this information, setting goals can actually diminish performance.

We have 3 months left to work toward the success of our year.  Take a long, hard look at all the metrics that govern your success. If you are unsure what they are or how you are performing, get help.  Only then will you be able to objectively gauge your final quarter and set up a successful plan for 2017.