If You Build It, They Still May Not Come, Even Though They Should

I came across a really cool new product last week that I wanted to share for two reasons. One it is a really cool (ok I said that) and two, I think there is a marketing lesson in this product. 

The product is the BIC Duo. It is a ball pen and highlighter in one product. Wait, before you say, “been there seen that.” Not like this one you haven’t. The pen and the highlighter are on the same end of the pen. In other words, no flipping the pen over to write with one side and then the other, and it is very stylish. If you use highlighters and pens, you should check it out. 

Now, what is the marketing lesson? Well, I assume you have not heard of this product. I hadn’t and nobody I have talked with has either. It is relatively new. It was launched in the U.S. last year. However, it did not get much (any?) fanfare. Well to be fair, it did get voted product of the year by Reader’s Digest and it got a mention on the Today Show and Fox & Friends. I think the reason it did not get as much traction as it should have is because the company behind it, BIC, generally makes great, incrementally innovative products.  

That is, the vast majority of their products are incremental innovations on existing products. They are noteworthy by their quality, consistency, and improvement over existing solutions. BIC, for the most part, does not try to create significant innovations. Well, the Duo is. So why didn’t they shout it from the roof tops? 

I don’t know, but I suspect this is an example of what happens in most companies. We have processes designed to support the businesses we are in. If we come up with something outside that box, we do not have the processes in place to deal with that, or the ability to understand, as well as we should, that there may be something different necessary to get to a different place. 

Is this a problem? Often, but not necessarily. I believe BIC will eventually get traction with this product, it is just really cool (ok, I keep saying that) and they appear to have patents pending on it, so others will be precluded from a quick copy. Could they have accelerated the acceptance curve? Maybe, it depends on whether others find it as compelling as I do (it’s in my pocket now, having replaced my Mont Blanc). And even then, not necessarily within the budget or process they normally use. Could they have found a way around that?  

Again, probably. And maybe they are up to something as we speak. Or they may be having retailer acceptance issues. We all know that retailers have a lot of clout these days as to what gets placement in a plan-o-gram and maybe BIC has not been able to persuade enough retailers to give it the “shelf space” it deserves. They don’t invite me to their marketing meetings, so I don’t know. But they could certainly use viral methods like YouTube or other similar techniques to get the word out without needing a Super Bowl ad (or budget). 

Anyway great product and useful lesson for us all.

Why is US Airways the worst US Airline?

First, let’s get clear on the ranking. Consumer Reports reported in their June issue that a survey of their readers (over 30,000 respondents) ranked US Airways as the worst US Airline. Now, the question is how do they earn that distinction? 

Well, I don’t know for sure because in my experience as a VERY frequent flyer, most of the airlines treat their non-frequent flyers pretty poorly. My comment is that airlines (for the most part) operate as if passengers were an inconvenience to the efficient movement of airplanes.  

Some are different. Southwest appears to treat everyone the same virtually all the time. They rank pretty high in customer satisfaction and if what they do works for you, they are a good, consistent choice. Jet Blue, ranked #1 by Consumer Reports and JD Powers, appears to have a staff with a different attitude. I don’t fly them enough to comment, but I believe I can tell you a bit about why US Airways is ranked dead last. Their employees don’t appear to care. Don’t know why, probably because of how they are staffed and managed, but the result is the same. 

For the first time in 20 years I missed a client engagement because I could not work around the airlines poor execution. To be fair, the fundamental problem was created by United Airlines, but the true customer service failure was at US Airways. I’ll tell you a shortened version of the story so you aren’t reading a novel. 

I had to get to Pittsburgh yesterday. Had reservations on United from San Jose to Denver, and Denver to Pittsburgh. The San Jose flight was 2 hours late so I was going to miss the last connection to Pittsburgh. The United 1K desk (see I do fly a lot) offered to route me on the red-eye from SFO to Pittsburgh (operated by US Airways). While that was not optimal it allowed me to make my client commitment. I agreed. 

United sent me an email as promised with my new itinerary showing the US Airways flight from SFO to Pittsburgh. I arrived at SFO 10 hours later and a bit over one hour before my flight so I could check in. The kiosk would not check me in. I stood in line to talk to the (yes “the” not “one of the”) counter agent. Forty minutes before flight time I connected with her. She confirmed I had a seat on the flight (an aisle seat even though when I had called earlier in the day I was told they only had middles left, but whose going to complain about that good luck). She then asked for my “ticket.” What ticket?, I asked, I’m on an electronic ticket. 

She pointed out that was a United ticket and she needed a US Airways ticket. Knowing the lingo, I asked her if United had “pushed” the ticket to US Airways as they should have. She said, we don’t “push” tickets anymore. (So much for knowing the lingo.) She asked for my ticket # which I did not have. (It appears on your ticket, if you have one, but then if I had a ticket, this would have been moot.)

I immediately called United to get my ticket #. They gave it to me and the agent told me that since that ticket was from San Jose to Pittsburgh it would have to be reissued. I said go ahead. She said only United could do that. (Why they had not done so previously is the root cause of this problem, but that was human error, which we all suffer from.) 

I then asked the 1K desk person to help re-issue the ticket (now 30 minutes before flight time). She said a supervisor would have to do it and she would get on it. I am now on hold with United. In the mean time, I asked the US Airways agent if I could just buy a one-way ticket on her flight to Pittsburgh. She said the flight was oversold and she could not do that. (Odd since I had an assigned seat on the flight, and I just wanted to pay for it again.) I was too stunned to deal with that one, so I waited for United to get back on the line. 

25 minutes before flight time, still no word from United. The agent then considers giving me my boarding pass to get through security and having me get the ticket piece at the gate once United had finished with the transfer. Then she realized that would not work. Why you might ask? And I quote her, “Gate agents don’t like to deal with that kind of stuff.” So, getting to the gate was no longer an option. 

About this time (20 minutes before flight) she denied boarding to two other people who had been in line for 15 minutes and missed the baggage cut off time. Knowing that two seats had now freed up on her flight, I asked again if I could buy a seat. She said no, it was now too late to sell me one even though there were empty seats on the plane. (It’s not clear to me it was ever over-sold.) 

At 15 minutes I determined I could no longer make the flight and gave up. About 10 minutes later United did get my ticket over to US Airways, so they now have to move it back to get me my refund. 

The plane left on time, with empty seats and a passenger who has time today to blog about this and be reminded once again that passengers are an inconvenience to the efficient movement of airplanes. The fact that a lack of passengers in the earlier part of this decade cost thousands of airline jobs does not seem to connect for the employees of most airlines when dealing with each of us as single passengers.

Mitch

Distinction vs. Differentiation

I had an interesting discussion last week with an audience member who felt that differentiation was not what customers wanted to buy. We were discussing one of my favorite subjects, which is Marketing’s core responsibility for identifying what we call a What. That is What can customers buy from your firm they cannot buy (or at least don’t feel they can buy) from anyone else.

His position was that you had to have a distinction to get customer’s attention. He argued that being different was not what was needed, but rather being distinctive was. While I agree that being distinctive is important to getting attention, a distinction without a difference will not result in sustainable customer purchase.

You might suggest that a distinction implies a difference. Intellectually you may be correct, but we have all seen people make major distinctions that did not constitute much of an actual difference.

I like the word distinction, and language can be important, especially when communicating. I looked up the word distinction and found that for all practical purposes, the word distinction is a direct synonym for the word different. However, in looking further into the definition, I found that the word distinction can also be defined as “marked superiority.”

Where does that leave me? A perceived, valuable difference is what is important in keeping your product or service from becoming a commodity. Does that make it distinctive? Indeed. Is being distinctive sufficient? Does it imply a valuable difference? Good question. The dictionary definition is not sufficient to tell us. What do you think?

My co-author of our book and on this blog, Ralph Mroz, loves the expression “that is a distinction without a difference.” Which might be the whole point of my “discussion” with this audience member. But, then I leave that for you to decide.

Mitch

One more on process vs. innovation

I have just a bit more to say on this process vs. innovation issue, and then I’ll move on. (I have some thoughts on the Intel “comeback” reported by Forbes in their June 4th issue that I will be posting in the next few days.

While most of the Business Week article is very good, it tends to misunderstand the application of process management to business activities. Like many others, the author and maybe even some of the experts quoted are stuck in a paradigm that process management implies rigidity. That is true when it should be, but is not a fundamental tenet of process management. 6-Sigma is based on eliminating variation in processes. If that is what is needed, then 6-Sigma is the right tool. However, all processes do not demand variation minimization as a fundamental goal.

1. Process excellence demands precision, consistency, and repetition. This is flat out not true. Repetitive processes demand those things. Adaptable processes require adaptability. The output of some processes should be precision and consistency. Other processes, the creative process for example, are not looking for precision or consistency, but may desire repeatability. The above statement is an unfortunate example of the misunderstanding of the purpose of using business process to manage activities.

2. The more you hardwire a company to total quality management, the more it is going to hurt breakthrough innovation. Hard to argue with that statement (especially since it was made by a management professor from the Tuck School). However, why do you need to hardwire every functional area within your company to one mindless focus? On what basis would a competent executive decide that a properly managed company should have only one management tool to use to improve performance.

3. Tom Davenport a management professor at Babson College is quoted as saying, “Process management is a good thing but it has to be leavened a bit with a focus on innovation and [customer relationships. Again, we have an example of someone stating that process management implies rigidity, precision, consistency, etc. This is a myopic and incorrect view of what process management done correctly really means.

4. Process management has no place in growing the top line. That requires innovation and/or acquisition. That’s just not true on its face. To continue to believe that innovation, marketing and sales (all of which drive the top line) cannot be improved with appropriate business process improvement methods is short-sided, ignorant, and competitively limiting.

Mitch

Process vs. Innovation

Many pundits argue that the current path to competitive advantage is by out-innovating the competition. This is as opposed to focusing on being more efficient than the competition. The unstated theory being that one of these two approaches is the strategy of success. A cursory review of business history shows that these two pendulum end-points are touted as the “secret to success” as the pendulum swings over time.

Since the pendulum has moved back to innovation, commentators are now discussing whether 6-Sigma or business process management is compatible with innovation success. (The fact that the two terms 6-Sigma and business process management are considered interchangeable is its own problem, that I’ll get back to later, either in this post or another, depending on how long this one turns out to be).

What got me going on this was an article in the June 11, 2007 issue of Business Week on 3M’s innovation crisis. I had wondered what had gone on with 3M the last several years as they didn’t seem to be their innovative self. However, like most of us, while I was curious, I didn’t get around to looking into it. So, I was glad to see that Business Week was going to “catch me up.” They did, but they also tipped me over on one of our pet peeves.

The gist of the article is that a former GE executive, James McNerney, hired by 3M as the first outside CEO, ruined 3M’s innovation engine by blindly applying 6-Sigma (or process, they go back and forth on this as if the two were the same thing, but again, I digress) everywhere including in innovation, where it cannot work. The result is a company whose innovation engine has stalled to the point where rather than 1/3 of sales coming from new products; that number has dropped to 25%. Although profits have been up substantially, there is a belief that this could not be sustained as the new product engine slowed down. Fortunately (or presciently), McNerney found another job running Boeing, so he won’t be around to live with whatever crop he sewed.

Anyway, what tipped me over was the theme of the article on the relentless focus of process management and/or 6-Sigma to everything. Especially to innovation and the resulting destruction of 3M’s innovation engine. The implication being that process management and/or 6-Sigma has no business in innovation because it will kill innovation. That’s just not true … provably.

But I guess to convince you I will have to deal with the process management/6-Sigma misconception. 6-Sigma is a tool. It is a set of methodologies designed to remove variation from processes. If process variation is a root cause problem of poor performance, than 6-Sigma is an appropriate tool. If process variation is not a root cause problem of poor performance, than 6-Sigma is probably not the right tool.

Unfortunately, like other methods before it such as re-engineering, 6-Sigma has been redefined by consultants and some executives to mean process improvement management. It is a useful method for improving processes where limiting variation is an important goal. It is not useful in many other process improvement projects. However, as the old saying goes, when the only tool you have is a hammer, everything looks like a nail. Using the 6-Sigma “hammer” on the front-end of the innovation process is unlikely to help anything … except consultant’s billing rates.

The creative front-end of the innovation cycle is not about reducing variation, it’s about exploration. One former 3Mer summed it up this way, “… there is no way in the world that anything like a Post-it Note would ever emerge from [a 6 Sigma] system.” To which I say, why would you expect it to? 6-Sigma is about reducing variation in processes not coming up with breakthrough products. Who on earth would think it is a good idea to apply 6-Sigma to creativity? Oops, I guess a well-regarded former GE executive, so what do I know?

Does that mean that 6-Sigma or process improvement management has no place in the innovation process? Of course not. First of all 6-Sigma is a process improvement management method and it may be useful on the back-end of innovation where you are moving the product into initial production and market launch. I can make a substantial case that reducing the variations in getting new products into production and into the market are critical needs. And to blindly suggest that process improvement management is not right for innovation is just ignorant.

Rigid processes don’t work well in flexible-need environments. However, to suggest that process management doesn’t add value in adaptable environments is misguided. If you ever have the unfortunate need to be in a trauma center, you better hope they have a work process that will save your life and that that process is adaptable in case what they originally think they are dealing with is not actually the issue.

Every process is perfectly constructed to achieve the results it is achieving. If you are not getting the results you want from your innovations, you need a better process. The fact that 6-Sigma may not be the right tool to improve the process does not imply that it is not a process and that business process management methods can’t be used to get improved results.

Mitch