The following post is courtesy of Diane Harrison who is principal and owner of Panegyric Marketing, a strategic marketing communications firm founded in 2002 specializing in alternative assets.
Human error is a given, and no one is immune to making some poor choices in work and life somewhere along the way. But among the inevitable errors there are other mistakes that are totally avoidable, given the right circumstances and a proper mindset. In the community of alternatives, managers and service providers can reduce their error experience if they keep an open mind and a flexible approach to problem-solving.
KNOWING WHEN YOU DON’T KNOW BETTER
After decades of working with all types of investment managers, third party service providers, and other alternative assets professionals in helping form their marketing strategy and sales approach, I’ve identified several common behaviors that often trip up these clients. These four examples cross both the buy and sell sides, and lead to roadblocks in business growth. See if you recognize yourself in any of the following scenarios.
ONE: Failing to understand inherently the value your business offers by focusing on what you do rather than what it represents to the recipient.
A first step in any marketing build out or rebrand is defining the value proposition of a business. A value proposition is commonly recognized as a clear statement explaining what you offer (product or service), to whom (target market), and what value it provides to your market better than what is already out there. It sounds like a simple exercise for a business owner to jot down over the first cup of coffee in the morning, right? That’s what most owners believe, yet a majority of them either don’t have a clearly articulated statement or it doesn’t fulfill the definition of a value proposition as stated above.
What these owners typically offer up is a laundry list of attributes about their product or service—what it does and all its features or details of how it works— but lacking the essential components of who benefits from it and why the business is different from its competitors in bringing value to its clients. The following graphic helps rate the relative strength of such statements on a scale of 0-5, with zero being minimally useful to 5 being most effective:
It can’t be stressed enough how important it is for every business to communicate what it does, for whom and why that matters. If the business owner can’t explain their value proposition, how are clients supposed to get it? Every business owner should prioritize strengthening this critical element of their marketing communication platform.
TWO: Talking at your prospects and clients rather than with them while believing that your expertise is the primary reason clients engage you.
This is a common marketing pitfall both managers and service providers often feel comfortable pointing out in others, but cannot see in themselves. Who hasn’t sat through meetings in which someone is trying to sell you something that they just know you can’t resist, but never actually ask what you think or feel about whatever the product or service is and how it will help you? You hear all about what their analysis of the strengths is and the benefits it brings, but there’s an odd failure to link those advantages to the individual situation of the prospect and what that potentially means to their experience.
A tip to help you reverse the ratio of talking at versus conversing with your prospects is learning to use the ‘significant pause’ effectively. People who interview others on a regular basis know that if you want to elicit more information from someone, stay silent for a few additional beats after they have stopping talking in response to a question from you. Rather than jump in to validate what they’ve just said, or to ask a follow up question, stay quiet and give them additional time to add to their reply. It works more often than not, and generally leads to valid information you hadn’t anticipated.
Another technique to gain more of a conversational dialogue with a prospect is to practice deciphering what their essential pain point is and restate their problem issue in a way that shows you fully heard what they shared and you are empathizing with the issue it presents. Prospects are more likely to develop an alliance with you as you discuss how the issue might be solved with the offered product or service solution.
THREE: Maintaining a stubborn lack of openness to receiving and incorporating an outside perspective in your business approach.
The introvert manager, or Hermit with a Plan, is another common communication problem. Some managers who have built their business to a certain point on the strength of their innovative ideas brought to life reach an impasse where they find it difficult to bring on additional forces to help break through to the next level. They know they need to add more skills or a new growth strategy to take them higher in the business lifecycle, but they find it very difficult to share proprietary information or incorporate outside ideas into a master development plan.
You see this dilemma in action when founders attempt to hire second level lieutenants, internally or as third party providers, to build and execute a new strategy and then undermine them with a refusal to provide support and delegation powers to make the plan successful. Not only does this prevent the business from moving forward, but it also negatively impacts the morale of the staff, which sees confusion and poor management in place of solid executive leadership.
FOUR: Failing to address a true weakness directly by seeking to avoid the topic entirely.
I saved this for last, as I find it the most common pitfall among businesses in general. Every firm has strengths and weaknesses, even those that are the leaders in their field. The strongest of companies encourage employees and customers to bring inherent weaknesses to the attention of management, so that such deficiencies can be addressed and hopefully eliminated. They are in a constant information feedback loop to gather such important data and work on ways to improve operations at every level of their business.
Unfortunately, most companies don’t actively follow this path. Rather, they are eager to tout all that they do well, and how that benefits their clientele, but remain stubbornly mum about discussing the areas in which they should improve, bringing better product or service to the market going forward. The environment internally does not typically make it easy or advantageous for employees to raise such weak points to management, so that they can be addressed and dealt with proactively. Such issues are always known to all, but they become more of an ‘emperor’s new clothes’ issue, where no one wants to be the first to point out the obvious. This type of behavior does little to encourage problem-solving for the types of issues that highlight a real business weakness until the problem becomes large enough to bypass such practiced ignorance.
These four examples are related in their contribution to blocking business growth. All share a common practice of failing to look inward first to improve practices and behaviors that keep one from achieving more. Getting comfortable in identifying what’s wrong inside before focusing on all that happens outside is the first step in reducing the behaviors that can hold a business back.