Friday, May 30, 2014

Competing with the For-profits

By Steven Worth

These days, there is hardly a sector where for-profit organizations have not made in-roads into areas that were once the exclusive domain of nonprofit organizations. Whether it is in supplying blood to US hospitals or offering the public for-profit alternatives to nonprofit and government sponsored schools, for-profit organizations are often beating nonprofits at their own game by providing more creative, effective and efficient alternatives. If you don't see this happening then you should look again; it is not a pretty sight.

So what is a nonprofit organization to do?

As management consultants dedicated to helping nonprofit and public service organizations become more efficient and effective, it is bracing and encouraging to see increasing numbers of well-trained, dynamic managers of associations, professional societies and philanthropic organizations employing technology and management techniques that used to be the exclusive domain of for-profit companies. As a result, their organizations are becoming every bit as efficient and effective as the best practices in their respective sectors-even while they remain faithful to their mission-driven purposes upon which their nonprofit organizations were founded.

In this race to be competitive it seems to me that it is critical nonprofits not lose sight of their innate competitive advantages over for-profit corporations:

* Energized members and customers: Mission-driven nonprofit organizations are successful in attracting armies of dedicated volunteer talent from recent graduates to recent retirees (and everyone in between) precisely because they do appeal to the human need to serve a purpose greater than ourselves.

* Doing Good: Corporations too are buying into the idea that it is good business to do good. While advertising and sponsorships have been in decline since the beginning of the Great Recession, Corporate Social Responsibility (CSR) has taken off. Many times these CSR projects are in partnership with nonprofit organizations whose missions and visions (not to mention their credibility and credentials) dovetail with what these corporations want to do.

* Sense of Community: Communities of people sharing common interest--for-profit companies don't provide this; nonprofits do. We are social animals and like to share our time and talents and thoughts with people who share our interests and concerns on-line or in-person. This is the trait or characteristic that always finishes at the top of the list when membership organizations poll their members about what they value most. This is the sticky soft power of nonprofit organizations that no for profit can match.

We love seeing nonprofits producing fact-based business plans that provide measurable performance indexes and bottom line impact analyses.... But don't forget your heart, your energized members and customers, your goal for doing good and your important sense of community.

Friday, May 23, 2014

The four strategic uses of research

By Steve Worth

On more than one occasion I have heard association executives say that they saw no need to do market research because their membership included the who’s who of their sector. 

It seems to me this is a dangerously myopic mindset; but at the very least it misses four key uses for market research:

1.      Achieving consensus—Any association executive will tell you that one of the hardest aspects of their job is to harness the many strong personalities represented on their board of directors and various leadership bodies.  It can be as hard as herding cats; but facts have a way of focusing attention on what is important while minimizing personality differences and/or the differences among membership factions.

2.      Bringing stakeholders’ voices to the table—Every organization has important stakeholders who cannot always be present when and where decisions are being made.  Stakeholder research can help compensate for that and make for a more inclusive and transparent decision making process.

3.      Benchmarking progress against goals—It is a truism that people and organizations achieve what they measure.  Start tracking your progress on key goals and see for yourself how obstacles magically melt away.

4.      Trend analysis—One of the key legal advantages nonprofit organizations have over for-profit companies lies in their ability to collect and analyze competitive data.  It is also one of the most valued benefits as measured by surveys in virtually every membership organization.

There is nothing to compare with the strategic value of good market research—no matter who the members of your association might be!

Monday, May 19, 2014

BRICS, MINT--or what do you feel is the most promising place to invest?

By Steven Worth

What is your acronym of choice—BRICS (Brazil, Russia (well, let’s keep the “R” just as a place holder for now because the acronym sounds better with it), India, China, and South Africa); or MINT (Mexico, Indonesia, Nigeria, and Turkey)?  While these are neat acronyms and many of these countries do seem to be hot markets for international investors, there is growing evidence global businesses and investors in all sectors are looking at another acronym of a market that may not be ready to fade into the past just yet—USA.

I know, I know this sounds jingoistic but let’s look at the facts.

·         US demographics are sound when compared to the aging demographics of every other developed economy.  There will be no implosion of an overly burdened workforce trying to care for a much larger aging and retired population.
·         The comparative cost of labor along with productivity levels is so favorable now that manufacturers are bringing jobs back to the US after decades of offshoring.
·         The basic infrastructure that a national economy relies on are all in abundance: 
o   An educated workforce
o   Communications and transportation infrastructure
o   A culture in which the rule of law has unquestioned dominance and where political institutions despite all their flaws are stable and the envy of most developing economies
o   A sound currency with an ample supply of investment capital
o   Near self-sufficiency in all critical natural resources
o   Cutting edge technology and a market whose thought leaders regularly win the most Nobel Prizes
o   The largest and most sophisticated purchasing power of any market in the world
o   A middle class with enviable social mobility that attracts the best brains and talent from around the world
·         A secure geopolitical position by virtue of being located on a continent and in a hemisphere with friendly neighbors and with soft and hard power second to none

Our country’s weaknesses are perhaps more obvious to us sometimes in an election year than our strengths, but in light of these strengths our weaknesses should rather appear as opportunities.  If our education, healthcare, and transportation systems need to be repaired—those are opportunities that are right here in our own backyard where the grass is pretty darn green.   

Monday, May 12, 2014

Four assumptions—are we on the same page?

Steve Worth, President of Plexus Consulting, LLC

Fast growing associations of all kinds share these four leadership assumptions:

  • Growth is good—growth is part of the definition of life.  If you are not growing you are dying.
  • All business-related organizations should be market-focused—and markets change, that is what markets do; so strategies and tactics need to be assessed frequently in order to remain relevant.
  • Decisions should be based on solidly researched facts—fact-based decision making beats any of the alternatives!
  • Form follows function—once you have determined what needs to be done your organization’s operational and governance structures should be adapted to help achieve that end objective.

So simple yet so complicated for so many organizations.

Thursday, May 1, 2014

Six Differences Between Customer-Focused Companies and Operations-Focused Companies, Shep Hyken

Six Differences Between Customer-Focused Companies and Operations-Focused Companies

Six Differences Between Customer Focused Companies and Operations Focused Companies image CS Focused vs Ops Focused Low resBetter Customer Experience

Some companies really understand customer service. They know how to hire for it, train for it and deliver it. Other companies claim to give customer service, but in reality, they are grounded in an operations mentality with rules and policies that allow for little flexibility, preventing them from being anything more than just average or satisfactory. Here are a few observations of the differences between customer-focused companies versus operations-focused companies:

Empowerment: A customer-focused company empowers employees to make decisions that are for the benefit of the customer. They have guidelines versus rules and take the approach that if it isn’t illegal, immoral, won’t cost the company money (although sometimes that’s still okay), and won’t harm the company’s reputation, then consider doing it to take care of the customer. The operations-focused company requires a manager’s approval for anything that is outside of their policies or typical way of doing business.

Hiring: A customer-focused company hires people who fit the culture, which means they have the personalities and core-values that align with the company’s vision and mission. Certain jobs may require skill, but skill alone won’t get the applicant hired. An operations-focused company will hire for skill, filling a position with technical strengths. The applicant’s personality may or may not fit with the corporate culture.

Training: A customer-focused company spends time and money training for soft skills such as relationship building and customer service. The company recognizes that it takes both, technical and soft skills, to break away from being average. The operations-focused company spends most of their training dollars and time on technical skills and product knowledge.

Leadership: The leaders of a customer-focused company set the vision and mission of the culture, and then they lead by example. The leaders of an operations-focused company sets the vision and mission of the culture, but sometimes will have the “Do as I say, not as I do” approach. Sometimes their behavior is incongruent with what they want to achieve, often leaving the employees confused and less than motivated.

People First: The customer-focused company knows the importance of putting people first – specifically employees. They develop a culture of happy, engaged and fulfilled employees that deliver a better customer experience. Customers like this and continue to come back. An operations-focused company develops a culture focused on systems, procedures and the bottom line. While this is important to any company’s success, they miss the culture part of the equation.

Customer Service: The customer-focused company looks at customer service as a philosophy to be embraced by every employee of the company, recognizing that there are both external and internal customers. The operations-focused company sees customer service as a department.