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Authors: Eliyahu M. Goldratt

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BOOK: It's Not Luck
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I stand up and take our cups for a refill. “Don, in our negative branch, where do we switch from positive to negative? The injection is positive. Successfully launching a new product is positive. The next step, investing time and money, is negative. Here is where we have to concentrate. What is the assumption under the connecting arrow?”

“Alex,” Don clears his throat, “we are assuming that the new product is actually new.”

“What do you mean?”

“Maybe the new product is just the old one with small modifications? Then the company doesn’t have to invest a lot of money and time. No, this is not a flying pig, it’s realistic. Take Pete’s solution as an example. He made minimal changes in his offering, and it didn’t require any investment or time to implement.”

“Yeah, good idea. Let’s put it back into our Future Reality Tree.”

“How?”

“Here, take your cup,” I hand him his coffee and flip back the page. “We have a new injection, ‘The company introduces small changes that sufficiently increase the perception of value the market has for the company’s products.” And I post it at the bottom of the page. “Now our original flying pig is not an injection but a derivative.

“See, if ‘The company introduces small changes that sufficiently increase the perception of value the market has for the company’s products,’ then ‘The company takes actions that sufficiently increase the perception of value the market has for the company’s products.’ ”

“I must admit that our new injection is more down to earth. But we still don’t have a clue where to look for the small changes that will make a difference. Our new injection still has wings,” he says flatly.

“Which we’ll have to trim.” I’m not losing my optimism.

“How?” Don is discouraged. “I don’t see even a negative branch that we can write.”

“When all else fails, read the Current Reality Tree again,” I’m quoting Jonah. “If there is a clue that can pave the way, it is there.”

Don is beyond arguing.

We read the tree, again. To my surprise I do find a clue. Right at the bottom.

“Listen to this, Don. ‘Market perception of value is in accordance with the benefits of having the product.’ ” I write it on a post-it and stick it near the bottom injection.

“I don’t see the relevancy.”

I ignore him. Now, at last we’re getting somewhere. “If, ‘The company introduces small changes that sufficiently increase the perception of value the market has for the company’s products,’ and ‘Market perception of value is in accordance with the benefits of having the product,’ then, ‘It’s apparent that the small changes the company introduces bring high benefits to its market.’ Come on Don, what are the things that bring benefits? What additional benefits did Pete’s solution bring?”

“You said it. Pete’s solution brought a solution.”

For a second I don’t get it. Then I realize how perceptive Don’s remark is. “You are absolutely right. Pete’s solution was not just a solution for his company, it was a solution for the dilemma of his clients. How can we generalize it?”

“No sweat,” he says, and starts to write, erase, move post-its around, and write again, until finally he posts the following statement: “A product that relieves prospects’ problems brings benefits—the more and bigger the problems that it relieves, the greater the benefits.”

“Very nice,” I fully agree.

“If we accept it and we accepted that ‘It’s apparent that the small changes the company introduces bring high benefits to its market’ then the unavoidable conclusion is that ‘The small changes the company introduces are those that relieve many of its market (prospects’) problems—the more problems relieved the better.’ Alex, it’s close, but I still don’t know what we can do with it.”

“What are you talking about? We have made it. We grounded our pig!” I jump out of my chair. “Don’t you see?”

He doesn’t. Not yet.

“Don, what is more effective, to address a symptom or its cause?”

“What is this? Trivial Pursuit? Of course addressing the cause is more effective than addressing the symptom.”

“What is more effective,” I continue to ask, “to address the cause of one problem, or the cause of many problems?”

Don starts to smile. “The cause of many problems. And how can we find the cause of many problems of the market? We know. Oh yes, we know. What a simple solution. How come we didn’t see it before? It’s so obvious. If we want a marketing solution for our company we shouldn’t analyze our company, we should analyze the company’s market. The solution to marketing is in the market. So simple. So obvious.”

“Yes,” I join in. “Everybody knows their UDEs, but very few know their core problem. If we want to bring a lot of benefits to the market we’d better address its core problem, not the symptoms, as everybody else is doing. And we are in a unique position to do it. We have the perfect tool for it, the Current Reality Tree.”

Don stands up, and we shake hands.

“Alex, I must tell you that I didn’t believe that anything would come out of your starting point. In my eyes it wasn’t a flying pig, it was a flying whale. But now, now it’s a different ball game.”

“Come on Don. Let’s rewrite the Future Reality Tree. This time starting with a tangible injection. Let’s see where it will lead.”

Don posts the new injection, “A Current Reality Tree on the company’s market is constructed.” “I bet this injection will trim the wings of all our original injections. They will no longer be dreams. I’m sure that they will turn into derivatives.”

“Let’s see.” I encourage him to continue. He is right. Maybe we’ll need some more injections, but we are over the hump. No more flying pigs.

“Okay. Now let me add that ‘A Current Reality Tree is a very effective way to connect problems, UDEs, to their origin.’ The derivative is that ‘The company can determine which are the deep causes in the Current Reality Tree that can be removed by the company’s type of offering.’ Alex, wait a minute. How do we know that there will be a deep cause that the company’s offering has anything to do with?”

“We know, Don. It’s okay. In any realistic case the market has more than one UDE that relates to the vendor. Not just due to its product but also due to its service, financial terms, et cetera.”

“I see,” he agrees. “And since there is more than one UDE that stems from us, we’re bound to reveal a deep cause that we can handle. That’s beautiful. It means that we will not have any problem identifying what are the small changes we have to implement in order to bring high benefits to our clients. Let me add it to the tree. It will turn our original injection into a mere derivative.”

I agree that we’re bound to reveal a deep cause that we can handle. I pray that we can handle them with only small changes. Probably that’s the case, since there are so many UDE’s that stem from our service.

As he does it, I’m concentrating on the next injection. How can we guarantee that the market perception of value for our products will be higher than for our competitors?

To my surprise I realize that no additional injection is needed. The market has several existing UDE’s that relate to our type of product (including the way it is currently offered). This means that currently no one is successfully addressing the core problem responsible for these UDEs. If we do it, the market is bound to have a higher perception for our products. No sweat.

I know that for the markets of each of my companies these UDE’s are not small. Relieving all of these UDEs will be highly beneficial. We are going to get a dominant competitive edge.

When Don finishes, I go to the flip-chart and post in the appropriate statements and arrows. When I finish, the injection, “The perception of value the market has for the company’s products is higher than the perception it has for the competitors’ products,” is no longer an injection. It’s a derivative, a result.

“I see why you insisted on writing the Future Reality Tree even though it was a pie-in-the-sky,” Don is beaming. “Now it provides us with a clear map. We know exactly what we have to address.”

“So let’s address it. What is the next injection we have to connect to?”

“ ‘The actions the company takes are difficult to follow by its competitors,’ ” he reads from the board. “How can we guarantee that the competitors will have trouble copying our offering?”

We continued the process, hammering out every detail and building a rigorous map for Bob and Stacey to follow.

21

 

I half sit, half lie in front of the TV, barely watching the news. It was an exhausting day, especially with the bomb Pete laid on me just before the day ended. It’s a big problem. And if it’s not solved immediately, everything might collapse.

Stacey’s company will be sold to the shredders, Pete and Bob’s companies will be sold for peanuts, and before long they too will be destroyed. And me? I’ll be thrown out, disgracefully, into the street. Trumann and Doughty will guarantee it. Everything depends on a quick solution to this unexpected problem. Well, not exactly unexpected. I suspected it right from the start, but who could have anticipated it would be so severe?

Why is it that exactly when everything seems to be under control, reality proves that it isn’t? If there is one thing I can’t complain about, it is living a dull life. Some excitement is fine, but this roller coaster I’m on is a little too much.

The worst thing about it is that I personally cannot do a thing. My hands are tied. The only thing I can do is sit tight and wait for Pete and Don to straighten out the mess. One thing more nerve-wracking than being a warrior is being the one waiting behind the lines for the warriors to win.

Do I have a real reason for my concerns? It all started at four this afternoon, when Fran passed me a call from Pete.

“Alex, I think I’m running into a little problem.” Knowing Pete’s British heritage, I suspect a big problem. “What is it?” I calmly ask. “My people are unable to sell our new offer,” he says without emotion.

“How come?” I am sincerely surprised. “According to your reports, you have closed three more deals in the past two weeks.”

“Yes, Alex. That’s the problem. I have closed them, not my people. My people have succeeded in closing nothing so far. Not that they haven’t tried. They have. By now they are so desperate that they refuse to try anymore. I am afraid we’ll have to revise the forecast back down.”

“Wait, Pete, not so quickly. Tell me more.”

“There is nothing more to tell,” Pete sounds down. “I just finished a sales meeting. Each one of our salespeople has tried to sell it and has failed. They claim that our offer is too complicated, and that the buyers don’t understand it. My VP of sales is leading the rebellion. He has tried it four times, with four hot prospects. Now he’s convinced that it is unsellable.”

“How many times have you tried it?” I ask.

“Five.”

“And?”

“And we have five nice contracts. But that’s not the point. I can’t be the only salesperson in my company. And I can’t push them anymore.”

“Wait,” I say. “Let me think.”

After a minute of silence, I ask, “Pete, did you find the idea hard to sell?”

“No, not at all. That’s what baffles me.”

“Did you tell your people exactly how you do it?”

“Of course I did. I even wrote the whole procedure down. They swear that they have followed my instructions to the dot. I don’t know what’s going on.”

It’s a long time since I’ve heard Pete sound so desperate. They must have hit him badly in the sales meeting. “So your people are claiming that you devised an offer that only you can sell?”

“Correct.”

“That you are a super salesman, but a company’s offer should be good enough to be sold by mere mortals?”

“That’s what they claim, word for word. Alex, almost half of their compensation is based on commissions. I must do something, and fast.”

“Pete, stay cool,” I try to calm him down. “Since we both know that you are not a super salesman, it must be that the offer is good, and salable.”

He laughs nervously, “That’s what I was trying to tell them. But they won’t listen. Not anymore that is.”

“If there is one thing I have learned in my life,” I tell him, “it’s that in reality there are no contradictions. There is always a simple explanation, and the only simple explanation I can see is that in spite of what your people are telling you, they aren’t presenting it the same way you are. They must be deviating in some way, and their deviations are fatal.”

“Makes sense,” Pete replies, “but probably I’m too close to the situation. Last time I went with my VP of sales to a meeting, I swore to myself that I would not open my mouth, I would just observe. After three minutes, I took over. We got a sale, but my VP of sales became even more disenchanted. That is probably when I lost him. Listen, Alex, what I really want from you is that you’ll send Don to help me.”

“What do you mean?” I am not entirely surprised.

“I want him to accompany my salespeople on some sales calls. He is not as emotional as I am about the offer; he won’t have any problem watching them butcher the sale without interfering. At the same time, he knows the logic of our offer inside and out. Maybe he can put his finger on what they are doing wrong.”

BOOK: It's Not Luck
11.76Mb size Format: txt, pdf, ePub
ads

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