Value Coming in Equals Value Going Out

by Tom Reilly     ©Copyright 2000

Is your dealership adding value to its relationship with customers? Here’s how to become a value added peak competitor.

For the past twenty years I’ve had the privilege of working with some of the best organizations in the world—global leaders in their industries. I was their student as well as their teacher. I learned from them as much as I taught them. One of the lessons they taught me was how to compete in an industry.

At the most fundamental level of competitiveness are the equalizers. They want to be as good as everyone else. They seek ways to close the gap between themselves and everyone else in the industry. Equalizers have a lot of catching up to do.

The next higher level of competitors are the differentiaters. They want to be better than the rest of the pack. They seek ways to expand the gap between themselves and everyone else in the industry.

The highest level competitor is the value added peak competitor. These organizations march to a different drumbeat. They are not focused on the gap between themselves and the competition, they concentrate instead on bridging the gap between potential and reality.

Value added peak competitors are those people and organizations who embrace and execute the value added philosophy. They expect the best from themselves, which enables them to maximize the value they bring to the table for their customers.

These are companies that have a positive addiction to excellence and a desperate curiosity about their potential. They have discovered that people—their employees—are their single, unique dimension of value.

Organizational excellence is the natural outcome of individual and team excellence. How employees approach their careers, interact with their peers, and engage customers affects the bottom line.

Becoming a value added organization is a top-down, bottom-up, and inside-out process. Everyone—I repeat—everyone in your company must buy in to this philosophy.

How to Approach Your Career

Whether you’re the CEO, vice president of sales, midlevel manager, customer service rep, factory worker, or salesperson; your performance affects your organization’s performance. Are you a cost center or a profit center to your company? Do you add value or cost to your company’s efforts? What are you doing to add value to your company?

Value added peak competitor employees seek ways to add value because that’s the way they live their lives. They naturally put forth extra effort. Excelling is a habit for them.

An effective way to add value is to identify impact areas where you can make a difference for the customer or for your company. Your behavior has a positive impact on your company’s performance and how you treat customers.

A few years ago I was in Sacramento working with an equipment dealer. I assembled a group of employees and asked them, “How do you personally add value?”

One of the mechanics said, “On every piece of equipment that I work on, I perform a five-point safety check just to make sure that everything that leaves my repair bay is safe for our customers to operate.”

One of the salespeople in the group heard this and asked, “Do you perform that test on everything?” The mechanic said, “Yeah.” And the salesman said, “I can sell that this afternoon.”

A customer service rep told me that every Monday morning she checks her backorder reports and gets updated shipping information. She contacts her customers and gives them the new information. She said, “When I contact them they call it service. When they call me it’s a complaint.”

A manager told me that he added value by the amount of time he spent face-to-face with customers. He could get things done. By having his ear that close to the ground he was able to prevent many of the fires that other companies had to fight.

A salesperson told me that she added value with her 24-hour accessibility to customers. She gave them her home phone number, beeper number, cell phone number, and inside contacts. She made sure that her customers were never out of touch.

An accounting person told me that she saw her role as building bridges with customers to bring them in, not walls to keep them out. She looked for ways to help customers qualify for credit rather than disqualify them.

A driver told me that he went the extra mile for the customer by adjusting his route to deliver when it was most convenient for the customer. He said, “I want to make it easy for our customers to receive our deliveries. Other drivers won’t do that.” This driver made it a habit to do what others viewed as a hassle.

If everyone in your organization asked this question daily, “What am I personally doing today to add value to our efforts?” you could lift your organization to the next level with your employees.

How You Interact With Your Peers

Everyone in the organization has a customer, either internal or external. External customers are the traditional customers who pay for your goods and services.

Internal customers are the employees in your company whom you serve. The service department is the internal customer of the parts department; customer service is the internal customer of the sales department; MIS serves marketing; employees serve management and vice versa; and human resources serves most other departments. Who are your internal customers?

There are two corollaries that follow this internal customer relationship. First, you can serve your external customers only to the degree to which you serve your internal customers. Second, everything you do to serve internal customers has an effect on your external customers.

Customer satisfaction mirrors employee satisfaction. Customer loyalty parallels employee loyalty. And loyalty is a leading predictor of your company’s profitability.

Value added organizations pride themselves on teamwork. They realize that a team is only as strong as its weakest member. They leverage this synergy to serve their customers better.

There are three things that characterize this teamwork. First, We is greater than me. Teams fail when there’s too much me and not enough we. Second, they treat each other with the same respect they exhibit for their best customer. Third, they build each other up not break each other down.

How you support fellow team members and serve internal customers affects your organization’s performance. Remember, organizational excellence is the natural outcome of individual and team performance.

How you Engage Customers

In value added organizations serving customers is a privilege not a pain. Customer service is more than a department. It’s a philosophy in which everyone in the organization feels and acts accountable for creating satisfied customers.

Value added organizations are proactive with their service. They nip problems in the bud. Being proactive means never having to say you’re sorry to the customer. They anticipate and act in advance.

Because of this strong customer focus, they define value in customer terms. They’ve discovered that if you define value in customer terms, customers pay for it with a higher selling price. If you define value in seller terms, you will pay for it with a higher discount.

Selling and serving is relationship management. How well do you manage the relationship with your customers? Customer loyalty goes with the person not the brand. One of the great marketing myths is brand loyalty. Customers prefer brands but reserve loyalty for people. This loyalty results from their experience in dealing with a supplier. How’s your customer loyalty?

Value added organizations are constantly looking for ways to recreate value for their customers. A desperate curiosity about their potential coupled with a strong customer value focus encourages value added organizations to dream and stretch. They live by the question, What if ? 

What if we could do it this way?—What if we could design a better way for the customer to do things?—What if we could make it easier for the customer to do business with our company?

Value added organizations challenge the status quo. There are no sacred cows in these companies. “Does this policy, procedure, or process add value to our efforts or does it just add cost?” The things your company does that add cost without adding value diminish your position in the marketplace.

Value added organizations are great because of their people. They believe that people can and do make a difference. With the commoditization of products and the convergence of services, companies are churning out millions of look-alike products and services. The single, unique dimension of value is their people.

A company president said to me recently, “Tom, we used to be a value added peak competitor organization until we lost our best people. Now we’re just like everyone else.”

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Tom Reilly is president of Tom Reilly Training, a St. Louis-based firm specializing in training salespeople and sales managers. This is an excerpt from his book, The Value Added Organization. He is also the author of the books, Simple Psychology,  Customer Service Is More Than a Department, Coaching for Sales Success, Value Added Selling, Selling Smart, Crush Price Objections, How to Sell and Manage in Tough Times and Tough Markets, and Get Out of the Wagon and Help Me Pull This Thing. For more information contact: Tom Reilly Training, 171 Chesterfield Industrial Boulevard, Chesterfield, MO 63005    (636) 537-3360    www.tomreillytraining.com