Category Archives: Reality checks

Are You A Middleman?

I was having lunch yesterday with a business friend and he remarked on some new eyeglasses I’d recently bought.

eyeglasses

(Photo credit: Lynn Kelley Author)

I told him about the purchase process and how the next time I bought some new specs (these were an emergency purchase due to a misplaced foot) I’d be doing so online. I talked about Warby Parker and how they are selling high quality frames and lenses for under $100. I went on to talk about an article in the Times this week on how there were companies like W/P who are cutting out the middlemen in areas such as bedding (Crane and Canopy), office supplies (Poppin), nail polish (Julep), tech accessories (Monoprice), men’s shoes (Beckett Simonon) and shaving supplies (Harry’s).

As I drove back from lunch I thought about how that process really should raise a question for each of us and every business:  what value are we adding?  The reason the above companies are successful is that they’re offering the same high-quality products at lower prices by cutting several layers out of the business transaction.  Obviously, if the quality of the end-product remains the same, all of those layers were adding nothing of value but were adding to the costs.

Disintermediation is probably the biggest effect the internet has had over the last twenty years.  It’s not just in the retail chain either.  Video on demand services such as Netflix cut out the local video store.  The ability for program creators to access audiences directly has cut out distributors such as TV networks and even cable systems.  The easiest way for any of the middlemen to remain a part of the equation is for them to define the value they bring to the sale and make that value very apparent.  This is true, perhaps even more so, if you’re in a service business.

There is a tendency to think that the technology is simply making things more efficient.  If clarifying the value chain means “efficient” then I guess I agree.  If you are a middleman of any sort, you need to be doing that clarification yourself, both internally and externally.  Does that make sense?

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The Walking Dead

I realize I may be the last one to the Walking Dead dance. Don’t rub it in. I just started watching the show a little while ago and have meant to write about it but with the season finale last night I thought I’d better do so while it’s still relevant. I realize as well that it’s April Fool’s Day so writing about a show built around a zombie apocalypse seemed appropriate.

Seeing as the screed usually covers business, I know you’re wondering how this could, in fact, be an appropriate topic. If you need to ask you must never have worked in a company of more than 10 people.  If you have worked in that larger environment you’ve probably encountered zombies on many occasions   Maybe you’ve never  recognized them as such?

On the Walking Dead, the zombies are portrayed as slow-moving “walkers” with an insatiable appetite for human flesh.  Of course, they themselves were once human and productive members of society.  Now, they roam the planet spreading disease and death and living as parasites on the dwindling numbers of humans around them.   Not to sound deranged, but I’ve seen this exact thing in a business environment.   There are the “undead” staff members who roam the halls, attracted by loud noises and movement (on the show, a sure-fire way to attract walkers is to fire a weapon).  These zombie workers might once have been alive and productive but now their work life is gone.  Maybe it was a stifling boss that strangled them to death or maybe it was terminal burnout from pushing themselves too hard.

Just as the zombie apocalypse is destroying the planet on the show, so too are the zombie workers killing many businesses.   Once the zombies show up they infect others.  In fact, they’re aggressive about doing so.  They spread rumors, they bad-mouth bosses and coworkers.  They denigrate everyone else’s work.  They don’t seem to have any feelings and they rarely contribute.

Obviously I’m not advocating removing the zombies as they do on the show (you need to destroy their brains – even cutting off their heads doesn’t kill them).  I am, however, encouraging you to look carefully at those who appear to be human all around you  with an increased sensitivity to zombie infection.  Sometimes the infection hasn’t turned them yet and you can intervene.  Sometimes you can put up enough barriers between you and the zombies that they can’t get near you.  Most of the time, you’re better off just running away.  Remember – the title of the show refers to the humans that are left, not to the zombies!

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Believing The Seeding

I hope you spent at least some of the weekend watching the NCAA Men’s or Women’s Basketball Tournament.  The country seems to have a national obsession with brackets and as it turns out there was a lot of pretty compelling basketball behind the pools.  By the way – I find it kind of amazing that as the sports leagues and organizations – MLB, NFL, and NCAA among others – got comfortable with the fan-generated activities such as fantasy and bracket pools the viewership and engagement of the public grew.  The organizing entities spent a lot of time telling broadcasters and others to ignore those activities (heaven forbid we actually encourage engagement!) because they were gambling or worse.  Good lesson on listening and not getting in the way of people who want to love your brand!

English: National Collegiate Athletic Associat...

(Photo credit: Wikipedia)

In any event, one thing I took away from this weekend was the power of positioning and how it can affect performance.  What I mean by that is the “upsets” we saw as low seeded teams – presumably weaker squads – beat high seeds – top teams from big conferences.  Then again, Gonzaga was a number 1 seed but came from a weaker conference and barely won their first game before getting “upset” by a #9 seed.  A few of the other #1 seeds barely got by.  Which is the business lesson.

So often we believe the seedings.  We’re told our company isn’t good enough or we don’t have enough experience.  The people who hire people or firms on that basis are believing the seedings that they divine from resumes or capabilities presentations.  Too bad.  Given the way business works these days there have been a lot more upsets than there have been results in line with the seedings.  There is a lot more parity.

More importantly, not one of the teams that upset a top seed felt as if they had lost before the game started.  Just the opposite.  Every one of them knew there were in the tournament because they had won a lot more than they had lost.  They believed in themselves and played as a team and not as the function of some mystical RPI equation.  In their minds the seeding was going to be done by the final score.

Don’t believe the seeding.  Sure, you or your firm might be the underdog, but you’re in the  game for a reason.  You with me?

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Filed under Reality checks, What's Going On