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Certified Professional Manufacturers

Representatives

Building the Foundation

CPMR 101

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Objectives

Build the foundation for 21st Century PMR

Provide an overview of the concept of corporate culture

Briefly discuss the major trends reshaping the competitive landscape as well as ways to thrive in this hyper-competitive environment

Provide a model and a profile of a 21st century Professional Manufacturers Representative.

Introduce a handful of steps for getting started including a self-audit tool you can use to see where you stand.

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Desired Outcomes

We can declare victory if YOU … Have a better understanding of the “big

picture” trends that are transforming the world of business.

Complete the Professional Manufacturers Representative Profile for your firm.

Get a couple of ideas you can take home and implement.

Leave challenged … and energized to take your game to the next level.

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Starting Agreements

Change is needed … change is inevitable! But who needs to change?

Preaching to the choir Good to great.

Be open. Turn off your auto-reject response.

Provide a smorgasbord of ideas, examples and challenges. Invite you to try them on. If something fits,

keep it. If it doesn’t, leave it. Don’t hate the messenger.

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Exercise1. How have your industry and your firm

changed over the past five years?

2. How will your industry change over the next five years?

3. What is the prognosis for your firm if you adopt a “business-as-usual” approach for the next five years?

4. How will your firm have to change over the next five years? What are you doing about it?

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Unprecedented Change

Staggering rate of accelerating, unpredictable, and discontinuous changes.

Trends historically took longer in coming than expected, but not any more!

Less and less “float time” to get ready.

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The Squeeze is On!

Era of customer power Commoditization of products and

services Cost containment, spend

reduction, and supply chain management

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What’s Going On?

Wal-Mart Effect

BRIC Effect

Flat World Effect

Innovate or

else…

And Today …

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What’s the Antidote?

1. Expand your frame.

2. Customer focus in everything you do.

3. Anticipate and innovate.

4. Connect and collaborate.

5. Be professional.

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Expand Your Frame

1. Business you are in

2. Your firm’s products and services

3. How you add value

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Video Case

Louisville Redbirds What business are they really in? What is their primary market? Who are their main competitors? What are their Customers’ requirements? What do they need to be really good at to

satisfy their Customers’ requirements? How might you have answered these

questions if you had chosen the more traditional definition of what business they are in?

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Expand Your Range

Business you are in Professional outsourced sales and marketing

services. Your firm’s products and services

Sales and marketing services. Extensive working knowledge of local markets. Deep understanding of customer needs in those

markets. Established relationships with customers in

those markets. How you add value

Optimizing the supply chains in the industries in which you operate.

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Focus on the Customer … and Add Value

Always start with … Who’s the customer and what do they want?

Make certain you contribute more than you cost.

Make a real and perceived difference to your customer … quantify your EVA -- economic value added.

Profit-takers will be extinct.

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Anticipate and Innovate Requires profound understanding of

your customers’ current and future needs.

Either come up with the new, new thing, orchestrate the supply chain or … commit to unrelenting innovation in everything you do so that you are constantly adding additional value in everything you do.

Keep strengthening your relationship with your core Customers.

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Connect and Collaborate You don’t have to do it all

yourself! Shift from vertical (command and

control) relationships to much more horizontal (connect and collaborate)

One of the core competencies for success in business today is partnering … Across town, across the country,

across the globe

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Be Professional

Pervasive commitment to operational excellence (and continuous innovation) in all areas

Competitive edge today … survival strategy for the 21st century Manufacturers Representative.

Professional Manufacturers Representative Profile

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Actual Ideal

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Manufacturers’ PMR Data

Actual Ideal*Positive Principal Relationships

15 88

Disciplined Customer Focus

50 88

Commitment to Service

47 87

Core Values and Integrity

41 96

Engaged people 57 89

Leadership 59 92

Clear Strategic Direction

38 85

Aligned Systems 40 85

* According to one respondent the scores should all be 100!

Exercise

What are the 3-5 words or phrase that your customers would use to describe your firm?

What are the 3-5 words or phrase that your principals would use to describe your firm?

If someone walked into your office or sat in on a sales call, what would they see or hear? How would they describe your firm?

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Corporate Culture What is It?

Textbook definitionCorporate culture is the shared values and behavior that tie an organization together. It is the rules of the game; the unseen meaning between the lines in the rule book. Culture is a way of doing things that is taken for granted. All organizations have a culture of their own.

Eliot Jacques’ definitionThe customary or traditional ways of thinking and doing things, which are shared to a greater or lesser degree by all members of the organization and which new members must learn and accept in order to be accepted into the service of the firm.

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Corporate Culture A Street Definition

The way we do things around here.

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Corproate Culture Where Does it Come From?

Nature of the business you are in Type of industry you represent Geography Climate Population density and ethnic

diversity Local economy Organization’s history Company founders Senior management

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Corporate Culture Key Dimensions

PervasivenessDegree to which the culture is widespread.

StrengthAmount of pressure the culture exerts on people.

DirectionCourse the culture causes the organization to follow; for example, positive or negative, adaptive or unadaptive.

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Corporate Culture Attributes

Universal Shared Learned Sub-cultures Official and unofficial Formal and informal Iceberg

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Corporate CultureVisible Organization

• Business processes• Management systems• Policies and procedures• Metrics -- which results you track• Incentives -- what gets rewarded

and who gets ahead• Organizational structure and

jobs/tasks

Invisible Organization• Norms, values, and beliefs• Unwritten rules • Political system• Relationships and networks• Informal leaders• Informal reinforcement• Mental models and shared

meanings

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Corporate Culture

•Competitive environment

•Vision, mission, and strategy

•Leadership actions

•Performance measures

•People practices

•Structure

•Climate•Norms•Beliefs•Unwritten

rules•Values•Symbols

•Behaviors•Decisions•Actions

Performance

Culture Matters

Research results consistently show that …

High performance firms have more people-oriented cultures.

Low performance firms more frequently have “toxic” cultures.

Tim Baldwin, 2008

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Professional Manufacturers Representative Profile

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Actual Ideal

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Disciplined Customer Focus

50 Actual

88 Ideal

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Inside-out Thinking Customer focus starts with thinking and

working from the outside-in. Subtle but powerful shift in mind-set that

looks at what you do from the customer’s point of view.

Most sales people look at their customers from the inside out. View of the sales process begins with

themselves, their own needs, their products, their …

Focus is on doing something to the customer … persuading them, selling them something.

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Adding Value in an Acquisition Process

It’s ALL about adding value! Two distinct ways to create value in the

acquisition/sales process… Create additional benefits within the process. Reduce the cost of the benefits you already provide.

If you can not add value by increasing benefits, then reducing the cost of the acquisition/sales process is the only way to create added value. This inevitably means finding cheaper ways to

reach the market and to sell -- catalogs, telemarketing, outsourcing, e-commerce.

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Choose Your Customers

Your most precious resource is your time. Suggestions for how to segment your

customer base and prioritize how you spend your time.

1. Conduct a customer profitability analysis.

2. Assess your customers’ value orientation.

3. Use the 80-20 Pareto principle to segment your customers based on their value orientation

• Vital few• Important many

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Develop Key Account Plans

Develop written account plans for all of your key customers … Buyers -- current and potential Principals -- current and potential Other players in your supply chain

who could be potential customers.

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Positive Principal Relationships

15 Actual

88 Ideal

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Positive Principal Relationships

Relationship between manufacturers and representatives has to be seamless. Stop bickering!!! You absolutely need to be partners!!!

Partnering is the wave of the present because it leverages the core competencies of complementary firms.

It’s all about teamwork across your organizational boundaries.

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Successful Partnerships Genuine respect for each other. Mutually beneficial relationship with shared

risk and shared resources. Shared commitment to common mission,

vision, and goals. Joint planning. Mutual accountability for success. Clear roles, responsibilities, and

expectations. Close linkages at many levels. Regular multi-channel communication.

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Clear Strategic Direction

38 Actual

85 Ideal

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Value Proposition

“Promise” you make to your customers What you provide to your customers How you deliver your products/services What you are known for

How you differentiate yourself in the eyes of your customers -- both manufacturers and buyers

Creates delighted customers and fosters loyalty

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Defining Your Value Proposition

No formula and no cookbook. Requires deep and profound knowledge of your

key customers and their needs/problems as well as your product/services and solutions.

Some starting questions … What can you be the best at? What are you deeply passionate about? What

deeper sense of purpose would motivate you to continue working for your your firm even if you were independently wealthy?

Why does your firm exist? How do you add value? Why is that important? Repeat this question 3-4 times.

Where and how can you receive a reasonable return on your efforts (i.e., profits) in all of this?

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Aligned Systems

40 Actual

85 Ideal

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Aligned Systems

Everything you do, every decision you make, every system you implement, every policy and procedure you establish, every person you hire, every business partner you work with needs to be focused on … Adding value for your key customers Meeting and exceeding your key customers’

expectations Optimizing your core processes … solution

development and relationship management Key is the consistency, reinforcement,

integration, and optimization of all effort.

Leadership• Ability to set direction, align resources, and motivate an

organization.• Providing clear and consistent direction.• Management modeling the values, desired beliefs, vision and

desired practices and reinforcing appropriate behaviors.• Leadership style and competencies -- knowledge and skills.

Culture• Unwritten rules and unspoken values, beliefs, assumptions, and

attitudes that specify how things really get done in an organization.

• Values, beliefs, assumptions, and behaviors exhibited by people in the organization.

Management Process• Processes required to

align resources and reinforce, monitor, and produce desired outcomes.

• Planning, resource allocation, and priority setting

• Budgeting and financial control

• Measurement, performance feedback, and monitoring systems

• Information/communication systems

• Decision making style and use of data

• Reward and recognition system

Structure• How people are brought

together to do the work• Reporting relationships

and linking mechanisms• Roles and

responsibilities• Critical

interdependencies and tensions in structure

• Departmentation -- Functional, geographic, customer, process, matrix

• Nature of coordination -- hierarchical vs team-based

• Degree of centralization

Process• Flow of work

describing how products and services are produced and value is created.

• Capability -- effectiveness and efficiency --of processes

• Work methods and standard operating procedures

• Utilization of technology/equipment

People• Knowledge, skills

and abilities • Staffing levels• Recruiting &

retention• Assessment &

selection• Development

systems & succession planning

• Performance management

• Compensation administration

StrategicAspirations

Culture

Process

Leadership

StructureManagement

Processes

People

Organizational Architecture Model

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Southwest Airlines Example

Disciplined service mission

Thirty years. One mission. Low fares. Focused and aligned value creation system

Short haul, point-to-point routes between midsize cities into secondary airports

15-minute gate turnarounds No seat assignments, no meals, no

connections with other airlines or baggage transfers

High aircraft utilization Standardized fleet of 737 aircraft

Lean, highly productive ground and gate crews

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Aligned SystemsLining up the Arrows

Clear strategic direction

Loyal, S

ati

sfied

C

ust

om

ers

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Another View

Unaligned systems

Disgruntled Customers

Unclear strategic direction

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Engaged People

57 Actual

89 Ideal

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Imagine …

Everyone in your firm is working toward the same simple, compelling goals.

Everyone is committed to adding value and satisfying your customers and your principals.

Unnecessary work and unproductive time have been virtually eliminated.

People genuinely respect and trust each other to do their jobs.

People are open to change. They constantly suggest and implement great ideas to strengthen the firm.

People take initiative and have a can-do attitude. A spirit of teamwork pervades the firm. People are really excited and enthusiastic about their

jobs and positive about the business.

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Would Performance Increase

Less than 25%? 25% to 50%? More than

50%?

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Fostering High Engagement

Can not be forced.

Time consuming.

Either do it or prepare for the consequences.

You can buy a person's time. You can buy his physical presence at a given place; you can even buy a measured number of his skilled muscular motions per hour. But you can not buy enthusiasm…you can not buy the devotion of hearts, minds, or souls.

You must earn these.

SourceUnknown

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Service-Profit Link

If you take of your employees …

Your employees will take of your customers and …

Your customers will take care of your bottom line.

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Leadership

59 Actual

92 Ideal

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Positive IntentionsLeadership, in its most powerful and compelling form, will not work without positive intentions. A positive intent, a focus on others instead of self, is the foundation of leadership. Without that foundation, all the skills, techniques and trappings of leadership will ring hollow; people will always sense the contradictions, and they will never give 100 percent support – they will always have a back door But when the positive intent is there, all the skills of leadership will naturally follow.

Larry Wilson

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Core Values and Integrity

59 Actual

92 Ideal

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Core Values

Reputation

Character of the firm

Core values

Activities, decisions,

work processes

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Core Values

Small set of deeply held timeless guiding principles that reflect what really matters to you.

Foundation and reflection of the character of your firm as well as your reputation and your brand.

Your firm’s core values must be … Authentic Reflect genuine commitment to service and customer

satisfaction Clearly, consistently and constantly articulated to

everyone Understood by all and important to them Reinforced through visible role models and visible

accountability -- clear expectations and consequences

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Commitment to Service

47 Actual

87 Ideal

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Service is Job 1

Critical to create a pervasive service ethic.

Simple, but not easy, to do … what YOU say and what YOU do is what really counts.

Every interaction with the customer (face-to-face, by telephone, in writing, your principals’ products in use, etc.) is a service “moment of truth” for you company.

Only hire people who want to be of service.

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Taking it Back Home

1. Don’t jump the gun … let it all soak in.

2. Find the time … make it a priority.

3. Start small … build momentum.

4. Assess where you are … develop a plan.

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Develop a Plan

1. Review your PMR profile.• What insights did you gain from your PMR profile? What are your highest scores. What are your lowest scores?

• Choose 1-2 areas you want to improve? How much do you want to increase your score in the next 12 months?

• For each area, what 1-2 specific things do you need to change? Why?

• What challenges will you face in making these changes?

Put together a realistic plan based on no more than 2 SMART goals (Specific, Measurable, Achievable, Results-oriented, and Time-bounded) to work on this next year.

Identify specific next steps for each of your SMART goals to help you get started.

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High Payoff References

Collins, Jim. From Good to Great. New York: Harper and Row, 2001.

Friedman, Thomas. The World is Flat. New York: Farrar, Straus, and Giroux, 2005.

Rackham, Neil and De Vincentis, John. Rethinking the Sales Force: Redefining Selling to Create and Capture Customer Value. New York, NY: McGraw-Hill, 1999.

Wilson, Larry. Changing the Game: The New Way to Sell. New York, NY: Simon & Schuster, 1987.

Womack, James and Jones, Daniel. Lean Solutions: How Companies and Customers Can Create Value and Wealth Together. New York, NY: Free Press, 2005.

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Getting in Touch

www.theturningpointsolution.com

daustrom@tpaconsulting.com

317-439-0906 (cell)

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Study Guide for 101

Combine … A healthy dose of common sense, The lessons from the Louisville

Redbirds video, and A little extra attention to SLIDES …

8, 10, 11, 22, 23, 24, 25, 40, 44, 59, 60,