Seeing fast-growing businesses seemingly appear from nowhere and become international success stories in the time it took you to grow from two to ten people can be distracting and demoralising. How many taxi firms have had to dismantle their growth strategies given the rise of Uber, for example?
As either a fledgling or even a fast-growing SME, what happens when big customers with deep pockets come along demanding a service that flies in the face of your business strategy?
Should you be tempted to abandon your approach if it means clinching a game-changing deal? Or does that send out a negative and unprofessional message to your other customers, prospects, potential investors and employees?
What you have to remember is that different businesses in different industries grow at different rates. If you’ve set out a long-term goal of where you want to be in ten years’ time, then you have to be true to those objectives. That doesn’t mean that you can’t learn and innovate, but your fundamental strategy is something you should have thought long and hard about and in which you should have complete confidence. Let’s use a fictional example to help us visualise this.
Blinded by the light
Having read Business Administration and Public Entrepreneurship professor Mitchell Weiss discuss the dilemma of a fictional company on whether to change its strategy to suit the needs of a major customer, I thought about how I’d feel in the same position as the UK business leader of a global data management company.
The company of Weiss’s creation, Lumiscape, is a smart streetlight manufacturer which has recently moved away from a sales-based model to a service-based model. Renting streetlights to local authorities with a management and maintenance contract provides more control than selling the streetlights and allowing authorities to manage them (badly). However, renting streetlights generates less direct revenue than selling them.
In the fictional world of Lumiscape, a huge deal which is the legacy of sales outreach based on the old sales-based model comes back onto the scene and splits the founding partners – some want to sell, others want to follow the current strategy. What should they do?
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The frustrating thing for me and the general question of strategy versus sales is that the question itself and its apparent solutions are so restrictive. Do we make the sale and abandon our strategy? Or do we stick to our strategy and lose the deal?
For me this is a narrow view of doing business. Your strategy shouldn’t necessarily be to sell to the highest bidder. Your customers are a huge part of the value you provide to the world though – and their requirements should be front of mind in every interaction with them.
Modern technologies are showing us new, disruptive models for doing business that are based on flexibility and providing a service that is tailored to our customers’ expectations. Going back to Lumiscape, while their service-based model was their sales strategy and preferred method of structuring deals, was it their entire purpose as a company?
If I was in their shoes, my purpose would be to provide smart streetlights to keep the lights on and electricity consumption down. So, rather than looking at the deal as something that went against my business strategy, I’d look at it as something that would facilitate my greater raison d’être.
Customers don’t buy strategies
Ultimately, customers buy products, services, experiences and people – they don’t buy your strategy. In my real role at NetApp, I am loathed to reject a customer’s requirements if I feel that we can accommodate them.
Therefore, I would look for a solution that would not compromise our entire business strategy and values, but would fulfil the customer’s short and long-term needs and expectations.
Furthermore, if you are finding that your customers’ needs are constantly calling your strategy into question, then you need to consider why. Markets move and customer expectations are constantly evolving and modern, data-driven business models support more flexible approaches to business that allow you to compromise and adapt to win big deals, whilst maintaining an identity, strategy and culture of doing business.
So whilst it’s essential to have a strategy in place to run your business, keep the option open to be able refine your strategy in line with your customers’ demands as well as your businesses’ purpose.
Elliot Howard is UK & Ireland country manager at NetApp
If you fancy a unique approach, the strategy Tyra Banks had to become a leading supermodel can be used in business.
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