Month: August 2012

is price is less important than we think?

“When value exists, price doesn’t matter. Price is what we talk about in the absence of value.” ~ John A. Jenson

 

“I think it’s breaker #26. Right hand side, a couple up from the bottom.” My wife had called to tell me the air conditioning had stopped working and the temperature was pushing 90 degrees Fahrenheit inside the house and climbing. This happens periodically and is always just a breaker that’s tripped (it’s probably not a good sign that I know my breaker box by memory). Reset the breaker and cool air starts flowing from the vents again.

This time was different. No amount of fussing with the electrical system could get the air conditioning to kick on. It was a long, very uncomfortable night…

That was Wednesday. Thursday afternoon, the repair folks came out and said the a/c unit was done for and needed to be replaced. Did we want them to plan to come on Friday and get it done?

*          *          *

In business we often talk about value – creating value, providing value, value, value, value – but it’s an abstract boardroom concept that gets all tangled up with words like satisfaction, quality, and price. We’re told we should never get emotionally attached when we buy houses or cars as individuals so we’re able to walk away if we can’t get the right price.

And in all of that is the challenge. Despite all of humanity’s evidence to the contrary, economists, accountants, and financial types often have the mistaken impression that us humans are rational. That we are always seeking the lowest price and greatest benefit from our money. That we are concerned about price. That we don’t make emotional decisions. That price = value.

But that seems incorrect. Here’s a better (oversimplified) formula:

Solution = Value.

The smaller the problem, the easier the solution, the less emotional attachment, the less value there is and the more price matters. The bigger the problem, the more difficult or imperative the solution, the more emotional attachment, the more value there is and the less price matters.

*          *          *

Thursday afternoon at 4:50pm, needing to make a decision if we want them to fix the a/c on Friday. Sure we could do the rational thing, the thing that economists think we do, and get several quotes, study which air conditioning units are best, consider impact on resale value, etc. That would delay things well into the next week. We live in an area that (to me) feels like it is on the face of the sun for four months a year.

The quick discussion my wife and I had as we faced another sweltering night was: Can they make it work tomorrow? (yes) Can we afford it? (we will, regardless). Done.

John Jenson is right: when value (a solution to a significant problem) exists, price doesn’t matter. The bigger the problems you can solve and the better you can solve them, the less people worry about price.

Let’s spin this to HR/training, sales, or any business function: when people are worried about price it means: a) we aren’t providing enough value; or b) the customer doesn’t fully understand the value we provide.

Thoughts?

the traps of fossils and fads

I suspect we’ve all known people who cling to youth long after youth is gone. Those middle agers who wear clothes currently in fashion with college students, hang out in clubs, are inordinately proud of how up to date they are, get their nose pierced with their teenage daughter to show how cool they are, etc. It’s silly and sparks mid-life crisis jokes, but overall tends to be harmless.

I suspect the opposite is actually more dangerous. Those who get stuck in time and fossilize prematurely. They cling to the world that existed when they were coming of age. Anything new after that date is feared, ridiculed, shunned. Every year the world becomes more black/white, right/wrong, good/bad. It’s like their brains crystalize and they are unable or unwilling to adapt past a certain point.

This carries over into the organizational level. There are leaders who jump on every latest trend and fad of the moment only to quickly discard it for the next-and-better trend and fad of the moment. They adopt an approach before it’s proven and then toss it aside before it has a chance to work. And… there are the leaders who believe that whatever worked when they first became a manager still works today and they aren’t about to get suckered into using any of this newfangled stuff.

This isn’t a young vs old, Generation Up and Coming vs Generation Soon to Retire issue. People can be cynical beyond their years or in a desperate short attention span search for new and trending at any age. So can teams, departments, and organizations.  HR is guilty of both, but I suspect that these extremes exist in all fields.

I started off wondering which extreme is worse, but realized that it doesn’t matter. Neither extreme is very useful, helpful, or fun to be around. The bigger question is how do we benefit from the new, evolving, and experimental without needlessly abandoning the approaches that do work (or work well enough for now)? How do we dodge the equally dangerous traps of the latest fads and that’s-how-we’ve-always-done-it?

it’s not my fault

“IT’S NOT MY FAULT! I’M NOT TAKING THE HIT ON THIS ONE!”

Few things are more awkward than being in the presence of people who are arguing. Except maybe when they are arguing about you.

“THEY CAME IN AND SAT DOWN WHEN SHE WAS ON BREAK. SHE DIDN’T NOTICE THEM.”

We were at a “travel center” (which is a vague marketing euphemism for truck stop) in the middle of somewhere New Mexico. It had been a long day of driving and we were trying to decide whether to push on despite an ugly storm brewing to the east or find a hotel and not arrive home the next day until several hours later than planned. Right now we needed food.

The gentleman tending the buffet told us we should get our meals, have a seat, and our waitress would get our drink order. Easy enough, except she didn’t. One waitress was tending the booths on either side of us and was able to completely block out our presence from her consciousness. Another focused on customers on the other side of the room.

Eventually, we stopped the waitress working near us and mentioned that no one had come by to take our drink order. She went off and hassled the other waitress. Waitress #2 came by, seemed apologetic, and we told her we were ready to go but would like to get some water in to-go cups. She disappeared and we could hear her talking to a third person who I’m assuming was the manager.

Cue the yelling. Start the blaming. They were behind a thin wall that blocked the kitchen from view but did nothing to dampen the sound. The argument was focused on blame, finger pointing, who was going to be in trouble, and who had dropped the ball by not getting us drinks.

And we still didn’t have any water. They were too busy fighting over who should have been helping the customer to actually bother to help the customer.

Mistakes happen, things get overlooked, processes fail, the customer / end user does something unexpected or unanticipated, etc. etc. What happens next tells me a lot about the company, the employees, and your leadership abilities. In the event things don’t go right, do your employees: 1) solve the immediate problem; 2) solve the immediate problem and then fix the underlying issue so it doesn’t happen again; or 3) make sure they don’t get blamed for it?

vacation, holiday, time away

You might have noticed I haven’t been around lately. I disappeared from twitter, haven’t commented on other blogs, and haven’t posted any of my own. I’ve been on vacation and it was nice.

I’m getting better and better about taking vacations and getting away. In the past I was a consultant or contractor and very rarely took more than a few days off at a time. If I wasn’t working, I wasn’t making money. Now that I’m with a company that actually encourages getting some time away, I find myself enjoying my vacations more and more each year.

My vacations are pretty low key – return to the high desert, spend time with friends and family, mountain bike, eat too much, etc. Others would find that a bore and instead seek out cities, cruises, casinos, and nightlife. Others still might prefer to completely get away and go camping, hiking, fishing or hunting. Or take a camera, journal, and passport and travel the world. Or…

Actually, it doesn’t really matter what you do as long as it works for you. Just as rest and recovery is an integral component of a serious athlete’s training program, I suspect that active and conscious rest and recovery is a necessary part of a successful career. Time away NOT THINKING ABOUT WORK allows us to come back refreshed and attack the issues, problems, and challenges with a new zeal and fresh perspective. It allows us to step back and approach it from a different angle. To step away from the grind, reconnect, and refocus on the parts that make our jobs worthwhile.

What recharges your batteries?