Entrepreneurship

Lessons Learned: The Most Effective Face to Our Customers

Learning the Lesson that I was the most effective “face” to our customers took me a long time and was critical to our ultimate growth and profitability.

In my Product Manager positions at GE and later as President of small Machinery Divisions I was often “trotted” out by the sales force to meet customers. Sales used it as an excuse to have a “customer visit” and I would give the standard “you are a valued customer” speech and be whisked away to the next of our top five customers. The less I knew about the technical details, the more “assistance” I got by the engineering guys who would also travel with me. At one such meeting with a crusty, old-line purchasing manager at Sweetheart Cup Company, I was told “Why should I get to know you? There were five guys in your position before you and there will be five more after you”…so much for “having an impact.”

Since I did not have a Sales background and had learned in LEAD all about delegation, it seemed that the most effective way to use my skills was to stay focused on strategy, vision and operations while leveraging the sales force as the front-line to our customers. I had watched the upper level Division, Group and Sector executives golfing with “key customers” and it seemed to be effective. Only once did a Plant Manager at a GM facility in Milan, Michigan ask for my home phone…and he proceeded to call me at 5:00 a.m. one morning to tell me that our $2 million Thermoforming machine was down and he was losing $22,000 an hour, and “what was I going to do about it?!”

This changed dramatically when I purchased my own business that only had one sales person and the old owner had a history of “hiding” in his office when customers showed up for fear that they wanted to talk with him about poor quality or late delivery. It took some strong and repeated advice from my advisory board to “get out on the road and start selling.” My own ethics made me uncomfortable with “relationship” selling-I am a shy guy and wanted to be home with my family. I did not want to do dinners, luncheons, sports tickets or just shooting the breeze with prospects. This is what the sales team did, not me!

Initially, I took over our troublesome Hewlett-Packard account and discovered that my lack of specific technical knowledge was forgiven as long as I told them “I don’t know” and got back to them with answers and quickly picked up the technical aspects of our products. I did everything from quoting to taking and entering orders and even delivering a couple of critical shipments. After a few simple questions they would share with me their plans, forecasts, information on competition, ideas that we should consider and ways in which we could improve and be distinctive. Even little detailsÿlike seeing how they stored our products on their inventory shelves resulted in our changing packaging to be consistent and distinguishable from other suppliers; we made the change for all our customers.

As I took on more customers, it turned out that most did not need “wining and dining” and what they cared more about was following though on commitments. There were many times when I was able to commit the entire organization to be responsive to a customer because of my position, and their memories about that lasted a long time. I also “fixed” things that went wrong and from time to time showed up with a “rework crew” and had my hands in there doing the rework. It made lasting impressions on customers that the “President” of the company had come out to correct our errors. When it became time to address pricing issues, I could do it with sincerity and tact; of course it helped that I never showed up in a fancy new car! And I never mentioned HBS or GE, ever!

There were not many company owners or presidents that they saw, and it allowed us to get higher pricing, more “last looks” and to hold on to business longer than many of our competitors who did not have a similar “personal touch.” The challenge, of course, is becoming spread too thin and I worked hard to train “program managers” to provide the same level of service and commitment as I did as the accounts began to stabilize.ÿ

After a couple of years, I was able to focus more time on new prospects. They never wanted exactly what we had to offer, so we always had to stretch our capabilities to serve their new needs. Each new opportunity was a stretch for the company and from the position I was in, I could make commitments and be sure that we delivered. More importantly, I began to see the new services, features and opportunities that would differentiate us from competition, attain higher margins and that would open up new markets for us to serve. Within 10 years, 80% of our customers were new.

Listening to the “voice of the customer” helped shape the success of the business. At the size that we were, their words came right to my ears. I had become the “rain maker” in developing new customers and it was difficult to extract myself from the business when I wanted to move on…another lesson learned!

AUTHOR’S BIOGRAPHY
Jim Sharpe (MBA `76) is one of theÿHBS Entrepreneurs-in-Residence for the 2009-2010 academic year, who ran an aluminum manufacturing business for 21 years while working with his wife, Debby Stein Sharpe (MBA `81) after both left careers at GE and large companies and sold the business in late 2008. Jim can be reached at: [email protected], 310 Rock Center, 617-496-6285.

October 5, 2009
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