[Transcript]E006: Turn Your Customers Into Collaborators

Nina Radetich: The Catapult Business Growth Podcast is ready for the new year. Glad you're with us for this episode. My name is Nina Radetich. Here with me is the CEO of Catapult Groups, Brad Mishlove.  

Brad, it is time to get down to business in 2018. And, in this episode, we're going to discuss this concept of turning your customers, into collaborators, and what I love about this is when I originally suggested the topic it was about turning competitors into collaborators and you said, "Nope, let's change that to customers." 

Why? 

Brad Mishlove: Well, first, good morning. 

Nina Radetich: Good morning. I got right into it today. 

Brad Mishlove: And, you've actually picked one of my best, my best topics. 

Nina Radetich: Great. 

Brad Mishlove: I'm not interested in competitors. I'm interested in customers.  

Nina Radetich: Why is that? 

Brad Mishlove: Because customers buy, competitors don't.  

Nina Radetich: Do you think companies then spend too much time focusing on the competition? 

Brad Mishlove: Yeah. I think, look, you need to know what your competition is doing from a very, kind of, high level in the weeds, but I don't think copying the competition works. It didn't work for all the airlines that tried to copy Southwest. You know? Look, they can put the seats and pack you in there, on their thing, they can give you peanuts, but none of them have that value chain from start to finish, like Southwest does.  

Not a single one of them has been able to duplicate it. I mean, they can fly on their planes, they can read the book, they can observe, and observe, but nobody turns around their planes like they do.  

Nina Radetich: So, why does a customer-centric company, like Southwest win? 

Brad Mishlove: Well, I think they win for a number of reasons. One is they are interested in what their customers are thinking, and perhaps, they're asking their customers what issues they see coming down the pipeline, and I don't know much about Southwest, other than what I've read in the press, but I do know that many airlines have tried, and failed to duplicate their model. 

And, I think that goes across the board with many, many other companies. They just can't do it. The key, in my opinion, is having conversations with your customers in an exploratory fashion.  

For example, if I were going to say to you, you know, what do you see in terms of challenges, for your business, in the next say 18 to 24 months, and from whatever data you would provide me, my job, for the extent that I'm capable of it is to innovate. Is to provide you with solutions, and perhaps suggestions for things you haven't even thought of.  

So, I'm not asking you how to do my business better. I'm asking you what issues come up in your business? And, to the extent that my expertise can yield some benefits to you, and some value to your organization, I'm going to innovate around that.  

So, I'm really looking for our listeners to be able to innovate better than their competitors, but if you're just copying your competitors that's not innovation. That's merely just doing what they're doing. Well, how is that set up by a standard? 

That becomes a "me too" and it [commoditizes 00:03:09] your company, as opposed to differentiating your company, and differentiation is where we get better margin where it's easy to understand in terms of a marketing message. I can communicate that, why we're different, why our value proposition may be better than the others, so that's where I need to understand my competitors. 

Nina Radetich: You mentioned getting your customers to talk to you, having conversations, how do you get them to engage? 

Because, you know, as part of marketing strategies, we always include interviews with clients, customers, who you serve, to get insight into the company, but it's not always easy to get people to participate.  

Brad Mishlove: Well, and this is where I think face time is important, and I think it is the role of the CEO to draw this information out. So, a CEO that's just purely holed up in his, or her, office is not having those conversations.  

So, I think it comes from a number of places. Today we're talking about customers, but it's also from your employees. So, there's this idea of management by walking around in your plant, or office ... I think it's important, because there is more ideas coming from the people who work there, and the customers of the company than you're going to be able to create from your corner office.  

Nina Radetich: So, would you say that the folks that are more front facing are going to be the ones who are going to translate that, what they get from the customers to the CEO. 

Brad Mishlove: No, I think the CEO has to take that data and ask really good questions.  

Nina Radetich: So, go deeper than? 

Brad Mishlove: They have to go deeper. You don't stop on the surface, and it's ... to whatever the comment is ... I want to know more. Tell me more about that, and what else, and you keep digging until you uncover the gold, if you will, and so, I would encourage them to go out, go with their sales staffs, go with their production staff, go meet the customers, ask them questions.  

Getting out in the field, if you will, I think has got tremendous value. You'll come back with lots of ideas.  

Nina Radetich: What kind of gold can you glean from your customers? 

Brad Mishlove: Well, you can glean your next river of cash, your next innovation, your next product line, a product line you haven't even thought of. A new way to serve your customers.  

So, you can grow your firm's revenue from people you already know by offering them items, products, services, that are of great value to them. Some of which they probably haven't even thought of.  

So, that's the role of the CEO. It's that strategist, it's that forward thinking, it's finding that next cash flow stream for the company. That's where the role is, and that doesn't come from isolation. That comes from connectivity with your customers and your employees.  

Nina Radetich: I would imagine it's hard to maintain that connectivity when you are so busy trying to put out fires and do other things.  

Brad Mishlove: Right, but it is not the role of CEO to put out fires, it's the role to move the company forward, to have vision, to have strategy, and to hire some great talent to execute those strategies.  

So, yeah. I would say get out of the office and go see some folks.  

Nina Radetich: You talked a little bit about Southwest. 

Can you give us another example of a company that turned its customers into collaborators, and how they succeeded? 

Brad Mishlove: Well, I can give you an example from my past, it's just coming to mind. We had a landscape company back in the 90's, and early 2000's, and you would think a traditional landscape company. A customer had a problem with their dirt on their lots. They had to do something with it, and through a discussion, it came out that they needed to haul the dirt away, and then they wanted to find a way ... they were bringing back a refined product that they were ordering to provide for the top soiling of the housing units.  

So, we through conversation devised where we would truck it to a vacant lot that they had. We would process the dirt, and then we would bring it back, and place it.  

So, we increased our revenue dramatically by offering the trucking services, the screening services, so we had a plant running with a large vibratory screen that would kind of filter the larger rocks out, and give you almost a nice fine sand, and then, we would truck it back, and place it.  

It saved the customer quite a bit of money, because they weren't ordering it from a third party, and having it delivered onsite, and then, disposing of all the spoils from the removal. So, we ran almost like a recycling plant for them, which tremendously expanded our role, and became into the trucking business, and the dirt refinement business, in addition to a landscaping business. 

So, that's just a simple example, but that only came from having discussions.  

What's the issue here? Well, the issue is we have all this dirt to get rid of. What are we going to do with it? And, we're buying all this other dirt to complete a finished product. That worked out very, very well, I think, for both companies.  

Nina Radetich: And, instead of saying, well, let us figure out how we can find somebody else to help you with this. You actually listened to what they were saying, what the problem was, and innovated as a result of it.  

Brad Mishlove: Well, not only did we innovate, but we innovated very quickly. We flew to Phoenix, from Las Vegas, with two drivers. They drove the trucks back because we didn't have any trucks at the time.  

Nina Radetich: Wow.  

Brad Mishlove: So, it was a let's do this, and do this quickly type thing, and that's from being flexible. From having your ear to the ground, if you will, and knowing what's going on with your customers, and being willing to take a risk. 

Nina Radetich: That's what struck me. It was a risk, but it ended up being a really strategic, strong risk.  

Brad Mishlove: It was, and we ran that for multiple sites over the course of several years, and so it became a nice ongoing revenue business for us.  

Nina Radetich: With the advent of digital media there are a lot of different ways to engage with customers now. There's Facebook chatbots, there's social media. What role does digital media play in listening to your customers? 

Brad Mishlove: Well, I am no expert in Facebook or any of those other platforms, but ... 

Nina Radetich: But, you're aware of the capabilities, and the feedback that comes.  

Brad Mishlove: I am. I'm seeing some of our Catapult members where they're running ... I guess you would call it like a forum ... on their website, where they're allowing their customers to provide feedback, as to what features, and services that they would be interested in.  

And then, someone from the company is actually dialoguing with those customers, so they get some innovations, and some great ideas, out of that platform.  

Nina Radetich: Is this a hard sell for a lot of CEO's? This idea of turning customers into collaborators? 

Brad Mishlove: No. I don't think it is. I think that the key though is to slow down, so you can speed up a bit.  

Nina Radetich: It's your favorite piece of advice, I think.  

Brad Mishlove: It is. I see CEOs, many of them, particularly, in small to midsize firms running around like chickens without heads, and while that visually may seem pretty ugly that's effectively what they're doing, and we really need you to have your head about you.  

In doing so I think you open yourself up to great opportunities, so as the CEO, your job is to slow down and be strategic, and you can't do that when you're working in the business all the time. You've got to work on it.  

And, I think that is, probably, the most salient piece of advice I could give anybody running a company, is work on your business, and not in it.  

Nina Radetich: Can this hinder progress? Too many cooks in the kitchen syndrome? 

Brad Mishlove: Too many cooks in the kitchen can certainly do that, and we need to focus, so having innovation is terrific, having too much innovation, and not coming to market with appropriate products well thought out. That can be harmful, for sure.  

We can't have too many things going at the same time.  

Nina Radetich: But, I'm thinking in terms of, you know, how far should you take this collaboration with your customers? Because, I think, with all of the communications channels, nowadays, that are available to you, it could get to a place where it's too much input.   

Brad Mishlove: Well, you have to have a filter, for sure, and I do think it is also important to rise above the fray, if you will, to get above the noise. Okay? And, that's where periodic breaks come in very well for the CEO.  

Taking some time off is probably a great place to think about things, to focus, and I prefer a few good initiatives, well done, well thought out, well executed, then a whole bunch of initiatives partially done.  

Nina Radetich: Absolutely. Turning customers into collaborators. Great discussion, as always, Brad.  

Thank you. 

Brad Mishlove: Thank you, Nina. 

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