The Risk in Business of Estimating the Speed of Change

A simple thought for you today that could alter the course of your company’s future success forever.

It has been almost two weeks since the Inman Connect meeting was held in Las Vegas.

When I last wrote about my observations at that conference, you may recall that I commented on the final segment of the agenda on Friday. The Capital Connect sessions.

Each year when this session occurs I think to myself, “why wasn't this segment of the program placed at the front end of the agenda?” And this year, that thought resonated much more than in the past.

Here’s why.

There were two interviews that purposefully had “consumer representation” included in on the discussion. One related to the consumer real estate experience delivered by Opendoor and the other with the consumer lawsuit related to buyer broker fees.

In the first the consumer delivered a thoughtful accounting of the institutional delivery of Opendoor’s transactional processes compared to the traditional marketing process offered by the agents he knew and had done business with in his market. And the second provided insight into the current confusion the consumer has for the fees they are paying for services and in understanding who pays those fees.

And then this morning, Ron Hahn sends out the attached blog. And it made me think.

How many other issues are out there that are current frustrations of the consumer about our industry and what we do? Or what we do not do? And do we clearly understand what they are in order to proactively change them before the DOJ and a class action lawsuit surface them in the Courts? We do not need a defense if we are not doing things that are offensive.

So I submit this thought to you today.

When I have tried to surface such consumer frustration, our industry begins to point in all directions for guidance and leadership. And unfortunately, usually, nothing is changed. When I have questioned this result, most often I have been told that there is no need to change because the legal system will take “years to remedy such things” or by the time the issue surfaces “we will be out of this business.” Really?

That is why I have narrowed down all of the risks we take in this industry to this one statement I have made many times publicly. “The greatest risk to take in business is estimating the speed of change.”

So here is my recommendation for you in managing this risk today.

First, you should not depend on others to measure and monitor what the consumer thinks of what you are doing. This is not a matter of going with the crowd, or following the industry, this is a matter of surfacing the issues before they become a challenge to the core of your business. And being an advocate for changing what is not working for the consumer. So how do you do this? Here is my suggestion for your consideration.

Ask those consumers that could be your future customers. Ask your current customers that are doing business with you. Ask your immediate past customers. And I would not wait, I would do this now.

In the real world that means making a few very purposeful changes in your organizations. This to send a clear message of your on-going concern for the well being of the consumer and of your customers. To that end, have you considered appointing a Chief Consumer Experience Officer? Maybe that would be a good start. And that should be the person in your company who is responsible for surfacing the needs and frustrations of the consumer.

Focus groups, surveys, phone calls, customer appreciation events all provide great venues for this positive-results discovery process

In closing I will share again what I learned from a previous employer of mine named Sears This company was at the time a major retail corporation with a tremendous consumer following and presence. And due to my corporate responsibility I was called to the company’s headquarters on many occasions to meet in the Corporate Boardroom located then in the Sears Tower in Chicago. The in those meetings, the Chairman of the Board frequently pointed to an empty chair at the table that had a sign on it that read, “The Customer.” I was always impressed with that until Sears fell from its position as the #1 retailer in the U. S.

Then after all those years, I had this one important realization.

Why was that chair that was reserved for the customer vacant during all those meetings? Where was the customer? I get the symbolism, but what about the lack of real time, actual feedback from the customer? Yes, we constantly pointed to that chair and questioned what the consumer would say if they were present, so what happened? And then it dawned on me. Maybe the consumer should have actually been there and maybe if they had been Sears might be in a much different place in the world of business now.

And you know what, I think that would have been true. Because what Sears failed to do back then all boiled down to their inability to estimate the true speed of change. To see around the corners before they were surprised by what was waiting for them out there competitively. And to understand where they were falling short of the expectations of the consumer before others stepped in and provided a viable alternative that ultimately displaced the entire Sears organization.

And that my friends, proved to be a very bad thing for Sears.

This message might appear a simple one, but it is one that I think is of the most critical importance to you and your company today. Is it time for your to have the consumer involved in every aspect of your consumer experience? If you want to maximize the competitive advantage of presence with the consumer that you enjoy today, this makes a lot of sense to me and I hope after you think about it, that it does for you as well.

Have a great day!