19 Jun

A Recession is Coming….Threat or Opportunity?

While no one can accurately predict one, the signs of an impending recession seem to be mounting.

Earlier this month, the Federal Reserve updated its probability of a recession based on the Treasury Spread. The current inverted yield curve, which has been used as one leading indicator, has moved the probability of recession up sharply in the last year towards 30%.[1]

Another indicator: Nearly half, or 48%, of chief financial officers in the U.S. are predicting a recession by mid-2020, according to the Duke University/CFO Global Business Outlook survey, which is conducted quarterly. And more than two-thirds, 69%, are predicting a downturn by the end of next year.[2]

Other signs are looming such as lower GDP growth in China relative to what it was before 2010, the dramatic increase in alternative lenders in the U.S. economy called ‘shadow banking’, [3] and an expected interest rate cut by the Fed today. “The last time it [The Fed] entered a cutting cycle was September 2007. At that juncture, the subprime mortgage crisis had displayed clear signs of accelerating.“  [4]

Regardless of whether a downturn occurs within the next two years, a recession represents CHANGE. And when CHANGE occurs, be it technological, societal or economic in this case, there will be winners and losers. Those with the right outlook and a plan to leverage data and analytics will likely come out on top.  

How will your business respond?

The way in which different business organizations responded during the 2007 – 2009 ‘great recession’ has been studied by several researchers to identify winners and losers, and the strategic decisions that separated them.

In one study published in HBR, McKinsey clustered companies into ‘Resilients’ and ‘Nonresilients’. The Resilients returned between 6% and 8% more in returns to shareholders than industry peers did. Their performance dipped less overall during the downturn, and they were able to significantly widen their leads in their respective industries during economic recovery.  

As might be expected, these companies placed a high emphasis on controlling operating costs. In addition, resilient companies also focused on maintaining loyalty among high-value customers that were central to the company’s post-recession recovery. They were also smart at pricing. Using data and analysis about customers and their competition, the Resilients were forgoing revenues they could have earned through pricing changes. By contrast, industry peers were more likely to try and maintain revenue at any cost, applying price reductions haphazardly to products and services and sending mixed marketing messages. (See our recent post on using external data to excel at pricing)

One of our own clients illustrates the ability to grow, rather than retract, during an economic downturn.

The company is in the commercial printing industry – highly capital intensive and under constant pricing pressure from large corporate customers. In 2008 to 2009, the management team decided to explore growth through potential acquisitions of smaller players that may not be able to withstand the downturn. Rather than investing the time and money to approach companies directly, however, they asked for our assistance to identify potential targets and prioritize them based on certain attributes such as customer base, core assets, technology stack and capabilities. Armed with this insight, their legal and finance teams made formal introductions with confidence and very quickly made several acquisitions. The resulting market share gain (and some new digital capabilities gained in the process) moved our client into a leadership position in the industry.  

How they do it

Downturns bring a conundrum for business leaders. While the short-term demands caution, cutbacks and capital preservation, the long-term presents opportunities for growth. How do the winners excel?

  • Rather than cutting back, a key aspect of their success is continued investment in research, data and analysis to make smart decisions and focus their attention and investments where they have the greatest impact. Research, hypothesis testing and refinement save them from investing in marginal areas while directing investment to the most promising.

As a result, these organizations leap-frog their industry peers into new positions of growth with the eventual recovery. Will yours be one of the winners?


[1] https://www.newyorkfed.org/medialibrary/media/research/capital_markets/Prob_Rec.pdf

[2] https://www.cbsnews.com/news/nearly-half-of-u-s-financial-chiefs-expect-economic-recession-within-a-year/

[3] http://www.startribune.com/risky-borrowing-is-making-a-comeback-but-banks-are-on-the-sideline/511160862/

[4] https://www.cnbc.com/2019/06/19/the-federal-reserve-is-likely-to-say-rate-cuts-are-coming-satisfying-markets.html

06 Oct

Strategic and Competitive Intelligence Tips and Techniques

IMG_0282_4

Last week, Line of Sight Group partnered with the Strategic & Competitive Intelligence Professionals (SCIP) Association to deliver a panel discussion to explore how various organizational roles define and use intelligence to formulate strategy and execute go-to-market initiatives. The panel consisted of practitioners from several industries and across several roles. There were panelists and attendees not only from SCIP but from other associations representing the roles we sought including Product Development and Management Association (PDMA), Customer Experience Professional Association (CXPA) and the Special Libraries Association (SLA).

The fast-paced discussion first explored what types of intelligence were needed. With so much data available from so many sources, there is a heightened importance for analyzing, synthesizing and making sense of it. Several ideas emerged from making it simple, visual, or put into the context of the consumer of the intelligence. One of the firms had operationalized this into Red, Yellow, and Green dashboards. Some added that storytellers could be employed to convey the messages and clues found in the intelligence. There was attention given to the ways that technology was impacting the field – several firms are using or are built on analytics. Others are starting to look at Artificial Intelligence (AI) and Virtual Reality (VR).

There were some interesting examples, as well. One firm conducted Scenario Planning and accurately predicted the acquisition of Whole Foods by Amazon. Another example was that Red Roof Inns capitalized on the fact that 2% of all airline flights are cancelled and figured out a way to cater to temporarily stranded travelers yielding a very favorable business outcome.

Another aspect that emerged was the importance of building trust and collaborating amongst the various roles in research, product management, marketing, sales, customer experience and strategy formulation. With the advent of technology like cloud, mobile, big data and the aforementioned analytics, AI and VR, the notion of sustainable competitive advantage is challenged. This points towards an ongoing monitoring of the external environment to either avoid disruption or to get ahead of the curve and do some disruption.

The panel ended by sharing a list of helpful books:

  • The Amazon Way: 14 Leadership Principles Behind the World’s Most Disruptive Company by John Rossman
  • Do I Make Myself Clear? by Harold Evans
  • Principles: Life and Work by Ray Dalio
  • Originals: How Non-conformists Change the World by Adam Grant
  • Starting a Competitive Intelligence Function by SCIP
  • The Strategist by Cynthia A. Montgomery
  • Good Leaders Ask Great Questions by John C. Maxwell
  • Assorted Competitive Intelligence Books by Michael Porter and Liam Fahey
13 Sep

SCIP Minnesota Presents: A Panel Discussion with Line of Sight Group, PDMA & CXPA Practitioners

2017-09-13_17-47-31

Line of Sight Group is proud to be part of SCIP Minnesota’s panel discussion later this month. President and Founder Steve Schulz will join other top experts in the competitive intelligence, product management, and customer experience arenas.

The discussion will touch on and provide insight on common challenges, including the type of intelligence leadership is looking for, and illustrate how top practitioners gather intelligence for internal use and on their competitors. Panelists will also illustrate some useful tips and tools that are used by top practitioners.

Other panelists include:

  • Lori Laflin, Global Customer Engagement Research Program Manager, Cargill/ Member CXPA , CCXP
  • Paul Santilli, WW OEM Business Intelligence & Customer Insights at Hewlett Packard Enterprise/ Secretary & Treasurer, Board of Directors, SCIP
  • Mark Jensen, Director of Product Management-Distribution, Epicor Software/ Board of Directors, PDMA
  • Tom Mcgoldrick, Strategic Insights Director of UnitedHealth Group

The Panel will be moderated by Brett Norgaard, Principal, Line of Sight Group.

The SCIP MN Panel Discussion will take place September 27 from 5 pm-7 pm Central Time at the Grant Park Conference Room, 500 East Grant Street, Minneapolis, Minnesota.

For more information or to attend the event, please go to the SCIP MN website or reach out to MN Chapter Chair, Julie Johnson.

Line of Sight’s Market-i Competitive Intelligence Program is a SCIP “Endorsed” product. Strategic and Competitive Intelligence Professionals (SCIP) is the nonprofit Association representing the Integrated Intelligence industry internationally for over 32 years.

SCIP

 

 

31 Aug

When Listening to the Market, One Plus One Can Equal Three

OnePlusOnePic

I was talking with someone recently who wanted to accomplish three specific tasks – gather market intelligence, create competitive profiles and send out newsletters. As we talked further, we discovered that the three tasks were closely related. The conversation then shifted to what intelligence was needed and how would it be used?

In this situation, it probably makes sense to take one step back and conduct a Competitive Landscape Analysis using helpful frameworks like PESTEL and Five Forces.  These types of analyses can narrow the focus and yield a specific set of competitors and trends to study and monitor.

Next, a knowledge portal, like Line of Sight Group’s Market-i Competitive Intelligence System, enables a way to organize, relate and contextualize all types of structured and unstructured intelligence. Using this system and the information garnered from the Competitive Landscape Analysis, a team could start gathering competitive intelligence, saving it, and then creating weekly newsletters, demonstrating swift value.

After several weeks or months, competitive profiles could also be created. As soon as these profiles were activated, all of the previously posted articles and artifacts could automatically link and append to the profiles.  Similarly, any new intelligence added to Market-i would have immediate relevance and would add to the collective knowledge.  The newsletter function could also include tips and techniques for using the intelligence as well as information regarding what to look for and how to capture it.

Knowing what you are looking for, why you need it, and how you will use it will allow you to architect a solution that will provide short and long term benefits. It also becomes more valuable with each new piece of intelligence, report or artifact added. Finally, an approach that includes both a push and a pull aspect helps ensure that there will be high levels of engagement. The total value can indeed be greater than that of the parts.

29 Jun

Pulling the Sales Intelligence Advantage Levers

lever

One of the major trends in B2B selling over the past few years has been for sales teams to employ a strategy similar to management consultants – challenge, provoke and question clients and prospects about the status quo while building a case for a more compelling future. This approach has proven to be effective and requires a steady pipeline of relevant, specific and timely intelligence to back it up. Depending on the situation, there are a number of levers you can pull to arm the sales force with an intelligence advantage as they engage with executive level prospects.

The first lever is to conduct a Competitive Landscape Analysis – an exercise employing several management frameworks to review all forms of direct and indirect competition, relevant trends, opportunities and threats. This provides the sales team with a thorough understanding of their firm’s value proposition vs. the competition and relative to the market trends.

The next is to allow the Competitive Landscape Analysis to inform an ongoing Strategic Monitoring of announcements, updates and changes in the market. This ensures that the sales team is kept abreast of timely information and will not be caught off-guard when engaging with executive prospects.

Competitor Profiles can provide the sales team with a deep knowledge of the value proposition, positioning, differentiators, offers, customers, partners, personnel, and capabilities. Sales teams can use this insight to contrast themselves vs. their competitors when engaging with executive prospects. Battle Cards are a one page version of the Competitor Profile that focus on how to mitigate competitor strengths and exploit weaknesses.

Win/Loss Analysis gets to the heart of why deals are won and lost. Done correctly, they provide a wealth of objective feedback that the sales team can use to build upon strengths and learn from losses. The loss reviews provide some of the most useful feedback for improving the future win rate.

For sales teams heavily involved with services, Customer Experience Benchmarking can provide meaningful insight about the kind of service that their competitors are actually providing. This provides the sales team with the exact intelligence they need to outmaneuver competitors with customer experience issues.

Validating (or debunking) Competitor Claims in the market by interviewing a wide spectrum of people familiar with a competitor is an effective way to gauge the merit of market claims. Experience shows that many claims are false, putting the competitor on their heels and opening the door for a new approach to solving a problem.

The pulling of one or more intelligence levers will give the sales team a leg up by supporting their ability to approach executive prospects with knowledgeable, specific, consistent insight about their offer relative to the competition. This might turn out to be that slight edge when up against a competitor who might be ripe for the plucking.

25 Apr

To Increase CX (and Revenue), This Lender Gave Customers a Blank Check

Blog Post Pic - Blank Check

Line of Sight Group constantly engages in activities to keep abreast of trends in innovation, customer experience, sales methods, service adoption and business model transformation. One trend we have noticed are the parallels in the disciplines of product management, service design and customer experience.  Over the past few weeks, we have attended events and sessions in all of these disciplines and would like to share an observation demonstrating this convergence.

Representatives from the Baker Tilly firm shared an interesting Customer Experience (CX) case at the Product Development Management Association (PDMA) local chapter meeting the other day. It was the case of a lender pre-approving customers for vehicle purchases but then realizing that less than a quarter of the pre-approved customers actually returned to the lender to complete the loan. This was very disappointing to the lender as the process to pre-approve customers took time and effort. After performing a journey mapping exercise along with some current and future state analysis, the lender added one crucial step at the beginning of the process that changed everything.

What was the innovation?  The lender started sending along a blank check valid for up to the pre-approved loan amount with the customer as they entered the dealership to purchase their new vehicle. This gave the lender’s customers a powerful tool that provided them more control over the buying experience, let them bypass the time in the financial manager’s office where they were subject to every conceivable cross-sell and up-sell tactic, and allowed them to drive away in their new vehicle without returning to the lender in advance.

Thus, a CX initiative impacted the nature of the service/product (a blank check was added), the process (avoidance of a trip back to the lender), a much better customer experience (less effort and avoiding the trip to the financial manager’s office), and a boost in business for the lender (fourfold revenue increase). In this case, the CX started with the sales process, impacted the product and service offer, as well as what the customer experienced on their vehicle buying journey.  Understanding the external environment made up of the dealers and competitive lenders along with the customer journey enabled this lender to prevail in several key areas.

27 Mar

Cargill Uses Competitive Intelligence to Sharpen its Global Customer Experience Program

Cargill

One of the ways that Line of Sight Group keeps abreast of key marketplace trends is to attend industry association events. We recently attended an American Marketing Association (AMA) meeting that examined Cargill’s global customer experience model which is deployed to create consistently positive customer experiences despite a wide diversity of customers, products, geographies and markets. This approach is very comprehensive crossing multiple types and channels of customer interactions.  One of the most important aspects of the process was to hold up Cargill’s customer experience to that of its competitors across the board. Knowing how you are doing with your customers is one thing, but to also know this relative to the competitive set is one of the elements that makes Cargill a market leader on a global basis. This is another example of a company committing to understanding its external environment and using the gathered insight to make good decisions.

06 Mar

Bob and Jerry on Competing in Healthcare

BobJerry

For the past several weeks, we have been busily reading the myriad articles and forecasts on Healthcare (HC) trends for 2017. There was even an article about all of the other articles.  With trends like a dramatically changing regulatory environment, continued momentum in HC consumerism, advances moving big data and analytics into cognitive computing and Artificial Intelligence, value management, medical device and pharma innovation, mobility, cloud, security, privacy and so on, 2017 promises to be an exciting and challenging year. Not only are things moving fast, but there are a lot of them and the very foundations of the industry are shifting at the same time. If you are feeling a bit overwhelmed and seeking enlightenment, we offer the timeless wisdom of Bob Dylan and Jerry Garcia to make some sense out of the state of HC.

“For the times, they are a changin’” pretty well sums up the status quo. Thank you, Bob. For organizations competing in the HC space, it is particularly important to examine the increasingly complex and multi-layered external environment and to ensure that strategic plans are up-to-date, refreshed and aligned with the go-to-market initiatives. Leaders may also find themselves in the circumstance of playing offense and defense simultaneously.  Some built-in flexibility goes a long way when there are well funded start-ups seeking to innovate by employing new, simplified business models and established organizations seeking to do some disrupting of their own. No matter where the threats come from or where the opportunities may lie, it has never been more important to listen to what is happening in the market, connect the dots and then convert this into insight that can be acted upon. There are a lot of factors to consider.  Jerry rightly observes, If the thunder don’t get ya then the lightning will.

While most organizations conduct annual planning and align their go-to-market activities to the current conditions, it may not be enough. When in particularly challenging times, we might feel the need to regroup a bit and as Bob points out, “Come in, she said, I’ll give you shelter from the storm.”  Leading organizations monitor their external environments continuously in order to anticipate market changes and make appropriate course changes. There are many methods to accomplish this that involve primary and secondary research, analysis and the pulling of various execution levers.

2017 presents potentially turbulent conditions. With a good and continuous view of the external environment, a sound and flexible strategic plan in place and solid execution, you will be able to navigate and compete successfully in the HC market. As Jerry sang, “May the four winds blow you safely home.”  Good luck in 2017!

22 Jul

Disruptive Forces in Financial Services

Competition in Financial Services has always been intense amongst industry rivals. Increasingly, firms find themselves competing with Financial Technology (FinTech) start-ups going after a selective slice of the market with a disruptive offer.  Many FinTech firms have billion dollar valuations, are flush with cash, and are leveraging low cost, cloud-based delivery models. While incumbent firms have invested heavily over the years in a combination of technology-based infrastructures like ATM networks, branch office makeovers, online services and mobile apps, they still feel vulnerable to the threat of FinTech firms grabbing market share in specific areas like retail payments or online lending.

When clients share these kinds of challenges with Line of Sight Group, our first inclination is to turn our eyes and ears to the external environment and to connect the dots around what is happening, as well as what is likely to happen.  Thus informed, threats and opportunities emerge and become discussion points for the formation of strategic plans and subsequent go-to-market initiatives.  Financial Services firms have a vast array of levers to pull when it comes to competing successfully.  Technology is but one of these levers. Some firms find that their physical locations can be leveraged if they reconfigure them into optimized networks based on the specific needs of their clients.  In some cases, they may opt for a smaller branch footprint but implement Interactive Teller Machines that match a specific financial expert with a client virtually. Other Financial Services firms are partnering with FinTech firms by bringing new offers into these networks and blending them into a portfolio of offers.  Another tactic is to conduct hundreds of controlled tests annually (AB Testing) designed to gauge and measure consumer preferences and to then create new offers based on the results.

Line of Sight Group Financial Services clients utilize a number of methods to listen to the external environment in which they play. Some firms utilize strategic competitive monitoring on an ongoing basis to gather, sort and analyze value propositions, pricing and customer satisfaction levels. Financial Services clients who position large commercial offers utilize Win/Loss Analysis to understand why they win and lose deals. Firms seeking to enter a new market employ a Competitive Landscape Analysis to gauge the status quo and to look for unmet needs before making the move to invest.

By understanding the external environment on a continual basis, Financial Services firms can better navigate the ever changing mix of consumer preferences, technological advances and business model iterations to make good decisions. Technology is important, but rarely the only factor to consider.

08 Jun

Reflections on ATA 2016

Line of Sight Group participated in the American Telemedicine Association (ATA) Annual Conference and Tradeshow held last month in Minneapolis.  The annual gathering focused on telemedicine, digital, connected and mobile health.  The event attracted 6,000 people, had 75 educational sessions and a trade show exhibit hall that featured 300 technology product and service providers.

There were several trends we noted as we spoke with visitors to our booth, attended sessions and roamed the exhibit hall.  First of all, Telemedicine, Telehealth, and the many iterations of “Tele” have moved to the cloud.  As cloud technologies and services have matured and become trusted via advances in security, privacy, reliability, performance, and mobility, there are many options emerging including advanced collaboration and integration offers for attaching/monitoring the vast and growing number of Internet of Medical Things (IoMT).   Some things that were previously disrupted by technology (blood pressure monitors with no connectivity) are now re-enabled by newer technology (a smart phone picture of the device with readings uploaded to the cloud and integrated into the patient’s Electronic Health Record).

Next, we also heard from some attendees who’d attended the event in the past two decades that industry consolidation was very evident.  We heard from people from all across the spectrum who were interested in getting started with various tele-initiatives but were not sure where to start.  This even extended to well-funded firms very focused on one aspect of their business.

All told, we talked to technology providers, device makers, integration firms, compliance specialists, health plans, clinical professionals, members of the media, government officials and more to get a sense of what is happening and where the industry is headed.

Events like this allow Line of Sight Group to listen to the market, observe, interact, engage and make connections. One of the key aspects that our Integrated Strategic Analysis requires is the ability to connect the dots when researching a clients’ external environment to help them grow, protect and focus their business.