Mitt Romney Was Right!!!
Each of us knows one of those people, a person who continually repeats the same destructive behaviors and suffers from the (very predictable) results. Whether it’s an attraction to a guaranteed-to-explode romance or a series of failed memberships at a gym, people follow the same patterns in spite of repeated failure.
Each of us knows one of those companies, a company that continually repeats the same destructive behaviors and suffers from the (very predictable) results. Whether it’s an addiction to large accounts with low margins or a penchant for spreading resources across too many one-off projects, businesses follow the same patterns in spite of repeated failure.
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Mitt Romney was right. Corporations are people, my friends.
Just like our friends who continually attract a specific type of partner, our companies attract a specific type of customer, or employee, or vendor. Through culture or reputation or business practice—or all three—we make ourselves most attractive to specific audiences and less attractive to others.
As we analyze our customer lists, we might find ourselves over-weighted with large companies, small companies, tech laggards, slow payers, early adopters, strategic thinkers or bottom feeders. Some of these are the clients we want and some are not, but it’s clear we are sending out messages to attract all of them.
Obviously, we could increase our success rate if we sent out the messages that attract only the clients we want. We’d make our companies more profitable, sustainable and defensible if we fine-tuned our approach to emphasize the actions that yield desirable results.
That’s why the search for A-List customers is so critical for sustainable growth. If a company’s client base is not populated solely by A-Listers, it’s a sure bet that the company is sending out signals that attract both desirable and not-so-pretty prospects. If we want to improve our performance over the long term, we need to focus on those signals that draw the A-List clients and minimize our pursuit—intentional or otherwise—of the also-rans.
In almost any business, some group of clients is producing more than 100% of profits, while other clients are proving to be a drain on earnings. If there’s any pattern to the makeup of the D-List accounts—and usually there is such a pattern—the conclusion is both starkly challenging and irrefutable: The company is actively investing management bandwidth and marketing dollars to attract unprofitable accounts.
Most corporations, like most people, will chalk up the losers as one-offs or unforeseeable situations. Most corporations, like most people, will repeat the actions that attract new one-offs and unforeseeable situations. And most outside observers, unlike the people in the middle of the muddle, will recognize the patterns as they unfold quite predictably.
How much are you spending to gain clients that hurt your business? How much more successful would you be if you spent the same money to draw A-Listers? And how many headaches would you avoid if you stopped jumping through hoops to keep customers that you shouldn’t be serving in the first place?
When you find the answers to these questions, you uncover the path to success.
About Michael Rosenbaum
Quadrant Five founder Michael Rosenbaum has walked the walk when it comes to building a business, so he can be a confidant and compatriot—not just an advisor—for clients. Rosenbaum worked his way up to president of a $35 million company with 300 people and 600 clients. Along the way, he managed operations, HR, IT, and marketing, and advised CEOS and CFOs at more than 200 companies.
Beginning as a newspaper reporter, he developed a specialization in business journalism and earned an MBA on his way to a 30-year consulting career. Representing both angel-backed startups and Fortune 100 giants, Rosenbaum identified the patterns and processes that drive success across a wide range of industries and business cycles.
He is well regarded for designing each performance-improvement process around specific client needs, capabilities, and culture, rather than pushing a pre-fab set of rules for clients to follow. He brings a unique set of skills to each engagement, including experiences as a company president, financial journalist, marketer, IR advisor, non-profit founder, author, and public speaker. Items of note include:
• Received the Order of Merit of the Republic of Poland in 2015 for non-profit work
• Honored for the Best Business Biography of 2012 for his fifth book, Six Tires, No Plan
• Frequent speaker on customer relationship value
• Sales instructor for Certified Value Growth Advisor certification program.
• Regional Communications Chair, YPO Gold
• Marketing Chair, AMAA’s Mid-Market Alliance
• Former Chicago Chapter Chair, National Association of Corporate Directors
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