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Jul
17

Step -1. Where is it You Want to Go?

“Hold your horses!”, “Putting the cart before the horse.”, “The horses are out of the gate.”, “Like a horse to the barn.”, “And they’re off…”

I am sure most everyone is familiar with most of these sayings.  They all give me the visual impression of strength, speed, and lack of forethought.  Certainly there must be some reason the horse is associated so frequently with just wanting to “take off” and start doing something – like there is energy to spare and it if doesn’t get out it might explode.  Unfortunately, just taking off running isn’t necessarily the most optimal approach to choosing a path – unless of course you are faced by a pack of wolves and you are in a purely survival situation!  Taking a step back, assessing where you are, what the options are, and where you want to take that first step, well that seems quite prudent, especially if you plan to start running at some point!

Many times, the first task of the journey is to choose the next destination (if not the ultimate destination).  “All paths are equal if you have no destination in mind” and “You can’t get lost if you don’t have a place or a time to be there” are truisms that echo in my ears from my father’s wisdom.  Thus, I have come to appreciate one of the simplest, but quite possibly most powerful, of business tools – the 2×2 customer vs. offerings portfolio matrix.  Quite simply, it is a 2×2 table with Existing Customers and Existing Offerings in the lower left and New Customers and New Offerings in the upper right.  This simple visualization tool gives you the chance to consider existing and potential customer and offering in relation to each other.  Ultimately there are four primary growth scenarios to consider:

Customer/Offering:

Existing/Existing – Existing customers and existing offerings.  Many times there is plenty of growth opportunities cross-selling, up-selling, and better servicing your existing customers.  Consider that you have already done the hardest work to get these customers to trust you to deliver something for them.  Future posts pertinent to this growth quadrant – Referral growth, Customer assessment, Rewarding good customers.

Existing/New – Existing customers and new offerings (products and/or services).  Incrementally more challenging than servicing your existing customers with your existing offerings is adding new services to offer to your existing customers.  Depending on the investment in the new services, this could quite easily be listening to your customers’ pain points and offering to sell them what they want to buy.  This does however come along with adding support throughout your systems for the new offering – in certain cases this can be quite extensive.  Future posts pertinent to this growth quadrant – Low hanging fruit, Listening to pain points, Surveys are marketing events.

New/Existing – New customers and existing offerings (products and/or services).  Incrementally more challenging than adding new offerings for your existing customers, or growing existing customers with existing services, is acquiring new customers from scratch.  The biggest investment in this growth strategy is time to build trust in the relationship and overcome the inertia of securing the first purchase.  One mechanism that lower the effort and energy to make this strategy more accessible than even new offerings is to leverage Referral customers to either directly recruit or provide testimonials to other desired customers.  Future posts pertinent to this growth quadrant – Mobilizing referrals, Choosing your targets wisely, What are the real costs of new customers.

New/New – New customers and new offerings (products and/or services).  Considered the hardest and most expensive growth strategy (but often times also considered disruptive) is using the New/New move directly from Existing/Existing.  Typically the growth actually happens as a quick move through either Existing/New or New/Existing rather than directly to New/New.  The expensive parts of this transition require adding new customers and new offerings simultaneously and addressing issues with both customer expectations and system requirements to make it all come together, profitably, and with pleasing results.  Future posts pertinent to this growth quadrant – New/New betting the farm, What were they thinking, Hail Mary!

In many discovery sessions it has been interesting to find that leadership teams haven’t really examined exactly where they are currently before deciding on where they want to go.  Add to the challenge of choosing the appropriate growth strategy the lack of clarity of who the “best” customers are, who the “desirable” customers are, and what the relative level of effort is going to be required to go in any direction.  Typically, it seems as though everyone believes they agree on the same “truth” and are working towards what they believe is a common “vision”.  However, the fruitfulness of such a simple business tool as the portfolio matrix in exposing differences in perception, reality, and alignment can not be fully appreciated unless you have sat with a team and gone through many hours of reviewing the portfolio on its merits only to realize that there was plenty of growth opportunity in what you already have, you just have to take that first step – make sure you know where you are stepping!


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