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Advice |
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For
little companies, big ideas are a must |
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Q: We’re
an outsourcing start-up that wants to break into the
United States and European markets. But the big companies that could be our clients
won’t even talk to guys like us. How do we get them to at
least hear our proposal? Ram Muthiah,
Seattle, Washington
A: By
changing the game. In a nutshell, that’s what it takes for
a little service company like yours that’s dying to break
in to get the attention of the monster companies. Most of
the time, those companies are so bureaucratic and
risk-adverse—and their buying operations so tied to the
tried-and-true monster suppliers—you can’t offer any form
of marginal improvement to get in the door. You’ve got to
make an offer they can’t refuse.
Sure, the
entrenched competition will be out there making killer
offers, too, and with track records to prove they can
deliver. To make matters worse, your competition’s sales
teams have probably worked for years to develop personal
relationships with the key players inside each customer’s
buying operation, shepherding them through more “special
events” than you could count. In other words, your
competition has made itself the devil they know.
Which is
why you have to do something radical. You can’t get a
contract by offering a somewhat lower price or somewhat
faster delivery. The first time out, there’s just no
reason for the buyer to risk his reputation by believing
in you for that kind of payback.
Rather,
you have to buy your way in the door with a transformative
value proposition with almost zero risk attached.
Essentially, you have to make it seem dunderheaded not to
do business with you—it’s a no-lose proposition.
Case in
point is the Indian outsourcing business Wipro. Starting
in the late 1980s, it came seemingly from nowhere to
wiggle its way around the established technology-service
providers and into the hearts of big customer after big
customer. Its modus operandi was to offer something
outrageous—significantly higher quality with a massively
lower price—and then over-deliver on that promise by
orders of magnitude. It was stunning, and the buyers who
went with them very quickly looked like heroes in their
organizations. No wonder it took only a couple of decades
for Wipro to grow to a $3-billion global operation with
nearly 80,000 employees.
Similarly,
in its early days in the mid-1970s, the consulting firm
Bain & Co. told potential clients, “You don’t need to pay
us very much up-front. Down the road, just pay us a
percentage of the additional profits our recommendations
are sure to earn you.” With that kind of upside-only
proposition, it’s not surprising that Bain was able to
gain a foothold in an industry that was already
overcrowded with brand-name firms.
Along with
their almost too-good-to-be-true value propositions, both
Wipro and Bain possessed a second critical quality that
won them clients in their start-up days, and that was
fire. Their sales representatives may have been
well-educated engineers and MBAs, but the best of them
still displayed a certain religious fervor about the
unmatched value their company could deliver. Their
presentations would leave behind converts, who wouldn’t be
saying, “Hmm, interesting,” as in the typical postmortem,
but: “Did you see the way those people believe in
themselves? Did you see the fire in their eyes? They make
me believe, too.”
So, not
easy—but there are your marching orders. If you want the
big guys to “at least hear your proposal,” as you put it,
the promise of your proposal has got to blow them away,
with an outsize upside and minimal downside. And once in
the door, you have to blow them away again, with your
passion. Together, that’s the foundation upon which
winning enterprises are built.
Q: I am
an information-technology consultant who makes $300 an
hour at my firm. A customer has offered to pay me $1,000 a
day to moonlight for them on the occasional weekend.
Should I take it? Name Withheld,
Houston
A: Here’s
the only answer to your question: Ask your boss. That’s
the only way to get clear on your company’s policies
regarding outside work and to do the right thing by them.
After all, ethical decisions must always be transparent.
Your
question, however, raises another point, and it’s for
leaders. No company, regardless of its size or business,
should be without some kind of safety valve that allows
employees to ask about quandaries such as this one. It can
be a confidential ombudsman, an anonymous tip line or
whatever method works best. The last time you want your
people to feel alone is during an ethical dilemma.
*****
Jack
and Suzy Welch are the authors of the international
bestseller Winning (Collins). Their latest book is
Winning: The Answers: Confronting 74 of the Toughest
Questions in Business Today (Collins). They are eager to
hear about your career dilemmas and challenges at work and
look forward to answering your questions in future
columns. You can e-mail them questions at winning@nytimes.com.
Please include your name, occupation, city and country. |
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| OTHER STORIES |
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The Puno
court and the two remedial scalpels of amparo and habeas
data |
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Generations of law students and lawyers, many of whom are
now prominently serving in the Judiciary, are familiar with
the landmark case of US. Bustos, G.R. No. L-12592, March 18,
1918. |
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read more |
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Office
landlord |
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WILLIAM
Willems operates his office—all 950 of them in 400
cities—with a thin gilded plastic sheet the size of a credit
card.
“This is
what I call an upgraded Starbucks principle,” Willems told
the BusinessMirror, flashing the 3-inch by 2-inch card
embossed with his name. |
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read more |
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Winning:
For little companies, big ideas are a must |
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Q:
We’re an outsourcing start-up that wants to break into
the
United
States
and European markets. But the big companies that could be
our clients won’t even talk to guys like us. How do we get
them to at least hear our proposal? Ram Muthiah,
Seattle,
Washington |
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read more |
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How to
manufacture a global food crisis |
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WHEN tens
of thousands of people staged demonstrations in Mexico last
year to protest a 60-percent increase in the price of
tortillas, many analysts pointed to biofuel as the culprit.
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read more |
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The best
advice I ever got |
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In the
summer of 1982, I worked for Donald Regan, then the US
secretary of the treasury under President Reagan. I was
about to go into my final year at Wharton and, having worked
many summers at Estée Lauder Companies since age 13, was no
stranger to office life. But in this role my title was
“special assistant to the special assistant”—not what I had
anticipated. |
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read more |
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Leading
an innovation review |
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Innovation
is fraught with uncertainty. Is the timing right? Will the
consumer buy the product, and then buy it again? Will the
technology work at the right price? The sad fact is that one
can do everything right and still get it wrong—and this
reality must be reflected in the review process. |
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read more |
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Hurd mentality |
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WITH
electronic chips competing for grain as the commodity of the
computer age, it pays to have a salesman at the helm.
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read more |
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winning:
Keeping one’s eyes on the future prize |
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Q:
What are the big concerns confronting business in the
next 10 years? Fatma Abdullah, Dubai, United Arab
Emirates |
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read more |
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More
mouths to feed |
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Ask
Josephine Gonzalez how many children a family should have
and the stick-figured 31-year-old mother answers without
hesitation. “I only wanted three,” she says, trying to
soothe the naked baby boy who tugs at her ragged dress. |
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read more |
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Philippines feels the pinch of dollar’s decline |
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The US
dollar has always been king down by the docks on Manila Bay,
where Philippine seamen congregate to swap stories and look
for work. |
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read more |
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10
reasons why electricity bills are high |
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Note:
After Manila Electric Co. (Meralco), the country’s largest
electricity distributor and supplier, announced in April an
increase in its generation charges by 51.88 centavos per
kilowatt-hour (kWh), rumors of a brewing government takeover
began spreading like wildfire. |
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read more |
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Working
in the gray zone |
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Using
company resources to work on personal projects, especially
on company time, is a no-no for employees in most
organizations. But supervisors often operate in what I call
a gray zone, turning a blind eye to such officially
forbidden behavior. They realize that stamping it out may do
more harm than good, because many employees have a
deep-seated need to engage in it. |
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read more |
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Creating
the conversations that create innovation |
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One of the
great myths of innovation is that breakthrough ideas are
produced solely by intuitive individuals or by small
creative teams working in isolation. The reality is that
whether we think of Thomas Edison, Ted Turner, Jeff Bezos or
Steve Jobs, most well-known innovators developed their
breakthrough ideas as a result of interacting with a rich
and diverse community of people. |
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read more |
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Fun
revisited |
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Thirteen
years after he created the 17-hectare Enchanted Kingdom in
Santa Rosa, Laguna, designer Gary Goddard has once again
returned to the theme park he originally imagined. |
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read more |
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The
Modern Leader |
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‘People
don’t want to be managed, people want to be led.” |
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read more |
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Winning: Before taking the plunge, get all the details |
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Q:
I’ve been in my job for six years, but there’s very
little runway for me here. Last week, a business
acquaintance offered me a job at his company. It’s not
really my area of expertise and the position is somewhat
unclear, but it seems exciting. Do I go for it? Name
Withheld, Wayne, Pennsylvania |
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read more |
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The Rice
Cop |
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There are
moments during these days of worry over soaring
international food prices when it appears that Philippine
President Gloria Macapagal-Arroyo is out to solve her
country’s rice shortages on her own. |
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read more |
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Rice’s
price rise takes a toll in Manila slum |
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It is in the
heaving slums of
Asia, amid
sagging tin shacks and streets afloat with waste, that the
soaring global price for rice hits hardest. |
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read more |
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Look to
the Sky |
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ALFRED M.
Yao is a man who rarely rests.
He says
the last vacation he had with his entire family was two
years ago in New Zealand, and remembers a few regional
cruises with his wife. He tells the BusinessMirror he would
rather be on his toes, working, on the lookout for new
business opportunities. |
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read more |
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The Best
Advice I Ever Got |
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Shortly
after joining Salomon Brothers in 1975, I had an opportunity
to rescue a troubled account. Our firm was getting almost no
business from one of our huge institutional clients, but I
made some headway and surprised everyone, including myself.
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read more |
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Using
conflict as a catalyst for change |
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Deep
organizational change inevitably produces conflict. Those
who lead change usually try to suppress conflict, with the
goal of keeping the energy positive and the forward momentum
strong. |
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read more |
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Law&
property |
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Talk about
having the right address.
That’s how
Atty. Andres D. Bautista, chief executive officer of the
Kuok Group in the Philippines, was initially considered to
become the Hong Kong-based group’s top guy in the
Philippines. |
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read more |
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Winning:
When the chips are down, keep your chin up |
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Q:
Our company, like many these days, is experiencing lower
earnings and the termination of many good employees. How do
we build morale and give employees some sense of confidence
in the face of poor financial results? Name Withheld,
Maryville,
Tennessee |
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read more |
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From
farms to tables |
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Governments serve the secondary purpose of intervening when
free markets come perilously close—or are perceived to be
close—to losing control. |
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read more |
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Food-Price Shock |
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The
globe’s worst food crisis in a generation emerged as a blip
on the big boards and computer screens of America’s great
grain exchanges. At first, it seemed like little more than a
bout of bad weather. |
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read more |
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Take the
lead at your next review |
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The
management literature is full of advice for those who want
to deliver effective performance reviews. The usual mantra?
Use review sessions to set clear expectations and goals but
never forget to praise good work and to listen closely to
employee concerns. |
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read more |
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What you
can gain when you lose good people |
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Knowledge
workers in technology companies generally don’t view their
jobs as being about human relationships. The more
introverted among them would probably even shudder at the
thought. |
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read more |
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