During economic uncertainty: build your differential capability

With the current economic crisis – will your customers stick with you?
When the economy picks up again – will your star project managers leave for greener pastures?
How do you entice both your customers and your key staff to stick with your organisation through thick and thin?

The answer is to build your differential capability.

So what does the term ‘differential capability’ mean?

It’s how people distinguish between two things (for example service providers) that are similar but not the same – by comparing the actual capability to deliver in vital areas and looking for the one that consistently stands out from the crowd. So not merely what the glossy sales pitch promises! Rather what has previously, is currently, and will be delivered – the ‘proof of the pudding is in the eating’ as the saying goes.

For example, if you’re new in town, how do you choose where to buy a morning coffee? You might look for the brand of beans, how close it is to your office, how long the line is, if they offer skim milk. In other words, your external assessment from what’s on offer. You try a few other places as well. But what would entice you to go back again and again to the same coffee shop? Maybe great coffee, smiling staff, efficient service, free tastings and they open early. It was your actual experience of the product and the service, at a consistently high level, that distinguished them from the other coffee shops. Their differential capability – their ability to stand out from the crowd, first time, every time.

Your company

Wow, tall order (no pun intended!) So how does your organisation measure up? Are your projects delivered on time, on budget, to scope? (new coffee shop opened on schedule, for $200,000 fit-out, with full kitchen, seating for 30 and certified baristas). Down the track, do your loyal customers not even notice that there has been a change behind the scenes (upgrade to a new technology coffee machine, which everyone knows how to use), because there was no interruption to their daily routine (large skim latte, with a smile, caffeine to help face the early morning meeting)?

So, how do you ensure your company stands out from the crowd? Firstly, understand your company’s key differentiators from your competitors. For example, your outstanding customer service and your well managed implementation services. Make sure it’s what your customers say makes your organisation different, not what you internally think. (That could be surprise!) Look for the things your customers compliment you on.

Your Customers

In this economy, you can’t afford to lose customers. So that means you can’t afford to let what makes your company different gradually slide down from outstanding into average or worse. This will simply give your current clients a reason to contemplate or even try alternatives. The focus must be on enhancing the difference, standing out from the crowd even further. This is investing in growing your organisation’s differential capability, investing in your company’s ability to ride the current dip in the economic wave.

Your people

Now, how do your staff support your organisation’s differential capability? A big part of what makes your organisation stand out in the crowd is likely to be your staff. They deliver the products and services to your clients. So it’s crucial that they have the required skills and proven competencies to perform at the desired level (chances are you’ll know if your coffee is made by someone not trained as a barista!)

Given the economic climate, recruitment as well as learning and development are likely to come under closer scrutiny. Rather than react with a random slash and burn mentality, analyse where training and coaching will enhance your organisation’s differential capability and focus your time, effort and dollars there. Ensure your justification for any expenditure is directly linked to enhancing your organisation’s differential capability, with clear commitments on how the benefits will be measured, monitored and delivered.

Perhaps you are faced with a recruitment freeze, while still needing senior project managers (or baristas!) A viable alternative is to look for middle level project managers or performers in similar roles, already within the organisation and provide them with initial training and coaching from an experienced project management coach. If you do the sums, this is a cost effective way to enhance their existing skills and stimulate their growth into senior project managers who know your company. And provide major value to the organisation.

This approach works equally well to grow operational staff (wait staff) into junior project manager (junior barista) roles. The project management coach mitigates the risk of throwing new project managers into the proverbial deep end to see if they sink or swim. Remember if they sink, they take the project with them to the murky depths!

Other thoughts

It’s also crucial to hang onto the star performers, to give them an incentive to stay with your company when the economy picks up again. If you have looked after your staff in the bad times, they will remember. We’ll further explore building your organisation’s differential capability from an employee perspective in the April newsletter, so keep an eye out for that. In the meantime, enjoy a coffee or two!