213. Improving Your Firm’s Innovation IQ

Distributors Must Innovate. Most Cannot. The Cure?

Regular readers may sense a theme that threads through my recent: blogs; curated Linkedin posts with comments; and my 12, recorded webinars. The theme? What big innovations are necessary to win at eCommerce 2023 and how to make them happen.

Historical fact: firms don’t do big change, they disappear.

  1. 99% of all companies that ever existed in the US are dead. When big change hits an established industry model, the wipe out-rates are huge.
  2. If an industry need is supplanted by a new technology (e.g. horses lose to motor cars) – only 1% of the firms in the old order reinvent to succeed in the new.
  3. If a new, breakthrough, supply-chain process appears (container shipping; Walmart’s cross-docking; cost-plus unbundled replenishment contracts in retail distribution channels) only 3 to maybe 10% of existing players successfully embrace the new, improved way.
  4. In the absence of industry-wide, big changes, 3-4% of businesses are perpetual innovators within the existing industry paradigm. These “Gazelles” outperform the best-practices herd (the other 90%+). Gazelles grow 2-4 times faster and make 4-6X the ROI.

Elements for Achieving Big Change?

  1. Vision: see and accept the reality of the need for change. The first three of my webinars address the big changes occurring and what distributors must do: webinarsC19” plus #1 and #2.
  2. Specific model innovations: Someone will give the B2B buyers the “buying journey” experience that Amazon and others have taught us to want. Manufacturers need to digitally-engage end-users and provide a seamless, best journey. Next-gen buyers want facetime calls only if and when needed. And, 24/7 virtual support as needed. Distributors must re-model to accommodate both sets of new needs.

For more on model innovations see my blogs: #199, 200, 202, 203; and webinars #8 -10.

  1. Fix systematic, losing activity. You cannot afford to invest in innovations while losing money on 20-80% of active accounts. Most are curable. Get cost-to-serve analytics and execute on all of the new insights. (Webinars #3 -7)
  2. A compelling story: to tell all employees (repeatedly!) about the journey ahead and how all will benefit. See my “Core Renewal Roadmap
  3. Boost Curiosity (blog 204). To first, improve your success theories (blog 206). Most executives are only curious about fine-tuning what they know and habitually do. True-new is scary! You are unusually curious to be reading this summation (and this far)!
  4. Update data-free, Old Beliefs. As you process my stuff, objections will arise. Many will be illogical and empty. They are driven by various fears (blog 205). People fight for clinging to the status quo. Defuse fears first with emotional first-aid, then teach new-logic repetitively. (For more, see: http://merrifieldact2.com/e-book/chapter-five/2-reframing-objections/ . And,  http://merrifieldact2.com/e-book/chapter-five/1-39-objections/ )
  5. Solve the biggest universal fear: “My sales force won’t stand for this; some will leave for a competitor and take their business with them”. How to solve this generalized, awfulized, data-free concern is detailed in: webinars #8 -10.
  6. Insist that the Status Quo is unacceptable. It is a most risky, if not deadly path. If resisters don’t like Plan A (“the Roadmap”), then insist they provide a Plan B for: “How will we please both next-gen, digital buyers and fit into manufacturers’ omnichannel moves?”
  7. Start small and focused. Don’t introduce new data and changes across the entire company (read why it fails: blog 182). Get, instead, your intrapreneur(s) focused on one, best, initial experiment with most progressive associates (blogs 145, 148). Get quick wins and trumpet the case successes. Then, work with next-wave, volunteers. Some “key” employees will ultimately refuse to change. Solve each case. Don’t let intransigents jeopardize the future of all stakeholders.
  8. And, for more change management tools and guidelines, see: webinar #11.

CONCLUSION

Will you get to the digital future better than 80 to 90% of legacy competitors? If you think you can or you cannot, you are right.

With new analytics, insights and baby-step experiments your courage (and then confidence) will grow quickly. Let’s do it together! For more help, be in touch at: bruce@merrifield.com

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