8 steps to creating B2B products your customers will love

Posted by Mark Brousseau

There’s a famous quote from Henry Ford that Steve Jobs has been known to cite: “If I’d have asked my customers what they wanted,” Ford reportedly said, “they would have told me ‘a faster horse.’” Yes, it reflects a bold product development philosophy. And this closed-door, tell-customers-what-they-want-even-if-they-don’t-yet-know-it approach works well for our modern day King of Innovation (and his development team at Apple, of course). But if you’re tempted to adopt the Jobsian method yourself, Dan Adams urges you to think twice.

“Don’t start wearing black turtlenecks and imagining your blockbuster new product just yet,” advises Adams, author of New Product Blueprinting: The Handbook for B2B Organic Growth and founder of Advanced Industrial Marketing.

“The reality is that the average new product success rate—once the costly development stage begins—is only 25 percent,” he adds. “Generally speaking, for those of us who aren’t Steve Jobs, the practice of developing new products first and then waiting to see if customers buy them is a terribly inefficient use of resources.”

For B2B suppliers, in particular, Adams extols the virtues of first understanding market needs and then developing supplier solutions to meet them. In fact, his New Product Blueprinting—packed full of very practical methods, skills, and tools that have been finely tuned on six continents and in hundreds of industries—centers on this “ask before you innovate” philosophy.

“The good news is that you can conceptualize products you know your customers need before spending a bundle on development and launch,” explains Adams. “And even more good news, this approach does not prevent you from developing exciting, breakthrough products. What’s more, it’s unlikely your competitors are using this approach today, so your competitive advantage can be enormous.”

Here are the key steps to becoming a new product mastermind in your own right:

Remember, Steve Jobs deals in consumer goods—a whole different ballgame from B2B products. In describing his iTunes development team, Jobs said, “The reason that we worked so hard is because we all wanted one. You know? I mean, the first few hundred customers were us.”

In contrast, points out Adams, when DuPont developed Kevlar, they first experimented in applications such as tire cords. They went 10 years before implementing the first field trial in protective body armor, which ultimately became their main market. If you’re selling to other businesses, it’s unlikely you know enough about your customers’ worlds to hit the nail on the head with every product you develop for them.

“Unlike Steve Jobs, who can create successful products based on what he knows he wants and what his Apple employees want, you have to ask your customers what they want,” says Adams. “Otherwise, you risk spending tons of time and money on a product that you think is great, but that ultimately elicits a sleepy yawn from your customers.”

Compare your IQ (Innovation Quotient) to Steve’s and act accordingly. There’s no doubt that you and your team are smart. And in fact, you and your development team may just be as smart as Jobs and his team. But it’s unlikely you’ve worked as hard for as long at mastering the skills needed to develop blockbuster products.

“Just because Reinhold Messner—one of the world’s greatest mountain climbers—makes a solo climb of Mt. Everest without supplemental oxygen, doesn’t mean you can,” notes Adams. “But with training, oxygen, the right team, and an easier route, you might still enjoy the same view. My point is, if you want to win in the marketplace, tip the scales in your favor. Why not avoid unnecessary risks when you can?”

Because these risks can be costly. During a time period that Jobs was absent from Apple, the company had its share of new product flops. You might recall the Newton MessagePad. Or how about the Apple Bandai Pippin, the gaming console technology created by Apple, or Cyberdog, the Internet browser Apple created back in the late ’90s?

“Sure, it would be great if your next three products were MacBook, iPod, and iPad,” says Adams. “But if they are Newton, Pippin, and Cyberdog, will you still even be working at the same company?”

Learn how to attack the right market. When Apple develops a new product for the global consumer electronics market, it can be assured it is pursuing a market that is large, growing, and open to change. Unfortunately, it’s possible—and all too common—for B2B suppliers to pursue far lesser markets.

“If you make adhesives, they could be used in window construction, aircraft interiors, solar panels, and so on,” notes Adams. “Smart B2B suppliers focus their scarce resources on just those market segments with the best prospects for growth, adequate size, reasonable competitive landscape, and so on. You can learn much of this information by doing solid secondary market research. But you often need to spend time interviewing customers in potential market segments as well. Sometimes you’ll find an ‘over-served’ market that is looking only for lower pricing. That’s a good time to ‘bail’ and pursue a different market.”

Uncover customer outcomes. Steve Jobs makes a good point when he says you can’t just ask customers for “the next big thing.” But the next big thing is the “solution,” which is supposed to be the supplier’s area of expertise. The customer’s area of expertise is the “outcome”—what they want to have happen or what they want a new product to do for them. They don’t know how to make it happen. They just know they need it to happen. When you find out what kind of outcome your customers want, you can provide their solution.

“Knowing that these are the outcomes his customers wanted, what kind of products should he develop?” says Adams. “Perhaps something that looks like iTunes and the iPod. I use this made-up scenario to illustrate how the outcomes you hear from your customers might translate into new products. Once you know what outcomes your customers want, you can begin to develop a product that delivers them.

“Research shows there are 50 to 150 customer outcomes for every job your product is hired to do,” he adds. “And the reality is that talking to customers and uncovering these outcomes actually helps your team be more creative. For example, it’s likely your customers will reveal an outcome they need that you and your team might never have thought of without their input.”

Don’t “just ask” customers. When you ask customers for their outcomes, get creative. You need to really get your customers thinking and talking. In-depth. One- or two-sentence answers will rarely give you the information you need—and that’s what you’re likely to get unless you know how to probe.

“You can encourage customers to dig deeper using interview methods similar to those we developed at Advanced Industrial Marketing,” says Adams. “For example, we have special ‘trigger methods’ to get them out of mental ruts. We have fresh ways for probing their responses. And we have unique observation and customer tour tools to let you see exciting new opportunities.

“When someone says, ‘Don’t just ask customers what they want,’ it doesn’t mean you should isolate yourself deep within the bowels of your company to guess what they want,” he adds. “It means you should get innovative about ways to enter your customers’ worlds and understand the needs they cannot easily articulate on their own.”

Prioritize customer outcomes. What will customers richly pay you for? Only for delivering outcomes that are important and currently unsatisfied. That’s why Adams advises clients to get quantitative—to ask customers to rate how eager they are for certain elements of a new product. For example, you might ask on a scale of 1-10 how important it is to “search for a broad range of music.” Then ask that same customer to rate, on a scale of 1-10, how satisfied they are today with their ability to “search for a broad range of music.” Then focus your product development on outcomes that scored high in importance and low in current satisfaction.

“Most suppliers fail to ask these quantitative questions,” says Adams. “The result is they miss two critical points: The first is that it’s a mistake to let your engineers and scientists work on answers to questions customers don’t care about; secondly, to a certain extent, we all ‘hear what we want to hear’ in customer interviews, so quantitative data is needed to drive out internal bias and wishful thinking.”

Take advantage of the profit motive. Many B2B suppliers completely overlook an enormous advantage they have over consumer-products companies such as Apple: the ability to measure value delivered to their customers. How do you measure the “coolness” of a tiny iPod, the convenience of a fast music download, or the bragging rights of owning the latest iPhone model?

But the B2B supplier’s world is different. “I’ve helped B2B suppliers in hundreds of industries,” says Adams, “and their customers are usually in the business of making money. B2B suppliers can help their customers make more money by improving their processes and/or their products. If suppliers are willing to work at this, they can often measure or predict how a new product will let customers a) reduce costs, b) sell higher volumes, or c) sell at higher prices.

“Tools such as value calculators allow attentive B2B suppliers to understand the value their customers will receive from their new product,” he adds. “This teaches the supplier how to precisely ‘tune’ the design of their new product, how to price it, and how to promote it. This may not be as much fun as a new touch-screen phone, but it’s great for the supplier’s bottom line.”

Get creative with the solutions. Truly hearing the voice of the customer is necessary, but not sufficient. Here’s where you can and should emulate Jobs and his team at Apple—in the creativity department. Jobs doesn’t just encourage innovation; he requires it. He wants Apple employees to take risks, give feedback, and constantly think outside the box. Basically, creativity is a must.

“Once your team knows the outcomes customers care about, they need to focus all their creative energy on finding the solutions that result in those outcomes,” says Adams. “This is best done by engaging as many of the right minds as possible. But remember, this often means engaging those who work outside your company.”

“I leave you with a sort of caveat,” says Adams. “The new product development process that I’ve laid out might look neat and orderly, but in fact, it is often like a messy kitchen as the meal is being prepared. It won’t be unusual during the process for your scientists to invent great new technology before finding a home for it—think Post-it Notes or ScotchgardTM. Do you just leave those products quivering on the lab bench since customers didn’t ask for them? Absolutely not.

What do you think?

NACHA's Wheels

By Mark Brousseau





NACHA's Pay It Green sport utility vehicle (SUV) at its Payments 2011 conference last week in Austin, Texas.

No end in sight to paper checks

By Mark Brousseau

While the Federal Reserve Bank’s latest figures show that electronic payments continue to achieve strong growth, the data also suggests we’re still a long way off from the eagerly-anticipated “checkless” society.

With 28.8 billion checks written in 2010 -- the last year the Federal Reserve researched -- the number of checks written between 2007 and 2010 declined by about 6 percent per year. What’s more, 92 percent of checks are now cleared electronically between U.S. banks, according to the Federal Reserve’s research.

So what should remittance processors make of this data?

“It’s clear that U.S. check volumes continue to decline at a gradual rate,” says Creditron Founder and CEO Wally Vogel, “But checks are not likely to disappear any time soon.” While those might be sobering words from some paper-weary operations managers, they can take heart in the fact that paper deposits – a drag on costs and efficiency – are experiencing a rapid decline as Check 21 emerges as the method of choice for deposits (Vogel points to NACHA figures showing a big drop in Accounts Receivable Check Conversion volumes). “This is bad news for manufacturers of high-volume check encoding equipment, but it’s a great opportunity for providers of Check 21 remote deposit technology. There are many remittance shops that manually process their transactions, or have outdated solutions that don’t support Check 21. With banks continuing to lower their fees for Check 21 deposits, many of these shops will likely look for electronic solutions.”

Vogel notes that Creditron has recently seen strong demand for its Check 21 remote deposit capabilities. “The market is recognizing the value of remittance solutions that offer Check 21 remote deposit, as well as an image-based workflow. Against this backdrop, I think we are well-positioned for success and growth.”

What do you think?

Will Facebook replace the United States Postal Service?

By Flint Lane of Billtrust

Facebook and the United States Postal Service (USPS) are two organizations that have virtually nothing in common. One is a profitable enterprise that Hollywood is making movies about. The other is a government-run organization losing billions of dollars per year. What, if anything, could they have in common?

I've been thinking a lot lately about what's going to happen with the USPS. It's clear that their business model is broken and without an act of Congress, literally, they'll just continue to lose billions each year. I don't blame the folks that run the USPS, they work hard, but they're stuck with a business model that just doesn't work.

When I do the Billtrust sales pitch for electronic billing, it usually goes something like this: "How much sense does it make for a biller to take an electronic billing feed, print it on paper, put it in an envelope, mail it to me so I can then attach a check and mail it back?" Sounds pretty stupid, right? Well, why are the majority of bills still delivered via the USPS? The answer is actually pretty simple; it's still the only mechanism that can reliably reach everybody.

Below I lay out what a new "electronic post office" has to have in order to replace the USPS and why I think Facebook could easily position themselves for this.

1. Universal Deliverability - Facebook claims 150 millions active US users today and growing rapidly. While certainly not universal, they're certainly getting there with the ability to reach the majority of Americans.

2. Effective Communication Platform - Facebook falls short here quite frankly. Posting a status update is interesting and a great way to stay in touch with friends, but Facebook, in my opinion, has fallen on their face as a communication tool. What Facebook really needs here is a GMail like email interface so that people/businesses could send stuff to your @facebook.com address. Now this certainly would introduce enormous spamming opportunities. Facebook could impose some kind of insignificant email tariff to prevent rampant abuse. I've blogged about this in the past (here). I know most people think they get a lot of paper junk mail, but there is actually an effective tariff in place to limit this, it's called postage. I wouldn't mind receiving some junk email if they went through a system that actually had some controls in place. Charging $0.001 per email wouldn't be unreasonable and would keep out the blatant spammers.

3. Privacy - I don't get myself too worked up about my online privacy because I think the measures that most companies take are far more effective than the offline world. However, there are certainly opportunities for abuse here. I would suggest taking a portion of the tariffs collected from above to pay a third party to monitor privacy on a regular basis.

4. Payments - The majority of mail that people get, that is of any importance, are bills. That's because they require the user to take an action - return a payment. Facebook doesn't have this today but this is not a big effort.

Other have tried to become the universal mailbox. My first company Paytrust did this for bills. Zumbox and EarthClassMail are trying to do this for all other forms of mail. But all three suffer from the chicken and the egg problem. Which is to say that until they have enough users, billers and other mailers don't want to bother enabling electronic delivery to them. And users won't sign up, until they can get a majority of their mail through the channel.

That's why I think Facebook, if they want, is well positioned to do this because they already have the user base. Economically I think it would be a slamdunk. Who else could do this? Maybe Google with GMail but I like Facebook's chances better.

New NACHA rule will streamline remittance processing

By Mark Brousseau

Hoping to make automated clearing house (ACH) processing more appealing to businesses – especially smaller ones – NACHA is doing away with its outdated opt-out provisions for Accounts Receivable Check (ARC) Conversion and Back Office Conversion (BOC) transactions.

The new rules, which will be effective March 18, reverse a longstanding policy that requires billers and merchants to let consumers choose not to have their checks converted to electronic debits. Merchants and billers will still have to give notice to customers that their checks will be converted.

NACHA sees the rules change as particularly important as smaller merchants and billers look at adopting ACH payments as an alternative to remote deposit capture (RDC), which allows businesses to create images of checks and deposit them electronically to a financial institution.

With ARC, billers are able to convert paper checks they receive from consumers at designated lockboxes into electronic transactions. With BOC, merchants can batch consumer checks throughout the day and convert them later—typically, in a back office rather than at the point of sale—into electronic debits. While ARC and BOC opt-out rates have been marginal, typically running well under 1 percent of all consumers, the handling of these exception items was a big hassle for billers.

“This is a step in the right direction for businesses,” says US Dataworks Product Manager Leilani Doyle. “Businesses no longer are required to offer opt-out indicators on their remittance documents or worry about honoring an opt-out provision, if they don’t want to. This simplifies remittance processing. But the fact is, a miniscule number of opt-outs have been requested since the ARC rule was introduced. And, consumers are only becoming more comfortable with electronic payments.”

What do you think?

10 Habits of Highly Effective Managers

By Wes Friesen, Portland General Electric

“Sow a thought and you reap an act; sow an act and you reap a habit; sow a habit and you reap a character; sow a character and you reap a destiny.”

Right in the middle of the quotation above is the importance of our habits. A habit is “an acquired mode of behavior that has become our common practice.” Our habits mold our character and ultimately determine our destiny in the world. Want to further develop your character and develop in to a highly effective manager? Intentionally pursuing and building worthwhile habits is the key.

Following are ten of the habits of highly effective managers. This is not an exhaustive list – but these will build a strong foundation on your road to increased management effectiveness:

1) Habit #1: “Expanding Self-Awareness.” Having a high level of Emotional Intelligence (EQ) is essential to being an effective Manager – and EQ starts with having accurate self-awareness. Self-awareness can help us gain self-control and be helpful to people around us – not hurtful. Some tools to help expand our self-awareness include: get feedback from others such as using 360 degree surveys; have a mentor to speak into your life; and constantly seek feedback from others on how we are doing.

2) Habit #2: “Pursue Continuous Learning and Continuous Improvement.” Are you a perfect manager and person? Me neither! What we can do is to commit ourselves to be like-long learners and seek to continuously improve ourselves as managers and as human beings. I have been inspired by this quote from Dr. Martin Luther King: “I may not be the man I want to be; I may not be the man I ought to be; I may not be the man I can be; but praise God, I’m not the man I once was.”

3) Habit #3: “Always do the Right Thing.” Too many people have been victimized by the unethical behavior of those in leadership roles. Remember Enron? My co-workers and I at Portland General will never forget – we were owned by Enron at time of their bankruptcy and our retirement savings were decimated. Mark Twain said “Always do what is right. It will gratify half of mankind and astound the other.” My former pastor Loren Fischer said “it’s always right to do right” – and I agree.

4) Habit #4: “Be Results AND Relationship Oriented.” As leaders we are expected to get results – and we should. At the same time, building positive relationships is the right thing to do – and it leads to great results. One tool to help build relationships is to consistently practice the 3 Rs with people. Recognize people for who they are and what they do; Reward people for individual and team achievements; and show people Respect – everybody wants to be respected as the classic Aretha Franklin song emphasizes.

5) Habit #5: “Achieve Big Goals one small step at a time.” I remember a grade school friend telling me the following riddle: “Question: how do you eat an elephant? Answer: one bite at a time”. Get the point? We need to set long-term visions and big goals for ourselves and our teams. And we need to break down the journey towards the vision and goals into manageable steps that inspire others to move forward.

6) Habit #6: “See the glass as half-full.” Are you normally a pessimist or an optimist? Studies have shown that the most effective leaders are strong optimists. Being optimistic does not mean that we ignore the half of the glass that is empty. It does mean we are thankful for the half that is full, and we work together to fill the rest of the glass as best we can.

7) Habit #7: “Look for the win-win.” Effective managers don’t get locked into specific positions, but look for ways to meet interests of themselves and others so everybody gets something (a “win-win” versus a “win-lose”).

8) Habit #8: “Spend much time in Quadrant 2.” Stephen Covey popularized the importance of intentionally spending significant time doing “Important, Not Urgent” items. These include things like building relationships, reading and other learning activities, planning and thinking, exercise, etc. To spend more time in Quadrant 2, we need to spend less time in Quadrants 3 & 4 (i.e. “Urgent, Not Important” and “Not Urgent, Not Important”) activities like watching TV, playing video games and wasting time doing things that add no value to our lives or the lives of others.

9) Habit #9: “Enjoy the journey.” Management (and life!) is a journey – filled with both positive and negative experiences. The journey will be much more pleasant and we will go farther if we learn to laugh and be thankful. A Yiddish proverb says “what soap is to the body, laughter is to the soul.” Studies have shown that laughter makes us physically and emotionally healthier – and more fun to be around too. Find a funny friend; enjoy a funny TV show or movie – and just laugh! Being thankful is also important. The reality is that we all have much to be thankful for, and our lives will be more joyful and productive if we learn to develop an “attitude of gratitude.”

10) Habit #10: “Remember - your health is your wealth.” Gandhi said “It is health that is real wealth and not pieces of gold and silver.” Living a healthy lifestyle will increase your energy, stamina and emotional well-being – and help us be more effective in all that we do. A holistic healthy lifestyle includes developing and using our mental capabilities (read a good book lately or taken a class just for the learning?). We are also spiritual beings, and finding faith and serving others can nourish our spiritual health.

Let me leave you with a challenge to not settle for mediocrity, but to get in the game and go for management excellence. Listen to this President Teddy Roosevelt quote “It is not the critic who counts, nor the man who points out how the strong man stumbles or where the doers of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly … who spends himself in a worthy cause.”

Wes can be contacted at Wes.Friesen@pgn.com.

Are you Fred?

By Wes Friesen, Portland General Electric

“There is only one boss – the customer. If we don’t take care of our customers, someone else will.”

Fred Shea was a postal carrier who really took to heart and embodied the following quote from Martin Luther King: “If a man is called to be a street sweeper (or work in A/P or A/R!), he should sweep streets even as Michelangelo painted or Beethoven composed music or Shakespeare wrote poetry. He should sweep streets so well that all the hosts of heaven and earth will pause to say, ‘Here lived a great sweeper who did his job well.’”

Fred provided exceptional service to all his customers, and constantly went the extra mile – he would even drive through the neighborhood to check on people on his days off! One of Fred’s very satisfied customers was motivational speaker and author Mark Sanborn, who wrote a book about exceptional customer service called “The Fred Factor.” I highly recommend getting the book and the video training series and going through it with your team.

Here are four cardinal principles about being a “Fred:”

1) Principle #1: Everyone Makes a Difference - every individual can choose to do his or her job in an extraordinary way, regardless of the circumstances.

2) Principle #2: Success is Built on Relationships - the quality of the relationship determines the quality of the product or service.

3) Principle #3: You Must Continually Create Value for Others, and It Doesn’t Have to Cost a Penny - you can creatively find no-cost ways to exceed expectations of your customers.

4) Principle #4: You Can Reinvent Yourself Regularly - every morning you wake up with a clean slate. We can choose to follow the advice of John Wooden’s father Joshua who taught “make each day your masterpiece.”

One tool to measure how well your team provides customer service, is to conduct a periodic customer survey. By analyzing the results of the survey you can reinforce what is going well, and identify areas that can be improved. Because people are busy these days, I prefer to keep the survey simple and short. Here is a sample survey that you can use as a starting place:

CUSTOMER SURVEY

Timeliness:
Are your jobs completed in a timely manner?
Below Expectations ____
Meets Expectations ____
Exceeds Expectations ____

Quality:
How is the overall quality of the work that our team provides for you? (same scale)

Responsiveness:
Is the staff responsive to your special requests? (same scale)

Helpfulness:
Do you find that our staff are helpful and offer solutions to your needs? (same scale)

Overall Performance: (same scale)

Are there services that you would like to see that are not currently provided?
What do you feel are some areas of strength in how we serve you?
What ideas do you have on how we can serve you better in the future?

Unfortunately Fred-like service is not common – as Roger Staubach says “there are no traffic jams along the extra mile.” Being a Fred is a choice – how will you and your team choose?

Let me close with a final quote to think about that comes from Andrew Carnegie: “There are two types of people who never achieve very much in their lifetimes. One is the person who won’t do what he is told to do, and the other is the person who does no more than what he or she is told to do.” Good luck as you commit you and your team to go the extra mile and be “Fred’s!”

Wes can be contacted at Wes.Friesen@pgn.com.

Want to Improve Performance? Measure It!

By Wes Friesen, Portland General Electric

“Improving performance does not happen by accident. It is the result of a commitment to excellence, intentionality and focused effort.”

Peter Drucker was the considered the Father of professional management. He said “Leadership is lifting a person’s vision to higher sights, the raising of a person’s performance to a higher standard, the building of a personality beyond its normal limitations.” Being in a management role provides us the opportunity to intentionally raise the performance levels of our teams – and the individuals that comprise them.

To improve the performance of our teams, we need relevant performance measures to inspire, provide a common focus and allow us to track progress. Here are some tools to help develop powerful performance measures:

Ask the Right Performance Questions
The Right Questions express the critical few things by which to judge our performance results. Put yourselves in the shoes of your key stakeholders (investors, customers, employees) and ask what is important to them?

Organizational Development expert Brad Fishel points out that when you answer the Right Performance Questions realize that some measures you develop in response will be Quantitative (numeric) in nature (e.g. how many pieces of mail were produced last month), but some will be Qualitative (subjective) in nature (e.g. how satisfied are our customers). Don’t ignore qualitative measures – consider the usage of surveys and other rating instruments. Fishel also says “Better to have subjective judgments about important questions than objective data about unimportant questions”.

Develop “balanced” measures to judge success
Effective teams add value to all important stakeholders and avoid a singular focus (e.g. being low cost) to the detriment of other important outcomes (e.g. high quality). Following are potential types of measures to consider. For each measure that gets used, we should have a target/goal to compare actual results against:

1) Productivity (productivity is simply a measure of Goods/Services produced divided by Resources Used)
2) Quality (e.g. reliability, accuracy, mistake free, meets requirements, etc)
3) Volume (how much is being produced)
4) Timeliness (are work products completed when needed)
5) Service (are customers satisfied with the service they receive)
6) Compliance (are postal regulations, Sarbanes-Oxley, HIPPA, and other regulations being met)
7) Cost (e.g. measure overall costs and/or cost per unit)

Intentionally focus on improving performance
How can we strive to improve productivity and overall performance? Following are some tools to choose from:

1) Lay out a challenge (illustrated by the closing story)
2) Enhanced Training & Development
3) Provide recognition and use incentives
4) Pursue wise use of technology
5) Look for process improvements
6) Be a better servant leader and show more care for your employees
7) Solicit ideas from your team members
8) Learn from other successful teams

Let me close with the following story from the life of Charles Schwab, former head of U.S. Steel. Schwab said:

I had a mill manager who was finely educated, thoroughly capable and master of every detail of the business. But he seemed unable to inspire his men to do their best.

One day I asked him: “How is it that a man as able as you, cannot make this mil turn out what it should?” “I don’t know” he replied. “I have coaxed the men; I have pushed them; I have sworn at them. I have done everything in my power. Yet they will not produce.”

It was near the end of the day; in a few minutes the night force would come on duty. I turned to a workman who was standing beside one of the red-mouthed furnaces and asked him for a piece of chalk. “How many heats has your shift made today?” I queried. “Six” he replied. I chalked a big “6” on the floor, and then passed along without another word.

When the night shift came in they saw the “6” and asked about it. “The big boss was in here today”, said the day men. “He asked us how many heats we had made, and we told him six. He chalked it down.”

The next morning I passed through the same mill. I saw that the “6” had been rubbed out and a big “7” written instead. The night shift had announced itself. That night I went back. The “7” had been erased, and a “10” swaggered in its place. The day force recognized no superiors. Thus a fine competition was started, and it went on until this mill, formerly the poorest producer, was turning out more than any other mill in the company.

Good luck as you partner with your team and intentionally pursue a higher level of performance!

Wes can be contacted at Wes.Friesen@pgn.com.

With economy improving, IT departments hit the ground running

Posted by Mark Brousseau

High performing information technology (IT) departments at large companies have hit the ground running following the recent economic downturn, recalibrating their efforts to drive more business value from IT, and leaving their less adroit counterparts playing catch-up, according to new research from Accenture.

While many companies slipped into stagnation mode during the downturn, cutting budgets and focusing primarily on maintenance, high-performing organizations viewed IT as a growth engine for their business and the economic conditions as an opportunity to build capability.

Accenture defines high performers in IT as those that achieve excellence in IT execution, IT agility and IT innovation together, balancing the constant and sometimes opposing demands placed on today’s IT function.

High performers in IT not only manage IT like a business, but run IT for the business and with the business. CIOs at these organizations are engaged in their company’s business strategies and are able to truly map out how IT supports those strategies.

“Our survey found that chief information officers (CIOs) of high performance IT organizations are deeply involved in business outcomes and closely attuned to business needs – current and future – across the enterprise,” said Gary Curtis, Accenture’s chief technology strategist. “They are successfully retiring their legacy systems and embracing newer technologies. They are adept at managing the balance between optimizing costs and ensuring that they have the budget, skills, and resources to help fuel business growth.”

The research also found that high performers don’t just do a few things well; they excel across the board when compared to lower performing IT departments. Some examples:

... They have web-enabled 42 percent more of their customer interactions and 93 percent more of their suppliers’ interactions ;

... They are 44 percent more likely to recognize the strategic role IT plays in increasing customer satisfaction;

... They are eight times more likely to measure the benefits realized from IT initiatives;

... They spend 29 percent more annually on developing and implementing new applications rather than on maintaining existing ones; and

... They are twice as likely to view workforce performance as a priority by addressing challenges such as an aging workforce and collaboration, as well as developing technical and soft skills (business knowledge, relationship management)

“High performing IT departments are powerful drivers of value for their organizations – not simply keeping the lights on, but promoting technology initiatives that power innovation and enable the IT organization to function as a business,” said Curtis.

What do you think?

AFP Conference Attendees Ready to Buy

Posted by Mark Brousseau

After years of being relegated to the sidelines as a result of the economic downturn, attendees at this week's AFP Annual Conference at the Henry B. Gonzalez Convention Center in San Antonio, Texas, appeared to be back in the buying game, reports Mario Villarreal (mvillarreal@usdataworks.com), president and COO of Houston-based US Dataworks, Inc. (www.usdataworks.com). As evidence, Villarreal pointed to the advertised 30 percent bump in attendance, better booth traffic, and the more substantive conversations with prospects compared to last year.

"After several years of sitting through vendor presentations and strategizing internally about enterprise payments, many of the organizations at AFP appeared ready to buy," Villarreal said. "Based on the conversations we had at AFP, I think we will see a significant number of enterprise payments deals close next year." Villarreal said banks, in particular, appeared interested in enterprise payments.

Two key factors are driving the demand for enterprise payments, Villarreal said. First, operations have reached the breaking point in terms of effectively managing their existing payment silos. By consolidating all of their paper-based and electronic payment channels onto a single platform, organizations can reduce cost, eliminate redundant systems and processes, improve availability, gain better visibility into their payments, and apply consistent controls across their payment streams.

Second, organizations are more confident that they will have the budget necessary next year to kick-off an enterprise payments initiative. Furthermore, banks may be looking to make internal investments that deliver a reasonable rate of return rather than parking their cash and earning a measly 25 basis points, Villarreal said. "By no means are operations flush with cash, but IT budget dollars are loosening up for projects with a clear ROI, and enterprise payments fit that bill," he said.

What do you think?

Consumer Bill Payers Want Incentives To Go Electronic

Posted by Mark Brousseau

Consumers pay a lot of bills, and they pay those bills in myriad combinations of channels and methods. Consumers’ bill pay behavior isn’t a trivial matter—changes in behavior can result in millions of dollars of additional or lost revenue, or millions of dollars in cost savings.

Despite the increasing popularity of the Internet and the emergence of the mobile channel as a way to transact and interact, checks sent through the mail remain the most prevalent method for paying bills in the United States.

Aite Group says the number of bill payments made through the mail will fall just short of 5 billion for 2010, accounting for about one-third of all payments made, whereas payments made at a biller site—including recurring and mobile payments—will account for 23% of all bills paid in 2010.

Looking to the future, however, consumers’ bill pay behavior is very likely to change, Aite Group predicts. Roughly four in 10 consumers say they would change how they pay their bills if they received rewards for paying with a debit or credit card, or received a cash incentive for changing their behavior, the research and advisory firm reports. In addition, the rapid adoption of smartphones will help drive bill pay behavior change over the next three years.

“There’s an emerging segment of consumers—which we call Smartphonatics—that will lead to an increase in the use of the online and mobile channels for paying bills,” says Ron Shevlin, senior analyst with Aite Group. “These young and affluent consumers are chomping at the bit to use their smartphones, and are very likely to change how they pay bills if it becomes easier to do so via mobile. The growth of biller-direct over consolidator, coupled with the projected growth in mobile payments, means an opportunity for bill pay solutions providers to create an industry-leading mobile platform.”

What are you seeing?

Social Nation Building Done Right

Posted by Mark Brousseau

When social media first came on the scene, companies couldn't wait to get on board with the new trend, because they saw it as a way to expand their brands and grow their businesses—and, of course, they had high hopes for return on investment. Now, fast-forward several years. Today, many of these same companies have hired employees devoted to using social technologies but are now faced with answering the all-important question, Now what?

"There's no denying that social networking has worked for some companies and been a flat-out flop for others," asserts Barry Libert, author of the new book Social Nation: How to Harness the Power of Social Media to Attract Customers, Motivate Employees, and Grow Your Business. "Most companies are confused about what social networking really is and about how to successfully leverage it.

"The good news," he continues, "is that these companies don't have to give up their goal of building a successful 'Social Nation,' as I call it. They simply have to change the way they think about it and develop effective strategies. Primarily, they have to learn it's not about technology, as is commonly assumed...it's about community."

Libert knows what he's talking about. After all, he's the chairman and CEO of Mzinga, a company that provides social software to businesses. Quite literally, it's his job to be social media savvy. And he's adamant that before you start building your own Social Nation, you need to have a well-researched game plan. In fact, it's that knowledge, gathered through years of Mzinga's real-world experience, that prompted him to write Social Nation, a sort of social networking best practices manual.

"There's no denying that people know how to use tools like Facebook and Twitter—they just do it to no avail," Libert explains. "What they should be doing is focusing their attention on their customers, partners, and employees. Listening, acknowledging, connecting, and rewarding these people—and implementing what they have to say. I can't stress enough that social networking isn't about accumulating followers for the sake of having them—it's about building a community that brings real value and true ROI to your company."

It almost sounds too simple—but when faced with skepticism, Libert points out that a focus on building community spelled success for his company's clients long before the advent of Facebook. To date, Mzinga has worked with hundreds of companies to manage a total of 2.5 billion interactions a month through online communities.

Ready to rethink your own company's social networking strategy and start seeing some real value? Then throw out what you thought you knew about social media and read on to learn what really works in the land of social networking, as explained in Social Nation:

Build your own community. "Social Nation" is a catchy phrase, sure—but what does it really mean? Well, social is the construct of wanting to belong with another, and nation is being part of something that has purpose. Taking that into account, then, your company's social networking goal should be to bring like-minded people together in order to achieve a common purpose.

"It's all about connecting people who need to be connected, allowing them to become a part of your company experience," says Libert. "I've said it before and I'll say it again: Technology is important, but it will never be a substitute for community. If you want to see growth, you've got to develop a social network that helps people grow, engages their minds, satisfies their unmet needs, and connects them to one another."

Don't broadcast but share. Talking to someone whose conversation is constantly "me-me-me" isn't anyone's idea of a good time...and that principle also holds true in the world of social networking. It doesn't matter how frequently you update your company's status or blog about its achievements if you never deliver information that your followers actually want and need to hear.

"Always remember to create and disseminate quality content that helps people make good decisions, improves businesses, and enhances lives," advises Libert. "They want to read about topics that are actionable and applicable—so we always make sure our clients at Mzinga are providing their constituents with information, tools, and tips on subjects that are of interest to them."

Don't be a guest in someone else's home. Think about the differences between a house and a home. A house is only a structure—but a home is a place where you feel like you belong. That, Libert insists, is the difference between joining random social media sites for the sake of doing it and embracing and building a truly social business.

Realize that might does not make right. Just as your company should avoid disseminating "me-me-me" information via social networking, it should also avoid dominating the conversation. And make no mistake—a symbiotic two-way conversation is exactly what's going on here. A successful Social Nation always lets its community be part of telling the story, from start to finish. Look at it this way: Employees, customers, and partners are essentially volunteering their time and energy to serve as developers, sounding boards, and advertisements for your company. They want to belong—so let them, and listen to them.

"Recently, a company came to me and asked what they needed to do to become the leader in their industry," Libert recounts. "The first thing they had to do, I told them, was to stop trying to 'lead' everything! Instead, make it your goal to be the definitive 'community.' This will draw people in, and it will turn them into raving fans."

Social Nation tells the stories of companies that have embraced this shift to more open, social business models in substantive ways, forging new paths to workplace collaboration, product development, customer relationship management, brand loyalty, innovation, and profitability.

"What businesses should be doing is focusing their attention not on social media itself, but on how they can use it as a channel in every facet of their business to establish the genuine connections that are increasingly becoming the new path to profitability," says Libert. "As a business leader today, your job is to make sure these things happen, and I believe Social Nation can help you get there."

What do you think?

Doing "Different" Right

Posted by Mark Brousseau

In today's business world, "business as usual" is likely to put you out of business. If you're using the same old marketing strategies today because they brought in business in years past, you're in danger of being pummeled by your competition. In order to keep your customers happy (and happily spending!), explains Maribeth Kuzmeski, you have to get their attention, and that means your typical tried-and-true marketing tactics aren't going to cut it anymore. To beat your competition, she says you have to stand out and find ways to be you—uniquely!

"With all the noise in your clients' and potential clients' daily lives, it certainly hasn't become any easier to attract attention and appeal to your target market," says Kuzmeski, author of the new book ...And the Clients Went Wild! How Savvy Professionals Win All the Business They Want (Wiley, 2010, ISBN: 978-0-470-60176-1, $24.95, www.AndTheClientsWentWild.com). "But for your business to survive, you have to find ways to cut through that noise. Attracting attention often means that you have to step outside of the current norms and stand out."

If you aren't sure where to get started, Kuzmeski suggests taking a cue from other companies that have taken innovation to heart and used it to successfully win and keep customers.

Read on for some innovation inspiration from companies that found ways to make their customers take notice—while sticking with their values:

The Difference Maker: Buc-ee's
The Dared to Be Difference: Banking on bathrooms. Sometimes what your competitors consider to be "unimportant" may just turn out to be the differentiation that gets customers coming back for more. Buc-ee's gas stations—located throughout Texas—have focused their number-one offering on what people dread most about stopping at a gas station: the bathrooms! Each of the 30 locations has incredibly clean, substantially sized bathrooms, along with full-time attendants to keep them in tip-top shape. Buc-ee's built their entire business around the bathrooms—a feature they knew they could use to differentiate their business.

"This is a great example of how looking at things from a different perspective can really pay off," Kuzmeski says. "Instead of focusing on what clients liked about their industry, they chose to plan their strategy around what customers liked the least and improve upon it. Think about what people dislike most about your industry, service, or product offering. What solutions can you offer? It's a great way to differentiate yourself from your competition and to create some buzz in the process!"

The Difference Maker: Odwalla
The Dared to Be Difference: Juicing with a conscience. Juice company Odwalla was founded in Santa Cruz, California, in 1980 by Greg Steltenpohl, Gerry Percy, and Bonnie Bassett. The trio took the idea of selling fruit juices from a business guidebook. They began by squeezing orange juice with a secondhand juicer in a shed in Steltenpohl's backyard. Their plan was to make enough profit to help fund music programs in local schools.

Odwalla was driven by a corporate conscience and a goal of leading the public toward a closer-to-nature way of nourishing their bodies. The juices were very highly rated for taste. But the true success came in the way that they appealed to their customers. The founders hired marketing and advertising experts and created what they called their "Drink Tank"—a group responsible for developing and managing the Odwalla brand. In building the brand, members of the "Drink Tank" focused on authenticity, alignment, clear narrative, and the value of a strong corporate culture.

"With very little advertising, Odwalla differentiated their brand by extolling the benefits of drinking and supporting a 'juice with a conscience,'" says Kuzmeski. "As a result, people cared and followed and bought. Odwalla appealed to their customers' consciences and it paid off. Essentially, they called their customers' consciences to action. But the strength of that call to action led them to success. How strong is your call to action? Do you frequently tell your customers what you want them to do? It can be an incredible way to drive your customers and potential customers to do exactly what you want them to do."

The Difference Maker: Geico
The Dared to Be Difference: Ensuring brand awareness. When you think Geico, what comes to mind? Perhaps their slogan, "Fifteen minutes could save you 15 percent or more...." Or maybe that gecko with the British accent. Or the stack of money with the eyeballs that seems to distract and attract everyone near it. Or those oft-offended cavemen. Or maybe—just maybe—you think of all four! Geico has done a particularly remarkable job at grabbing attention for their insurance products. And they've done it by frequently and consistently distributing their simple and somewhat annoying messages to establish brand awareness.

"For Geico, frequency of their messages has brought them incredible brand awareness," explains Kuzmeski. "You don't have to have millions to spend on TV, radio, and print advertising to achieve the level of recognition Geico has achieved. What Geico has done is simply repeat, over and over, their message to their prospects. Think about what you can do to repeat your marketing messages to your target market. Do you frequently repeat your core benefits or offerings to your prospects? It's a simple tactic that can yield high results."

The Difference Maker: The Australian Government
The Dared to Be Difference: Offering the world's best job. The Australian Government promoted what they described simply as "the best job in the world" with a creative and extremely successful Internet campaign. The position they were advertising was a six-month contract to be caretaker of a series of islands in the Great Barrier Reef. The government released the story through traditional media (Reuters) and then sustained the buzz over an array of online networks including YouTube, Ning, Twitter, and Facebook. The contest's website received one million hits the day after its launch when the campaign's goal had been to receive just 400,000 hits over the course of the year. Furthermore, the program attracted over 34,000 applicants and generated over $70 million worth of global publicity.

"The lesson here is an important one," asserts Kuzmeski. "You have to evoke an emotion in your customers if you want a response from them. Whether it's hope, love, happiness, anger, or even hate, you want them to feel something. When people are passionate about something, they will act on it, tell their friends about it, and get involved. Think about what messages your company can convey that might provoke an intense reaction."

The Difference Maker: Vistaprint
The Dared to Be Difference: Giving it away for free. As a global company, Vistaprint employs more than 1,850 people, and ships to more than 120 countries around the world. The secret to their huge success? Business cards. Vistaprint wanted to offer their customers something that no other printing company did, so they decided that their hallmark would be jaw-dropping value. By offering 250 business cards for free, with a nominal $5.67 shipping and processing charge, they were able to appeal to their target market: cost-conscious small businesses. Today, 66 percent of Vistaprint's business comes from returning customers. In the first quarter of 2010 alone, they acquired 1.4 million new customers—many who started with a free order.

The Difference Maker: The Bargains Group
The Dared to Be Difference: Teaming up for A-level customer service.Jody Steinhauer began The Bargains Group in 1988 from her kitchen table by purchasing a variety of different clothing and reselling it to discount clothing stores. Today, she runs a multi-million-dollar firm with over 4,000 different items for sale, but the most interesting aspect of the company is its employees.

The Bargains Group is a discount wholesaler of promotional business products, family clothing, accessories, gifts, toys, bedding and linens, personal hygiene products, and tradeshow promotional materials. So how exactly does a small firm with only 20 employees manage to make millions every year without offering prices much lower than their competitors? It's simple: They hire the right people. By focusing on hiring fun, vivacious people who believe strongly in the culture of service, they are able to actually service each of their customers personally. They don't even have a voicemail system!

"While a lot of firms advertise how 'different' their people are, or how they focus on service, The Bargains Group actually proves this assertion," says Kuzmeski. "They don't advertise or employ salespeople—yet they manage to make millions of dollars selling their products. Make sure that your staff is a differentiator for your company. There is great value in good customer service. Happy customers will not only stick around, they will also spread the word!"

The Difference Maker: Dillard's Septic Service
The Dared to Be Difference: Doing the dirty work (literally). James Dillard, owner of Dillard's Septic Service in Annapolis, Maryland, runs a business that most others might consider "beneath" them. Yet Dillard earns a six-figure income doing what many of us would call mundane, boring, or downright disgusting. An October 10, 2007, article in USA Today by Del Jones, entitled "A Dirty Job, But Someone Has to Get Rich Doing It," featured Dillard and other business owners who have entered into careers that many others simply would not. And it is a potential avenue for business owners who are looking for a way to generate more income. In fact, in the Forbes 400 list of the wealthiest Americans for 2009, less than glamorous fields and products—including discount tires, roofing, salsa, lumber, and tequila—have produced extraordinary income.

"You might not consider these to be businesses that would create such great wealth," says Kuzmeski. "But all of these business owners found their niche, and, through it, their differentiation. Think about a product or service that you can offer that no one else will. You don't always have to be wracking your brain to come up with a product or service that is better than anything your competitors offer. You can also come up with a product or service that they simply won't offer. Products or services that others are afraid to touch can mean big opportunities for you!"

The Difference Maker: Man Cave
The Dared to Be Difference: "Manning" up before the rest. Who would have thought a Tupperware-type party for men would be a good idea? Cofounders Nick Beste and Kevin Carlow saw the success stories from female-centric companies like Tupperware, Silpada, and Partylite and thought, why not? As a result, they created Man Cave, an in-home party where hosts throw "Meatings" complete with a set of "Man Laws." For years, thousands of companies have demonstrated and sold products to groups of women in their homes. Now Man Cave does it for men. They aren't just the leader in their industry; they ARE the industry—and they anticipate crossing the $3-million mark by November 2010.

"Don't shy away from an idea just because it's never been done before," Kuzmeski explains. "In fact, discovering an untapped market can be like striking gold in this economy. Instead of following trends, you have to be brave enough to be a trendsetter. It can be the gateway to a big idea and a big payoff."

The Difference Maker: Realtor and Inventor Jean Newell
The Dared to Be Difference: Recognizing it's not what you know, it's who you know.
Veteran Realtor Jean Newell had an idea for her fellow real estate agents. She invented a personal utility pouch (PUP)—a multi-zippered mini-pack designed to carry all the technical tools, keys, contracts, and more that a real estate agent needs. Judging by the initial reaction she received, she knew she was on to something that people wanted. Her objective was to get on QVC, but she was turned down by gatekeepers again and again.

So she decided to reach out to her network, which consisted of other agents, buyers, sellers, etc., and ask for their help. She sent out an email requesting help to find a contact person at QVC for her new product and received an overwhelming response. Within a few days, she had 40 emails from people providing contacts at QVC. She created a quick video to show how she would promote the bag and sent it off to QVC. Within two weeks, she was accepted! Since her initial appearance on QVC, Newell has become a sales superstar and media darling.

The Difference Maker: Toy House
The Dared to Be Difference: Advertising curiosity. In Jackson, Michigan, a city and state hit hard by the economy, toy store owner Phil Wrzesinski was struggling to compete against local big box competitors like Toys "R" Us, Target, and Walmart. And then he had an idea. In August 2008 he began running ads on the local radio station that had local DJs wondering what was in the men's bathroom of the store. Droves of customers started coming in to see what actually wasin the men's bathroom. (The product in question, by the way, was a nightlight that projects stars on to the ceiling and walls of a darkened room.) The result? Despite the down economy, Toy House has seen a steady increase in both loyalty and sales ever since!

"Just because your product may be ordinary, it doesn't mean your promotion of it has to be," advises Kuzmeski. "Clever advertising can peak interest, create buzz, and get people talking—exactly what you want at a time like this. Don't be afraid to take risks with your promotion. Show that your company has an edge. It will set you apart from your competitors."

"To beat your competition in today's economy, you have to be offering something that no one else is—be it a unique product, promotion, offer, staff, or culture," says Kuzmeski. "You can't expect to keep customers coming back if you are offering only the status quo. Don't be afraid to take risks, think outside the box, and be a little daring. Not only will you grow your business, you'll find yourself inspired, recharged, and motivated."

What do you think?

Hey, America: TMI!

Posted by Mark Brousseau

A new national survey reveals half of Americans who use social networking sites have seen people divulge too much personal information, yet more than a quarter of Americans (28 percent) who use these sites admit that they rarely think about what could happen if they share too much personal information online.

Additionally, more than four in ten Americans (44 percent) are concerned that the personal information they share online is being used against them, and more than one in five (21 percent) Americans who use social networking sites believe that their personal information has been accessed by people who take advantage of weak privacy settings on social networking sites.

That's according to the 2010 Lawyers.com Social Networking Survey.

“The Lawyers.com Social Networking Survey reveals a clear disconnect between the privacy concerns of users and their actual behaviors and disclosures on social networking sites,” said Carol Eversen, vice president of Marketing at LexisNexis. “Nearly every week we hear about the negative consequences resulting from inappropriate disclosures and uses of personal information on social networking sites, however the data suggests that Americans are not taking the necessary steps to protect themselves.”

More than half of Americans who use social networking sites have seen people divulge too much personal information online. In fact, the majority of Americans who use social networking sites admit that they have posted their first and last name (69 percent), photos of themselves (67 percent), or an email address (51 percent) on a social networking site. In addition, survey respondents have also shared the following details on a social networking site:

•Travel plans (16 percent)
•Cell phone numbers (7 percent)
•Home address (4 percent)

Determining how much is too much is still a struggle for many people. Nearly half of Americans (46 percent) agree that sometimes it is hard to figure out what information to share and what to keep private.

As many Americans struggle with what type of personal information to post online and keep private, they also seldom think about the consequences of sharing personal information online. More than a quarter of Americans (28 percent) admit they rarely think about what could happen if they shared too much personal information online.

A quarter of Americans (25 percent) who use social networking sites say that they have seen people “misrepresent” themselves (e.g., posted incorrect information and created fake profiles) and alarmingly, more than one in ten Americans (14 percent) who use social networking sites say that they have received communication from strangers as a result of sharing information on a social networking site.

Other backlash from using social networking sites includes:

•Someone posting unflattering pictures of them (11 percent)
•Having personal relationships with family or friends affected from revealing too much information (7 percent)
•Being scolded or yelled at for information they’ve posted (6 percent)
Surprisingly, 38 percent of Americans agree that people who share too much of their personal information online deserve to have their information used inappropriately.

Three-quarters of Americans (76 percent) worry that the privacy settings on social networking sites are not adequately protecting their personal information. In addition, more than four in ten Americans (43 percent) admit that they typically just click “agree” without reading the entire terms and conditions on social networking sites.

Meanwhile, many believe that their personal information may already be in the wrong hands. More than four in ten Americans (44 percent) are concerned that the personal information they share online is being used against them, and one in five Americans (21 percent) who use social networking sites believe that their personal information has been accessed by people who take advantage of weak privacy settings on social networking sites.

What do you think?

Utilities grow weary of siloed payments solutions

Posted by Mark Brousseau

Rising payment processing costs may be catching up to utilities, if this week’s 13th Annual Utility Payment Conference hosted by Dominion at the Hilton Hotel in Richmond, VA, is any indication.

Historically, utility payments were among the easiest and cheapest to process, thanks in large part to the high number of full-pay transactions that included a remittance document with an OCR scan line. In fact, TAWPI’s 2009 Payments Benchmarking Survey showed that the average cost per paper-based remittance payment remained unchanged at $0.15 per item between 2005 and 2009. But the emergence of new payment channels, such as the Web and credit card, has disproportionately “taken out” so-called “clean” transactions, leaving utilities with more complex paper-based remittances. At the same time, utilities must cost-effectively manage this growing number of payment streams.

Not surprisingly, utilities in attendance at this week’s payments conference were keen on finding solutions that would consolidate both paper-based and electronic payment streams onto a single platform. Mario Villarreal, president and COO of US Dataworks, Inc. – an exhibitor at the event – can’t remember a time when utilities have shown as much interest in enterprise payments solutions.

This follows a trend I observed this summer at the Federation of Tax Administrators conference.

“The utility market is clearly thirsting for enterprise payments solutions that provide them with greater visibility, efficiency and consistency in their revenue management,” Villarreal explained.

For utilities, centralized processing is one of the key advantages of an enterprise payments approach. Villarreal says centralized payments processing is especially appealing to utilities that are expanding their geographic footprint; one utility he spoke with at the conference operates in 33 states. With an enterprise approach, utilities gain better visibility into their payments, regardless of their footprint.

Utilities see similar benefits to centralizing the archival of their payments images and data, he adds.

But vendors may be slow in getting the message, Villarreal added. “Most of the exhibitors at the conference are still taking a fragmented approach to automated utility payment processing.” The vast majority of the 38 exhibitors at the Payment Utility Conference strictly offer siloed solutions for payments applications such as remittance, cashiering, remote deposit capture or ACH processing.

In Villarreal’s eyes, that won’t solve the challenge utilities face in their payments operations.

“Until you consolidate systems and apply standard processes and controls across payment channels, you will always be saddled with inefficient and costly payments operations,” Villarreal concluded.

What do you think?

6 tips for messages that resonate

Posted by Mark Brousseau

Today we are overwhelmed with messages. Some are just 140 characters long. Others are much longer, but they are constantly bombarding us—trying to lure us to acquire and consume information (then repeat the process over and over). Technology—social media specifically—allows for constant communication, but easy communication doesn't necessarily translate to messages that are received, understood, and capable of driving action.

At a time when people are tweeting, blogging, emailing, and more 24/7, the best way to genuinely connect and create change, says author and CEO Nancy Duarte, is via truly human, in-person presentations. She stresses that everyone in every company should know how to present and communicate that company's messages with clarity and passion.

"Great presentations are like magic," says Duarte, CEO of Duarte Design, author of the award-winning book Slide:ology, and author of the new book Resonate: Present Visual Stories That Transform Audiences.

"It takes a lot of work to breathe life into an idea. Spending energy to understand the audience and carefully crafting a message that resonates with them means committing time and discipline to the process. Think about it this way: You likely spend countless hours collaborating and innovating to put forth really good ideas. You should spend just as much energy ensuring they are delivered in a way that is impactful. The payoff is that learning how to present in a captivating way—be it at a formal event or to a client across the conference room table—can be your competitive edge in a business environment where too many companies are confusing communication with noise."

So how can you make sure you present information in a way that truly resonates?

"If people can easily recall, repeat, and transfer your message, you did a great job conveying it," says Duarte. "To achieve this, you should have a handful of succinct, clear, and repeatable sound bites planted in your presentation that people can effortlessly remember. A thoroughly considered sound bite can create a Something They'll Always Remember (S.T.A.R.) moment—not only for the people present in the audience but also for the ones who will encounter your presentation through broadcast or social media channels."

To help you get started creating presentations that really stick with your audiences, here are a few tips on how you can incorporate repeatable sound bites:

Create crisp messages. Picture each person you speak to as a little radio tower empowered to repeat your key concepts over and over. "Some of the most innocent-looking people have fifty thousand followers in their social networks," says Duarte. "When one sound bite is sent to their followers, it can get re-sent hundreds of thousands of times."

Craft a rally cry. Your rally cry will be a small, repeatable phrase that can become the slogan and rallying cry of the masses trying to promote your idea. President Obama's campaign slogan, "Yes We Can," originated from a speech during the primary elections.

Coordinate key phrases with the same language in your press materials. For presentations where the press is present, be sure to repeat critical messages verbatim from your press materials. "Doing so ensures that the press will pick up the right sound bites," explains Duarte. "The same is true for any camera crews who might be filming your presentation. Make sure you have at least a fifteen- to thirty-second message that is so salient it will be obvious to reporters that it should be featured in the broadcasts."

Use catchy words. Take time to carefully craft a few messages with catchy words. "For example, Neil Armstrong used the six hours and forty minutes between his moon landing and first step to craft his historic statement," says Duarte. "Phrases that have historical significance or become headlines don't just magically appear in the moment. They are mindfully planned."

Make them remember. Once you've crafted the message, there are three ways to ensure the audience remembers it: First, repeating the phrase more than once. Second, punctuating it with a pause that gives the audience time to write down exactly what you said. And finally, projecting the words on a slide so they receive the message visually as well as aurally.

Imitate a famous phrase. "Everyone knows the Golden Rule," says Duarte. "'Do unto others as you would have them do unto you.' Well, an imitation of that famous phrase might be 'Never give a presentation you wouldn't want to sit through yourself.'"

"The future isn't just a place you'll go," says Duarte. "It's a place you will invent. Your ability to shape your future depends on how well you communicate where you want to be when you get there. When ideas are communicated effectively, people follow and change. Words that are carefully framed and spoken are the most powerful means of communication there is."

What do you think?

4 Reasons Government Entities may adopt Integrated Payments Hubs

Posted by Mark Brousseau

If you think your operations budgets are tight, try managing payments processing for a government entity. Badly stung by declining tax revenues, most state, county and municipal governments have squeezed their operations budgets dry. And it couldn't have come at a worse time for government operations managers: like their counterparts in the private sector, governments are struggling with how best to adapt their operations to declining check volumes and emerging payments channels.

Leilani Doyle (ldoyle@usdataworks.com), product manager at Houston-based US Dataworks (www.usdataworks.com), believes government entities may find a solution in so-called enterprise payments hubs (or integrated payments hubs), which consolidate paper-based and electronic payments into a single platform, in turn, streamlining processing and eliminating operations silos.

About one-quarter (22.2 percent) of all government entities that responded to a recent IAPP-TAWPI survey indicated that they have implemented an enterprise payments hub to consolidate paper and electronic payments. The responses from state revenue agencies nearly mirror the overall findings for this question, with 21.4 percent indicating that they have implemented an enterprise payments hub. Non-revenue state agencies and county government entities have made a little more progress in this area, with 33 percent of (non-revenue) state agencies indicating that they have implemented an enterprise payments hub, and 40 percent of county government entities (by far the highest adoption rate among the groups tracked) stating that they have implemented an enterprise payments hub.

Doyle says 4 factors could drive faster growth of enterprise payments hubs among governments:

1. Declining paper volumes. As government agencies achieve success with electronic payments, their existing paper-centric infrastructure becomes obsolete. "Paper will not go away any time soon, but there's no need to maintain equipment and applications designed to manage large volumes of paper payments," Doyle explains. "Moving forward, government entities will need an integrated payments platform that can scale up or down as needed. This type of payments processing platform operates like a utility that can be easily adjusted to changing payment types and volumes."

2. Focus on serving constituents. Implementing an integrated payments hub enables government entities to provide better service to their constituents, Doyle explains. Research can be performed from a single location. Posting is more accurate. And check images can be retrieved instantly.

3. Push to reduce bank fees and operations costs. With an integrated payments hub, government entities can consolidate their bank deposit files, putting them in a stronger position for negotiating bank fees. Inside government operations, an integrated payments hub helps government entities increase overall staff productivity by not requiring them to learn different applications for processing each payment type. Similarly, reports for staffing and efficiency can be produced from a single system, streamlining the generation of Key Performance Indicators each agency must produce.

4. Lower capital expenditures and ongoing costs. With the emergence of enterprise payments solutions that offer a Software-as-a-Service (SaaS) or hosted delivery model, government agencies can replace their aging systems with little to no upfront cost. This is a creative way to allow agencies without the budgeted dollars to replace antiquated legacy systems, Doyle says. "SaaS services also provide an added layer of security and compliance protection, starting with PCI compliance and SAS-70. This can significantly reduce risks and audit costs for government agencies." What’s more, leveraging a SaaS or hosted delivery model means government entities can offload the management of their IT infrastructure. This not only saves money, but also allows government entities to better focus on their core competency -- serving taxpayers. And this may be the biggest benefit of all.

It's for these reasons that Doyle thinks government entities may adopt integrated payments hubs.

What do you think?

Why Can't Tellers be Sellers?

By Vijay Balakrishnan, president of StratEx, LLC (vijay.balakrishnan90@gmail.com)

Stepping into a debate that is as old as retail banking is perhaps unwise. There are passionate adherents ranged on both sides of the question. To some, the issue is not whether, but should tellers be sellers?

The question brings the raison d'etre of the retail branch network into sharp relief. Are branches retail storefronts with the primary mission to enhance customer relationships, or are they collection points for myriad transactions processed by centralized back office operations centers? Is the driving imperative one of customer intimacy, or does operational efficiency rule the roost?

A tilt towards operational efficiency has traditionally driven retail banking, with occasional overtures to the selling side of the equation. These overtures, however, tend to be fleeting, and with few exceptions, have not survived beyond some concerted marketing and employee incentive programs.

To understand why the push towards serving and selling the customer has not been sustainable, consider a few points. Making check deposits is by far the main reason customers visit a branch. When they do visit, the teller is the person they most often interact with. Regardless of all the training and incentives that may have been put in place, consider what tellers actually do. They are heads down punching numbers into keyboards (try counting the number of teller keystrokes the next time you're in a branch). They have barely enough time to complete the data entry and squeeze out a quick thank you before the next customer is at their window. Imagine a Neimann Marcus salesperson wordlessly packing what you've picked out and intently ensuring that the bow on the package is just right! Yes, the analogy is not quite right- but you get the picture.

So despite many a marketing push, it is the fundamental transaction tether that yanks the teller back into the role of a frontline operations clerk- the first cog in the vast infrastructure that we put in place to process paper checks, featuring planes, trains, automobiles and giant "paper factories".

There is an alternative, courtesy the legislative cover of Check 21 and advances in imaging and recognition technology. Teller Capture allows the teller to drop the entire deposit into a small foot print scanner and interact heads up with the customer, while an imaging application reads all the necessary information, ensures the transaction is balanced, and prints out a receipt when done. Teller Capture eliminates teller induced data entry errors, and also catches math errors up front. This "ready-to-post" transaction at the very beginning of the deposit stream results in major efficiency savings further down the value chain. It is as close to straight-through-processing as one can get in the check world.

"Not so fast," say some. "You want to make my tellers into check operators?" The reality is that the opposite is true. There is now evidence of major savings in teller time per deposit, including data from a Top 5 U.S. bank of having reduced keystrokes from 75 to 5!

"What about the cost of a scanner and software at every station?" challenge others. "It is really difficult to integrate these capture applications with teller systems." The cost per node for both hardware and software is steadily declining, making it well worth the while to examine the return on investment. The hard numbers on transportation savings, back office labor elimination, and funds availability make it interesting- leave alone the soft benefits in customer service and added sales. Capture systems are also increasingly being integrated into teller systems, both by teller vendors that have acquired check-capture technology, and pure play check imaging vendors that have certified their applications with leading teller vendors.

Coming back to the tellers-to-sellers paradigm, what do you do with the saved time? Do you use it to push even more transactions through? Do you have tellers refer customers to other branch personnel based on prompts from an integrated CRM system? Or do you have tellers take on more of a sales and service role themselves? Those are decisions that will be driven by your overarching strategic intent. Do you want tellers to be sellers in the first place? As you ponder that question, you may want to look at teller capture as an opportunity to cut the transaction tether that keeps pulling you back, yo-yo-like, to the paper factory of another era.

What do you think?

(Fr)agile Software Development

By Vijay Balakrishnan, president of StratEx, LLC (vijay.balakrishnan90@gmail.com)

Much of our world is made possible by software. There are myriad software systems that manage and move our money, keep track of our health histories, light our homes and offices, and indeed even enable you to read this post. While the sheer scale of accomplishment from zeros and ones flitting about at the speed of light is astounding, the manner in which some of these systems are developed, tested, and delivered raises a few questions.

Over the falls in a barrel. The early years of evolution in software development owed much to needs of the defense and aerospace industries. These were highly mission-critical systems that had to work correctly almost ten times out of ten. A linear process that involved detailed specifications, technical designs, strict coding discipline, reviews, and rigorous testing ensured the delivery of many high performance systems.

A version of this made its way into the commercial marketplace under the broad "waterfall process" moniker. The series of hand-offs, from product management, to architecture, design, development and testing, with intermediate review cycles, hearkened a series of waterfalls as in a cataract. While the process worked well for the most part, it lacked speed. The many steps limited organizations to one or two releases to the marketplace a year. It was difficult to nimbly respond to competitive and regulatory changes. If changes were not included early enough in the cycle, it was tantamount to missing an exit on a tollway, and waiting for the next one.

Sprints around the racetrack. In the 1970's, the automotive industry introduced the concept of "simultaneous engineering", where design engineers, manufacturing engineers, and quality control worked together in teams. As opposed to the linear, "throw it over the transom" model, this engendered both speed and sharing of ideas. That germ of an idea made its way into software as Agile Development. While there are many agile methodologies, the general concept is that specifiers, programmers, and testers work together in short, iterative, "sprints" to produce executable software. Over multiple sprints, complete, ready-to-release applications can be built.

Lost in translation. While agile development has made it possible to release software more frequently, a few challenges have appeared on the way to nirvana. To the agile purists, I will grant that many of these have to do with incorrect interpretation and implementation, and perhaps not because of fundamental drawbacks in the methodologies. The challenges are amplified when you add offshore development where the advantage of co-located teams disappears. They are also most acute when software is developed for General Availability to a large and varied customer base, as opposed to internal use within an enterprise. Here are some of the pitfalls I have observed over the years:

What we have here is a failure to communicate. With apologies to "Cool Hand Luke", one of the main complaints I have seen is, "We don't know what is coming, and when!" We have moved from exhaustive, written requirements to writing nothing down. The refrain is that the sprint teams communicate with each other, and are on top of release content. Some will add that everything can be discerned from documentation within the code. The problem is that there are many stakeholders outside the sprint team, such as sales, marketing, professional services, and support. These people are not adept at reading code, and think in terms of functions and applications, as opposed to individual features. The result often is that market facing groups either oversell or undersell the product (more often the former!).

Who's on first? While sprint teams are cohesive and democratic, the flip side is that it can result in no one at the helm. While the methodologies call for a "function customer" who signs off on software content and quality, this role is often missing in action. Either the role is completely absent, or it is relegated to a Product Manager who is more of a Product Marketer than someone who can go head-to-head with a technician. In the absence of this key role, many cooks jump in to influence the software broth in one direction or the other, resulting in content churn. The process is agile yes, but highly unstable.

Tried and tested. Agile methodologies like test driven development put testing and quality at the center of the process. In practice, however, quality often ends up getting the short end of the stick. The very expectation of agility can compress timelines due to unrealistic promises made to customers. In the rush to "get it out of the door", thorough testing is skipped, and some vendors essentially do their quality assurance on the customer's dime, by continuously band-aiding software at the customer site until it works. In extreme cases, this becomes a license to hack with little regard to version control, belying the very concept of "General Availability". While poor quality is not limited to agile methods, the less rigid process restrictions can exacerbate the tendency in organizations that already have a culture of treating quality lightly.

Customs and traditions. In organizations that cater to customers of varied sizes, the concept of General Availability can be turned on its head. There is often the case of a large customer that wants software customized to meet a unique need. There are very few vendors that have the discipline to examine whether that particular capability warrants inclusion in the software delivered to the general marketplace. The path of least resistance is to include it as a base capability that is "configurable". Over time, the preponderance of configurable customizations makes the software incredibly difficult to implement and support. Again, the lack of a process to adjudicate the "base versus custom" question can result in a multi-headed Hydra, with hidden heads that can appear to bite you when you least expect it.

Distant shores. Every one of the problems discussed explode in complexity when offshore development is involved. The communication challenge now includes time zones, national cultures, and language. The concept of sprint teams working in iterations is predicated on the concept of co-located personnel who can discuss, white-board, and resolve questions face-to-face. Getting this done with people somewhere else on the planet is very difficult, and contributes to hidden costs in offshore development that can obliterate the wage differential in the early stages of the offshore journey. The challenge can be overcome, but it takes special focus and attention to drive out the inefficiencies.

Brave new world. The benefits of agile development have ensured that it is here to stay in most environments. The word to the wise is that getting it to work right involves recognizing the pitfalls, and addressing them involving the right stakeholders. I would not be surprised if many of you recognized your organizations in some of the challenges I have outlined. It is important to recognize that getting software development to work is not just the purview of the programmers alone. Someone said, "War is too important to be left to the generals". If you'll allow the stretch, let me end by saying, "Software is too important to be left to programmers, and methodologies."

What do you think?

6 Questions to Ask When Shopping for a Remittance Solution

By Mark Brousseau

Buying a remittance processing solution has never been easy. But the combination of emerging payment and clearing channels, expanding systems integration requirements, and new customer service demands has made the process more confusing than ever.

To add some clarity, Wally Vogel (wvogel@creditron.com), founder and CEO of Creditron, Inc. (www.creditron) offers the following six questions to ask a prospective remittance solutions vendors.

1. How much opening and pre-sorting is required before scanning incoming remittance work?
Bearing in mind that there are often several steps required to move from unopened mail to stacks of clean sorted documents, which some remittance solutions require, Vogel suggests looking at the remittance solution in the context of the end-to-end operation. "Look for a vendor that can integrate with an efficient mail opening system and handle a variety of transaction type without requiring pre-sorting," Vogel advises.

2. What about payments that are made in person or over the web?
The mix of payments has changed and will continue to change, and spending money on a solution that only handles mail payments no longer makes sense, Vogel says. "A remittance platform worth investing in should have fully integrated cashiering, web payments, and credit card payments, with consolidated deposits, accounting updates, and reports," Vogel says.

3. Have you successfully interfaced with our ERP/accounting system/billing system/content management software before?
This is an area of potential hidden costs and problems if not addressed upfront, Vogel warns. "You have a significant investment in your information systems, and front end capture points such as remittance processing need to work seamlessly or the result will be unexpected integration work by your IS group, or worse, unforeseen problems with your data down the road," Vogel says.

4. Have you successfully implemented Check 21 Image Cash Letter with our bank before?
This is another potential problem if your remittance vendor and bank are not on the same page, Vogel says. "Don’t get caught in between. Use a vendor that has already proven that they can work with your bank, or if your bank does not have a process and certification in place for working with third party vendors consider using another bank for image cash letter services and having the funds swept to your main bank on a daily basis," Vogel recommends.

5. Is this a fully proven and tested solution or will there be any customized code?
Unless you want to be a beta tester, you should choose a vendor that has completely standardized and proven code that can be configured to your needs through parameters. "Even a small block of customized code can cause problems with reliability or integrity, and make later updates problematic and expensive," Vogel explains. "Choose a vendor with a standard codebase and an easy method to upgrade to the latest revision."

6. Are you a Microsoft Certified partner?
"If you are putting wiring in your house, you insist on a licensed electrician. If you want legal advice, you look for a lawyer that has passed the bar. Similarly, if you are choosing a remittance software provider to work in the Microsoft Windows environment, you should insist in a Microsoft Certified Partner," Vogel says. "This ensures that you are dealing with a professional and qualified organization which has made the investment in certifying their people and products before asking you to make an investment in their solutions."

Do you have any tips you can share?