Success Secrets | For little firms, big ideas are a must

Success Secrets | For little firms, big ideas are a must
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First Published: Sun, May 18 2008. 04 38 AM IST

Jack and Suzy Welch
Jack and Suzy Welch
Updated: Sun, May 25 2008. 05 55 PM IST
We are an outsourcing start-up that wants to break into the US and European markets. But, the big companies that could be our clients won’t even talk to guys such as us. How do we get them to at least hear our proposal?
— Ram Muthiah, Seattle, Washington
By changing the game. In a nutshell, that is what it takes for a little service company such as yours — that is dying to break in — to get the attention of the monster companies.
Most of the time, those companies are so bureaucratic and risk-adverse — and their buying operations so tied to the tried-and-true monster suppliers — you can’t offer any form of marginal improvement to get in the door. You have got to make an offer they can’t refuse.
Jack and Suzy Welch
Sure, the entrenched competition will be out there making killer offers too, and with track records to prove they can deliver. To make matters worse, your competition’s sales teams have probably worked for years to develop personal relationships with the key players inside each customer’s buying operation, shepherding them through more “special events” than you could count. In other words, your competition has made itself the devil they know.
Which is why you have to do something radical. You can’t get a contract by offering a somewhat lower price or somewhat faster delivery. The first time out, there is just no reason for the buyer to risk his reputation by believing in you for that kind of payback.
Rather, you have to buy your way in the door with a transformative value proposition with almost zero risk attached. Essentially, you have to make it seem dunderheaded not to do business with you—it is a no-lose proposition.
A case in point is the Indian outsourcing business Wipro. Starting in the late 1980s, it came, seemingly, from nowhere to wiggle its way around the established technology service providers and into the hearts of big customer after big customer. Its modus operandi was to offer something outrageous — significantly higher quality with a massively lower price — and, then, over-deliver on that promise by orders of magnitude.
It was stunning, and the buyers who went with them very quickly looked like heroes in their organizations. No wonder it took only a couple of decades for Wipro to grow to a $3 billion (around Rs12,660 crore) global operation with nearly 80,000 employees.
Similarly, in its early days in the mid-1970s, the consulting firm Bain & Co. told potential clients: “You don’t need to pay us very much upfront. Down the road, just pay us a percentage of the additional profits our recommendations are sure to earn you.” With that kind of upside-only proposition, it is not surprising that Bain was able to get a foothold in an industry that was already overcrowded with brand-name firms.
Along with their almost too-good-to-be-true value propositions, both Wipro and Bain possessed a second critical quality that won them clients in their start-up days, and that was fire. Their sales representatives may have been well-educated engineers and MBAs, but the best of them still displayed a certain religious fervour about the unmatched value their company could deliver. Their presentations would leave behind converts who wouldn’t be saying “Hmm, interesting”, as in the typical postmortem, but: “Did you see the way those people believe in themselves? Did you see the fire in their eyes? They make me believe, too.”
So, not easy, but there are your marching orders. If you want the big guys to “at least hear your proposal”, as you put it, the promise of your proposal has got to blow them away, with an outsize upside and minimal downside. And, once in the door, you have to blow them away again, with your passion. Together, that is the foundation upon which winning enterprises are built.
I am an information technology consultant who makes $300 an hour at my firm. A customer has offered to pay me $1,000 a day to moonlight for them on the occasional weekend. Should I take it?
—Name withheld, Houston
Here is the only answer to your question: Ask your boss. That is the only way to get clear on your company’s policies regarding outside work, and to do the right thing by them.
After all, ethical decisions must always be transparent.
Your question, however, raises another point, and it is for leaders. No company—regardless of its size or business—should be without some kind of safety valve that allows employees to ask about quandaries such as this one. It can be a confidential ombudsman, an anonymous tip line or whatever method works best. The last time you want your people to feel alone is during an ethical dilemma.
Write to Jack & Suzy
Jack and Suzy are eager to hear about your career dilemmas and challenges at work, and look forward to answering some of your questions in future columns. Jack and Suzy Welch are the authors of the international best-seller, Winning. Campaign readers can email them questions at winning@livemint.com. Please include your name, occupation and city.
Only select questions will be answered.
©2008/by NHT Syndicate
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First Published: Sun, May 18 2008. 04 38 AM IST