Exceptional firms look to the future, forgo the familiar

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I had the privilege of advising and consulting with 35 companies in 2006, almost all of that work at the request of the CEO or the board. In only one of those companies was the consulting engagement focused on the future. In the other 34, it was remedial work: analyzing and advising how to fix what was wrong. In the one exceptional company, the question was, "How do we leverage all the things we are doing right and grow the company to $1 billion?" That was a remarkable experience. That is a remarkable company.

After reviewing the year I asked a trusted colleague, "Why is it we see so much under-performance by so many major direct marketers in so many sectors of business to business?" The response essentially was, "I don't know. It has always been like this. And there is so much opportunity everywhere."

So, why do so many direct marketing companies perform at half of their potential? And why do only a few perform at or above their potential? What makes the difference? I see 10 things:

Passion. Top performers have a passion for what they do that most of us only dream about. These people love business and they love their business. In one way, they are fortunate. Passion of that kind is rare, and very successful people invariably possess it to extremes. In another way, they are cursed. They can never get away from that passion, and their lives are shaped by it almost totally and almost constantly. I ask these passionate, extraordinary people, "What do you read?" The answer is always Peter Drucker's books or Jack Trout or some other business titan. It is never Charles Dickens or Thomas Hardy or John Steinbeck.

Because passionate business owners and leaders are so focused on the business, they often reinvent themselves and the business to ensure they stay at the leading edges. Others (the 34 others) enjoy the familiar groove, the familiar niche, the familiar SICs. They maintain the past and the present; the passionate ones create the future. And that is the difference: maintain or create.

Use of money. The passionate creators spend money; the maintainers take the money out of the business and make it earn every step of its undistinguished way. All investment has to be "self-funding."

Exceptional businesses know the value of talent, technology, facilities, investment prospecting, advanced logistics and integrated enterprise operating systems. Unexceptional companies have only enough talent, technology, facilities, prospecting, logistics and operating systems to get by without having to invest anything in the future. Consequently, they often don't have one.

Ideas. Exceptional owners surround themselves with more ideas than they can ever accomplish. But, they have options. The average company spends a lot of time pushing ideas away, mostly because they require investment, but also because they might be dangerous, especially if they aren't the owner's idea.

Original ideas are monopolized in the marketplace by the exceptional companies. The average companies haven't had an original idea since the first one that got them their niche.

People. The extraordinary company has extraordinary people, and all of them are also passionate. The average company has average people, and none of them are passionate. Extraordinary attracts extraordinary; average attracts average. And when average companies inadvertently attract an extraordinary person, the result is painful and short-lived (and the extraordinary person moves on).

Attention to basics. While leading in innovation, technology and ideas, extraordinary companies also are grounded in and proficient with all the direct marketing basics. They know the numbers off the top of their heads, to the penny and the percentage. Average companies struggle to cover or discover the basics. They employ entry-level people to manage the circulation plan because they are cheaper and - after all - all you have to do is tell Abacus what it is you want and they do everything.

Extraordinary companies run circles around their competitors in every channel because they have a seasoned, confident and proven circulation pro working with a seasoned, confident and proven broker and everybody's feet are held to the fire for performance and productivity. Extraordinary companies don't ask for a discount; they often pay their broker a higher commission for delivering higher prospecting performance.

Elegance. The extraordinary company has an elegance of mind as well as an elegance of style. The owner wears custom-made or designer clothing and has a custom analytic and perceptive mind. The restrooms and the minds are well decorated and fully furnished, one with choices of soaps and linen towels, the other with concepts and open-minded reasoning. The warehouse and the personality are neat, orderly, clean, automated and organized. The business mirrors the person. And the management team in these companies lives that elegance. The average company is, well, average. Things are a little dusty, a bit wrinkled.

Boldness. The extraordinary companies are fearless; the average companies are fearful. One attacks the future; one defends the past. One is comfortable with challenge and the unknown; one is comfortable with only the known and what once worked. One leads; one follows. One takes risks; one is riskless.

Inclusion. Extraordinary companies include all of their trusted advisers in their research and decision-making processes. The conference room for a strategy session may have 10 or 15 vendors, suppliers, consultants, all charged with the objective, "Help us leverage what we do well to become a $1 billion company." And every one of these trusted advisers wants to be innovative, wants to find a breakthrough, wants to create and wants to uncover a hidden opportunity.

Average companies don't trust their vendors. These firms bend vendors for another 2 percent, spread the business among as many as possible to ensure the lowest possible price and often lay failure at the feet of the vendor.

One is inclusive and thrives on the combined intellect of many; one excludes and wastes away on the squandering of intellectual opportunities.

Rule breaking. Extraordinary companies do almost everything differently than they should. They disregard what should be for what is. While attending to the direct marketing basics and truth, they also believe only what the customer tells them. And if what the customer wants requires breaking DM conventional wisdom - out goes the conventional wisdom! Average companies play by the rules, take no chances, haven't talked - really talked - with a customer in years. Chiseled above the door is the timeworn motto: Status Quo.

Questioning. Extraordinary owners or leaders question everyone they come into contact with. These are not accuracy questions, but rather questions about what is new, how others are changing pagination, what landing pages are working, whether video is getting prospecting response in search hits, how much falloff in pay per click there was in October, whether long-term response is eroding in co-ops ... and a thousand questions aimed at people with knowledge that can be used. The average company asks few questions and - frankly - usually doesn't know what questions to ask.

What will we see in 2007? What if we waved a magic wand and gave every average direct marketing company the 10 attributes of an extraordinary company? Wow!

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