Cardinal versus Ordinal


What do we mean when we say that a variable is “quantitatively measurable”?We do not necessarily mean that there is only a single way of measuring or scaling it. Temperature is certainly quantitatively measurable, but there are alternative ways of doing so. For example, 320 Fahrenheit is 00 Celsius, and each degree up or down of Celsius corresponds to 1.8 degrees up or down of Fahrenheit. The two scales differ, but only in zero point and unit interval. Similarly, altitude could be measured from sea level or from the center of the earth (shift of zero point) and in feet or meters (shift of unit interval). Both temperature and altitude are more technically called cardinal magnitudes, variables which have the following property: that, regardless of shift of zero-point and unit interval, the relative magnitudes of differences remain the same. In case of altitude, for example, there’s a bigger difference between the heights of the base and crest of Mount Everest than between the ground floor and roof of even the tallest building. This remains true whether we scale altitude in feet or meters or whether we measure it from sea level or from the center of the earth. If people can state that they prefer two million to one million—but not by how much—their utility is said to be an “ordinal” magnitude. Put another way, if Total Utility is an ordinal magnitude we cannot say anything about the  size of Marginal Utility but we can still say whether Marginal Utility is positive or negative.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

 

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Scientific Method and Marketing Research


Scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them. With the scientific method, managers don’t just assume that their intuition is correct. Instead, they use their intuition and observations to develop hypotheses—educated guesses about the relationships between things or about what will happen in the future. Then they test their hypotheses before making final decisions.

A manager who relies only on intuition might introduce a new product without testing consumer response. But a manager who uses the scientific method might say, “I think (hypotheses) that consumers currently using the most popular brand will prefer our new product. Let’s run some consumer tests. If at least 60 percent of the consumers prefer our product, we can introduce it in a regional test market. If it doesn’t pass the consumer test there, we can make some changes and try again.”

The scientific method focuses an orderly research process. Some managers don’t carefully specify what information they need. They blindly move ahead—hoping that research will provide “the answer.” Other managers may have a clearly defined problem or question but lose their way after that. These hit-or-miss approaches waste both time and money.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Improving Quality


Improving quality is a lot like taking vitamins, eating healthy foods, and exercising regularly. Although the results may not be immediate, long-term benefits are significant. Quality is neither a quick fix nor the program of the month, but rather a way of life for companies who are serious about improvements.

Quality is a fundamental to creating value, yet it is a moving target and must meet the customers’ current definition of quality. Thus, we offer the following recommendations for improving service quality and ultimately delivering superior customer value:

  • Design services in cooperation with customers. Learn what customers truly value by incorporating the voice of the customer earlier in the service development process. Also, it is important to determine not only the customers’ preferred service attributes but their relative importance, as well.
  • Focus your improvement programs outward, on market break points. Only by defining those episodes, when the customer comes in contact with the organization, and by focusing on the ones most critical can you see things as the customer sees them. Also, visualize the complete sequence of the moments of truth a customer experiences in having some need met. Remember, the customer sees service in terms of a total experience, not an isolated set of activities. Mapping the service cycle helps companies see these activities as the customer sees them.
  • Create a triangle representation of service quality. Hotels and restaurants often advertise and display on their properties ratings by one of the major motor clubs, such as AAA or Mobil Oil, Hertz #1 Gold Club service communicates a premium, value-added bundle of services to business travelers seeking a hassle-free car rental experience.
  • Use teamwork to promote service excellence—service workers who support one another and achieve together can avoid service burnout.
  • Create a service bias based on each of the following service quality determinants: professionalism, attitudes and behaviors, accessibility and flexibility, reliability and trustworthiness, service recovery, and reputation and credibility. These criteria can be used as guidelines for influencing positive service quality perceptions.
  • Develop proper measurements. Use metrics that are specific on nature, such as 95% on-time-delivery, customer wait time, or order processing time. Benchmark the best practices for each service are being measured, such as wait time or order delivery.
  • Employee selection, job design, and training are absolutely crucial to building customer satisfaction and service quality. Structure the job of service workers to maximize their ability to respond quickly and competently to customer needs. Also, train service personnel in areas of service delivery and attitude. Role play different service scenarios, showing various service recovery strategies. Provide service workers with some basic tools to help control service quality variation and uncover service problems.
  • Reward total quality efforts in marketing. Look for opportunities to reinforce quality behaviors when they occur. Employees should be rewarded ob the basis of these behaviors (commitment, effort) rather than strictly on outcomes, such as sales quotas. Rewarding a salesperson for meeting or exceeding quota with a bonus while giving a nominal award such as a pin or plaque to the person who fixes the product or process sends a clear message about the importance of quality.
  • Think of service as a process, not a series of functions. Service quality occurs when the entire service experience is managed and the organization is aligned to respond accordingly.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Learning Organizations are Fun


Many organizations, even in this day and age, still hate hearing bad news. This is driven by their attitude to learning: at heart, organizations are either learning organizations or they are not. Those that are not learning organizations genuinely hate bad news. They shoot messengers and prefer to bury their head in the sand till they get kicked out of their complacency and forced to act. Fortunately (or not) for some of them, they have enough credit in the bank to get kicked quite a few times before eventually they receive one kick too many and are pushed over the edge. Learning organizations, however, are fun to work in and attract talent.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

The Creative Selling Process


Although it may look easy, creative selling is not a simple task. Of course, some sales are made in a matter of minutes. But others, particularly for large organizational purchase, can take years to complete. Salespeople should follow a carefully planned process from start to finish.

Step 1: Prospecting: Prospecting is the process of finding and qualifying potential customers. This involves three activities:

  • Generating sales leads. Sales leads are names of individuals and organizations that might be likely prospects for the company’s products.
  • Identifying prospects. A prospect is a potential customer who indicates a need or a desire for the seller’s product.
  • Qualifying prospects. Not all prospects are worth investing sales time in. some may not have the authority to buy, and others won’t have enough money. The ones who do have both the authority and the available money are called qualified prospects.

Step 2: Preparing: With a list of hot prospects in hand, the salesperson’s next step is to prepare for the sales call. Without this preparation, the chances of success are greatly reduced. Preparation starts with creating a prospect profile, which includes the names of key people, their role in the decision-making process, and other relevant information such as the prospect’s buying needs, motive for buying, current suppliers, income/revenue level, and so on.

Next, the salesperson decides how to approach the prospect. Possible options for a first contact include sending a letter or cold calling in person or by telephone. For an existing customer, the salesperson can either drop by unannounced or call ahead for an appointment, which is generally preferred.

Before meeting with the prospect, the salesperson establishes specific objectives to achieve during the sales call. Depending on the situation, objectives can range anywhere from “getting the order today” to simply “convincing prospects top accept the company as a potential supplier.” Following that, the salesperson prepares the actual presentation, which can be as basic as a list of points to discuss or as elaborate as a product demonstration or multimedia presentation.

Step 3: Approaching the Prospect: Positive first impressions result from three elements. The first is an appropriate appearance—you wouldn’t wear blue jeans to call on a banker, and you probably wouldn’t wear a business suit to call on a farmer. Appearance also covers the things that represent you, including business cards, letters, and automobiles. Second, a salesperson’s attitude and behavior can make or break a sale. A salesperson should come across as professional, courteous, and considerate. Third, a salesperson’s opening lines should include a brief greeting and introduction, followed by a few carefully chosen words that get the prospect’s attention and generate interest. The best way to accomplish this is to focus on a benefit to the customer rather than on the product itself.

Step 4: Making the Presentation: the most critical step in the selling process is the presentation. It can take many forms, but its purpose never varies: to personally communicate a product message that will convince a prospect to buy. Most sellers use of two methods: The canned approach is a memorized presentation (easier for inexperienced sellers, but inefficient for complex products or for sellers who don’t know customer’s needs). The need satisfaction approach (now used by most professionals) identifies the customer’s needs and creates a presentation to specifically address them.

Step 5: Handling Objections: No matter how well a presentation is delivered, it doesn’t always conclude with an immediate offer that might move the prospect to buy. Often, the prospect will express various types of objections and concerns throughout the presentation. In fact, the absence of objections is often an indication that the prospect is not very interested in what the salesperson is selling. Many successful salespeople look at objections as a sign of the prospect’s interest and as an opportunity to develop new ideas that will strengthen future presentations.

Three basic approaches to overcoming objections include asking the prospect a question, giving a response to the objection, or telling the prospect that you will need to look into the matter and address it later.

Step 6: Closing: So far, you haven’t made a dime. You may have spent weeks or months—years in some cases—to bring the customer to this point, but you don’t make any money until the prospect decides to buy. This stage of the selling process, when you persuade the customer to place an order, is referred to as closing.

How should you ask for the order? Closing techniques are numerous; here are some of the more popular. The alternative proposal close asks the prospect to assumptive close, you simply proceed with processing the order, assuming that the prospect has already decided to buy. Another alternative is the silent close, in which you finish your presentation and sit quietly, waiting for the customer to respond with his or her buying decision. Finally, many salespeople prefer the direct close, where you just come right out and ask for the order.

These closing techniques might strike you as tricks, and in the hands of unethical salespeople, some closing approaches certainly can be. But the professional salesperson uses these techniques to make the selling process effective and efficient—not to trick people into buying when they aren’t ready.

Step 7: Following Up: Most salespeople depend on repeat sales, so it is important that they follow up on all sales and not ignore the customer once the first sale is made. During this follow-up stage of the selling process, you need to make sure that the product has been delivered properly and that the customer is satisfied. Inexperienced salespeople may avoid the follow-up stage because they fear facing an unhappy customer. However, an important part of a salesperson’s job is to ensure customer satisfaction and to build goodwill.

In order to improve the odds of keeping a satisfied customer after the sale, salespeople should remember to:

  • Handle complaints promptly and pleasantly
  • Maintain contact with customers
  • Keep serving the customers
  • Show appreciation.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Just About Money


Strictly defined, money is anything generally accepted in exchange for goods and services. To be used as a medium of exchange, money must be acceptable, divisible, portable, stable in value, durable, and difficult to counterfeit.

Acceptability: To be effective, money must be readily acceptable for the purchase of goods and services and for the settlement of debts. Acceptability is probably the most important characteristic of money: If people do not trust the value of money, businesses will not accept it as a payment for goods and services, and consumers will have to find some other means of paying for their purchases.

Divisibility: Given the widespread use of quarters, dimes, nickels, and pennies in the United States, it is no surprise that the principle of divisibility is an important one. With barter, the lack of divisibility often makes otherwise preferable trades impossible, as would be an attempt to trade a steer for a loaf of bread. For money to serve effectively as a measure of value, all items must be valued in terms of comparable units—dimes, for a piece of bubble gum, quarters for laundry machines, and dollars (or dollars and coins) for everything else.

Portability: Clearly, for money to function as a medium of exchange, it must be easily moved from one location to the next. Large colored rocks could be used as money, but you couldn’t carry them around in your wallet. Paper currency and metal coins, on the other hand, are capable of transferring vast purchasing power into small, easily carried bundles.

Stability: Money must be stable and maintain its declared face value. The principle of stability allows people who wish to postpone purchases and save their money to do so without fear that it will decline in value. Money declines its value during periods of inflation, when economic conditions cause prices to rise. Thus, the same amount of money buys fewer and fewer goods and services.

Durability: Money must be durable. The crisp new dollar bills you trade at the music store for the hottest new CD will make their way all around town for about 18 months before being replaced. Were the value of an old, faded bill to fall to line with the deterioration of its appearance, the principles of stability and universal acceptability would fail. Although metal coins, due to their much longer useful life, would appear to be an ideal form of money, paper currency is far more portable than metal because of its light weight. Today, coins are used primarily to provide divisibility.

Difficulty to Counterfeit: To remain stable and enjoy universal acceptance, it almost goes without saying that money must be very difficult to counterfeit—that is, to duplicate illegally. Every country takes steps to make counterfeiting difficult. Most use multicolored money, and many use specially watermarked papers that are virtually impossible to duplicate.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Customer Orientation


  • Do you know the objectives of your customers (and their customers)?
  • Is your service offer designed with the customer in mind?
  • Are your internal systems (ordering, billing, shipping, computers, financial, etc.), geared toward how the customers prefer doing business with you?
  • Do you constantly measure customer satisfaction?
  • Do you continually meet with your customers to determine their needs today and tomorrow?
  • How is value created, delivered, monitored, and maximized in your organization?

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

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