|KEY RESULTS: Are You Using the 80/20 Rule? Most of us have heard of the 80/20 rule, but few have continuously used it. For example:
• 80 percent of our business comes from 20 percent of our customers.
• 80 percent of our revenue comes from 20 percent of our products or services.
• 80 percent of our complaints come from 20 percent of our customers.
• 80 percent of our sales are generated by 20 percent of the people who do the selling.
Business owners need to understand what their 20 percent areas are. It is also important that they help their employees define the 20 percent areas that generate 80 percent of their results. These 20 percent areas are their key result areas. Key result areas are the priorities on which employees should be concentrating the majority of their time and resources. These are areas of accountability in which each of us must excel to add value to the rest of the organization. (Bob H., Denver, Colo.)
A Focus on Prioritization: My new service manager instituted a prioritization program that speeds up follow-through on his technicians’ suggestions for needed equipment, new techniques, etc. If it is a “fire issue,” he immediately takes care of it. A “fire issue” is defined as an immediate need which will substantially affect a customer’s order. Other ideas, suggestions and requests are placed on the “parking lot” bulletin board. These ideas are in full sight of everyone, allowing the employees to see that they haven’t been ignored. Items on the board are taken care of as opportunities, budget dollars or time allows. Anyone who suggests an idea that won’t be pursued gets a personal response, and if needed, an explanation as to why not. This has been an efficient way to handle suggestions and improve communications—two long-standing problems in my shop. (Heath B., Green Bay, Wis.)
Price is Not King: Regardless of the large size of a particular client or the impersonal nature of the contact (as found for instance in working with the Navy and the Army), the relationship and the human contact is still the most important part of the business transaction. It also goes to show that price is still not the most important consideration in making a sale. The most important consideration is value. (Robert A., Charlotte, N.C.)
Jeff Raynor, TAB Certified FacilitatorTM, heads TAB Carolinas - part of The Alternative Board®, a global CEO peer group and executive coaching firm. Some tips extracted from “Tips from the Top®” © TAB Boards International, Inc. Contact Jeff at 704-554-6200 or visit www.TheAlternativeBoard.com.