Global Thinking

I was doing some ‘market research’ today and made an incredible discovery: I like things to be simple.

This was a surprprise, because in sales and distribution, HYPE IS KING. Plain talk and simple demonstrations are rarely seen in the rush to make you buy. I do this sort of research for one reason: Its easy to be a salesman, with all the, “Blah, blah, blah,“ and hype. You know what I mean. But, I shop and buy things, too, like you. I want to see these things as a customer and not just as a salesman.

So I did a little "shopping around" for asphalt repair products. I found this guy: www.pavepatch.com This fellow is selling a good looking product, space age and USAF-developed and so on. My first obstacle, though, was there was no price. I had to hunt for it among all the busy pitching. I found I didn’t like that. It's usually the first thing people want to know, yet here it was hidden behind a mountain of sales hype. It was aggravating; maybe I'm impatient.

After diligent searching, I found it: $100 for a five gallon pail of pothole filler. Okay.

So how does it work? Well, you have to mix this stuff in two parts with a bag of some aggregate filler and then mix it all up using an “egg beater” like attachment ( sold separately ) with a power drill. They even have a video to show how “easy” it is. Once mixed, and hopefully not splattered all over you, you pour this stuff in and tamp and smooth it out. Again, okay.

So I said, “Let’s compare benefits!”

With my product the price is… the same. No difference really. My “Chuck-Hole Patching” filler will cost you $97. $30 for the filler and $67 for the primer, enough to fill the average sized 2 ft. x 2 ft. hole. In sales talk we call that “competitively priced!” I‘ve never claimed to be the cheapest, and never will. Do you have to use the primer? You decide - I say yes.

So okay, a hundred bucks, either way. Both products are cold-applied, last a long time and are rated for highway use. Both offer a lot of value for the money.

How about application. NOW we start to differ. Theirs is a mixed up affair, adding special tools and the potential for some serious messiness. My “Chuck-Hole Patching” material is applied right from the pail. No mixing, no mess. About the only tool you need is a 4X4 to tamp it down with.

My problem is, I had to deduce all this. Couldn’t they have just told me that without all the hype?

Yaro Starak, the Blog King, says no. People want to have long drawn out ads, he says, which tell them everything they could want to know and some things they could care less about. He says they are accustomed to long sales pitches and expect to have that as part of the value equation.

Well, I tried. I really did. I wanted to present a big carnival of information on my "Chuck-Hole Patching” product - - but, I couldn’t get there. We’re not selling 747’s here, these are pavement patching products. DO they work? Are they affordable? Can I use them without paying expensive labor? Yes, to all of that.

Is mine better? I think so, if just that you don’t have to do all that messy mixing. Does it take three pages to tell you about it? Gosh, I hope not.

Thanks for visiting,

David

    The Italian economist, Vilfredo Pareto, observed in 1906 that 20% of Italy's population held 80% of that nations wealth. Vilfredo also found similar relationships in his garden. He was an avid gardener and loved fresh peas, it seemed. He also found, suprisingly, that 80% of his beloved peas came from 20% of the plant itself. The universailty of this analytic idea took hold of him and was the foundation for his later works on social structure and how it relates to the dispersal of wealth.
   In the 1940's, his works enjoyed a renaissance and were formulated by a man named Joseph Juran into what has become the standard model of 'result dispersal' in business. You hear it by many names such as "the Rule of the Vital Few," or as it's more commonly known, "The Pareto Principle," or just the "80-20 Rule."
    Simply put, it says that input and output are not balanced. In more practical terms, it states that 80 percent of your results come from 20 percent of your efforts. Now this is not hard and fast; there is some imprecision and you shouldn't follow it slavishly; in many cases the ratio can be a lot higher - 95/5 may be closer to reality.

    Yet it still holds close to the truth and your results very often outweigh your inputs. Lets look at some examples for a minute.

Reducing costs
   Look at the things you spend your money on. Then look at which ones you spend the most money on and analyze the results you get. Find the products or services that generate the most income for the least money (the "vital" 20 percent) and drop or modify the rest (the "trivial" 80 percent). Say you wanted to compare different entertainment items in your budget. You could value each expense on the pleasure it brought you. If you wanted to compare different investments or tools you could compare return rates or productivity gained. Take this blog for example. It's FREE (for now) and yet I can reach many, many people with it for only a few hours per week of my time. Seen as dollars for time, thats a great value! 80% results for 20% (or less) of marketing dollars spent. Could I get the same results for a $700 dollar ad account somewhere. Maybe, that's it. Maybe.

Maximizing personal productivity
   Here we're taking things sort of in reverse. The first step here is admitting that 80% of one's time can be absorbed by "trivial, 20%" activities. To correct this, find the work that gives the most value and concentrate on that, instead.
   For example, I have a friend who can tell some great stories. When he gets rolling, he's unstoppable and before you know it, far too much time has passed - and little else gets done! WE talked about it yesterday and even he admitted he is his own worst enemy when it comes to productivity. The challenge, then, is obvious: cut him off gently before he gets going, so his 80% "time eating stories" never get started. Then, both he and I can go find other things, the 20% "vital few," that give "80% results." 

Increasing profits
   This is tied to reducing costs, but also stands alone when you apply it to expended effort. Let me allow Yaro Starak, the "Blog Traffic King,"  to tell it his way:
   "It’s very clear that a small handful of repeat customers account for most of my income. These customers become longterm users, and fit well demographically and socially with the business model. In analysis, they provide 80 percent of my value received - but only represent 20 percent (or much less) of the overall people that use my business. My job is to determine the best way to attract and convert more customers into longterm users.

  With blogging I learnt (and teach in my Blog Traffic Tips newsletter) that there are a handful of activities that I do every day that produce the most results. Breaking things down further, there are usually a key 20 percent of elements within an individual blog article (think article headline) that have the most dramatic affect on results. The numbers of course are not clean 80/20 ratios but there are definitely dominant factors at play.

In a business sense, finding the 80/20 ratios is crucial for maximizing performance. Find the products or services that generate the most income (the 20 percent) and drop the rest (the 80 percent) that only provide marginal benefits. Spend your time working on the parts of the business that you can improve significantly with your core skills and leave the tasks that are outside your best 20 percent to other people. Work hardest on elements that work hardest for you. Reward the best employees well, cull the worst. Drop the bad clients and focus on upselling and improving service to the best clients."

   The point in all this "80/20 cahtter" is to spend some vital time looking at all your efforts this way. It seems odd to do this, at first, when you cook dinner or look through your computers hard drive. But if you try it, you'll be surprised. You'll see that there are tasks in the meal preparation, for intance, that are key to the end result - but take little total time. Or, you'll find that there are literally a gazillion things on your hardrive that could be moved off or deleted, simply because they are used rarely, if at all. This leaves more space for the "Vital Few." Once you get used to doing this "Pareto Analysis," you'll begin to look for the 20% of anything that gives back the highest and best 80% results in all aspects of your life.

   Next time, I'll delve deeper into how to create a hard "Pareto Chart" analysis, which graphically illustrates your "80/20" results in tabular form. So check back for that.

   And as always, contact me for your FREE paving inspection around your business or home. Paving is the most costly item on any property, next to the building itself. You owe it to yourself to maintain it. Call 803.221.3364... if busy, try again.

Have you ever heard of a guy named Jonathan Harris?

Don't worry, I had to dig into my memory to recall him, too. 

He was just another poor child, born to meager beginnings and immigrant parents. But, he wasn't content with that and developed himself into something much greater. In time, he became an American television icon, known to all. 

He reminds me that many things start out as one thing - but eventually become something much different. 

Take your average home, building, street, or even a parking lot. They start out new and full of promise. But, soon, most often through neglect, they become something else altogether.
- Perhaps, they only become an eyesore, forgotten on the side of the road. People will pass them and wonder about them - maybe.
- If neglected for long, they surely become a financial drain to someone. Even the costs of tearing thme down can mount, not to mention the costs to refurbush them.
- If bad luck is in the stars, they turn into a safety hazard, waiting to harm the unwary passerby. Some one gets hurt because of the neglect and then the cost in suffering are added to the material costs.

But with a resolute maintenance plan, all of this can be avoided. These properties can fulfill their promise of comfort and prosperity for which they were built. And, it only takes a simple few tools, a relativley minor budget outlay and some occasional effort. Given these things, they can keep going strong, safely serving the needs of their owners for many, many years. They can become - and remain - the thing they were created to be.

So, who was Johnathan Harris? Well, he was actually born Jonathan Charasuchin, in The Bronx, New York, to a lower-class Jewish family. He was enamored of the theater and changed his name to "Harris" at age 17. He was a loving and well loved family man, remaining married to his one wife until his death in 2002. He was an accomplished violinist and had, it is told, 12 separate hobbies which he enjoyed!
Then in the early 1960's, he landed a bit part on a science fiction adventure pilot, then being floated by his studio as a test. Surprisingly, this program became wildly popular and had a successful 3 year run. Have you guessed who he was?

If ever there was a man unlike the character he portrayed, it was Jonathan (Charsuchin) Harris. While he appeared on stage and screen for most of his adult life in various character roles, you'll remember him best as the villainous and oily Dr. Zachary Smith, from the television series, "Lost in Space!"

Global Reminder: The paved areas around any business are the second most costly item on the property. Ensure your paving investment keeps working for you, safe and sound. Contact us today for a FREE Paving Inspection in the Aiken, SC area. Outside Aiken, let us recommend one of our affiliate partners to serve you. HOMEOWNERS WELCOME, too!

Phone: 803.221.3364             email: global_protects@bellsouth.net