On business goals and priorities, first published on Frankaffe.
When we discuss growth of a company, various factors come into play which can be divided into tangible and the intangible. Tangible aspects include the measurable – revenue numbers, average revenue per user, margins and various other ratios. Though customer satisfaction can be tracked, the methods to improve it tend towards the intangible which consists of aspects like the design, the experience being offered, communication skills and manners.
Every organization has a healthy divide where one influential manager focuses on numbers, while the other focuses on the experience. This little tug of war aids everyone to focus and work hard to keep the levels of both high, which does magic for the business. Some experts might suggest that revenue drives the business, through tough times and the good. They say that even if the intangible fails to be paid attention and suffers, revenue can help the business survive. Like a mother cradling its kid up close. It remains to be seen whether the ‘mother’ is a cat or a monkey.
Why is a Monkey Different than a Cat
Monkeys mostly carry their young on their backs, who hold on to their dear lives as the mother moves around. If one of the kids falls, it has to clamber back on again. While the mother monkey gives ample love to the kids, there is effort expected out of them. Only love for their mother and complete surrender to their fate will not help them get where they need to be. They need to stay focused, hold on and be ready to climb in case they fall.
Cats, on the other hand, carry their kids around. They pick them up by the collar, and stride away to their destination. Kids do not fall off, and even if they do, the mother promptly picks them up again and continues to move. In this case, only the love for their mother and complete surrender to their fate is enough to see them through.
Why is Revenue a Monkey
You would prefer a prettier looking chocolate with a better wrapper even if the quality is the same. That’s because you would be judging the taste of the chocolate by how it looks, and how it is being presented. You would want a cleaner restaurant, a server who smiles and a sign that shows good looking humans. You would neither like a smelly cab even if it does its job well, nor seek to do business with a home cleaning company that shrugs off its responsibility.
That is because functional (how it works) aspect forms the skeleton of your desire to use a service, but a lot depends on the flesh that forms the body. Rational (how you perceive the value) & emotive (how the value addition makes you feel) aspects mean the world to you, and you would jump to a better alternative the moment it’s presented. As a result, significant effort goes into ensuring that all aspects of a business run smoothly, and we have to hold on tightly for a smooth ride. Revenue Monkey Mother is a strict disciplinarian.
How to hold on tight like a Monkey Kid
It is cheaper to retain customers than to acquire new ones. Happy customers would recommend you to more customers FOR FREE. Also, it’s FREE to make them happy because all you need to do is to do your business right and be a good human being. Keeping your word, keeping the promises being made, showing sincerity through your actions goes a long way in delighting your customers. They are not used to being offered a 10 and receiving a 10, because most of the companies promise 10 and deliver 8. If you promise 8 and deliver 8, voila! You have customers for life.
It means accepting vulnerabilities. It means being human to your customer, instead of a faceless entity, a brick wall. Customers adore companies who human-up. They would carry you through, accept stuff that goes wrong. Who doesn’t like a shy skinny teenager who accidentally bumps into you, murmurs a apology and shuffles along? Monkey kids know that they might fall off, so they hold on. Monkey kids do the hard work of holding on, and their mother understands that. When they fall, she is patient enough to wait till they clamber on, might even give them a leg up, and the kids are back to holding on tight.
When we focus on design, customer experience and customer service – it stands for the effort put into holding on tight. Revenue is the mother, of course, it’s the reason the business survives, why the business was even born. But if we lose our grip and allow ourselves to lose focus on design, experience & service – we fall.
Why some experts feel Revenue is a Cat
Probably because it is true in some cases. We have grown up in an economy where mom & pop stores rule the roost. Demand has always exceeded supply, which allowed the supply significant say in how the business should be conducted. We have been traders, we have strong trading communities, and the shop in the corner of a street has been sure to make money the moment its shutters go up.
When the trader doesn’t have to make an effort to bring in customers, he sets into a comfort zone and that’s when revenue is the only thing that really matters. While you might argue that the storekeeper still needs to be pleasant and the store still needs to be cleaned, well, the kid (cat or monkey) needs to be well behaved. But the level work of needed to keep customers happy in case of a monkey is significantly higher than the work needed to keep customers happy in case of a cat.
Times they are a changin’, though. Supply has caught up with demand, you have young upstarts making more promises and managing to keep them as well. The customer expectations are increasing by the day, and so does the money they have to spend on you. But only if you deserve it. And you deserve it only if you keep up with the times. As a result, though the ‘cat’ story used to be pretty valid earlier, monkey makes more sense now. Monkey kids work harder to hold on their mother. Companies have to work harder to hold on to their revenue.
Making It Through
There is a reason why revenue is the mother, instead of the intangible aspects. However, the mother has given birth to the kids, and they help her live because she loves them. And they love her back, and they cannot live without her either. Separating the mother from her kids because it’s cheaper to sustain one life than more would be myopic. A mother’s soul would would wilt away without the kids, and that would prove more expensive. Quite like the peasant who killed the golden goose.
Revenue and profit form the very basis of conducting a business. It is unwise to continue offering incentives to your customers, because they don’t need those incentives if you are relevant. If you are not relevant, cease being so, go on a hunting trip and find your goddamn relevance. Once you sort out revenue & relevance, it gives birth to the intangible aspects – design, experience & service. Now the kids have to be taken care of, else the mother would die and the business would suffer. Keep the kids happy, and the mother would prosper, ensuring you are a big success.
I have plucked the monkey & cat subjects from a Upanishads tale, which a dear friend and guide recently shared. What has me spellbound is how the analogy floats through business and life, as if the principles apply to everything everywhere. You cannot clap with one hand, you cannot have a disciplined life without a happy you and the happy people around you, you cannot have a successful business without a sincere you and happy customers. It’s a joyous ride, and we better hold on tight 🙂