Taking control of change

If my last article ‘Change Is Constant – and Lonely’ (Photo Counter, April 4) resonated with you, then what are you doing to stay ahead of the industry turmoil and turbulence facing your business?

Budd_webMost independent photo retailers probably feel – quite validly – that they are currently the victims of change, rather than agents for change: Online retailing, grey imports, smartphones, suppliers competing with you, mass merchants using photo prints as loss leaders, and more.  Change is seemingly attacking us from all sides.

So feeling pummelled by change, it’s perhaps counter-intuitive to decide to be an initiator. But the simple truth is that change is happening whether you want it or not. If you’re not initiating and directing the change impacting your business it’s highly likely it won’t be to your benefit.

How then do you change things for the better so that more customers are spending more and consistently giving you an excellent rating for value, relevance, satisfaction and innovation, each and every time they engage with one of your ‘touch-points’ – be they in-store, online or on the phone?

Assuming you are committed to the idea that you want to change things for the better, the starting point to the process is converting that thought into ACTION. And the first action should be about YOU gaining an understanding of what the change process involves for you and your people.

The four components of changes
I have met many business owners and executives in this and other industries who say they want to change for the better, but when the process commences they either get frustrated, enjoy a fast start that fizzles or if things get messy the commitment goes onto the ‘too hard’ pile.

Generally, this happens because they didn’t bother to understand and embrace the key components of what’s needed to create change.

Creating change involves four major elements – pressure for change, a clear shared vision, a capacity for change and actionable first steps. Leave out any of these components and change will simply not occur.

Now, most people in photo retailing would readily agree that there is pressure for change. But it’s the following elements that demand some skill and expertise, commitment, money and time.

Likewise in the early stage it’s worthwhile reviewing the different types of change models you could use to guide your planning process. The classic planning model starts with the question, ‘where are we now?’ Many would argue in these times it’s necessary to use an alternative model that asks ‘where is the environment going to be?’ simply because we live in such unpredictable times. In a stable industry environment the ‘where are we now’ approach works, but in photo retailing in 2013 we need to understand where the market is going so you can be highly relevant and hopefully even get ahead of the curve.

Your next step – an audit
Identifying the importance and urgency for change can only come about once you have conducted a professional audit of your total business from a customer perspective. The audit needs to be carried out by an experienced, neutral advisor who is able to seamlessly fit into your organisation and convert the myriad problems and opportunities that will be identified in the audit process into a comprehensive, actionable report that can be taken to the next stage.

The auditor ideally should have industry experience and insight. Richard Robertson, for instance, would make an excellent photo retailing auditor – if he could be enticed back from the golf course for long enough!

I have conducted audits for design studios, ad agencies, and in my consultancy work with Photo Direct, for photo retailing businesses. I have seen from that experience that even running with just one or two audit-based improvement opportunities the associated action plans can deliver significant, measurable improvements to the business in a very short period of time.

The good news is that we don’t need to start from scratch in the photo retailing channel. PMA in the US has some excellent audit reference material and here in Australia, companies like IBIS issue detailed reports on many sectors including photo retailing. Such reports include insightful measures and information to compare your business against. For example I’m talking about ‘key operating ratios’ (excuse the jargon) like stock turnover, average days outstanding, salary-to-sales ratios, rent-to-sales ratios and other critical success factors. Once you’ve taken a measurement of your business’ performance you can confidently tackle those areas where the least investment of time and money will deliver the greatest improvement.

It may be that you start with a partial audit. Perhaps the best place to start an audit is with the customer. For instance, finding out what you customers think of your store on a range of parameters like product knowledge, staff attitude, quality, location – even ease of parking! Or you can ‘go the Full Monty’ and have a business audit that covers every aspect of your company. A full audit will cover the rational side as well as well as the emotional aspects of your capability to grow and extend your business.

Acceptance or denial?
Your acceptance of the facts and observations in the audit report is critical. Choosing not to agree with this impartial assessment of your business’s health is an option, and is one many business owners elect to follow. I’ve seen many comprehensive audits not get past the initial stage because of the business owners negative reaction to the audit findings.

If the audit identifies you, say, as a micro-manager or a poor communicator, you at least know and then have the opportunity to make choices about how you’ll fix such gaps early in the process.

On the rational side, the numbers don’t lie. All your key operating ratios are there for you to consider and change – if you want. In many instances audits also highlight the ratios you aren’t aware of: for instance, the ratio of staff salaries to sales. The IBIS report I referred to earlier even contains the industry average wage for you to compare your business against. Whatever the outcome, audits are an excellent idea and bring the opportunities – and often the unidentified threats – facing your business to life

The importance of communication and shared values
The last aspect that needs to be addressed in this overview is the critical matter of communication and shared values. For any change process to succeed, 100 percent open, honest, clear, complete and direct communication has to be at the centre of the terms of engagement for all parties in the process.

Staff and suppliers have to have the confidence to speak frankly and honestly. They have to be sure there are no dire consequences coming their way if they volunteer advice or positive criticism. You can’t take it personally. This will be a huge shift for some retailers. Get agreement from your team on your new and open communication paradigm and you will find the change process will succeed faster than you ever imagined, because your shared values will be aligned and your team will stay committed to your new vision.
– Peter Budd, Budd Consulting

Want to learn more about change?

If you’re interested in changing your business for the better and would like to learn more about the process and costs of change, Photo Counter is planning a luncheon in Melbourne for 10 or 12 retailers (and one beloved ex-retailer in Richard Robertson) for a no-nonsense discussion on change led by Peter Budd. Please email Keith Shipton ([email protected]) if you are interested in taking part in such an event, and we’ll take it from there.


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