Most building materials companies feel the greatest risks to them are the economy, construction activity or competitors. Things that are largely out of their control. This means they are allowing outside influences to control their destiny rather being in charge of your own destiny.
The biggest risks or threats a building materials company faces are internal. This means you can decide to minimize these risks for your company. Since your competitors face these same threats, you can turn these into a competitive advantage. These threats have more to do with culture and willingness to change than product, pricing or marketing budgets.
Building materials companies are at least ten years behind other businesses when it comes to marketing. Part of the reason is people in building materials companies are too comfortable.
Most of them make a comfortable living and have their jobs figured out, so they are not too stressful. They know how to play the game and impress their boss. They tend to be able to establish the metrics that they use to show the boss what a good job they are doing. And if the metrics don’t look good, they just change them. Here’s a great example of this.
In the consumer packaged goods industry, the measures of success are set by the boss, and there is no deviation. If you don’t hit your numbers, you will be replaced. Building materials people, don’t feel this pressure. That is why there is not enough turnover in building materials.
The two biggest things are not to rock the boat and to try not to be accountable. New ideas may make a senior person less relevant. They may have to learn a new approach that means they have to put themselves at risk and work hard again.
People are resistant to be held accountable for meaningful measurements such as sales or margin increases, especially if they are a stretch.
For management, the tendency is to see change as a problem. I know the people we have, they know our products and processes, they are good enough. Where would I find a replacement and would they be better? This is usually caused by overrating the importance of product and company knowledge and underrating the value of change.
Focus can be a good thing when it is directed to focusing on a market or type of customer. Focus may not be so good when it is used internally. When building materials companies seek to solve a problem or make a change, they see it within the silo of customer service, sales, marketing, or technical support, etc.
Rather than seeing the solution by focusing on the most obvious silo, you need to take a landscape view across all of the silos. You need to see the solution the way your customer sees and experiences it.
Your customer sees the entire package when dealing with you. They don’t differentiate between the silos. Just like your logo is not your brand, the way your customer views you is not just one silo, like marketing.
Focusing on solutions through individual silos also results in a lot of meaningless measures of success.
“We now answer calls by the third ring.”
“The open rate on our emails is now over 30%.”
“We got 400 leads at the trade show.”
“We’ve reduced warranty claims by 20%.”
All of these are nice to hear but too far removed from, “Our sales went up 6%.” They give you the false impression that things are actually getting better when they probably aren’t
Two other reasons I frequently see this lack of a landscape view in building materials companies are the fault of the leaders. They allow bad behavior and resist the challenge of fixing it.
The first is how frequently where I see leaders of departments who don’t like or are threatened by each other. It’s just easier for the leader not to make them work together or call them out when they take a passive aggressive shot at the other. Don’t put up with this if you want to outperform your competition. It’s a lot cheaper than a new $100,0oo marketing program.
The second is where people have decided this is the best they will do in their career. They conceal information in an effort to make themselves irreplaceable for job security. They can also make themselves difficult to deal with and resist change. Other people then avoid these people even when they know the solution is in that department.
Every good leader knows no one is irreplaceable as they could be hit by a bus tomorrow. Leaders should hire people with confidence and insist that they are sharing their knowledge and training their replacement.
When you think of the best run companies such as Apple, Amazon or others, do you think they put up with any of this behavior? Being more open to change, having a landscape view of silos and expecting a high level of employee performance, will really challenge your competition to keep up.
Contact me if you’d like to learn where you have some internal blind spots that are holding you back.