Strategies and Best Practices for Managing ROCE and Cash Flow
CHAPTER 6 TAKEAWAYS
- Manage for profit. Grow through innovation!
- Don't compete on the basis of price. BMW does not compete on price. Their objective is to provide the customer with a complete driving experience. This is of course what many drivers want. However, all drivers can't afford it. BMW knows this and has the discipline to only cater to those who can. This means they have to forgo some customer segments and, therefore, limit the market they serve and ultimately their growth. Your focus should be on maximizing profit and your share of your niche rather than expanding into a broad market if price is what it takes to do so.
- Never compromise your quality. Every product or service a company provides has the company's signature on it. Like a reputation, once sullied it is difficult to remove the blemish.
- You can be high-tech but don't forget how to be soft-touch. This applies to both employees and customers. There is some logic to the notion that in the final analysis, companies get the customers they deserve. If you treat your people well by showing day in and day out how much you value their contribution and train them so that they are able to deliver more value and then show them that you trust them by empowering them to make decisions, you will have a motivated and happy workforce. People who are all gassed up about their company go the extra mile to serve a customer and effuse enthusiasm and confidence ...