Spreading the Word
Are your internal processes or actions creating bad word of mouth?
Years ago, I went to a communications conference in Chicago where a Japanese quality executive discussed the reason behind Japanese companies’ relentless pursuit of quality. He said it all boiled down to word of mouth. Japan’s cities are densely populated. Residents use mass transit and live in apartment complexes. This executive said their studies had found that when a domestic consumer had a bad experience, they were likely to tell at least 10 people on their way home from work. Having lived in Japan, I agree with that assessment and that imagery remains in the back of my mind.
The internet has exacerbated this phenomenon. Recently, I had a client who was looking for lead database options. Other clients had said good things about a database they were using, so I did a search and came up with two options: the one with positive word of mouth and a much cheaper option with good online reviews. The first vendor I contacted required watching a demo to obtain pricing and details. Their salesperson ultimately discounted the annual price based on the low volume lead search needs of my client.
The second vendor shared pricing info and service descriptions on its website, no demo required.
I put both recommendations in my marketing plan. The client opted for the one with positive word of mouth. But, they then visited the vendor website, did the demo, and a different salesperson quoted a much higher price. My salesperson then told me he couldn’t honor his earlier quote because my client was now associated with the other salesperson. I explained that if they didn’t honor the original price, we’d look at option two.
Long story short, I did a demo with the second option. They had all the services my client needed for thousands of dollars less. The salesperson recorded the demo, which I sent to the client. My client signed a contract two days later. Since the two other clients were coming up for renewal with the more expensive database vendor, I shared our positive experience. The pricing difference has them very interested.
In short, bad word of mouth tied to my experience may be tracking to three wins for the second database vendor in less than two weeks. The first company’s inflexible process killed an order at the PO stage.
How does this track to the EMS industry? This is still a small, niche industry, so word of mouth travels quickly through EMS personnel, OEMs and the supply chain. During my EMS sales career, I heard many stories from OEM sourcing personnel about bad experiences they’d had with EMS providers they would never return to. As these supply chain professionals moved among companies, that “will never use” perspective killed multiple opportunities. I’ve heard stories about bad employee exits that effectively blacklisted them from good opportunities. I’ve also heard stories about bad employee treatment policies that limited the number of experienced people willing to work for them. In short, bad experiences get talked about and often have far-reaching consequences. Here are a few examples of bad policies/behaviors that generate buzz:
- EMS companies forcing a standardized PCB layout beyond what customers are easily able to accommodate (while this is a good Lean process control policy, it will generate bad word of mouth from customers unwilling to make the changes)
- EMS companies with a track record of mass sales team layoffs to reduce commissions. (This doesn’t mean you don’t lay off poor performers, but when the entire team is repeatedly recycled every two years, it sends a bad message to experienced salespeople.)
- Job candidates who accept a position and then ghost the company either on the planned first day of the job or within two weeks
- Job candidates who accept a position and use it as a hammer to increase compensation in the position they really want, and then tell the first company they got a better offer
- EMS companies that solicit bad-fit business in a recession and then ask those accounts to leave when the business situation improves
- EMS companies that automate communications processes to the point where customers only get voicemail.
Some of these examples, such as PCBA standardization, commission mitigation methods and automated phone systems have good internal justifications. All of them have the potential to improve profitability in terms of the costs they cut. When carried to extremes, however, they also generate bad word of mouth that often eliminates good opportunities. Consequently, when considering implementing these policies it makes sense to look at them from a customer or employee perspective. Does some flexibility make sense? Will the potential downside of being inflexible tarnish the brand in ways that cost more? In the case of product design standardization, is there a way to sell versus tell to motivate the needed change? Can you improve screening processes so that customers not likely to fit the standardization requirements aren’t being quoted?
Within the employee behavior examples, there is no upside potential. You tarnish your brand within the EMS industry when you do this. Getting a better job today using this behavior just guarantees that if you need to move quickly in an industry downturn, there will be fewer opportunities.
The bottom line is that in today’s interconnected world, word of mouth travels fast. When you have policies that generate customer or employee angst, review them to determine if more flexibility or better opportunity screening is needed. Evaluate the experience from the perspective of the person who will be impacted. In terms of career choice, recognize that your behavior as a job seeker is part of your brand. Companies are making a significant investment with every hire and at higher levels are rejecting other equally good candidates when you accept a position. Walking away from that commitment puts the company in a bind, so don’t accept a position you aren’t willing to stay in for at least a year.
Susan Mucha is president of Powell-Mucha Consulting Inc. (powell-muchaconsulting.com), a consulting firm providing strategic planning, training and market positioning support to EMS companies and author of “Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services.” She can be reached at email@example.com.