Human Resource Inflection Point Testing

Inflection Point Testing

In past blogs, I have discussed how businesses should always begin with an idea that is tested to see who will buy, for how much, and whether the exercise can be repeated. Small businesses must retain this way of marketing, constantly testing new offerings to new segments while the company continues to market the things that make them revenue today. A lean marketing practice must work to quickly map the buyer’s journey and test campaigns with customers to discover what performs.

Marketing action plans should include testing for inflection points. Rather than thinking of customers buying products and services, companies should strategically consider the outcomes customers want; in effect, clients are “hiring” products and services to achieve those outcomes. What becomes clear when looking through this lens is that outcomes can be achieved in many ways and do not always conform to traditional industry boundaries. This is why companies should always be looking out for inflection points that require changes to their business model…a pivot. Always testing for inflection points costs less and provides a process of a tested business model evolution rather that huge spending to catch up or becoming irrelevant and going out of business when hit with an inflection point such as the do-it-yourself (DIY) customer.

Real paradoxes exist in the consumer market today. As Home Depot and Lowe’s power ahead with do-it-yourself (DIY) doers, other brands are powering ahead by doing things for clients. Amazon brings their customers products. Grubhub and Uber Eats bring their clients restaurant foods. HelloFresh delivers meals that people can quickly assemble and serve. Alexa and Siri answers questions. DIY is now a multi-dimensional inflection point concept. The new definition of DIY revolves around the effort customers are willing to expend to feel they created something on their own. Some people are all in with effort; others are willing to delegate. DIY will be different for each brand. As was learned in the 1950s, it is about how “made from scratch” is defined. Does baking a cake from scratch mean the DIY cook needs to start with the individual ingredients? Or do they start with a boxed cake mix and just add an egg.

DIY is being re-developed in real-time…thus, it is an infection point for many. Brands such as Home Depot and Lowe’s are leveraging their customers desires to remodel by themselves. Other brands are leveraging their customer’s desire to have things done for them. The former takes some effort and talent; the latter takes an app. Companies need to remember that personal effort is a continuum: how much personal effort is a brand’s customer willing to exert to make something happen…marketing inflection point testing has helped answer this.

The pandemic forced inflection point testing into real-time pivoting by some companies to determine where their brand could be successful with the changing customer buying experience. For some, this was expensive but the pivot had to be done for survival. For others who had been doing inflection point testing, it was easier to make a successful less costly pivot because they knew from past testing what could work. Salesforce surveyed 2,500+ global small/medium businesses (SMBs) about how the pandemic impacted their strategies and values. Covid lockdowns forced retailers to shift online: 75% of the SMBs polled by Salesforce said their customers now expect them to offer online transactions; 72% of the companies have an e-comm operation, and 35% of them implemented it just within the past year. 71% say their business survived because of digitization. Technology also helped SMBs survive by providing customer-service software (currently, 53% of SMBs use it) and protection against cyberattacks (95% of SMBs made moves to secure company data and protect customer info). SMBs changed to offering their customers contactless services (91% of retail SMBs will use these permanently). A survey by Salesforce found that 43% of surveyed businesses said they’re implementing technology and e-comm for customer safety, while 32% said they want to provide safer working conditions. The consumer buying experience changes look like they are here to stay. For instance, people will increasingly want a high-tech front-end restaurant ordering experience. Just notice the investment McDonalds is making in that area. Customers who value fast are demanding more service roles replaced with automation…just look at the number of “chat bots” that are showing up today on company websites to answer customer questions.

Now, many business owners think only in terms of customers when the topic of inflection point testing is brought up in conversations. However, in a post-pandemic world, maybe owners should be looking at human resource inflection points that will affect their businesses. For instance, mass turnover is happening from workers reevaluating their lives and their careers, and no company is immune…the Great Resignation is here. As employees return to the office and are confronted once again on a daily basis with annoying personalities and the grievances of office-life, they may also decide the money just isn’t worth it. Gallup research found that 50% of employees leave their jobs “to get away from their manager to improve their overall life at some point in their career. Just 3% of white collar workers want to return to the office five days a week, according to a poll by management consultancy Advanced Workplace Associates, which warned employees will quit if bosses force them back full-time. A full 86% of employees want to work from home at least two days a week, the consultancy said after surveying nearly 10,000 people around the world across areas including finance, technology and energy. All age groups felt the same way, they added. Workers reported a preference for commuting into cities on Tuesdays, Wednesdays and Thursdays, raising the prospect of empty offices for the rest of the week. Workers have seen that flexibility can work and bosses who are not sensitive to their employees’ needs will suffer accordingly.

Human Resources is a business area where inflection point testing can yield positive results. For instance, some companies are offering “next day job offers” to attract workers and different incentives including up-skilling programs, tuition reimbursement, and cash bonus programs. Few of these are tested before they are offered. So the immediate business owner question is whether these incentives are achieving the human resource results that small business needs to remain a viable company. You might be surprised to discover that most companies fail to track the outcomes of their hires…only about a third of U.S. companies report monitoring whether their hiring practices lead to good employees. As Peter Capelli writes for Harvard Business Review, “Imagine if the CEO asked how an advertising campaign had gone, and the response was ‘We have a good idea how long it took to roll out and what it cost, but we haven’t looked to see whether we’re selling more.” Almost unthinkable. Yes, there are may be ways to curb the revolving door of turnover. Communication is key; leaders should regularly be trying to identify which possible new hiring practices (like flexible working, mentorship programs, and rewards systems) could work to find and retain workers.

Another human resource area where inflection points need to be anticipated and tested is in the definition of work place culture. Ask six people to define culture and you’ll probably get twelve different answers. Culture will vary, location to location, company to company, industry to industry. It’s never one-size-fits-all. Culture needs to be lived, breathed, and experienced every day. We all know the questions people ask as they weigh whether to stay in their current jobs or pursue new opportunities: What is it like to work there? What’s the culture like? What are the people like? How will I fit in? Culture is on the walls and in the halls and, most importantly, should in the hearts and minds of every employee. Elusive to define, powerful when deeply felt, it is best experienced together and this is the area company leaders need to be looking for inflection points. A company’s culture (the unspoken rules of how everyone in the organization works together) is critical, but the evidence is thin that culture is confined to a physical place. I’m convinced work has become a state of mind more than a place to be. As such, if you have the right state of mind, including motivation and support, you can likely work from anywhere. Indeed, it may be the difference between people staying or going.

Now for another thought about a human resource inflection point that is just hitting the US. It’s the next progression from the work-from-home movement. At first, it was moving away from hubs like San Francisco and New York to less expensive locations but now this trend may be worldwide. Fast growing startupDeel (a company that does all of the back office paperwork to make remote work happen seamlessly) is leading what may be a transformative work and societal shift. By taking care of all the taxes, regulations and onboarding of new hires, they’ve unlocked talent around the world to apply and remotely work for companies anywhere in the world. This may have far reaching consequences since no longer will an employee be forced to work at a job only within commuting distance. Future workers don’t have to leave their family, friends, and country behind to join a company in the USA. Businesses that offer a remote-first distributed workforce can recruit and hire anyone in the world. This enables companies to have workers across the globe. Is this an inflection point where everything changes for workers, businesses, cities and countries? Business owners need to be testing new hiring practices and evaluate the outcomes of their new hires.

Just as small businesses are using the inflection point analysis in marketing by constantly testing for new offerings, business owners need to start using this same technique to identify the human resource model changes that are needed to keep and improve their own employees. Remember, the company “brand” is both the products/services and its employees that address the needs of the customers. Owners should be sure to include inflection point testing in all areas of your business including human resources.

For more thoughts about inflection point testing read the blog entitled Pandemic Inflection Point Testing.

Copyright ©John Trenary 2022

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