Category Archives: Business

What is the cost of quality?

Quality is a subjective measurement that is critical to the success of all products and services. The cost of quality is not the price of creating a quality product or service. It’s the cost of NOT creating a quality product or service. Imagine what the cost in lost revenue would be if a product includes a critical defect that need to be fixed but found after it has been shipped or if a web site like amazon.com would crash. Yet, too often quality is handled in a unprofessional manner.  Read more »

Social media: Business opportunity or playground?

Is your company actively involved in the online communities via social media or have you decided to stand outside? Well the second alternative is not really possible since your company already is present in Facebook comments and tweets whether you like it or not. So, the question should be revised to “is your company actively involved or do you leave the control of your company’s brand on the web to the community?” Read more »

Your employees are NOT your most important resource

Many companies proudly state that “Our employees are our most important resource” but I would like to see the customers as an more important resource beacuse without customers it does not matter how great employees you have, you will not have a successful business. This may be ok for charity work though… I regard a customer as a resource because it is something you have at least some control of, can invest in and develop and if you do not take care of it properly this resource will diminish or fade away.

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Find your competative edge

If the perceived value of two products are the same, price will conquer. Imaging you are looking to buy a melon in the grocery store. You find two melons that look exactly the same but one of them cost 4$ and second one cost 5$. You investigate them a bit further and notice that the first melon is from Brazil and the other from Argentina. If you perceive them to have equal value to you, you will buy the cheaper melon. On the other hand you could choose e.g. Swedish pork over Danish pork even if the Swedish pork is 20% more expensive if you perceive its value e.g. the taste and quality is superior. This is where marketing comes into play. Read more »

Managing a (dysfunctional) team

When I got my first job as a manager at a quite young age I got excited, “This is a big career move!”. I think one reason I got the job was because I had enough tecnical skills and I gladly shared my knowledge with others and trained many people within my area of expertise. I did not really get any management training in the beginning but rather tried to figure it out how to do along the way. I did not like reading books at that time but I remembered a friend of mine who recommended a book called “The 5 dysfunctions of a team” so I though I should give it a try. Read more »

Value based fees – fantasy or future?

Let’s say that you can provide a service to a customer that will save him $1.000.000  per year. What price would be reasonable for this kind of service? $50.000, $250.000 or maybe $500.000? What if your investment for providing this service only cost you about $5000 or let’s say 2 weeks of work. 2 weeks work translates to an hourly rate between $625 – $6250. This is a situation a consultant can come across quite frequently with a traditional hourly based business model. You could think that a price of $6250 per hour is way too high but should we not solve our customers problems as fast as possible? Read more »

Who are your most important customers?

Probably some Swede will state that “all customers are of equal importance” since this is a traditional Swedish mindset. I say this is rubbish! Of course not all customers are of equal importance to your business, the business environment is far too complex for that to be true. It is critical for your business success that you strive to focus your limited resources where it will be most likely to provide the greatest return on investment (ROI). Read more »