In Chapter 3, we told the story of a competition that Anontus Engineering Group won because it had a sound technical solution and because it outbehaved its competitors. As this book draws to a conclusion, we are returning to Anontus because, in many ways, this company represents a solid B2B company that understands and values behavioral differentiation. We asked Erich E., a program manager for Anontus, what enabled Anontus to sustain BD. Here is what he told us:
Being a relationship-based company (and not a transactional one) shines a bright light on our behavior toward our customers as a key to success. Along with following our internal standards, guidance, and procedures for successfully executing a project (essential to customer delight, to be sure), building and advancing that customer relationship receives at least equal emphasis. And what generates and sustains a relationship but communication and behavior?
Successful people in Anontus walk the talk of these customer relationships. We firmly believe that our relationship-based business model is a strong differentiator for us in the marketplace, especially as we see the technical capabilities of competitors rise—in part through advances in and deployment of technology and in part through industry consolidation and the aggregation of disparate specialty firms into more formidable integrated ones. We find that our behavior toward customers more and more sets us apart from our competitors. That behavior includes such things as active listening; getting in the customer’s head and understanding his drivers and fears; and then putting that understanding into action—demonstrating the flexibility to accommodate change or adapt to a client’s idiosyncrasies, solving problems in a balanced and responsible fashion (not caving in to the client when it doesn’t make sense for the project or the business relationship), and going beyond stated requirements and creating outcomes that meet the real needs.
It includes the highest standards of business conduct. Anontus is an extremely ethical firm. We also take particular delight in making our customer a hero in his world: earning through our performance an award, bonus, or other recognition for him, not us; and getting him promoted by his employer. Relationship-based business behavior starts long before a contract is signed, of course. Anontus’ sales people are some of the most ardent practitioners of building and advancing relationships with clients. A big part of our job is to get to know the customer and his business well before any particular business opportunity is known; to create a relationship in the work context; and to advance the relationship by adding value for the customer in each interaction. What a customer observes in his relationship with the Anontus sales representative creates in him an expectation of the behavior he will enjoy with us on a project.¹
Companies that distinguish themselves through behavioral differentiation are self-conscious about their behavior. Moreover, there is never a point where they have arrived at the mountaintop and have no farther to go. Their smarter competitors are watching and learning and doing what they can to raise the behavioral standard—or smarter companies in other industries are raising the standard, and customers keep learning what else is possible. The smarter companies never rely on their technology alone because in today’s markets it won’t make a lasting difference, as Erich E. explains:
Technology is rarely a differentiator in our markets. Many firms can deliver a highly satisfactory technical service. The difference is people and that difference is manifested in behavior. Our experience tells us that long after a client forgets the details of a particular project, he remembers the positive experience he had in working with Anontus. Calling it by another name, Anontus has successfully practiced behavioral differentiation for years. Have we perfected it? Of course not. Have we fully capitalized on it? No, we have not. We have much to learn, and we have the happy circumstance of needing to spread the gospel to new parts of the company that have joined us through carefully chosen acquisitions in recent years.²
Throughout Winning Behavior, we observed that behavioral differentiation cannot take the place of outstanding products or services and excellence in execution. It’s not a panacea for poor business performance in other areas. However, if you have a well-oiled machine in other respects, then BD can lift you above your competitors who also have well-oiled machines but are not insightful about the use of behavior as a competitive tool. Ken Bailey, a smart and successful businessman until his retirement a few years ago, made this observation about BD:
Positive behavioral differentiation will certainly extend the lifespan of a relationship but only if the technical side delivers—every time. BD with outstanding service will live long. BD with average or poor service will be short lived. Having good relationships through good BD will probably help you survive a short period of poor performance and may give you a second chance where it would not be otherwise. In summary, good, positive BD is always a very good asset. It is never a negative.³
Behavioral differentiation offers you an extraordinary opportunity to improve not only your business development—from opening game through next game—but to create an enterprise that attracts and retains loyal and talented employees. Why? Because people want to feel that their life and work have meaning, that the organizations they are part of care for them, and that the work they are doing is valued by the people receiving and using the products and services they create. People also like working for winners, and when you can sustain behavioral differentiation over the long term, you create the kind of strong cultures that have sustained winners like Southwest Airlines, Men’s Wearhouse, Ritz-Carlton, Nordstrom, Anontus Engineering Group, EMC, Hall Kinion, Centex Construction Company, Marshall Field’s, and Harley-Davidson. To join that elite group, you just need to create a behavioral advantage.
1. Are you more like Wile E. Coyote or the Roadrunner? Are you wielding the frying pan or being smacked in the face with it? In other words, are you aware of the competitive advantages inherent in behavior toward employees and customers? Assuming that this is true, what are you doing about it?
2. Take the BD survey yourself. Look at Tables 11-1, 11-2, and 11-3. How would you have ranked these items or answered the questions? What would your results indicate about your company?
3. What values truly drive your business? Are those values consistent with behavioral differentiation? Or do they block you from behaving in ways that might differentiate you positively from your competitors?
4. It’s time for action. What can you do to establish or improve your BD? What will you do?
*Look, for instance, at Fortune magazine’s annual lists of Best Companies to Work For and Most Admired Companies. The organizations at the top of these lists typically excel at behavioral differentiation, especially those appearing on both lists.
*For a lengthy discussion of these drivers, see chapter 9 of Terry R. Bacon and David G. Pugh, Winning Behavior: What the Smartest, Most Successful Companies Do Differently (New York: AMACOM, 2003).