I recently was visiting a custom builder in Michigan that was in the middle of transforming into something more akin to a production builder. You could feel the organizational stress in the air with so much change underway. When a few moments opened up in our schedule, the head of operations and the design studio pulled me aside to ask “what software can fix this and make it better.” We both knew she was grasping for a silver bullet—and it was up to me to disappoint her. “You shouldn’t be looking at introducing any new software yet,” I said.
It is because of interactions like this one that I understand why you might think that I am anti-technology, but that couldn’t be further from the truth. The right piece of software will be an enormous help to this small organization, but only if the team implements it at the correct time. This leader was in the middle of changing nearly every process and procedure for how the business functions. Until she knew she had a new process that worked for both internal and external customers—adding technology would have been a distraction. Implementing new software takes a massive amount of organizational energy. And every time you perfect the process based upon feedback, the progress you made with the software may need to be undone before it can be fixed. In this situation, the company needs to innovate first and then add technology to improve speed, reliability, and certainty that the best possible customer experience is predictably repeated.
Do You Want to Become Extinct?
No one likes the feeling of being behind, and, when you use a word like extinction, the stakes are raised. Fear, uncertainty, and doubt (FUD) are the primary sales tools used by tech providers to home builders and developers today. Fear that a competitor will pass you by, uncertainty about how good your current approach is, or doubt about your ability to even know which way to approach a particular problem—combined with a dose of “our industry is so slow to innovate, here’s your chance to lead.” After all, if FUD can’t get you to move forward, then perhaps an appeal to your ego will.
While these sales tactics can be quite effective, there is one small problem—it’s almost never true. For example, most individuals would agree that a robust customer relationship management (CRM) system is a critical component of sales success and without it you’d eat your competitors’ dust. However, one of the top 10 builders in North America still has most of its divisions using Excel as their primary CRM tool. Could things be improved with the adoption of a true CRM? Absolutely. Should they rush to do so out of fear, onboard a system haphazardly without confidence it will work, and put billions of dollars in revenue at risk all at once? Probably not. I wish more home building leaders approached technology as an iterative approach instead of a revolutionary one.
A builder I work with once considered marketing a three-year “bumper to bumper” warranty on their homes as a differentiator. That is innovating thinking—and could have vastly improved customer satisfaction and referrals. The builder planned to ramp up the number of warranty techs and service vehicles to handle the expected increase in volume of work. The pitfall was that it was looking to scale and expand an existing process that, in the words of one executive, “sucked.” In a leadership meeting only weeks until the new initiative would go into effect, someone asked, “so we’re going to extend the one year of crappy service we offer to three years of crappy service?” The concept of expanding was scrapped in favor of digging in to how to deliver a vastly improved single year of service. That was a smart decision. Investing resources in a suboptimal solution severely limits your return on investment unless you are willing to fix the underlying processes first—then you scale it.
3 Great Reasons to Invest
At Do You Convert, we’re all about innovation and technology. I’ve created a three-part Innovation Framework for helping us—and our partners—determine when it is worth investing in new technology.
1. Is the existing process already successful? Will adding technology free up time and energy from mundane tasks in order for your team members to deliver a more human experience?
Think of the last extremely positive moment that you had as a customer—do you credit a human or a machine for that experience? We expect technology to work and get out of the way. We expect human interactions to stand out as exceptional. That requires time and mental energy that technology can unlock for your team.
2. Will adding this technology solve a problem for both internal and external customers?
Since resources are always limited, solving a problem for both groups at once is usually a home run. Every opportunity won’t pass this test, but, if it does, you should usher it to the front of the line. Be extremely cautious of solutions that only solve a problem for your customers as it is easy to discount the added weight of maintenance and support by your internal team. Don’t just look at the expense in dollars but in the amount of ongoing energy it will require from your teams. Often the best answers do require you to increase internal headcount, not shrink it.
3. Will this solve an issue in today’s and tomorrow’s market?
Due to the huge effort in implementing technology, don’t chase after something that only works in the current environment. Zoom out a bit, and consider how it would work in a period of time like 2008 to 2010. Would it still be necessary at all? Would you need to actively undo it in order to head in another direction entirely?
Keep Your Promises, Know Your Why
The business of technological innovation deserves far more in-depth thought and planning than we often dedicate. Look for the signs of FUD, and counteract it by filtering through the three-part Innovation Framework. Above all, make sure you have a complete understanding of the “why” behind the need for innovation, and understand that because your competitor is doing it is a terrible reason on its own. Finally, make sure that technology allows you to keep your promises to your customers and team members. That means it must deliver. Using innovation as a buzzword will ultimately hurt your brand if you can’t. If your tech can’t meet or exceed expectations, maybe you should keep it in the lab for testing a bit longer or dial down the marketing that overpromises the impact.
