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Extracting Value From Leadership

A few years back, I was working with a major industrial business that was a household name.

Despite the huge recognition of this brand, it was dealing in a commodity market, with increasing penetration of imported product. Our client had a ‘crazy’ idea that no one thought would work. We were fortunate to be part of the team that helped him bring it to fruition, and this is the story of how his leadership translated into a program that had major revenue benefits for several business units in this organisation; plus social benefits for individual customers and the community as a whole.

It proved that, if you are willing to look outside the box, you can achieve commercial success, even when everyone has the same product.

In the middle of the noughties (2000-2010) the industry in question was in the doldrums with declining volume and margins of Australian made product, and more and more imports due to a low Aussie dollar. Our client’s organisation was in deep trouble in their distribution division and in particular with specific brands. One benefit that the business had was they were able to recycle old product into new.

In a team workshop, our client’s Managing Director hatched the plan for a major community-based program whereby the business would scour the country for the recyclable product, buy it back from customers, and turn this into a new product for sale.

With the help of a number of smart operations, marketing and public relations (PR) people, and the internal sales teams, this program got its own brand name, and in a flurry of activity, it was launched with a major Australian country singer as the ambassador.

The program involved connecting local customers, and businesses with the regional charitable groups in each state, along with our client’s local branches.

At a local level, we promoted a buyback of product and mobilised a fleet of trucks to pick up this material either from collection points or off farms in nominated locations. For each tonne collected, they also donated a percentage to regional charities for equipment and other resources.

At the end of the program, the project team had collected literally, thousands of truckloads of product, donated significant monies to the charities and created substantial revenue growth for the client through recycling.

In a very tough market, a simple idea, that many thought was ‘crazy’ and ‘too hard’, generated benefits for the business, the customer and the community. The charities loved it, and the program was a finalist for marketing excellence in the 2006 AMI Awards.

By leading the market with an innovative program that produced both revenue and PR and brand recognition, our client demonstrated, not for the first or last time, that value can be extracted from things other than the product or the channel or the price.

The business was being slammed on volume, slammed on margin and slammed on price. This program took much of this out of the equation and helped many at the same time.

How can you lead the market, and extract value?

Originally published on Smallville.

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