Back in the Box

I can't count the number of times I've been called by companies searching for a miracle cure--a speech or a day's consulting to help them "get out of the box." Invariably, what these firms really need--and what I'll venture most organizations on the lifeless American corporate landscape could stand--is to get back in the box.

In their endless rush to embrace the next big thing, too many businesses have forgotten what they are and what they really do. The fashionable compulsion to break with the past has, bizarrely, come to mean abandoning the true value they once offered customers.

The latest evidence comes courtesy of Volkswagen of America, which has, over the past few years, lost the plot of its own brand story--efficient "people's" cars with minimalist interiors and mechanics. Expanding its offerings to a luxury sedan and an SUV, and filling its most basic models with plastic and padding, VW turned off its core constituency. Meanwhile, BMW rose to fill VW's abandoned niche with its Mini Cooper: simple, solid, and small. So after four years of declining market share, what does VW do? It hires Mini Cooper's advertising agency!

It's as if companies can't fathom that the most powerful link they have with customers is their products themselves. A car company says more to its customers with the placement of its cup holders than it does in any TV advertisement. A credit card company communicates to its users through the privileges it offers--not some silly online Seinfeld "Webisode."

It's time for business to reverse this trend toward fragmentation and instead integrate its products, communications, and marketing. This means identifying the one thing you really do best (hint: It's the business you're already in) and letting this core competency guide your decision making. Your next big thing should really be a new beginning--a chance to do what you do, and do it incredibly well. Make it fun again.

Getting back in the box fills many corporations with dread. Why? Because they've outsourced, even abandoned, their core competencies. Dell built a computer empire on its ability to assemble components and the promise of reassuring customer service from acres of highly qualified reps sitting in Round Rock, Texas. Now it farms out technical support to the phone banks of Bangalore, just like any other computer company.

Our disconnection from the essence of our businesses is a sad side effect of the Industrial Age. Mass production required a mass media to do mass marketing as efficiently as possible. The factory floor manufactured goods in discrete, separate steps. Customers were viewed as target markets to be stimulated into purchasing behavior. And managers were reduced to balancing the spreadsheet, even if that meant separating themselves from the people and processes making and using their stuff.

Companies operating inside the box understand the value of that connection. More than any ad, it's your products, employees, and end users who promote on your behalf. Not because of any clever viral marketing campaign but because people actually like your products and want to belong to the culture that developed them. Paris

Hardee's thought a half-naked Paris Hilton would help sell more burgers. What it really needed was a better burger.

Hilton looked marvelous in TV ads eating a Hardee's burger while soaping up her car--but the chain's sales grew less than they did the Paris-free summer before. Could it be that a better burger would have connected with more customers?

While the Gap--run by a CEO proud that he has never worked in the apparel business--continues to deluge the airwaves with ads for ever thinner slices of the demographic pie, upstarts like H&M and Zara communicate through their clothes. They understand that their job is not really fashion, but copying fashion as quickly as possible--so their in-house just-in-time design and manufacturing processes are rapid enough to get facsimiles of runway pieces in stores before fashion magazines can run photos of the originals. Zara gets its copies into stores before the originals make it out of the factory!

A business culture like H&M's or Zara's would never outsource its core processes, however grand the short-term savings, because doing so ultimately leaves no one who knows how anything gets done. Rather than writing them off, companies in the box treat employees as a community of people who actually like what they do and want to do it better. They create incentives that reward innovation with the opportunity to participate more directly or with greater autonomy in the core enterprise. It's employees, after all, who spawn innovative products. And it's employees who communicate a brand's true values to customers.