Create Distinction: What to Do When

Create Distinction: What to Do When "Great" Isn't Good Enough to Grow Your Business

by Scott McKain


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Product Details

ISBN-13: 9781608324262
Publisher: Greenleaf Book Group Press
Publication date: 03/05/2013
Pages: 264
Product dimensions: 6.20(w) x 9.10(h) x 1.10(d)

About the Author

Scott McKain is the country’s leading expert on business and professional distinction. He is Chairman of McKain Performance Group, a company he founded in 1981 to teach the principles of the Ultimate Customer Experience®.  He is also the cofounder and principal of The Value Added Institute, a think-tank that examines the role of the customer experience in creating significant advances in the level of client loyalty. He has been honored with induction into the Professional Speakers Hall of Fame, and is a member of the Speakers Roundtable, an elite group of twenty business speakers considered by many to be among the best in the world. He has served on the board of numerous corporations and associations, including the National Safety Council.

Scott has appeared on platforms in all fifty states of the U.S. and nineteen additional countries for distinctive organizations such as BMW, Juniper Networks, GE, Merrill Lynch, Nationwide, Cisco, CoBank, HTC, US Trust, and literally hundreds more. He also has made multiple appearances on FOX News Channel and other major media outlets as an expert commentator. Recently, GenJuice named him one of “Top 25 Tweeple Young Influencers Should Follow,” and Social Media Marketing Magazine recognized him as one of the fifty most influential marketing authors on Twitter. Scott and his wife, Tammy, reside in Las Vegas, Nevada and Indianapolis, Indiana.

Read an Excerpt



Greenleaf Book Group Press

Copyright © 2012 Scott McKain
All right reserved.

ISBN: 978-1-60832-426-2

Chapter One


The moment was one of the most surreal that I have ever experienced. A farm kid from Crothersville, Indiana, I was part of a team invited by an international organization, People-to-People, to participate in a goodwill mission. At home, the United States was in the midst of a presidential election between our only non-elected president and a peanut farmer from Georgia. It was our bicentennial year.

But that day I was standing in Red Square, in Moscow, in the Soviet Union—at the very center of communism.

Even though it was September, the day was unseasonably cold and gray. Behind my colleagues and me was the bland and massive GUM department store, occupying a significant space on Red Square. In front of us was the tomb of the father of communism, his body resting inside, appearing almost as a wax figure. Just beyond loomed the sight of the imposing Kremlin. The sentries at Lenin's Tomb goose-stepped their way through the changing of the guard in a manner that I had witnessed only in old black-and-white newsreel footage of the Nazi soldiers in Hitler's Germany. Their precision and efficiency were completely devoid of emotion.

As the ceremony silently concluded, a short, rotund senior citizen stopped me and asked in broken English if I was, in fact, an American. I affirmatively answered with pride in my country yet with a bit of fear as I was certainly in unfamiliar territory.

He opened his coat and pointed to a scar on his chest. With tears in his eyes, he gestured at his wound and said, "From war. Please! No war. No more war."

Wait, We're the Good Guys!

I was stunned. Like most Americans of that era, I assumed the Soviets were the aggressors, not us. Nevertheless, here was an obviously earnest Russian who firmly believed we were the enemy.

Slowly I assured him war was not our intent, and I hoped it wasn't the objective of his country either. I emphasized my colleagues and I were greatly enjoying our visit and were grateful to see his homeland. As someone standing beside him translated my English into his Russian, he broke into a wide, toothy smile and nodded rapidly in agreement.

Just a bit befuddled, I then asked him, "Out of this large crowd, how in the world could you recognize me as an American?"

He spoke to his friend, who then turned to me and said, "Your clothes have color. You are smiling, having fun, as you are in Red Square. That gave it all away."

The fact my clothes were not the standard-issue Soviet gray, and the fact that I seemed to be enjoying myself set me apart from the crowd. It pegged me as someone from another place.

It was a lesson in being different—the lesson of this book.

What I saw in the Soviet Union of the 1970s was the result of conformity and similarity, which is, historically, the natural occurence when the state owns or controls almost everything. The emphasis on uniformity seems to be a constant of every monolithic institution.

However, communism isn't the only political or economic doctrine that produces bland sameness. Ironically enough, capitalistic competition serves just as well.

To truly understand how to create distinction, it's first important to understand why distinction is so rare in today's marketplace. It's why this chapter focuses on the Three Destroyers that created the collapse of distinction.

Taken individually, each of these Three Destroyers of Differentiation creates a compelling challenge. When combined, they have a synergistic and destructive impact on your industry, your organization, and even upon you, professionally and personally, as well.

Differentiation Destroyer #1: Copycat Competition and Incremental Advancement

In our competitive, capitalistic society, the bar is continually going to be raised. We will naturally and constantly seek advantages for our products and services to move customers to choose us over the other guys and gals.

When you are faced with a competitive situation, you've got to constantly get better and provide more compelling reasons for your customers to spend money with you. Otherwise, you will go out of business. (This point shouldn't be surprising to anyone in business.)

However, here's the interesting and challenging rub that's often overlooked: When my competitor creates a point of differentiation and gains an advantage, my natural inclination is to either:

* merely imitate the competition's improvement, or

* attempt to incrementally improve upon the advancement.

If you get slightly ahead of me with a new advancement or strategy, my natural response is to replicate it. If I can discover a method to duplicate your effort, it then becomes easy for my customer base—and for the team inside our organization—to believe you no longer have a competitive advantage.

If your new method has enabled you to gain significant traction in the marketplace, then my best move appears to be to attempt to imitate whatever created your advantage and attempt to marginally do you one better.

In addition, I will probably call my latest effort the "new category leader," built to eliminate your advantage. For example, how many mobile phone manufacturers have been proclaiming their newest product to be the "iPhone killer"? (If we were in Vegas, we would ask, "What's the over/under on ... all of them?")

Notice the problem: in both examples, all efforts are based upon what my competitor is doing, not necessarily what my customers desire. And in most cases, such advancements are evolutionary—not revolutionary.

Unfortunately, if I'm like executives in many industries, I am thinking I don't want to stick my neck out too far—because you may chop it off in front of our customers and prospects. (Since we are competitors, my customers are your prospects and vice versa.) You feel the same way. The result is incremental, uninspiring advancement that appears to be "safe."

In the long run, however, this approach is anything but safe! Instead, what we are doing is mutually destroying any points of differentiation that can better serve our customers and enhance our respective organizations.

It seems to me that the perfect model of capitalism is that you and I compete for the customer. These competitive efforts reduce costs—and therefore the price of our goods and services—while each of us also brings innovation to the marketplace that benefits the client. We continue to strive to meet the client's needs while, at the same time, we grow our respective organizations through the enhanced business we are achieving because of the superior value we are providing.

Yet, in almost every case in the real world, we instead compete against each other. Our focus seems to be directed toward others in the same industry that produce a similar product and deliver similar services, all the while playing the internal political games inherent within any organization.

It's not my desire to offend in any manner whatsoever. However, it is my belief that a significant factor in the demise of General Motors' position of global dominance was their laser-like focus upon the competition—the Toyotas, the BMWs, and so forth—as opposed to being absolutely obsessed with delivering what their customers REALLY wanted. And GM isn't the only automaker who's made this mistake. The traditional players watched one another so closely, it opened the door for newer entrants such as Hyundai and Kia to focus upon customers and make significant inroads into the market.

When Times Become Difficult

Add the element of a volatile economy, combined with more global competition than ever, and our desire is enhanced to play "follow the leader" with our competition. They cut staff; we do too. They close a location; we do too. They outsource a call center, and we're right behind them. All of us pull in our horns, hunker down, and attempt to ride out the busts.

It is simply overwhelming how many companies appear to be focused upon "not losing to the competition"—rather than on delivering what customers crave.

If you follow sports, you are familiar with the stories of the teams that lost important games because they played "not to lose." By going into the "prevent defense" too early in football or by slowing down the game and holding onto the ball in basketball, stellar teams have gotten out of the flow of the game and become so tense, they lost the ability to execute at their normal, highly skilled level of play.

Tennis professional and instructor Ron Waite makes an important distinction when discussing this phenomenon with his students. He tells them that playing "cautiously" is not the same as playing "smartly."

The same point is almost always true in business. When we direct our focus toward the competition, we may become too cautious and seldom execute the smart strategy for winning and keeping customers.

Customers Raise Their Expectations

Customers also play a part in enforcing this kind of incremental advance. They too participate in the first Destroyer of Differentiation. It is part of the DNA, if you will, of our system that the competitive, capitalistic form of economics will also goad customers into steadily, methodically increasing their demands, no matter the economic climate.

The best explanation of why consumers take this approach comes from a close friend of mine, Dr. Michael LeBoeuf, the best-selling author of one of my favorite business books, GMP: The Greatest Management Principle in the World.

His principle is simply this: "Behavior rewarded is behavior repeated."

Consider for a moment how that principle comes into play with regard to customer demands.

Here's an example from the automotive industry: if I work until five o'clock and the service department at your dealership closes at the same time, we both have a problem. I can't get my car serviced, and you can't get my business.

However, if your dealership responds to my situation by staying open additional hours, I am going to reward you with my business. Behavior rewarded is behavior repeated.

It's the first outcome, and it explains why businesses that are rewarded for superior customer service—for example, Nordstrom, Southwest and Virgin Airlines, Starbucks and Enterprise Rent-A-Car, to name a few—become even more focused on strategies that connect them with their customers. Happy customers return and spend more, so naturally the business serving them becomes more aware of the importance of creating those types of experiences because of the rewards of improved sales.

However, the second outcome is a bit less obvious. Because your organization has rewarded my demands as a customer in a manner I recognize to be positive from my perspective (I need extended hours for service, and you've accommodated my request), I will now intuitively feel compelled to make additional demands upon you.

You seem to prize my behavior of increasing my requirements for loyalty, because you've rewarded it; therefore, I—and the multitude of customers like me—will repeat it. It's like the humorous saying "No good deed goes unpunished!"

Why should I, your customer, just relax, content in my appreciation for a service bay that remains open until midnight? Because you have rewarded my request—behavior rewarded is behavior repeated—I'm going to replicate and enhance my expectations.

And, by the way, what else can you do for me?

Doing good means your customers will hasten their demand for you to do better!

Am I suggesting you should stop acquiescing to customer requests and demands? Of course not.

However, you need to understand two important points:

* Customer demands are always going to accelerate.

* This phenomenon is true for you—and your competition.

Therefore, since we are all confronted with a customer base that is accelerating its demands, and if your competition finds you have a point of competitive advantage, especially one that is perceived to be ongoing and sustainable, it is inherent in our system for them to:

* Imitate your advantage (as previously stated).

* Attempt to incrementally improve their product or service (mentioned earlier, as well).

* Or (and here's where a baby boomer like me should announce, "Danger, danger, Will Robinson!") they will cut their price to reduce your superior positioning.

A Dangerous Outcome

What occurs when neither you nor I can think of much more we can do to improve our product or service? What takes place when we do not know the formula to create distinction? What ensues when you have already imitated me as much as you can, and I have already done the same in imitation of you? Here's what happens:

1. You cut your price to develop some point of advantage.

2. I do the same to keep up with your discounting.

3. We both erode our profit margins, which means there are fewer resources for either of us to innovate and distinguish our efforts.

4. We corrode any distinction—and the related goodwill and loyalty—customers perceive about our organization's products and services, which leads to a potential spiral of price pressures, which further diminishes any possibility that we will break the cycle.

As simple as this sounds, I often deal with companies—or management teams or sales forces—that wake up to discover they are on this treadmill with very little perspective on how they got there, and no strategy for how to extricate themselves.

And that's just the first of the Three Destroyers. Combine the impact of this first point with the next one.

Differentiation Destroyer #2: Change That Creates Tougher Competition

If you have not already read it, please allow me to recommend a highly compelling book: Eric Schlosser's Fast Food Nation. After you digest (pardon the pun) his material, I'll wager you won't consume a hamburger for weeks. You may not agree with all the points Schlosser advocates, but I'll bet you cannot put his book aside.

While much of Schlosser's work does for the fast-food industry what Upton Sinclair did decades earlier for meatpacking in The Jungle, I find it highly interesting to view the early part of the book as a real historical examination of what transpired in our country from a cultural—as opposed to a dietary or culinary—perspective. Schlosser outlines how fast-food franchises exploded on the back of the Interstate Highway System. Distribution got easier, and so did copycat competition.

Businesses of every type, from department stores and electronics mega-centers to specialty coffee shops, multiplied in a frenzy of duplication and imitation. Schlosser basically traces the steps that ensured our nation would experience a collapse of distinction.

Taking the Adventure out of Lunch

"In my day," my dad would brag, "stopping for lunch was an adventure." He did not always mean that as a positive point.

Dad meant that as you traveled down a two-lane state or U.S. highway, you'd better keep an eye out for a diner where the truckers were eating. Believe it or not, the common belief at the time was that truckers, who were eating more meals on the road than the average American traveler, would naturally know the best places to dine.

As the son and grandson of truck drivers, I respectfully assert that I have absolutely no idea how our collective thinking became so twisted that those who hauled interstate commerce also became our pseudo-reliable sources of gastronomic expertise. Nonetheless, without a doubt, this accurately describes the thinking of the common person prior to the arrival and rapid expansion of the Interstate Highway System.

When those dual-lane, rapid-transit superhighways opened, travelers whisking down the interstate soon discovered they no longer had to endure the mysteries of Main Street U.S.A. Instead, the new generation of fast-driving travelers wanted to jump off an exit and fill up both their tanks and their stomachs.

I can still recall Dad's unique delight at the fact that every McDonald's was almost exactly identical. A Big Mac tasted the same no matter where you bought it. He quickly purchased cholesterol-on-a-sesame-seed-bun, ensured his kids remained relatively quiet and happy with their meals, and kept the pedal to the metal.

No one in our cramped Chevy dared to complain about the meal, because it was the very same lunch everyone had eaten and liked just fine yesterday, four hundred miles back up the road.

As both conventional wisdom and Schlosser suggest, the other chains that were simultaneously developing and expanding often did not have the wealth of capital on hand to execute the extensive site-selection procedures that became so scientific and strategic at McDonald's Corporation. So these competitors did the next best thing: they bought property as close to a McDonald's as possible to construct their next location. If the area was good enough for McDonald's, it had to be just fine, for example, for Burger King as well.


Excerpted from CREATE DISTINCTION by SCOTT MCKAIN Copyright © 2012 by Scott McKain. Excerpted by permission of Greenleaf Book Group Press. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents

Preface xiii

Introduction 1

1 How We Got into This Mess: The Three Destroyers of Differentiation 11

2 Who Moved My Career? 37

3 Three Levels of Differentiation 53

4 The Ebert Effect 75

5 The First Cornerstone: Clarity 85

6 The Second Cornerstone: Creativity 113

7 The Third Cornerstone: Communication 153

8 The Fourth Cornerstone: Customer-Experience Focus 179

9 More Lessons in Distinction 211

10 Distinctive Is Superior 223

Resources 231

Notes 235

Acknowledgments 241

About the Author 245

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Create Distinction: What to Do When "Great" Isn't Good Enough to Grow Your Business 5 out of 5 based on 0 ratings. 1 reviews.
JimCathcart More than 1 year ago
Most marketing failures result from being too much like everyone else. Scott McKain explains how you can leverage your best qualities or  customer benefits to set yourself apart from the crowd. You'll love learning from Scott. He's fun, intelligent and totally focused on doing what works, not just what seems like a good idea. Read this book first and then explore his other excellent works.