Ecmweb 8155 Electrician 1
Ecmweb 8155 Electrician 1
Ecmweb 8155 Electrician 1
Ecmweb 8155 Electrician 1
Ecmweb 8155 Electrician 1

Use Small, but Think Big

Feb. 10, 2016
A focus on identifying and solving customers' problems instead of lowering prices will help your business grow.

Most test equipment is fairly small. Unfortunately, so is the way the typical shop thinks about test equipment.

Typically, the thinking is based on the type of work you already do or the type of business you already have. For an electrical service firm, this means the business can grow only incrementally by adding more clients (for the same work it already does) than it loses over time. For a maintenance shop, this means the maintenance metrics can improve only incrementally if at all.

This kind of thinking is part of the reason that plants close (high costs because of static maintenance performance instead of big improvements in uptime and cost) and why there is a high rate of failure among electrical service firms.

With electrical service firms, there are many clues that something is wrong. For example, it gets harder to chase the same clients or add new ones, so you lower your price. You get the work, but lose money on job after job. Finally, the business itself just has a heart attack and dies.

alfernec/iStock/Thinkstock

That’s an apt metaphor, and you should think about it when considering your test equipment acquisition strategy. You do have such a strategy, right? Okay, more about that in a moment.

About that metaphor. David L. Meinz is the director of the Executive Heart Program. According to him, the number one killer of C-level (CFO, CEO, COO, CMO, etc.) executives is cardiovascular disease. That may not be particularly surprising. But what he names as the most common first symptom probably is. He says it’s sudden death. [Source: Think Big, Act Bigger, by Jeffrey Hayzlett].

Are you going along with a think-small test equipment strategy that limits your ability to go beyond the “low-hanging fruit” clientele? You know, those folks who have commodity-type work that commands a commodity-type price? You compete on price against other firms, in a race to the bottom. The winner goes out of business first.

People caught up in this don’t see the symptoms. We know this, because their response is to lower their price. They assume a price sensitivity that does not exist.

It’s not price that really motivates customers, it’s the achievement of goals such as X amount of uptime or Y degree of reliability. If you doubt this, consider your own responses in similar situations.

If you work for an electrical service firm, the firm pays a reasonable price to get a reliable service van rather than buying the cheapest one out there. If your van had reliability issues, what would you do? Fix it or replace it.

If you hired a garage to fix it, you’d go to a reliable garage for that work rather than the cheapest one you can find. You’d probably go back to the garage that keeps your vans running, even if some other garage offered you a lower price. Why? You really need that van to be reliable. It costs less to pay a little more for a reliable van than to pay your people to stand around because it won’t run.

Your customers at the ABC Widget Factory really need their production lines to be reliable; how can you think bigger to make sure they get that? Your customers, whether internal (e.g., you’re a maintenance electrician in your production plant) or external (e.g., you run an electrical services firm), need electrical reliability solutions. Not just “electrical work.”

How do you provide solutions? Start by defining the problems you’re going to solve. You can’t solve problems that you can’t define, and you can’t define them if you can’t see them. This is where the test equipment acquisition strategy comes in.

What problems (or conditions) could you solve, if you had the test equipment to see them and thus solve them? How much could you charge for the solutions, and how does that additional revenue compare with the cost of acquiring the test equipment to earn it? Or how much is it worth to have the test equipment to ensure the factory that provides 60% of your revenue stays open?

Don’t stop there with your acquisition strategy. Think of the larger picture. If your company services a particular niche (and it should be servicing a particular niche if you want to command fat margins), what does it take to give clientele in that niche absolute assurance their equipment will run efficiently, reliably, optimally, and whatever other superlatives they can think of? What does it take to provide an assurance that commands a premium price tag and that your competitors can’t (or won’t) provide anyhow? What does it take to provide an assurance that fosters loyalty to your firm?

Maybe your specialty is switchgear design and installation. That’s great. How do you hook customers so they don’t even think about going with a competitor? You could promise them a free thermographic baseline study upon installation (making sure you state the dollar figure value of it) and another free one a year hence. That’s a lot of money to give away, but think of how that not only cinches this particular sale but also gives you a reason to “touch the customer” for additional sales.

Of course, if you didn’t strategize to obtain the necessary thermographic equipment (and the training to be able to use it like a pro), then you can’t do this particular thing. Or maybe thermography isn’t where you want to go. Fair enough. But pick something that you can incorporate into making your firm a level or two above the competition in your market. Make that test equipment acquisition part of a “think big” strategy.

About the Author

Mark Lamendola

Mark is an expert in maintenance management, having racked up an impressive track record during his time working in the field. He also has extensive knowledge of, and practical expertise with, the National Electrical Code (NEC). Through his consulting business, he provides articles and training materials on electrical topics, specializing in making difficult subjects easy to understand and focusing on the practical aspects of electrical work.

Prior to starting his own business, Mark served as the Technical Editor on EC&M for six years, worked three years in nuclear maintenance, six years as a contract project engineer/project manager, three years as a systems engineer, and three years in plant maintenance management.

Mark earned an AAS degree from Rock Valley College, a BSEET from Columbia Pacific University, and an MBA from Lake Erie College. He’s also completed several related certifications over the years and even was formerly licensed as a Master Electrician. He is a Senior Member of the IEEE and past Chairman of the Kansas City Chapters of both the IEEE and the IEEE Computer Society. Mark also served as the program director for, a board member of, and webmaster of, the Midwest Chapter of the 7x24 Exchange. He has also held memberships with the following organizations: NETA, NFPA, International Association of Webmasters, and Institute of Certified Professional Managers.

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