Five Questions Every Company Should Ask Itself

Sometimes we forget the basics.  And sometimes the greatest insights come from the truly hard questions.  Peter Drucker, the business guru you always meant to read, said “One does not begin with answers. One begins by asking, ‘What are our questions?’”

So here is my modest list of questions that all companies should ask of themselves.

1.  Why are we here?  As I counsel with companies, they spend a lot of time looking in the rear view mirror, rather than looking ahead.    Some companies may have lost their curiosity about the world around them.

Are they still relevant?  Pepsi obviously spent a lot of time working on a new bottle and label, but their true questions should be how do we continue to make beverages that are relevant to the younger generation.   According to Keith Yamashita of design consultancy SYPartners, we’re coming off an era of “small-minded questions” geared to efficiency: How can we do it faster, cheaper, where can we cut? “But in order to innovate today,” Yamashita maintains, “companies must ask more expansive questions.”

2.  What business are we in?  Many times I hear the truth of what business companies are in from their clients.  Recently, I was speaking to women about interior design.  Their interior design professional did not sell them interior products; what they sell is personal confidence and status.  The clients are buying an antidote to fear – fear of making an expensive or inappropriate mistake.  Wonderbra says, “We do not sell underwear. We do not sell lingerie. What we sell is self-confidence for women.” Harley Davidson does not sell motorcycles. It sells the concept of freedom to middle-aged men.  Xerox learned that they did not sell copies; they sold distribution of information.  What is the truth of your business?

3.  What are we doing, that our competition is not doing, that our customers want?  It is the classic positioning question, but it is also the key relevance question.  If all of a sudden, your clients feel that conspicuous consumption is not appropriate, you won’t be selling many obscenely lavish items.  If your competition is providing a higher quality product at a lower price, the consumer will find out.  The internet has made positioning more important than ever.

But do you offer such wonderful style and service that consumers just feel better about you?  Or do you have a cause like Toms that makes consumers instantly identify with you?

4.  What are we willing to give up or do differently?  Many companies are facing questions of ethics, technological change, generational issues and more that cause them to make really difficult decisions.  Whole Foods makes decisions every day based on issues of animal welfare, human harvesting of seafood, organic agriculture, food safety and sustainability.  They have a mission and are guided by it.  Companies like Chipolte and Starbucks are willing to give up business practices to embrace their mission.

5.  Where are we going?  Maybe the toughest question of all.  Because it implies that change is constant and that is a bummer for many.  Creating a culture of innovation is important for today’s world.  Take this example.  Kate Spade (if you don’t know who she is you are not a woman) has a new store concept in Japan.  Every Saturday, it releases an article of clothing you won’t find anywhere else. The goal is to make the store a weekly excursion for millennials who might otherwise be online shopping.  To overcome the high cost of replacing signage on Saturdays, a group decided to make all the signage digital on iPads.  Plus offer enough information to engage the millennials.  The store makes back the cost of the technology investment in just two months.  On the other side of the coin, online retailers like Warby Parker, eBay and Piperlime are trying out retail showrooms, still with an emphasis on online purchase.

Businesses moving from the 20th Century to the 21st Century have new and different challenges.  Asking questions is the beginning of a new future.