Genchi Genbutsu Revolutionizes Selling–Again!


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We know a Toyota Prius can reach ninety miles per hour, but how fast can the company’s management learn from its mistakes? Not fast enough, according to Akio Toyoda, CEO of Toyota, who recently revived genchi genbutsu—the practice of leaving the office and visiting the source of a problem—to help his company restore its tarnished reputation.

Much-maligned Toyota still has something to teach American industry, even though getting people to the source might not be easy. One question is whether millenials in Toyota’s workforce can ignore Twitter, Facebook, and texting long enough to safely operate a vehicle. Hopefully their accelerators won’t stick as they’re driving.

Before social media technology, genchi genbutsu was how things got sold. Except we didn’t call it genchi genbutsu. Most of us called it conducting a face-to-face meeting, performing a walk-through, or making an on-site visit. As salespeople, we were there at the point-of-trouble, where we could see, feel, and understand.

But what worked once upon a time has powerful competition today. A salesperson can just as likely “be present” with a prospect by watching Tweets scroll across a web page or conducting a meeting connected through broadband. One article crows, “the advent of video conferencing technology has opened up new possibilities for conducting fully effective and personalized face-to-face meetings without ever leaving your office.” Pressed for greater efficiency and demands to reduce selling costs, millions of salespeople replace face-to-face sales calls with–well, I’m not sure. Let’s call it something else.

With good reason. According to a survey conducted in 2001, A Comparison of Face-to-Face, E-mail, and Telephone Usage in Industrial Sales: Unexpected Correlates of Sales Success, by Seth Finn, “time devoted to customer contact by e-mail and telephone were correlated with annual sales revenue while face-to-face communication was not.” We can no longer assume that being there will always improve sales outcomes. The author underscores that idea by saying “managers generally believe the assumption that supplying information technology to their sales people will contribute to enhanced productivity as frequency of customer communication increases and customer relationships are deepened.”

But whether technology is truly helpful at deepening customer relations is unclear. Why? Because we’re buried in data, according to a recent cover story in The Economist (The Data Deluge, February 27, 2010), and not every company can cope. Still, the Economist article offers fascinating insights that have been teased from terabytes of 1’s and 0’s:

Wal-Mart discovered that before hurricanes strike, consumers not only expectedly purchased flashlights and batteries—but also Pop-Tarts, a breakfast snack that can be eaten straight out of the box.

Best Buy found that 7% of its customers accounted for (drum roll) . . . 43% of its sales!

The best predictor an airline passenger will post for a flight is whether he or she has ordered a vegetarian meal.

No doubt that for uncovering sales insight, data has great seductive power. But before CFO’s rush to ditch the sales force’s fleet-purchased Chevy Malibu to buy more laptops and cubicles, there are dangers in the allure. According to another article in The Economist (The Net Generation, Unplugged, March 6th, 2010), “not everyone . . . has access to digital technology: many in the developing world do not.” So, when sales organizations embrace social selling, which communities are ignored? What’s traded off? What risks are exposed by replacing being-there-in-person with digital communication? Is it possible that some great sales opportunities are undiscovered because they’re never Tweeted?

In January, a little-noticed article peeped out in between the blockbuster news about Apple’s iPad and Toyota’s suspension of vehicle sales, Dow Chemical Chief Pushes Ahead (The Wall Street Journal, January 25, 2010). Andrew Liveris, Dow’s CEO, was asked “Your strategy to move into more-specialized chemical products means you need to anticipate customers’ needs better. How are you doing this?”

He responded that he was “calling fellow CEOs to enable my sales force and engineers to get access to customers’ marketing and R&D organizations to look at their future needs . . . Every salesperson has to be an evangelist for understanding customer needs and bring back that to our R&D side, so we can make the right choices of where to put our precious resources.” Genchi genbutsu, a-la-Dow—a wicked-smart idea that incorporates rethinking the sales force as a strategic R&D asset.

When asked “have sales(people) come up with any ideas?” Mr. Liveris responded, “Our low VOC coating we use in architectural paints to not only replace solvents but to have low odor. That came out of our sales force. Our people in China have been driving the low odor aspect of that.” Could that insight have been achieved without genchi genbutsu? Probably not. After all, China isn’t the place that comes to mind when you think of free-flowing, web-enabled knowledge sharing.

Referring to the value of genchi genbutsu, one engineer said, “data is of course important in manufacturing, but I place the greatest emphasis on facts,” which he gleans from being on the production floor. For the same reason, leaving the office and visiting the source of the problem is a potent tactic for selling. As Tom Vanderbilt wrote in his recent book, Traffic, “the human cognitive mechanism is powerful equipment.”


  1. Andrew – Thanks for the link to this. I’m still a big believer that you need to get out of the cubicle and occasionally meet with your clients and prospects. Having face-to-face meetings elicits valuable information that can never be delivered by phone, email, Twitter, surveys, etc. It doesn’t mean that ignore technology and social media; it just means that as long as selling has relationship aspects; these relationships are best cultivated in person.

    Patrick Lefler
    The Spruance Group


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