Get the Government on Your Side

By Lain Ehmann

Government regulation and business don’t always go hand-in-hand, but according to Wharton Business School professor G. Richard Shell, salespeople can change that. Shell, author of Make the Rules or Your Rivals Will (Crown Publishing, 2004), says government standards and regulations actually can make it easier for companies to establish a competitive advantage – and the salesperson is in a critical position to make that happen. Here Shell gives tips for setting rules for existing and new products.

Existing products. “Every complex product has maybe 5 to 10 different standards that apply to it,” says Shell. Whether from large or small governmental agencies or nonprofit groups, these standards and regulations can elevate you to best-in-class provided you’re working with the regulatory agencies, not against them.

Shell gives the example of the air conditioner manufacturer, Amana. The current administration was considering lowering the environmental standards for air conditioners, a move the air conditioner industry was largely in favor of. But Amana, realizing that a lower standard would actually hurt the company because it currently met the higher requirements, broke with its industry and came out in favor of maintaining the higher standards. As a result, consumers saw Amana as good for the environment. “They got a selling proposition on being environmentally friendly that their competitors couldn’t touch,” says Shell.

New products. When new products are in development, your company can lobby federal, state and local agencies so you can come out on top, says Shell. Sales can serve as a lightning rod within your organization, communicating to other departments how important it is to work with the regulatory agencies. “Sometimes it takes some effort to mobilize the internal folks who interface with the legal standards and regulatory makers, but once you do good things start to happen,” says Shell.

Shell tells another story about how Goodyear Tires successfully worked with regulatory agencies while the rest of the tire industry went against the idea of a new tread standard. “The standard ended up being written to describe the Goodyear tire. It became a great differentiator in the marketplace,” says Shell.

So what can you do to duplicate Amana’s and Goodyear’s success? Talk with your organization’s public affairs, regulatory affairs, and legal departments to see what regulations and standards affect your products. Find out what’s being reviewed, where you stack up, and where your competitors are. Then get the message to your customers. “This is probably not an everyday strategy, but when you hit a home run it’s a real home run,” says Shell.

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