Regardless of how you feel about MLM or network marketing, Amway's success cannot be denied. Behind the over 3 million distributors selling more than $7 billion in product in more than 70 countries lies an effective management system that helps and gets the most out of an organization of disparate people none of which operate from a company office. Every entrepreneur can benefit from understanding how Amway recruits, trains, and motivates its independent distributors.
Even with an annual turnover estimated to be in excess of 40%, Amway “manages” to keep growing. And now the current trend of outsourcing jobs and corporate downsizing plays right into their hands.
Any entrepreneur or businessperson can learn from Amway and improve their company’s performance by adapting the same techniques.
Studying Michael G. Pratt’s academic article, “The good, the bad, and the ambivalent: Managing identification among Amway distributors” in the September 2000 issue of Administrative Science Quarterly provides some interesting information.
Amway has focused on everyone’s need for identity; his or her own, how they relate to their associates, and with the business or company with which they are linked.
Having come to understand the importance of this issue, Amway figured out how to capitalize on the negative feelings people have with respect to their identity and through dream building and positive actions by the up-line distributors, motivate them to become successful Amway distributors.
Recruits to the Amway program are carefully screened to determine where they are on the dissatisfaction scale and why. Once determined, negative statements designed to increase the dissatisfaction (“Sensebreaking”) by attacking the sense of why the individual should remain in that bad situation, are repeatedly presented to the individual.
At the point when the person is willing to abandon the unpleasant situation (s) Amway then gives the person new meaning for his or her life, (“Sensegiving”) until finally the person takes action (“Sensemaking”) as he or she sees the sense of joining Amway.
Once on board the Amway train, the down-line people are constantly assessed by successful up-line people who are unusually adept at determining where they are in these three emotional states. Should anyone start to become ambivalent, “help” is quickly provided to whichever condition needs attention or reinforcement.
How does this help you in your business?
First, understand that many people are, for a variety of reasons, undergoing identity crises - maybe you were too and that’s what motivated you to go into business for yourself. Employment concerns, family and financial issues, and worries about retirement all contribute. Second, consider that any person in such a frame of mind will not be very productive. Also realize that they will ultimately resolve their problem. And know, that as their employer, you may be the victim of their attempt to take action - or as the one who helps them, you may be the beneficiary.
Third recognize that you, as their employer, are in a position to help them slay the identity beast (or make it worse) by how you deal with them. Last, you can and should always be looking for ways to help them improve their identity, their self-esteem, their business and perhaps their personal relationships.
How do you help? Practice what Amway does. Sharpen your people skills so you can tune in to how and when people are changing. We all do, some more frequently than others. But you have to be able to see who around you is changing and how - with respect to Sensebreaking and Sensemaking, so you can provide more Sensegiving. If the meaning of someone’s life has become unclear, if he or she can’t find a way to zero in on what’s important, then that person certainly can’t take action. They can’t get back to helping themselves achieve their dreams or helping you achieve your objectives. But what’s worse they are susceptible to a smooth talking Amway recruiter or your competitor who is more tuned in to people.
With more telecommuting and reliance on the Internet, especially in the technical fields like engineering and science, more people are spending less time in offices or environments where meaningful appreciation and sincere “atta-boys” are expressed. In these times and situations it’s easy for people to develop identity issues. If you can’t see your organization and talk to them, frequently and in-depth, you may wind up losing good people to better employers.
If Amway can get millions in sales per distributor you ought to be able to get - what? Half as much? Would you settle for twenty-five? Just remember the owners of Amway up in Canada are smiling at how little respect most of us give the MLM ers.
By Art Consoli, http://www.artconsoli.com - author of “How to Evaluate and Profit from a Business Opportunity - The Entrepreneur’s Guide”
Art Consoli held eight corporate positions with Johnson & Johnson before starting his first business. He went on to build over twenty businesses from patents or ideas or from businesses others couldn't make successful. These ranged from starting a veterinarian drug company to taking over a steel fabricating company to developing the first manufactured home subdivision to qualify for every private and government assisted mortgage program in Arizona. He also did ten workouts for lenders and owners; the last was a $30 million, 300 employee, precision parts manufacturing plant that made parts for the auto industry. Consoli's unique background and skills allow him to speak and write about how someone with limited experience can do a self-evaluation which will let him decide which business opportunity is best, how to evaluate opportunities and gain control over the one which offers the greatest potential and then manage that business to success. Readers of his book call and write to tell him how much his book has helped their lives and improved their business.