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Legendary service without breaking the bank

Feb 23rd, 2007 | Customer Service | 0 Comments »

Extraordinary acts that go above and beyond the call of duty should be just that – extraordinary: If they happen every day to every customer, you become bankrupt, as your ‘cost to serve’ thresholds would be constantly breached.

This does not mean, however, that you should not encourage extraordinary acts that go above the cost to serve for an individual customer…Just that you should ration them sensibly.

Here’s my tip for breaking the paradox:

i) In a call center/centre environment, have a rota system for ‘extraordinariness’. One person can spend half an hour a day in ‘extraordinary’ mode, proactively offering imaginative service to clients with the specific aim of generating word-of-mouth stories. Or, maybe nominate one person as ‘hero for the day’, whose job is to jump in, emergency service-style, when there is a service failure, and achieve an extraordinary recovery.

ii) In a non-call center/centre environment, perhaps encourage your people to aim for and report back one heroic encounter with a customer per day, week or month (whichever is appropriate: be flexible – this is guidance on the principle, not the detail). That’s enough to generate the legends without breaking the bank.

This tip is from the March edition of my series One A Day For Customers, which will be on www.lulu.com in, er, March.

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Web communities have a lot to teach us

Feb 23rd, 2007 | Leadership | 0 Comments »

Guy Kawasaki moderated a panel of web community founders recently. They were fresh, informal, funny, and live in a world of peers and no rules. Community-based networks of common interest have the potential, it seems to me, to teach the corporate world some lessons in how to bring people together to pursue a common purpose, add value and generate income for participants.

As the dominant organisational form for big business is being effortlessly attacked by private venture funds, the scope for these boys (see link below: where are the girl founders by the way?) with their new community forms to teach corporates how to bring people together productively is massive:

Guy Kawasaki and a panel of web community founders

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Close to the customer: 25 years on, we seem to have forgotten…

Feb 22nd, 2007 | Customer Service | 0 Comments »

USEFUL CONCEPT

Close to the customer. In most organizations, distance from the customer denotes seniority. The more contact you have with customers, the lower your status must be (though this is not said openly). Tom Peters and Bob Waterman put customers and the frontline at the heart of the business agenda with the phrase ‘close to the customer’ in the book In Search of Excellence in 1982. A quarter of a century later, many leaders still don’t realize that they have to take this phrase literally and spend a significant portion of their time where their business actually is.

USEFUL CONCEPT

Close to the customer. In most organizations, distance from the customer denotes seniority. The more contact you have with customers, the lower your status must be (though this is not said openly). Tom Peters and Bob Waterman put customers and the frontline at the heart of the business agenda with the phrase ‘close to the customer’ in the book In Search of Excellence in 1982. A quarter of a century later, many leaders still don’t realize that they have to take this phrase literally and spend a significant portion of their time where their business actually is.

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A 60 Second Leader Tale: Covey on Turning Janitors into leader

Feb 22nd, 2007 | Leadership | 0 Comments »

Stephen Covey is talking at Leaders in London later this year, and so I dug out these notes I made last time I heard him speak. I like this story as it challenges what most people mean when they say the words ‘leader’ or ‘leadership’…

“A manager asked me how to get a team of janitors working in a way where they took responsibility instead of ducking it. I asked who managed the supplies, cleaning schedules, keeping within budget and so on.

He managed all of that. So, my advice was to cede it all step-by-step to the janitors. Let them set the schedules. Show them how to do the budgeting. The principle at work here is: ‘Lead people, manage things.’

He felt this was not possible with manual labour. But, much of what we have to do today is turning manual workers into knowledge workers.*

The janitors now do the planning and doing. The supervisor serves them. He has become a ‘servant leader’. Costs are down, incidentally…”

Source: My notes from a talk given by Stephen Covey. Before you can lead others you need to be able to take charge of and lead yourself. Frontline leadership, where there is no direct supervision of others in a hierarchy, often consists of this initiative-taking self-leadership, and leading peers by example.

*The phrase ‘knowledge worker’ is commonly taken to mean what white-collar workers have to evolve into. That’s wrong. Manual workers are becoming knowledge workers, too.

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Are you a bank?

Feb 21st, 2007 | Customer Service | 0 Comments »

“Ford is a bank
that uses cars
to sell finance packages
to its customers…”

Edward de Bono

“Ford is a bank”, de Bono famously said to the car giant’s Board to provoke them into thinking more creatively about their customer proposition, “that uses cars to sell finance packages to its customers.” This kind of lateral insight into how re-shape your customer proposition led to industrial giants such as GE setting up GE Capital Bank, to help customers finance their purchases. Finance arms now account for 50% or more of manufacturers’ and some retailers’ profitability.

There’s another de Bono insight over in the Leadership blog that shows the value of re-thinking what your customer proposition is.

So, are you a bank? Or something else? I’ll post something I heard Philip Kotler the marketing guru say a while back that may help you with this kind of radical reframing. You remember Kotler’s famous ‘Four Ps of Marketing’? Well, whether you do or not, they’re old hat because they are supplier-centred rather than customer-centred.

Kotler realised this and translated them into ‘The Four Cs’ of marketing – each taking a customer perspective instead of a supplier perspective. Looking outside-in at your organization like that – just changing the language to change how you see your organization – is immensely powerful. I’ll dig out the Kotler stuff and post it in a day or two so you can see what I mean.

In the meantime, I’ll leave you to annoy your colleagues by asking them “Are we really a bank?” as a provocation. Er, don’t do it if you ARE a bank, though. Actually, on second thoughts, do…

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How can you die before you die?

Feb 21st, 2007 | Leadership | 0 Comments »

Moving from a product to a customer-centred culture demands innovative, flexible thinking. So, where do you start? Edward de Bono tells the story of Ron Barbaro of Prudential Insurance, Canada, to illustrate how to do it.

Barbaro was at the hospital bedside of a terminally ill friend, whose illness was long and drawn out. Barbaro was frustrated that his industry had no product that was of relevance to his friend’s situation; that could ease his life before death, rather than pay up after, as existing life assurance did then.

Barbaro left the hospital thinking the ridiculous: “How can you die before you die?” If he had lacked the mental flexibility to come up with such an apparently absurd question, he would not have come up with the answer: Living Needs Benefit, a new product that pays out 75% of a life policy while the policy holder is still alive.

At a stroke, Barbaro had invented a new product that made life assurance much more attractive for single people, a category of customer (often affluent) who previously had little use for it. Now, almost every life assurance company around the world has a similar category of product.

De Bono defines this kind of thinking – beginning with a thought far removed from any existing product and then forcing the brain to work out a pathway from there to a workable product – as a ‘provocation’, rather like the grit in an oyster that encourages a pearl to form. Yes, I know this is old stuff, but it’s still not practised enough.

“The brain is astute at building new pathways to connect different areas, and this kind of exercise helps develop that ability,” he says. It worked for Barbaro. He became President of Prudential Canada.

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Customer satisfaction isn’t enough: ask different questions

Feb 19th, 2007 | Customer Service | 0 Comments »

“Too often we focus all our attention on customer satisfaction surveys that say ‘You just bought this: are you happy with it?’ Of course they are happy with it! If it’s a car, they’ve just spent £10,000 on it, so what do you expect?

‘The really important questions are ‘What about the people who didn’t buy?’ or ‘What about the people who were customers and who left?’ What do you do to find out about that? Do you contrast how customers behave to find out what is really going on?’

– Clive Humby, the mathematician co-founder of Dunnhumby, the brains behind Tesco’s Clubcard, which gives the retailer far more insight into its customer base than any other retailer I know. I heard Clive say a while back “Tesco is no longer a supplier. It is now a buyer on behalf of its customers.”

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Capitalism 2.0? CoCo Companies: Co-ownership and Co-creation

Feb 19th, 2007 | Leadership | 0 Comments »

“What makes wage slaves?” asked Groucho Marx once. “Wages.”

The Employee Ownership Association in the UK today publishes a paper by Richard Reeves (whose Intelligence Agency site seems permanently closed for renovation, but his contact details are up there) on CoCo Companies – companies that practise co-ownership and co-creation.

If you were to create an ideal business or organizational form from a blank sheet today, to fit the expectations people have of their lives and work, and to bring people together in a joint enterprise, it would look far more like a CoCo company than it would a limited company.

“CoCo companies may offer an organisational model whose time has come”, says Richard.

Mutual or co-operative enterprises, with a new injection of co-creation, may finally fulfil the promise John Stuart Mill held for them a century and a half ago.

Richard’s biography of Mill comes out this year and he quotes the philosopher-economist as saying that co-ownership holds out the prospect of:

“…the healing of the standing feud between labour and capital; the transformation of human life, from a conflict of classes struggling for opposite interests, to a friendly rivalry in their pursuit of a common good to all; the elevation of the dignity of labour; a new sense of security and independence in the labouring classes; and the conversion of each human being’s daily occupation into a school of the social sympathies and practical intelligence.”

Gets my vote.

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Are you an Asshole Leader?

Feb 19th, 2007 | Leadership | 0 Comments »

Try the 24-question Asshole-Rating Self-Assessment (ARSE – at last the Yanks spell it correctly) that Guy Kawasaki and his friends at Electric Pulp have put together. It’s from the excellent Bob Sutton’s book The No Asshole Rule. Unfortunately, this rule, and this self-assessment, are highly relevant to a lot of leaders, as you will find out if you go through the 24 questions. Of course they don’t apply to you…But they will remind you of plenty of bad bosses (hopefully from your past rather than your present).

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Show customers you love them: Overcoming the happiness deficit

Feb 14th, 2007 | Customer Service | 0 Comments »

Show customers you love them

If you are reading this on February 14th, it’s Valentine’s Day, so here’s a Valentine-ish thing to mark the day: show customers some love.

The research organization The Henley Centre has identified something it calls a ‘happiness deficit’ among modern consumers. It says that the more affluent we have become, the more quietly frustrated we all are that increased access to consumer goods doesn’t bring an automatic increase in happiness.

“Understanding why consumers are unhappy, and helping them to bridge the gap, could be one of the biggest opportunities of the 21st century,” says The Henley Centre. Many analysts say the problem is customers (us) are alienated by service providers who treat us primarily as a source of money and rarely with real human warmth. This has prompted Yahoo’s Tim Sanders to argue that “Love is the Killer App” in his book of the same name.

Other customer commentators and analysts (including me) think there is a point in this: occasionally showing customers something economists call “the abundance mentality” instead of “the scarcity mentality” is a powerful thing to do.

Quick example of “the abundance mentality” would be if you work in a hotel coffee shop and a customer is looking distracted and maybe a little depressed, and is fumbling to find the right money to pay for their coffee. Instead of taking payment, you say with a smile “Don’t worry. You look hassled. Have that on us.” Staff at Pret a Manger (the sandwich stores) do this several times a week, particularly if a customer has had to wait too long in the server’s view. Pret founder Sinclair Beecham once explained it to me this way: “For a few free lunches a week, the goodwill it creates makes it worth it. You can make someone’s day with just a small gesture.”

Quick example of “the scarcity mentality”: Those coat hangers with no hooks at the top that you find in some hotels, expressly designed so that you won’t take them. There is an assumption of bad faith about them that comes across as mean-minded.

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