Category Archives: Uncategorized

Empowering Employees to do the right thing for customers

chateau_elan

When we measure the customer-centric culture of organizations around the world, one of the recurring themes is a low score on “empowerment”.

Lack of empowerment – real or perceived – has a huge impact on the ability of frontline staff to solve a customer’s problem. It also has a big impact on costs and is seen in many ways – duplication of work, mixed messages to customers, bottlenecks and slowdowns in customer service, and new product introductions – just to name a few.

For frontline staff to be empowered to solve customer problems or rapidly respond to customers’ requests a business needs a culture that encourages staff to be accountable for ensuring a solution for the customer is delivered. They need to have the confidence to make a decision that is right for the customer without fear of retribution from their managers if it seems to cost the business money. If they can’t fix it themselves they need to be confident that those who are alerted to the issue will fix it for the customer quickly.

A great example of this is seen in the hospitality industry. Chateau Elan, a boutique resort hotel with a property each in the United States and Australia has created an empowered culture in which a customer can ask any member of staff to do something for them – book a restaurant or a cab or get extra towels in their room. The immediate response by the hotel employee is “consider it done!”

This is an emphatic promise to the customer that it will be done. Not only does it give confidence to the customer but it empowers staff to collaborate and ensure the customer is satisfied.

How do you go about creating a customer culture of empowerment in your business?

What sport can teach us about customer centricity

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Sporting clubs refer to their customers as fans. This is an appropriate term because “fan” is shortened from “fanatic”. Successful sporting teams have fanatical supporters who are typically lifelong supporters of their sporting club and team.

Take the Seattle Seahawks, a professional American football franchise playing in the National Football League (NFL). Seahawks fans have been referred to collectively as the “12th Man” representing such a supportive force for their team that it is like having an extra man on the field. The Seahawks’ fans have twice set the Guinness World Record for the loudest crowd noise at a sporting event, first on September 15, 2013, registering 136.6 decibels during a home game and again on December 2, 2013, during a night home game with a then record-setting 137.6 decibels. This has occurred, in part, by customer-centric design because their new home stadium was purpose built so that fans would be closer to the field of play than in other stadiums and could urge their team on with such noisy enthusiasm that the opposing team could not hear the “plays” being called. This was a competitive advantage that resulted in almost all home games being won by the Seahawks in the last couple of years.

In 2014, the Seahawks won their first Super Bowl Championship, defeating Denver 43-8. More than 600,000 people turned up for the post match celebration in Seattle – about the number of its total population. The following season, Seattle advanced to Super Bowl XLIX, their second consecutive Super Bowl, but they were narrowly beaten by the New England Patriots by a score of 28-24. This kind of fan support is planned and nurtured by the Seahawks senior leadership, management, coaches and players with a special stand in the stadium named as the 12th Man, special events for fans and online connection that is devoted to engaging fans with the team and the club. This type of support occurs because the fans are at the center of thinking and decision-making.

Imagine if your customers were like the Seahawks fans – vocal, loyal advocates that are fans for life. How would that affect your bottom line? How would it affect your staff engagement? The answer is obvious – it would affect both very positively and create sustainable profitable growth.

But to do it you must have a customer-centric culture that focuses on creating superior value for your customers and puts long term customer relationships ahead of short term profit. Like in successful sporting franchises, everyone in your business has a vital role to play in creating and delivering value for your customers. You can find out more on how to do it in the The Customer Culture Imperativejudged the best marketing book 2015.

Why do companies fail to be customer centric?

Epic Customer Service Failure

I recently had the opportunity to deliver a keynote address at a large conference in San Diego. At the start of my talk one of the questions I like to ask the audience is:

“How many of you recently had a bad customer experience?”

More than 100 hands went up (probably 80% of those in the room). While this may sound dramatic, sadly it’s not unusual. Poor customer experiences are going to happen with any company you do business with at some stage. However great companies realize they will not get it right every time and make proactive preparations to deal with things that may go wrong.

Unfortunately the company in this next example fails multiple times on this front. It clearly does not have a customer centric culture. (Before you read on – full disclosure I have been a customer of this firm and this is based on my own experiences).

I am not going to name and shame the company but rather use it as an example of what not to do in business. It is a large fully integrated, international property and infrastructure group headquartered in Australia.

We are not talking about large corporate or commercial projects, but residential housing. The firm has has a number of residential housing projects around Sydney, Australia and no matter who you talk to, the experience has been bad. Poor project management and supervision of contractors and sub-contractors has resulted in countless defects. Now it’s not all bad – they do fulfill their legal obligations to fix defects thoroughly – so long as you are prepared to wait for them to do it at their convenience.

The thinking is: “we will get a painter, plumber or electrician to your house to fix the defect when there is someone in the area – or if we have several jobs to do in your area that we can group together”. Forget the fact that the hot water system has gone – you can wait 3 days before it is convenient for them to come. Forget the fact that the job of fixing a leak is half done – it can be weeks before it is completed. That is just the tip of the iceberg. Lack of response to consumer requests, poor communication and lack of a “customer perspective” all contribute to the heartache.

Yet this firm espouses some admirable core values – respect-collaboration-integrity-excellence-innovation.  However it’s vision: “to create the best places, supports our strategic direction to be the leading international property and infrastructure group” is predominantly internally focused.

Nowhere do we see the word “Customer”.

This firm reflects a retail building industry that is self-centered, arrogant and self-serving. Clearly not all building businesses and contractors operate in the same manner. But it shows what happens with large businesses that are focused on profit at the expense of the consumer. It results in dissatisfaction, anger and frustration on the part of the customer.

This firm and others like it have a huge change to make if they are to have any hope of delivering a consistently good customer experience. The start must come with senior leadership who need to find out what is going on and understand what many consumers experience. It’s called “eating your own dog-food”. If some of the senior leadership had the same experience with their own homes as many consumers they would do something about it. Then a customer-centric culture needs to be embedded throughout the organization – not just lip service, but real change of mindset and actions that create a much more positive customer experience.

There is a clear roadmap for this in the book – The Customer Culture Imperative – if leaders in these large businesses care to look. But then again while the business is profitable “who cares”?

This type of short-term thinking will only make things harder for businesses like these in the future, when new players exploit their lack of customer understanding and care.

 

Why real-time customer feedback is the future for customer centric companies

Feedback

Companies have been measuring customer satisfaction levels for many years and yet many of these same companies have not seen significant improvements or changes. One of the reasons is customer satisfaction research has been a static activity. Satisfaction levels are measured once a year or less frequency. The data is discussed and reviewed but is not integrated or used to drive business decisions. The result is a lack of action. Even worse customers make complaints which companies then try to address weeks after any useful resolution is available.

In fact this cycle of asking customers for feedback and doing little or nothing with it is one reason why most customers don’t respond to surveys. Why should customers spend the time providing feedback when nothing meaningful will be done?

One of the challenges facing companies trying to implement a more real-time approach in the past has been limited resources to apply to the challenge. Real time has required surveys been run more frequently and systems to be available to provide that feedback to the right people at the right time.

Thankfully with the technology available today, a number of companies are providing customer centric organizations with new tools to gather insights and feedback on the go.

A great example comes from the healthcare industry, more specifically hospitals. Patient Experience is something that Hospitals can no longer ignore as a large percentage of their at-risk income under the affordable care act comes from their patient satisfaction levels.

Eric LoMonaco, a great patient centered leader, from the Community Hospital of the Monterey Peninsula (CHOMP) in Monterey recently implemented a real time feedback program using QR codes placed strategically around the hospital.

qr-code used for feedback

The challenge they faced was satisfaction was measured by an external body that would provide reporting after the fact. The result was patients left the hospital with problems that were never addressed. Eric saw the opportunity to implement a system that would allow CHOMP to gain real time feedback that could be directed to leaders in the hospital and responded to in real time.

The impact of this system on patient satisfaction levels has been dramatic and immediate. By scanning a QR code or simply sending a text message directly to a leader in the Hospital, Patients are able to provide real-time feedback that leaders can address immediately as issues arise rather than after the fact.

Eric shares the results CHOMP has been achieved so far in a great article he wrote here and a webcast here.

With this type of technology available, the excuses for real-time customer satisfaction improvements are running out.

It is the combination of a customer centric mindset, coupled with technology and processes that will determine the winners in today’s business environment. To learn more about creating the right culture in your business, check out our book, The Customer Culture Imperative.

How does your business compare with America’s 3 worst industries?

Frustrated Customer

The state of customer service in 3 US industries is driving customers to distraction.

3 Industries That Desperately Need Customer Service Makeovers

In 2014 Comcast, the cable company, “won” the annual Worst Company in America competition as voted by Consumerist readers. The state of customer service has been so bad for so long that consumers are skeptical to new announcements about improving customer service. Even the recent announcement that a long serving executive, Charlie Herrin, has been appointed as Comcast’s new senior vice president of customer experience has been met with some derision.

The related industry of pay TV-Internet providers including Time Warner, DirecTV and Verizon is also known for poor customer service and consumer complaints that the industry players lack real competition.

Studies also show how frustrated and dissatisfied consumers are with wireless providers including AT&T, Verizon, T-Mobile and Sprint. A vote at Ranker.com placed AT&T at the top of the list of “Companies with the Worst Customer Service.”

These 3 industries are the tip of the iceberg. There are many more that deliver a poor customer experience and do not seem to be able to overcome the roadblocks.

Is your company like one of these? Are you finding roadblocks to improving customer experience across all the organizational touch-points you have with your customers? The chances are that you do not have buy-in from all parts of your business, other priorities are taking precedence and your customer experience is not improving at the rate or level that you want.

What’s your response? Are you adopting an ad hoc approach to plugging the weaknesses which is eating up all your time and showing little progress? Are you spending time at endless meetings trying to persuade cynics of the importance in taking a “customer” approach or are you really looking for a solution that works?

There is only one way to get a solution that counts and can be sustained. You must first identify why customer experience is poor. To do this you must get insights about your customers’ needs and behaviors and what you must do to deliver value that satisfies them. There is only one way to act on this – to identify weaknesses in your customer-focus culture and take action to strengthen it. If you don’t act on this you won’t fix customer experience problems. We have found through extensive research that the right action to strengthen customer-focus culture will provide your business with valuable insights that will improve customer experience and increase customer retention and revenue.

How? You must start by measuring your customer-focus culture. If you don’t measure it, you can’t manage it. This will show the source of your customer experience problems and create a focus for all in your business and relevant functions to act on a permanent solution. It will galvanize buy-in from those areas that are resistant. There are usually clear, simple and quick actions you can take. These actions will strengthen the customer experience mindset and habits around creating more value for customers with enhanced customer experience.

If Comcast is finally serious, its new senior vice president of customer experience will need to take the actions proposed above. If he wants a proven roadmap and methodology to introduce real customer-centric change into Comcast he can find it in The Customer Culture Imperative: A Leader’s Guide to Driving Superior Performance.

Is your business model under threat and your survival at stake?

Business Model Threat

In any large successful business today parts of the business are performing well while other parts are ailing. Multinationals like Ford Motor Company and Starbucks are performing well in some countries, but not in others. Samsung and Ikea have high market acceptance of some products, but not others. But, what’s important is to determine if your core business model is under threat. If it is, your very survival is at stake.

Consider what is happening to the traditional postal service corporations like the US Postal Service (USPS), Royal Mail (UK) and Australia Post. Virtually all national postal services originated from government owned and legislated monopolies when letters were the primary source of written communication. These organizations created thousands of bricks and mortar post offices and shops, a large transport infrastructure to deliver letters using thousands of postal staff. The digital revolution has changed all that – letter volumes are declining rapidly, with consequent ongoing and growing losses for incumbent mail services. The business models of traditional postal corporations are under attack from all sides.

Take Australia Post. Like many postal corporations it has developed a growing profitable parcel delivery service fuelled by online consumer purchasing. It is providing new services like its digital mailbox for business and consumers. But profits from these new lines of business are being eroded by losses in the traditional letter delivery business and from competition. Both Singapore Post and Japan Post have purchased courier companies to compete in the Australian parcels delivery market. Also Uber Rush is allowing people to order pickup and delivery of packages using the Uber app. Last year Volvo trialed a service called Roam Delivery that allows retailers to drop off merchandise inside your parked car. All of this adds up to intense competition for Australia Post. Much the same is happening to US Post and Royal Mail as well as other incumbent mail and postal services around the world.

How can organizations like Australia Post survive? They must develop and strengthen a customer-centric culture as the foundation of their organization and as a basis for long-term competitive advantage. This means that they must have strategic alignment with their markets and customers where an understanding of current and future customer needs and current and potential future competitors is factored into their strategies and supported by everyone in the business. This knowledge and mindset must become embedded in all of their businesses and throughout all functions in their organization to enable them to become more agile, competitive and innovative to create superior value for their customers. That in turn will help to drive ongoing growth and profitability.

The postal organizations around the world seem to be at different stages on the journey to customer centricity. New Zealand Post is probably one of the most competitive being one of the earliest to have its mail service deregulated in 1998. It is now two years into a 5-year transformation plan and is showing improvements in overall profitability. USPS lost US$5.5 billion in 2014 despite its growth in package services and has a lot of ground to make up. Australia post is profitable, but profits are declining from the impact of mail service losses and there is now a strong focus on developing a customer culture.

Is your business model under threat? You can measure where you are in terms of customer centricity and what stage of the journey you have reached by exploring the roadmap provided in the award winning book: The Customer Culture Imperative: A Leader’s Guide to Driving Superior performance.

Why should a monopoly be customer-centric?

Monopoly

If you operate a monopoly you can dictate what customers get, when they get it and what price they will pay. Legislated monopolies like water and power utilities, letter mail services and cable companies with geographic monopolies have held customers to ransom and traditionally have just paid lip service to customer service.

Why should that be any different today? Well there are some good reasons why these monopolies should start to think deeply about their customers’ needs and strive to provide more value to them – that is, to start becoming customer-centric.

First, disruptive technologies and indirect competitors are changing the way consumers behave and what they value. Both US Mail and Australia Post are experiencing substantial and growing losses in their mail services as people communicate digitally. The businesses of cable companies are feeling the inroads of satellite providers and digital entertainment services streamed directly to consumers’ smart phones and mobile devices. Water authorities are facing existing and new competitors that are adding value to the basic water supply. The bottled water market is huge around the world. New technologies to tap sea water for use in irrigation are in their infancy but will impact the traditional water authorities over time. Solar technology, power generation technologies for businesses and subsequently homes are having an impact as alternative sources of energy.

Second, monopolies are under pressure to become more efficient by regulators and government stakeholders to reduce duplication and waste and make better asset resource decisions dictated by the future needs of consumers and continuous pressures on the public purse.

Finally, unhappy customers resisting price rises and poor service are becoming vocal and this translates into lost votes for politicians.

The Water Services Association of Australia (WSAA) is the industry body that supports the Australian Urban Water Industry. Its members and associate members are monopolies that provide water and sewerage services to approximately 20 million Australians and many of Australia’s largest enterprises. Its members have defined the vision they want to achieve by 2030 as:

Customer driven, enriching life. 

Many of the individual water utilities are embarking on a customer-centric initiative to develop a customer culture within their organizations. There are strong customer-centric behaviors in parts of their organizations, but senior leaders realize that many of the traditional functions in their utilities are internally focused. The best starting point will be to benchmark all the functions in the utility to measure relative customer centricity strengths and weaknesses using a tool such as the Market Responsiveness Index. This will highlight “bright spots” in the organization and help create focus for specific initiatives to develop customer centricity.

If you are in a monopoly position, are you considering how to develop a more customer responsive organization – not just through improved customer service, but as a customer culture? You can find a roadmap to help chart your course in our award winning book: The Customer Culture Imperative