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Here are examples of the Academy of Service Excellence newsletters ASE Newletter November 2003 I'm
just back from the Orlando conference on Customer Management (I really don't
like that title - you can't manage customers any more - they might try to manage
you - but that's about as far as it goes nowadays). Anyway I thought I write
down a few thoughts based on what I heard and learnt at the event. Chris Daffy Newsletter – 2006.1
Interesting thoughts I thought I’d begin with some thoughts on things that have interested me recently. I hope they’re of equal interest to you. Customer Experience – It seems that you can’t pick up a management, business strategy or customer service book nowadays without some reference to Customer Experience. But most of them seem to only confuse something which should be really simple. So I thought I’d use this opportunity to explain how simple I think the subject of customer experience is to understand and should be to manage. The core issue is ‘what is or are the differences between products and services and customer experiences?’ and/or ‘what turns a standard product or service into a customer experience?’ I think the answer is simply explained by the question ‘how memorable are the products or services you provide?’ The more memorable they are the more of an experience they will be. Gilmore and Pine, in there original book on the subject, The Experience Economy, first spotted this link between experiences and memory, and I think it’s the key one. And if you look at the things we remember they tend to fall into three distinct categories. They are the things which were much better than we expected them to be (WOWs), things that were much worse than we expected them to be (OUCHes) and things that were going or had gone wrong that were put right in a way that was much better than we expected (RECOVERY). And that’s it. Everything else we do, although important and possibly up to 99% of all our activities are expected, do not trigger memory, and are therefore not experiences. Take for example something that has nothing to do with service delivery, but has been around for many years and most people in the World will have some experience of; the American NASA space programme. There have been billions (maybe trillions!) of dollars invested in it, but if you ask most people what they can remember, they will usually only recall three or four things. They are landing on the moon and/or the first shuttle landing (the WOWs) the Challenger disaster (the OUCH) and Apollo 13 (the RECOVERY). Can you remember anything else? I guess not. And it’s the same with your products or services. It’s just a few things that will class as experiences and therefore be remembered by customers and influence their behaviour. This doesn’t mean that the other things aren’t important. They obviously are because they are the basic things you promise to do for customers which are the core of your business offering. But it’s vital to remember that almost all of them won’t be remembered. So you need also to focus attention on the things that will. And they are - WOWs – the little positive things that customers were not expecting that make them feel valued. OUCHes – the things that go wrong that irritate customers and need to be eliminated. RECOVERY - ways of dealing with OUCHes, that turn them into WOWs. If you’re interested to learn more about WOWs, and RECOVERY and how to eliminate OUCHes there are lots of ideas and examples on my web site. ------- xxxxx ------- PC World discover that service sells -In a recent article in the Daily Telegraph it was reported that PC World has abolished sales commissions and discovered that it can make more money by rewarding staff to serve customers, rather than to clinch a quick sale. Well what a surprise! Who’d have thought that? I guess, like me, all of you have thought that for many years. And I hope you have built your business models around it. A focus on long term relationships with customers outsells short term quick sales virtually every time. And it builds a bigger and stronger bottom line because repeat customers are generally less price sensitive than fickle one off purchasers. And it improves staff morale and retention because people prefer to serve regulars they know rather than strangers they don’t. And it reduces marketing costs because repeat sales cost less than new sales and customer referrals cost nothing. And it makes leadership easier because happy staff, serving happy customers, create less problems so management attention can be focussed on positive issues. And finally it makes the business more valuable because investors prefer businesses with steady, reliable staff and customer bases. So PC World have discovered what we all knew years ago. Let’s hope they have the courage and determination to stick with it. Maybe they will roll this ‘revolutionary’ new idea out across their sister brands – Dixons, Currys and The Link. Then perhaps other retailers might notice and we will see a general improvement in service in all retail sectors. And then maybe we’ll also see some strange new pink objects in the sky - going ‘oink’ instead of ‘tweet’. ------- xxxxx ------- Do you celebrate enough? – There’s one thing that seems to be common across all successful organisations. That is that they sure know how to celebrate success. I’ve just finished a series of three events for Pizza Express and WOW do they know how to party when things are going well. I also had the chance to do some presentations with Julie Robinson, who was the Customer Service Director at Virgin Atlantic for 20 years, and she has a slide that just says Party, Party, Party! Richard Branson is mad about parties to celebrate success and build a positive culture. And if you’ve read any of the Jack Welch (Ex CEO of GE) material, like his excellent book Winning or his column in the Daily Telegraph, you’ll know how important he considers regular celebrations of success are. Too many organisations appear to have a culture that pounces on things going wrong, but ignores things going well. Yet all the research shows, and all great leaders understand, that focussing on the right behaviours and results always creates more success than focussing on the wrong ones. So think about your organisation. Are you too quick or eager to spot the bad things and too slow or reluctant to spot the good ones. Are you always prepared to make people feel bad about getting things wrong but apparently unwilling to make them feel good about getting things right? If so you should change things. Success and Celebrations are connected. They create a virtuous cycle which breeds an environment of winners and winning. So my recommendation is to make regular celebrations a habitual part of your business culture. ------- xxxxx ------- Leadership Forum – For the past 2 years I’ve been organising and facilitating The Leadership Forum. It was originally formed from a small group of founding members who were leaders in a number of organisations that I work closely with. We now meet once every 3 months to share knowledge and experience, listen to and debate with guest speakers and discuss various topics selected by the members. In between these meetings we arrange visits to each others organisations, and to events featuring speakers worth hearing (Such as the Customer Management Conference in May). There are currently 2 groups running, one in the North West and one in the London area. If you could be interested and wish to learn more about this please send me an e-mail for further details. ------- xxxxx ------- Best of British Study Tours – I haven’t done any study tours for a few years. Again, being too busy has been my excuse. Yet they were always popular so I’m considering doing some again. I don’t think there is any need to go abroad to see great service so my plan is to focus on British businesses that provide World Class service and are recognised for doing so. I’m currently discussing the possibility of visits with a few organisations that I know fit this profile and hope to have some details available soon. If you’d be interested to know more about this please let me know. ------- xxxxx -------
Well that’s enough for now. I hope this newsletter provides the type and quality of information you want from it. Do please let me know what you think. I’d value any observations or suggestions for improvements. Chris Daffy Newsletter – 2006.2 European Conference on Customer Management I’m just back from 3 days at the European Conference on Customer Management so I thought that while it was all still fresh in my mind I’d write about what I saw and heard of interest to help those of you that were unable to attend get an insight into the thoughts of the key speakers. On a general note, it was interesting to see that although the title of the event is the European Conference it is now attended by a World audience. I met people from America, Canada, the Middle East, the Far East, North and South Africa, and Australia. So this must now be one of the World’s major conferences on the subject. There was even a delegation of 100 people from Russia who all worked for one of their new commercial airlines called S7. The first thing I should say is that I’ve been at every one of these events since they began in the mid 1990’s and in my view this was the best ever. I will admit that might be because during the event I achieved my long held ambition of spending an hour chatting to Jack Welch, but as well as that I think that the overall mix of speakers and topics was the best yet. I attended all three days and I’m sure you will not want to know about every presentation so I’ll just outline what to me were the highlights of each day. Day 1 – The Customer Advocacy, Loyalty and Retention Summit This was an extra to the main conference to focus on the subjects referred to in the title. The key speaker on the day was Philip Kotler and I was hoping to learn lots of new things from him. I had a chance to talk to him in the Green Room and he’s a charming fellow but I was a bit disappointed by his presentation. It was all too academic for me and I didn’t learn much that I didn’t know already (I guess like me many of you had to study his books to learn about marketing), except that the World’s biggest manufacturer of shoes and clothing (as measured by the number of items made and sold) is Mattel – for the Barbie dolls. I also found it interesting to learn that a train company in the USA are offering management training courses in special compartments on commuter trains so people can get an MBA while they travel to and from work. I think that’s a great use of otherwise wasted time which should be adopted in the UK. The other presentations that day were a bit too technical ir industry specific for me apart from the one from Alan Lias, who is head of Loyalty for Virgin Atlantic. He told us about the ways Virgin are constantly striving to keep developing their product to keep it fresh, innovative and ahead of the competition. An interesting point he made is that if you look at the DNA of monkeys and man there is only about 2% to 4% that’s different; but what a difference that 2% to 4% makes! He believes it’s the same with many businesses competing in the same markets for the same customers. There may not be much that’s different between them but even if it’s just 4%, if it’s the right 4% it can make a massive difference to customers. I also presented on that day and explained the link I’m convinced exists between Experiences and Loyalty. How the wrong experiences influence customers to be less loyal and the right ones more loyal. I focussed on the fact that most of what all businesses do, although essential, is invisible to customers and therefore has little or no influence on their loyalty. It’s the things at the edges of this, what I call the Influential Experiences, the Ouches, Wows and Recovery (more about this on my web site) that have the greatest impact. So although we must make sure that all the ‘business as usual’ things are exactly as we and customers want or expect them to be, they do little to affect loyalty. We must therefore also give attention to those small but powerful Influential Experiences. Day 2 – Main Conference Day 1 John Kotter – Harvard Business School John’s main theme was leadership. He treated his presentation a bit like a business school lecture, filling it with 10 year old film clips of visiting business leaders to HBS, audience debating exercises, and bland transparencies shown on an overhead projector. However his main theme was compelling. It was that “Almost all of the successful, big and sustained corporate change programmes had improving things for customers as their core driver”. And conversely “Almost all of the unsuccessful, big and short lived ones had improving things for investors as a core driver”. I guess you could say that employees know instinctively that making unknown investors even richer at the expense of customers (and perhaps themselves) is not the right thing to do. But making things better for customers (and hopefully themselves at the same time) is the right thing to do - and if that results in investors getting richer, then that’s OK. He also talked about what he considers to be the key 8 stages of a successful corporate change programmes. They are – 1. Establish a Sense of Urgency – You MUST be in a hurry - if you don’t do it quickly it will take for ever! 2. Create a Guiding Coalition – Bring together a high performance core team with the power and drive to lead the way and make it happen. 3. Develop a Vision and Strategy – Create a clear vision of what things will look and feel like when the change is over and what must be done to achieve it. 4. Communicate the Change Vision – Have a programme of communication that ensures everyone understands why it is necessary, what it will look and feel like to them when it’s over, what’s in it for them, and what part they must each play in making it happen. (Also the implications of failure, resistance or simply being a passenger.) 5. Empower Broad Based Action – Get everyone involved with a worthwhile part to play in making the change. 6. Generate Short Term Wins – Do the quick and easy things first and then loudly and widely broadcast the successes. 7. Consolidate Gains and Produce More – After spreading the news of the quick wins, make them stick, get others doing the same, keep looking for more and get cracking with the bigger challenges. 8. Anchor the New Approaches in the Culture – Turn your new ways of working into your normal ways of working. (More about this can be found in his book Leading Change) It’s a great model that I have used successfully with a number of businesses. He also made an interesting final comment, that many organisation get off to a good start but fail to make much difference in the long term because step one is not in place. They are not in a big enough hurry and/or not prepared to accept the inevitable short term mess that being in a hurry creates. So step one is critical to long term success. Karan Bilimoria – CEO and Founder - Cobra Beer I’m a fan of Indian food and I think Cobra Beer is the best drink to accompany it, so it was great to hear from the guy that created it. He’s a very smart and charming fellow but the bit that stuck in my mind about his presentation was the company Vision. It is – “To aspire and achieve against all odds, with integrity”. It’s based on a family motto, created by his grandfather, which was ‘Aspire and Achieve’. It reminded me of a quotation from Gary Hamel (of Harvard Business School) that’s haunted me ever since I heard it. “All organisations are limited by their aspirations” (I think this is true of individuals too.) One of the greatest limitations we have, as individuals and organisations, is a mental one. What we tell ourselves we want to achieve or are able to do - our aspirations - set the limit for our achievements. Too many people and organisations set themselves easy to achieve goals, with little or no real stretch, for fear of failure. But the higher our aspirations, the higher are our achievements. I therefore believe its far better to aim for 20 and only hit 18, than it is to aim for 10 and hit 11. It looks like Karan Bilimoria (and Jack Welch – see later) does too. Chris Pilling – CEO – First Direct Bank Chris had only been in the job 10 days when he got up to tell us about what makes First Direct tick. I was therefore very impressed by the amount he had learned and understood in such a short time. I had some involvement back in the early 1990’s in the Midland Bank project to create First Direct. At that time I remember the goal was to attract 250,000 customers. It was therefore great to learn that the bank now has 1.25Million customers, a healthy balance sheet, is still growing, and has 36% of all new customers as a result of recommendation or referral from existing customers. The part of Chris’s presentation that struck me most was what he explained about one of their key measures. Since the work done by Fred Reichheld of Bain and Co. into what he calls “The Ultimate Question” many organisations have used a version of the “Based on your experience as a customer would you recommend us to others” question to help them establish just how good there product and service delivery is at driving customers’ behaviour. However First Direct use a similar but different question which they believe is more revealing. The difference is they don’t ask ‘would you recommend?’ they ask ‘have you recommended?’ This moves the answer from intention to action and I guess for many businesses it would seriously reduce the score they get. First Direct get a 96% positive response to this question, which is both amazing and a testament to the success of the way they have made customer service a core element of their success. Maybe you should try it too to see just how much the experiences you provide are actually rather that potentially influencing customers to recommend your product or service. Sir Ranulph Fiennes – The World’s Greatest Living Explorer Sir Ranulph is an extraordinary man with a great wit. His presentation was slick and polished with lots of wry humour. There were many interesting points that he’s learned from exploring the World that are relevant to business generally and service in particular but a key one for me was about the selection of people for teams. In his words – “Whenever feasible, pick your team on character, not skill. You can teach skill. You can’t alter character” That’s a lesson for all of us. If you hire intelligent people with great character you can teach them the skills necessary to be great at customer service. If you hire skilled people with poor character, no amount of training will make them great customer service people. So as any great chef will tell you, the end product is absolutely dependant upon the ingredients you choose to work with – so only choose the best. Edward de Bono – World Leading Authority on Creative Thinking I’ve now seen Edward de Bono at a few conferences and although the core of his presentations is always the same – how to think - I always learn something new. What got me thinking the most from this presentation was his point that ‘90% of thinking errors are due to perceptions - NOT logic’. In other words we usually come to the wrong conclusion or decision because we perceived a wrong situation, NOT because we applied the wrong logic to what we perceived. This made me think of one of Stephen Covey’s 7 Habits, ‘Seek first to understand, then to be understood’. I guess most of us are guilty at times of focussing more on being understood than on understanding. We’re keener to get the other person to see our point of view than we are to see theirs. But if Edward de Bono is right, and most thinking errors result from wrong perceptions, we should spend more time soliciting, listening to and striving to understand other people’s perspectives, and that would make us better decision makers. Day 3 – Main Conference Day 2 Marcus Buckingham – Renowned Expert on Outstanding Leadership and Management Practices Marcus was for me, one of the two people at the conference I learned most from. His presentation style was confident and captivating and his thoughts were logical, based on sound research, thought provoking and above all simple to understand. I took 3 key points from his presentation. He called them three ‘truths’ that blew apart three ‘myths’ of management and personal performance. Myth 1 – Personality changes over time - Marcus says this is not true. The truth is that as you grow you become more of who you are. The lesson from this is that a business can’t change people’s character and shouldn’t attempt to do so. People are what they are. So make sure you have a recruitment system that will find out what a person’s character is before you employ them. And then only hire the people who fit the personality/character profile you’re looking for. Myth 2 – The best way to improve is to focus on your weaknesses – Also not true according to Marcus. He says the truth is that you will always grow most in your areas of strengths. An interesting discovery for me about this is that Marcus has found through research that in performance and behaviour the opposite of BAD isn’t GOOD – it’s NOT BAD. But NOT BAD looks nothing like GOOD. So you don’t learn how to be good by studying what bad is and doing the opposite; you do it by studying what good is and doing more of it. This means that most of us must have got it wrong many times. As individuals we spend far too much time worrying about what we do poorly and no where near enough time concentrating on what we do well. And as leaders (and parents?) we focus too much on ‘where you need to improve’ and too little on ‘what you’re great at’. So why not try a change of focus, say for just six months, and see if an intense focus on strengths, in you and your colleagues (and children) will make the dramatic difference that Marcus is convinced it will? Myth 3 – In a team you should suppress your personal strengths to focus on team strengths - Marcus insists this also is not true. The truth is that you will contribute most to a team when you offer up your strengths. We’ve all heard the saying ‘There is no I in TEAM’. That may be true but Marcus quoted Michael Jordan who responded to that statement with ‘Yes, but there is an I in WIN!’. The point is that individuals’ best serve a team not by suppressing their strengths but by exaggerating them. The key therefore is to select team members that have different but complimentary strengths so that synergy and high performance will result. Jacqueline Gold – CEO - Ann Summers and Knickerbox Jacqueline was the only woman on the main conference stage and it was good to hear about great success from a female perspective. She’s a remarkable woman who’s built the Ann Summers business from just £80,000 when she bought it in 1980’s to £155Million now. She’s also a really feisty woman who is undaunted by big challenges, will not accept rejection or failure, and will certainly not be told that she isn’t running a serious and respectable business. For example, when she was banned from advertising for staff in Job Centres she took them to court - and won! The key lesson for me in her presentation was her commitment to learning from her front line people. She took part in the BBC ‘Back to the Floor’ programme a while ago and admits that she learned so much from that experience that its now a part of every year’s activities for her and all her management team. I think we can all learn from that. It’s at the front line, where customers are, where we earn profit, and where leaders should spend as much time possible, to learn, at the place it matters most, what’s really happening in their business and how best to improve it. Malcolm Gladwell – Author of ‘The Tipping Point’ and ‘Blink’ I’ve read and enjoyed both of Malcolm’s books but the key point for me in his presentation was the key message from his book Blink. It’s that intuition is usually right, your ‘guts’ know much more than you probably give them credit for and Grandma was right: first impressions do count. Over numerous stories and examples from research he proved his point that we should listen to and trust our instincts much more that most of us do. Instincts are experience telling us what we know to be right but don’t know why or can’t explain at the time. It’s interesting that at a meeting of business leaders from different organisations that I facilitated earlier this year, one of the conclusions they came to was that leaders should have more faith in their gut feelings. They should act on them quickly, and decisively, and not go through the long and often advantage losing process of finding the evidence to prove their guts right. I think they and Malcolm are right. Trust and act on your instincts. Jack Welch – Former CEO and Chairman – General Electric Jack didn’t give a presentation. He and I had a conversation about a few business issues that I knew he viewed as important to success and would be of interest to the conference delegates. There are three topics we covered that I want to refer to now. The first is related to the key role of a leader. As Jack explained, when you become a leader, your success thereafter becomes dependant upon the success of those you lead. He believes that a leader’s first responsibility is to set the direction for the business and its people (vision/mission/goals). The leader must make it clear to everyone what the purpose is of their work. He/she must then clarify the acceptable and unacceptable behaviours along the way – the way things are done around here (values/principles/beliefs). That done the job then is to select, attract, improve and retain the best people. To help make this happen Jack believes that the HR person on any board should be just as important and powerful as those from Finance, Marketing and/or Operations. Just as in any sport, winning or losing is dependent above all else on the quality and morale of the team players, so it is in business. That means a constant search for the best people to join the team and a constant effort to develop the best people in the team. It also means a constant cleansing of the team by removing any people that are not good enough. The second topic refers to the annual Budget round that is detested by so many people in business. He hates it too. He thinks it is counter productive and creates a situation where people battle with each other to find an arbitrary number they can all live with. No one wins in that scenario. In GE he found a way to replace Budgets with what he called Operating Plans and Stretch Goals. These are the result of meetings where people work together, on the same side, seeking out the best that could be achieved and agreeing how they can all help make it happen. The only measures that are used in this system are ‘How we perform against last year?’ and ‘How we perform against the competition?’ Bonuses are then earned based on answers to these two questions only – never on the basis of ‘How we perform against budgets and/or targets’. The final one is his belief that many academics have got it wrong when they claim that aiming for ‘best practice’ does not create competitive advantage. He is convinced that the opposite is true. Best practice ideas obviously must be used better and quicker and continually improved at a more rapid rate than competitors. But if you search out best practice, no matter where it comes from, and then adapt and apply it well, with enthusiasm, commitment and energy, Jack has no doubt that you will create sustainable competitive advantage. (More about all the above can be found in his book Winning.) So there’s my review of the 2006 European Conference. As I stated earlier, in my view, it was the best yet. ------- xxxxx ------- Well that’s it for now. I’m sorry it’s a bit of a long one, but there was a lot to tell you about the European Conference and I hope you found it interesting.
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