Service failure recovery

 

“Your most unhappy customers are your greatest source of learning.” – Bill Gates.

This is true.  Your unhappy customers are disinclined to pull punches.  They will tell you exactly what went wrong.  They will tell you want they don’t like about your product, and they will often make suggestions on how it could be better.  And, listening to them can win them over.  Happy or neutral customers won’t usually give you feedback.  In this social media driven environment, your unhappy customers can easily discourage your neutral customers from buying your products.  Turning the unhappy ones around by listening to them can’t undo all of the damage, but over time it will get better.

After all, look at what happened to The Home Depot under Bob Nardelli.  Lots and lots of unhappy customers and employees.  Finally, someone listened.  Nardelli was out, Frank Blake was brought in, and the culture is changing for the better.  People have been talking about the change in the store management, and their shoppers are returning.  It takes time, but they are getting there.  The Home Depot learned from their unhappy customers, they listened, and they acted on it.

 

Lucky you

“I feel that luck is preparation meeting opportunity.” – Oprah Winfrey.

I like this statement.  I would add one thing to it: flexibility.  You can prepare yourself to be ready for an opportunity, but if you have a set opportunity in your mind, you may not recognize all of the great opportunities that are out there, no matter how prepared you are.  Open your eyes and be willing to change your perception of how you define an opportunity.

This reminds me of a story.  I was working an a call center years ago (horrible job, by the way), and I was in a select and close-knit department.  I was new to this department, so I hadn’t formed any close associations, but some of my co-workers had been there for 30 years, and I sat near many of them.  Every now and then, the area would shut down for a briefing from the supervisors, and one day I was stuck on a call during the briefing.  I wrapped up the call when my co-workers were coming back, so I asked them what was going on before I saw their faces.  They were livid.  They proceeded to tell me that our department had been assigned 2 new supervisors coming out of the leadership development program.  One of them, “Carol” was a woman who had been best friends with someone who had been in the department, “Suzy”.  It turns out, Carol had carried on an affair with Suzy’s husband (who also worked in the building) while Suzy was pregnant (2 pregnancies actually, the first one sadly ending in a late-term miscarriage).  Suzy had transferred to a different part of the company about a year before I’d joined this department, so most of the department was very against Carol.  Management knew this, so they assigned those of us who’d been there less than a year to Carol.

Now, I could have held what I’d heard (and I got an earful!) against Carol, but what would that have helped?  Did I like or agree with what she’d done?  Of course not.  But, I decided that what had happened didn’t directly affect me.  It really wasn’t any of my business.  What was my business was the fact that she was now my boss.  Knowing the background did help me, because I knew that she would be more inclined to like someone who was nice to her.  So, I never gave her a hint that I’d heard the stories, and instead treated her like the awesome supervisor that I knew she could be.  And that woman delivered!  She supported me and my ideas, she was flexible and agreeable, and she was genuinely helpful.  When I was interviewing to leave the call center (did I mention that it was a horrible job?) she pulled me off the phones to mock interview me so I could go into my interview more confidently.  She worked with me regarding my last day in the department, and gave me a Hallmark card congratulating me on my move.  Maybe she would have done this for anyone, but I really believe that it helped tremendously that she knew I had to have heard about her past and I didn’t let it affect how I treated her.

All of that to say this: if I had not been flexible, I may have missed the opportunity to have the best supervisor in my career.  I could have seen her as a walking disaster and avoided her at all costs.  Instead, I saw an opportunity to have a supportive and beneficial relationship.  And for that, I feel lucky.

Put yourself in your customer’s place

“The golden rule for every business man is this: Put yourself in your customer’s place.” – Orison Swett Marden.

So, I think by now everyone knows that generally, it is easier and more cost efficient to keep an old customer than it is to get a new one.  Taking into consideration the pain of switching costs for your customers, they will be inclined to stay with you – until your competitor offers them a sweet enough deal to overcome that pain.  So, how to balance your business needs (like how much you’ll do to keep a customer) with customer retention?

Well, putting yourself in your customer’s place is a good start. You aren’t an autonomous being; you are also a customer.  So, what does it take to keep you as a customer?  What do you want from your suppliers, your child’s daycare center, your bank, your utility company, your cable provider?  Are you easily swayed by an introductory offer, or will you stay with a company that treats you well and offers a reasonable price?  Will you put up with being treated like crap in exchange for a super cheap deal?  Will you pay extra for red carpet treatment?  When considering your core customer base, think about what their concerns are.  Some people want that red carpet service on a budget – can you provide that?  If not, don’t you dare promise it.  Under promise and over deliver.

What about things that are very occasional?  Like a real estate agent or carpet installer?  Just because the transaction is done doesn’t mean that you stop being a customer – you just move more to the experienced reference side of the customer experience.  What do these occasional providers need to do for you to recommend them to friends and family (or better still, how far can they go before you warn your friends and family)?  My real estate agent was wonderful, and she was a reference from a friend in the area.  I will recommend her to my friends when they are looking to buy or sell.

When you are working with customers, remember what it is like to be one.  Teach anyone who works for your company to remember what it is like to be a customer, and to keep in mind how they would want their friends and family to be treated.

“You get what you pay for”

Hat tip to Ask a Manager for making me aware of this video. I’m afraid I might have more to say about my ex putting a contract on me than his inference that she shouldn’t have been cheap.

Is anyone surprised he got fired?

 

So, I know I’m a little late to this one, but as the story continues, I’ll put in my 2 cents.  As you may be aware, Chick-Fil-A President Dan Cathy was interviewed and asked about his personal beliefs.  This kicked off a firestorm about same-sex marriage and the role of businesses and their officers.  In response to this firestorm, conservative Mike Huckabee promoted a Chick-Fil-A appreciation day on August 1, 2012 for people to show their support of the company.  There were also same-sex marriage supporters who organized a kiss in rally to show support of their values, and calls for boycotts, and a bit of vandalism.  The mayors of Chicago and Boston got involved.  None of this will really be elaborated on here (and has, in fact, been greatly simplified), because this post is focused on this YouTube video, showing Adam Smith, the CFO of Vante, Inc. harassing Rachel Elizabeth, a drive-thru worker at a CFA in Arizona while she remained composed.

Really dude?  What part of this could have really seemed like a good idea?  You didn’t like what the President of the company said, so you took it up with the worker at the drive-thru of your local CFA in Arizona, rather than the man himself (who is located in Atlanta)?  You were rude and disrespectful, which would have been bad enough, but you video taped it and posted it on YouTube.  Why?  What purpose was this supposed to serve?

The CFO of any company needs to be able to inspire confidence as someone who remains cool under pressure, doesn’t make truly bizarre decisions, and can separate their emotions from the matter at hand.  After all, he is responsible for their finances.  If you work with money, you need to be reliable and level-headed.  Smith had options in this situation.  He could have just joined the boycott and quietly encouraged his friends and family to do the same.  He could have written to Mr. Cathy’s office to voice his displeasure respectfully.  He could have written an opinion piece if he really had to publicize his feelings.  The rant could have been a momentary lapse in judgement, except that he taped it and posted it on YouTube himself.  This wasn’t security footage or a bystander taping it and exposing him – he exposed himself.

So he was promptly fired.  He dragged his company into the national spotlight and put a big, black mark on them.  He did this as an officer of the company, and they were embarrassed.  I have to wonder if this was a truly odd moment in his pattern of behavior, or if this was foreseeable.

Now he’s very sorry for what he did and apologized to her through Inside Edition (I was not actually aware that this show was still on).  In fairness, he did go to the store the day after his rant to apologize to her in person, but understandably she wouldn’t see him.  I wouldn’t want to take the chance of a second dose of his vitriol.  I wonder how long it will be before he claims a substance abuse problem and checks into rehab?  Meanwhile, his family is paying the price for his public display of poor judgement.

Ms. Elizabeth, for her part, not only displayed decorum that was widely praised, but she has publicly forgiven Mr. Smith, and she feels sorry for him.  I don’t know anything else about her, but I would be willing to bet that her future will be pretty bright – temporarily because of this, but permanently because of her overall demeanor. As you are out and about can come across unpleasant people, try to think of what Rachel Elizabeth would do.

So, what do you think folks?  Do you agree with the decision by Vante, Inc. to fire him?  Do you think it’s likely that he’s displayed questionable behavior before, or do you think that this was an aberration?  Is there anything that Vante could have done to have prevented their association with this mess?

 

Hiring Enthusiasm Over Skill

 

“I rate enthusiasm even above professional skill.” – Edward Appleton (found on brainyquote.com)

It’s tough to hire people. Everyone is giving you their very best face and their very best accomplishments on a piece of paper, and there are no high reliability methods for weeding out the best candidate.  Unless it is someone with whom you worked in the past, you don’t really know any of the candidates, and usually they will all be total strangers.  You can try to vet them through a background check and references, but a background check won’t really tell you if they are organized, skilled, or frankly competent.  Their previous employer may have, um, issues (they are probably just as much of a stranger as the candidate, and you know even less about that manager since you don’t even have their resume).  I can’t really give an answer that will make those problems go away – after all, we’re dealing with people here, and the variety is astounding – but I will be so presumptuous as to give a suggestion: Hire the one who really wants to work for you AND can do it well.

Why focus on the person who really wants to work for you?  Well, you don’t want someone who isn’t enthusiastic about your company, your products, and your customers.  Enthusiasm cannot be taught.  It really can’t.  It can be stirred up (think “Win one for the Gipper!!!”), but something has to be there for it to be stirred.  However, you can teach Excel, Access, Oracle, and any other software out there.  You can also teach filing, forklift operation, and dog grooming.

So, which is better, the candidate who has 95% of the qualifications, an odd undergrad degree, and an MBA (along with solid progressive work history) who has demonstrated a desire to work for your company, or someone with 100% of the qualifications, the “right” undergrad degree, and doesn’t particularly care about you or your company?  They may not need quite so much training at the beginning, but whatever time you saved in those first few weeks will come back on you with mediocre work.  Plus, you can negotiate salary more easily with the 95%er, rather than finding yourself against the wall with the one candidate who fit all of the criteria and you liked enough during the interview to bring into your life (and you better believe they will be in your life).

Having someone who cares about your company and can do the work should be awesome.  So, why have so many companies fallen into the exact requirements match trap?  Well, maybe it’s because that is the quickest way to narrow down the list of candidates for each job, but what have you done?  You’ve focused your requirements down to where the only people who qualify will be bored, disenfranchised, and leave.  That’s not smart recruiting.  Someone with room to grow will be more engaged.  If they are also really interested in your company, isn’t that even better?

Recruiters, please tell me in the comments the justification for filling a job with a candidate who has no room to grow within that job?

 

Budgeting Blues

 

“A budget tells us what we can’t afford, but it doesn’t keep us from buying it.” – William Feather (found on brainyquote.com)

Ah, budgeting. If only the reality of the future would bend to our will and follow our plans. But obviously it’s not the budget’s fault that things didn’t zero out. Many things can happen to bust a budget, and most of us know what those things are. My thoughts on this subject lean more toward the people behind the budget and the negative activities associated with it.

I’ve seen the budgeting process used in several ways. One is something I call “budget promotion”. In the planning stage, I’ve heard of managers using it as a power play to make their positions seem important by the amount of money they need to spend. In one example, I heard of a manager inflating their budget with a project list that was inflated in the number of projects they intended to start in that year. The manager was trying to get a promotion, and the theory was that their angle was to seem like such a superstar (“Look at all I’m doing!”) that they would be promoted and the actual execution of the huge and expected project list would fall to someone else, and thus be their problem/failure. Turned out, the promotion didn’t come along in time to save the manager from being directly involved in most of the projects not leaving the high level planning stages due to resource limitations (time and manpower). The manager looked like a poor planner at best, and an incompetent egomaniac at worst. No promotion! Do you have a similar story? Have you seen this yourself? Have you been on the receiving end of the inflated project list when someone was promoted via budget promotion?

Another tactic I’ve seen is the “budget as discipline tool”. Say you have a need to capture the way resources are used so they can be compared to the actual spend on that resource (in this example I’ll use parts for fleet cars). You want to see in your fleet inventory work orders which vehicles are using the most parts and are thus candidates for replacement. You require your mechanics to enter any parts used into each work order, but you can’t help but notice that the amount of parts recorded in the work orders is about 15% of what you bought. The ball is being dropped somewhere, and no amount of reminding has helped. Enter the discipline tool: next year’s budget will be based on the amount of parts spend captured on this years work orders. To my knowledge, it didn’t actually work. I think in this case an interim solution could have been used: really explain the purpose of the exercise to those involved, get everyone on board, and have the managers responsible for the work unit review the work orders before they could be closed out, and tie in a reward system to high compliance. Have you had the future of a budget utilized as a discipline tool? (More on reward systems in another post).

Finally, there is one tactic that I think is the most obvious and should be easily detected by now: gamesmanship. Managers set their budget for 10% more than they actually plan to spend, and their bonus is tied to coming 5-10% under budget on a sliding scale. Naturally, they are going to spend what they need and meet the goal, claiming a bonus that may not be much less than the “savings”, and could be more. And they look like a high performer while gaming the system. So, how to detect the gamer? I’d be willing to venture a guess that anyone with something to gain is going to stack the deck in their favor to some extent, but what I’m talking about is the true gamer, the one who is taking you for a ride. Unfortunately, gaming can be hard to detect and harder to prove. So, how do you stop gaming? Remove the budget driven bonus. But if there is nothing to gain, you may not see the “savings”. Maybe that’s ok. Maybe, at the end of the day, it’s better to have a budget met as part of the responsibilities of the job instead of beaten as part of a game (at the least, it’s more honest). Base bonuses and other rewards on something that is harder to game, like employee and customer feedback, along with objective measures like reducing problem resolution time and reducing department turnover. What do you think? Are you a budget gamer?

Obviously, the budget is not going to go away anytime soon (or maybe anytime ever). It will never be a process that is fun for everyone. But I don’t think the word has to have such negative connotations, many of which I didn’t even touch upon here.

 

Leading by Example

“If there is such a thing as good leadership, it is to give a good example.” – Ingvar Kamprad (emphasis mine)

I hate double standards and hypocrisy. I really do. When someone applies rules and standards to you that don’t apply to them, at least three things happen: 1.) the rule and/or standard loses value, 2.) you lose respect for that person, and 3.) the relationship is damaged.

In business, as in life, you learn from those who have gone before you. When you were a child, you learned almost everything from your parents, from table manners, to saying thank you, to turning off the lights when leaving the room. Your first inclination was to mimic. It’s a strong inclination that stays with us (or at least, it stayed with me). But what if your parents didn’t like what they saw when you did it? Did they see and accept that you learned it from them, or did they ask you where you learned such a thing (or just blame it on a kid at daycare/school)? When someone is following your lead, be sure that you are actually showing them the behavior you wish to see. It makes life soooo much easier than to constantly set a bad example and reprimand for the results. If you don’t want your kids to use foul language, stop using it yourself (all the time, always, so it’s a habit). If you want your kids to say please and thank you, say it yourself. Setting the example you wish to see emulated gives more value to the standard, and shows respect for the follower. It’s win-win. It’s simple. No more “do as I say, not as I do”. People still quote Ghandi’s “be the change you wish to see in the world” because at some level we recognize that for someone – your child, your friends, your team – change starts with you. Doing things right, and doing what is right, starts with you. You are the only one you can control – but you can influence the others. Be a leader all the time.

Bringing it back to business: don’t be the manager who regularly comes in at 9:30 am and reprimands someone on the team for regularly coming in a 9 (because someone who arrives at 7 am doesn’t like that their teammate comes in at 9, even though they could come in at 9 as well). Don’t be the manager who flies off the handle at the rude guy in logistics, but demands the highest level of customer service from the team. Don’t be the manager who shows favoritism. Don’t be the manager who accepts sub-par work from the C players and demands the highest level of competence from the A players. It doesn’t just make you look bad, it’s bad for business when your best people leave. And they will leave. Why wouldn’t they? The grass may not be greener, but maybe they just want different grass.

So, remember your influence. Are you being the kind of manager you would like to for? If someone from your team followed your example, would you be proud? If someone from your team was interviewed (for a book or article on leadership), would they praise your fairness, or would they say that you were a Dr. Jekyll/Mr. Hyde (and more often Mr. Hyde)? How about someone who used to work for you? Obviously, you can’t control what people will say or feel about you, but don’t give them specific examples of bad leadership.