Art Petty on Management

Art Petty on Management Has Changed and Moved

I don't like to do things small or simple, so in what I sincerely hope is the absolute last time I put myself and you through this, I have moved and changed the name of my blog. 

You will now find me at www.artpetty.com and the new name of the blog is Management Excellence.

As I'm writing this and realizing that most people that have moved blogs have basically had to start over from zero to build traffic, this seems like taking two steps in the wrong direction.  However, sometimes you have to step back to grow, and I've got some compelling reasons for making the move, including:

• Integrating my former corporate web site and my blog under one content management system.

• Creating a simpler url (artpetty.com...12 characters versus the almost 40 for this site).

• Gaining the tools and the control through a hosted blog so that I can easily add planned podcasts, webcasts, forums and other tools that I will roll out this year.

• Aligning my blog's name: Management Excellence with my personal mission to promote high performance, great leadership and the pursuit of excellence in business.  

All of the posts and hopefully, all of the comments have been moved to the new site, so 14 months,  160 plus essays and a tremendous number of thoughtful comments on best practices in leadership and strategy, project management, product management and marketing and sales, all remain part of the library. 

For those of you that subscribe via your favorite Reader or happen across this post via Search, please take the opportunity to visit the new Management Excellence site and click on the site's feed.  And don't forget to check out some of the new tools, including the live polls, free down-loadable tools and links and references to many other great resources.

Thanks so much for reading and referencing Art Petty on Management, and I hope to earn your confidence many times over in my new home at the Management Excellence blog!

Does Your City Government Treat You Like a Customer?

This is my pre-election post on government, and I promise to stay focused on performance and not politics.  There’s enough hot air being expended by the candidates and pundits and I don’t need to add to the global warming.  However, it does seem like a good time for all of us to evaluate the return we are getting from government and frankly, ask for more.  And by more, I don’t mean more money or even government. I mean quality, performance, results, and yes, even a bit of good old-fashioned customer treatment. 

A great example of government delivering on its responsibilities for its customers…yes, I said customers, is 2007 Malcolm Baldrige Award Winner, Coral Springs, Florida.  The city of Coral Springs won a Baldrige Award for Performance Excellence, a feat that is remarkable for even the best of businesses. 

A little bit of background on this post.  I am working with a talented group of MBA students at DePaul University in Chicago studying the Baldrige program as a framework for performance excellence.  We are looking at the practices and results of great companies in all sectors of the economy,  and the idea of performance excellence in government seemed like a fitting pre-election topic.  As a group, we struggled to recall if and when we had ever felt like “customers” much less “satisfied customers” in our dealings with our community governments. 

As an aside, most people mistakenly associate Baldrige with just quality, when in fact it is one of the most comprehensive programs in the world in challenging and guiding organizations to become great at creating value for stakeholders.  Of course, quality in all facets is at the center of this high performance formula.  Coral Springs is the only municipal government to win this award to-date, and offers some powerful lessons for all of our communities as we head to the polls to elect our leaders next week.

A few noteworthy points:

• Coral Springs truly views its citizens and businesses as customers and designs all of its services to maximize customer satisfaction.  From Saturday hours to their “City Hall in the Mall” facility that provides added convenience for people going about their normal business.

• The city is a model of strategic planning effectiveness, engaging stakeholders in the development of a strategic plan and importantly, the development and execution of this plan around clearly defined goals and objectives.

• Continuous improvement is inherent in this community’s emphasis on measurement and control of critical processes.  From customer satisfaction to employee and volunteer satisfaction, to focusing on measuring, monitoring and improving around the processes that create value for citizens and businesses, Coral Springs runs like you would expect the most quality conscious business to run. 

• The results are clear and visible for all to see in the form of ongoing reporting of key performance indicators to remarkable achievements in delivering what the customers deemed important in a high-performance community.  From schools to traffic to safety, the community appears to have achieved results that most communities will envy.

The Bottom-Line for Now:

If you are intrigued and want more tangible information on what a city government looks like when it clearly identifies its customers and holds itself accountable to creating value for those customers, take a look at the Baldrige Video at the city’s website.  Do yourself a favor and watch the long-form of the video, preferably before you head off to the polls to elect or re-elect your city officials.  Better yet, send these officials a link and ask them if they understand who their customers are and what you expect.  Perhaps if we all hold our officials accountable, we might just get a reasonable return for our investment.  About now, any form of positive return would be good. 

 

“If I had asked customers what they wanted, they would have said faster horses.”

Students of business history might recognize the quote above as coming from Henry Ford, the founder of Ford Motor Company and one of the early management innovators.  Mr. Ford’s quote raises a profound issue of when and how to listen to customers, or perhaps the more challenging flip side: when not to listen to customers.

The notion of not asking customers what they want and responding directly to their needs may seem like heresy to those individuals and organizations consumed with improving customer satisfaction and creating customer loyalty.  In fact, you should always listen and importantly, observe.  The real art in this process is understanding what customers really need, what problems they really would like to solve and what approaches and experiences that you can create that can surprise and delight them.

Harvard Professor, Clayton Christensen, seized upon this issue in his Innovator’s Dilemma/Innovator’s Solution books, where he suggests that a well-intentioned business may do everything right by listening and responding to customer requests, and ultimately fail as disruptive offerings upset the status quo.  

In my own work in the technology space over the past two decades, it is easy to look back at product development cycles driven by a never-ending desire to cram in customer-driven features, without a good understanding of why those features were needed and whether they were solving key problems or attacking symptoms.  It always felt like we were doing the right thing, but in hindsight, it was blind marketing. As Product Management systems improved and requirements development received more scrutiny, this situation improved.  Nonetheless, it is hard to see how the forest is changing when you are staring so intently at the trees. 

Christensen’s classic scenario is the company that dutifully enhances its offerings based on client input, ultimately creating bloated offerings with capabilities far exceeding what might be required of many or any buyers.  In the interim, a disruptive offering…something perhaps with fewer features and priced much lower (not always the case) can easily swoop in and…well, disrupt the market.  In essence, the well-managed, well-intentioned company created a vacuum that was filled by someone who understood the essence of the client’s problems…not just the features they were asking for.  (Think “Faster Horses” versus a new mode of transportation.)

The authors of the recent book, Tuned In, tackle this important topic by suggesting that a firm focus on developing Resonators, products or services that practically sell themselves.  Their six step process for creating a resonator and for Tuning In is in my opinion, a framework for avoiding the Innovator’s Dilemma that Christensen warns us about.

The design firm Ideo in their famous Deep Dive segment on ABC News showcase a process for design innovation that is what you might imagine a sociological dig would look like, as they follow and observe the various “buyers” of shopping carts in pursuit of understanding how this classic device could be grossly improved to better solve real problems.  While there is a fair amount of criticism of the “made for TV” nature of this episode, it offers some classic lessons in looking and observing to identify significant and perhaps even disruptive improvements.  Just asking a store manager or a customer about what they would like to see improved in their shopping cart may be insufficient for identifying what a shopping cart might actually be able to do.  Think cell phones and the iphone. 

The Bottom Line for Now:

My message here is intended as a cautionary tale.  It is good and right and noble to pursue increasing levels of customer satisfaction in your framework for operational excellence.  However, it is also easy to be misled by false signals, and sometimes those signals come from your customers.  Remember, they know you in a narrow context, so when they engage with you to talk about improving the Widgets that you make, they are thinking about you only as the Widget Company and as users of your widgets.  Their context is to give you ideas to improve your widgets. Just remember that it is quite possible that they don’t need a better widget or a faster horse. 

You need to build the institutional intelligence, the systems and of course the talent that truly focuses on understanding the unstated needs of buyers.  Of course, once you understand this, the real work of meeting and exceeding those needs as an organization begins. 

Lousy Customer Service Starts with Sloppy Leadership

Fresh off of a vacation and what seems like a thousand or so “interactions” with various service providers and merchants, I continue to be perplexed as to why we as consumers so easily accept and by default, encourage lousy customer service in our daily lives.  To my observation, receiving poor customer service is more the rule today than the exception. 

I’ve wondered if it’s just me eliciting the questionable service, but I have a standing policy to greet every retail/front-desk/agent/clerk/teller with a smile and a nice greeting in an attempt to create a positive exchange.  I can tell in a nanosecond of my approach whether the experience will be good or bad based on the response.  Too many experiences with large and small organizations end up in the negative column.

While I am fascinated (morbidly so) at the number of people that make their living through customer contact that don’t understand how to contact customers, I am mortified at the sloppy leadership practices and sloppy leaders that allow poor customer service to rule the day.  My armchair diagnosis is that these leaders suffer from an unhealthy mix of arrogance, apathy and ignorance.  They either don’t give a damn or don’t know.  Both are inexcusable. 

Aside from the obvious relationship destroying, bad-will creating outcome of delivering poor customer service at the point-of-sale, consider the bigger picture.   An organization spends an incredible amount of time and money in creating products and services, enticing you to try their offering and just when they finally have you where they want you, they shoot themselves in the proverbial foot by creating a miserable customer experience.   For example, I receive better service from neighborhood kids selling lemonade than most people receive from almost anyone in the U.S. airline industry. 

For decades, U.S. manufacturers ignored the rising quality standards in global competitors, and seemed genuinely perplexed when consumers voted with their wallets in favor of the best product, regardless of origin.  It took a few more decades for the firms that survived to recognize that designing quality into the product and processes wasn’t a new management fad, but rather it was the price of admission.  I see the same thing happening with customer service.

9 Suggestions on Customer Service for Executives, Leaders and Managers Everywhere:

1. Come to grips with the value creating, brand strengthening, loyalty building, buzz generating, lifetime value maximizing power of great customer service. 
2. Alternatively, come to grips with the cost-wasting, bad-will generating, brand destroying, competitor enriching power of lousy customer service.
3. Figure out what “great customer service” means to your customers and turn your organization upside down in pursuit of delivering it.
4. Design customer service into your offerings and processes just as you now design quality into your offerings.  Customer Service is a part of your “augmented” product. Fixing customer service after the fact is a lot more costly in many ways than building it into your organization and offerings up front.
5. Beware the lure of cost-cutting measures that have the potential to adversely affect customers.  Evaluate the customer impact carefully before proceeding.
6. Delegate power to satisfy customers down to the lowest possible point in the organization.
7. Reinforce a culture of customer service excellence by measuring, monitoring and rewarding for performance as well as for identifying and implementing improvements.
8. Seek specific, direct feedback from customers on their experiences.  Surveys are OK, observing, talking and asking questions are all much more tangible.
9. Get out from behind your desk and spend time where your firm comes in contact with customers.  Become a customer and evaluate your own experience.

Suggestions for Consumers Everywhere

• Vote with your wallet every single day. 

• Tell everyone about your experiences…good and bad.

• If you are in a hospitality environment, tip lavishly for great service, and remember to tell the server and the server’s manager about your experience.  (Do the same, minus the tip part for lousy service.)

The Bottom-Line for Now:

There is no excuse for lousy customer service ever.  Poor customer service is either a philosophical failure on the part of leadership or a failure to execute.  Regardless of the cause, the impact is the same. Poor customer service destroys your value proposition in the marketplace and degrades the efforts of everyone in the organization.  Is great customer service more than just a slogan in your organization?

Did Anyone Get the Memo on How to Act During a Slowdown?

You don't have to look hard to learn about the impact of rising fuel costs, including layoffs, plant closings, cutbacks, service reductions, fare hikes and new user fees.  These headlines and many more just like them blare from the tv and radio or jump out at us from the front pages of our morning newspapers.  However, what really amazes me is how hard you have to work to find examples of companies and leaders that received and read the memo on surviving, improving and even prospering during periods of economic difficulty.

I wrote about this topic a number of months ago (How Good Leaders Approach a Recession) suggesting that the best leaders take advantage of business cycle slowdowns to improve their organizations and set the stage for growth as conditions improve.  While I don't recall for certain, I suspect that I might have even suggested that it is possible for truly enlightened organizations to take advantage of the situation by flogging their competitors who are acting as if a slowdown means going out of business.  If I didn't mention it previously, consider it said: You can grow and advance during a recession.

The Airline Industry: How Not to Act:

The airline industry is generating a fair amount (bad pun intended) of the air time (another bad pun, sorry!) on bad news.  Rapidly rising fuel costs are further devastating the already not-for-profit U.S. airline industry, driving the companies to cut flights, cut employees, cut planes, reduce services, hike fares, add all sorts of new user fees in an attempt to survive.  While I never begrudge anyone the right steps to deal with costs, it seems that the net impact of most of the actions is to take one of the most miserable experiences that a human can go through (next to prison) and make it worse.  In the words of one of my favorite people on the planet..."We have a plan, it's not going to work, but we're going to do it anyway."

Hey airline industry, what about taking some steps to try and do something radical like offer something that encourages people to fly.  You've proven that punishing us with horrible service, uncomfortable equipment and extra fees for luxuries like checked baggage or rescheduling our flights don't work.  Why not Tune In to your buyers and offer us opportunities and experiences that surprise and delight?  Imagine,  trying to lure customers with something positive.  Radical.

Rumor has it one of the major carriers is working on rolling out a host of incentives that focus on providing consumers with good reasons to happily fill their planes.  Southwest figured this formula out a long time ago, and in my opinion, their current commercials mocking the fees of the other airlines by showing passengers inserting quarters for things like reclining a seat, accessing the restroom or opening the overhead luggage compartment, are brilliant.   Just like Apple has single-handedly rebranded Microsoft as a clumsy, lumbering, out-of-touch company with the "I'm a Mac" commercials, Southwest is showcasing how asinine the rest of the industry is acting.

Bottom Line: Other Thoughts on Prospering During a Slowdown in Any Industry

I didn't mean to make this a rant on the airline industry, but with 1 million air miles, most on United, I've earned the right to vent just a little.  Some other thoughts for leaders, managers and concerned corporate citizens everywhere:

• Thump your competitors if they'll let you. If your competitors are responding to a slowdown by acting like they are preparing to shrink, launch a frontal assault and seek to grab customers while the grabbing is good.

• Give us reasons to buy, not avoid your product or service. Offer positive encouragement. If you own airplanes you want butts in seats and if you make cars, you want the same.  Help us solve our problems and offer us some good reasons to take that vacation or consider you when we need a new car.

• Be positive.  Manage the flow of noise from your organization to ensure that it is weighted in the right direction.

• Create experiences for your customers that "surprise and delight." 

• Monitor what's happening in places where your customers come to buy.  (Home Depot, you lost my lawn tractor purchase last week, because no one in your store would take the time to talk to someone clearly ready to buy.)

• Topgrade your team.  The right people make you great.  The wrong people have you punishing your customers and sewing the seeds of your own demise. 

• Plan and act to prepare for improving conditions.  Prune your project portfolio to those that are most strategic and support them to the hilt!

My next assignment is to seek out examples of companies actually doing some of these things.  If you've got some examples, let us know.  I have to stop typing  now, I've finally reached the ticket counter and I need to pull out my credit card to pay for: the baggage fee, my flight change and my fuel surcharge.  Uh oh, the ticket agent looks angry. And oh yeah, I need a few singles for the bag of peanuts on the flight. 

 

The Raw Marketing Power of Passionate People in the Workplace

For those of you drawn to this post in the hope of finding something juicy about workplace romance, keep on clicking.  This is about romance of the professional type.  It's about the powerful impact that someone with passion for his or her job has on the working environment and ultimately on the success of the enterprise.

A passionate employee is like rocket fuel for your organization.  These rare and valuable people build your brand, strengthen client loyalty, stimulate repeat business and energize your workplace just by their daily participation in your business. 

The Best Marketing Ever: Employees that Surprise and Delight Customers

When was the last time that you had one of those "Wow" experiences as a customer, where you walked away "surprised and delighted" about how you were treated?

Travel a lot?  It probably doesn't happen for you with the major air carriers.  Most of my customer experiences with the airlines leave me shocked and disgusted. I'm convinced that the airlines study Customer Service Secrets of Attila the Hun.   Shop in Big Box retail stores?  Similar story...perhaps without the edge of nastiness that the airlines (or cell phone or cable) companies have mastered. 

All of this changed for me recently, as I found myself on the receiving end of two different transactions that left me absolutely surprised and delighted.  And no, they didn't take place with an airline, cell-phone, cable or big box company.  They were two retail establishments that clearly didn't get the memo that you have to be nasty to your customers to succeed in this world.

What is it about leaders that tolerate poor customer service from their employees?