Wednesday, May 15, 2019

Leaders Need to Show, Not Just Say

Image courtesy of Pixabay
How do leaders drive (lasting) change?

Last week, I enjoyed spending a few days in Vegas, speaking and networking at Fiserv's annual client Forum. The keynote on the second day of the event was Troy Aikman, who was interviewed by Fiserv's CEO Jeff Yabuki about sports, of course, as well as about leadership and business.

One of the stories that Troy shared resonated with me because it's exactly the kind of thing that I talk about when it comes to driving lasting change: leaders can't just talk the talk; they must walk the walk.

The story goes something like this.

Troy is a sharp-dressed man; when it comes to work/business, he is always dressed in a suit. After he bought his first car dealership, he walked in and noticed that all of the sales guys were dressed casual, in polo shirts and slacks. He wanted them to dress nicer, but he didn't want to come into his new business and be a hard nose right away. So, he didn't say anything. Instead, he just showed up at the dealership every day in a suit. By the end of the first week, a couple of the guys had upgraded their attire, and by the end of the second week, all of them were dressed in suits. And he never said a word!

It's a great reminder that you can drive change - lasting change - when you do a few simple, yet often forgotten, things. Troy didn't talk about any conversations he had with the staff after the two weeks, but I can only imagine he applauded their actions.

To drive lasting change...
  • Communicate the change, using a variety of vehicles and media. Share the change vision. Tell the change story. Let employees know what is changing, why it's changing, how it will impact them and what they do (differently) on a daily basis, and how they will be involved. If no one knows what the change is or why it's taking place, then they'll ignore it; they certainly don't want to be a part of it.
  • It's important that executives lead by example and model the change that they wish to see from their employees; if they don't live the change, why should employees?! If your CEO doesn't demonstrate commitment to the transformation by being the role model for how to deliver a great experience, it won't happen. If she doesn't live the core values, why should you? Actions always speak louder than words.
  • Recognize the right behaviors and reinforce with incentives, promotions, metrics, and more. Reinforcing the behaviors, actions, and changes that you want to see is more powerful than talking about them, especially when combined with modeling them.
  • Involve employees in the change process rather than forcing change on them. If they're involved, the solutions may be richer because they have other perspectives and experiences that the decision-making leader may not have. Better yet, present them (spoke or unspoken, as was the case with Troy) with a problem or a situation, and let them come to the conclusion themselves. If they believe it was their own idea, it'll stick; they'll own it.
Yes, change is hard. But it's not impossible. These four things are important and work together. Just remember this: leaders can't expect to see change happen if all they do is talk about the changes but don't do things differently themselves. Case in point: if you're talking about transforming your culture to one that is customer-centric, yet you continue to push staff to make their quarterly numbers and reinforce behaviors that speak to a focus on growth at all cost - sans focusing on the customer experience - then you're not walking the walk.

Talk is cheap.

If you cannot prove it by your action(s), you do not mean it. -Murad S. Shah


Wednesday, May 8, 2019

Focus on the People and the Numbers Will Come

Image courtesy of Pixabay
I originally wrote today's post for CallidusCloud. It appeared on their blog on July 12, 2018.

When companies focus on people, their people - employees first, then customers - the numbers will come.

This is a tough concept for a lot of executives to grasp. They know the old management adage, companies are in business to maximize shareholder value, all too well. And that knowledge typically equates to focusing on marketing and sales first, i.e., do whatever it takes to acquire customers, drive sales, grow the business, etc.

But if they change the focus, shift the mindset, to adopt Drucker's definition of the purpose of a business, to create and to nurture a customer, then things start to change. Nothing changes if nothing changes, right? But when they put the focus on employees first, ensuring employees have a great experience, employees will then, in turn, deliver a great experience for their customers.

Not convinced of this? Or trying to convince your executives that this is real? Here's something to turn the tide. Take a look at the service-profit chain. I've written about it before, but let me go into a bit more detail here. It is a concept well documented in the 1997 book by the same name, written by James Heskett; Earl Sasser, Jr.; and Leonard Schlesinger.

From the book...
Simply stated, service profit chain thinking maintains that there are direct and strong relationships between profit; growth; customer loyalty; customer satisfaction; the value of goods and services delivered to customers; and employee capability, satisfaction, loyalty, and productivity.
and...
The strongest relationships suggested by the data collected in early tests of the service profit chain were those between: (1) profit and customer loyalty, (2) employee loyalty and customer loyalty, and (3) employee satisfaction and customer satisfaction.
Here's what the Service-Profit Chain looks like.

Image courtesy of The Service Profit Chain (book)

The chain begins with internal service quality, which is really about the work environment, the attitudes employees have toward one another, and how they serve their "internal customers." i.e., fellow employees. From the book: Internal quality is measured by the feelings that employees have toward their jobs, colleagues, and companies. Sounds like measuring the employee experience to me!

They provide examples of Southwest Airlines and American Express and how these two companies have linked internal service quality to profitability.

The next link in the chain is employee satisfaction, which is driven by the employee experience (aka internal service quality). It is linked to - or drives - employee retention. Southwest Airlines was again cited as an example for this linkage, as was a property and casualty insurance company (no name provided), for which they discovered that 30% of dissatisfied employees were likely to leave the company, a percentage three times higher than for satisfied employees.

Not surprisingly, the next linkage is between retention and productivity. When employee retention is an issue, companies spend time and money on recruiting, hiring, and training new employees. In addition to the financial impact, productivity is inhibited because companies basically start over with each new employee, teaching them the ropes, building new relationships with customers, and more.

Employee retention and productivity then drive external service quality. Southwest Airlines and American Express Travel Services were cited as prime examples of companies reaping the benefits of this connection. At Southwest, where we already know employee retention is high, their positions are designed so that employees can do several different jobs, if needed. That flexibility allows them to board more passengers faster than other airlines. At American Express Travel Services, productivity equates to the speed and accuracy in which tickets are prepared, showing that quality and productivity can go hand in hand.

This service quality then drives customer satisfaction. Customers are value-driven, and the book notes that value is a combination of results produced for customers and how they are delivered, i.e., not just fast and accurate but also in a professional and courteous way. As the diagram shows, customer expectations are met. The challenge is understanding what those expectations are.

Customer satisfaction links to customer loyalty, in the form of retention, repeat purchases, and advocacy. While this could be the least reliable linkage in the entire chain (for questions on that, take a look at my post on the Apostle Model), Southwest Airlines and American Express Travel Services would debate that, given their results.

When attained, customer loyalty is linked to profit and revenue growth. In their research for the book, Sasser et al took a closer look at market share and its impact on profitability. Once again looking at Southwest Airlines, at the time the seventh largest airline, they were able to conclude that the quality of market share, measured by customer loyalty, is as important as the quantity of market share. Their research at this time brought about the famous statistic we've all quoted time and time again: a 5 percentage point increase in customer loyalty could produce profit increases of 25-85% in the service industries they studied.

Here's how I interpret this chain, and it falls in line with what I preach: Put employees first. When they have a great experience, your customers will have a great experience. And so will the business. There are a lot of examples in The Service Profit Chain book of the linkages.

Still need convincing? Take a look at the book and use the examples to determine how you can do the same for your business. While the examples may not apply to every industry, I think you'll get a pretty good sense of what is required and what is possible.

Great leaders are willing to sacrifice the numbers to save the people. Poor leaders sacrifice the people to save the numbers. -Simon Sinek

Wednesday, May 1, 2019

You Aren't Journey Mapping

I hate to tell you this, but you're just not.*

I've been doing a bit of speaking lately, either about journey mapping or with journey mapping as a piece of the talk, and I've learned a lot - or, rather, confirmed a lot. Namely, you might think you're journey mapping; you call it journey mapping; but it's not really journey mapping.

Here's what happens.

I start by asking the audience if they're mapping customer journeys, and a bunch of hands in the room go up. A lot of hands, as a matter of fact.

Then I proceed to explain what journey mapping is, why you must map, how maps are used in a variety of ways, and what the journey mapping process is.

I then ask the question again. "How many of you have mapped customer journeys?" No - or very few - hands go up this second time around. What gives?

One of the things I talk about after I ask the question the first time is that, if your map has Need, Awareness, Consideration, Selection, etc. as the column headings, and within each column you've specified relevant or corresponding touchpoints or channels, then you're not journey mapping; you're mapping lifecycle stages, and you're touchpoint mapping. (This is typically where the difference in hands up is rooted.)

You see, journey maps are defined as "walking in your customer's shoes to understand her experience." That means you go step by step by step to depict the journey, to capture the customer's story of the experience, to depict the timeline of steps she took to go from Point A to Point B.

If you've got lifecycle stages and touchpoints mapped, you are not...
  • viewing things from the customer's perspective
  • capturing any kind of detail about the experience
  • able to tell where things go right or wrong
  • able to develop the corresponding service blueprint to fix what's happening inside to support the experience 
  • understanding what the customer is doing, thinking, and feeling throughout the experience
As a matter of fact, the customer isn't even in those maps.

The second likely culprit of the gap in hands between the first time I ask and the second time is that folks are creating assumptive maps, which are maps visualized by well-meaning stakeholders who believe they understand the experience; they assume they know. And when people create assumptive maps (which aren't wrong but typically aren't done right), a couple of things happen:
  • there's a lot of inside-out thinking; in other words, the map is not created from the customer's perspective
  • it's likely that they've actually created a process map
  • the map doesn't get validated with customers
  • the map gets rolled up, stashed under a desk, and goes nowhere from there
The first scenario (lifecycle/touchpoint mapping) is the one I hear most often. Neither scenario is good.

Take a look at what you're doing today or what you've done. Revisit the six steps from maps to outcomes. And then tell me if you've actually created journey maps - or something else.

... what you think is right isn't the same as knowing what is right. -E.A. Bucchianeri

*OK, some of you actually are. But just some of you.