Friday, July 31, 2009

Developing a Customer Service Strategy

I hate Continental Airlines. Hate is strong word (often reserved for HR), but I'm using it - I hate them.

I have had horrible experiences at check-in gate, at the boarding gate, on the phone reservation line. 'Did I pay for these tickets, or were they free?' I search to find a possible reason for these bad experiences. 'Have I done something wrong?'

I imagine good people work at Continental - skilled and perhaps even passionate people. I just haven't met any of them yet.

I don't really want to relive it, but I feel I can't hate without a little explanation. In short, my family (including a 2-year old and an 11-month old) was left standing at the check-in counter because, despite having boarding passes in hand, they couldn't find actual seats for us on the plane. Instead of changing diapers, getting food, and prepping for the flight, we stood, jumped and sang trying to keep the lil ones pleased - and we stressed. They finally released us to "take our chances" and off we went through security and to the gate. The gate reps told us we could board the plane but that we would all have to sit apart. I would have LOVED that, but I'm guessing the baby, the 2-year old, and those sitting next them wouldn't like it so much.

In another incident, my wife called Continental to change dates for tickets we purchased to Mexico, during what turned out to be the height of the swine flu. With two little ones we had to change our travel plans. Luckily, Continental announced a policy of permitting travel date changes at no cost during 'swine flu season.' Calling to make these changes wasn't so nice. It started calmly - we gave our names, flight info, passengers, favorite colors, bankcard passwords, everything. Then we learned of hefty change charges, different date windows than announced, and we have to deal with a mean representative. My wife was defeated, I was mad, there was yelling, and eventually I hung up on them. When I called back we started from square one. It was all a battle.

We hear a lot about customer service - the customer is always right.

This has been hitting me harder and harder recently - it's one of the most basic and important keys to business success.

Most everyone knows of Zappos customer service. Customer service reps are empowered to do what's right to make the situation better. Customers love this. Customer word of mouth is exactly how Zappos grew. Selling shoes online (at the time they started) was not a comfortable or familiar process, and customer word of mouth was the successful growth strategy.

I called Wells Fargo recently, and was given the chance to talk to a real person who patiently helped me resolve all my problems. I tweeted about my positive experience, and then someone tweeted back with a "thanks!" Wow. There is intelligent life out there, I thought. Someone is listening. The grocery delivery service FreshDirect very promptly responded to an email about a deliver that spilled. They told me to tell them what items could be credited towards my next order. These were great experiences. I tell people about them. I want to continue doing business with these people. It isn't that hard.

At our small start-up, I know I can think even more about providing the highest quality customer service with every customer interaction (internal and external). Making it a strategic issue makes a difference. Externally, I could follow up with customers about the location of an anticipated order. For internal customers, maybe it's having dinner delivered when an employee leaves work early to pick up a sick kid. I'm sure making customer service a primary strategy gets repeat customers, making customers feel like VIPs - in turn getting customers that are happy. I wonder if Continental focused just a tad on helping me use their services I paid for if I would be taking a Jet Blue flight tomorrow?

Thursday, July 23, 2009

Long term, Employee Empowerment Yeilds 10,000 Times the Return

I recently reviewed the Pursuit of Something Better. One of two powerful concepts I took from the book was this:

#1) (Relentlessly) Focusing on the employee is a valid business strategy to positively effect the bottom line.

I haven't been able to escape this idea. A friend gave me The Last Lecture book by Randy Pausch. Randy recalled a story of seeing employee empowerment in action - and it having a huge impact translatable into dollars. I'll paraphrase ...

As a twelve year old, Randy needed the perfect gift to thank his parents for allowing he and his sister to roam Disney World on their own. They identified a ceramic salt and pepper shaker for $10, featuring bears hanging from a tree, and then left gift shop. Skipping down Main Street to the next ride, Randy says the shakers shattered on the ground when they slipped from his hand.

Upon the advice an adult guest in the park, Randy and his sister took the salt and pepper shakers back to the gift shop. "It was my fault, I dropped it," Randy admitted. The employees in the store listened, and smiled ... and said it was their fault they hadn't wrapped it well enough!

Randy and his sister were high on Disney. They would return to Disney World often and talk about Disney for the rest of their lives (and here I am talking about Disney). Randy's parents' appreciation went further. In their volunteer work, they would take dozens of kids to Disney World - over a 20 year period. Spending more than $100,000.

It's a simple illustration. One that likely wouldn't impress financial analysts. But also, on the other hand, one that doesn't factor in the cost of PR or likely word of mouth sales. Oh, only if it were always so easy to see the ROI in an HR cost. Especially when it's $10 associated with empowering employees that turns into $100,000 in revenue!

Would the Disney gift shop employees be empowered today to replace the salt and pepper shakers? Are your employees empowered to do the equivalent?

Sunday, July 19, 2009

The Pursuit of Something Better Book Review

I got a hold of a book called 'The Pursuit of Something Better' and was asked for my thoughts. This is a book about company culture - so I was excited. The book focuses on US Cellular, and how CEO Jack Rooney used the concept of the 'Dynamic Organization' to transform the company and maximize business potential.

I was annoyed early on. Employees gathered for 'the highlight of the year' with 'excited anticipation' triggering 'another round of celebration.'
'The people in this room must be among the happiest, most fulfilled workers in the country'. There was 'heart' and 'soul' and 'changing inside.'

Really? This is just too much.

The book focuses on CEO Jack Rooney's creation of a 'Dynamic Organization'. I stopped looking for what the Dynamic Organization is or why it's unique - and then I started to enjoy the book more. Perhaps it's semantics or pessimism, but I felt leadership, sound business principles and discipline were being displaced by this fancy 'Dynamic Organization' phrase.

I suppose it would be more positive to focus on the great changes that did seem to happen, eventually, when Jack Rooney made changes at US Cellular. There are some real life approaches I think many of us can apply to our workplaces. Management was caring and regularly gathering info from diverse groups of employees through significant and regular surveys, focus groups, town hall meetings and email hotlines. There was a focus on training. They made paying better a priority - which I imagine initiates a higher caliber applicant and improved retention. Cancerous issues in the organization were also addressed - things like firing those who steal from the company. There was discipline, facilities upgrades, empowering staff, clearly laying out strategy and sticking to it.

Overall, I took away two strategies, both not entirely conventional, that I think can be powerfully considered in our businesses:
  • #1) (Relentlessly) Focusing on the employee is a valid business strategy to positively effect the bottom line.
Before Jack Rooney changed the focus at US Cellular, Customer Service Reps in the call centers were judged almost exclusively on how close they came to efficiency. The traditional time-on-the-call metric meant if they got rid of a caller quicker they were doing better than if they resolved the customer's issue. A better approach was seen in empowering the employee to resolve problems, paying them more, and improving the work facilities. This trickled down to the customer, made them happier, customer retention and referrals went up, and the company made more money.
  • #2.) Cultural fit is even more important than performance.
At the new US Cellular, an employee resistant to the company culture (to the values and direction of leadership) is committing a serious crime, worthy of termination. On the other hand, and employee who fits but fails to perform is forgiven (and trained). You'd do better to fall short of a goal than to reach it unethically, or by taking advantage of a customer, or by treating customers, associates or even competitors with disrespect.

I think many of us do this already. We know the importance of cultural fit. We have different members of our team interview new hires. But do we make cultural fit a primary strategy? Are we willing to fire top performers if they don't fit the culture and values?

We can call all this a 'Dynamic Organization' but it isn't a secret program or puzzle to deconstruct. It's sound business. A lot of the successfully strategies, like empowering call center workers to please the customer, and prizing fit, reminds me of what Zappos does so well.

Metrics might not have that direct connection to the bottom line we so often like, such as sales per associate, or cost of benefit per employee. Perhaps the best recipe is a bit more indirect. Maybe leading indicators can be more about measuring and driving to keep employees thrilled, or to act ethically, or to reward the right attitudes?

In the end, authors Dave Esler and Myra Kruger left me thinking about some valuable ideas in The Pursuit of Something Better. Among them, do you have the right metrics in place? Can doing the right thing bring you financial success? Are you willing to stick to your guns when your plan is unpopular?

Monday, July 13, 2009

Turnover vs. Performance Management

Just about everyone at one time or the other recommends turnover as one of HR's most valuable metrics. This is something I've looked at in many different ways, but coming from a small start up I just don't know if its valuable at all.

I'm reading a book now, called 'The Pursuit of Something Better' (more to come). In several cases, employees were 'forced into early retirement' or otherwise encouraged to resign because it wasn't working out.

Haven't most of us seen this in one way or the other? An employee resigns because they get feedback their performance is sub-par or they get a less than desirable pay increase. Maybe they are told more frankly to leave or get fired. These cases skew what we assume when we see turnover rate.

I know the ways we calculate turnover can vary and can be valuable in some cases, but for me and for right now it doesn't seem to offer value.

Friday, July 3, 2009

SpringStage - Up With Entrepreneurial Resources

Doing some reading before my last post, I learned of a great new community for start ups called Spring Stage. Launched earlier this year, founders David Cohen and Alexander Muse are building a network and 'a visible resource' to be in tune with the local entrepreneurship and start up scene.

Very cool. Entrepreneurs need more resources.

I thought about applying to be part of the community, but I can't help but think New York is entrepreneur saturated. We are blessed with the NYC Tech Meetup community (with over 10,000 members) and loads of other entrepreneurial networking and showcase groups and events - something just about every night.