Focus on the Fundamentals
Nov 12, 2014
Focus on the Fundamentals
During the past 21 years…
CEO of two large companies
Owned four small businesses
Read a minimum of 100 business books a year,
every single year!
For the past 16 years…
What does this mean to me?
How can I use this idea?
What can I do right away?
The Four – I’s
• Ignorance
• Inflexibility
• Indifference
• Inconsistency
How to avoid the Four I’s
• Aggressive external market focus.• Aggressive customer focus.
• Keep the “Main Things” the main things.• Bullish on knowledge sharing and learning.• Passion and commitment at all levels.• Foster a healthy paranoia.• Revel in change.
– be agile, adaptive, and anticipatory.
T + C x ECF = Success
Anne MulcahyCEO of Xerox and the third most powerful woman in the world!
1. Build a network of great relationships with people who want to see you succeed.
2. You don’t have all of the answers, so ask for help and advice from the smartest people you can find.
3. Learn to be a learner.
4. Listen intently to your employees and to your customers.
Some really great advice…
What does it take to be a valued member of a team?
Develops and display competence.
Follows through on commitments.
Delivers required results.
100% integrity / honesty.
Enjoyable to work with – positive attitude.
Passionate about their work and those they serve.
Communicates and keeps everyone informed.
Helps the other members of the team.
Is proactive – looks for responsibility.
Creative and innovative.
Share ideas, information and credit.
Hold themselves 100% accountable.
Team Leaders are:Rigorous… but not ruthless
• Lack of TRUST• Lack of candor• Lack of commitment• Lack of accountability• Lack of results
Competence
RespectDistrust
Affection TRUST
HIGH
LOW
LOW HIGH
Concern
The 4 C’s of Trust
John Spence High-Performance Team Model
• D• M• C• C• M• D
irection – vivid, clear, inspiring --- shared
easurements – specific, observable, focused
ompetence – very good at what they do
ommunication – open, honest, courageous
utual Accountability – all team members
iscipline – do this every day
4-Level Decision Making
1. You own it.
2. Ask for input… you own it.
3. Team decision… I own it.
4. My call… I own it.
Empowerment + Accountability
The 4 Pieces of Paper
11 Key Team Competencies:
1. Setting clear, specific and measurable goals.
2. Making assignments extremely clear and ensuring required competence.
3. Using effective decision making processes within the team.
4. Establishing accountability for high performance across the entire team.
5. Running effective team meetings.
6. Building strong levels of trust.
7. Establishing open, honest and frank communications.
8. Managing conflict effectively.
9. Creating mutual respect and collaboration.
10. Encouraging risk-taking and innovation.
11. Engaging in ongoing team building activities.
1 - 10
T + C x ECF = Success
74%23,000,000
88%
What they look for in a leader…
Credibility
1.Honest2.Forward-looking3.Competent4.Inspiring
The key elements of a winning culture: Employees
• Fun• Family• Friends• Fair• Freedom• Pride• Praise• Meaning• Accomplishment
• Ownership Mentality• Sense of Urgency• Disciplined Execution• Accountability• Continuous Innovation• Customer Focus
The key elements of a winning culture: Company
T + C x ECF = Success
A few good quotes…
• “We are not in the coffee business serving people… we are in the people business serving coffee.” Howard Schultz, CEO – Starbucks
• “We took our eye off the ball and it damn near put us out of business. We forgot that the customer pays ALL the bills. We are here to serve them, help them, support them. Not keeping that at the front of our minds almost cost us everything.” Lou Gerstner, CEO - IBM
• “The very future of our company hinges on our ability to understand and serve our customers better than any other firm. It is all about customer service, the products are actually secondary.” Jeff Immelt, CEO – GE
• “The only critic whose opinion counts, is the customer” – Mark Twain
Let’s look at your market: The bad news…
• Strong competition
• Difficult to differentiate
• Highly informed consumers
• Exceedingly high expectations
• Cost of acquisition of a targeted customer is high
• Cost to satisfy is higher
• Cost to replace is 5x higher
Good News: Value of a delighted customer… priceless!
Customer Satisfaction drives Customer Loyalty… and Customer Loyalty drives Profitability
100%
90
80
70
60
50
40
30
20
Extremely Dissatisfie
d
SomewhatDissatisfie
d
SlightlyDissatisfie
dSatisfied
Very Satisfied
Zone of Defection
Zone of Indifferenc
e
Zone of Affection
Loyalt
y
Customer Satisfaction
Terrorist
Evangelist
A 5% increase in loyalty among your best customers…
Can produce a profit increase of 25% – 85%I hate you
I don’t care about you
I love you
Key Drivers of Customer LoyaltyFinancial
Performance
Quality P&S&
Customer Relationship
EmployeeSatisfaction
Empowerment High Standards
Long-termOrientation
Enthusiasm, Commitment,
Respect
Training &Development
Fair Compensatio
n
CR=104.12
CR= .404
CR=.334
CR=.277
CR=.275CR=.249
CR=.280 Coaching
CR=.285
CR=.371
CR=.365
CR=.191
CR=.247
TolerateNothing
Less
From: Practice What You Preach by Maister
Global study:16 countries29 companies139 offices5,589 respondents
The Five Levels of Customer Service
I don’t really care
Why try harder
Good enough is good enough
That’s nice
Wow – you guys are awesome
To have an effective Customer Relations program, these three statements MUST be true for your organization:
1. Customer satisfaction is a philosophy and a commitment by
top management.
2. Customer satisfaction is an attitude and atmosphere that
prevails throughout the entire organization.
3. Customer satisfaction is a program of ACTION within the
organization.
1 -10
Fundamental Customer Expectations
• Reliability: The ability to provide what was promised, on time, dependably and accurately. (Honesty)
• Assurance: The knowledge and courtesy of employees, and their ability to convey trust and confidence. (Competence)
• Empathy: The degree of caring and individual attention provided to customers. (Concern)
• Responsiveness: The willingness to help customers and provide prompt service. (Attitude)
• Tangibles: The physical facilities, equipment, and appearance of the personnel. (Professionalism)
1 -10
How do the Best Companies Deliver Superior Customer Service?
• From a study of more than 3,000 companies — narrowed down to the top 101 companies that profit from customer care — here are the top five factors that were the fundament tactics used to build and manage extraordinary levels of customer satisfaction and loyalty.
1 -10
They listen to, understand, and respond (often in unique and creative ways) to the evolving needs and constantly shifting expectations of their customers. (VOC)
Extreme Customer Focus
They establish a clear vision of what superior service is, communicate that vision to employees at all levels, and ensure that service quality is personally and positively important to everyone in the organization..
Shared Customer Service Credo
They establish concrete standards of service quality and regularly measure themselves against those standards, guarding against the “acceptable error” mindset by establishing as their goal 100% customer satisfaction performance.
Clear Standards + Accountability
Create A Dashboard of Key Indicators
MPS Margin Per Sale
Talent Level
Service Level
They hire the best people, train them carefully and extensively so they have the knowledge and skills to achieve the service standards, then empower them to work on behalf of the customers, whether inside or outside the organization.
Customer Focused Employees
They recognize and reward service accomplishments, sometimes individually, sometimes as a group effort, in particular celebrating the success of employees who go “one step beyond” for their customers.
Deal decisively with mediocrity
Reward and Celebrate Success…
Understanding the Customer-driven Company
• Create a customer-focused Vision• Flood the organization with VOC• Become an expert on delivering
superior customer service• Turn your employees into customer
service champions• Destroy any barriers to superior
service performance• Measure, measure, measure• Walk the talk
Focus on the Fundamentals: SUMMARY
• Customer service is the only defendable differentiator.• Only engaged and satisfied employees deliver can
deliver consistently superior customer service.• Consistently superior customer service can lead to as
much as a 104% increase in profits.• The success of your business is directly tied to the quality
of your people.• Demand excellence – refuse to tolerate mediocrity.• Teamwork is mandatory – not optional.• Culture counts.
THANK YOU
If you have any questions at all please do not hesitate to send a note or call. My email address is: [email protected]
Also, you might find value in the ideas I share in my blog. You can sign up for it at:www.johnspence.com/blog