Monday, March 28, 2016

What's Happened to Customer Service?


Understanding your customers is becoming a complex task for most organisations in the 21st Century; not just because market segments have become a highly complex multi-dimensional matrix of customer types – but because most organisations no longer see customer service as a primary factor in organizational growth – more as a minimalistic requirement in their quest for profit maximization.
 
This approach to customer service has been developing since the 1980’s – when organisations started to take advantage of ‘customer loyalty’ built up since the end of the Second World War. Once an organization has a loyal customer base – it’s easy to see how some high ranking individual with dollar signs in their eyes – could see this group of people as easy prey for making a quick buck – and hence the slide in customer service began.
 
Of course the customers partly encouraged this behavior because, even when they suspected the world might have changed and that they were now being fleeced for their money, they still kept loyal to the brand. Some customers might send letters to the CEO expressing their dissatisfaction – but as long as they received some potentially believable apology, they would quickly forgive and continue their loyalty – because for years prior to this they had received great service and quality, so how could this have changed.
 
Customers just didn’t see the complete change in business and the associated ethics and didn’t realize that the quest for long term sustainable success and growth through dedicated customer care was a business school theory rarely practiced in the ‘new world.’
 
Generationally this had a huge impact on differing customer views to purchasing and the concept of loyalty. The young generation – not used to doing deals on a hand-shake and the concept of customer loyalty – entered the world of consumption like a duck to water, not expecting good customer service and quality products, and just looking for the best deal. They knew how to use ‘new’ technology to find that best deal and simply felt this was how business is done, and how it should be done.
 
The slightly older generations – those now in their 50’s and above – still remember a time when being someone’s customer actually meant something and hence many of these customers still long for those good old days – and in a way, with today’s seemingly constant market volatility – so should today’s organisations.
 
Customers are your business – they define your growth, your profitability and your sustainability – everything else is developed around them. This current short term view to business – brought about in no small measure by greedy shareholders has not helped anybody – and definitely not the average shareholder, looking to make money over the long-term not the short. In fact the only people this new approach to treating customers has helped is the institutional investors who don’t give a damn about anything more than making more money today than they did yesterday – regardless of whose expense that comes at. It’s not that they just don’t care about organisations, they don’t care about their employees or their customers – they just care about making an extra buck – whatever the cost of that buck might be to ‘normal people’ through their long term savings or pension schemes.
 
In this global business environment what today’s organisations need, as well as the countries they service in terms of taxes and employment, is sustainability (it doesn’t even need to be sustainable growth). To have sustainability you do have to have the right product at the right price, and to be innovative in your offerings, in terms of future needs – but what you should also want is a loyal, ‘sustainable’ customer, who will stay with you on your journey and during that journey help attract new customers to your products and brand – offering a win-win for everyone involved in the business process.
 
Michael Porter wrote about competitive advantage in his book of the same name – but few organisations consider competitive advantage any more when it comes to their strategic thinking around customers and customer service. Maybe it’s the fault of their boards or their advisors, but industries with high churn rates, like telecoms, energy and even gym membership – seem to be significantly more focused on short-term profit maximization that long term sustainability – much more than creating that elusive concept loyal customer in the 21st Century.
 
Organisations through their CRM strategies have turned today’s customers into what they are – it’s not the customers fault – they are what business have made them to be.

Sunday, February 7, 2016

What's Wrong With Leadership Today?


As years roll into decades the image of leadership seems to be sadly going downhill fast. While there is an increase in firms and individuals offering leadership development solutions, the world as a whole seems to lack the face of even one inspirational leader. Which makes one wonder what current leadership development is focusing on and why it isn’t having any impact – at least noticeable impact.
 
There are excellent inspirational leaders out there – I have the pleasure to meet more than my fair share; as will many reading this – but these leaders aren’t becoming visible to make a real difference where it counts; which is way beyond the walls of their own organisations.
 
As much as we’d like to think business and politics are miles apart – sadly in today’s world the umbilical cord between the two has not been cut; with most politicians and their respected parties around the world being financed through big corporate donors.  Where for some strange reason politics has simply become entertainment – where, for example, the media parade future leaders out in front of the public and either attempt to humiliate them; or the candidates seem to have a natural instinct to humiliate themselves.
 
If our current and future world leaders are being portrayed as a ‘form’ of entertainment – what ‘inspirational’ impact can this have on the millions around the world watching – wanting to be inspired to be better, but being ‘taught’ sets of values that have absolutely no place in an effective leaders repertoire. This must lead to complete confusion in the emerging leaders mind – reading what leadership is about from the millions of related articles; and hearing what leadership is about from an abundance of courses; and then comparing these ‘stories’ with seeing today’s leaders in action. What are they more likely to believe and react to – what they read or what they see in action?
 
In a brilliant 2016 Harvard Business Review article by Jack Zenger and Joseph Falkman entitled ‘the trickle-down effect of good (and bad) leadership’ they highlight how “we know that emotions are contagious. Research by UC San Diego’s James Fowler and Harvard’s Nicholas Christakis has shown that happiness is contagious, for example. If you have a friend who is happy, the probability that you will be happier rises by 25%. We also know that behaviours are contagious. Christakis and Fowler determined that if you have overweight friends, you’re more likely to be overweight yourself. If you quit smoking, your friends are more likely to quit. Rose McDermott of Brown University found that divorce is contagious; etc.
 
We wanted to know how such ‘social contagion’ affects leaders. We already know that good leadership creates engaged employees and that leaders influence a variety of outcomes such as personnel turnover, customer satisfaction, sales, revenue, productivity, and so on. But if you’re a good leader, do you make the people around you more likely to become good leaders as well? And which behaviors are most readily ‘caught’?”
 
So we should be aware that today’s bad leaders and the portrayal of bad leadership behavior is simply creating future generations of poor leaders; and worse still poor leaders who actually think they are good – and will be able to pull out of the archives video clips of supposed top leaders behaving in the same way they do.
 
The media seem to assume that the population of future leaders can see through the entertainment aspect of their portrayal of effective leadership – but that is a bridge too far in their thinking and the fundamental flaw in their theory.
 
Zenger and Falkman highlight how “specifically, we tested 51 behaviours and found significant correlations in over 30 of them. (All 51 showed some correlation, but not all the correlations were statistically significant.) Within the behaviours that appeared contagious, there were some that appeared even more contagious than others. Behaviours that had the highest correlations between managers and their direct reports clustered around the following themes, listed in order of most contagious to least contagious:
 
1) Developing self and others
2) Technical skills
3) Strategy skills
4) Consideration and cooperation
5) Integrity and honesty
6) Global perspective
7) Decisiveness
8) Results focus
 
We also examined overall performance. Unsurprisingly, the direct reports of the worst-performing HL (high level) managers were also below-average performers.”
 
It’s worth looking at the list one more time, slowly, and then visualizing the impact both positive and negative influencers would have on each of these behaviors and how this would manifest itself in the work place and in future leadership development.
 
As the world waits for the inspirational leaders to show themselves; we also have a responsibility to not just talk about effective leadership; but enact it on a daily basis as well – and that’s in all our interactions, including social media as well.
 
It’s worth concluding with a 2014 report from the Center for Creative Leadership, which stated that “more complex and adaptive thinking abilities are needed” and “leaders are no longer developing fast enough or in the right ways to match the new environment.”
 
References:
 
Zenger, J. and Falkman, J. (2016). The Trickle-Down Effect of Good (and Bad) Leadership. Harvard Business Review. January.
 

Sunday, January 3, 2016

A Year in Review: 2015


2015 will have been a tough year for many – where although the economic crisis was supposed to be over and figures showed unemployment declining in many first world countries – millions of people still struggled to live from week to week.
 
In the UK, according to the Payments Council, 2015 was the year cashless payments overtook the use of notes and coins for the first time. Cash accounted for only 48% of all transactions, as we used our credit cards, contactless cards and electronic transfers for the majority of our spending.
 
In 2015 69 journalists lost their lives in the line of duty, according to the Committee to Protect Journalists (CPJ). Some 28 of those - 40% - were killed by Islamic extremists, said the CPJ. The death toll, which includes journalists killed between 1 January and 23 December 2015, is higher than the 61 journalists killed in 2014.
 
And 2015 was a very busy year indeed for the tech industry. Its highlights have included a series of mega-launches, including the well-received Windows 10, the curved Galaxy S6 smartphone, the Apple Watch and a Tesla car with doors that opened upwards.
 
Meanwhile, amongst the lowlights were hack attacks of the Ashley Madison infidelity service, the toymaker Vtech and the US government's Office of Personnel Management. The Kickstarter-funded Zano mini-drone project also collapsed, Lenovo infected its laptops with spyware, and a security researcher was banned from flights after he tweeted he might be able to hack them.
 
The online giants were also busy: Jack Dorsey took back control of Twitter; Google faced anti-competition allegations from the EU; and Facebook was threatened with having its data transfers blocked between the EU and the US.
 
On 7 January, two gunmen, Said and Cherif Kouachi, attack the Paris offices of the French satirical magazine Charlie Hebdo, wounding 11 and killing 12. The gunmen attack Charlie Hebdo in order to punish the magazine for the publication of cartoons that mocked the Prophet Mohammad. Later on January 9, the Kouachi brothers are shot and killed in a standoff with police in Dammartin-en-Goele, France.
 
In February Samsung raised more than a few eyebrows when documentation for its smart TVs warned owners that they might transmit ‘personal or other sensitive information’ spoken in front of them to an unnamed ‘third party’. Unsurprisingly, many found the idea of the TVs spying on their private conversations more than a little unnerving.
 
On 24 March Germanwings Flight 9525 crashes into the French Alps after taking off from Barcelona, Spain, en route to Dusseldorf, Germany. All 150 people on board are killed. On March 26, 2015, officials say that 27-year-old co-pilot Andreas Lubitz deliberately crashed the plane after locking the pilot out of the cockpit. A later investigation reveals that he had suffered from depression in the past.
 
In April, American Airlines efforts to make its cockpits ‘paperless’, briefly backfired when the app providing its pilots with maps and other flight information refused to work. Dozens of the firm's jets were grounded until the developers of FliteDeck came up with a fix.
 
On 2 May the Duchess of Cambridge gave birth to her second child with Prince William. Their daughter, weighing 8lbs 3oz, will be known as Her Royal Highness Princess Charlotte Elizabeth Diana.
 
In June, Facebook was criticised by a UK-based child protection charity after its moderators refused to remove a video showing a crying baby being repeatedly dunked in a bucket of water. There were suggestions that the footage showed a form of ‘baby yoga’. But the charity said the child was terrified and sobbing, and that the actions amounted to child abuse. The case highlighted a clash of cultures between the social network, which wants to allow its users to post and comment about potentially distressing content, and those who think it has a responsibility to censor extreme examples.
 
On 14 July a deal was reached to substantially limit Iran's nuclear weapons program. In exchange, various international sanctions on Iran will be loosened and on 20 July Cuba and the United States officially re-establish diplomatic relations after 54 years.
 
In August, Ashley Madison was fighting for its very existence after a data dump exposed details of more than 33 million of its users' accounts. The hack caused the firm's founder to resign, but also had ramifications that reached far beyond the Canadian firm's offices. News that police believed the leak had resulted in at least two suicides was the most read story on the UK BBC's Tech section and highlighted the devastation the security breach had had on people's lives. Blackmailers continue to try to exploit the hack - whose perpetrator has never been caught - with a recent report of letters being posted to Ashley Madison users threatening to expose their identities.
 
On 18 September U.S. regulators said that Volkswagen has programmed some 500,000 vehicles to emit lower levels of harmful emissions in official tests than on the roads. Volkswagen later reveals that internal investigations had found significant discrepancies in 11 million vehicles worldwide.
 
On 23 October, Hurricane Patricia, the most powerful hurricane ever recorded, made landfall as a Category 5 storm over southwestern Mexico.
 
In November, an Estonian start-up announced that it had been able to use LED light bulbs to transmit data at speeds of one gigabits per second. What made this significant was that the tech firm had got it working in a normal office, where it provided both light and internet access to staff. In time, engineers believe they can boost speeds up to 224Gbps.
 
On 12 December a landmark climate change agreement is approved in Paris at the 21st Conference of Parties, or COP21.
 
Finally the rise of Donald Trump is the most obvious shocking political story of the year. After speculating multiple times that he would run for president in previous cycles, few people thought he would jump in the race and that he was only trying promote his television show ‘The Apprentice’. When he actually announced from the Trump Towers in New York, most thought he would drop out before he had to disclose reams of details about his wealth in required financial disclosure statements for presidential candidates. Instead, Trump continues to lead the GOP field in most national and state polls heading into what promises to be a 2016 campaign year filled with even more surprises – a sad reflection on what the world’s has become.
 
Finally in remembrance to some of those who passed away during 2015;
 
27 February: Leonard Nimoy. After revealing last year that he had been suffering from a chronic lung disease, he signed off with a final tweet that ended ‘LLAP’, Mr Spock’s famous catchphrase, ‘live long and prosper’. He died at the age of 83.
 
12 March: Terry Pratchett, was one of Britain’s most successful authors of all time, adored by fans of his fantasy and comic writing – most notably his Discworld series. A prolific writer – the Discworld series alone consisted of 41 books –Pratchett sold more than 80 million copies worldwide. In 2007, Pratchett revealed that he had been diagnosed with a rare form of early-onset Alzheimer’s – which he called ‘the Embuggerance’. He funded and wrote about dementia research in the following years, before his death aged 66.
 
13 April: Günter Grass, a writer, artist and public intellectual; and was Germany’s best-known post-war novelist and won the Nobel Prize in literature in 1999. Grass was an outspoken social critic whose books encouraged Germany to examine its collective conscience following World War Two. In 2006, Grass revealed – to much controversy – that he had been a member of the Waffen-SS as a young man. He died at the age of 87.
 
2 May: Ruth Rendell was one of Britain’s most successful crime writers. She introduced the much-loved character of Inspector Wexford in her 1964 debut and went on to write over 50 crime novels in her own name; she later wrote darker, psychological fiction as Barbara Vine. She was called – along with her friend PD James, a ‘British queen of crime’ – a moniker she hated. She died aged 85.
 
14 May: BB King; known as the ‘King of the Blues’ was born in Mississippi and began performing in the 1940s. King was a great influence on later generations of guitar players: Rolling Stone magazine rated him third in their 100 greatest guitarists of all time. He carried on performing around 100 concerts a year until shortly before his death aged 89.
 
7 June: Christopher Lee was born in 1922 in Belgravia, London. At the outbreak of World War Two he volunteered for the Finnish army, then joined the RAF. In his first film, The Curse of Frankenstein, he starred with Peter Cushing; the pair became friends and starred together in 20 films. Lee became synonymous with Hammer, and especially Dracula, who he played for the first time in 1958. Roles in The Wicker Man, as Saruman in The Lord of the Rings trilogy, several Tim Burton collaborations and as Count Dooku in Star Wars episodes II and III introduced him to later generations. He died aged 93.
 
10 July: Omar Sharif, born in Egypt, became a star in his home country before achieving international recognition for the part of Sherif Ali in David Lean’s 1962 epic Lawrence of Arabia, a role for which he won a Golden Globe and an Oscar nomination. He went on to star in Lean’s Doctor Zhivago alongside Julie Christie and in Funny Girl opposite Barbra Streisand. Off-screen, he became a world-renowned bridge player and remained a loyal – if surprising – supporter of Hull City Football Club. Sharif had been suffering from Alzheimer’s and died of a heart attack aged of 83.
 
15 November: Saeed Jaffrey was born in the Punjab in 1929. He began his career in the theatre, being the first Indian actor to tour Shakespeare in the US. He broke into the Indian film industry in Satyajit Ray’s Shatranj ke Khiladi (The Chess Players) in 1977, and went on to star in more than 100 Bollywood films. He became well-known in Britain after appearing in several acclaimed films, including The Man Who Would be King, My Beautiful Launderette, Gandhi and A Passage to India. He died aged 86.
 
Finally, it was a last woof for Uggie, the Jack Russell terrier, who appeared in the Oscar-winning silent movie "The Artist" and was the first canine to have his paw prints cemented outside of Grauman's Chinese Theatre in Hollywood.

 

 

 

Sunday, December 6, 2015

Are Organisations Good at Learning?


Francesca Gino and Bradley Staats highlight how “our traditional obsessions – success, taking action, fitting in, and relying on experts actually undermine continuous improvement. Virtually all leaders believe that to stay competitive, their enterprises must learn and improve every day. But even companies revered for their dedication to continuous learning find it difficult to always practice what they preach. Consider Toyota: Continuous improvement is one of the pillars of its famed business philosophy. After serious problems in late 2009 led Toyota to recall more than 9 million vehicles worldwide, its leaders confessed that their quest to become the world’s largest automobile producer had compromised their devotion to learning,” (p.111-112).
 
If one looks at the media these days when they report on business, everything is short term – they aren’t interested in organisations that have a long term view, they only seem to be interested in reporting “success” now. This in itself has undermined how many organisations view real success, and how too often organisations ‘sing’ to the tune of the press, terrified of even the slightest hint of failure. But if we look back on our lives, how much did we learn growing up through the mistakes we made. In fact wasn’t that some of the fun of our youth – to experiment as a way to learn, where success or failure was a positive experience to learn something from? We’re not talking about the irresponsibility of youth – but of that pioneering spirit that lives within us all.
 
To support this thought Gino and Staats (p.112-113) ask “why do companies struggle to become or remain ‘learning organisations? Through research conducted over the past decade across a wide range of industries, we have drawn this conclusion: Biases cause people to focus too much on success, take action too quickly, try too hard to fit in, and depend too much on experts. Leaders across organisations may say that learning comes from failure, but their actions show a preoccupation with success. This focus is not surprising, but it is often excessive and impedes learning by raising four challenges;
 
Challenge #1: Fear of Failure. Where organisations don’t develop new capabilities or take appropriate risks, unless managers tolerate failure and insist that it be openly discussed.
 
Challenge #2: A Fixed Mindset. People who have a fixed mindset aim to appear smart at all costs and see failure as something to be avoided, fearing it will make them seem incompetent.
 
Challenge #3: Overreliance on Past Performance: When making hiring and promotion decisions, leaders often put too much emphasis on performance and not enough on potential to learn.
 
Challenge #4: The Attribution Bias: It is common for people to ascribe their success to hard work, brilliance, and skill rather than luck; however, they blame their failure on bad fortune. This phenomenon, known as the attribution bias, hinders learning.
 
Yet the years have not been kind to risk taking and the pioneering spirit and in today’s so called modern world the fear of failure is often learnt long before one starts a career in business and in a sense goes against the inquisitive nature of us human beings. Not that long ago, the men and women who pioneered so many incredible inventions and discoveries, actually embraced failure. We know the story of Edison and the invention of the light bulb – and just how many attempts it took him to find the right solution. Yet one has to wonder if Edison would ever had invented the light bulb in today’s unforgiving business environment? But the fact that one might have to think just for a moment as to whether Edison would have survived in today’s ‘success only’ business environment should be cause for concern.
 
But is it really external factors, like the media, that defines an organisations cultural approach to failure or is it how their leaders respond to the external environment and how much they believe that they control their organisations destiny and decide to embrace failure as part of their positive culture – rising above even their ego’s.  
 
Gino and Staats give this example; “consider professional soccer goalkeepers and their strategies for defending against penalty kicks. According to a study by Michael bar-Eli and colleagues, those goalkeepers who stay in the centre of the goal, rather than diving to the left or the right, actually perform the best: They have a 33.3% chance of stopping the ball. Nonetheless, goalkeepers stay in the centre only 6.3% of the time. Why? Because it looks and feels better to have missed the ball by diving, even if it turns out to be the wrong direction, than to have stood still and watched the ball sail by,” (p.114).
 
We live in a world where, sadly, there are too many people just waiting for business organizations to make a mistake – it’s a quick easy story – but this vulture like approach to failure is probably having a major detrimental impact on the true potential progress of too many organisations around the globe. Organisations that are spending too much time and effort worried about failure – when it’s failures that will actually take them to the next level.
 
Gino and Staats conclude by stating that “it may be cheaper and easier in the short run to ignore failures, schedule work so that there’s no time for reflection, require compliance with organizational norms, and turn to experts for quick solutions. But these short-term approaches will limit the organisations ability to learn. If leaders institute ways to counter the four biases we have identified, they will unleash the power of learning throughout their operations. Only then will their companies truly improve continuously, p.118
 
References:
 
Gino, F. and Staats, B. (2015). Why Organizations Don’t Learn. Harvard Business Review. November, p.110-118.