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Reprise: Training Will Not Eliminate Racist Behavior in Starbucks

In a letter that Howard Schultz, Executive Chairman of Starbucks, published in today's New York Times, he describes what his stores and offices will be doing this afternoon to address the problem of racial bias in the company:  

More than 175,000 Starbucks partners (that's what we call our employees) will be sharing life experiences, hearing from others, listening to experts, reflecting on the realities of bias in our society and talking about how all of us create public spaces where everyone feels like they belong - because they do. This conversation will continue at our company and become part of how we train all of our partners.

Again, I commend Starbucks for attacking the problem but I continue to have my doubts about the long term effects of their approach. On April 19, 2018, I wrote about these concerns. That blog post is repeated here:

 

In response to a racially charged incident at a Starbucks in Philadelphia that resulted in the unnecessary Clem-onojeghuo-228522-unsplash arrests of two black males waiting for a friend, the company has announced that it will “…close more than 8,000 of its stores on May 29 to conduct anti-racial bias training for nearly 175,000 employees.”

While this response is commendable, if that’s all Starbucks does to eliminate racism among its staff, it will be a significant waste of time, money, and effort. I understand, putting all of their employees through training is good optics for the company and might provide some protection from lawsuits. But change in the culture requires so much more.

In the wake of the Starbucks incident, The New York Times asks the question, “Can Training Eliminate Biases?” The answer is “no”. Diversity and inclusion in companies is not achieved through a workshop. That’s not how people change behavior. Only culture change can eliminate biases. Training might be a good first step in raising awareness for some, but attitudes and actions must be supported consistently by the entire organization over time. Diversity and inclusion must be rooted in the processes and life of the organization.

As I wrote in a blog post on May 31, 2008 titled, From Diversity to Inclusion and Engagement:

Third Sector New England has, from its nearly five decades of experience, identified the following as key drivers of successful diversity initiatives:

  • A diversity committee/task force, representing all levels of the organization, that regularly communicates with the entire organization
  • Unflinching commitment by the CEO to convey the benefits of organizational diversity to the organization’s mission, vision and values
  • An organization-wide assessment or cultural audit to determine major challenges and barriers
  • Prioritizing those challenges
  • A clear designation of key participants, action steps and timelines to address challenges
  • Skill-building for moving beyond differences to develop an organizational language and culture of inclusiveness
  • Alignment of diversity planning with the organization’s strategic plan, so the former includes an assessment of funding and other resources needed to support the effort
  • A consultant to facilitate developing and implementing a diversity plan
  • Evaluation of progress at regular intervals
  • Reassessment of priorities as needed

In addition to these elements of comprehensive planning, an organizataion has to make some fundamental changes in how it works. Employees need to hear their senior managers talking frequently about diversity and inclusion. It’s not enough that the value of diversity and inclusion is listed on a laminated poster in the employee lounge. This value must be visible in the day-to-day actions of the company. Employees must see diversity in hiring and promotions, as well as among Board members and executives. The ability to accept differences must be in the criteria for hiring. Employees must see evidence that their company partners only with other companies that make a sincere effort at improving diversity and inclusion and eliminating racism. Managers need to step up and take responsibility for creating a welcoming and supportive culture in every part of the organization.  

Managers must recognize that not everyone has the same receptivity to change and act accordingly. Amber Madison has identified four archetypes of diversity and inclusion: the champion; the newbie; the bigot; and the bystander. She suggests that managers address each type differently. I recommend hiring "champions" and "newbies" and avoiding hiring "bigots" and "bystanders" as much as possible.

As we argue in our new book, Minds at Work: Managing for Success in the Knowledge Economy, managers must help to develop the people around them. And this means eliminating the discrimination that contributes to a hostile work environment. Racism is bad enough, but if there is racism, then there is sexism and antisemitism and antimuslimism and every other kind of discrimination. In addition to the immorality of that kind of workplace, that environment is not conducive to learning and people doing their best work, whether you’re a barista in a store or CEO of the company.

In fairness to Starbucks, a company that I admire, let me say that they are facing the same kind of racism that all companies face and is ingrained in our society. With over 27,000 locations worldwide, it's surprising more incidences of racial bias haven't been reported. But that's not an excuse and the company must do more to ensure that diversity and inclusion permeate its culture. However, training is not the answer.

Photo by Clem Onojeghuo on Unsplash

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The Changing World of Work

Microsoft and PopTech have created an eight part video series that describes how the world of work is changing, in both the company workplace and the global workplace.

[youtube https://www.youtube.com/watch?v=95o-jz50AaQ] 

The videos present these eight core themes:

  1. Digital technology and an abundance of information are causing profound changes in the way people work.
  2. To be competitive, companies are shifting from a focus on “efficiency of process” to a focus on “effectiveness of outcomes.”
  3. Companies are being more responsive to the decision-making and information needs of employees.
  4. Employees are more interconnected and, therefore, more interested in a collective response to business issues.
  5. Leaders are developing adaptive organizations that depend on collaboration and trust.
  6. Human contact matters; therefore, workplaces are being designed to increase collaboration.
  7. Workplaces are being designed to accommodate a wide variety of spaces that fit the range of workers’ needs.
  8. Automation is eliminating jobs but also providing an opportunity to create new, more creative jobs.

The 23 notable speakers in this video series emphasize that continuous learning must be a part of this new workplace that is local and global. They say that we don’t know what tomorrow will bring so we need to continually learn how to adapt to whatever comes at us and whatever we seek to change. And given this rapid transformation and increasingly networked world, adaptability is key.  Stanley McChrystal says it this way:

…when you combine the two, speed and interconnectedness, suddenly you have this unpredictability, so you don’t know what tomorrow will be like, you don’t know what next week, and you certainly don’t know next year is like…so you’ve got to have adaptability to respond to changing conditions so organically, it has to be in the DNA of the organization so that it doesn’t have to come from top down directives that says, “now we are going to produce a new version of this”. Instead, it allows the organization to learn, adjust, and adapt automatically. 

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50 Ways to Lever Learning

(My apologies to Paul Simon.)

In a learning culture, formal training is just one of many methods used to facilitate employee learning. In a learning culture, we start with the performance goal and then select the mix of methods that will help employees acquire and retain the knowledge, skills, attitudes, and beliefs they need in order to achieve those goals. This is a list of 50 of those methods. The first 25 are primarily instructor-directed; the second 25 are primarily learner-directed.

  1. Instructor-centered class (fact to face) – traditional classroom in which instructor controls the content and learning Classroom trainingprocess
  2. Instructor-centered class (virtual) – similar to classroom except instructor delivers instruction via the Web and class can be synchronous or asynchronous
  3. Instructor-facilitated seminar – meeting convened by an instructor; learners discuss a topic relevant to their work and chosen by instructor
  4. Instructor-facilitated workshop – meeting convened by an instructor; participants learn from experience of working together on solving a problem or creating something new
  5. eLearning  – content delivered to learner via computer; usually desktop computer
  6. Mobile learning – a form of elearning that is accessed by a mobile device such as smart phone or tablet; can be anywhere, anytime
  7. Coaching – a relationship in which a trained coach helps an employee develop the knowledge and skills to be a more effective manager by addressing real situations that manager faces in workplace
  8. Mentoring – a relationship in which senior leaders impart their knowledge and wisdom on employees who are learning to be leaders
  9. Learning alliance – a relationship between managers and their direct reports that focuses on employee learning and how managers can support that learning
  10. Game –engaging employees in learning by applying principles of gaming (scoring, competition, rules of play, etc.) to create an experience that is interactive and fun
  11. Simulation – replicating real-life problem solving within a safe environment; for example, learning business acumen by working with a team to solve a typical business problem and receiving immediate feedback on their performance
  12. On-campus college courses – attending for-credit courses or non-credit courses that are relevant to one’s job
  13. External online courses (e.g., MOOCs) – taking relevant courses online from leading institutions and from renowned faculty
  14. Webinars – participating in a Web-based program using video conferencing software; usually a one-session offering by an expert on a specific topic
  15. Internship – working in a temporary position for the purpose of learning about a job, the work environment of that job, and the organizational culture
  16. Apprenticeship – working under the guidance of experienced employees for the purpose of learning specific skills
  17. Business case-study – drawing lessons from discussing the documented story of actual events in another organization
  18. Performance measurement – learning from measures of performance such as sales figures, production numbers, and customer service feedback
  19. Success Case Evaluation Method – a method of evaluating training (or any learning intervention) by identifying those participants who successfully applied learning in the organization and telling their stories; learning comes from analyzing those stories and drawing useful conclusions from successes and failures
  20. Assessment center – a dedicated space where employees participate in exercises designed to simulate the conditions of their jobs; observers look for specific behaviors that indicate the employee’s suitability for the work; learning comes from receiving performance feedback and planning how to improve
  21. Department meetings – often a lost opportunity for learning, these gatherings can be designed so that participants learn about processes such as planning, project management, innovation, and evaluation
  22. Testing knowledge – using results of knowledge tests to facilitate more learning
  23. Testing performance – using results of behavioral demonstrations of learning to facilitate more learning
  24. Training evaluation – learning from evidence (quantitative and qualitative) collected to show the impact that particular training programs have on individuals, teams, and the organization as a whole
  25. Learning Management System (LMS) – using the data from training program tracking software as a focus for discussing employee learning goals and progress toward those goals
  26. Roleplay – people (usually two or three) acting out roles to learn about themselves and others by putting themselves in Groupmeetingsomebody else’s shoes
  27. Reflection-in-action – learning from reflecting on an activity while doing it
  28. Reflection-on-action – learning from reflecting on an activity by looking back on what happened
  29. Reflection-for-action – learning by applying what was learned to a new situation
  30. Daily log – individual employees writing or recording learning from each day of work and then discussing their observations with co-workers
  31. Survey debrief – meeting with co-workers and other stakeholders to discuss what can be learned from the results of company surveys (such as pulse, employee satisfaction, and climate)
  32. Experiments – gathering evidence in a controlled environment to support or refute a particular change that is being proposed (for example, testing an innovation in the product development process)
  33. Prototyping – testing a new design of a product or process by constructing an example or model and then trying it out and learning from what happens
  34. Content apps – using a software application on a mobile device to provide information and instruction on-the-job, just-in-time
  35. Job share – splitting the hours required for a job with someone else and sharing experiences with each other for the purpose of learning
  36. Job rotation – trying out different jobs in an organization for the purpose of discovering the best fit and, at the same time, learning about the organization and its culture
  37. Community of practice – people who share the same interests or responsibilities in an organization come together to learn from each other
  38. Social media – using computer-mediated platforms for sharing information, such as Facebook, LinkedIn, Twitter, and blogs
  39. Benchmarking – learning by comparing the structure, policies, practices, products, and programs of one’s organization to the best in the industry
  40. Structured observation – learning about some aspect of individual, team, or organizational behavior by observing what occurs according to a set of questions and criteria
  41. Books and articles – reading books and articles that have information and expert advice about an area of needed performance improvement
  42. Video – learning as-needed from high-quality, relevant videos on sites such as TED and YouTube
  43. Recordings – learning as-needed from high-quality, relevant recordings of presentations by business and organizational experts
  44. Team reflection – working with team members to find useful meaning in data about team performance
  45. Enterprise-wide reflection – working with co-workers across the organization to find useful meaning in data about organization performance
  46. Performance support tools - print or electronic tools, such as checklists, micro-lessons, and video demonstrations, used post-training to ensure on-going performance improvement
  47. Interactive performance support system (IPSS) – performance support tools that allow the user to interact with Web-based materials for the purpose of shaping the support being provided so that it’s just-in-time and just-enough
  48. Professional conferences – attending local, regional, national, and international meetings that have presentations of content relevant to one’s work; learning comes from reflecting on that content and discussing application with others
  49. Book groups – groups of employees meeting during the workday to discuss a book they have all read; they learn from the discussion about how it applies to their work
  50. Internal wiki – like Wikipedia, this is a company Web site where any employee can contribute content that might be helpful to every employee’s learning; this could include relevant books and videos, tools such as checklists, best practices, survey results, project results, etc.

I’m sure you can think of more ways to lever learning. What would you add to this list?

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Performance Management and Alignment of Values

AlignmentA number of large companies are confronting (willingly and unwillingly) the issues around their own performance management and making some hard choices to try to improve performance by changing workplace culture. They are faced with tradeoffs between what they aspire to be as an organization and what has evolved from the intended and unintended pressures they put on their employees.

Amazon founder and CEO Jeff Bezos’ response to recent New York Times articles about work-life in the company, exposes a lack of alignment between the kind of organization that Bezos espouses and the organization that actually exists for many workers.

Brad Federman summarizes the charges against the Amazon culture in this way:

Shocking workloads, memorizing leadership principles, laminated cards describing the culture, quizzes on the culture and rewards for perfect scores, pushed to play devil’s advocate, late nights, sabotaging others careers, mechanisms to secretively provide feedback on other employees, significant turnover valued, high risk/high reward, attractive stock options, lack of concern for people with health issues or personal crisis, practiced use of counselling out, purposeful Darwinism, a.k.a Amazon.

Bezos, on the other hand, wrote in an email to his employees this week that he expects them to show empathy for the problems of their coworkers and “…hopefully, you’re having fun working with a bunch of brilliant teammates, helping invent the future, and laughing along the way.”  Apparently, Bezos thinks that Amazon is a happy, collaborative culture. This isn’t what many employees are reporting.

Zappos CEO Tony Hseih is adapting Holacracy to his organization in order to increase employee involvement and commitment. Theoretically, this structure is leaderless and depends on self-management. Zappos (owned by Amazon) also faces a cultural alignment challenge. I wrote about this in a previous post:

I do wonder about an apparent disconnect between the intention to create a company in which there are no managers and self-management and self-organization are highly valued, yet the decision to become that kind of company was decided by the CEO and is being enforced as if the company is still hierarchical and command and control. Zappo’s might aspire to be leaderless, but that will be very hard to achieve for a company in which the charismatic founder and inspirational leader is still around and the parent company is a much more traditional organization.  

Cultural change is a struggle, especially when espoused values do not align with values in use. Leaders can aspire to a humane, egalitarian workplace but if the incentives are elsewhere, employees will behave in response to the incentives. If managers are rewarded (pay, promotion, recognition, etc.) for the amount of work they do and the amount of time they spend at work, they will do all the things they need to do to look busy and productive. And they will expect the same of their direct reports. If managers are rewarded for treating their employees humanely and for involving them in decision-making, that’s what employees will do for each other. There must be alignment.

Some companies are working hard at alignment. Accenture is eliminating annual performance reviews and ranking of employees. Instead, managers are expected to provide ongoing feedback to their direct reports. CEO Pierre Nanterme became convinced that annual performance reviews and rankings were not improving performance. He believes that what improves performance is just-in-time feedback around everyday work activities. He wants employees to learn and grow and is trying to align the performance management system with those values.

Business leaders need to pay more attention to workplace culture. These days, the competition is fierce and the expectations of customers are high.  Espoused values need to be aligned with values in use if they are going to have a chance to achieve the level of productivity, creativity, and innovation needed to compete and succeed over the long term.

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What Gets Measured Gets Done…Revisited Again

The phrase, "what gets measured gets done," has become a rallying cry for trainers and evaluators. We use this to justify our work and convince CEOs that they should invest in performance measurement. However, as I've argued in previous posts, the saying is not always true and, in fact, is misleading.

One implication of the phrase is that if you measure something (customer service, productivity, sales, revenue, etc.), people will pay attention to what is being measured and do what they can to improve Survey responses those outcomes. Many examples refute this logic. GM measures quality of every part and every car yet still has recalled 29 million vehicles so far this year. The Veterans Health Administration measures patient waiting time yet still is under congressional scrutiny for wait times that were much too long. Lehman Brothers, once one of the largest investment banks in the U.S., constantly measured the performance of the securities it owned and managed, yet still had to declare bankruptcy in 2008.

In each of those cases, it appears that key stakeholders had the data but did not use the data to make their decisions. It’s as if they were trying to fulfill a compliance requirement without a commitment to improvement. Or they didn’t want to know because that would mean they would have to change something. Measurement alone is not sufficient; it’s the application of those results to decision-making that gets things done.

A variation on "what gets measured gets done," is, “what you measure is what you get.” To me, this saying has a slightly different meaning. This is more about the importance of choosing the right measure for the situation so that you are reinforcing the intended behavior and not something that you don’t want. I once consulted with a state Blue Cross Blue Shield office that proclaimed their commitment to customer service but evaluated customer service reps on the basis of how many calls they handled each hour. Number of calls handled went up; customer service went down.

Jane Bozarth, in her recent column for Learning Solutions Magazine, writes this about choosing the right measure:

Begin with the end in mind: who is the target audience, what do they need to do, how do we measure whether they are the ones accessing the program, and how do we measure their performance?

So: When looking for measures, try to find things that are meaningful, that give you real information to help real people do their jobs and to help organizations perform more efficiently. Beware of easy measures and vanity metrics.

Good advice! The tendency so often is to look for the lost key under the streetlamp because that’s where the light is. Measures are chosen because “we’ve always done it that way” or because “that’s what we know how to measure” or “that’s what everyone else does.” As Bozarth suggests, decide on what behavior you want and then decide on the best way to measure that behavior. In that way, you’re more likely to get the data and results that you need.

However, here too, the phrase has limits. What you measure is not always what you get. Many organizational factors can intervene. Maybe you are measuring the right things in the best way, but managers don’t value those outcomes, or the findings are not communicated to the stakeholders, or intervening events and unintended consequences are not factored into the results. Again, it’s not measurement per se, but what is done with those measures that makes the difference.

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Joy to the World of Work

 

It’s fitting, in this holiday season, to be talking about "joy".  Menlo Innovations, a software development company in Ann Arbor, Michigan, has made a joyful workplace its goal and has found Joy Inc that, by doing this, business success follows. In Joy, Inc., a new book by Richard Sheridan, Co-Founder and CEO of Menlo, we read how his company makes joy the center of its business model.  

Starting in 2001 and even after considerable growth and changes in location, the company has succeeded in maintaining a work environment that is joyful. Most observers would have said, “Not possible; maybe for a few months or a year but no longer; and certainly not in a weak economy.” These observers have been proven wrong and every indication is that Menlo is sustainable. Joy, Inc. tells how this happened.

Being joyful is serious business. Sheridan writes:

 

At Menlo, we have fun, we laugh a lot, and there is almost always palpable energy - but we aren’t always happy. We have a shared belief system. We are focused and driven. At times, we are cynical and sometimes downright angry. We use the energy of our anger and cynicism to fuel our work, in hopes of ending the human suffering caused by what is perhaps one of the most broken industries on the planet: information technology.

But it’s not only the information technology industry that is “broken”.  Menlo, by being very public about its culture, is saying to the world that no organization has to have a cheerless, hard-driving workplace. Businesses don’t have to be controlling, demeaning, punitive, and energy-depleting. They don’t have to be bureaucratic and authoritarian; managed by an org chart and powered by position. By explaining how Menlo works with clients, estimates costs, organizes work assignments, develops teams and leaders, and ensures quality, Sheridan provides a guidebook for creating joy in any organization.  

The success of the company doesn’t mean there haven’t been problems and challenges along the way. One of the things I like about the book is that Sheridan lets the reader in on things they did with employees, with processes, and with clients that didn’t go well. I won’t call them “mistakes” or “failures” because those aren’t terms that fit Menlo. Everything they do is an opportunity for learning. When something doesn’t go as well as intended, they use that experience to improve.

After reading Joy, Inc. and visiting the company on several occasions, I believe the key to Menlo’s success is its “learning culture”.  This is an intentional culture a la Edgar Schein's three levels: (1) the deep underlying beliefs and assumptions that are often difficult for insiders to articulate; (2) the values and principles that structure action; and (3) the symbols and artifacts that are visible on the surface for all to see. In the Menlo culture the message to employees, both implicitly and explicitly, is that we are learning together how to best serve our clients while creating an enjoyable and meaningful work environment. The “rituals and artifacts” that Sheridan describes in Joy, Inc. contribute to creating this culture: from the hiring process when prospective employees learn how to fit into Menlo, to the paired employees who learn how to work together on job tasks, to constant conversations during the workday, to lunch n’learns, to storytelling, to leaders setting an example for continuous learning, and to speaking about The Menlo Way to other companies and to the public. The value placed on the joy of learning comes through loud and clear to employees and observers. 

 

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Customer Satisfaction: Gaming the System

When it comes to measuring customer satisfaction, managers are gaming the system. They are advising customers to answer survey questions in a way that makes the manager look good, i.e., a rating of 5 on a 5-point scale. Rather than trying to improve the customer experience, they are trying to improve their scores.

I understand their motivation. An executive in a central office or a hired survey company might be collecting this data and drawing conclusions about customer service in a location that they may or may not have visited and probably know little. Sometimes the data folks understand the business and sometimes they don’t. Sometimes they understand what customers mean by a particular rating and sometimes they don’t. Sometimes they ask valid and reliable questions and sometimes they don’t. A phone company service technician once pleaded with me not to send a compliment to his supervisor because the “system” counts every comment from a customer as a complaint and it would go against him.

William Grimes, in a column for the N.Y. Times, writes:

In the auto industry, which tries to measure customer satisfaction at every possible stage, from the first tentative Web search to the last service visit, the assessment ritual can become a kind of performance.

Sales representatives have been known to show pictures of their wives and children as they plead for a favorable review in their dealership’s satisfaction survey. Some show their customers a sample survey already ticked off with top marks in every rating category. Dealers sometimes throw in a free tank of gas or a free oil change as a quid pro quo.

Pressure tactics have crept into other industries as well. Cable technicians, after completing an installation or repair, often call into the head office to report and then hand their cellphone over to the customer for a quick round of questioning about the service, an awkward conversation with the technician standing a few feet away.

Sales clerks who once concluded a transaction with “Have a nice day” now plead with customers to fill out surveys and award good marks because “my job depends on it.”

This is a sign I observed on the checkout counter of a CVS/Pharmacy:

CVS Sign

Clearly, this store is trying to influence ratings, not by improving customer service but my pleading for leniency.

I’ve written before about helpdesk employees who, at the end of a phone inquiry, ask customers to report that they were highly satisfied with the service.

Encouraging a particular rating does not tell you what customers really think. You have to ask yourself, “Do I want high ratings or do I want to know the truth?” Customers might tell you what they think you want to hear and then not buy again and not recommend your product and services to others.

Zingerman’s, which is well known for creating an outstanding customer experience, says in its training video that most customers don’t like to complain. By discouraging negative comments a company only makes customers more uncomfortable and more likely to misrepresent what they really think. Then managers will not hear what they need to hear.

If you want to improve performance, ask customers for feedback in a safe and neutral way. If you don’t care about improving performance, don’t ask for feedback. 

Related articles

Customer Service Run Amok
Ecommerce: One Size Does Not Fit All

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Ecommerce: One Size Does Not Fit All

Why do online shopping experiences have to be so difficult? It’s as if companies forget everything they know about customer service when they build a Web site.  The IT wizards work their magic behind a curtain and the marketing and sales folks accept whatever bells and whistles are handed to them.

A New York Times article about online books quotes Peter Meyers, author of “Breaking the Page,” as saying:

A lot of these [Web-based] solutions were born out of a programmer’s ability to do something rather than the reader’s enthusiasm for things they need.  We pursued distractions and called them enhancements.

This seems to describe much of what goes on in Web site development today. The gap between an elegant Web site from an IT point-of-view and the quality of experience from a customer’s point-of-view appears to be as wide as ever. The recent flap about the Obamacare Web site (www.HealthCare.gov ) and the Web-based "Common Application" (www.commonapp.org) for college admissions are just two examples. If the developers of these sites had started with a great customer experience being the end-goal, they might not have had the launch problems that occurred.

Eszter Hargittai, professor of communication studies at Northwestern University, writes:

What may be completely intuitive actions for Web designers and engineers are far from the norm for those who only use the Web occasionally and mainly do so to correspond with family members once in a while on Facebook or by email.

All organizations whether government, business, or nonprofit, need to design the Web experience for the customer, not for IT. Engaging with the Web site should be an emotionally positive experience as well as result in a successful transaction. It’s not enough to have the right boxes, right forms, and right buttons. Customers want to feel the same dignity, respect, and trust that they feel in a well-run store, restaurant, or entertainment venue.

This is not easy. I know from my own experience developing Learning2BGreat an ecommerce Web site, that trial and error, based on feedback from customers, is part of the process. What’s important is keeping the goal in mind. Is it to have something that is technically sophisticated or is it to have something that customers enjoy using? I’ve caught myself more than once being so excited about functionality that I lost sight of the goal.

Web site developers could learn much from Zingerman’s approach to the customer experience. Zingermans unique approachZingerman’s is a deli and gourmet food retailer that Inc. Magazine calls “the coolest small company in America” and is included in Bo Burlinghan’s book, Small Giants. After 25 years and many mistakes and successes, the company has figured out how to create a great customer experience. First of all, they take a one-customer-at-a-time approach. Staff have rules but they also break the rules when it meets the needs of a customer. They have processes but when a moment-of-truth arises, they do what they need to do to keep a customer coming back.

This kind of customer service is a challenge for Web sites that are intended to work exactly the same way for every customer and collect and disseminate exactly the same user information. However, they don’t and shouldn’t. This is what managers need to realize. They need to work with IT to develop a site that adapts to the needs of users from different backgrounds, motivations, and abilities. One-size-fits-all might work for ball caps but it doesn’t work for the user experience. 

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Customer Service Run Amok

I’m afraid we are witnessing a trend in customer servicethat signals the end of a short-lived focus on the customer. Call me old-fashioned, but I think this is a huge mistake on the part of companies that want to retain customers in a highly competitive environment.  Not everyone wants to talk to an automated phone service or talk to a customer service rep who acts like a robot.

I recently called the “customer service and support” phone number of a leading telecommunications MP900289863 company in the U.S. I was inquiring about a charge on my bill that I didn’t understand and I also wanted to arrange automatic payment of my bill. Now, you’d think that a company that size would have state-of-the-art, world-class customer service.  That was not my experience.

First of all, it took me 20 minutes to find the right number to call. I started with the main customer service number which took me to a list of automated options, none of which described my problem. When I finally reached a live human voice, I heard the person say, “How can we make you feel like a valued customer today?” That’s a good start, but then we proceeded to have a conversation filled with lines like:

  • "I will go the extra mile to solve this problem."
  • "I appreciate your patience so much."
  • "Whatever it takes I will make this right for you."
  • "I appreciate your patience so much."
  • "I will stay on the line until you are satisfied."
  • "I appreciate your patience so much."
  • "It is my goal to make sure you are a satisfied customer today."
  • "I appreciate your patience so much."
  • "Thank you for being the best part of [company name]."

At one point in our conversation, this rep had to leave for a few minutes to check on a request and when she returned she started saying these lines all over again.  I might as well have been talking to HAL. And then, to top things off, I got this question, “Would you say that I treated you well during this call today?” This question reminded me of the car salesmen that I once had who ended the sale by asking me to give him a high rating when I received the JD Power survey. Obviously, measures of customer satisfaction are figuring more into performance reviews than they used to. But I can’t evaluate service until I see if the problem has been solved or, in the case of the car dealer, my new car has been delivered as promised.

Now, in fairness, I might have been talking to a new customer service rep who had been asked to use a script until she could integrate the intent of the statements into her own words. However, in recent weeks, I have had similar conversations with customer service reps in three different leading telecommunications companies, all using a similar set of statements over and over again.

I worry that customer service, for the sake of efficiency, is becoming so automated and routinized that the words are meaningless and the service is annoying and frustrating. Poor customer service is symptomatic of a company culture that espouses excellence but, in practice, only does things that reduce cost and increase efficiency. Telecommunications companies, in particular, would do well to heed the advice of J. Higgins:

  1. Listen to customers; pay attention so you can resolve the problem as the customer views it
  2. Apologize once for the problem and then get on with solving it
  3. Only promise what you can deliver
  4. Make it easy for customers to get back to you if they have more questions or want to check on progress
  5. Make learning about providing excellent customer service a continuous, on-going process
  6. Always be respectful of customers

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Listen to Your Customer

I heard Patrick Doyle, CEO of Domino’s Pizza, speak at ameeting of the Washtenaw Economic Club on Thursday (February 21, 2013). I was impressed by his honesty about himself and his company and his sense of humor even in the face of threats to Domino’s survival.  In 2009, at a time of declining revenue and store closings, Domino’s changed its product entirely. Doyle became CEO in 2010 and it was up to him to launch the new product. If customers didn’t like the new product, that could have been the end of his career with Domino’s. He met the challenge and because of having the right product, a successful advertising campaign, and a comprehensive training program that reached every employee in all the stores, the company regained its position as market leader.

Domino’s had been known for its delivery service, not for its pizza. According to all of their taste tests, Dominos
the pizza was as good as their competitors. But that didn’t matter. What mattered is that consumers did not think that the taste was better than their competitors. So the leaders listened to their customers and redesigned their pizza.  And they were honest about this in their advertising. In the ads, they admitted that the pizza had not been good but that they had completely changed it and asked people to give it a try. It worked. Honesty resulted in a dramatic increase in sales and profit. This made franchisees very happy because they had taken the risk along with Doyle and the other Domino’s executives.

I’ve heard the mantra, “listen to your customer”, for many years. Now, everyone says that they listen to their customers. Help desks and customer surveys are ubiquitous. However, I don’t see much change in companies because of all this “listening”. Before I got off the phone with an AT&T customer service rep recently, he asked if he could count on me to give him a good score when I received a follow-up survey. How is that “listening to your customer”?

As a business owner myself, I’m trying to listen to my customers every day. I am continually amazed by what I can learn from them. A customer (member) of Learning to be Great™ told me that, from her perspective, the company is information curation and lead generation. I hadn’t thought about the business that way but it made complete sense to me. This perspective will change how we market the company and what services we develop to support our members and users. It’s great to have customers who care enough to tell us the truth. We just have to be sure to listen.

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Employee Satisfaction and Engagement Once Again Linked to Financial Success

Still another study , recently published by The Forum at Northwestern University, supports the notion that satisfied and engaged employees are essential to the financial success of companies. Dr. James Oakley, now Associate Professor of Marketing at UNC Charlotte's Belk College of Business, led this comprehensive study of these factors across a sample of 100 media companies. His research team surveyed a representative group of employees in each organization and received responses from 5,568 employees, averaging about 60 respondents from each company. They decided on doing the research within one industry in order to prevent some of the problems that occur when collecting data from a heterogeneous sample of businesses. Several different survey instruments were used to measure culture, climate, HR managerial practices, and market characteristics affecting each company.

  • They used R.A. Cooke and D.M. Rousseau’s (1988) definition of organizational culture: “…the ways of thinking, behaving, and believing that members of a social unit have in common.”
  • They defined organizational climate as: “…the way that organizations operationalize their culture in daily routines and behaviors.”
  • HR managerial practices included selection, development, performance management, and compensation.
  • Market characteristics included customer satisfaction, retention, and loyalty. And profitability was used as a proxy for financial success.

The following chart represents key factors that were identified and the positive and negative relationships among these factors.

Satisfaction Engagement Profitability

A major finding was “… a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and improved financial performance.”

Based on their findings, the investigators recommend the following:

  1. Ensure that the employee voice is being heard up and down the organization and that they feel they are making a difference.
  2. Regularly survey employees about the strengths and weaknesses of the organization and take visible action based on that information.
  3. Develop a healthy mix of employee cooperation and competition for the benefit of customers.
  4. Establish clear performance objectives related to the customer experience and recognize employees for achieving those goals.

What I like about this study is that, unlike so many studies done by consulting firms, this research examines intervening variables that explain how and why employee satisfaction and engagement are linked to financial outcomes of companies and how culture and climate contribute to the employee experience as well as the customer experience. Of course, one could still argue that the links are not necessarily causal. It could be that company profitability causes high levels of employee satisfaction and engagement rather than the other way around. But at least in the case of this research there is a compelling theory to go with the data.

The study adds to evidence that is piling up around the impact of employee satisfaction and engagement on organization success. As we emerge from a depressed world-wide economy, the long-term financial success and sustainability of companies will be more important than ever. Therefore, we need to pay greater attention to the conditions that contribute to a positive and supportive work culture. Now, if we can only get leaders to pay attention to these factors in their organizations. 

 

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Investing in Training in Downturns and Upturns

The U.S. is emerging from a training drought that occurred during the worst economic period since the Great Depression. At least, that’s what’s indicated by organizations that do this kind of Rise in profits
research. ASTD reports an increase in spending on L&D in 2010 (latest year for which data is available); they estimate companies spent about $171.5 billion. Bersin & Associates reports that corporate spending on training increased 9.5% in 2011 – the largest gain in three years.  And Training magazine’s research found a 13% increase in spending on L&D in 2011. Each of these studies uses a different method for calculating spending. However, the trend is undeniable: spending on employee training is increasing.  

With this increase in spending comes a great opportunity to do things right. In our book, The 5As Framework, Sean Murray and I wrote that most training programs significantly impact only 10% to 20% of their participants. This represents a huge waste that no organization can afford any longer. As the worldwide recession comes to an end, organizations must use every dollar very wisely. Garry Marsh, director of the U.K. company THM Business Simulations, gives us some thoughts about best ways to use those dollars. Here are those seven ideas with my spin on each one:

  • Get it right first time – Think in terms of what learners need, not the latest training fad (content or delivery). Only provide experiences that will help learners improve performance and contribute to achieving the strategic goals of the organization – no more and no less. Pay attention to the quality of content and quality of the learning intervention.
  • Keep employee satisfaction high – Involving employees in opportunities to learn is an effective way to increase engagement. Many employees value learning more than a pay increase. To keep engagement high, make continuous learning part of the culture of the organization.
  • Train your managers – Many managers did not reach that position because they were great managers of people. This is something that all managers need to keep learning. And if organizations want to prevent their top talent from leaving as the economy improves, they must give managers the opportunity to learn and grow.
  • Focus on customer experience – All organizations should have the improvement of customer experience as one of their top strategic goals. To achieve this goal, they will have to train employees in how to create a better experience. Learning about the customer experience should be on every manager’s agenda.
  • Spend less, get more – Organizations should not rely on the usual suspects and usual methods for delivery of training. It’s about learning; it’s not about glitzy programs. It doesn’t have to cost much to develop talent. Maybe a manager will become a more effective team leader with the help of a mentor. Maybe a manager will become more effective at giving performance feedback with the help of a coach. Maybe a manager will become better at financial management by attending the CEO’s “open-book” meetings.
  • Be ready for the upturn – As the economy improves and companies start hiring again, the best talent will look elsewhere. They have stayed only because nobody else was growing and hiring. Unless managers continue to see opportunities in their current organizations and they feel respect from their leadership, they will be gone. Organizations should do something about these conditions now.
  • Look after yourself – Many resources are available to help any organization be successful while keeping costs low. Look for help internally and externally. Use what the organization already owns when that makes sense and then go outside to peers, consultants, and training organizations when they can help you improve performance and achieve your business goals.

 

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What Do You Mean?

Dan Pallotta, president of Advertising for Humanity and HBR blogger, in a post titled “I Don't Understand What Anyone Is Saying Anymore”, writes about business jargon and how it affects communication in organizations. The blog post must have hit a nerve because it has broken the record for most comments to a single HBR Blog Network post.

One of these comments is a perfect way to begin 2012. That is, with humor that pokes fun at ourselves and the way we talk to each other. The commenter, BrainToniq (Scott Ohlgren), writes as if talking to his staff:

While in the run-up to transitioning in this phase of right-sizing and redeployment, we still need MP900316793 to—at the end of the day—drill down and make sure that our mission-critical, goal-oriented core competencies are in alignment and on the same page as the most current best-practices paradigm. While we as a customer-centric longtail company are still on the runway, we need to each firewall enough time to allow out-of-the-box thinking and strategize the low-hanging fruit in the marketplace. Envisioning the metrics here will require accountability management on each team member to come up with a value-added solution that doesn’t require putting out fires or a lot of bandwidth. Bottom line? The truth is we have to step up, work smarter, not harder, and create a Web 2.0 solution. This is an exciting model for limitless potential and mutually agreed synergies!

I’ve got an open door policy, so touch base and keep me in the loop. If we can move forward and proactively get on the same page about this, it’ll be a win-win-win. Remember: our people make the difference.

Come again? The truth is this is how we sound sometimes. And with email, text messaging, and all of the forms of social media, the use of buzzwords to replace plain speaking has gotten much worse. We are sacrificing clarity for brevity, which means there is greater risk of miscommunication.

Dan Pallotta’s solution is to “speak authentically” in communicating with employees and customers. He writes:

You will gain tremendous credibility, become much more productive, make those around you much more productive, and experience a great deal more joy in your working life if you look someone in the eye after hearing one of these verbal brain jammers and tell the person, "I don't have any idea what you just said to me."

Let's hope communication improves in all of our organizations in 2012. 

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High Touch vs. High Tech

Technology is putting up barriers to the kind of deep listening that helps two people learn from each other. This is especially true in healthcare. Medical patients, often nervous, scared, and in pain, are comforted by the personal caring and touch of their doctors, yet technology (and time pressure) is getting in the way of that relationship. Abraham Verghese, Stanford University physician and best-selling author, argues that the tendency today is for doctors to order tests before or in lieu of conducting a thorough physical exam. By doing this, they risk missing information that can help them make a more accurate diagnosis and enhance the patient experience. He makes that point in this TED talk:

http://video.ted.com/assets/player/swf/EmbedPlayer.swf  

An emphasis on “high tech” at the expense of “high touch” is happening in other workplace situations as well. We seem to be moving away from closeness and the expression of caring between employees and their supervisors. The work relationship has become automated and digitized, putting more distance between people who should be continuously learning together. Email, texting, conference calls, and Skype meetings are replacing face-to-face conversation. The efficiency of these technologies is wonderful; I couldn’t accomplish nearly as much if I didn’t have them.  But something is lost when performance feedback is emailed and difficult conversations are held over the phone.

The effect is limited when performance reviews are reduced to an annual exchange of evaluation forms between employee and supervisor. Employees are more likely to respect the sender, hear the message, and change behavior when the encounter between these collaborators is in-person and over a dedicated and sufficient amount of time. Maybe it doesn’t require physical touch, but proximity and deep listening, especially in western culture, conveys a level of respect and caring that cannot be felt from the latest communication technology.  

 

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Patient Experience

Having recently assisted a family medicine department with their annual retreat where the “patient experience” was a major topic of discussion, I have renewed my interest in the customer experience economy and, in particular, how that notion applies to healthcare.

Studies of customer experience (although sometimes confused with customer service) in other industries are quite common. For example, the Beyond Philosophy 2011 Global Customer Experience Management Survey reports:

The top three companies most admired by CE experts for the customer experience they deliver are technology companies, with Apple ranking first, followed by Amazon and Zappos. “Apple has married all the elements of its experience and connected with its customers in a deeply emotional, irrational way,” said Walden, adding, “Amazon put a stake in the ground when it announced it would become the world’s most customer-centric company, and Zappos claims to be a customer service organization that happens to sell shoes.”

But what about healthcare? Who are the leaders in customer experience in doctors’ offices, clinics, and hospitals? The Beryl Institute defines the “patient experience” as “the sum of all interactions, shaped by an organization’s culture, that influence patient perceptions across the continuum of care.” Are there good examples of healthcare organizations that put this holistic view of quality into practice?

Some examples of healthcare organizations that care deeply about the customer experience are:

UCLA Hospital System – Their mission is “Healing humankind one patient at a time, by improving health, alleviating suffering, and delivering acts of kindness.” Dr. David T. Feinberg, Associate Vice Chancellor and CEO for the UCLA Hospital System, describes how that mission has been applied in the following entertaining and inspiring TED talk.

[youtube https://www.youtube.com/watch?v=cZ5u7p-ZNuE]  

St. Jude Children’s Research Hospital – One of its strongest values is “a commitment to provide our patients with the highest quality of medical and supportive care, and their families with the level of information and support necessary for them to make informed decisions and to become active participants in the care of their children.” I saw this played out at St. Jude in the way spaces are designed for families and the care that employees show for children and their parents.

Sharp Healthcare – This San Diego hospital system is striving to be:

The best place to work — attracting highly skilled and passionate staff members who are focused on providing quality health care and building a culture of teamwork, recognition, celebration and professional and personal growth.

The best place to practice medicine — creating an environment in which physicians enjoy positive, collaborative relationships with nurses and other caregivers.

The best place to receive care — providing a new standard of service in the health care industry by employing service-oriented individuals who see it as their privilege to exceed the expectations of every patient by treating them with the utmost care, compassion and respect.

Are there other examples of a superior patient experience? Every clinic and hospital says that it cares about patients, but which ones are making that experience top priority? What are they actually doing to reduce patient anxiety, build trust and confidence, encourage healthy behavior, develop loyalty, and, of course, achieve positive outcomes for patients? 

 

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Complacency in the Cockpit?

Two Northwest Airlines pilots may have been asleep at the wheel when their Minneapolis-bound plane overshot its destination by 150 miles before they realized what had happened, turned the plane around, and returned to their destination. One national TV commentator speculated that since many passenger jets today have the technology to essentially fly themselves, this may have been a case of pilots becoming complacent and not fully doing their job of closely monitoring the plane’s performance. In a previous blog post, I labeled this kind of behavior the “complacency syndrome.”

Airplane pilots are not the only employees who risk complacency. Staying with air-travel examples, I have noticed TSA employees being more interested in socializing with their co-workers than paying attention to the repetitive and mind-numbing task of checking people and their luggage day after day. And flight attendants, who have to announce safety instructions at the beginning of every flight, doing this sounding like they couldn’t care less about safety. And luggage handlers who, over time, become careless and lackadaisical in their treatment of passengers’ precious goods, which leads to lost and damaged property. It’s unpleasant and annoying to passengers when flight attendants and luggage handlers suffer from the complacency syndrome; it’s life-threatening when TSA officers and airline pilots have this disease.   

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Customer Service at Enterprise Rent-A-Car

Examples of outstanding customer service, where an organization truly puts the customer first and it’s not just marketing rhetoric, are rare these days. Often, a company’s complicated automated phone system is what they try to pass for a commitment to the customer. So when I was given “royal Enterprise image treatment” by an Enterprise Rent-A-Car company employee this week, I was taken aback. This employee managed to keep my day from turning into what could have been a disaster.

It all began with a car in my garage that wouldn’t start. AAA sent a tow truck driver to my house. He arrived promptly and, knowing the peculiarities of my 2000 Volvo, got the engine going in a matter of minutes. So far, so good. Not wanting to take a chance on the battery dying again, I immediately drove the car to my dealership, expecting to replace the battery and be on my way in a short time and back to my office for a full day of work. But once the car was up on the rack, the mechanic found a number of other serious problems (all legitimate) and he said that he needed to keep it for the whole day. The dealership offered to arrange a car for me to use. I accepted the offer but I was thinking that this was going to set me back hours. Within a few minutes, Tom Cosgrove showed up with a van to take this frustrated car owner to the Ann Arbor office of Enterprise. Once in the office, Tom immediately began to do the paperwork to set me up with a car and get me on my way as quickly as possible. The only problem was, I couldn’t find my driver’s license which was missing from my wallet. I was a bit frantic thinking about the legal implications of this situation. “No problem,” Tom said. He would drive me to my house to look for my license. All of the other employees at Enterprise looked like this was normal operating procedure. So back into the van we went, drove across town, and arrived at my house only to discover that I didn’t have my house key with me. “No problem,” Tom said. “I’ll wait while you get a key from your neighbor.” Fortunately my neighbor was home, found the spare key, and I got into my house.

After a frantic house search, going through the pockets of anything I had worn in the past several weeks, I failed to find my license. I went back to the waiting van, expecting to see annoyance in Tom’s face. To the contrary, he couldn’t have been more understanding. “No problem,” Tom said. “This isn’t the first time this has happened. I’ll drive you to the Secretary of State’s office and you can get a duplicate license.” At this point, I didn't want to ask him to waste any more of his valuable time due to my mistakes, so I said that I would stay where I was. “No problem," Tom said, and back to his office he went. He couldn’t have been more cooperative and gracious the whole morning. I don’t know if Enterprise hires well, or trains well; it’s probably both. Enterprise lost money on me that day, but gained a loyal fan. (My driver’s license turned up the next day in my fax machine. Don’t ask.)

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Amazon.com Continues to Put Customers First

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This is no time to be short changing your customers. Amazon.com is a great example of the positive things that can happen when you continue to keep customers your primary focus. The company has not let the depressed economy become an excuse to stop doing the things that have made them successful. Fourth quarter sales at Amazon were up 18%. BusinessWeek recently put Amazon top on its list of this year's "customer service champs."

What are they doing that many other companies are not doing? First of all, they pay attention to the entire customer experience. And by customer, they mean everyone, including buyers, distributers, re-sellers, small merchants who sell through Amazon, and, as I know from my own experience, writers and publishers. Jeff Bezos, the Fortune 500 CEO with the mindset of a start-up entrepreneur, said in an interview with PBS Nightly Business Report's Scott Gurvey:

We didn’t do anything special to recognize this economy…we continue to focus on fundamental things we’ve focused on for 14 years: having the lowest price, having the biggest selection, and getting products to customers really quickly and accurately…Our whole mentality around how we run the company is to focus on obsessing over the customer rather than our competitors. We try to pay attention to our competitors, but we don’t obsess over them.

I have to assume that their customer service training is exceptional. Technology takes care of most of the buying process, but when there is a special request or problem, employees get involved. Their responses are consistent, decisive, and intended to satisfy customers even when it is a financial loss to the company in the short run. The proof of the effectiveness of this approach is in the numbers and reputation of this exceptional company.

Companies are making deep cuts across the board and doing anything they can to reduce costs. The customer experience and customer service are often victims of this slashing. Amazon is an example of a company that thinks differently about the economy and customers and, so far, has the evidence that proves them right.

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Productivity Swap Bubble

And you thought "credit swaps" were bad! Wait until we get into the "productivity swap" bubble. This is the warning from John Psarouthakis, successful entrepreneur, and Tom Ferguson, musical entertainer. They say in Other Voices column of the January 12 issue of Crain's Detroit Business that the productivity of companies is shifting from employees to customers and this shift is not being recognized in measures of output. They write:

For every tick of productivity a customer expends, productivity ascribed to that company should be reduced two ticks: one because it didn't do the work, another because it outsourced the work, making it a debt.

This outsourcing of productivity is obvious to me...now that Psarouthakis and Ferguson have brought it to my attention. The classic is customers pumping gas, washing car windows,and checking oil at so-called "service stations". Also, customers must already know the answers to their own questions when calling an automated (so-called) "help desk" or else they won't get to the right information. Grocery stores are installing automated check-out stations where customers do all the work pricing and bagging groceries. Airlines penalize customers for not using online services to make their own travel arrangements and issue their own tickets and then airlines want customers to check their own bags at the airport. Book stores are rewarding their customers for ordering books online, thereby eliminating the need for knowledgeable, helpful store clerks. And, of course, there are the ubiquitous ATMs which have shifted the work of personal banking from tellers and bankers to bank customers.

The swap is on. What will happen when this productivity bubble bursts? Will we discover that our GNP has been a sham and that much of what was thought to be worker productivity is really customer productivity? Will there be a backlash against this shift? What effect will this have on our fragile economy?

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