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Sunday, 15 April 2018

How Do You Handle Complaints? You Need to Recover in Style!

I posted a blog recently mentioning a problem that I had encountered with a large corporate that I had hired to provide a service to my business. Things have not gone well and I decided to part company while still waiting for completion of a statutory submission.

Having escalated the problem I was called by a Senior Manager who could not have been more helpful and reassuring.

She was rightly concerned at the delays I had experienced and after a long listing of the problems she thanked me for the feedback and assured me that she would take up all the issues and make sure that they don’t happen again.

I am no cynic but how often do we hear on radio and TV that “lessons have been learnt and it won’t happen again”. It has become something of a platitude and it arouses in me a deep sigh and “Oh yes?”  

While these statements are made, I am sure, in all good faith there is a tendency to look at a complaint as an internal problem rather than one that directly affects the customer.

The fact is that while it is nice to hear that our complaint is being taken seriously we really don’t want to know about the investigation, what went wrong, how it can be prevented in the future and,worst of all, who is to blame.

Dropping into blame culture mode is, together with,”it’s company policy”  the worst possible excuses for a problem.

What the customer wants to hear is  how am I personally going to be satisfied in this particular instance.

I really don’t want to know about your problems with people off sick or a computer glitch. I just want to know when MY issue will be solved satisfactorily.

I have known businesses who take complaints so seriously that they are all referred to the CEO. On the other hand there are companies who are never wrong and treat complaints with indifference and disdain.

The bald fact is that complaints are feedback about your performance and need to be taken seriously.

One way, of course, is to have a Customer Service Department, often these days sadly situated in some far off land and staffed by people who are far away from the action and the culture of the business.

It is that detachment that can preclude a personalised answer to a query but rather one dictated by the rules and company policy. There are exceptions I am glad to say with the wonderful Apple in the forefront of all that is good.

The Ritz-Carlton hotel group used to have and probably still has a strap line for all the staff that says: “We are ladies and gentlemen serving ladies and gentlemen”.

Moreover there is a rule (admirable this time) that anyone in the business approached by a guest with a complaint or query is expected to handle the issue and put it right without the need to refer it upwards.

Complaints are not an internal issue even if they have to be corrected by internal means.  They are an expression of the level of customer satisfaction achieved by the business and hence they are an invaluable denominator of reputation.

It is said that when we have a complaint we tell eighteen people about it whereas when we experience great service we tell only one or two.

A speaker at my Vistage CEO peer group talking about complaints suggested that “we should recover in style”. Doing just that can delight the customer and enhance the reputation. In fact handling a complaint in a way that really sorts out the customer’s problem can build an enhanced level of confidence in our product and service.

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Sunday, 8 April 2018

Do You Delegate or Do You Interfere? Check These Four Questions!

  • What should I do more of?
  • What should I do less of?
  • What should I start doing?
  • What should I STOP doing?

I was involved this week in an animated discussion on leadership during  a one-to-one with a member of my Vistage CEO peer group when I was trying to rate the significance of a range of leadership functions.

It is task that many sages, far wiser than I, would balk at or offer some thoughts with perhaps slant towards the controversial.

Personally I like “The people want me to be their leader.  I must follow them”.

The fact is that great leadership demands an inordinately long list of attributes that taken as a group describe a paragon of all the virtues.  Sadly I haven’t met such an individual as yet even if I have been privileged to know some remarkable candidates.

In the end leaders need followers and the key to great leadership is the ability to manage expectations, to assist people to become engaged and generally to develop a communication style that is consistent, transparent and clear.

Above all the human need to be involved must be severely curtailed.  There is nothing more demeaning to a team member than being constantly told what to do and then checked to see if it has been done.  That is micro-managing.

Micro-managing the people is not leadership. It is two people doing the job of one and is expensive as a consequence.  Indeed I recall that in the early days of Vistage in the UK, we used to give out card bookmarks with some wise leadership questions, one of which was:

“Whose job am I doing right now?”.

It is enormously tempting for a leader to ask for a task to be done, then to describe how to accomplish the task, who to talk to, where to find information and how long it should take.  All of this the leader knows (as probably does the team member) and assumes that it will be helpful information.

Wise people have said on many occasions that the best way to develop people is to appoint the very best then say what is needed and let them get on with it.  It should not be necessary, in general, to monitor constantly their performance in detail.

If we appoint great people then it should be a matter of trust and hopefully mutual trust, to expect that they will accomplish the task in a way that they decide is the most appropriate.  As long as it is honest, legal, effective and understandable then that should be sufficient. The only questions then to ask are when will it be completed and what will be the expected outcome?

All of this implies that the answer is delegation and that further implies that the leader must know precisely what outcome is desired and who in the team is most likely to achieve the desired outcome.

It is a good idea from both points of view to understand that monitoring progress is desirable and constant nagging questioning is decidedly not.

A regular meeting, say weekly, with a progress report detailed as necessary, will help the leader to understand the current position and possibly even eliminate the need for further questioning.

Delegation is not abdication of responsibility; it is the ability of the leader to trust the ability of the team member (whom he/she has probably appointed in the first place) to undertake a task resulting in a mutually satisfactory outcome.

We need to resist the “leave it to me, I’ll do it” syndrome.  Tempting though it may be we might just find that other people can undertake a task more effectively, more quickly and more satisfactorily than we can so give then their head and get out of their way.  
  • What should I do More of?
  • What should I do Less of?
  • What should I Start doing?
  • What should I STOP doing?
Ask yourself these questions and answer then honestly, then take action.

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Monday, 2 April 2018

Giving Good Service? Better to Make it Exceptional!

Why is it that so many people in business and almost everyone in the media persist in equating being competitive solely with price?

The word goes out that high street retailers are (still) being terminally hit by  unscrupulous competition online at vastly lower prices.

As usual the examples of these generalisations are carefully crafted to justify the premise and without any counterbalancing evidence to the contrary.

In fact many high street retailers do not look upon online offerings as competition but rather as another opportunity to market their wares in a format that is additional to the traditional.

The fact is that competition shows itself in many guises other than price. Firstly, is this product what I want?  Then how quickly is it available, is there a well-known brand, will the quality be what I want, how reliable is the seller and finally, how much?

Several of these questions can be unsaid and we spend nanoseconds in running them past but occur they do, unless we happen to be relentless impulse shoppers.

I have long advocated, whether B2B or B2C, leaving price considerations to the end of a marketing decision process and looking at other ways to encourage and satisfy the purchaser.

Great service is one that makes a vast difference to the buying experience and while it can be a process, in the end it should be one of the values that we espouse and should be effectively a major strand of the culture of the business.

Indeed I cannot see why instead of great service we cannot offer exceptional service.

This thought, I confess, has been sparked by a service level that I have personally experienced from two major suppliers,  one national and one global, that I have used lately.

The national supplier is supermarket giant Sainsbury’s and as I don’t drive anymore I decided to try out their home delivery service rather than getting a taxi to the store.

The web based ordering process is somewhat clunky and took a little effort to understand and use but now I have some experience it is easy. So where does exceptional service come in?

It comes from the drivers who deliver my orders. After some weeks and meeting several of these gentlemen (and I do mean, gentlemen) I am in awe of a recruitment process that can find, appoint and employ such brilliant ambassadors for the company.

Always pleasant and cheerful, ready to assist in any way possible, they and by definition Sainsbury’s, give exceptional customer service.

The global company is Apple. I recently acquired a large version iPad which I love and was distressed one day to discover a hairline crack across the top right corner of the screen.

The iPad was still within warranty but a bout if flu took me perilously close the the deadline so I called Applecare to discuss. A charming lady based in Greece took my call, took over the iPad remotely and sorted out all the necessary background stuff and the made an appointment for me at the Apple Genius Bar in the nearest Apple store.

The young genius who served me was equally charming, smiling and helpful. When I told him my problem and emphasised that I hat I had not dropped my iPad, he said calmly “We don’t repair faults on the screen so we will replace the iPad for you

This he did, transferred everything over to the new device, sorted out a software problem that I had and finally said to me:

Thank you, that was a great first customer and a great start to my working day!”  

He thanked me!

Consider this. Neither Apple or Sainsbury’s are low price suppliers but not only would I not even consider trying out their competitors but I am delighted to tell the (or at least, the world of Ivan’s Blog) how exceptional they both are.

Vistage speaker Malcolm Smith says it’s not about the price.  I believe it’s the power of giving exceptional service.

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Saturday, 24 March 2018

Optimist or Pessimist? Be Sure to Cage the Chimp!

I always considered myself to be an incurable optimist until an event occurred recently that caused me to rethink. In fact pessimism and optimism are on the same continuum and we vary our position from day today, from event to event. I was right in pessimism mode.

I spend a deal of time as a mentor encouraging the members of my Vistage CEO peer group to look to a bright future will and generally deal comfortably with any bumps that always happen on the way.

Spring for me is the best season. It has all the promise of warm days ahead, green shoots heralding new growth an all in all, portends a bright future.

However, the event that made me examine myself was a problem I had with a very large professional enterprise which I had retained. After a period where relationships and service were going well all of a sudden everything changed.

Communications almost stopped and I couldn’t seem to be able to improve the situation.  As the work they were doing was statutory it began to be serious.

I starred to do precisely what I advise all my members NOT to do and that is to worry.  In the film, Bridge of Spies, the defending attorney played by Tom Hanks tells his client played by Mark Rylance that if he is found guilty it could mean the death penalty for treason.

MR: “I understand
TH: “Aren’t you worried?
MR: “Why, would it help?

A brilliant piece of advice to anyone in worry mode that I mention frequently and ignored completely.

The really sensible thing that I did was to take advice from of my group and she was both reassuring and helpful. I took her advice, the situation is now under control and the feeling of relief is palpable.

I should have known better. Some years ago I worked as a special  product engineer covering the North of England and one Friday late afternoon I took a call from the manager of our Leeds office who peremptorily told me to be in his office at 9.00am on Monday morning. I didn’t like him and the feeling was definitely mutual.

I didn’t enjoy the weekend simply because worry took over. I was going to  lose my job, my family would reject me and there would be nothing for it but to take the Beachy Head solution.

I did as I was instructed and turned up, apprehensive, pale and wan, at 9.0-am only to hear him say:

“Thank you so much for coming. I have a problem that only you can solve”.  

I suppose that I felt rather stupid at the waste of emotion but relief was the overwhelming feeling.

Again, did I learn from this experience?  Not really because it does still happen from time to time.

Professor Steve Peters in his great book, The Chimp Paradox, says that the chimp or emotional brain has five times the power of the human or rational brain and unless we learn how metaphorically to cage the chimp, we will allow our emotions to dominate.

Mark Twain said that as an old man he had known many troubles but most of them never happened.  It seems to me that the most sensible thing that I can do is to take my own advice.

“Physician, heal thyself” (Luke 4.2) says it all.

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Sunday, 18 March 2018

Looking to Make People Accountable? Help Them to be Self-Accountable!

We in business tend to talk glibly about and even assume that there is a process in place for accountability but, in truth, is there?

I am a great believer in giving people the freedom to make decisions and take action without overwhelming pressure from nervous top-down management.

Indeed many wise business sages have expressed strong opinions that leaders should always appoint the best people possible and then get out of their way and let them get on with it, whatever “it” happens to be.

Easier said than done, of course, because two relevant words come to mind in the doing of it, those being “trust” and “threat”.

We can dispose pretty promptly of the threat connotation because if a leader truly thinks that an exceptional employee poses a threat on a personal or corporate basis then they need to indulge in a little self-examination.

Trust is an entirely different proposition. If a leader shows the courage to give people their heads and then lets them get on with it, then many outwardly confident characters can still suffer inward pangs of nervousness.

Time is, as they say, a great healer and time will usually exhibit results, positive or negative, that will confirm or deny the leader’s decision.

The trick is, of course, to shorten the time span to make sure that the time for any negative impact is as shortened as possible, and that is where accountability kicks in.

In essence accountability implies that while we have the freedom to make decisions and take action, we are always accountable for both decision and action that need to be for the greater good of the enterprise.

The difficulties now lie in the frequency, depth and hierarchical level to which people are accountable so that it does not become a wet blanket of authority.

It does seem obvious to say that if we rightly give our people freedom then they should be accountable and some individuals find this both scary and irksome. Consequently they can be identified as the people in the business who just need to be directed, told what to do and then get on and do it.

There is a danger, fed eagerly by the media, that accountability can be equated to dramatic failure and we then can get into a “heads must roll”  scenario.

The whole concept needs to be a part of the values and the culture of the business; we offer you trust and the freedom to do what you consider to be right and we expect that you will accept accountability for the outcome.

Aristotle said that excellence is not an act, it is a habit and he might well have substituted accountability for excellence. It is said also that when we have done something for thirty days it becomes a habit and I would suggest that this is the desired outcome anyway.

The real answer is to set up a process that is not irksome or seemingly investigative but one rather that eventually relies on self-motivation and self-accountability, in other words becomes a habit.

Eight plus years ago I was in a break-out group at a Vistage conference where we discussed accountability. Each of us decided on a regular action we would take and we would then be accountable to another member of the group. After four or so weeks I found that I was calling my colleague rather than being called.  

Self-motivation kicked, I found that I didn’t need to feel accountable or responsible for the blog, that I enjoyed the experience and now more than 450 posts later, I am still at it.  In other words it became a habit.

If we can set up a process in our business that delivers self- motivation and self-accountability as habits then we have a process that can only lead to growth and success and probably more satisfied employees.

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Sunday, 11 March 2018

Having Problems With Communications? Be Brave, Try Something Different!

Whenever a survey is taken of employee satisfaction it is strange to note how many comments are forthcoming about the perceived lack of communication in the business.  Paradoxically this complaint is being ventilated in a survey to uncover problems in communication.

I had a very interesting one-to-one this week with one of the members of my Vistage CEO peer group and we discussed this issue at length.

He is dedicated to doing as much as possible to enhance the level of effective communications to the employees of around 300 but has begun to realise that methods that worked at least on a satisfactory level now seem to have a reduced effect.

His overall theme was that as communication methods have changed then why are we still using old methods with noticeably less success.

Methods like noticeboards, an intranet, regular newsletters to everyone, briefing meetings, information campaigns, surveys and so on seem to have lost their effect.

We had a brilliant speaker from the USA, Herb Meyer, at a meeting of my group some time ago and he had been special counsel to the Director of the CIA so he had some some considerable experience of communications.

He said that if they needed to pass some extremely sensitive information this would be done by placing it in a locked box which was then transported in trusted hands to the recipient who then unlocked the box. Herb said that ten minutes later everyone in the building knew about it.

He went on to say, perhaps a little cynically, that the only way to make sure that it stayed secret was to put it on the noticeboard.  Question: how long is it since you have looked at your notice board?

The fact is that methods of communication have changed and are still changing dramatically and the question is, are we up to date with everything available that can be validly used in the business?

On a simple level we all see people in restaurants settle at the table then everyone gets out their phones and spend time gawping (my Lancashire background coming out) at them.

I find that habit objectionable but it happens and if people prefer to read news or check their emails constantly then that is their business.  The fact is that we may be missing a trick if we don’t exploit the habit in some way.

One method that I found out about only yesterday (I am not always an early adopter) is Facebook Workplace and that seems to me to be a very engaging way to encourage people to communicate more readily.

After all communication  to be effective must be at least two way.  The old technique employing a metaphorical pointing finger followed by “Do you understand?” has long gone or at least we hope so.

As far as possible the best way to pass on the message is individually and that can be complex in larger organisations where the message has to be delivered at all levels of the business. There is a consequent probability that it becomes garbled at some stage.

There cannot be too much communication but it is essential that the methods used ar acceptable to recipients  and are as little top-down as possible.

The old adage about “my door is always open” sounds great but it needs to be visible and individual to make it truly effective.  Think about some real differences that are exciting and try them out. Test them if necessary in a small pilot scheme and monitor the results.

There is no magic bullet but a constant drip feed of communication in ways that people understand and like can have a dramatic effect.  Perhaps it may even slow down the complaints in those employee surveys.

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Sunday, 4 March 2018

How Effective is Your Supply Chain? It's Vital For Your Gross Margin!

I posted a blog a couple of  weeks ago about the late Brian Warnes and his brilliant concept of Dynamic Budgeting.  He also introduced me to the 5-Line P&L, again a brilliant and simple concept.

During a recent one-to-one mentoring session with one of the members of my Vistage CEO peer group, we were discussing some instances of indifferent performance of their supply chain and it occurred to me that Brian’s 5-Line P&L might supply some form of solution.

If we analyse the P&L, Sales comprises Volume and Price and Cost of Sales is Labour and Materials.  This applies largely to a manufacturing businesses, of course.

We should always be aiming to increase the gross margin, the true income of the business so for a start let’s see how this can be achieved. Sales as we said comprises volume of product sold together with price.

Volume can and indeed should be affected by our sales and marketing procedures but can be seriously affected by competition.  

Please mote; competition is NOT restricted to price.  

There are many reasons why customers buy from us and price is frequently number 4 or 5 on the list below the product itself, quality, service and so on.

We do, however have control over the price for the product and on the basis of getting the basics right for a start, we should be able to increase prices.  Vistage speaker Malcolm Smith, for example, runs an excellent session called “It’s Not About The Price”.

If then we consider the cost of sales it usually comprises labour and materials with an adjustment, if required, for stock.

If we can’t or don’t want to reduce the labour cost, the spotlight falls inevitably on the materials component.

As a side issue it is interesting to do the 1% test on your 5-Line P&L because we don't always realise that tiny incremental changes can have a significant effect overall.  For example if the objective is to increase the gross margin, then we can increase sales, either by more volume or increased prices.  Do this by 1% which automatically increases cost of sales by 1% with fixed costs remaining the same.

If we then reduce costs by 1% and recalculate, just take a look at the effect on the net profit.  One of my members did the same exercise at 2% and he was astonished to find that it doubled the net profit.  Remember that even a 2% change should be relatively easy to achieve with a little imagination.

If we increase prices then the increase goes straight to the bottom line.  If we decrease the cost of sales, then the same applies so it seems sensible to concentrate on both of these factors.

Taking the cost of sales component, the part that needs to be considered is the materials costs.

My member discovered that the purchasing team, once they settled on a supplier then a certain amount of complacency set in and there was little examination as to how they could reduce the purchase costs other than by negotiation with one supplier.

There was some reluctance to look for alternative suppliers which immediately  raised concerns as to why this was the case.  For example, was it laziness or something more sinister?

He took the decision to insist with purchasing that for major supplies defined using Pareto Analysis (80% of all purchases result from 20% of suppliers) they were able to identify precisely where competition could be introduced.

The upshot of the exercise resulted in an overall 8% reduction in purchasing costs and a more active, competitive and responsive supply chain.

This is all very simple and I would be surprised if you are not working this yourself.  The question is: how effective is your purchasing and what could be achieved with a little more analytical activity and imagination?

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