Customer Loyalty

March 27, 2008

Decrease in unsatisifed customers?

I am sitting here watching the news (or what is supposed to be news) and keep hearing about this poll and that poll regarding the different presidential candidates.  It reminded me of this quote from Evan Esar,

"Statistics: the only science that enables different experts using the same figures to draw different conclusions."

While it is almost humorous to watch the political pollsters argue over a few percentage points, we don't have that type of latitude in our organizations.  Data is the lifeblood for making sound business decisions.  Decisions that could lead to business growth and job creation or decisions that could lead to business decline and headcount reductions.  The data needs to be accurate and precise, and communicated in a way that it clearly represents the facts (or true truth).

I once heard heard some analysts talking about increases in customer attrition rates and they jokingly defined it as "a decrease in unsatisfied customers".

Please be careful how you collect data and communicate information.

February 11, 2008

Create an Atmosphere of Innovation

In our ongoing series on business innovation, Clay Richardson and I just posted a new column on BP Trends.  In previous columns we explored creating value through customer-centric innovation and creating agility through disciplined, collaborative business process management (BPM).  This month we turn our attention to the human side of innovation and present a conversation about things you can begin doing today to  create an atmosphere of innovation in your organizations.

Read more about 1) stimulating creativity, 2) setting hilarious goals, 3) making your box bigger, and 4) executing faster...

We hope you enjoy the column.  Oh, and feel free to come back here and give us your thoughts.

October 12, 2007

Quality is Essential

McKinsey recently posted an interview (registration required) with Armand V. Feigenbaum, noted quality guru.  There are some good nuggets of knowledge in this short interview that marketing leaders should listen to as they consider implementing process improvement methods (especially Six Sigma) in marketing.

Some of his specific comments that are particularly important to marketers include:

"Improvements in quality lead to improvements throughout the organization.  Above all, quality must be understood as a management style, and an infrastructure has to exist that supports both the work quality of the individual and teamwork between departments."

"Some companies have an outdated idea of quality and how to improve it.  Managers think of quality as minimizing defects...This aspect has long been an entry-level requirement in competition, but is no longer enough from a customer perspective."

"Many companies don't understand that new market conditions require extensive changes in management methods."

Generally, here is my interpretation of these comments:

Screenshot017 There is consistency with with W. Edwards Deming's Chain Reaction that shows how improvements in quality lead ultimately lead to staying in business and providing more jobs.  Building quality has a flow through effect throughout the organization.  Quality is not necessarily a function or something that a "highly trained Six Sigma Black Belt" can do.  Quality is something that must be a part of the fabric of management, part of the company's DNA.  If you are establishing a quality program or effort in addition to your existing work (or creating special categories of leaders to review and approve projects), you are creating "shadow work structure" that is unsustainable and will ultimately collapse under it own weight.  Quality must be a part of everyone's job.  Not a special function.  If you are waiting for a Six Sigma Black Belt to come fix your processes, quit waiting.  Take ownership and start improving.  If you need a guide to get you going, check out The Improvement Guide.

System Be a Systems Thinker.  Too many people and companies try to work according to the organization chart.  This is not how work gets done.  Silos.  Barriers.  Frustration.  Politics.  Understand the white space.  Understand the processes.  Throw away the org chart and look at how work actually gets done in your company.  Look across business unit and function boundaries.  As marketers, we need to clearly understand the value chain so we can optimize how we go to market. 

Understand your company through the lens of your customers.  Quality of products is not enough.  Customers expect quality products.  What about their experiences?  How are you bringing customer knowledge back into your company?  How is it used?  How does it shape marketing?  Design customer experiences that expand their expectations.  How do you do it?  Quality.

Finally, as marketers, managers, and leaders in companies, we must always learn, grow, and improve our management methods.  Over the years, I have interacted with a variety of leaders that woke up one day and found their organizations being leap frogged in the market, backsliding, or stuck in a quagmire of operational ineffectiveness.  "We have always done it that way"..."We do it like this because we a different"..."our market is unique and we can't change it"..."we tried changing it once, but it did not work, so we went back to our old way"..."our industry is just too complicated for us to change"..."that would create too much pain in our company"...all words that lead to organization destruction and death.  Be willing to step out, test new ideas, try new concepts, reinvent some old ones.  Sitting still is sliding backwards.

June 27, 2007

Do Unto Others

In the past 16 years, I have owned 7 Hondas (4 Accords, 1 CRV, 1 Pilot, 1 Odyssey).  You would think I am loyal to Honda automobiles.  Actually, I am loyal to the service provided by John Eagle Honda...specifically, to the personal attention and service provided by Richard Rainoshek.  Richard takes a personal pride in his work and in the service he provides, one person at a time.  He makes me feel like I am his most important customer, takes time to explain things to me, and always has a friendly word and tone of voice.   I spent time watching him with other customers and he did the same thing with them!  It was awesome to see a "service master" at work.  For the few moments he was working with a customer he gave his full and undivided attention, connected with them personally, and left them with a sense that each one of them was important.

While the tone, processes, and policies of service delivery are set by John Eagle Honda (the company), it is delivered by the individuals that touch customers each day.  Richard lives and delivers service by "The Golden Rule".  It is not about just solving the problem, it is about making people feel important.

Because of the loyalty created by the service I receive at John Eagle Honda, I have influenced at least 4 Honda purchases by my family and friends.  Now, John Eagle Honda services Acuras.  Hmmm, so many choices?

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