Who Moved Your Cheese (Customers) ?

You need your customer more than they need you . Do you know this fact?  Many would reply – YES we know.

But real problem starts when we see our action  as far as customer experience is concerned. Our actions are not commensurate with the statement above.

How many companies have mission /vision statement?  Most company will answer in affirmative.

But again real problem starts once the statement is freezed and put up on website and reception area. Other than customers no one in the organisations reads and practice that.

How many of the entrepreneurs are aware that in an era of commoditisation of products and services , ease & delight in fulfilling customer needs is the real sustainable competitive advantage? Fair number of entrepreneurs have now started realising this.

But how many entrepreneurs have done anything to achieve this competitive advantage ?

Become your own customer – visit stores, call call centers , use after sales, talk to front line people , talk to back-end people (their action or inaction impact performance of front-line employees and customer experiences)  and realise – map competitive advantage your company enjoys.

Entrepreneurs and CEOs are talking & complaining about low sales, competitive pricing pressure, top-line growth issues, challenge of how to differentiate – but rare  number of entrepreneurs and CEOs are taking action in the space of bettering customer experience (CE) and most are just clueless , complaining and talking about ROI on customer experience initiatives.  

What is the ROI of life insurance policy? What is the ROI of medical treatment cost of a dying patient?  What is the ROI of cost of going to the Gym? No we do not see ROI on insurance policy or medical treatment as it is a MUST to protect our family from risk , survival or preventive health measures. CE initiatives are beyond ROI as these are MUST , not just to survive  but it is the cause of every business.It has to be a part of business strategy. (though ROI of better CE is obvious i.e. survival) 

Cheese has again moved and those focusing on bettering customer experience know who moved and how to remain with cheese , all remaining are questioning & complaining –  WHO MOVED MY CHEESE  (Customers) ?

Today's Organisations - Horses on Steroids

Present models of ONLY ROI driven businesses are not sustainable.  CFO of Narayana Hrudayalaya today quoted in ET- CD, " kind of returns PE players are asking is not possible in healthcare industry." 

Yes healthcare industry is not only PROFIT driven but PEOPLE driven. Number of people impacted while making some profit to take care of future investments. Mere ROI focus is not sustainable nor desirable.

Why only healthcare ? Every industry today is in severe cut throat competition. Ethical conduct is replaced by END only matters,  Q on Q and ROI, ROCE kind of performance matrix. 

Balance Scorecard approach by some of the corporate is welcome step but how much it has helped in stress reduction and happiness enhancement is a  matter of research. 

These PEs and their insatiable appetite for ROI is deciding ROI benchmarks world over.  

Huge ROI will drive happiness for a few at the cost of unhappiness and stress for many. 

Today's organisations are like Horses on steroids in race course. 

Huge bonus and extravagant packages at the top level makes the organisation look like a race course. Bets on the houses are so huge that they have to run and run and win at all cost. 

Fortunately horses run only in race course but ROI hungry Shareholders & CEOs run all across the society. Examples of Ranbaxys and Satyams and many more unearthed are the products of such rush for crazy ROIs.   

Why I lost my Customers ?

Recently a friend of mine told me that he has lost one of his customer for 9 years , for meager small price difference. 

All of us whether in business or profession face customer attrition. Yes they leave us. Those who are involved in customer acquisition know how difficult it is to get one. So many meetings , follow up , promises and discounts offers it takes to get a customer.

Therefore when we lose our customer its painful as well as loss making proposition. Retained customer is an income , acquired customer is an expense as it takes 5 to 7 times the money to acquire new customer than to retain a one. 

As the customer gets older cost of acquiring him gets written off over the period of time. It is always better and smarter to not only retain a customer but also get referral from him to get a new customer. 

A value of customer is = profit out of his repeat purchase + referral leads he offers (which saves 5 to 7 times of cost of acquiring a new customer) 

But if customer is so important to any businesses important question to think is why do businesses lose customers to competition ? 

1. - Better Price 
2. - Better Speed to Delivery
3. - Better Understanding of the customer
4. - Better Proximity
5. - Better Quality 

Most important are Better Relationship (Human aspect of dealing & not CRM) and Better Customer Experience (Emotional Connect). 

Sometime you may wonder why ever after focusing on the above 5 tangible aspects , your business is still losing customers ? 

It may ( MUST ) be because you are ignoring completely the two intangible but critical aspects of business - customer relationship and customer experience. 

Are you LIKABLE?

Are you as a person likable to fellow workers , fellow family members ? 

Are you as a company likable to employees , customers, suppliers, shareholders & community around ? 

People like to deal with what is likable. Therefore one of the parameters to evaluate the performance and target to be aim for is more likability. 

Impact being likable can have on individual and business is enormous. Sometimes its better   to evaluate this on unlikable parameters. 

Dave Kerpen author of the book Likable Business describes seven of the ten things in his presentation.  

• Listen - employees, customers and everyone 
• Surprise & Delight
• Story Telling 
• Transparency 
• Authenticity - Just be you 
• Team Play
• Gratefulness

Those who are further interested and have 55 minutes of time to invest may see this presentation by Dave Kerpen Video on How to be Likable Company

Social Media is either making companies aware why it is important to be likable or forcing them to react and change to become likable.  

Is your business making money?

Is your business making money? 

Answer may be NO but you may not KNOW. Yes many businesses are just managing cash flow and not making profit. 

Is it your money that you are splurging on ? 

It may be of your creditors or banks or government. 

Is your networth positive after you writes off dead stock , dead investments , difference between book value and scrap value of your assets and bad debts ? 

Is your ROI more than risk free rate market return ? 

You may have money in bank but do you have assets value more than your liabilities? 

Take a critical look at your MANAGED financials.You may cook the book to fool government and investors but be cautions about your uncooked real books that is fooling you and taking speedily you on the road to bankruptcy.   

Many companies survive before they burst merely on the basis of positive cash-flow. Cash flow is critical but at the same time it misleads. It makes us believe that our business is making money. But unless you are vigilant on the above aspects of profit and loss and Balance Sheet , only positive cash flow dependency can be a disaster.

First Impression is only the First Impression not the LAST

First impression is the last impression is highly overrated  and bias thinking. This mindset does not believe in any scope for improvements. 

Life is all about continues improvements and NO ONE can be perfect at the first time. We have in life and in business many instances of great first impression and lousy impressions thereafter and vice versa. 

Yes we have to give our best at the very first time but that is not all. We can always learn from mistakes, from others's experience , from customers feedback. First impression is not and can never be the last impression. 

Yes , not improving continuesly is a cause for concern. Worrying too much about the first impression will pull you back to create any impression at all.   

Try and create the great first impression and work to make it better at every next impressions. 

First is not the last , first is just the first. 

Lessons for Political Campaigners from Business Campaigners

When business campaigners i.e. advertisers talk they talk about qualities of their products and services and try to differentiate from the competition without referring to the bad qualities if any of the competitor. 

They don't criticize competition but communicates how they can make a difference in the lives of their users/consumers. 

Consumers by and large are smart and they know good and bad about the competing products. 

In contrast our political parties and leaders spent large part of their election speech in mud slinging on opposition and competitor.  Consumer & Voters wants to know HOW you are going to make a difference in their lives. They need your plan of action to bring the desired change, your case studies of past performance, your views on various problems and issues need resolution. 

Spending time on criticizing others is doing NO good to any one , neither to listeners nor to speakers. Leave listeners , views and voters to decide what is good for them without referring what is bad about your competitors. They just want your support in deciding in their selection and best way to do that is to demonstrate WHAT you can do to improve their lives. PERIOD.

Congress leaders going to Gujarat and doing negative campaign against the Govt will not work and similarly Modi going to Karnataka and do mud slinging against the Congress also will not work.

In Gujarat people know what Modi has done so they don't believe in Congress and in  Karnataka people are aware what BJP has done so they will not believe in negative campaign against Congress by Modi. In both campaigns parties had to demonstrate WHAT and HOW of changing lives for better of voters from present situation. Both have failed in that and so their campaigns have also failed. People are first interested in bettering their lives and they care about corruption only AFTER that.

Communication makes all the difference. FOCUS on positive campaigning.  Political campaigners may take some clue business campaigners. 

Leadership Vs Front-facing Candidates & Managers

Leaders can inspire but it is the local leader at  the voters touch points who can drives votes. Only leaders without right followers cant win elections. Mass leader with right candidate is the killer mix. 

Right Candidate (non corrupt , performing perception & great people skill)	Likely Win	Mostly Wins
Wrong Candidate (corrupt , non performing perception )	Mostly Loses	Likely Lose
Election Matrix (Qualities of candidates and leaders are in relation to its opponent)	Uninspiring  leader at the top ( Incapable, uninspiring, corrupt & ineffective & non inclusive image)	Inspiring Leader at the top ( Inspiring { thought leader , communicator} , capable, non corrupt, effective, executor, inclusive image  )

The above matrix is not only applicable to political parties  but also to all businesses. Howsoever strong leadership you may have at the top if your ground level customer focus managers are failing company will be in trouble.

People will become customers if they see Richard Bronson at the top but soon they will disappear if the touch point manager/staff is uninspiring.  Only dependency on right and inspiring leadership is not going to yield the desired result. 

Failed Communication !!!

I received birthday wishes from the only club I am a member of. I was pleased to see the envelope wishing me birthday in advance. 

When I further dwell into the communication my happiness doubled when I saw they will treat me with 1/2 kg of cake on that day. 

But ...

Yes there is a big BUT  towards the end. They asked me to intimate them in advance how many people will join me to a party which they assume I will offer on my birthday at their restaurant when they will serve me a free cake... 

I realised that this was not a birthday wish but only a sales letter in disguise. 

Companies must refrain their urge to sell every-time they communicate with customers. Sometimes a sincere wish can do wonders and more sales then these kind of letters. 

This letter at the end didn't serve any purpose. Birthday wish was to sell and sell will not happen when I see such selfish approach to wish me and lure me through 1/2 kg of cake.

Focus on genuine experience creation , genuine wish and then only genuine sales will happen automatically. Many a times focus on sales pitch is the reason for no sales. When  customers see ingenuity in communication and approach. 

Are you genuine when communicating with your customers? 

Are you balancing for ROI or overall HAPPINESS ?

My last post Is Balance Scorecard relevant today? received good response from practicing professionals in one voice they stated YES Balance Scorecard is and will always remain relevant. 

Balance Scorecard is relevant but what we are out to balance that need to change according the competitive business , social and environment land scape.

We can not have ROI only mindset to align all other balancing factors serving that. ROI at what social, ethical, emotional & environmental cost? Present balance scorecard do not takes into account these factors. 

After identifying all these stakeholders a balanced strategy to make all of them happy should be worked out. All of them deserves equal weightage. Thereafter further breaking down is to be done to achieve happiness of each of the constituents.     

In achieving only ROI based balancing other aspects like governance, ethical and socially responsible behaviors can & shall not be ignored. All these must be incorporated in overall balance card.

Is Balance Scorecard relevant today ?

Dr Robert Kaplan & Mr David Norton introduced powerful model of Balance Scorecard during the last decade of 20th Century. It clearly makes the organisational focus broader merely from financial focus.  Model has become successful and used by many organisations across the globe. Main tenet of the models are as under: 

1) Financial Perspective : To succeed financially how should we appear to our shareholders. What are our financial goals? 

2) Customer Perspective : To achieve financial goals what should be our customer strategy? 

3) Internal Perspective : To achieve our financial and customer goals what kind of business processes we must have? 

4) Growth and Learning Perspective : To remain competitive what kind of people competency we should have or develop?

It is working well for many organisations. However in changing times this balancing also should under go change. 

What are we aiming to balance through Balance Scorecard ? As can be seen from the tenet it is only and only about WHAT part of strategy. Again on top of the strategy it is  Financial Perspective and all other perspectives are serving the financial perspective. 

It has to change. Financial Perspective and WHAT part of the strategy is important However unless its HOW is defined with keeping in mind environmental effect of doing business , social & ethical behaviors and making all stake holders happier by rightful conduct , it fails to balance the society in which the business operates. 

We first need to think to balance the negative impact the business generates before we decides about balancing business strategy for self use. New tenet of balance scorecard should be as under: 

1) Happy Customers : How to make our customer happier when they are dealing with us ?

2) Happy Employees : How to make our employees who are working for us happier ?

3) Happy Community : How to conduct business with social commitment, ethical conduct with every stakeholder incl Govt.  ?

4) Happy Shareholders : Here financial, internal processes and learning & growth perspectives of existing Balance Scorecard can fit in.

Balance Scorecard in its existing form is missing some of the important balancing requirements.  

Do you think differently ? Please share your views. 

Financial Ratios - Outdated to measure SUCCESS

ROI, ROCE, EPS, PE, EBIDTA  all these words have assumed so much importance in business world that what it takes to achieve is completely ignored. Cost of achieving better and better these figures is so huge that it consumes humanity , environment , ethics and every other things. 

Capitalist society we are in has attached extreme importance to the figures/ratios stated above. All our business actions are only measured on these parameters.  There is no measurement of corrupt practices indulged , environment polluted , stress generated among people working for the organisation , customers fooled , under-served and even cheated to achieve these ratios. 

Single minded focus on financial ratios is killing the ethical and human factors in business. Growth at all cost is doing harm to the society and benefits handful of shareholders. We are talking about sustainable business practices  keeping environment in focus however what about sustainability of ethical norms human sustainability ?  

We have seen in the movie Guru , one company takes on the Govt rules by breaking and indulging in unethical practices. Who has authorised them?  What if every company start doing that? Just for personal gain ethical standards have been broken and justified for business & share holders wealth creation. We live by quoting that as an illustrious example. It is nothing but collapse of value system and unethical conduct for personal gain of a few. 

Just focus on financial success is the cause of all these nonsense prevailing in business world these days. There are a few companies like Zappos.com which make DELIVERING HAPPINESS as their business mission and not only financial ratios. We need more and more of such companies and rest assured in times to come these are the kind of companies which will be valued more than just financial ratio focused companies. Non manipulative and socially sustainable measures will be in demand, 

Any one of the Indian companies dare to do things differently ? 

Before Content Marketing Begins ............

There is lot of talk these days about power of content and digital marketing. Every business has sleeved up to delve into this new medium to lure customers.  Content and digital marketers busy in strategy making. Lots of buzz and all new excitement and hope. 

However in a hurry to get customers most businesses have forgotten to take first step in content/digital marketing.

Yes fundamental rule of content and digital marketing is one need to have product and service which is offering delightful customer experiences. Without first focusing on making experience delightful and impeccable , focusing merely on content/digital market can and will misfire. 

Going viral applies equally to great things as well as to not so great & rotten things. In a hurry to sale quickly and to take first mover advantage,  companies will damage its reputation miserably by jumping into content/digital marketing unplanned and without taking first step. 

Like any other marketing initiatives this new medium also requires great product and services capability to talk about. However not able to do so severely damages the brand and reputation unlike any other traditional medium. 

Even in his best selling book Platform author Michael Hyatt talks about creating compelling product/service in the first 7 chapters before he talks about Platform for the products in rest of the 53 chapters. 

Beware and become aware about this most important FIRST STEP.  

Don't care for customers ? Focus on Customer Experience !!

Even if you don't care for customers, offering delightful customer experience in times of 

social media and word of mouth marketing is even good business 

strategy.  It improves both - top and bottom lines.  

How to Create Word of Mouth Magic, in his blog author Dave Kerpen explains  with his real life experiences. 

Is Customer Experience on your business agenda at top management meetings? If not than your business is still struggling to know the purpose of its existence. Keep trying.  

WHY we MUST do the things for the FIRST time ?

WHY we MUST do the things for the FIRST time ? 

- It makes us believe that we can do it

- It enhances our confidence

- It makes us understand importance of team work

- It tells us how lousy it can be

- It enables people to give their feedback to improve it further 

- It also makes you stronger to digest negative comments and yet not give up

Most important lesson - It teaches us HOW NOT to do things for the 2nd time. This is very critical. 

Therefore  whatever you want to do , just do it for the first time asap. Just ship and deliver do not procrastinate or remain in self doubt. Learning will follow only after the FIRST Time. 

The First Question

The First Question

Customer Experience Management is the mother of all enterprise level initiatives like lean, six sigma, tqm, process engineering, business strategy, human resource etc all are in a way is impacting customer experience. Now if we consider Customer Experience as sustainable competitive advantage then all our initiatives should commence by keeping CE perspective at the center.

After the company decides about the products and services it is planning to offer to the market and geography it decides to operate in THE FIRST QUESTION to be asked is what kind of customer experience company wants to create for its customers.

There are nine leakage points which dilutes scintillating customer experience. Therefore unless customer experience statement is defined lens of the management will miss these leaky points.   In the process to answer the first question company will define customer experience statement.

Having defined the statement every action and initiatives will be aimed to achieve & maintain this statement. Budget for any initiatives will be viewed in terms of its impact on customer experience.

Every initiatives mentioned above will be to fix leakage in customer experience happening through leakage points;

• a) Leadership & Culture ( Culture & Governance Policies )
• b) Customer Strategy ( CE Statement & whether every other function align to this strategy? )  
• c) Customer Expectations ( tqm, lean, costing, innovation  )
• d) People ( HR )
• e) Process ( BPR, Lean, Six Sigma )
• f)  Marketing & Branding ( Marketing , Social Media, Advertising , PR )
• g) System ( IT, Technology, Mfg or Service Set up )
• h) Measurement ( right measurement matrix )
• i)  Distribution Channel ( distribution policy, training and hand holding )

When the above nine points are focused upon on a regular basis by keeping lens of customer experience on , company will then hardly needs any other area to focus upon ( ofcourse except taxation ).

Time has come for every organisation to ask the first question and realign to answer the first question. 

Brand is WHAT it does not how it looks and from where it comes

Ajit Pawar and Nitin Gadkari - the way they have responded in public during last few months shows how a brand can be ruined by its behavior.

Yes everyone of us are BRAND. We build our personal brands by our conduct. Not only the way we speak but what we speak, what we do , people we influence makes us brand.

In business sense its Customer Experience company creates that makes them BRAND and not advertisement , stationery, and logos.

Nana Patekar was on one of the TV show last week and he aptly said " importance of good looking Heros is just for 5 minutes, then public evaluates his Heroism by what he does on screen."

Same rule applies in the real world. One may be from big and rich family, holding big post and look handsome but WHAT he does with that will make him HERO i.e. Brand. 

Industry Associations - Change Objectives to Change Mindset

What are the role of Industry Associations? Are our associations living in previous century? Are our associations making their members ready for the future? Most Important what Industry Association thinks about customer they serve as Industry? 

I surveyed OBJECTIVES of some of the associations mainly servicing retail clients. These are Retailers Associations of India (RAI), Cellular Operators Association of India (COAI), Association of Healthcare Providers India (AHPI), Insurance Brokers Association of India (IBAI), Indian Bankers Association (IBA) & Maharashtra Chamber of Housing Industry (MCHI). 

Its is interesting to mention that:

1) IBAI has put up their memorandum of association to know the objectives.  We all know how the objectives of business is defined in the Memorandum of Association. Somewhere in About Us I found a para on objectives which talks about protecting the interest of members , interaction among members and educating the members etc. Nothing on code of conduct ,  ethics and values. 

2) IBA - None of the 19 objectives talks about customer service, satisfaction or customer experiences. One of the objectives though talks about - To project a good image of banking  as a service industry.  So no customer in sight and even focus is on projection of image not creation of Image. 

3) MCHI - None of the seven objectives talks about customer at all. Its all about their members. No responsibilities towards customers. Nothing on code of conduct ,  ethics and values. 

4) COAI - One of the objectives talks about - To undertake continues efforts for customer satisfaction. Nothing on code of conduct ,  ethics and values. 

5) AHPI - None of the 5 main objectives talks about customer service, satisfaction or experience. However there is a reference to the words like reach, affordability and safety of patients.  They did talk about ethical standards for members. 

One association which I found more proactive about the customers and ethics is RAI. Customers are the heart of any industry and business. Unless at association level customer culture is not talked about or kept at the center, members are likely to turn apathetic towards customer service and experience. Yes members for their owns sake are doing something for customer care and satisfaction but is it not the responsibly of every business association to percolate customer culture & ethical Behaviour in its stake holder members?

6) RAI - One of the 5 objectives states - To work for customer delight by helping retailers create the right retail environment.It also talks about transparency, code of conduct and right values. 

How far have they succeeded is a matter of debate. 

All associations are interested in expanding the reach, knowledge share, govt liaisening  in policy making. However unless associations focus on CUSTOMER their members are out to serve, associations will be failing in their role. 

I would like to end with the quote from the research report on Association Forecast 2012 by Shelly Alcorn who interviewed executives of 200 associations in the US. 

" During the course of conducting this project, we became convinced that associations are losing their ability to differentiate themselves in the marketplace, not because of a lack of innovation and creative capacity, but through a wholesale adoption of language and management techniques more suited to the purely corporate goal of product production, not experience creation. " 

Experience creation is the goal of every business and associations catering to any industry must keep this objectives at the center. They must enable their members in achieving better customer experience. Then and then they will align all other objectives to achieve this central objective. Market share growth , Govt policies,  best practice and networking  opportunities everything is secondary to better customer experience creating mindset and capability.  

Like a country where CITIZEN must be at the core of all activities , for any company and industry - CUSTOMERs have to be at the center stage. For Tarde & Industry Associations its members' end customers are the Customers.

  

" Brain Change not Brain Drain or Gain " Dr Sam Pitroda

Yesterday at one of the events in Mumbai Dr Sam Pitroda reaffirmed the need for 

re imagination. 

Some of his gems are :

1) Why do we need 4 years for a degree? Why not less ?  

2) Why do universities need land to set up university? Can it not be virtual and informal?

3) Soft skills (reading, writing, listening,collaborating with fellow students colleagues) is the basic skills without it hard skills cant reach its potential. Today's youth is lacking in soft skills. Universities and colleges MUST focus on that.  

4) Teachers should stop role of content creation and teaching , they must assume a role of mentors. 

5) Everyone has many ideas. Action is what we are lacking in. Only action-ing ideas will change the nation. 

6) Tod Fod Jod Centers at every school. Giving unwanted items like fan, PCs, mixers , grinders etc to students  to dismantle and fixing again. 

7) Young generation reflect , think and do things differently. Generation in power and administration will be failing in their duty if by their old mild set could not unleash potential of new generation.

They are at National Knowledge Commission and Public Info Infra, are doing some great work connecting Universities, Panchayats, small but basic innovations to change lives of small and medium manufacturers and farmers. 

Our newspapers and media are failing in their duty by not bringing these innovations and initiatives to the knowledge of public. Unfortunately crime and corporate news dominates the air time and page space. We need more and more of not only Dr Sam Pitrodas but also positive media.  

As aptly mentioned by Dr Pitroda, basic problem is not of brain drain or gain but major challenge is Brain Change. Fixed mindset is the challenge at all levels. It has to change first for everything else to change.