It was midday. The phone rang in my office. A man at the other end of the line was highly agitated and loud.
"Your delivery person just KNOCKED DOWN my STONE WALL! I just had the thing built! What are you going to do about it???"
I'll admit that - for a moment - I was disoriented by the call. We were delivering office supplies to businesses, not homes. Our trucks had no reason to go into residential neighborhoods. And yet it was my truck. At someone's house. Knocking down a stone wall?
"May I speak to my driver, please?"
The young man got on the line. He sounded embarrassed.
"Sorry, Alan. I got lost on my way to a delivery, and I tried to turn around in this man's driveway. I accidentally hit his wall."
"Is there a lot of damage?"
"Yes - you should come out here."
I drove out to a manicured suburban neighborhood, Big lawns. Pretty houses. And there was our office supply delivery truck parked in the driveway of the nicest house on the block. A white haired home owner standing next to my driver - visibly upset.
And 120 feet of new, beautifully built stone wall, curving along the edge of the street - lying flat on its face!! The entire 120 feet of wall looking as though it had keeled over!
I was astonished.
"How could you have knocked down the ENTIRE wall?" I said to the driver.
"When I backed in, my rear bumper hooked under the first stone at the beginning of the wall, and when I pulled forward, the whole thing went down like a set of dominoes!"
We took pride in our company. We held ourselves accountable for the things that went wrong. We didn't demean our employees or blame them for honest mistakes. We made good on that wall - we paid to have it rebuilt.
And we stood by that driver. After all, he did a good job and represented the company very well - when he wasn't destroying private property!
Managing a Service Crisis Properly
Eighty-five percent.
Eighty-five out of a hundred.
That is the number of customers (according to Accenture) who say that they would have stayed with their vendor if – during a service crisis - the vendor had simply responded.
That’s correct! Simply responded!!
Most customers – even if they experience a service failure when doing business with you – will not move their business to a competitor if you and your employees simply respond and promptly fix the issue.
Given how difficult and expensive it can be to acquire new clients, it is vitally important to manage a service crisis properly. No matter what your company does – retail, distribution, professional services, manufacturing - there are several key facets to an effective management response to a service crisis:
1. Fix the problem as rapidly as possible. Not tomorrow. Not next week. Now. As soon as the complaint comes in, your operation needs to be all over it. It really doesn’t matter whether it was a missed delivery, a backorder that shouldn’t have happened, a broken commitment, an invoicing error, a negative interaction with a company representative – whatever category of service failure has occurred, it can be solved and you need to energetically demonstrate your “rapid response” capabilities to your customer. (Obviously, a very customer focused and service oriented company culture is a prerequisite to being able to respond this quickly.)
2. Communicate, communicate, communicate. In my experience, customer patience with (and tolerance for) failure increases dramatically when the vendor communicates clearly throughout the crisis. The vendor must provide frequent status updates on the corrective actions that are being undertaken. Most customers do not expect perfection at all times from their vendors, but they do expect to be treated like a valued client when something goes wrong.
And as you or your employees communicate with the customer during a service crisis, be absolutely certain to make it clear that your company is holding itself fully accountable for the failure and that appropriate steps are being taken to prevent a reoccurrence. These commitments to the client should come directly from the owner or senior management.
3. Once the issue is resolved, close the loop with the client. If the service failure was severe, it is more than appropriate to recap the entire incident in writing with the customer. The recap should include a description of what happened, why it happened, an apology, and steps being taken to prevent future failures. A very effective strategy – if you can make it happen – is to deliver this recap in person. Customers respect owners and managers who demonstrate that they take service quality very seriously.
4. Debrief. The military uses debrief meetings to drive continuous improvement. You should do the same. Once the client has been satisfied and the crisis has passed, pull your team together and conduct a highly structured debrief. You need to determine what it was – specifically – that caused the failure. You need to determine whether it was an isolated incident or a symptom of an underlying operational weakness. Accountability needs to be determined and dealt with appropriately – and that includes the boss! A good debrief is not a witch hunt and it is not an exercise in assigning blame. It is a fair, even handed process that helps to diagnose why the organization failed and how future failure can be avoided.
Remember – 85% of those customers who leave because of a service failure would have stayed if someone has responded!!
Politics - The Scourge of Business!
Culture is destiny is business. All you have to do is think about the companies that you know (or you’ve read about) that have a culture of profit above all, greed, indifference (to both customers and employees) and you can clearly see that culture is destiny. Sooner or later, a bad culture manifests itself in bad results and a failing enterprise.
What’s your culture? What are your office politics?
Let’s hope that that you are not observing any of the following scourges in your business:
The Emperor’s New Clothes
This very common political situation arises in companies in which the leaders are feared. Even though the employees can see that there are problems with the organization, they will not reveal their thoughts to the owners. In fact, they will typically tell their bosses whatever they think the bosses want to hear – which is obviously not where you want to be! The best way to avoid this phenomenon is to project openness, fairness, and empathy in all your dealings with people – both internal and external. When you are perceived as approachable and fair and a good listener, your employees and customers will feel comfortable being straight with you.
Gossip
Office gossip is corrosive. It’s destructive. It’s a huge waste of time and results in loss of productivity.
Managing this common form of organizational politics is challenging. Leadership should model the desired behavior by being consistently careful to avoid talking about others in the organization. At the vey least, the owners or managers – through their daily conduct – should be setting the tone: “We are a professional organization; we focus on our customers, sound business practices, and proper treatment of others. Gossip is not welcome here.”
If that tone is not set, gossip will exist. Guaranteed.
Backstabbing, Undermining Peers, Cutthroat Actions
There are many ambitious business people who think that undermining colleagues is a legitimate way to get ahead. In fact, if the political situation in the business is such that the backstabbing appears to result in a positive outcome for the perpetrator, then you’ve got a real tough political situation on your hands. There are several positive steps that can be taken to keep this undesirable behavior out of your organization, including: a) avoid hiring the backstabbers in the first place! b) when you see it manifesting itself, move swiftly! Make it explicitly clear that this sort of behavior is not tolerated in your business; c) foster a culture in which team work and collaboration is rewarded rather than aggressive behavior and backstabbing.
Working in Isolation
Politics percolating through a business organization inevitably creates barriers to communication. Without sound, consistent and effective communication, people end up working in isolation from one another. In the worst cases the company devolves into a collection of silos, isolated from each other by politics and a toxic culture.
The solution is simple – management has to break down the barriers to communication, foster teamwork and the free exchange of information, and guard against the “us and them” mentality that thrives in highly politicized offices.
Office politics is a scourge! Is has no place in your thriving business!
How NOT to Manage Customers!
There are more than 30 million businesses in the United States alone. All over the planet, business transactions are as common as speaking and breathing. Everyone conducts some sort of business every day, all over the world. So, why does managing customer relationships continue to be such a challenging area for so many of us?
In far too many instances:
• We don’t treat our customers with deference and respect.
• We are slow to respond to people who are literally trying to put money in our hands.
• We are not consistently striving for excellence in servicing our customers.
• We are not fully engaged with our customers.
• We do not listen to our customers carefully – and empathetically.
• We take loyal customers for granted.
In my opinion, it is the culture of an organization that determines whether or not that business does a high quality job taking care of its customers. Companies that are striving hard to take proper care of customers exhibit characteristics and core values such as integrity, empathy, consistent focus on and engagement with clients, responsiveness, and, in general, a service mindset.
Companies where taking proper care of customers is NOT a core value will typically exhibit cultural traits such as “profit above all,” cynicism, expedience, viewing some customers as adversaries, and – in the worst cases – outright dishonesty and contempt for the customer base! Sad to say, those cultures do exist, and I’d venture to say that we’ve all encountered them.
If you want to avoid being one of “those” companies, you should aim very high in your customer relationship management efforts. Your actions – day by day – will determine your culture, which in turn will drive your service quality and the customer experience. Through your actions and your leadership, you should strive to achieve what I call “Trust and Respect” with your clients. If they genuinely trust you and respect you (not just buy things from you!) the result will be a strong and healthy business.
This chart shows common sense actions that you can take when you interact with your customers, and the response that these actions typically engender:
- Do What You Say You are Going to Do - Consistently - Creates Trust
- Listen - Engenders Respect
- Be Proactive - Surprises them! And creates Trust
- Know Each Customer’s Needs Thoroughly - Engenders Respect
- Pay Attention to the Details - Inevitably creates Trust
- Make Certain Your Employees are Knowledgeable - Well trained employees engender Respect
- Be Meticulously Honest - the fast path to Trust
Entrepreneurship is a hard, challenging way to make a living. You do want all that effort and stress to pay off, correct? Then, be certain to AIM HIGH in managing those customer relationships!
Customer Facing Employees - Managing your Front Line
Customer facing employees – in most companies they are called Account Managers or Account Executives – are among the most important employees on the payroll. The selection and training of these folks – the people who are projecting the image of your organization into the marketplace – day in and day out – is one of the most critical organizational development tasks for owners and leaders.
And yet, when you meet many of these key customer facing individuals - the people who have the power to make or break, grow or erode the customer base that you have all worked so very hard to create – these employees are lacking in many of the essentials skills that they need to be successful. For many companies, the selection of Account Managers or Account Executives seems to be haphazard at best. How else to explain the woefully underprepared, poorly trained, and “underwhelming” folks who are out there calling on and servicing customers?
There are a number of key traits and skills to look for when hiring account managers, and, in addition, there are a number of key areas of coaching, mentoring, and accountability that need to be in place once they’re hired:
Key Traits and Skills – Account Managers and Account Executives
Strong Communication Skills, Both Written and Verbal
A strong, effective Account Manager absolutely must be a good communicator. They have to be verbally adept, quick thinkers who are fast on their feet and can quickly adapt to both positive and negative client interactions. Imagine having an Account Manager who, when placed under a little business pressure, is unable to use their communication skills to manage that client conversation effectively, and to steer the outcome of the meeting to one that strengthens the relationship and preserves the credibility of your enterprise.
Folks without topnotch communication skills should NOT be working in customer facing roles.
Strong Organizational Skills and High Attention to Detail
Servicing a good size book of business is demanding and complex. Prompt follow -up, consistently keeping promises and fulfilling commitments, managing a busy calendar of appointments to drive efficiency and cost effectiveness while at the same time maintaining high levels of customer satisfaction – these are not things that a person with poor organizational skills or low attention to detail is going to be able to do. Be sure to test for these skills prior to awarding an Account Manager role to a prospective candidate.
Empathy, and A High Emotional IQ
Account management is – at its heart – people management. You want your customer facing employees to be able to swiftly intuit what’s happening over on the other side of that conference table – even if the signals coming from the client are subtle. Good Account Managers are empathic – they pick up on shifting dynamics within the business relationship because they can see it and sense it happening! Red flags don’t get past the skilled Account Manager. They seldom commit the errors of omission that bring down so many previously healthy account relationships. They react swiftly to changes in client contacts, client senior management, mergers or acquisitions and so forth – they don’t fall asleep at the switch.
The Ability to Build Trust and Respect with Operations
One of the most common weaknesses of businesses – any business, any industry – is tension, miscommunication or downright hostility between the customer facing employees and the operation. A good Account Manager is skilled at building trust and respect with employees and supervisors of the operational side of the enterprise. They are careful to treat operational employees respectfully, solicit their input when making service promises to customers, and keep the operation apprised of important developments and changes within their book of business. There should be very little daylight between the Account Managers or Sales and the company operation!
Key Areas of Coaching, Mentoring, and Accountability for Account Managers
Accountability for Strong, Common Sense Relationship Management Strategies
Frequently, Account Managers or Account Executives who possess the personal skills noted above will nevertheless need help developing effective client relationship management strategies. This is where leadership and management – who are typically a few steps further away from the day- to - day, can add a lot of value by coaching the Account Manager on the details of a sound relationship management plan. Leadership can mentor the Account Manager in areas such as:
• Are we at the right levels in the customer organization? If not, what’s our strategy for getting there?
• What are the current trends with the client’s business? Do the trends identified create additional opportunity for us? Conversely, do the trends threaten our tenure at the account? Do we thoroughly understand the client’s business goals and how well our services do or do not meet their expectations?
• Is the contract status at the account being monitored closely? Are we planning to initiate contract renewal negotiations comfortably ahead of time – in order to keep the business from “going out to bid?”
• What is level of communication between our company and the customer? Are we sponsoring regular, well-structured account review meetings? If not, why not?
Invest the time and attention that it takes to have the best possible customer facing employees. There are few things more important that you can do for your business!
Catch Them Doing Things Right for a Change!
Why do so many managers spend so much of their time trying to catch people doing things wrong? Why do so many managers have so little faith in their direct reports that they seem to always expect the worst from them? How about catching people doing things right for a change?
When an employee is on the receiving end of positive feedback, it encourages the employee to repeat whatever it was the elicited the positive feedback. As a manager or business owner - you can take that aspect of human behavior to the bank. But if you want to make a habit of “catching people doing things right,” you will have to be certain that it is well executed and well delivered.
There are several key aspects about catching people doing things right that you need to know. First of all, catching people doing things right has to be timely. When you observe the correct behavior – in other words, when you see the behavior that’s adding value – act.
Be sincere. Positive reinforcement that comes across as insincere or superficial is not effective. I once had a supervisor on my team who would blurt out “You’re the best!” to employees almost every day and in almost any type of interaction. The most common reaction he got to that statement was an eye roll! The praise wasn’t sincere, and his direct reports knew it. Instead of increasing their respect for him, his glib, insincere feedback actually diminished his stature in their eyes.
Be specific. Explain why the “good stuff” that you just caught and reinforced is contributing to the organization in a material way. Imagine you are a customer service rep handling a challenging client on the phone. As you hang up from this stressful interaction, your boss approaches you and says “You know, Bill, the manner in which you just handled that customer call was just about perfect! You maintained your professionalism, you didn’t get flustered, you projected a great image for both yourself and the company, solved the problem, and probably kept us from losing a valuable customer. Thank you!”
Time required to deliver that timely, specific, and meaningful feedback? Less than 30 seconds. Length of time the employee will remember that feedback and continue to be inspired by it? Weeks!
Make “catching people doing things right” a part of your managerial culture. Make it an integral part of the environment that you as a leader create every working day. And strive to eradicate the incidences of blame.
The odd thing about the opposite approach? Catching people doing things wrong? It doesn’t work. It doesn’t increase accountability. It doesn’t strengthen your business. It doesn’t improve levels of client satisfaction or sales or growth.
It demonstrates contempt.
It creates fear.
It creates a culture of blame.
Catching people doing things wrong is easy. Catching people doing things right, and doing that properly and effectively, can be challenging and difficult.
And that’s exactly why – as a true leader – you need to do it every single day.