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Six Guidelines for Strategy Execution and Transformational Change

Take a look at just about any significant change initiative in customer service, CRM, marketing effectiveness, digital transformation, customer experience etc and you will find that the top barriers to successful implementation are do with lack of commitment from the Tops and ‘resistance to change’ from people within the organisation.

In the last post I shared David Maister’s assertion that our performance (individual, group, organisation) often does not improve because we are not willing to do what it takes over the time frame that it takes. Today, I share with you David’s insight into what it really takes to execute strategy, effect organisational change – which always involves personal change as well as organisational change.

This is a long post and I suggest that you read it only if you have an avid interest in strategy execution and/or transformational change. Or if you are wondering why it is that so few organisations have made the shift to being great with customers. And what it will take to make that shift.

Is the transition to customer-centric business like curing a fat smoker or helping an alcoholic recover?

It occurs to me that many organisations are addicted. What are they addicted to? I say they are addicted to a number of factors: a dominant ideology usually manifested in the business model; ‘bad profits’ – profits made at the expense of customers; a fixed way of being including policies, practices, and processes; the short-term fix etc.

In his book, Strategy And The Fat Smoker, David Maister says:

If all business improvement is like curing a fat smoker or helping an alcoholic recover, then what actually motivates people and organisations to change?

We all know the main thing that works: a major crisis! If revenues drop off sharply, it’s amazing how quickly businesses can act to deal with known inefficiencies and bad habits they could have tackled years ago.

… when the first heart attack comes, it’s amazing how many people suddenly find the self-discipline to start living right.

Does David Maister have any guidelines for us on how to effect personal-organisational change without waiting for that ‘heart attack’ to show up and force us to change? He does.

Six guidelines for strategy execution and transformational change

1. Get that it is about a permanent change in lifestyle

In my last post I mentioned that I worked for an organisation that carried out a quarterly NPS rain dance. Everyone went through the motions to get it out of the way quickly and get back to business as usual. To take it seriously, to do what was really necessary at levels-functions of the organisation showed up as being too much effort, too disruptive.

Here’s what David Maister says:

A major source of failure in implementing sensible business strategies is that we underestimate how much effort is truly required to bring about significant improvement.

Individuals and organisations frequently fail to incorporate the new activities into their daily lives. Strategic actions are viewed as special, separate events rather than regular business activities. In other words, there’s real life, and then there’s the diet.

It is about routines , not special events. 

My experience since 1999, working on helping organisations shift towards a customer-centric way of doing business, including smarter marketing-selling-service, resonates with David’s words. The customer centric orientation has to be weaved into the very fabric of the organisation through it daily practices  – routines – such that these practices become so taken for granted that they become invisible.

2. You must change the scorecards

There is a world of difference between playing a game where one has no skin in the game. And playing a game where one has something that really matters (like one’s reputation or wellbeing) is at stake in the game.  Let’s listen to David Maister:

If strategy is to be lived and achieved, it must be publicly tracked, measured and monitored.

We all forgive ourselves too easily. We all find it quite easy to live with guilt. Even a high level of guilt doesn’t always change people. However, embarrassment, even in small doses, can be far more effective.

3. Leadership: get serious or get out of the way

One of my biggest issues with the whole customer bandwagon and business advice in general is that it panders to the Tops and Middles. That is to say the hidden assumption (which serves the interest of those seeking to sell to the Tops and Middles) is that Tops and Middles are perfect – do not need to change their way of showing up in the organisation. And the only obstacles to strategy execution, organisational change, and customer-centricity, are the  Bottoms.  What does David Maister say given that he has had lots of experience working with the Tops:

Organisations often rush to figure out how the troops need to change in order to live the new standards. However, this is not the first task.

If an organisation’s leaders want their people to believe that a new strategy is being followed, they must establish credibility by proving that they are prepared to change themselves: how they act, measure, and reward. 

David Maister goes on to say that he can share countless examples of “failure to do this”.  And gives a great  example of the instructions he received from senior management prior to running training for managers in the company:

“Please don’t raise the topic of how we ourselves manage these middle managers. We’re not ready to discuss the terrible job we do at that. Keep their attention on what they could do better. We want them to change first.”

4. Principles are more effective than tactics

One of my biggest issues with the whole Customer (service, CRM, VoC, customer experience, loyalty etc) conversation is that it shows up for me as just tactics.  That is to say that under all the hype and ideology of customer-centricity and employee engagement there lies a selfish concern with interests of the enterprise: the realm of expediency not principle.  What light does David Maister shed on this?

.. successful implementation of a strategy requires both sustained commitment over time and broad participation across the whole organisation. Strategies in business, like diets and alcohol recovery, are implemented much more effectively when the ideas are presented as matters of principle, not just as matters of expediency. 

If strategic rules are justified only in terms of outcomes … the diet will always be seen as a punishment on the way to an uncertain and possibly unattainable reward…

If … diet achieves the force of moral principle (“Treating clients and employees with respect is the right thing to do”), the odds are significantly higher that successful implementation will be achieved.  

Managers who get things done are people who are viewed as having an ideology. Their people believe that they believe in something …. buy-in and excellent implementation result from a sense of not wanting to let people down.

5. People must volunteer

Looking into and beyond the whole field of change management and what do you see? I see that it exists to deal with ‘resistance to change’. How successful is the change management industry when it comes to dealing with ‘resistance to change’? I say that it’s effectiveness is questionable. What advice does David Maister have for us?

To achieve any goal, you must really want the goal.

A self-improvement program is successful and sustainable only when the individual chooses to to it for himself … The motivations must be intrinsic, because the essence of successful strategic change is not technique, but will …….. you can call it determination. 

.. the single biggest barrier to making change is the feeling that “it’s OK so far.” People don’t disagree that the future state of being a nonsmoker would be beneficial, but they resist when they are told that they have to do it.

One of the leader’s roles is to act as a coach, drawing people’s attention to imperfections in the status quo .… asking whether things could actually be better, and questioning whether the desired change is both achievable and desirable…..

6. People must get on or off the bus

If “people must volunteer” showed up as being naive and idealistic for you then this guideline is likely to speak to your concern. David has keen sense of the pragmatic:

Every individual can, and must make a personal choice. But then the organisation must decide how to respond to those individual choices. For an organisation, strategy cannot be what “most of us, most of the time” do.

As all married people who diet know, it’s hard enough to stay the course and resist temptation when you are both attempting to do the right thing. It’s well nigh impossible if those around you continue to indulge and tempt you with food, alcohol etc.

we cannot force others to do what we want. We can … protect those who have chosen to participate; doing so may require ridding the firm of those who refuse to come on board.

People have a desperate need for the mutual support …. that comes from joining in a common cause. The need to help each other through the tough times … instead of being part of a forgiving culture that keeps discouraging extra effort (“Oh, that’s OK, you can skip exercise today. You deserve a break.”).

Final words of advice on managing the process of change

It occurs to me that too many Tops and Bottoms live in the world of McDonald’s. They decide that they want to improve customer service, focus on the customer experience, build stronger relationships, generate growth through effective use of digital technologies etc – and they want it NOW!

Here’s David Maister’s sage advice based on lived, first hand, experience of making-sustaining transformational change:

Like alcoholic recovery, it is a process that requires you first to make a lifetime commitment, and then you take it one day at a time.

The key is to manage with a philosophy of “It’s OK to stumble; it’s only a sin if you don’t get back on the program.” The primary goal of the beginning stage of a change program is to get people to believe that it is doable and that all we are asking is that they try.  This means early successes.

All that wise leader …. talk about is the next step. And they enthusiastically celebrate each small accomplishment. They focus on requiring improvement, not on requiring excellence

Managing a weight loss program means you stop talking about the ultimate goal….. if someone says to me: “Let’s focus on losing one pound in a week, David. Do you think you can do that? That doesn’t sound impossible, does it?”

Good trainers know that life-changing improvements can and does fail by rushing to either of two extremes. The first extreme establishes overtly ambitious or time-consuming improvement goals, leading to frustration and abandonment of the program. The other extreme fails to establish any pressure to improve, allowing people to pretend they plan to get on the plan, but not just today.

Shiny Objects and Stupid Practices Won’t Make You a Customer Loyalty Leader

Imagine coming across a car that grabs your attention – in particular you are taken with the handling and performance of the car.  So you take a look at this car and identify the features that contribute to or help shape the performance of this car.  Having done so, you set about adding those features – bigger tyres, different exhaust system, different engine – to your car. How likely is it that you car will generate the kind of performance that you are after?  How likely is it that your car won’t even start and if it does the performance will be less than it was before you added the ‘shiny objects’?

Given that so few of us would be this stupid in the domain of cars why is it that so many are this stupid when it comes to the organisational domain?  Why is it that so many organisational people take ‘shiny objects’ or ‘best practices’ and start adding them to their organisation in the expectation that they will replicate the success of high performing organisations?

Can you take this cherry picking approach to Customer Experience and customer loyalty? Can you just tack on a veneer of Customer Experience to your organisation and thus cultivate customer loyalty? Can you tack some Customer Experience ‘shiny objects’ (almost always these involve technology) and ‘best practices’, here and there in your organisation, and reap the benefits that come with a loyal customer base?  No!

I want to take you back to 1993 and the wise word of Frederick Reichheld:

Building a highly loyal customer base cannot be done as an add-on. It must be integral to a company’s basic business strategy. Loyalty leaders like MBNA are successful because they have designed their entire business systems around customer loyalty. They recognize that customer loyalty is earned by consistently delivering superior value ….. Designing and managing this self-reinforcing system is the key to achieving outstanding customer loyalty.

When a company consistently delivers superior value and wins customer loyalty, market share and revenues go up, and the cost of acquiring and serving customers goes down. Although the additional profits allow the company to invest in new activities that enhance value and increase the appeal to customers, strengthening loyalty generally is not a matter of simply cutting prices or adding product features. The better economics mean the company can pay workers better, which sets off a whole chain of events. Increased pay boosts employee morale and commitment; as employees stay longer, their productivity rises and training costs fall; employees’ overall job satisfaction, combined with their knowledge and experience, leads to better service to customers; customers are then more inclined to stay loyal to the company; and as the best customers and employees become part of the loyalty- based system, competitors are inevitably left to survive with less desirable customers and less talented employees.

Does Leadership Effectiveness Start With Deep Listening?

Where the truth is self is not.

Where you are the other is not.

- Krishnamurti

Most of us are poor listeners, self included. And it occurs to me that the people who really excel at being poor listeners are those who hold positions of power in organisations.

How many decisions are made without the right people – those who have some kind of stake in the matter at hand – being in the room to discuss the matter? Even when the right people are present, I notice how quickly we dismiss the voices around the table that put forth a view of reality that differs from that of the powerful, or the dominant narrative.

I say that we should not stop at listening to the voice of the customer. I say we should listen also to the voice of the employees. I say that we should listen to the voice of the ‘whole system’ – all the stakeholders – when we explore matters, make decisions, and take action. Why?

What each of us believes to be true simply reflects our views about reality. When reality changes and when we ignore competing realities, if we dig in our heels regarding a familiar or favoured reality, we may fail. Perhaps what we thought was the truth is no longer the truth in today’s environment.

Multiple, competing realities existing simultaneously: This is true and this is true and this is true…… If we entertain multiple realities, we create possibilities that did not exist for us before. 

We are more likely to discover the truth we most need to understand today by demonstrating that everyone has a place at the corporate table. That all voices are welcome. That no matter what our area of expertise, each of us has insights and ideas about other aspects of the organisation..

…until the multiple – sometimes conflicting – realities of key individuals and constituents have been explored, implementing a plan can be decidedly tentative endeavour. To the degree that you resist or disallow the exploration of difficult realities in your workplace …., you will spend time, money, energy, and emotion cleaning up the aftermath of plans quietly but effectively torpedoed by individuals who resent the fact that their experience, opinions, and strongly held beliefs are apparently of little interest to the organisation.

- Susan Scott, Fierce Conversations

 

Is This The Answer to Collaboration, Creativity, and Innovation?

I met up with a ex-colleague today who is passionate about customers, about service, and about the customer experience. He showed me the NPS charts and figures and lamented that so little real change is occurring in the organisation and so the NPS scores are static. He even went to a call-centre, sat with call-centre agents, and observed them responding to customer calls.

What did he notice? He noticed that these agents were not picking up on the customer’s emotional state and responding creatively to generate a meaningful connection. They were too busy on the task of working many screens-systems, finding information, and relaying this information to customers.  He noticed that the call-centre agents were going about their customer conversations (and work) in a robotic way. I detected a hint of complaint towards the call-centre agents.

This got me thinking about organisations and work places. In my 20+ years of experiences I have worked with-for many organisations and I have noticed that most organisations are dead. Only a handful of organisational environments are alive. I have also noticed that robotic behaviour and dead organisations go together. Have you noticed that when people finish work and leave the building they sigh with relief – relief that they are out of prison. Have you experienced the same?

I ask you how likely is it that collaboration will show up in dead organisational environments? How likely is it that creativity and innovation will show up? How likely is it that the people working in dead organisational environments will show up in a way that leaves customers feeling happy?

Which begs the question, how do we turn dead organisations into alive organisations where empathy, collaboration, connection, creativity and innovation flourish?  I have noticed the there are plenty of people providing answers to collaboration, creativity, innovation and employee engagement. There are all kinds of tip, tricks, techniques and frameworks – some simple, most complex. If they worked then collaboration, creativity, innovation and employee engagement would be flourishing; the tips, tricks, techniques, and frameworks have been around for a long time.

So what is the answer to this riddle? How do we turn dead organisations to organisations that are alive with empathy, with collaboration, with creativity and innovation? I share with you a profound insight, from a radical thinker, that gets to the heart of the matter:

People who are without creativity build dead organisations.

- Krishnamurti

 

How Well Are You Positioned to Make The Shift to Being a “Customer Company”? Answer these 10 Questions to Find Out

It takes something to run a marathon.  It takes something to orient your organisation around the customer.  It takes something to be a “Customer Company”.  And it takes a lot more than technology or changing some processes here an there.

What does it takes to be a “Customer Company”?  It takes passion.  It takes steadfast commitment. This passion and commitment has to reside in the hearts of your senior management (“Tops”). And this passion and commitment has to be visible and experienced throughout your organisation.

Why does it take this level of passion and commitment from your Tops?  Because an authentic shift toward customer-centricity requires changes at multiple levels: priorities, policies, practices, processes, people, and platforms. This kind and scale of change only occurs when there is genuine passion, commitment and leadership from the people at the very top of your organisation.

How can you work out if the Tops in your organisation have this kind of passion and commitment to creating a “Customer Company”?  There are dreams. There are intentions. There are fine sounding words. And then there is how people show up in the world: their being and their doing. Which is my way of saying that you should pay attention to how people show up in the world, not what they say.  With that in mind, I propose that you ask yourself the following questions:

1. Do the Tops know how many customers we have gained over the last month, how many we have lost, and the impact on our business?

2. How much time and effort did the Tops expend last month serving our existing customers – in the stores, in the call-centres etc?

3. What actions have the Tops taken, over the last month, to walk in the shoes of our customers? Have they bought one of our products? Have they attempted to assemble-use our product? Have they called customer services to return a product? Have they read our marketing literature etc?

4. When was the last time the Tops called our customers to thank them and learn what enticed them to choose us over our competitors?

5. When was the last time the Tops rang up customers who have chosen to stop doing business with us to find out what caused them to leave us?  And what it will take to win them back?

6. When was the last time that the Tops met with a cross-section of our frontline people, individually and/or collectively, to get access to their experience and their thoughts on what is and is not working for them, for our customers? Is this type of meeting a regular event or a one-off?

7. Have the Tops ever been undercover to experience the reality of being on the frontline?

8. Do the Tops know how many of our frontline employees have left us, why, and the impact of this turnover on our customers, and our business?

9. How much time do the Tops devote per week, per month, per quarter on discussing what they have learned/experienced by talking with our customers, and our frontline employees?

10. What changes are the Tops making in terms of priorities, policies, practices, processes, people and platforms?

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