Focus on the Fundamentals

During the past 21 years…

CEO of two large companies

Owned four small businesses

Read a minimum of 100 business books a year,

every single year!

A few of my clients:

What does this mean to me?

How can I use this idea?

What can I do right away?

The Four – I’s

• Ignorance• Inflexibility• Indifference• Inconsistency

How to avoid the Four I’s

• Aggressive external market focus.

• Ridiculously high level of customer focus.

• Keep the “Main Things” the main things.

• Bullish on knowledge sharing and learning.

• Teamwork / communication is mandatory – not optional

• Passion and commitment at all levels.

• Foster a healthy paranoia.

• Revel in change.

The Pattern of Business Success

(T + C + ECF) x DE = Success

Talent

Talent + Culture

Cecil Van Tuyl

“It is all about people, people, people. You can kid yourself about a lot of things in your business, but at the end of the day it will always come down to people.”

Best Practices: Talent• Create a pipeline of talent into your

company.

• Hire for attitude – train for skills.

• Use team interviewing.

• Train people how to interview.

• Use a focused competency model.

• Use numerous types of testing.

• Do a thorough reference check.

• Make sure they really want to work for you.

• Hire slow – fire fast.Make “Hiring Right” a core competency!

The level of highly satisfied and engaged EMPLOYEES in your business.

The number one factor in increasing the level of highly satisfied and engaged CUSTOMERS in your business is…

Job + Organizational Engagement = Employee Engagement

Not Engaged Engaged

En

gag

ed

Not

En

gag

ed

Job Engagement

Org

an

izat

ion

al E

nga

gem

en

t

50%

9%

Benchwarmers

7%

Free Agents

34%

Stars

Disengaged

Actively Disengaged Employees…

22%

Key Drivers of Customer Satisfaction and Loyalty

Financial Performance

Quality P&S&

Customer Relationship

EmployeeSatisfaction

Empowerment High Standards

Long-termOrientation

Enthusiasm, Commitment,

Respect

Training &Development

Fair Compensatio

n

CR= 104.12% increase in profits

CR= .404

CR=.334

CR=.277

CR=.275CR=.249

CR=.280 Coaching

CR=.285

CR=.371

CR=.365

CR=.191

CR=.247

TolerateNothing

Less

From: Practice What You Preach by Maister

Global study:16 countries529 companies15,589 respondents

Chart: 4Workshop: 5

What do engaged employees look like?

1. They give more discretionary effort.2. They consistently exceed expectations.3. They take more responsibility and initiative.4. They receive better customer service ratings.5. They offer more ideas for improvement.6. They promote and model teamwork.7. They volunteer more for extra assignments.8. They anticipate and adapt better to change.9. They persist at difficult work over time.10. They speak well of the organization.

1 - 10

Customer satisfaction drives customer loyalty… and customer loyalty drives profitability

100%

90

80

70

60

50

40

30

20

Extremely Dissatisfie

d

SomewhatDissatisfie

d

SlightlyDissatisfie

dSatisfied

Very Satisfied

Zone of Defection

Zone of Indifferenc

e

Zone of Affection

Loyalt

y

Customer Satisfaction

Terrorist

Evangelist

A 5% increase in loyalty among your best customers…

Can produce a profit increase of 25% – 85%

I hate you

I don’t care about you

I love you

Actively disengaged employees can reduce revenues by up to 22%, while highly satisfied and engaged

employees can drive profits up by as much as a 189%

Culture = Cash

74%23,000,000

88%

What they look for in a leader…

Credibility

1.Honest2.Forward-looking3.Competent4.Inspiring

Anne MulcahyCEO of Xerox and the third most powerful woman in the world!

1. Build a network of great relationships with people who want to see you succeed.

2. You don’t have all of the answers, so ask for help and advice from the smartest people you can find.

3. Learn to be a learner.

4. Listen intently to your employees and to your customers.

Some really great advice…

What does it take to be a valued member of a team?

Develops and display competence.

Follows through on commitments.

Delivers required results.

100% integrity / honesty.

Enjoyable to work with – positive attitude.

Passionate about their work and those they serve.

Communicates and keeps everyone informed.

Helps the other members of the team.

Is proactive – looks for responsibility.

Creative and innovative.

Share ideas, information and credit.

Hold themselves 100% accountable.

If this is what you want on your team…You MUST be a living example of this first!

• Lack of TRUST• Lack of candor• Lack of commitment• Lack of accountability• Lack of results

Competence

RespectDistrust

Affection TRUST

HIGH

LOW

LOW HIGH

Concern

The 4 C’s of Trust

John Spence High-Performance Team Model

• D• M• C• C• M• D

irection – vivid, clear, inspiring --- shared

easurements – specific, observable, focused

ompetence – very good at what they do

ommunication – open, honest, courageous

utual Accountability – all team members

iscipline – do this every day

4-Level Decision Making

1. You own it.

2. Ask for input… you own it.

3. Team decision… I own it.

4. My call… I own it.

Empowerment + Accountability

The 4 Pieces of Paper

11 Key Team Competencies:

1. Setting clear, specific and measurable goals.

2. Making assignments extremely clear and ensuring required competence.

3. Using effective decision making processes within the team.

4. Establishing accountability for high performance across the entire team.

5. Running effective team meetings.

6. Building strong levels of trust.

7. Establishing open, honest and frank communications.

8. Managing conflict effectively.

9. Creating mutual respect and collaboration.

10. Encouraging risk-taking and innovation.

11. Engaging in ongoing team building activities.

1 - 10

The key elements of a winning culture: Employees

• Fun• Family• Friends• Fair• Freedom• Pride• Praise• Meaning• Accomplishment

• Ownership Mentality• Sense of Urgency• Disciplined Execution• Accountability• Continuous Innovation• Customer Focus

The key elements of a winning culture: Company

Extreme Customer Focus

A few good quotes…

• “We are not in the coffee business serving people… we are in the people business serving coffee.” Howard Schultz, CEO – Starbucks

• “We took our eye off the ball and it damn near put us out of business. We forgot that the customer pays ALL the bills. We are here to serve them, help them, support them. Not keeping that at the front of our minds almost cost us everything.” Lou Gerstner, CEO - IBM

• “The very future of our company hinges on our ability to understand and serve our customers better than any other firm. It is all about customer service, the products are actually secondary.” Jeff Immelt, CEO – GE

• “The only critic whose opinion counts, is the customer” – Mark Twain

The Five Levels of Customer Service

I don’t really care

Why try harder

Good enough is good enough

That’s nice

Wow – you guys are awesome

To have an effective Customer Relations program, these three statements MUST be true for your organization:

1. Customer satisfaction is a philosophy and a commitment by

top management.

2. Customer satisfaction is an attitude and atmosphere that

prevails throughout the entire organization.

3. Customer satisfaction is a program of ACTION within the

organization.

Fundamental Customer Expectations

• Reliability: The ability to provide what was promised, on time, dependably and accurately. (Honesty)

• Assurance: The knowledge and courtesy of employees, and their ability to convey trust and confidence. (Competence)

• Empathy: The degree of caring and individual attention provided to customers. (Concern)

• Responsiveness: The willingness to help customers and provide prompt service. (Attitude)

• Tangibles: The physical facilities, equipment, and appearance of the personnel. (Professionalism)

How do the Best Companies Deliver Superior Customer Service?

• From a study of more than 3,000 companies — narrowed down to the top 101 companies that profit from customer care — here are the top five factors that were the fundament tactics used to build and manage extraordinary levels of customer satisfaction and loyalty.

1 -10

They listen to, understand, and respond (often in unique and creative ways) to the evolving needs and constantly shifting expectations of their customers. (VOC)

Extreme Customer Focus

They establish a clear vision of what superior service is, communicate that vision to employees at all levels, and ensure that service quality is personally and positively important to everyone in the organization..

Shared Customer Service Credo

They establish concrete standards of service quality and regularly measure themselves against those standards, guarding against the “acceptable error” mindset by establishing as their goal 100% customer satisfaction performance.

Clear Standards + Accountability

Measure & Post Create A Dashboard of Key Indicators

MPS Margin Per Sale

Talent

Customer Service

Customer Retention

They hire the best people, train them carefully and extensively so they have the knowledge and skills to achieve the service standards, then empower them to work on behalf of the customers, whether inside or outside the organization.

Customer Focused Employees

They recognize and reward service accomplishments, sometimes individually, sometimes as a group effort, in particular celebrating the success of employees who go “one step beyond” for their customers.

Deal decisively with mediocrity

Reward and Celebrate Success…

Understanding the Customer-driven Company

• Create a customer-focused Vision• Flood the organization with VOC• Become an expert on delivering

superior customer service• Turn your employees into customer

service champions• Destroy any barriers to superior

service performance• Measure, measure, measure• Walk the talk

10 – 15%

What Inhibits Execution?National Survey of 4,000 Senior Executives

4. Inability to work together (21%)

3. Company culture (23%)

2. Economic climate (29%)

1. Holding onto the past / unwillingness to CHANGE (35%)

Where are we going andhow will we behave on the way?

FocusDifferentiation“No”

Guiding Collation

Vision + ValuesStrategy

ObjectivesInitiativesPrograms

Procedures / ProtocolsRepeatable ProcessClear / consistent / relentless

Training +time / money /

supplies / people

Measure / TrackCommunicate

Transparency Accountability

Celebrate SuccessEliminate Mediocrity

THANK YOU

If you have any questions at all please do not hesitate to send a note or call. My email address is: john@johnspence.com

Also, you might find value in the ideas I share in my blog. You can sign up for it at:www.johnspence.com/blog