Tag Archives: Culture

Sales Team Selling You Short?

Posted on 14 February 2012 by | Leave a comment

An interesting HBR Blog article by Andris A. Zoltners, PK Sinha, and Sally E. Lorimer asserts companies are addicted to harmful sales incentive cultures.  Incentives aren’t the problem.  The problem is determining whether or not the incentives drive behavior that is “healthy” for the company.

“Eat what you kill” models align with short-term growth but often come at the expense of long-term growth and stability.  The largest risk with highly leveraged compensation plans is that they often cause the customer to suffer for a company’s short-term thinking.  These plans cause behavior that over-commits, disappoints, and causes rifts with customers which eventually harms the company.  To combat this impact many companies adopt hybrid approaches where one team hunts and another farms.

It would be easy to blame over-aggressive salespeople for customer dissatisfaction.  But the problem lies with management.  Incentives drive behaviors and engagement.  Focusing compensation too heavily on revenue increases the top line but it comes at an extreme cost.  Instead… reward:

  1. Long-term growth AND short-term growth
  2. Customer satisfaction
  3. Retention and renewal
  4. Selling more to existing customers

Wall Street rewards top line growth… for a time.  Eventually, various functional teams must be aligned to achieve profitable growth.  Otherwise, you’ll have sold your company short.  The pivot point is to ask if top-line growth is more important than loyal and profitable customers?  Such short-term thinking may result in favorable initial results if it bolsters top-line growth.  Later your company suffers.  How long can you afford to buy revenue?

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Posted in Employee Engagement, How to Deliver Customer Service, Influential Factors - Harmful

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Failing Grade for @BassettUS

Posted on 23 January 2012 by | 4 Comments

Four years ago I made the mistake of purchasing a sofa from Bassett Furniture.  I didn’t know it was a mistake at the time, but I should have.  (Now, I’m kind of blue.)

Bassett Furniture makes me blue

Warning signs I should have considered:

  • No online customer feedback mechanism – Does the company offer online feedback mechanisms and transparency?  Bassett doesn’t and this omission should have spoken volumes to me.
  • Plenty of irate customers making their voices heard anyway – A simple internet search would have yielded many vocal consumers.  (1, 2, you get the idea.)
  • Remember you are buying the brand – In my case I shopped for a product.  Initially, I liked the product.  My perception of the brand is much different now.

Advice for Bassett Furniture:

  • Stop hiding behind your warranty – Instead, stand behind your products.  A company like Bazaarvoice can help provide tools to enable a feedback loop with the purpose of developing loyalty.  Companies that offer a way to communicate (good, bad, or indifferent) demonstrate their customer commitment.
  • Find SOME way to satisfy the customer – Fact: the product is poor.  I didn’t expect a full refund.  However, some financial acknowledgement would have gone a long way towards restoring a rapidly fragmenting relationship.  “Not our problem” may work in a monopoly, but it cannot survive in a competitive, transparent, and vocal marketplace.
  • Own the problem – Local store management, who knew otherwise, suggested I contact the warranty company and indicate that I’d only recently noticed the problem.  Helpful?  Dishonest?  You decide.  A company willing to treat its business partners without integrity is unlikely to treat customers otherwise.
  • Rename your “Customer Service” department – I suggest “Policy Enforcement” but only as the most expedient and honest course of action.  Guaranteed your employees would rather that you improve the products and services instead.

In the final analysis, Bassett Furniture gets failing grades in Product, Service, and Honesty.The pivot point is that Bassett would be better served by treating customer complaints as gifts.  From the looks of things, other customers have gifts for them too.

Before you go, please Tweet or post to Facebook or LinkedIn.  I made a mistake with Bassett Furniture… help ensure others don’t make the same mistake.

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Posted in Culture, Customer Service

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Aligning your Business to Customers: Pillar 4 – Leadership

Posted on 1 August 2011 by | 3 Comments

The fourth and final pillar that helps companies align to customers is leadership.  Leadership is the beginning or the end of customer service just as it is the beginning and end of all victories (or losses).

  • Culture – What are we and how do we behave when no one is watching over our backs?  Start-ups in particular have the ability to set a purposeful course with their companies.  Companies that value customers holistically (i.e. those that value long-term relationships over short-term financial transactions) set the tone.  They ensure that expectations can be met before a sale is made and they make the customer experience a journey that encompasses the entire brand.
  • Focus – Can our people depend on us to execute on a sharp vision of future, or are we tempted to try to do everything at once?  Organizational ADD benefits no one; not customers, not employees, and not shareholders.
  • Honesty/Integrity – Self-evident?  Hope so.  Fact is, words don’t carry same weight/impact that actions do.  Regardless of whether you think personal conduct is relevant to professional capabilities, our people look to leaders.  When leaders fail, organizations slide down the slippery slope to failure also.
  • Transparency – Transparency is a key element in trust.  The more we disclose to employees, the less we hide and the more authentic the conversations become.  For those uncomfortable with the process, read Jack Stack’s book, The Great Game of Business.
  • Outcome Orientation – Want people to give their best each day?  Ask them to deliver results and don’t dictate the method.  People bring different skills to work each day.  When we give them latitude to use those skills they feel better, are more willing to develop and contribute new skills, and add an element of innovation throughout each day.  Take the opposite tack and leave employees with little discretion and you should assume you’ll get little effort and commitment.

The pivot point is that employees (the same ones that interact with customers and deliver service each day) will observe and mimic the customer focus that the leadership team sets.

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Posted in Culture, Customer Service, Leadership

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