Tag Archives: Quality

Too Big to Manage = Too Big to Succeed!

Posted on 13 November 2009 by | 2 Comments

In MIT’s Sloan Management Review Julian Birkinshaw and Suzanne Heywood miss an opportunity at a fun knock-out title, so I’ll take it.  However, the content is an excellent view into how complexity can negatively impact a business’s ability to function effectively.

Let’s follow the trail…

  • If your company is too big to manage, then by default it is unmanaged.
  • If your company is unmanaged, its survival relies on chance (good luck or bad).
  • If your company has bad luck then it fails.
  • Thus, if your company is too big to manage, it is too big to succeed.  (Of course, your company could have good luck.  Good luck with that plan.)

After interviewing executives at 900 companies Birkinshaw and Heywood found complexity caused problems,

“…from weak customer responsiveness and inefficient processes to high levels of confusion and stress among employees.”

As a customer advocate let me hone in on how complexity can hurt customers.

  1. Lost Customers – Organization complexity can mean that customers don’t know who to contact to receive support.  Companies are so complicated that they need to hire gate-keepers.  These gate-keepers are a source of knowledge but only of the organization type.  Their domain expertise is to know who to contact for what.  They are the yellow pages of complex companies.
  2. Expensive Products – Complex products hinder product implementation, thus adoption, thus any chance at realizing ROI (whether ROI is measured in dollars or happiness).  How much positive word of mouth marketing should you expect to garner when the product can’t be used?
  3. Slow Responses – Complexity can reduce the speed in getting answers to simple questions which may open the door to competitors.  When do customers welcome slow service when the competition can provide the same service faster?
  4. Stuck in Neutral – Customers can’t purchase a product they need when they need it.  Complex processes delay or prevent sales from being completed.  How many times has a contract been so convoluted that the customer did not know to what they were agreeing?

The pivot point is that when complexity gets in the way of satisfying customers, big problems are on the horizon… unless you’re fortunate enough to receive a federal bailout.  Then, even if your company is “too big to manage” and indeed, “too big to fail”, it may also be “too big to succeed”, which in the end is just “too bad for customers.”

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Posted in Customer Service, Influential Factors - Harmful, Influential Factors - Helpful, Uncategorized, Why Bother with Customer Service

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Are You in the Race?

Posted on 7 September 2009 by | 1 Comment

Benchmarking is a common sense way to compare one facet of company performance to another company’s performance.  However, as is too often the case, common sense isn’t always common practice.

3 Benchmarking Success Factors:

1.  Know Your Customer – Before companies decide to benchmark their performance they should invest time to ensure they know their customers.  Customers have different preferences.  So, unless you run a boutique consulting business, don’t attempt to please everyone.

2.  Measure Relevant Attributes – For customer service, the 3 essential attributes are speed, quality, and cost.

Speed – For my products and services is speed important?  If a neurosurgeon thinks they’ll get paid more and have more satisfied patients by performing faster brain-surgery… well, you get the idea.

Quality – Volvo has a reputation for building cars built to last forever.  Benchmarking themselves against inferior quality autos would give them a false sense of achievement.

Cost – Again automakers present an interesting comparison point.  Think of Ford and Lincoln.  Big cost difference.  People purchasing a Lincoln are willing to spend more because they are buying the Lincoln brand which has historically signified quality.

3.  Make Appropriate Comparisons – This success factor is as important as knowing your customer.  It is effectively the same as defining your market.  To which company should you compare your company?  In a highly competitive market, compare yourself to your closest competitors.  So Pepsi should make a comparison to Coca-Cola.  But if you define the market differently, say as consumable beverages then perhaps a better comparison would be to Budweiser.

Benchmarking can be an expensive undertaking.  Some of the largest companies in the world invest millions to grow market share and make smart investments.  Even with a small budget, the exercise of thinking through the success factors can help set your company apart from the competition.  After all, any company can invest in ways to become faster, reduce costs, or improve quality.  Your goal is to improve in ways that matter to customers.

The pivot point is that benchmarking provides a way to know if you are winning the race, losing the race, or even in the race.

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Posted in Influential Factors - Helpful

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