Stakeholder Magazine - Mar. 2006

S AT I S F A C T I O N Creating value for customers, employees and shareholders

Happy Family Bettys and Taylors of Harrogate REWARDS AT DAVID LLOYD UK CUSTOMER SATISFACTION & LOYALTY CONFERENCE 2006 PROTECTING YOUR REPUTATION COMPLAINT RESEARCH DATA - TRUE OR FALSE? 5 STAR CUSTOMER MANAGEMENT CONFERENCE PLUS THE BALANCED SCORECARD BOOK REVIEW DIARY DATES

March 2006 VOLUME 3 ISSUE 1 £4.50

Customer Satisfaction Measurement

Customer Satisfaction Measurement

Level 1

Level 2

A practical one day course that will take you step-by-step through the process of accurately measuring your customers’ satisfaction.

This course examines the more advanced research techniques relevant to Customer Satisfaction Measurement and is suitable for people wanting to develop or critically assess their existing process.

The day covers

The day covers

Questionnaire design Sampling Methodology Analysing & reporting How to calculate a satisfaction Index Pitfalls to avoid Dates Birmingham London Leeds Luton Bristol Manchester

28th March 4th April 25th April 27th April 9th May 10th May

A robust measurement for tracking Measuring importance Sample reliability How many questions?

Complaints and problems Benchmarking Timing and frequency Dates 27th 11th 18th 28th

Manchester Manchester London Leeds

March May May June

Cost: £325 excl VAT

Cost: £295 excl VAT

Over 5000 delegates have attended worldwide Presenters are authors of leading books in the area of customer satisfaction & loyalty

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For more information and a detailed agenda: CALL RUTH COLLETON on

01484 467000 Book online at

www.leadershipfactor.com

The

F A C T O R L E A D E R S I N S AT I S F AC T I O N M E A S U R E M E N T

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March 2006

Diary Dates

Training courses and Conferences from around the country

24 Customer Holding on to stakeholders when it hits the fan. By Michael Bland

7 News Customer Satisfaction Reaps Rewards for Employees

8 The Balanced Scorecard Article 3: Balanced Scorecard and Customer Measures 10 Case Study

29 Latest Thinking

Bettys and Taylors of Harrogate

by Rachel Allen

Complaint research data True or false? By Colin Adamson

34 Customer 5 Star Customer Management Conference

36 Fast Guide Fast guide to “Attracting and keeping staff� by Ray Robertson

16 Employee

In this issue...

VOLUME 3 ISSUE 1

37 Book Review

Engaging and Rewarding people at David Lloyd Leisure by Ray Robertson

20 Customer Annual Customer Satisfaction & Loyalty Conference 2006 Stakeholder March2006

3

Charlotte Ratcliffe editor

It pays to tell the truth ...is the theme running through this issue of Stakeholder Satisfaction. Even if you’re selling a product that kills people, build your whole brand around that fact. Not convinced. See page 23, where the report on the 2006 UK Customer Satisfaction and Loyalty Conference explains how BJ Cunningham marketed his Death cigarettes. Being true to yourself, walking the talk is also one of the “Seven Secrets of Inspired Leaders” reviewed on page 37.

Three million trees Not many medium sized businesses with just under a thousand employees have planted a million trees a year for the last three years. Bettys and Taylors, our cover story for this issue, believes in living its values. As well as planting trees, they buy tea and coffee on quality not price, pay their suppliers a fair price and even make sure that this translates into fair wages by auditing the working and living conditions of their suppliers’ employees. This doesnít seem to be harming the companyís financial performance. People will pay for good value. Anyone who’s taken tea and scones at Bettys in Harrogate (thatís just about everyone who ever goes to Harrogate), will confirm that the prices are far from cheap. But the queues often stretch out of the door and down the pavement.

Win-win As far as we know, David Lloyd Leisure doesnít plant a million trees a year but it has been very successfully delivering results to its three key stakeholder groups employees, members and investors. On page 17, Ray Roberston explains how the company uses its own version of balanced scorecard, the Club WIN card, to align all its staff behind the key objectives of delivering a great experience to members in order to produce great financial results for shareholders.

Protecting your reputation And if the **** does hit the fan you still need to be honest, although as Michael Bland explains on page 25, a little advance planning can make a big difference to an organisationís ability to protect its reputation if it is engulfed by bad publicity.

Stakeholder is the magazine for people who want their organisation to deliver results to employees, customers and any other stakeholders as part of a coherent strategy to create value for shareholders. We publish serious articles designed to inform, stimulate debate and sometimes to provoke. We aim to be thought leaders in the field of managing relationships with all stakeholder groups.

Editor: Assistant Editor: Contributors

Charlotte Ratcliffe Lucy Froggatt Nigel Hill Stephen Hampshire Ray Robertson Rachel Allen Iain Law Michael Bland Colin Adamson Rob Ward Designer: Creative Director: Rob Egan Louise Martin Advertising: Editorial Director: Janet Hill

Printers of Stakeholder magazine info@stakeholdermagazine.com Stakeholder Magazine PO BOX 1426 Huddersfield HD1 9AW Tel: 0870 240 7885 NB: Stakeholder does not accept responsibility for omissions or errors. The points of view expressed in the articles by attributing writers and/or in advertisements included in this magazine do not necessarily represent those of the publisher.

Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without prior written consent of the publisher.

Copyright © STAKEHOLDER MAGAZINE 2004

ISSN 1749-088X Stakeholder March2006

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Diary Dates

April

IoD Annual Convention 2006 26 April - London

June

Customer Satisfaction Measurement Level 1 4 April - London 25 April - Leeds 27 April - Luton

This year’s forum offers you an opportunity to explore the many different elements of inspirational leadership, including the strategies and experiences of leading companies and individuals. www.iod.com 020 7766 8919

Analysing & Reporting Customer Satisfaction Data 7th June - Birmingham

This one day training course takes delegates step-by-step through the process of using customer surveys to accurately measure customer satisfaction.

Includes instruction on relevant research techniques, group exercises and opportunities to ask questions relating to your organisation’s customer satisfaction measurement practices. www.leadershipfactor.com 01484 467000 HRD 2006 - The CIPD Annual Learning, Training and Development Conference and Exhibition 4 - 6 April - London HRD is the largest and most influential event for busy professionals to keep up to date on the latest issues and innovations in learning, training and development. www.cipd.co.uk Customer Loyalty 5 April - London This one day training course provides a complete treatment of the topic of customer loyalty, from strategic principles to research practice. The course is ideal for those who want to move beyond customer satisfaction to research that has more strategic influence for their business. www.leadershipfactor.com 01484 467000

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Diary dates

Stakeholder March2006

May The European Conference on Customer Management 2006 15 - 18 May - London Europe’s largest event on Customer Management includes over 50 speakers including 10 Gurus such as Jack Welch, Philip Kotler, Malcolm Gladwell and Marcus Buckingham. This year’s conference features the new Customer Loyalty and Retention Summit with special keynote address by Philip Kotler. www.ecustomerserviceworld.com 020 7915 5103 Improving Employee Satisfaction 16th May - London If you buy into the idea of satisfying your employees, having a robust employee survey is essential. This one day course is a practical step-by-step guide to creating an employee survey that links to your customer measures, and ultimately to business success. www.leadershipfactor.com 01484 467000 How to Write Effective Letters that Win Customers 23 May 2006 - London One day training course run by PR company Red Lorry Yellow Lorry. Discover how to write an effective modern business letter. Ideal for anyone who regularly writes to customers. The course includes defining a written tone of voice to training teams of writers, and from writing key documents to helping clear response backlogs. www.socapeurope.org 01438 310021

This seminar is packed with practical advice and ideas for analysing and reporting Customer Satisfaction Measurement projects. The course will provide real hands on experience of using Excel for data analysis. Templates and formulae are given to each delegate to take away and use back in the office. www.leadershipfaactor.com 01484 467000 Customer: Strategy & Management 2006 21-22 June - Birmingham Customer 2006 is an event for customer service, sales, marketing and senior corporate management who are developing strategy and sourcing product and service suppliers to help them identify, win, satisfy, retain and grow profitable customers. www.customer-event.co.uk 020 7921 8522 Rescuing Reputation 28 June - London This course, run by Michael Bland is ideal for anyone who may be confronted by the media. You will learn how to deal with journalists and with the various ‘audiences’. The course includes understanding the nature of crises and issues, realistic and achievable crisis preparation and analysing and communicating with the various ‘audiences’. www.socapeurope.org 01438 310021

News

news

BT Customers Unhappy

Midland Mainline at top of rail table Midland Mainline has overtaken GNER as the train company with the most satisfied customers. According to the survey passenger focus they have an 89% satisfaction rating, compared to GNER’s 87%. This is a rise of 10% over the last twelve months.

According to a survey by Which? magazine, 71% of BT customers are unhappy with the level of service they are receiving from the company.

Many customers find their monthly bills confusing and BT’s charges seem to increase or change without warning.

Another reason for customers’ dissatisfaction is that when they attempt to contact BT to report a fault with their telephone line, they only have access to automated messages - not real people to report the problem to. Which? magazine encourages customers who are unhappy to switch suppliers, stating that ‘there’s never been a better time to switch home phone suppliers...there are more choices than ever and prices are dropping all the time’.

Currys and PC World are to be paid extra bonuses for increasing customer satisfaction.

DSG usually reward employees on sales targets but recently the company have been under fire with complaints from furious customers who are infuriated by the poor service provided and the delay in resolving problems from these retail chains. The new scheme aims to reward staff that have been helpful to customers rather than basing bonus payments on level of sales.

Of the 32 categories the companies are judged on the lowest overall scores (for all train companies) were 33% for coping with delays and 39% for the condition of the train toilets.

Poor health linked to job dissatisfaction

BskyB Losing Customers Rapidly BSkyB are facing ongoing pressure as thousands of customers cancel their Sky

Customer Satisfaction Reaps Rewards for Employees

According to research carried out by Lancaster University and Manchester Business School, workers who are unhappy in their jobs are more likely to become ill.

A study of 250,000 employees found that people with low job satisfaction were most likely to experience emotional burnout, have reduced self-esteem and suffer from anxiety and depression.

Employees working for DSG International, which owns the retail chains Dixons,

contracts. Many are switching to the competition such as Freeview and cable companies. BSkyB are failing to offer the extra services that customers see as added value such as live betting.

Professor Cary Cooper (Lancaster University Management School) found that “Workers who are satisfied by their jobs are more likely to be healthier as well as happier” and "Organisations are reducing their permanent workforce and converting to outsourcing, which is increasing feelings of job insecurity.”

Stakeholder March2006

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The Balanced Scorecard

Article 3: Balanced Scorecard and Customer Measures In the last issue of Stakeholder Satisfaction, Ray Robertson explained how balanced scorecard aligns employee performance measures and rewards with the organisation’s vision, strategy and values. Devised by Kaplan and Norton (Ref1), the scorecard comprises four perspectives: financial, operational, people and customer. This article examines how customer measures are incorporated into balanced scorecards.

The importance of customer measures On all standard balanced scorecard frameworks, such as Malcolm Baldrige or EFQM, customer measures form the largest single element of the scoring system because:

1. The fundamental purpose of any organisation is to meet the needs of its customers. If it isn’t, what other purpose does it serve?

2. Commercial businesses generate revenue from customers.

Consequently customers’ attitudes about the organisation comprise the best lead indicator of their future propensity to spend money on its products or services.

Most balanced scorecard users therefore focus heavily on the lead indicator aspect of customer measures as well as linking customer attitudes with their consequences in terms of tangible behaviours such as the 3Rs of repeat purchase, related sales and referrals.

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Stakeholder March2006

Customer measures as lead indicators A fundamental element in many organisations’ failure to manage customer satisfaction effectively is their inability to distinguish adequately between customers’ attitudes and behaviour. Since the organisational benefits of customer satisfaction derive from the ways customers behave we will examine that concept first.

Customer behaviour Customers can behave in ways that are good for organisations or bad for them.

There are many desirable behaviours that companies want customers to display.

They want customers to stay with them for a long time, they want them to spend lots of money – perhaps by buying more often, buying a wider range of products or services from the supplier or by becoming less price sensitive. They want customers to recommend them to other people, to make constructive suggestions for service or business improvement and to fit in with the company’s normal operating procedures. There is evidence that the

most satisfied and loyal customers display all the desirable behaviours – even “thinking like owners”. Illustrated in (Figure 1 on the right), Frederick Reichheld (Ref2) has quantified the financial benefits of these desirable customer behaviours.

The link between desirable customer behaviours and business perfrormance is both intuitive and well supported by empirical evidence. The challenge is getting them to behave in those ways. In recent years many organisations have developed the misguided notion that they can somehow use software or other tools to ‘manage the customer relationship’.

Even assuming your customers do want a relationship with you (unlikely if you’re a utility, a local authority or an insurance company for example), why would they abdicate its management to the supplier?

Only if human behaviour is determined by the most basic of Pavlovian instincts would this be credible. On the contrary, the vast majority of customer-supplier relationships are driven by rational customers who make judgements about the benefits to them of deploying the

The Balanced Scorecard

various behaviours outlined in the preceding paragraph. Suppliers have to respond to customers not manage them.

If they concentrate on fully understanding customers’ requirements, follow the customers’ agendas and succeed in meeting or exceeding customers’ requirements, most customers will judge that they have more to gain than to lose by sticking with the supplier and the desirable behaviours will follow. But how do they form those judgements?

Figure 2: Satisfaction attitudes drive loyalty behaviours 100%

Zone of affection 80%

Zone of indifference 60%

Loyalty

40%

Zone of defection

Customer attitudes

20%

Customers’ judgements about how to behave with organisations are based on what they think about them and these attitudes are based mainly on their direct experience with the organisation – ‘the deliveries were often late from that company in the past so there’s a strong possibility they won’t meet their delivery promise if I order again’. Secondly they’re based on what other people say – ‘my colleague at the trade association told me how their production schedules were disrupted by a late delivery from company X’. Thirdly, they can be affected by what the supplier says – ‘the latest newsletter from company X suggests that their ‘delivered on time’ stats have gone up a lot, and customer satisfaction’s improved too’.

In competitive markets very few perform badly enough to dissatisfy a significant proportion of their customer base over a long period of time. They’d be dead if they did. That may be progress compared with a couple of decades ago, but customers’ expectations have also risen since then. In most markets suppliers need to do much more than not dissatisfy customers if they want to maximise the benefits of customer satisfaction. As Harvard point out in their conclusions on the relationship

Satisfaction

Saboteur

1

5

10

Source: Professor J. Heskett, Harvard Business School

between satisfaction and loyalty (Ref3), the zone of indifference just isn’t good enough (see Figure 2). Why would customers in the zone of indifference stay with a supplier other than through inertia?

Why would they buy an additional product or service or recommend the business.

They wouldn’t. These days most people think they can do better than ‘OK’, ‘average’ or ‘good enough’. To keep customers, suppliers have to deliver such great results that rational customers will conclude that it would be difficult to do better elsewhere.

Balanced scorecard measures To monitor these vital predictive attitudes, a balanced scorecard must record measures of: Overall customer satisfaction based on a composite customer satisfaction index The extent to which customers’ specific requirements are being met

Progress on increasing customer satisfaction in areas where their requirements are not being met – the PFIs (priorities for improvement) Customers’ beliefs about their likely future behaviours such as likelihood of remaining a customer, buying related products and recommending.

Balanced scorecard measures of actual customer behaviour will vary across different types of organisation. Typically they would include measures of sales, broken down by product line, market segments or geography as relevant, and as many customer lifetime value measures as the organisation can produce. These are dependent on an extremely good database but should include cohort measures of customer retention / defections, sales growth, share of wallet, referrals and customer profitability. (See Stakeholder Satisfaction October 2004 pages 8-9). S

References

Figure 1: Components of Customer Lifetime Value (Source: Harvard Business Review September 1990) Suggestions for product or service improvement Referrals Profit from price premium on custom products

Net Impact on Operating Profit

Reduced cost of serving customer

+

Purchases of new products

0

1

2

Year 3

Purchases of standard products Customer acquistion cost

4

1. Kaplan & Norton “The Balanced Scorecard”, Harvard Business School Press, 1996

2. Reichheld & Sasser “Zero Defections: Quality Comes to Services”, Harvard Business Review September-October 1990

3. Heskett et al “The Service-Profit Chain”, Free Press 1997

5

To see how balanced screcard works at David Lloyd Leisure see Ray Robertson’s artical on page 30 Stakeholder March2006

9

Case Study

ettys and Taylors is a traditional family company based in the heart of North Yorkshire. This unique business is devoted to many of life's pleasures; handmade cakes, mouth watering chocolates, beautiful Café Tea Rooms, rare and exclusive coffees and fine teas.

10

the attractive shop front and the aroma of Taylors of Harrogate freshly ground coffee and the tantalising glimpse of Bettys hand made cakes, breads and chocolates is guaranteed to seduce. And seduce it does. Last year, Bettys in Harrogate (one of six Bettys Café Tea Rooms), welcomed a staggering half a million visitors through its doors.

However, being successful to Bettys and Taylors means more than just great sales.

This is a business that believes in trading fairly, supporting the local community, preserving traditional craft skills - and being a good place to work for its staff.

Stakeholder looks at the business behind the famous brands - Bettys Café Tea Rooms, Yorkshire Tea and Taylors of Harrogate Coffee.

However, as the order and calm of the busy tearooms suggest, the success of Bettys is no lucky accident. Behind the sophisticated décor lies a comprehensive and coherent business strategy that has earned numerous awards and accolades including the 'Oscar' of the tea world 'Top Tea Place of the Year' on three occasions.

No trip to Yorkshire would be complete without a visit to Bettys. For residents and visitors alike the lure of these elegant tearooms is hard to resist. Saunter past

Bettys, as the name might suggest, is only part of the Bettys and Taylors business.

Equally acclaimed and awarded is Taylors of Harrogate, the tea and coffee importing

Stakeholder March2006

and blending side. And then there is Yorkshire Tea, another award winner, of which over 9 million cups a day are drunk.

Each range of products is an example of excellence in its market.

But, it is not just the customers that are happy at Bettys and Taylors. Employee satisfaction surveys reveal that nearly 74% of staff "love" working for the company and 80% feel proud to work there. No mean achievement when there are just under 1000 employees on the books. The business has been named Best Employer in Yorkshire and recognised for five years running as one of the country's 100 Best Companies to Work For by the Sunday Times. The reward is a staff turnover 'that is so low, we don't even bother to measure it' and annual sales of over £50m.

So, what is it the secret of Bettys and Taylors success with its employees?

Case Study

A family business with family values Bettys and Taylors is still very much a family business with defined family values.

This is evident to staff from their very first day and echoed in the unique culture and day-to-day running of the business.

This company has a competitive spirit and every annual objective revolves around quality and being the very best.

In true textbook management style, employees see that there is visible support and encouragement from 'the top'. On their first day at Bettys and Taylors, or very soon afterwards, all new staff spend time with Jonathan Wild, Chairman, and great nephew of Bettys founder Frederick Belmont, and his wife Lesley, Deputy Chairman.

That is just the start of their Bettys and Taylors experience. When an employee celebrates a special occasion, the event will be marked with a personally signed card from Jonathan. When a member of staff has a child or grandchild a tree is planted with the Yorkshire Millennium Trust.

These are not empty gestures, designed to impress. This treatment is indicative of the way in which employees at Bettys and Taylors are treated like family - and made to feel valued. There is no 'them and us' here. Jonathan knows all staff by their first name and is proud to be a hands-on, accessible leader - who insists that his managers are hands-on and accessible too.

Jonathan is a regular in the bakery, the director for tearooms spends at least 50% of her time on the shop floor and the director for manufacturing spends at least 40% of her time in the production areas.

When the need arises, at busy times of year, directors willingly work on the 'shop floor'. It is this sort of participation that builds team spirit and a 'can do' attitude amongst employees.

This is a family business in more ways than one. Bettys and Taylors operate a team structure, where the team leader is

described as the 'parent'. It is at this level that operational plans are developed, with each team functioning as self-regulating 'family'. The aim is to create a fired enthusiasm in all staff through involvement - and it works. The teams are small, an average size of seven, reflecting Jonathan's wish to work with small groups 'and a leader who has time for you'. Each 'parent' reports to a departmental manager, who in turn reports to a general manager. The directors are the next level up.

Rewards and recognition Employees at Bettys and Taylors know they are cared for. It is part of the culture.

They are actively encouraged to participate and contribute to the running of the business. Much use is made of the employee 'feedback' system and a number of schemes have been introduced to recognise and reward staff involvement, such as: o Profit related awards - four times a year o Bottles of champagne as the reward for going above and beyond in assisting customers o Awards such as 'team player of the month' o Recognition for long service o Prizes awarded to employees whose ideas improve the company Bettys craft bakery, (where all the bread, cakes and chocolate is made for the cafes) creates around 600 different products. The ideas have to come from somewhere, and it is the company's staff that generate a fair number of them. Their innovations include Old Peculier Fruit Cake, marzipan beetles and praline ladybirds. What could be more exciting and motivating to staff than knowing 3 million visitors could see their idea in a Bettys CafĂŠ Tea Room?

Work-life balance Bettys and Taylors understand the short and long-term benefits of helping staff to achieve a work-life balance that suits their particular needs. They see it as one of the keys to retaining a satisfied workforce

Stakeholder March2006

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Case Study

whilst giving the business an advantage in the recruitment market by becoming an employer of choice. In a drive to create loyal, committed staff, measures have been introduced based on discussions with staff. It is recognised that individual employees have different requirements, it is possible to achieve work options that are good for both the individual and the business.

An annual confidential staff questionnaire gives employees the opportunity to raise issues for consideration. This includes a question on ethics that includes questions on whether employees enjoy being at work and whether they feel the company pays enough attention to their opinions and accommodates their needs.

For example, as a result of listening to staff and to help attract more women to the Taylors manufacturing site, consideration was given to introducing a mid-day shift (10.00am - 2.00pm) that would fit in better with childcare.

Bettys and Taylors don't just take care of their staff - they look after suppliers too.

In the UK wherever possible, they try to use small companies - as long as it doesn't compromise on quality.

Overseas, the business has its own sustainable sourcing programme and an 'ethical champion' to help co-ordinate work with the tea and coffee growing communities.

To accommodate the variation in working patterns between different parts of the business, an overall work-life balance policy was established and then tailored for each location. Managers are given the authority to use their discretion when it comes to requests for additional time-off etc. based on the employees' performance.

To help employees achieve a more satisfactory work-life balance, the following policies have been introduced: o o o o

Flexible paternity and maternity leave Parental leave Leave for emergencies Work-time flexibility - variable shift patterns o Diverse range of (free) training opportunities o Sabbaticals

Social responsibility

"Our buying philosophy is simple. We aim to buy the very best teas and coffees in the world... for us quality is everything�.

"Quality goes much further than the great flavour in our cups though: we believe that quality should encompass the quality of life for those who are growing our teas and coffees, so we aim to pay sustainable prices for all our teas and coffees. That's a price that covers the cost of production plus the profits that farmers need to look after their land and provide for their families. Furthermore, all our buyers are qualified as social auditors; they check the living and working conditions of the people on the farms to make sure they are treated with respect�.

"We know most of the farmers we buy from well, and regard many of them as friends and we are committed to longterm relationships so that our tea and coffee suppliers know that we're not here today and gone tomorrow. Thanks to our buying policy, the farms we work with continue to thrive and produce the excellent quality that we require�.

pledge, working in partnership with recognised charities such as Oxfam, to plant one million trees around the world.

(Trees were chosen as they are one of the world's most valuable resources and vital to man's existence).

Today, nearly three million trees have been planted in Ethiopia, Kenya, India, Indonesia, Brazil, Guatemala, Ecuador... and many more countries besides. Trees for Life tokens appear on all Bettys and Taylors products.

Closer to home As well as planting trees in countries that grow tea and coffee, Bettys and Taylors have also worked with leading charities to support conservation work closer to home.

With the support of customers they have replanted native woodland, repaired footpaths and dry-stone walls in the Yorkshire Moors and Dales with the National Trust; worked with the Woodland Trust to plant 10,000 trees and preserve some of Britain's ancient woodland; and supported fellow tree-planters and local conservation groups with 'Trees for Life' bursaries and awards.

Trees for Life In 1990, as part of their plan to 'give something back' to the communities they rely on, Bettys and Taylors made a

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Stakeholder March2006

Bettys and Taylors have a long history of working with local communities, from schools to local charities and clubs supporting school children through Bettys

Case Study

ten scores for putting something back in the community. Four in five employees at Bettys and Taylors believe that the business is run on sound moral principles.

Cookery School and mentoring initiatives.

And, in another move designed to involve employees and benefit the community, each year staff vote for the charity they would like to support for 12 months. In the past The Multiple Sclerosis Society, The Starlight Children's Foundation, and local hospitals and hospices are some of the good causes that have benefited.

Donations usually amount to ÂŁ30k a year.

Staff are also allowed to do charitable work within company time. This is an offer taken up by more than 10% of employees.

Future Running a family business brings its own unique problems and challenges. Bettys and Taylors have managed to combine the best of both worlds to create a management structure that clearly works at every level. Family and non-family are involved in the decision-making process with a Constitution Committee acting as a neutral bridge between Family Council and the Group Board.

Although the rewards are intangible, this is the sort of behaviour that instils a feelgood factor in staff and creates a general sense of pride and satisfaction.

Bettys and Taylors is currently fully family owned. The thought of any family company falling out of family hands must be difficult to face, However, Jonathan

In a recent Sunday Times survey, Bettys and Taylors achieved one of the highest

envisages that a non-family members will succeed 'when the time comes'.

Whenever the time does come, one thing is certain, the successor will 'inherit' a business where paying meticulous attention to detail and the desire to achieve excellence has paid off. A business that everyone is proud to be part of.

Bettys and Taylors awards include: Best Employer in Yorkshire, Queen's Award for Enterprise for Sustainable Development, Business in the Community Cause Related Marketing Award for Excellence, Customer First Award, Top Tea Place of the Year, and they have been recognised for five years running as one of the country's 100 Best Companies to Work For by the Sunday Times.

Creating a committed workforce Creating Commitment a

b

INFORMED

a

INVOLVED

b

PRIDE

TRUST

C

C

SHARING IN SUCCESS

ACCOUNTABILITY FOR RESULTS I SENSE OF BELONGING TO THE ORGANISATION

II SENSE OF EXCITEMENT IN THE JOB

COMMITED WORKFORCE

III CONFIDENCE IN MANAGEMENT LEADERSHIP

a

b

AUTHORITY

DEDICATION

C COMPETENCE

Jonathan Wild has succeeded in creating a committed workforce at Betty and Taylors by following the principles outlined in Martin & Nicholls 1987 'Model of Commitment'.

Based on their research in 14 British companies, Martin and Nicholls identified three major pillars of commitment: 1. A sense of belonging to the organisation. The workforce felt they were involved, informed, and shared in the organisation's success. This sense of belonging avoided the 'them and us' culture prevalent in some organisations.

2. A sense of excitement in the job.

The workforce was proud of what they were achieving, trusted by management, and accountable for results thus creating an excitement that was motivating.

3. Confidence in management.

Management had authority, dedication, and competence and thereby created a climate in which commitment flourished.

Stakeholder March2006

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Case Study

Useful facts about the UK Family Business Economy: 1. The family business sector in the United Kingdom is estimated to account for over two thirds of all companies. The sector represents approximately half of the UK's private economic activity and employment.

2. Family firms represent over a third of the UK's leading private firms listed in the Sunday Times Top Track 100 survey.

2. (Source: Sunday Times Top Track 100 survey 2004) 3. In the quoted sector 7% of the companies in the FTSE All Share Index are family businesses. The UK stands out in terms of international comparison with the smallest number of quoted family companies relative to the quoted sector overall in developed market economies 2. (Source: IFB sponsored study by Manchester Business School, 2005. Dr Panikkos Poutziouris) 4. The majority of family firms are still operating in a "closed circle" with less than 40% employing any non-executive directors on their boards.

2. (Source: Leadership, culture and change in UK family firms. London Business School research in partnership with IFB, sponsored by BDO Centre for Family Business, 2003.)

5. Regarding ownership there remains a strong commitment within well established firms to retain family controlled status with nearly 4 out of 5 companies polled in 2004 saying that they want to retain the shares in the family.

2. (Source: IFB National Forum Conference Survey sponsored by JPMorgan Private Bank, May 2004) 6. In a large survey it was found that there is disillusionment amongst owners of family firms. 46% of owners of second or later generation firms were prepared to dissuade their children from setting

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Stakeholder March2006

up in business.

2. (Source: The Sage Business Heartbeat Survey, conducted by YouGov, July 2004) 7. Regarding succession family firms are not prepared as well as they could be with 57% having no defined plan although 39% expect the CEO to retire/leave within the coming five years.

2. (Source: Leadership, culture and change in UK family firms. London Business School research in partnership with IFB, sponsored by BDO Centre for Family Business, 2003) 8. Estimates suggest that the majority of intergenerational business transfers fail particularly in earlier stage family companies.

Problems in the succession process often result in the company either being sold or not surviving.

9. The primary constituency where family firms are represented is in the small business sector. Three out of five firms with turnover of £5m or less are owned or managed by related family members.

2. (Source: Barclays Bank survey,' A Family Affair', February 2002) 10. In a survey of the UK franchising industry it found that 81% of firms involved married partners. Many franchises are now being run as family businesses and many next generation family members see the franchise business as a good opportunity to gain practical work experience.

10. (Source: NatWest/British Franchise Association Franchise Survey.)

11. There is more likely to be a woman at the head of the family business compared with the general trend in firms. (Source: Barclays Bank survey,' A Family Affair', February 2002) 10.

(Source for fact: Institute for Family Business) S

Rachel Allen Rachel joined The Leadership Factor in 2005 after twelve years with Dalesman Publishing. In various account management roles she worked with a diverse range of large organisations including WH Smith, ASDA, Tesco, Sainsburyís, Telegraph Group Newspapers, Waterstones, Borders and many others. At The Leadership Factor, she is currently working with clients such as Direct Line, Sainsburyís Convenience, Royal Bank of Scotland, Shop Direct, seals and sealant manufacturer James Walker, publisher William Reed and domain name company Nominet. www.leadershipfactor.com email:rachelallen@leadershipfactor.com

‘When It Hits The Fan’ Michael’s latest book, is a comprehensive and logical new guide to handling crises and issues. It includes a wealth of practical guidance, a test-your-own crisis skills section and 10 indispensable action checklists.

‘Those who heed Michael Bland’s counsel and apply his collected wisdom will find that many perils can be identified and corrected before they needlessly put an organisation at risk.’

Norman R. Augustine, Former Chairman, Lockheed Martin Corporation

Corporate Communications Crisis Management Creativity Stress/Motivation

Media & Presentation Training

Michael Bland Communication Consultancy, 3 St Mary’s Road London W5 5RA

Tel +44

(0)20 8752 1965

Fax +44

(0)20 8354 5222

Mob +44

(0)7974 365585

www.michaelbland.com info@michaelbland.com

Employee

David Lloyd Leisure (David Lloyd) is the UK and Ireland’s market leader in Racquets, Health and Fitness Clubs. Its mission is “Inspire for life”. Currently 67 clubs provide facilities that include indoor and outdoor tennis courts, indoor and outdoor swimming pools, state-of-the-art gymnasiums, group fitness sessions, beauty salons, cafés restaurants and crèche facilities. David Lloyd is a subsidiary of Whitbread Group plc (Whitbread) and has over 350,000 members. It employs 5,200 people.

A

chieving David Lloyd’s mission is about delivering results to three groups of stakeholders: employees, members and investors – and in that order. In the words of Louise Smalley, HR Director of David Lloyd:

it’s based on balanced scorecard principles. At David Lloyd, WINcard and the Club Annual Operating Plan, together communicate to everybody what’s expected of them. David Lloyd’s Club WINcard (Figure 1) is prominently displayed in every club and people can see at a glance progress towards performance targets for each of the three groups of stakeholders.

BY TAKING CARE OF OUR PEOPLE, OUR MEMBERS WILL HAVE A GREAT EXPERIENCE AND WANT TO COME BACK, WE WILL DELIVER STRONG FINANCIAL RESULTS FOR OUR INVESTORS AND SUSTAINABLE GROWTH AND NEW CLUBS FOR THE BUSINESS.

Engaging people

In this article, Ray Robertson, Director, of Strategic Reward looks at how David Lloyd achieves this through:

But success at the company is not just about WINcard and the mission statement. People must “feel the difference” and that means leaders creating the right environment for team members to create great member experiences. So David Lloyd created “Spirit to Inspire”.

The three day programme is attended by the management team of each club and is held at a nice location so the team can get away from the daily distractions at their club. Spirit to Inspire was designed on the basis of research into what team

members were saying about working at a club, what members were saying about their experiences and the value-profit chain concept. Spirit to Inspire is run by Regional Managers who have been trained to deliver the programme, with support from HR. The programme includes presentations from David Lloyd Board members, and leaders make extensive use of training videos, quizzes, games and exercises which are designed to encourage people to work together to create great member experiences.

Before going on Spirit to Inspire, all members of the management team complete a personality type exercise and, using a standard set of questions, audit their club’s performance against the Annual Operating Plan.

Day 1 is all about communication and teamwork. A Board member sets the context within Whitbread, and managers share their personality profile and perceptions about different aspects of work at David Lloyd and how this affects their behaviour towards to colleagues and members.

Figure 1 The Club WIN card at David Lloyd Leisure Team Turnover

People who understand what matters most to club members and “want” to deliver it Opportunities to discuss performance and develop their career Rewards linked to performance and contribution.

No critical failures on health and safety, and food safety

Our People Club Profit Bottom line Club profit

Brand Standard (Under development) Will reflect audit of our standards and statutory obligations

Our Our Investors Members

Defining what matters most David Lloyd, along with all other Whitbread brands, has adopted a common approach to defining and measuring the things that lead to business success. The approach is called “WINcard” (Whitbread In Numbers) and

Health & Safety

The number of employees who left the club during the past year

Like for Like Sales Period over period change in total net sales

Member Count Number of members

Member Recommended Measured by member survey

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Employee

Day 2 is about leaders and brands.

Managers say what they think makes great leaders by looking at their own experiences in, for example, work or sport. They give their perceptions of wellknown brands such as easyJet, BMW or McDonald’s, even though they may not have experienced them. They then build up a picture of the David Lloyd brand promise.

Day 3 is about service delivery. What does the David Lloyd brand promise mean from the moment a member arrives at their club to when they leave after a game of tennis or work out in the gym?

What are the principles of brilliant service?

How can we recover from poor service?

One week later, the management team goes on a one day follow up where they present their action plan for delivering Spirit to Inspire to everyone back at their club, within 90 days. They are given facilitation skills for cascading the programme in their club but they decide how to cascade. This flexibility has been a major factor in engaging employees at club level, in the core messages from Spirit to Inspire, and making it relevant to their day-to-day work.

Reviewing performance – developing people David Lloyd guarantees that everybody will receive a performance review. This commitment is measured though its “Views” employee survey, which is carried out every six months.

Managers Managers have two main reviews a year, when their performance is assessed against the seven specific WINcard measures – team turnover, health and safety criticals, brand standard, member recommend, like for like sales, number of members and profit. Performance is rated on a five point scale defined as Outstanding, Exceeding, Achieving, Growing and Unacceptable. A key outcome from performance review is a personal development plan (based on Whitbread values – The Whitbread Way)

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Stakeholder March2006

which focuses on building strengths and priority development needs.

Managers also have a career / potential review every six months. This is designed to develop managers to their full potential and provide a pool of talent that supports succession planning, not just in David Lloyd, but throughout Whitbread.

Potential is rated on a ten point scale which defines the readiness for promotion /development and takes account of a manager’s judgment, influence and drive.

Team Members For all other people, such as Lifeguards, Membership Advisors, Head Chefs, Hospitality Staff and Health and Fitness Coaches (collectively called Team Members) who work in clubs, performance review is a simplified version of the process for managers. Its focus is the team member’s achievements last year and agreed actions for the coming year.

their next role, within their current department or in another department.

This is an important aspect of succession planning at David Lloyd.

Agreed actions for the coming year relate to the club WINcard, Whitbread Way and Club Annual Operating Plan and follow the SMART principle: Specific, Measurable, Agreed, Realistic and Time Based. The completed Performance Review – rating, career development, manager’s comments and employee’s comments – is agreed between the manager and Team Member. The performance rating is very important as it gives an overall summary of performance and it’s used for pay review. Six months later, everyone has a chat with their line manager. This is to provide an opportunity to touch base about how things are going, identify if there are any challenges or opportunities and basically make sure everything is going well.

Rewarding performance and contribution

In preparation for the Performance Review meeting with their manager, Team Members complete a review form that includes two sections called:

David Lloyd’s reward strategy has a strong performance focus. It delivers this in three ways:

“How was it for you?” – aspects of work giving the most satisfaction, areas to build on, what might help do the job more effectively and things to improve “My Self Assessment” – covers the most important aspects of Team Members’ work (based on Whitbread values – The Whitbread Way). The areas are:

Through pay review – which takes place annually for everyone (we look at pay review for Team Members) Through bonus – this applies to Managers only and is linked to WINcard Through “Team Workout” – rewards for what team members do to deliver great service to club members.

Caring for Members Passion for Winning Continuous Improvement People and Team Work Appearance at work Punctuality on: shift/meetings/appointments Job knowledge Reliability Managers decide an overall performance rating for each team member they review, using the same five-point scale in their own reviews. They also consider if the team member is ready for promotion to

Pay review for Team Members Each job has a pay scale which has three defined points – base, middle and top.

These are benchmarked against relevant organisations inside and outside the hospitality and health and fitness industries. But because market pay varies by geographic location in the UK, David Lloyd has created pay zones – there are three in the UK. Each club is allocated to a pay zone on the basis of recruitment difficulties in the Club’s location. However, if a club is experiencing considerable difficulty recruiting the right person for a

Employee

specific job, there is flexibility to use a pay scale from a higher paying zone.

Pay review is based on two things: performance rating and where the Team member is paid in the pay scale for their job. A Team Member rated Outstanding, but paid below the middle, for example, will receive a higher increase than someone rated Growing, but paid above the middle.

Bonus opportunity for managers Managers at David Lloyd have the opportunity to earn a bonus through their personal and team efforts. Bonus is based on achievements against the Club WINcard targets and the company uses “traffic lights” to measure actual performance. This works as follows: Green = target or better Amber = better than last year but below target Red = below last year and below target Bonus potential varies between the three management levels: a General Manager can earn up to 100% of their salary and Heads of Department / Club Support Managers can all earn up to 25% of salary. Bonus has three different elements as outlined below: Bonus for “Going Green”: bonus is payable only for “Going Green” on bonusable WINcard measures, such as Like for Like Sales or Member Recommend The Stakeholder Stretch: When a Club has reached 96% of club budgeted profit (for Club Support it’s when the Company hits 96% of budgeted Economic Profit) an additional bonus is paid .

additional bonus.

Team rewards for delivering great service to club members The number of members at any one time is one of the easiest guides to the health and success of a David Lloyd Club.

Members might well be impressed by the great facilities, but it’s the people and their service skills that make the real difference.

Those members enjoying their visits and appreciating great service are the ones that will recommend the club to their friends and colleagues. So, David Lloyd has a reward scheme called “Team Workout”, which is about what team members will do to help their club deliver a great service to members.

At their Performance Review, team members look at the priorities for their Club and team and agree with their manager what they will do in the coming 6-12 months to help meet WINCard targets. If, for example “get the basics right – service to members” is the priority, team members on reception might aim for a score of 85% on mystery member standards by treating every member like a VIP. Other team members might decide “when a member is within 5 metres of me I will greet them”, or “every time I speak to a child member I will make eye contact at their level”.

members. The payout for meeting targets in the first and second quarters is £25, £15 and £5 respectively. Payout is doubled in the third and fourth quarters.

Rewards for part-time team members are pro-rated. Team members can track progress by looking at the Club WINcard, which shows the quarterly target and the results month-by-month.

Business outcomes The business results are impressive, as Sharon Quinn, HR Manager-Reward, explains: “Team Workout has had a very positive effect on Company results.

Recent employee opinion surveys show that 96% of people have a clear understanding of their responsibilities. In addition, team turnover has improved by 10 percentage points, year on year, and 55% of our members make specific positive comments about our people”. S

Raymond Robertson Director Strategic Reward Ray can be contacted at team@strategicreward.com

Success is rewarded for hitting the club’s quarterly target on the number of members. The rewards are £150 per year in “Leisure Vouchers” for full time team

The Pence-in-the-Pound Driver: This applies to General Managers and Heads of Department only. If the budgeted club profit exceeds 106%, for every pound earned over 106%, the manager will earn

Stakeholder March2006

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ANNUAL CUSTOMER SATISFACTION & LOYALTY CONFERENCE

2006

Customer

06

20

CONFERENCE

The Leadership Factor’s seventh annual conference on ‘customer satisfaction and loyalty’ took place on 2nd February. This year, like the most fickle of football fans, we abandoned Man Utd. (location for last year’s conference) and took up with Chelsea.

Robert Crawford - Left Institute of Customer Service Nigel Hill - Right The Leadership Factor Robert kicked off (sorry!) the day by introducing the ICS and its work, covering the ICS model for world class customer service and its benefits in terms of

Reputation Performance Growth Profitability Trust Robert discussed some of the tools organisations can use to achieve world class customer service within three broad

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Customer

categories - People, Processes and the organisation’s Strategy and Culture.

Finally he discussed the problem of assessing how good service is. He introduced the ICS’s SERVCHECK tool for internal assessment, but the key question is what do customers think about your service, which can only be measured by a robust survey of customer attitudes.

customer satisfaction that we’ve ever seen.

Each organisation should do a survey like this of its own, after having determined through exploratory research what the requirements of its customers are. But something that has been lacking is robust comparative data about what the requirements of customers are in different sectors and regions of the UK. The Leadership Factor has just finished a study, conducted on behalf of the ICS, into the things that customers most value in their suppliers, and Nigel took over to present the findings.

Listening

The most surprising conclusion was that, in terms of average satisfaction, the best performing sector was not retail, leisure or financial services (though these all performed relatively well), but smaller scale personal services which are necessarily fragmented. Hairdressers, plumbers and other personal services typify this sector, and their need to create good experiences with and for their customers shines through in high satisfaction.

Graham spoke about the journey his team went through in terms of six stages:

Igniting change Driving forward with customer satisfaction as the key measure of success.

Having no preconceptions, using independent measurement of customer opinions and listening to the comments as well as the score.

Making change happen measurement at both Chelsea and Manchester United - so far as we know the only clubs that undertake formal measurement of the way their fans see the match day experience.

Peter sees fan satisfaction as a key part of being a top club and also a viable business. He is adamant that it is by thinking of fans as customers that Chelsea will be able to win the Premiership at the same time as being run as a profitable business.

Graham Parker-Gore VISA Europe

Stakeholder March2006

Customer satisfaction as a key part of bonus calculations. Communication and focus from tracking customer satisfaction measurement.

Uniting the strategy Delivering training where needed, making realistic Service Level Agreements and amending processes where required.

Recruit for attitude, train for skills. Identify knowledge gaps and train where necessary.

Graham finished by outlining the way he sees service - and it’s all about trust.

Customers trust the front line staff they come in contact with more than CEOs and managers, so the adage that “first to know is best to deal with” is definitely true. For that to happen we have to empower and trust our front line staff. Look out for a detailed interview with Graham about their journey in the next issue of stakeholder Satisfaction.

Peter Kenyon Chelsea FC

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Maintaining focus - gaining accountability

People

Nigel’s conclusion was that, as we move into an era in which all businesses are service businesses, we need to learn lessons from the delivery of personal services. Rather than trying to cut costs and apply manufacturing principles of efficiency and mass-production to service delivery we need to personalise and enable staff to deliver a tailored experience to meet each customer’s needs.

For many people, the most anticipated speaker was the local boy, Peter Kenyon.

Peter Kenyon spoke about his experiences with fan satisfaction

Picking a few Priorities for Improvement, then splitting the team into three groups each focussed on one of the PFIs. Do something quickly is the most important thing.

Graham spoke with great passion about the way his customer service department went about achieving probably the greatest single year improvement in

BJ Cunningham It would be fair to say that BJ has had a colourful life. He introduces himself as an entrepreneur, which means he’s “never

Customer

had a proper job”, and has started a number of innovative, off-the-wall and successful businesses. BJ started off by describing how he set up a classic car import business in his early 20s. He bought a car in the US, brought it back to the UK and the customs guy offered him twice the amount he’d paid for it. BJ agreed, went back to the states and bought 2 cars...and before he knew it he had a business. He admits that he was fantastically naive: running the business from his personal bank account, and assuming that business was easy - you just keep doubling your money! At the time he thought he had it all figured out, and was doing very well - nice house, nice car, nice girlfriend...and a dog.

Sadly the government had other ideas, and changed the tax laws for collectible cars just as a shipment got stuck in the Panama canal. Suddenly BJ found himself without house, car or girlfriend, and with a £876,000 personal overdraft.

He still had the dog though. Where other people might have given up, BJ’s response was to borrow £250,000 from the bank and set up a cigarette brand. But how to differentiate in such a saturated market? BJ’s maxim is:

WHEREVER THERE IS A HIDDEN AGENDA OR AN OUTRIGHT LIE THERE IS THE POTENTIAL FOR PROFIT

The big unspoken truth in cigarettes?

They kill you. BJ’s answer? DEATH cigarettes - the honest smoke, utterly open about the health dangers. As one of their billboards said “13.5 million smokers will admit it’s bad for them. Only one tobacco company will”.

There’s differentiation - truth in branding.

Many delegates already knew Guy from his columns in the Guardian and the Daily Telegraph and books such as the classic “Never hit a jellyfish with a spade”. This presentation was an opportunity to peek inside the (fictionalised, I hope) workings of his creative agency “Smokehouse”.

Be who you really are

The DEATH story is too complicated, and involves too many court cases, to get into in detail here but it’s fascinating and it’s a great test-case for BJ’s brand strategy.

He boils it down to deciding what your defining thought is, communicating it honestly and clearly and then doing what you said you were going to do. In summary Be who you really are

Guy Browning Finally Guy Browning gave us a wryly humorous take on business practice.

Finally, however, he left us with a serious message that linked back to Graham’s presentation. Great customer service comes from individuals who are empowered and creative, not top-level platitudes about “delighting the customer”. S

Stakeholder March2006

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By Mi

chael

Bland

Customer

I have a recurring nightmare: I am starring in a play and, just as the curtains start to roll back, I realise that a) I have learned the lines to the wrong play and, b) I am stark naked.

Before the men in white coats come to take me away, let me say in my defence that this is apparently quite a common sort of dream for strange people like me and that it is hardly surprising after years of working in crisis management.

For a crisis is a time when you stand naked before your stakeholders - and boy! are they looking at you. When something goes badly wrong - a faulty product, a serious accident, allegations of fraud, environmental pollution, an IT meltdown, hostile pressure group activity, you name it - a very large and very bright spotlight of attention lands on your company or organisation whether you want it or not.

The way you behave in that spotlight could make or break you, for your stakeholder audiences won’t just remember what happened - they will remember what you did about it. This might sound obvious, but the instinctive reaction of top managements when caught with no clothes on is to do what anyone would do in that situation: run away or cover up.

Many of the most reputation-damaging crises of the past have involved companies which have clammed up - and in some cases done nothing at all - in the hope that the problem would go away, overlooking the fact that while they are doing and saying nothing the damage done by rumour and speculation is running out of control. Some classic examples include the reputational damage suffered by Distillers Company after Thalidomide, Pan Am after Lockerbie and Exxon after the Valdez.

Conversely, several companies have not only recovered their reputations in a crisis but even enhanced them. Examples here

include Johnson & Johnson’s response to its Tylenol poisonings, British Midland after the Kegworth air crash and Shell’s rapid and caring response to an oil spill on the River Mersey.

Given that reputation is arguably the most important asset of most organisations, and considering the scale of the resources that are poured into developing that reputation, surprisingly little is done about protecting and rescuing reputation at a time of crisis. Yet there are simple procedures to adopt both before and during a crisis which can make all the difference between sinking in the mire and coming up smelling of roses.

The hardest part is convincing senior management and other key decisionmakers such as corporate lawyers that successful crisis management is more of a psychological discipline than a procedural one. If the organisation responds rapidly in a human way the fuss will usually die down more quickly, but it is difficult to get hard-nosed business leaders to buy into this concept. This is why crisis management works best when it is training-led rather than simply preparing a plan and getting management sign-off.

This leads to the next difficulty: the right level of planning. Eisenhower said that in battle he found plans to be useless but planning essential. Huge crisis manuals full of precise details about who should do what and with which and to whom never work in real life, yet some degree of planning is important.

The best way to approach crisis preparation is to ask yourselves a series of key questions. In developing the answers relevant to your company you are developing a workable crisis communications plan. These are the questions:

What crises could hit us?

Meet every few months for a crisis

management session and look at what crises have been in the news: could they have happened here? If so, how would we have coped? In what ways might you be exposed to the risk of a crisis: chemicals, machinery, health, environment, sabotage etc?

Who are the audiences?

List all the possible audiences with whom you may have to deal. In a real crisis you will probably have to communicate with all or most of them.

The main criteria for identifying an audience in the planning stages are: Who would be affected by the crisis?

Who could affect us?

Who needs to know?

Clearly, your key stakeholder audiences such as customers, employees and the financial community will be paramount here, but when you really sit down and assess who you will need to communicate with in a crisis you will find it is a mighty long list!

How do we communicate with them?

What methods of communication do you have in place to be able to inform those audiences immediately and effectively?

Regularly review your internal communications to facilitate early warning of impending crises and issues. In most cases, someone within the organisation saw it coming but didn’t think to report it (or wasn’t listened to!).

What are the messages?

Obviously, the information you put out will depend on the nature and stage of the crisis at the time. Nevertheless, having identified in advance the types of crises, audiences and communication methods, it is possible to anticipate a number of ‘core’ messages, such as what’s happened; care and concern; what we’re

Stakeholder March2006

25

Customer

doing about it; reassurance; positive track record etc.

If the management team agrees these messages in advance it will save vital time when the crisis happens.

Who will Form the crisis team?

Identify, brief and train your spokespeople and communicators. In a really big crisis especially an international one - you may need the services of a specialist PR company and/or a call centre (helpline).

Have you identified and briefed them?

What resources and facilities will be needed?

Think of where the crisis team will meet and all the communication facilities you will need.

Training What training can members of the crisis team undergo? Are crisis rehearsals feasible? At the very least: Test the call-out procedure for the crisis team and reserves The crisis team and other relevant people should undergo crisis awareness training Spokespeople must undergo media training.

26

details will leave the crisis team short of vital guidance.

Probably the best combination of crisis preparation is: Awareness training/briefing for senior group/company/plant management.

Updates.

Media training for spokespeople.

Refresher training.

Regular management meetings to keep abreast of crisis identification, preparation and procedures.

A simple instruction to all staff on how to respond to a call from the media.

Update and re-issue it regularly. Try to back the instruction with some form of education as written instructions are soon lost or forgotten.

A brief manual containing the corporate philosophy, essential advice and relevant checklists. This should be a working tool to be used by people who, via training, already know what to do, not a vast prescriptive document which is opened for the first time when the flames are lapping round your feet.

And stress management training can help your team to cope with the often enormous stress induced by a crisis.

In other words, the crisis manual is never treated in isolation.

It is simply a supporting part of a programme of training, meetings, brainstorming and exercises that combine to provide the best and most flexible preparation for a crisis - and which help senior management to adopt those all-important right attitudes.

The crisis manual

Does it work?

It is probably impossible to pitch the manual exactly right. If you try to anticipate every type of crisis and include all the details and instructions that everyone will need, it will be a huge, unworkable document. People do not have time to thumb through hundreds of pages in a panic to find out who does what. But too few instructions and briefing

Now that you have a crisis procedure in place, check its viability and efficiency.

Establish an emergency call-out procedure for assembling the crisis team in a hurry. If possible, test it occasionally.

Crisis simulation exercises can be useful for spotting weaknesses and honing responses.

Stakeholder March2006

Bridge building The better people know and understand you - both personally and as an organisation - the less inclined they are to want to damage you when things go wrong. It is well worth developing a preemptive communications (PR) programme with MPs, authorities, key journalists, the local community, support services etc.

So, you’re as ready as you can be to protect your reputation through fast and effective communications in a crisis. Now all you need to know is what to do when it happens! The recommended actions at a time of crisis are:

Holding action Try to do something to seize the initiative and ‘freeze the action’ as far as possible.

Examples: Stop production Close plant Product recall Announce immediate, independent investigation.

And make these actions visible. Just ‘doing something’ isn’t enough - your audiences need to see that you are doing something.

Holding statement Decide, approve and immediately issue a holding statement containing some or all of the key messages. Promise to keep the media and other audiences thoroughly informed as soon as more details are known - with a time if possible.

Assemble the crisis team and assess the situation It is absolutely essential for a core group of the crisis team and top management to sit down as quickly as possible, isolated from the crisis and the ‘phones, and take a cool, strategic look at the situation.

Customer

Identify the audiences Give reassurance Go through the audience checklists and ask: Who Who Who Who

is affected by this crisis? can affect us? needs to know? else should be informed?

Remember that audiences need reassurance that everything is under control and they are not in danger.

Resist combat

Thoroughly brief everyone involved (including security, switchboard, reception etc) - and keep briefing them.

Easier said than done! It is often hard to be polite to an irate public figure ‘demanding to know’ or to resist throwing a brick at a press photographer climbing a drainpipe to get photographs. But you must always be polite and dignified.

Centralise information

Be flexible

Ensure that all information comes into and goes out from - a single source throughout.

A crisis can twist and turn. So can the requirements of your audiences especially the media. You may have to adapt the plan and re-brief people several times.

Brief relevant people

Understand your audiences When communicating with hostile or frightened audiences you have a tremendous attitude barrier to overcome.

And attitude barriers are strengthened, not weakened, by counter arguments, statistics and defensive messages. You can only hope to get through to an audience when you show that you see the situation from their side.

A useful crisis/issues maxim is: First deal with the feelings and then deal with the problem.

Think long term

Give information Information is your most useful tool (and defence weapon). Give the audiences a regular flow of as much information as you can possibly release. That way, you will fill much of the information gap with your side of things. If possible, provide background information about the company, about safety standards etc.

When it is over, examine: What you have learned from it.

Will the publicity return, and when? eg: - Anniversary - Legal battle (especially if specialist disaster lawyers are involved) - Aggrieved victims - Inquest - Report

And when you issue information to the media remember to keep your own staff (and other relevant audiences) fully informed.

Be well prepared in advance for these stages.

If the media have ‘good’ (ie unpleasant) photos and footage of the

It can be tempting to try to protect some short term interest - and pay for it later.

But it is often best to be prepared to take a short term loss to protect your long term reputation. Ask yourself: ‘How will our public see us a year from now when they look back on this episode?’

What have we learned?

original incident they will seize every opportunity to re-fill the pages and TV screens with them.

There may seem to be a lot to remember here but most of good crisis management is common sense and some of the best managed crises have been the result of a single, simple action by someone at the top.

And although a crisis can be a threatening and testing time, it is usually an opportunity to shine, too. When a London pub was voted ‘Worst Pub in London’ by Time Out magazine it put up a big banner proclaiming that it was officially the worst pub in London.

Takings soared. S

Michael Bland was formerly communications head of the Institute of Directors and Ford Motor Company Limited. He has trained and advised many of the world’s largest companies and organisations in crisis management, media interview techniques, presentation skills and stress management. He is the author and co-author of 13 leading communication text books and guides including his crisis management text book: ‘When It Hits The Fan’.

Further information on:

www.michaelbland.com

Stakeholder March2006

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One-day

management workshops £175.00

A series of 6 dynamic workshops designed to provide participants with the latest tools and techniques for successfully managing people.

Seminar Leadership

Date

Communicating Effectively

23rd March 23rd May

Performance Motivation

7th March 6th April 6th June

Working with ‘Difficult’ People

21st March 27th April 20th June

Personal Power & Effectiveness

4th April 4th May

Working Successfully as a Team

8th March 7th April 7th June

9th March 9th May

To receive a detailed agenda of the courses above call now on: 01565 724200 JPD Group Ltd. The Station House Plumley Knutsford WA16 9RX Tel: 01565 724200 Fax: 01565 723800 Email: train@jpd.co.uk

Latest Thinking

When giants clash On 25th October 1946 at 8.30pm in room H3, the Gibbs Building, King’s College, Cambridge, an emotion-laden, and some say violent, encounter took place between the rival philosophers Popper and Wittgenstein . To this day no one can agree what happened between them in a meeting that lasted just 10 minutes. This is all the more astonishing because the events took place in front of an audience of philosopher academics trained in theories of knowledge, understanding and truth. One of the protagonists - Popper even got the date of the meeting wrong in his own version of events - a version denounced by a follower of Wittgenstein as “false from beginning to end”. Did Wittgenstein really threaten Popper with a poker or was he just waving it about to make a point? (ref 1) Some 60 years later, we know the bare facts of time and place but there still is no account of the event which commands universal acceptance.

Strong feelings present problems. We can all feel bruised and sometimes threatened by confrontation and violent words even if they stop short of action. The senses are overloaded and so it is not surprising then that memories of encounters strongly charged with emotion differ amongst those that were present - each person giving their own version of events.

A role for reason?

Organisational decision making is founded on an assumption that rational men and women can come together to make decisions using careful arguments based on fact. They want to be as objective as possible. In this context, do emotions make any sort of contribution or as in the case of the Wittgenstein and Popper meeting, do they just get in the way of a rational assessment of what went on?

This issue often arises in complainant satisfaction surveys where what can be deep emotional memories are mined to understand the experience of complainants and to define what needs to be done to improve that experience. Can managers trust the data? This article looks at the answers to that question

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Stakeholder March2006

using data from a survey done in 2005 for a hospital complaints department.

Complainant research, as we noted at the beginning, is charged with strong emotion. Indeed complainants need an emotion like anger with escalated complaints where they have had to persist and push to get the hearing they feel they deserve. Also in a hospital, the issue may well arise from a death of a close family member. “I sincerely hope that no member of my family or friends is ever admitted to this hospital. Your negligence killed my mother- and to have to watch for 3 months just how shoddy your hospital is run has opened my eyes to a world that I never thought existed. Disgraceful- is what I think”.

Dangerous territory Strong feelings are one problem. We now face another technical one.

Complainant surveys on matters that have been escalated beyond the front line and the initial attempts to resolve often involve relatively small numbers of complainants.

In this case, the sample was drawn from all closed cases in a 17-month period and a sample size of 136 closed cases was achieved with 38 people responding. This is a very small sample.

So now we face two important problems - a small sample and answers given under the influence of strong emotions. This is dangerous territory.

A look at the type of questions and the data gathered may provide us with the beginnings of a map through these difficulties.

The questionnaire used gathered data on a number of areas - the demographic characteristics; the stimulus for the complaint and the story of the experience; judgements based on feelings about the process gone through and future actions like recommending others to complain.

Acknowledging the limitations of our data The demographic profile is our equivalent

of knowing the date and place of our philosophers’ meeting. People have a choice whether or not to share their personal data and if they choose to do so, we may presume they have no interest in giving false information. The question here is not then about the validity of the data but of deciding what to make of that information.

We certainly need to be cautious when using the demographic data. In complainant surveys, ‘representativeness’ can be a red herring. Complainants need not be representative of anyone but themselves. However here it was clear that we were hearing from a very particular part of the population. For example, 91% of those who returned a questionnaire were female. Over half owned their own homes. Most were British-born Christians. This is not a picture of the part of London where the hospital is situated. The findings confirm that the people who chose to take a complaint on up the ladder in any environment and ‘market’ are on the whole amongst the more socially confident and articulate members of our society. We must acknowledge that the information has its limitations and cannot be used to understand the experience of a wider set of patients. It is however ok for our purposes which was to gather some information about users of the escalated complaint system.

Cross checking for validity Prior to our survey, the management had no complainant-based data at all and so these findings gave them information that they had never had before. However can they be confident that the data represents reality if so few have provided it?

Here there was a way to check validity. The hospital had been gathering ‘cause’ data from the complaints handled. These confirmed our findings from the survey. 33% of the people who answered felt that the doctors had made a a mistake in diagnosing or had missed what was wrong. The next most important problem chosen by 21% was the poor attitude of staff (doctors, nurses). The hospital data confirmed that these causes are, sadly, the hardy perennials of health service complaints.

Latest Thinking

No. % Attitude of staff (doctors, nurses) was poor 7 21 Felt that doctors had made a mistake in diagnosing/missed 11 33 what was wrong

But cross-checking the survey findings against internal information gives an important reassurance that we are on the right track. What the quality manager needs to understand now is whether easier victories are available - the smaller, apparently less important problems that could well be easier to fix?

Multiple Problems in one Complaint People ticked the boxes for 23 other problems indicating the multi-dimensional problem mix in the complex hospital environment revealed in these comments “In this year (2005) you have had the following continuing problems. Your disabled toilet facilities for outpatients are excellent but those for inpatients are largely of an unacceptable standard.

There are still no bath (bathing) facilities for disabled inpatients. 50% of the inpatient toilet/bathrooms are of poor standard + some frankly unhygienic. The refurbished ones are lovely. In February your kitchen ran out of kosher food. Your healthcare assistants do not care enough about whether a patient is fed; can eat unaided; can open food packages; has fresh water or other fluids if recommended by doctor.

There are shortages of pillows. Linen comes back from laundry with old dressings and excrement still on it.”

Not definitive but indicative The numbers of people in our survey are too few for quality managers to be absolutely certain that the problems mentioned by our sample are those that would be picked by all. But they now have a shape to the consumer experience and can start accumulating data on those other problems where progress is possible. The longer catalogue of ‘smaller’ quality failures as perceived by the patient offer richer and potentially more productive pastures for service quality improvement action.

Glimpses of process What about the process itself? What guidance does the complaint manager get? In contemplating the findings about the narrative of this particular escalated process, we were reminded how little of the process the complainant actually sees or is involved in as opposed to being present as a patient or a frequent visitor to a ward or clinic. They had to guess what was going on and cannot answer questions about parts of the process they have not experienced.

A doctor on the ward/ at the clinic A solicitor Citizen’s Advice Bureau/ICAS

3%

5% 18%

18%

My GP

26%

Other (please tell us who)

Staff on the ward The consultant treating me The PALS service at the Homerton

The opportunities for resolution opened up by this data are important and a

26%

Friends/family

Staff at the Appointments dept

The really useful data from this part of the survey came on that complaint process stage prior to its escalation to the complaints office as a formal written complaint. When asked whether they had talked to anyone about their most serious problem before coming to the Complaints Department, 77% said they had. Some had gone to sources outside the hospital such as a solicitor or the Minister of Health and their MP but for the most part, they went to someone in the hospital. The hospital has a chance of pulling the complainant back from the formal procedure. 19 of the 26 people who answered this question said they had contacted someone at least once and 4 of that number up to three times.

3% 21%

29%

18%

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31

Latest Thinking

valuable insight into how hospitals can work with patients to minimise escalation and how much faith patients continue to have in a system that they abandoned reluctantly to take up their complaint formally. Again the numbers are less important than the general guidance on behaviours and the definition of an opportunity to intervene.

We have now seen that feeling strongly about a problem does not impede people from giving a good account of what happened. Did the survey offer a comparable insight into what the complainant felt about the process as a whole?

Complainants want to believe this but the system does nothing to reassure them and this arouses strong feelings.

Learning points Managers need some space to consider the results calmly. A research project done a little time after the event will still uncover as it did here, sad and painful memories but the complainant is not standing over the complaint manager with a poker. So there is some space and time for learning and for improvements to be made. The learning points are:-

Don’t believe the promise The feeling that came through most strongly was the disenchantment and disbelief of the complainant in regard to what the NHS complaint literature and information describe as the central premise and promise of the NHS complaints system - that a complaint would help ensure that things would be improved as a result of complaining.

Draw on existing hospital data, so validating survey numbers by reference to other information

Fairly satisfied

Fairly dissatisfied

Very dissatisfied

Stakeholder March2006

1 .See the book Wittgenstein’s Poker the story of a ten-minute argument between two great philosophers by David Edmonds and John Eidinow pub Faber and Faber 2001.

Even when numbers are small, large

15%

21%

9%

45%

Can it then be a surprise that the satisfaction level is very low?

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Reference

Confront and incorporate emotions by using complainants’ words to demonstrate the feelings and represent the complainants’ perspective

9%

Neither/nor

These elements combine to create data that persuades and recruits colleagues to participate in the team-based or departmental-based action that brings lasting improvement. All that remains is to tell complainants that this has happened. S

Be honest about the limitations of any one particular survey

Final letter: description of how things would improve

Very satisfied

differences can occur that point to a very clear message.

Colin Adamson has worked with customers and the organisations that serve them from a variety of perspectives: marketing brand management; consumer advocacy and information; government at both local and central level; international consultant specialising in customer satisfaction and service. Colin set up the European office of the consultancy TARP Europe Ltd - a pioneering specialist in complaint handling and satisfaction research. He was founder President of the UK’s leading professional organisation for customer service and consumer affairs managers - SOCAPinEurope.

His current principal interests are ‘strengthening the consumer voice’ and ‘escalated complaint handling.’

Colin Adamson can be reached at colin@colinadamson.co.uk 12 Clevedon Court Clive Road London SE12 8BT Tel: 020 8670 0595 Mob: 07785 552167

To get eye catching design and high quality print you need to pay high prices right?

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Customer

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Stakeholder March2006

Customer

The Love Zone, Discretionary Effort, Upside Down Structures, Brain reserves and Funky Business were all talked about during the 5 Star Customer Management Conference held at the EICC in November last year.

Behind all this terminology however lay a more practical message that was often not explicitly made by the speakers but non-the less was repeatedly alluded to during the day. And what was this key message? The fundamental fact that all businesses rely on people, their employees, to actually deliver customer

service. Being able to manage the actions and attitudes of employees is a crucial element of successful business.

The retail environment is possibly one of the most obvious industries where a company’s reliance on its employees is greatest. It is no surprise therefore that two of the best (yet different) examples of how a business can manage its employees came from this sector.

Empowerment Part of Timpson’s success is that they start right at the beginning to employ the best people in the first place. They are clear in identifying the sort of attributes a store manager should have and are extremely focused in ensuring only people with these skills are ever employed.

or a key cut, haggle - the store manager can even do the inconceivable and give things away!

By way of keeping a commercial focus managers also benefit directly in a profit related bonus scheme. This scheme however is not paid out annually or quarterly but every week! This frequency of payment continually reinforces the fact that there is a direct and immediate link between performance and reward.

Ensuring you employ the right people, empowering them to provide customer satisfaction and giving authority to those on the ground has paid real dividends for Timpsons. It has played a significant part in quadrupling turnover during the last 10 years, a result many of us would be envious of.

Build behaviour into how we do business While Richer Sounds do many of the positive techniques just described, Derek Williams focused on another technique organisations can use to ensure employees deliver high levels of customer satisfaction. During a visit to Richer Sounds Derek found that quality and customer service are proceduralised into behaviour.

Every single working day starts the same, a simple paper checklist containing all the minimum standards the store should have right before opening is ticked off by the manager. Key messages

are continually reinforced in a practical way through posters, placed away from customer contact, but in unavoidable view of employees. Using these techniques behaviour is not eroded by apathy but is continually reinforced and maintained.

There is nothing particularly new in either of these approaches, both empowerment and employee procedures were also advocated

by Pete Snowdon from Yorkshire Building Society as part of their customer fairness scheme. There is a trend in business however to constantly invent new ways of working in an attempt be at the cutting edge of management thinking.

The real point of this piece is that successful businesses keep focused on basics, and one of these basics is that customer satisfaction starts at home with employees.

Employ the right people then give them a chance through providing the support, skills, rewards and the authority to make decisions, so they can deliver for you.

You can have all the Funky Business you like but until you get the basics right you’ll never reach the Love Zone. S

Iain Law Client Manager The Leadership Factor www.leadershipfactor.com email:iainlaw@leadershipfactor.com

Empowerment is then the key to success; structures have been put in place to enable the shop manager to run a store as if it was their own business. Authority is given to the manger to immediately sort out problems through making up to £500 is available to settle a complaint.

Published price lists are a guide only next time you need your shoes repaired

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35

Fast guide

Fast guide to “Attracting and keeping staff”

Why people join 1. Company reputation - a good reputation in the market place, a well-known brand or recommendations from friends or contacts are often influential. One employee who took part in a focus group we ran for one of our clients told us “I researched several hotel companies and chose “X Hotels” because it was far more people focused” 2. Competitive pay and benefits - seen as one of the best around, includes a range of flexible working options and gives some choice over benefits, so the employee can select what suits them best 3. Impressed with the people they met during the selection process and the way they were treated - the desire to work with people who are enthusiastic, believe in what their company stands for and are engaged in the work they do 4. Opportunities for personal development - “I knew people working for the company and they told me the training was excellent”.

Why people stay Competitive pay and benefits Great work colleagues - time and time again people say to us...”the friendly people I work with”...“there is a really good team spirit in our department”...“everybody helps each other when we’ve got a special project

to finish for a customer” Having the space to do what they do best - being coached by their manager who concentrates on building their strengths rather than turning around their weaknesses (some may not be for ‘turning’) and encourages them to come up with new ideas and extend the boundaries of their capabilities Recognition for a job done well especially non-financial recognition such as a personal thank you, acknowledgment at a team meeting or an article in the newsletter. This costs virtually nothing and every organisation can give it.

Fair performance reviews - sometimes they are contentious, but they should always be fair, open and honest. Without that, manager-employee trust is seriously at risk, and everybody loses Well defined career paths - these actually live up to the expectations the employee had when joining...“our company does a great job at bringing through and developing people at the lower levels in the organisation”. High performers, especially, look for multiple career paths and a highly involving leadership style.

Why employees leave Poor work-life balance...“having to work long hours is part of the culture here” Lack of involvement or no interesting projects - always doing the most routine tasks, not being given extra work to help other departments out when their workload is low, especially when the employee volunteers

Raymond Robertson Director Strategic Reward Ray can be contacted at team@strategicreward.com Career stagnating - feeling pigeonholed, nowhere to go, even if it’s really a matter of developing a new set of skills Cold shouldered, overlooked, being taken for granted...“people who have been here a long time are not always open to new ideas”...“managers who talk down to you”...“I worked really hard to ensure conference delegates enjoyed their stay, but I had no thank you from my manager” Company moves away from its core values/ethics.... “I was told pay was linked to performance but everybody gets the same pay rise, so why should I bother”.

Importance means different things to different people While these common themes provide a useful backdrop to what is important to employees, there is no off-the-shelf set of reasons that can be universally applied in every organisation. Views about importance vary by factors such as employee group, lifestyle and organisation.

Three key questions for you 1. Do you really know, through surveybased evidence, what is important to your employees?

2. Do you have a reward strategy that reflects the needs and priorities of different groups of employees and is aligned with business goals?

3. Do you measure how “what is important” translates into customer measures and business success? S

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Stakeholder March2006

Book Review

Phil Dourado & Dr Phil Blackburn, Seven Secrets of Inspired Leaders business leaders? Mr Burns and David Brent are two archetypes that shouldn’t be accurate, but too often still are. So what do leaders need to do differently, and what would their businesses look like?

Responsibility is not something you can tack on to the outside, it has to be ingrained in your business. The agenda now is Corporate Social Opportunity Innocent Drinks is a great example of a brand that is built on an ethical basis.

The secrets in summary

Secret 3 They have to want to follow you

Secret 1 Leadership is viral: pass it on Leadership is not management. This doesn’t mean that management is bad and leadership is good, but you can’t lead by managing. Good leaders give others the resources, inspiration and support to become leaders in their own right.

My English teacher used to say that poetry is condensed thought. According to the blurb on the back of the book this is “concentrated leadership juice” which, whilst a slightly disturbing phrase, is pretty accurate. The authors have crammed an immense number of valuable ideas (and real-world experiences) into a very readable format - I managed it in a return train journey to London. Admittedly I live in Yorkshire, not Essex, but that’s still pretty impressive. Does that mean it’s short on substance? Absolutely not. It’s certainly short on waffle, but each chapter is dripping with good ideas, quotes and stories. If you’re anything like me you’ll find your copy will end up doubling in size from all the ad hoc bookmarks you shove in.

The big problem addressed by this book is that most “leaders” are anything but inspired, and miles away from inspiring. A study commissioned by the authors found that the most desired quality in a leader was “inspiration”, but only 10% felt that they had experienced this at work.

Business leaders are still seen as “the boss”. Which figures come to mind as

Capstone

Work-life balance misses point - it shouldn’t be about balancing a necessary evil against “life”, work should be part of your life! If it’s not fun then you need to reinvent your workplace. It’s no longer enough to manage your human “resources” as if they were consumables or raw materials - you need to engage their energy in your business.

Secret 4 Make a difference

The wicked leader is he who the people despise.

The good leader is he who the people revere.

The great leader is he of whom the people say.

“We did it ourselves” Lao Tsu, Tao te Ching

Secret 2 You’re not fooling anyone Truth is the only option you have (resonance with BJ Cunningham’s take on branding here). Ever greater information transparency means that you can’t hope to maintain a sham any more. Set your vision, market it, live it internally and that will flow through to what customers experience.

Corporate Social

Commoditisation and conformity are the bane of most markets. Differentiation is the only way to beat the competition. But innovation often isn’t all that innovative most “new” ideas are merely borrowed from other sectors or other contexts. But ideas are cheap (and easy). The hard part is coming up with a reliable innovation process which controls risk whilst allowing good ideas room to grow before they are evaluated to death. The job of the leader is to “be like Madonna”. No, you can put down the pointy bra - constant reinvention is the key.

DIFFERENT IS HARDER TO BEAT THAN BETTER Secret 5 Lead from the edge All the important action takes place on the

Stakeholder March2006

37

Book Review

BO

OK

W IE

V E

Continued: Phil Dourado & Dr Phil Blackburn, Seven Secrets of Inspired Leaders front line, interacting with customers, not in the ivory towers of senior management.

In the pull economy you need to be at the edge to understand how the customer experience looks and feels from the outside.

WE’VE PUT THE RIFLE IN THE HANDS OF THE DEER FRED NEWELL Secret 6 There’s nothing out there Global business is coming, ready or not.

But that doesn’t mean homogeneity, it means glocal or even multi-local (HSBC’s current approach). If you think about the statistics there is no doubt that jobs are bound to move overseas - with cheap graduates and postgraduates available increasingly the R&D as well as manufacturing jobs will move to India and other new economies. Export jobs or import people is the question in addressing Europe’s aging population.

Secret 7 The impossible isn’t Do the impossible is where innovation

‘THE IMPOSSIBLE’ IS JUST SOMETHING THAT HASN’T BEEN DONE IN YOUR SECTOR YET

38

Stakeholder March2006

(and differentiation) comes from. Fire (creativity)and ice (caution) need to be balanced. Innovation comes from trying things, and being prepared to fail. But that doesn’t mean you have to gamble the farm - practising smart risk allows you to be innovative, and prepared to fail, in firewalled key areas.

Plus the bonus secret - Get an NBA, not an MBA A New Business Architecture - everything from IT systems to hierarchies may be different in an organisation with inspired leadership. IT systems need to be focused on external customer control leadership from the edge again.

HIERARCHY IS AN ORGANIZATION WITH ITS FACE TO THE BOSS AND ITS ASS TO THE CUSTOMER JACK WELCH

The upside-down organisation is still a useful model - leadership is seen as support for the front line. Measurement of soft as well as hard metrics is key.

Our review Taking each secret on its own, there’s not a huge amount that’ll be new here if you keep up to date with your reading. What this book does that is unique is to distil a huge number of ideas into a very small space and couple that with lots of insight from the people who have been there and done it.

This book is an engaging call-to-arms for would-be leaders who want to reinvent themselves and their organisations.

Without question you’ll leave the book with a host of ideas that you’re itching to put into practice in your own organisation.

Best of all, as I write this it’s half price on amazon.co.uk, so you definitely owe yourself a copy!

Web links: www.phildourado.com www.inspiredleaders.com (seems to be awaiting new content at the moment) www.ecsw.com

SOCAP in Europe

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Our members include: Boots The Chemists, John Lewis, Lloyds TSB, Nestlé, Avis Europe PLC, One Railway, B&Q, Kellogg’s, Philip Morris, Procter and Gamble, Habitat, Early Learning Centre Here are just some of the benefits of SOCAP Membership: INFORMATION AND PUBLICATIONS

NEW! Stakeholder Satisfaction - free subscription - published four times a year Customer Management - free subscription - published six times a year SOCAP News - a weekly electronic newsletter distributed by e-mail.

Inspirational Email - a weekly email specifically designed to inspire customer service professionals Information Directory - the SOCAP web site provides access to a wealth of articles and publications relating to Consumer Affairs as well as links to other helpful sites NEW! The SOCAP Journal - Free subscription - published four times a year Membership options: Personal Membership £235 (excluding VAT) Standard Corporate Membership £945 (excluding VAT) Foundation Corporate Membership £1,970 (excluding VAT)

15% discount- for Stakeholder Satisfaction readers!

Please contact Anne-Marie Lose on 01438 310021 or visit our website at www.socapineurope.org for further information

Improving Customer Satisfaction One day seminar £295 (excluding VAT)

Many organisations find it very difficult to improve customer satisfaction. This course explains why some succeed and others fail.

· · · · · · ·

Taking action The 3Rs of customer value Managing customer perceptions Motivating employees Moments of truth Delivering results Maintaining the focus

Manchester

20th March 2006

Birmingham

29th March 2006

Leeds

27th July 2006

London

24th May 2006

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For a detailed agenda please contact Ruth Colleton on 01484 467000 or email ruthcolleton@leadershipfactor.com

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