“Being nice to customers is new strategy for me”, said Michael O’Leary the boss of Ryanair, as he sees profits climb 32% in the last six months.
“I wish I’d been nicer earlier to customers”, he goes on to say.
This is business Michael! The profit growth must have been attributed to something else, surely there’s no time to show love to your customers. Or is there?
What is the right way of running a business, from both a customer and employee perspective if you truly want to make long term sustainable profits? Whether you are setting up a business or work in a company, this is what I have found by interviewing real people running successful, sustainable companies.
“Companies should focus on being admired. Not just financially successful. Can the company serve society in some way, so much so that it can outlive its founders?”. That should be the real aim.
Companies recently have actually industrialised humanity. The industrial revolution needed a command and control environment. Employees would do the same task day in day out, overlooked by a manager who had been doing the same task with more experience. In a process driven environment this command and control method worked.
But by trying to create very well paid compliant robots just doesn’t work anymore.
As human beings, we are taught to be very rational. But the truth is, we are very emotional. Therefore, leaders can not command people. But they can inspire and value people.
When employees are inspired and valued, they feel important so they feel empowered. When you are able to empower employees they start to engage. Once engaged, employees enjoy what they are doing and so you get increased creativity, and they in fact motivate other employees. They do the hard work for you, releasing energy of top management. All this increases growth, profits and sustainability of the business.
Last week I met with Sudhakar Ram, CEO of Mastek a multinational IT company. Sudhakar told me he measures success in two ways:
1. If the sales force is reducing in size, this shows your business is becoming more successful (since customers are advocates of the company)
2. Are employees happy and thrilled or are they bored out of their minds
“We have scrapped all appraisals. It doesn’t make people happy. So why do company’s do it? We start by giving everyone a top performance rating then ask them to prove why they deserve it. The results are phenomenal. It allows people to stretch out of their comfort zone to achieve much more than they thought they could. Each person then develops a craft discipline, that of a master craftsman”.
When you scrap appraisals there is no way of getting feedback unless you seek it.
Plotting people on a normal distribution for grading also doesn’t happen at Mastek. Seriously, which corporate comedian came up with this distribution method? It always made me laugh. A peer evaluation is much more of a sensible approach where outperformers are identified as those not just with technical knowledge but have also improved the lives of those around them.
What about customers? Mastek notes that only a 1/3 of any project is ever successful in terms of time or cost. This had to change. So they set up joint remuneration goals based on deliverables. The service provider and receiver then work together on projects, rather than blaming each other for project failure.
I also met Mike Smith, a freelance journalist, author and head of Business Programmes at Initiatives of Change UK, to ask if he has heard of anything like this. He came up with a list of ethical business people and social activists. In fact, he liked their work so much that he has written a book about them and their success ‘Trust and Integrity’! This had really started to convince me that it wasn’t an isolated few but vast variety of international businesses that have taken up a culture of service, both to employees and customers alike.
Laughing over lunch with Benjamin, one of the co-owners of Mosob, an Eritrean Restaurant voted one of the top 10 in London, visited recently by stars like Stevie Wonder and Johnny Glover, I asked what is the recipe to his success? How did a poor family moving to the UK, with hardly a shirt on their back build such a successful business? His answer was quite simple:
“I listen to my customers and understand each customer’s needs, individually. I make them feel important not for who they are but what they are, a human being”.
He then played a little game with me where he said assign each letter in the alphabet a number starting with A = 1. If you spell out the word ‘Attitude’, the sum of the numbers equals 100. Your service to your employees or customers is then 100, if that’s positive, that’s 100% positive, if it’s negative that’s 100% negative. There’s no in between.
“The biggest discovery for human beings is that by changing your attitude, you can change your destiny”
Through meeting these people I realised they all had one thing in common. They actually cared about people. As in they genuinely cared. In fact, it’s what gave them strength, I could see it in their eyes when I was speaking to them.
If you truly want to make long term sustainable profits, first be ready to serve humanity.
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Hi, great blog and article. I completely agree with what you wrote. Creating a culture for people to take initiative and be in an environment that promotes growth of individuals is essential in businesses that deal directly with customers. Retail and customer expectations are always increasing, therefore taking on board ideas from your customer facing front line is the only way to keep evolving and really provide customers what they expect and more.
A lot of companies make decisions based on analysis of figures, even in the area of customer service, they then create new guidelines for retail staff to follow. Although a structured approach from management is a great idea, it’s essential not to let it stifle employee growth and ideas. The results I find are better using a structured method to improve customer service where the company states what is required from employees in terms of delivering customer service, and that will incorporate ideas from employees. There is much better engagement when it’s their ideas.
Great comment, thank you Dhiren.
Wow truly inspirational and never thought something so simple could be they key to success so many companies are after! I know I share some of the frustrations you have identified with appraisals in virtually all 4 of the FTSE and DOW Jones companies I have worked for if only they knew. The sad thing is these companies fail to connect with their employees what hope do they have in connecting with their customers!! You need to advocate and spread the message in these organisations (I know I will be) as even though the message is simple most of the best ones normally are but people fail to see or chose to ignore it tthismust be changed! Caring about people wow why didn’t I think of that in the same way I do out of work why change when you step into the office… great!
Absolutely, we tend to forget that at work, we are not workers but human beings. Something gets lost when we walk through the business doors. Even harder, is that we don’t sell to customers, we sell to human beings. We all need to realise, whatever grade we are in the organisation, that we, truly are leaders that can and should enable change.
What can I say everybody likes to feel special, whether it’s work or home , it takes a little thought and time ….to put a smile on someone’s face .
Thanks this a great consciously aware blog. I’m at a company where that fundamental concept of caring for what the customer wants is driving all decisions. Where there is a gap is that they do not apply this to employees. ..if we were referred to as customers of the company I think there would be a far greater level of engagement. like you say its this level of engagement that frees the board to plan ahead and not worry about now.
A great real life perspective. Thank you Ameet for sharing. This is classic scenario. It’s like family and friends. We would focus so much to look our best, always be on time, care and never forget to say please or thank you to friends. But all these mannerisms are lost with family. We take them for granted sometimes. Viewing employees as customers should be a priority, after all, they are the foundations of the business.
You are right, first of all we are human beings and would like to be treated with respect and appraised especially in an organisational environment. The cheapest and easiest way is to get some feedback and praise them for what they have done in the progress of the company and their contribution is priceless. This will improve social relationship between employees and employers.