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Function Not Fashion
By Brian Birkby - Birkby
Lancaster Consulting
Throughout recent history, there have been models. Cromwell’s
new model army, Cadbury’s model village, Porter’s business
model…. to name but a few.
Some models will be ‘fashionable’; they will last until they
have gone out of style. Others will develop and endure if they contain
the essentials of good practice. The concept of the model village, for
example, is being repeated in modern developments. Poundbury, the village
concept supported by Prince Charles, being a recent example.
The EFQM Excellence
Model© is a relatively new model but one which should benefit
organisations for years to come. It does contain one criteria which in
a UK context could be described as challenging. Customer Results is the
highest scoring part of the model and yet it is one area in which many
organisations are notoriously poor. Yet providing excellent customer service,
can achieve real value for organisations.
In 1981 when Jan Carlzon became President, the Swedish airline
SAS was losing £5 million per annum. Competitors were concentrating
on cutting costs, however, Carlzon decided to focus on customer care.
He identified who his most important customers were - business passengers.
He then asked them what they wanted and what would make them use him
rather than a competitor. The most important reason given was punctual
flights.
Carlzon put a monitor on his desk with a program that showed un-punctual
take-offs and landings around the world. When they occurred, he personally
phoned the pilot to ask why. Within a short time, SAS flights became
extremely punctual.
18 months after Carlzon took over, SAS made a profit of £45
million. |
Service Excellence Environment
Organisations that tend to succeed are ones that can turn a negative into
a positive. A low score on the Excellence model is either a stick to beat
people with or a great opportunity for improvement. It depends on your
outlook; ‘can do’ types recognise the benefits. It is much
easier to improve from a 30% to a 50% position, than from 70% to 90%.
The behaviour of people is determined largely by their environment. Understanding
the customers’ view, their experience and perceptions, is a powerful
driver for change. Participation in problem solving by involved employees
and work teams, lightens the load of managers. Individual skill development,
increases motivation and productivity.
The Service Excellence Environment - Argus iii model ©, is a model
which provides directions for improvement. This has a clear focus for
improving customer service through: informing knowledge, involving
people, imparting development.
Don’t waste time satisfying imagined needs
...
find out what your customers really want.
Inform
Developing actions based on this model, leads first to gaining knowledge
about experiences, requirements and perceptions.
How can we ensure that the organisation is meeting customer needs, providing
the service required? It’s not what we think that is important,
it’s what the customer thinks (and wants). Leading organisations
ask the customer. Qualitative research enables efforts to be focused on
the most important issues. Having discovered what’s important, quantitative
research then gains the statistics related to what’s being delivered.
A business-to-business company had conducted questionnaires
and thought they knew enough about their customers. However, the Sales
& Marketing Director realised that to stay ahead and continue
to make a profit, they had to be better than the competition.
They changed to include a more qualitative approach. They had some
focus groups conducted and were astonished at the results. Their quantitative
questionnaires were measuring the wrong things. They came to realise
that, they did not know what they did not know – and that was
commercially damaging.
They discovered a lot that needed changing. One of the seemingly small
points but with large implications was their slogan. It certainly
appeared innocent enough to the company. What customers perceived
however, was totally different. When questioned, customers responded
with ‘Anglo Saxon’ words!. Unbeknown to the company, their
motto was insulting to customers. There were good reasons why, when
seen from an external perspective. The slogan has since been changed,
as have many other important areas of business practice. |
Research by Reicheld and Sasser showed that a 5% increase
in customer satisfaction, led to a minimum 25% increase in profitability.
This is supported by a review of 3,000 UK businesses by Bradford University
and Price Waterhouse Coopers. This showed that where there was good customer
service then bills were paid, on average, two weeks earlier than otherwise.
What gets measured gets done ……
but when quality is measured – it gets done well.
Involve
Knowledge is power. Taking action based only on internal belief means
functioning on supposition. The second consideration is to combine research
with the collective power available within the organisation.
Knowing what customers think can provide the impetus for action and dramatic
improvement. Much research has been conducted on improving performance.
This clearly shows that employee involvement leads to ownership and ownership
leads to achievement.
An optical fibre manufacturer involved groups of employees
in improvements. One group looked into the changeover time for extrusion
machines. Six large bolts held the extrusion die in place and removing
these took time. The group realised that if it could speed up this
particular operation then it would reduce costs dramatically.
Working together as an empowered team, four of the bolts were
cut down in length so that they did not require as many turns to
remove them. The die shape around the two remaining bolts was changed
to a keyhole shape. The bolt would only have to be loosened and
the die plate twisted around slightly to remove it.
Changeover time was halved by these simple changes.
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Service quality is defined by customers and created
by employees.
Impart
Individuals have different levels of abilities and desire to learn. The
final part of the model concerns leaders who motivate and support people
in the improvement of skills.
The majority of younger people have a natural curiosity and interest.
Tutors of older people, frequently comment on the attentiveness of these
students as there is a desire to learn. Whatever the age, having an interest
in and being better at the job, helps security of continuing employment
(the present). Developing skill, knowledge and experience can provide
security of employability (the future). Supporting the evolution of the
organisation and encouraging the development and learning of employees,
is part of every leader’s job.
A group of back-office employees were being trained in problem
solving techniques. The aim was to provide the skills that would
help improve customer service.
There was initial scepticism, the critical success factor of
‘Improving Customer Service’ was perceived as a management
responsibility.
Reviewing the influence that internal customer service had
on colleagues who dealt with customers directly, gained the initial
motivation for skill development. Employees began to appreciate
that many small improvements created a much larger benefit. Individually,
their job enjoyment, skills and employability value would also increase.
|
In a survey by BLC, winners of the UK Excellence and regional
Excellence Yorkshire awards were asked what percentage of pay was allocated
to the development of employees. The survey was conducted across manufacturing,
service, utility and public sectors.
The basis of the Best Practice Training Survey, was to determine the cost
of training and development. To gain consistency, this included bought-in
plus any internal training cost. Organisations were asked to include any
grants that subsidised the training. Excluded, was delegate pay during
the event.
The results were remarkably consistent. Best practice organisations spend
almost 3% of salary on training and developing their employees; twice
as much as the UK average. So how does your organisation compare; are
you competitive?
It can be argued that what is important is the quality of the outcome.
However, the current spend is also half that spent in Europe. These trends
are not good for the development of the ‘intellectual capital’
within organisations
Leadership is like moving a piece of string ...
pull is better than push
Value
Best practice organisations are more likely to succeed through aiming
for excellence. This helps ensure sustainability and provides value for
stakeholders. A simple best practice comparison can be gained at www.birkbylancaster.co.uk.
| Birkby Lancaster Consulting specialise in improving
service to customers through qualitative research, process improvement
with teams, skill transfer workshops and beta™ organisational
review. Birkby Lancaster Consulting may be contacted: telephone:
01484 401739, email info@birkbylancaster.co.uk,
web: www.birkbylancaster.co.uk.
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