9

EMPOWERING YOUR CUSTOMERS

By now you are likely either extremely excited about the opportunities that exist for your organization or you are thoroughly depressed about the fact that so many things that you once believed to be true about growing an organization are either no longer relevant or simply ineffective in today’s marketplace and it’s hard to clearly identify where to start. Regardless of your thoughts at this point, my goal in the next few chapters is to walk you through exactly how to shift from where your organization is today in its journey toward (or away from!) growth, to where you would like to be, providing you with a clear road map. We are going to dissect some of the minutest details of how several of the unstoppable organizations that I’ve introduced thus far have made this transition themselves, as well as introduce further similar organizations and discuss how they have progressed through their journey. This will help you avoid some of their mistakes and take the fastest route possible to becoming unstoppable.

Satisfying Your Customer’s Perceptions

Customer empowerment is about satisfying the evolving needs of your customers, providing various incentives and a plethora of value that, in turn, influences your customer’s perceptions about why they should do business with your organization. The strategies and means by which you empower your customers ultimately depend on their needs as we discussed in earlier chapters, as well as relying heavily on creating a sense of personalization for each individual customer. There should be a perception, for example, that you are providing an experience that aligns directly with what your customers need even though they may not be aware they need it yet, while ensuring a distinct, competitive advantage that results in increased revenues and supports ongoing customer loyalty. Before we delve deeper into how to make this happen, let’s consider a few examples.

Amazon, a longtime and well known leader in the online marketplace, has recently been promoting their Prime membership, a low cost annual membership fee that customers can select that offers them free shipping, free two-day delivery, the ability to share the membership with up to four other people at the same address, and more.¹ For Amazon, offering an annual membership fee is alluring because it provides additional and predictable annual revenue that more often than not outweigh the actual costs of administering the membership. However, it also incentivizes customers who join Amazon Prime into using their membership more frequently to ensure they “get value for their membership.” Amazon’s customers weren’t initially screaming for a membership option, nor were any of Amazon’s competition providing something similar. However, by packaging various services and benefits together, Amazon provided a method that empowered their segment of customers who were in fact seeking more cost effective ways to reduce shipping costs and consistently receive goods much more quickly. Clearly, Amazon has done its research to make sure it is on the positive cash flow end of collecting the membership fee. In situations where they haven’t been, increases to the fee have resulted. The membership fee that Amazon instituted was a direct result of providing their customers options that would, in turn, make buying from them a more valuable experience than their competition, while providing Amazon with a slow and steady form of additional revenue.

Another example of empowering the customer comes from McKenna Distribution, a family-owned business run by Steve McKenna. A distributor of flooring and flooring supplies, Steve and his team have long been conscious of what their customers, a combination of flooring contractors and retail stores, are seeking. What they have found consistently is that both of their customer segments have asked for unique products that improve their end user’s experience while making the job of the retailer or contractor easier, be it in installation, competitive pricing, product quality, and so on. Steve has traveled across North America attending trade shows and connecting with manufacturers of products that suit these needs on a regular basis. This search has resulted in McKenna further expanding their product and service offerings to include a new division that specializes in design, fabrication, and installation of custom granite, quartz, and marble countertops; another example includes being the sole Canadian distributor of Wedi Shower Systems² and the first organization in Saskatchewan to carry a unique and natural tile line shaped from marble, basalt, and limestone called Mudtile.³ Not only have Steve, Alyssa, and their team empowered their customers with unique products that satisfy their ever evolving needs, but Steve has also ensured that his team puts on demonstration days on a regular basis that include manufacturers of their unique products, allowing both his contractor and retail customers to connect, discuss, and review their new products, how they are installed or applied, and the unique benefits they provide to end customers. Steve and the team at McKenna empower their customers by not only constantly providing multiple options in the products and services, but also by engaging directly with customers in helping them understand the products, how they are installed, and the benefits they bring.

Several years ago, I was working with a clothing manufacturer identifying methods with which they could further empower their customers. During one of the exercises, I had a group that consisted of employees from various divisions, along with executives and leaders from across the organization, identify what they believed their customers were seeking when it came to how their garments were being delivered and received. The majority of their customers were small retail stores. Once we had made note of this feedback, I asked for the phone numbers of several customers and we reached out to them directly, identifying initially during the call our desire to continue to further improve their customer experience by asking them a few quick questions about their experience with the garments. After several calls, three distinct points arose for improvement:

1. Numerous labels on the boxes, used both for internal identification and shipping purposes, caused customers confusion and forced many of them to remove and re-label products for their own needs.
2. Bags in which garments were individually wrapped to protect from dirt and dust were unnecessary, as every customer we spoke with cleaned and pressed garments upon their receipt.
3. Efforts to expedite garments for next day delivery were unnecessary, as all customers we spoke with were expecting a “rush delivery” to take up to three days in total.

In my experience, it is rare that anyone in the organization is 100 percent clear on what customers desire from its products or services, with the exception of those actually involved in the delivery of such, because it’s at this point that your customers provide their first impressions, and the individual involved in the delivery can speak to their feedback. By connecting the broader organization (including employees, leaders, and executives) with your end customers and focusing on how you can improve their experience with your products or services, organizations can in turn identify what improvements and changes are necessary that will further empower their customers with new and more valued solutions. Empowering customers is all about placing the power of the experience of your product and service into their hands, including their expectations, what would they like out of the experience, and how can you make it better. You’d be shocked at how many companies either don’t solicit this information from their customers, rely solely on feedback from sales relative to this information (and sales are often biased as their goal is to make a sale, not get deeply entrenched in dealing with issues), or they outsource to an agency whose summaries are often dismissed as unrealistic or out of touch with what the organization is capable of. To empower your customers, there is no activity more important than soliciting feedback in person (recall my earlier rant about the lack of value electronic surveys provide) relative to what and how you can perform better.

To do this type of exercise, there are a handful of questions you’ll need in order to flesh out specific information that is actually useful. Ask a customer too broad a question, for example, and you can expect to receive a broad answer. However, when you ask a pointed question and you’re prepared to dig deeper based on the response you receive, you can build a treasure trove of information that can drive your marketing, product development, manufacturing, service levels, shipping, and the like. Here are the questions I typically use in client interactions, each one customized depending on the industry, products or services, and so on.

Customer Empowerment Questionnaire

1. What specifically do you like about our product(s) or service(s)? Can you give me two or three examples?
2. What could we change that would make your experience with our product(s) or service(s) better? How would you recommend we go about changing it?
3. If you were working in our company and could change anything, what would it be?

For bonus questions and other supportive materials, make sure you visit www.unstoppableorganization.com.

I want to point out a few things about these questions before you put them into practice. First, these questions contain multiple parts, and are both specific and broad. It would be difficult for a customer to answer only “yes” or “no” to one of these questions, and that’s the point. Moreover, these questions are best if asked in person, not through an electronic survey. We want to have a dialogue with our customers to dig deep into their perceptions, rather than skim the surface. You’ll also notice that there are only three questions, which may make you think that any response to them would be insufficient. Again, if you ask these questions in a one-on-one and face-to-face situation, you’ll find conversations can run quite deep. My rule when using these questions is that every customer has feedback that would be valuable to know, but some are more forthright in giving it. As a result, sometimes I have to dig deeper or be patient in order to find the nuggets that can be gold when it comes to further improving an organization and its products or services in the eyes of its customers.

Another consideration to heed is don’t ask these questions as if it’s an interrogation, but rather present the questions and treat the discussion as a means to learn and understand how you can be of further service to your customers. Be comfortable in any silence that might arise during the interviews, as it might take some customers time to think about what they’d truly like to experience. Lastly, don’t let the feedback become overwhelming. When you assess customer responses, look initially for trends and commonalities between responses which suggest that the feedback is important. With these responses prioritized, you can then, with time, dig deeper into customer responses to determine what might be relevant and valuable and what may simply be one customer’s opinion. Above all, treat this information like gold because it is and always will be the very intelligence you need to ensure your product or service stand above your competition. Best of all, and often counterintuitive to what most think, your customers will appreciate you asking.

Empower Customers on Multiple Levels

Obtaining feedback and insight from your customers that drives how you design, deliver, and present your products and services is empowering to them. It ensures that what you provide and how you provide it is done in a way that aligns with their needs. When considering how to empower your customers, you need to think globally as there are three levels of a customer relationship you need to consider. For example, when you are dealing with a customer or even a prospective customer, rarely are you dealing with one person in one department within their organization. In a business-to-business scenario, if you are dealing with a purchasing agent, then you are not only attempting to empower the purchasing agent, but also their boss, their internal customer (often maintenance, projects, operations, or administration), and in some instances the executives who will make final decisions on whether your product or service will satisfy their needs. In a retail environment, on the other hand, you might be attempting to sell a product to a teenager, but it’s likely their father and mother who are the ultimate decision-makers, further influenced by the availability of money in the bank or credit card. My point is this: when empowering your customers, you have to think in terms of levels, each level having different needs and different perceptions. In the following figure, I outline the three key levels of each customer relationship.

Level 1: Primary customer. This is the customer who deals directly with your staff to purchase and use your products or services. This would typically be the person who is actually using the service or taking delivery of and using the product.

Level 2: Intermediate customer. This is the customer who is influenced by and has influence over the frontline customer. Typically, he/she is the one who may not be using the product or service, but is invested in or influenced indirectly by the perceptions of the frontline customer in their experience with the product or service.

Level 3: Tertiary customer. This is the customer who is not directly or indirectly influenced by the product or service, but is influenced by the perceptions, feedback, and activities of the intermediate customer and, in some instances, the frontline customer.

What you’ll notice about these three levels is that although there is a relationship, the further you move downward toward level 3, the less likely the customer will be influenced directly by the product or service. This said, historically the degree to which the product or service influences each customer level may differ, and decision-making power actually escalates as you move through the levels. For example, although the customer at level 3 may not be directly influenced by the product or service, they may make an ultimate decision on whether it is purchased which, in turn, over-rules that of the level 1 customer. Historically, customers at level 3 are known as the decision-makers or influencers.

It’s for this reason that it’s important to recognize there are multiple levels within your customer’s organization, and that to empower your customers means you need to satisfy feedback from all three levels. This is in stark contrast to what most organizations have practiced in the past; where marketing and selling have focused on their customers, they typically focused on the tertiary or the intermediate customer, not so much the frontline customer. This is often known as “influencing the influencers,” and although this strategy has worked historically, during a time when decision-making has been generally top-down with employees having little say, the times they are a-changin’.

I can recall a situation more than two decades ago now, early in my career when I was the supply chain manager for a manufacturing organization. Early one day, the company owner called me and said, “Shawn, we got a problem with our carrier, and the president of one of our largest customers wants resolution. Can you please call her to figure out what is going on?” Obviously concerned, I quickly picked up the phone and called the president of our customer to determine what was wrong. It turned out that one of the drivers of our carrier had arrived and was acting quite belligerent and rude with her shipping department, who had complained. Rather than dismiss the issue, the president had quickly called our company’s president, demanding resolution or, in her words, we can consider her company to “no longer be our customer.”

This was a great example of a progressive president who ensured that her employees were every bit a customer of vendors as she was. Her employees’ complaints or concerns, although indirectly related to our product (the carrier was one that we had contracted with, but was not in fact associated with our company), were every bit as important as hers. This was not only an eye-opening event relative to the influence our carrier (who was not a representative of our company) could have on our customers, but also how our customers were considering feedback from all levels within their own organization when it comes to our mutual business relationship. Recognizing this, our company’s president began ensuring that all sales people spent time during their visits with personnel on the floor, not just in the boardroom. Presentations began to incorporate not only the value our products could bring to our customers directly, but also how we ensured working with our company meant that all employees and customers would benefit from the relationship.

A lesson from unstoppable organizations is that influencing customers may begin at level 3 in order to become known and to hold a relationship with an influencer; however, to build a longstanding customer relationship that can grow and flourish, your organization needs to consider and support all three levels of your customers.

To fully integrate this approach to influencing customers, try this exercise with your team to gain insights on the varying perspectives that exist at each level of your customer, and more importantly, to gauge any gaps in perceptions of what each level means amongst your team:

1. How is your company today penetrating all levels of your customers’ organizations?
2. To what degree do your employees recognize the various levels of influence within your customers’ organizations?
3. What steps can you take to further influence your customers’ perceptions through your employees? Consider marketing, sales, accounting, operations, manufacturing, shipping, and so on.

By recognizing the different levels that exist within your customer base, both existing and potential, in conjunction with clearly understanding what your customers value in your products or services, an organization is well prepared to offer value that seems so needed, necessary, and convincingly obvious from your customers’ standpoint, that they will think you have created and provided your product or service just for them. This is the true formula to customer empowerment, in three separate points:

1. Continually ask your customers what they deem as valuable in your product, service, or organization.
2. Introduce this value in the form of constant improvements and changes to your products, services, or organization on an ever-escalating scale.
3. Share this increasing value with your customers, recognizing their contribution to supporting the development of such.

If empowering your customers is so simple, then why on earth isn’t every organization doing it? There are a multitude of reasons this may be the case, but in my experience there is one reason that stands above all others—the perception of efficiency. That’s right; all of the exercises, discussions, and interactions with customers that I’ve shared earlier come at a cost: time. Can you imagine creating a product and then continually asking customers how you might improve it to satisfy their needs? Sounds like a lot of work, doesn’t it? Well it is, but as we’ve outlined earlier, it’s for good reason. The problem is that all of this work can perceivably come at the cost of efficiency. How can we get good at producing one product as efficiently as possible if we are constantly improving it? How can we become efficient at taking and responding to customer calls if we are having a dialogue with many of them about how we might improve our service? The laws of efficiency in the corporate world suggest that we obtain a segment of information about our product or service, validate the information in a controlled manner, and then roll out a product or service based on that feedback, offering it at as high a price as possible while delivering it as efficiently as possible. In turn, the difference between what it costs for us to produce or deliver our product or service and what we sell it for is our profit; therefore, increasing our efficiency helps to reduce our costs and increase profits.

This is an important point, so for the sake of our further discussions I’m going to say it again. Pressures to increase efficiency and thereby increase profits come at the price of reducing the perceived value of our product and service that, in turn, reduces demand and revenue.

My point with this statement is not to suggest efficiency is a bad thing, but to suggest that in many instances our constant need to seek out further efficiencies can come at a price. More importantly, although efficiencies in our processes in how we produce or deliver a product or service may not directly influence our customer or their perceptions, there is a fine line that we need to be aware of.

Hurting Your Customer Relationships by De-Personalizing Them

If we operate from the premise that creating a perception of value for customers necessitates creating a perception of personalization to some degree for each customer, then it goes without saying that when our desire to increase efficiency crosses the line of influencing a customer’s perception of personalization, we detract from perceptions of value. Put another way, counter to providing an experience in which customers have the perception that what they are receiving is of value, and to a degree to which they simply can’t find anywhere else, customers in turn have an experience that suggests moving their business anywhere else would be a good idea. I call this de-personalization, and there are examples of it everywhere. Here are just a few and, for the sake of our discussion, I’d like you to consider the first thought that pops into your head when you reflect on these situations:

You place a call to a customer service desk for assistance only to be placed on hold for more than five minutes while listening to a message that says, “Our wait times are longer than expected, please be patient.”

You drop by the DMV to update your license sticker, only to find a long lineup and a lack of sympathy when you reach the teller.

You stop by a bank late in the afternoon to complete a transaction that you aren’t able to complete online, only to find they closed 15 minutes ago.

You buy some product that is meant to make your life easier (think of appliances, tools), only to find it breaks after a handful of uses.

You opt to pay extra for undercoating and wax sealant on your new car, only to later realize that the undercarriage is still rusting and the paint sheen (that was to last the life of your car) is now gone.

In every one of these situations, an organization, or more specifically the leadership within it, made a decision to produce or deliver a product or service in the most efficient manner at the cost of detracting from the customer’s perception of value.

Why can’t they hire more call center agents to take calls faster and reduce wait times?

Why don’t they hire someone else at the DMV who seems to actually care about their customer’s time?

Why couldn’t the bank stay open later, just like every other organization?

Why did the packaging for the tool or appliance look so appealing, only to find literal junk inside?

Why didn’t the dealership offer a reseal or recoat to your car in order to sustain their promise of longevity?

The answer of course is that each of these changes would cost money. What unstoppable organizations realize, however, is that being efficient can come at a hefty price when it influences a customer’s perception of value, and that price is the loss of a customer’s business. When we invest time in understanding, assessing, and adding value to our customers, we position ourselves, our organizations, and our people at a unique competitive advantage, which allows us to charge more, gain more referrals, keep our customers longer, and have more repeat business. All of these influence the bottom line more than efficiency ever could.

I recall one such instance in which I was attempting to return an Internet modem, having had problems with connectivity for days. Upon making several troubleshooting calls to the Internet provider, I was advised to take the modem to a nearby retail store to exchange it, at no charge. As I required Internet connectivity the next morning in order to deliver an online presentation, I raced to my local retailer to make the exchange, nervous that it may not completely resolve the issue and conscious of the fact that as we approached 5 p.m. I may be running out of options.

Upon arriving at the store, I asked the young woman working in customer service if they exchanged modems, and she replied yes. After quickly explaining my problem, I slapped down the supposedly defective modem and asked for a new one. After a curious look, the attendant looked up at me and said, “Sir, I can’t exchange this.” Almost immediately furious, I asked why. She responded, “You’ve brought me a phone modem, not an Internet modem.” Realizing that, in my haste to make it to the store before closing, I accidentally grabbed the wrong modem, I pleaded for the exchange, even offering to provide my credit card to purchase the new modem. However, the young woman refused. “Our store policy states we can only exchange like for like. Now if you’ll excuse me, I need to tend to the next customer,” she said. Angry, I asked to speak to her supervisor, who was unavailable. After a few tense moments and recognizing that the closer we came to 5 p.m., closing time for the retailer, the fewer my chances of actually resolving the issue before morning, I left. I returned to my car where I called the Internet provider, asking them to step in and resolve the issue. After placing me on hold for several minutes and presumably speaking with their supervisor, she returned to confirm that they could not provide me with any assistance.

I share this story for a couple of reasons. First, I’m still fuming at how a situation that was seemingly simple to resolve, wasn’t. If I came into a store you owned and made this same mistake, offering my credit card to pay for the modem outright, would you not take me up on my offer? Second, even escalating the situation had no influence on the outcome, which suggests that there was a lack of knowledge at virtually all levels of the organization as to what customers valued (their time, ease of accessibility to their services). My needs and, specifically, the very things that I valued as a customer were completely and utterly invisible to the eyes of these employees on account of their need (presumably as a result of management objectives and training) to be efficient and follow process, rather than service their customers.

This example demonstrates something that unstoppable organizations are aware of and, more importantly, practice almost religiously. The CEOs, executives, and employees of unstoppable organizations don’t just talk, they walk their talk by putting customers first, empowering them to obtain value in the products, services, and experiences they have. If you understand how important this statement is, it will then identify how employees should not be rewarded for being efficient if achieving such detracts from the value customers receive. Unstoppable organizations place value over efficiency. I mentioned earlier the story of Zappos, initially launched as an online shoe retailer. The model of the company then and still today is that employees are encouraged to do “whatever it takes” to guarantee customers are satisfied. Company policies such as no time duration for returns and unlimited budgets for employees to make sure customers are satisfied (there are even stories of some employees actually sending flowers to customers for no apparent reason) ensure that customer value precedes efficiency.⁴ The Ritz Carlton is another example of this approach at play, guaranteeing that all employees have a budget of up to $2,000 that they can spend, no questions asked, if it means the difference in satisfying the hotel patrons.⁵