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You can’t manage from the board room or the balance sheet alone

I like watching Under Cover Boss because apart from it being interesting on many levels, it never fails to highlight how businesses cannot be run solely from either the balance sheet alone or from the ivory towers of a head office, despite claims of the best management reporting and a transparent, open and communicative culture.

I recently watched an episode which featured a company called Pet’s Corner who I’d Pets_Corneractually not heard of before. However, it transpires that they’re a pet shop chain with 89 stores currently, mostly across Southern England and the Midlands. They’ve grown mostly by acquiring smaller pet shops and then rebranding them to look and feel like the Pets Corner corporate brand.

Overall the business is looking to expand significantly by opening a new store every month, albeit having been in the red for the last 2 years. As a way of trying to return the business into the black, they decided to significantly cut staff costs based purely on the balance sheet numbers alone in addition to the fact that sales figures overall were down with no signs of growth. Hence the reason for going undercover.

The board wanted to know that when they scaled, they weren’t just going to scale up their current problems into their news stores increasing their financial issues. They wanted to understand and fix any current issues first to ensure that they had the best chance of scaling successfully. Within the first day of the Product Development Manager, Steve Charma going undercover, it was quite clear what was wrong. In the first store that he visited, the impact of the staff cuts were clear. There was one Shelves-emptystaff member alone responsible for a thousand foot plus store. That one staff member, stocked shelves, served customers, unpacked deliveries and answered queries but more interestingly, had to shut the shop to go to the toilet and at lunch time. The result was missed sales opportunities and customers left to wait longer than desired. In addition, the manager’s position had been vacant for 3-4 months and the shop signage was failing to draw footfall from the Tesco store next door.

None of the impact of these issues could have, or would have been determined from the view from head office alone or from management reporting. Further stores visited highlighted stockroom and stock storage issues, damaged products, empty shelves and further lost sales opportunities, none of which were visible from head office and despite the fact that the company spent £100,000 per year on mystery shopping.

One store however, was bucking the trend. The in store team had taken the initiative and had been running a Pets day where customers could bring in their exotic pets and discover other rare animals and exotic breads. Steve Charma was initially not happy due to the fact that head office didn’t know this was going on and they hadn’t been consulted. He was more concerned about brand standards and health and safety issues.

Exotic lizard However, when sales at the half way point in the day were 10% up on the store average, his view quickly changed. A lack of management and leadership, shortfalls in sales training, staffing levels and product storage issues were the barriers to scaling. Ironically all of which had been initiated by head office without consultation, consideration or even observation with the ‘troops on the ground’.

Despite that, they staff were mostly doing a great job, delivering good customer service and in some instances, taking the initiative to increase sales and the customer experience. Overall quite an eye opening experience for the board who at the end of the programme, committed to significant changes. However for me there was a key takeaway which in hindsight is so obvious, but still so frequently overlooked.

MBWA as management guru Tom Peters called it. Management by walking around. You can plan all you like in the board room but without consulting staff and understanding the impact on customers, the best intended plans will fall short. You can cut costs on the balance sheet, but without consulting staff and considering the impact on customers, isolated decisions made on paper without intelligence from the ground, can and will  have the opposite effect to what’s intended. Such is the value in engaging both staff and customers regularly on future decisions and plans, in addition to key decision makers getting out and about regularly to see where the real business operates, which isn’t in the boardroom or on the balance sheet.

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UK economy grows, customer satisfaction declines

With signs that the UK economy is now starting to recover after the worst slump since World War 2, customer satisfaction however is on the decline.

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July saw the most recent update of the UK Customer Satisfaction Index, which showed the third consecutive drop in customer satisfaction recorded over the last 18 months.

12 of the 13 industry sectors declined with the Retail (non food) sector remaining top of the league whilst the Utilities sector continues to flounder at the bottom of the list despite a small increase in satisfaction over the last six months.

Of the 197 organisations featured, only 28 increased their satisfaction scores, with a massive 96 seeing their scores decline.

The usual suspects remain at the top of the table namely John Lewis, Amazon and First Direct being consistent over the last 12 months. The only noticeable absence is Waitrose, who have dropped to 6th place, down from 3rd in 2013.

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Within the top fifty organisations, Centre Parcs has shown the biggest improvement rising to 13th place, up from 89th in 2013 with Welsh Water showing the largest improvement out of all the organisations.

So what’s going on then?

Well as we’ve seen since the UKCSI started in January 2008, customer expectation has continued to rise and organisations certainly over the last 18 months have failed to keep pace. In addition to that, customer needs and preferences are evolving. The use of mobile technology is a good example and generally speaking, organisations have been slow to responded to the changing landscape of the customer and digital experience.

The trust issue, or the lack of, has remained front and centre with customers and the continued exposure of poor practice and treatment of customers in addition to some high profile cases of deliberate malpractice has done nothing but undermine customer confidence. There is a very marked and direct correlation between customer  TrustWordCloudsatisfaction and trust, and the trust will need to be rebuilt in order for the direction of the index to reverse.

Finally both public and private sector cost cutting and stalled investment is likely to have had an adverse impact on customer satisfaction, which when combined with the other variables above is painting a less than positive picture of the state of customer satisfaction in the UK.

However, within this environment, there are also opportunities for organisations that can be lean, agile, and innovative with both products and services and who can deliver consistent, simple and effortless customer experiences. In fact now, more than ever in recent years, is a good opportunity to steal a march on the competition for those bold enough to lead the way.

Organisations are going to need to redouble their efforts over the next 12 months and beyond if they’re going to want to see results improve as further decline will start to adversely impact the bottom line.

For further details, visit UKCSI

 

 

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Brevado – “Creating Products Synonymous with Better Customer Experience”

Like all great products or services, they solve a fundamental problem that meets a customer need, making lives simpler and easier in the process and in doing so creating better customer experiences. The Brevado team has done just that.

Brevado is a relatively new and small tech start-up company born in the New York area in the Eastern United States. It was the brain child of three long-time friends, Nick Zafiropoulos, Steve Garofalo and Mike Perna. Prior to joining forces in business, Nick loved ‘fixing computers’ with his own IT services company, and Steve and Mike worked for a web design company. By their own admission, none were really aware of customer experience practice and design until they had an epiphany moment.

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Steve and Mike’s employer was all about the numbers and volume, an approach that didn’t really sit comfortably with either of them. The focus was on looking for and converting qualified leads into customers, ‘shovelling’ new clients in at the front end. Churning out websites with little focus on the customer experience and communication which resulted in a lot of customer confusion.

Conversely, Nick didn’t have the budget to go out looking for new business in volume. He focused heavily on delivering a great customer service to his existing clients; Nick provided on time delivery and sharing project milestones regularly. He would come to find later that sharing progress was a key component to his clients’ satisfaction. In this way, Nick successfully got his existing clients to refer him to others. New clients started actively seeking him out from the positive word of mouth he was getting. His clients loved his approach and more than anything, being kept in the loop on projects was a refreshing way to do business for them.

The 3 friends shared a life-business conversation, as they did from time to time, realizing that the web design company model created problems. Customers weren’t being kept updated and as a result of the poor experience, customers weren’t referring or even returning for repeat business. This compounded the conveyor belt approach where more and more customers were needed at the front end to compensate for losing customers after just one sale.  screenshot brevado timeline

The guys quickly identified that this was a problem that needed a solution and one that would work for creative professionals (like web designers), small businesses and freelancers. It needed to be simple for people who didn’t have huge time to invest, and work in a way that would complement existing work flows so as to not overly disrupt how people currently operated.

The first idea was to create a customer portal for businesses to collaborate and share progress, but this didn’t completely solve the problem yet. It was with the addition of the timeline that they knew they were on to something. This ‘thing’ was the future way for creative professionals to share progress with their customers and create a better customer experience. They were so convinced that they quit their jobs to work on development full time.

Their lean approach had them reaching out to all creative professionals they had ever met, even those they had not known before. Early feedback was positive along with a stream of new ideas and functions that people felt they would like to see. From this, a prototype was born. The prototype enabled the team to get accepted into a growth accelerator program in North Carolina for both funding and business mentoring. Within 3 short weeks, the guys packed their belongings and headed south.

During this time, they released their public beta version for testing where anyone in the world could sign up. A well timed simultaneous press release was picked up by a series of blogs and over the course of a weekend, 700 people came on board. This further confirmed that they were onto something good and that this was addressing a significant problem that people had.

Moreover, people had stopped requesting new features and were now requesting refinements to existing elements which pointed to the fact that the beta feature set was on track. In fact users were already starting to switch from a competitor product which they used for collaboration on their own projects. Brevado’s competitors are good for internal team use, but overly complex and opaque when using with external clients; this was the problem the guys had originally identified and set out to solve. Customers wanted transparency and shared progress on projects, whether they would last one month or a year and this is what Mike, Steve and Nick had built. Brevado was born.

For anyone who’s ever managed a project, whether for internal or external customers, you know how important it is to keep customers updated and engaged to ensure the project actually gets completed. You also know there are always tasks for the clients which often don’t get completed on time despite the best intentions.

As part of the project management functionality, Brevado allows you to assign tasks directly to clients and automatically suggests updated timescales if they miss a deadline. You can also assign team members in order to collaborate on multiple timelines. Customers can see what you’re currently working on, when it’s due to be complete and what’s coming up afterwards. With a future Google integration, you will also be able to sync deadline dates with Google Calendar with a link to Google Drive documents.

Brevado customers range from artists and video producers to legal and consultant service providers who all have a need to share their iterative work and progress with clients. Curiously, Brevado has had more impact from outside the U.S with interest in the UK, Spain, Jordan, Italy, South and Central America, Columbia, Brazil, Australia and Canada. One Brevado client based in Denmark has customers in the U.S and so use of the tool gets around awkward scheduling conflicts with different time zones. This adds value for both the client and the end customer.

Brevado seeks continuous feedback from clients on their experience and usage and the theme they continue to hear is not only do clients really like it but their clients like it as well, so everyone wins. In addition to progress and updates, it also creates an inclusive client experience that adds to higher levels of engagement and advocacy through usage. Simply logging in and checking progress has solved the panic of ‘oh my god, where’s my project up to?’

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When Mike, Steve and Nick set out on their journey, they didn’t realize the importance of the customer experience in business. It was mostly about the bottom line. Once they discovered the problem and did some research they discovered that customer experience is the most important aspect of business and this is what Brevado is focussed on.

This article was originally written for The Customer Experience Magazine, July 2014.

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Yorkshire Grand Depart 2014

The two opening stages of the 2014 Tour de France based in Yorkshire got the race off to a superb start and has set a new standard for support of the event itself, for cycling both in the UK and more importantly in Yorkshire. IMG_0733

The race Director, Christian Prudhomme, described the Grand Depart as the ”grandest” in the race’s 111 year history.

An estimated 2.5 million people lined the route and it was quite clear, from both the scenes on the television, and from being there in person that Yorkshire got enthusiastically and passionately behind the event.

We opted to get onto the climb of the Cote de Holme Moss where the riders would be at their slowest and we weren’t disappointed in the slightest.

The weather held, the 60,000 strong crowd were in great mood as were the Police and race officials.

We opted to cycle there given the road closures and riding the traffic free roads of Huddersfield and Holmfirth towards Holme Moss was a novelty in itself. The crowds were out early and by the time we got to the climb itself, we realised that we certainly weren’t the first.  IMG_0743

Undaunted by the building masses, we cycled the climb itself up to the King of The Mountains finish at the top for a few photos and then picked a spot to watch the day unfold until the race arrived.

Given the vantage point we had we soon spotted the TV helicopters that were following the race and we watched them weave around as the peloton approached. The two man brake came first which included Thomas Voeckler closely follow by the main bunch with Team Sky at the front. The crowd noise for deafening but it was a great spectacle. And then they were gone. There were two riders that had fell off the back that nearly got caught up as the crowds started to descend the climb but they soon parted to let them through.

There were so many people up there that we had to walk the mile and a half off Holme Moss with our bikes before the crowed thinned enough to get cycling again.

A fantastic day, great experience and hopefully something that will deliver a legacy for Yorkshire and for UK Cycling.

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