7

CREATING A CULTURE THAT ADDS VALUE TO YOUR CUSTOMERS

But change must always be balanced with some degree of consistency.

Ron D. Burton, President, Rotary International

When it comes to attracting and retaining customers in today’s increasingly online world, the CEOs, executives, and leaders who oversee unstoppable organizations are keenly aware that in order to grow and succeed (much less sustain their presence), they need to find, attract, and retain the right people. How, for example, can an organization with a longstanding presence in the marketplace, a strong brand presence, and quality products or services create consistently high value interactions with and for its customers if the very employees who are identifying and delivering this value aren’t motivated to provide such or, worse yet, leaving the organization? Successfully satisfying the needs of today’s customers can’t be reasonably achieved if high turnover or low engagement of employees exists. If you haven’t yet experienced this conundrum in your organization, you are either doing the right things or are lucky and luck has a time limit.

As we discussed in the previous chapters, today’s younger generation in the workforce have different ideas about what their careers will be like, which influences their perceptions around loyalty to their employer. As I mentioned earlier, I don’t make these statements to add to the cliché or biases around younger generations, but to point out changes in the perceptions of today’s employees. A recent study conducted by Gallup¹ supports this fact and brings to life what many of the CEOs I interviewed already know to be true: the Millennial generation is a “job-hopping generation.” Most notably, the study identifies that:

• Millennials are the most likely generation to leave their job.
• Six in 10 Millennials are open to the idea of a new job opportunity.
• Millennials are generally the least engaged generation in the workplace.

To put these statistics into perspective, the study found that 21 percent of Millennials have changed jobs in the last year, more than three times the number of non-Millennials that reported the same. In addition, only half of Millennials strongly agree that they plan to be working for their organization for the next year, which suggests that 50 percent are planning to leave within 12 months.

Now before you head down the halls screaming, let’s put these statistics into perspective rather than take an extremist point of view (recall my earlier point about avoiding the tendency to create generalized statements from facts). Let me pose a few simple questions for you to reflect upon, based on your organization and its current state in regards to the mix of generations:

1. What is the current demographic of your workforce? Consider the percentage of young versus older workers.
2. What type of role does the predominance of each generation work in? Do you have a mixture of young and older employees in each department, or are there areas in which there is a predominance of one generation or the other?
3. What are your current turnover statistics for the past 12 months? How many people have left, for what reasons, and how old were they?
4. What have you done as a result of feedback from those who have departed? Have you made any changes and, if so, have you communicated those changes to existing and potential employees?
5. What are your estimations for attrition in the coming 24 months? How many people are likely to retire (or leave for other reasons) and what are your plans for replacement (new hires versus existing employees)?

These questions are meant to provide two things. First, they will shed some light on the degree of risk that may exist within your organization relative to the impacts of employees departing. Second, and more importantly, they will shed light into what areas you need to address to build some plans for ensuring your organization will survive and thrive into the coming years based on the existing demographic of your employees. If, for example, you need new employees on account of attrition or customer growth, then these questions will give insight on what you need to incorporate into your workforce to ensure your organization continues providing value to its customers. Alternatively, if the levels of your staff are stable and there are no dramatic or foreseen changes (for example, those departing the organization) in the coming years, then the questions will shed light on the types of plans necessary in the coming years. What is important to realize from this exercise as well is that regardless of the current demographics within your organization, Millennials and Generation Z are soon to be the predominant generations amongst your employees. As a result, now is the time to consider what changes or improvements are necessary to appeal to these younger generations, but also to capitalize on the benefits they can bring to the organization as discussed earlier. You’ll notice again I’m challenging you to think forward, a common theme amongst unstoppable organizations.

Virtually every one of the CEOs and executives that I’ve met and worked with, interviewed, and consulted prior to writing this book have confirmed that identifying new ways to support and engage with the workforce of tomorrow is top of their agenda when it comes to considering how to grow the organization and its revenue. Fortunately, many have found and introduced solutions that have supported lower turnover, higher interest in joining the organization from would-be employees, and higher, positive engagement from their existing employees, the combined results of which have led to stronger sales, more revenue, and increasing market share. Let’s take a minute then to explore some of the ideas and changes that these unstoppable organizations have made, and the benefits they’ve achieved as a result.

Is it Too Little Too Late?

Mike Vokes, the President of Vokes Furniture, was faced with a challenge several years ago. As the demand for his custom crafted bedroom furniture grew, so did the number of employees he needed. This was despite the continued focus Mike placed on implementing lean practices to reduce waste and increasing automation to support higher productivity. As the number of employees grew, Mike had hired a plant manager to oversee daily operations. After just more than a year, it became clear that the plant manager was not working out for a variety of reasons. Mike realized that to engage with his employees on the level he knew was both necessary and possible (based on his early days working side by side with his people), he had to empower some of his senior team members to oversea plant operations, allowing them to oversee and lead their people, with Mike getting involved only when issues, ideas, or challenges became significant. This allowed Mike to remain engaged with his team, but giving the responsibility of managing each work area to someone familiar with it, and who had already gained respect from and built a strong relationship with the team. Since introducing these changes, the increased morale of Mike’s employees, and most notably the continued dramatic growth of the organization (having near doubled in size), has proved the value of moving decision-making down to those engaged in the work.

In summary, what we can derive from Mike’s lessons is that it’s never too late to transition the organization toward a more empowered workforce, shifting decision-making to employees who in turn provide higher levels of employee engagement, which results in reduced turnover and increased productivity.

If Mike can make these changes amidst a business that has operated for nearly two decades in an industry that is known for high levels of competition and tight margins, then any organization can do the same. To consider your organization and its culture or operating practices as being set in stone or engrained into people to the extent that a change would fail is simply an excuse for avoiding making necessary changes that embrace the very benefits that younger generations bring with them. With this lesson in mind, logically the next obstacle is to determine where and how to begin. In fact, this is where I find many organizations stuck, committed to the change but unable to determine the best place to begin. To this I respond with an age old question: “How do you eat an elephant?” The answer, of course, is you eat an elephant one bite at a time.

Building a Culture of Employees Who Add Value to Your Customers

To create an environment and culture that appeals to your existing employees as well as younger generations requires a different way of thinking. As we learned through Mike’s example, he has placed a continual focus on designing and deploying an effective model for leadership and mentorship, in combination with employing a tool such as the lean system that supports building a culture of continuous improvement. This is topped off by a consistent search for equipment and automation that further improves speed, quality, and consistency of products. Clearly, this is more than just about focusing on your people; however, you’ll notice that what underlies all of these areas are people. Mike couldn’t, for example, introduce a new saw if his employees weren’t willing to embrace the new technology and adopt revisions to their existing processes. Employees underlie everything within an organization, and it’s for that reason employees must be the priority.

It is no small feat, however, to consistently find new ways to tap into the creativity, ideas, and energy of today’s younger generation while convincing them to embrace the experience of older generations and, in turn, converting all of this collaborative experience and knowledge into value for the customer that will support stronger revenue. The starting point then is considering your people as primary to success, and so ensuring that the teams throughout your organization are formed and trained in a way that capitalizes on their individual differences. This recognition results in what I call the golden rule to hiring; that is, team fit is more critical than individual skills when it comes to building an effective team, and more importantly, an effective organization.

As we’ve discussed previously, because the way that you add value to your customers is through your employees, then creating an environment in which employees are able and willing to add value is crucial. In earlier chapters we discussed the complexity of people, which extends to more than just generational considerations. The challenge then, as well as the opportunity, is creating an environment where employees understand, individually, the value that they bring to the organization and its customers and, in turn, how that value addresses your customers’ needs. I’ve demonstrated this in the following figure:

Let’s first consider this diagram from the standpoint of a customer, and second from that of our employees.

Building an environment to attract employees means creating an organization that is clear about how they best add value to customers, both individually and collectively. With this clarity, supported by open communication through constant dialogue that flows from bottom up (from employees to leadership) as well as top down (from leadership to employees), the customer value chain (CVC for short) becomes a continuous process that ensures customers are always at the forefront of every employee’s decisions and actions. There are different means to achieve a CVC, the most effective being combining several if not all of the following methods, including:

1. Clear definitions of how each role contributes first to customers and second to the organization, introduced and reviewed during hiring and employee review meetings.
2. Frequent meetings, both formal and informal, held between top leadership and employees, both individually and as a group to discuss evolving customer value and how the employee and their leader can meet these needs.
3. Cross-training practices that expose customer-facing employees (such as sales) to customer support roles (such as shipping) and vice versa, increasing awareness of the importance of the team in satisfying and adding value to customers.
4. Providing increased authority to employees to satisfy customer needs, ensuring leaders practice a “hands-off” approach to engaging with their people.
5. Using employee suggestion programs continuously, that are in turn supported and acted upon by organizational leaders.
6. Employee advisory panels that discuss and share ideas on current company challenges, presenting ideas and options to senior leaders for decision-making purposes.

Tony Solecki of Caframo, for example, sets aside time each week to meet one-on-one with his employees to discuss the current state of the organization, its customers, and the market, as well as requesting feedback from employees on they can be more effective in their roles. We’ve also discussed Jeff Sziklai at Bellwyck Packaging Ltd., who began the practice of quarterly reviews with all employees in which he would walk out onto the production floor and speak to them about the state of the business, including new opportunities and customer feedback. Jeff would then solicit ideas from employees to support the continued success of the business. The key in connecting employees to the value they can and do contribute to customers is communicating through dialogue. The options for doing this are endless, and as Mike from Vokes Furniture suggested earlier, there is no better time to start than now.

There are additional benefits to helping employees connect with the value they provide. These types of engagements allow for both employees and leaders to share their ideas, challenges, and opportunities based on their own experiences with customers. If a long-standing customer has been lost, senior management can share the feedback they received on why this happened. Alternatively, if employees have had feedback from a customer on something that needs to change, they can share this with management. The key to delivering value to the customer is to recognize that the ability to do so hinges on everyone’s understanding of what customers are seeking, and how they as individuals can respond.

I mentioned the unstoppable success of Jeff and his team at Bellwyck Packaging. Their continued effort at satisfying a niche need for their customers was never an easy battle. Several years ago, a dominant competitor was trying to take a large customer account from Bellwyck by undercutting them on price. Always open with his team, Jeff shared details about the threat with his employees. He reassured everyone that the reason for the company’s unstoppable success was that they were able to consistently turn around jobs within only a few days. Jeff emphasized that continuing to do this, while ensuring consistency and quality of their products, was the only way to keep this customer happy. As the CEO, Jeff knew that having every single employee focused on fast order turn-around was the only way to please this customer and thus sustain their business. In addition, Jeff asked his employees for ideas about what else could be done, and encouraged them to continue sharing ideas with him, the plant manager, or their supervisor if they came up with anything. Jeff’s talks were very much a collaborative discussion that were both top-down and bottom-up, helping connect employees with the value that customers were seeking both strategically and tactically.

It’s not only important, however, to ensure that every employee understands the specific value they offer through their role; they must also learn new ways of adding value. When I worked for Magna International, some 20-plus years ago now (gulp!), I worked as a logistics coordinator. I helped to organize and arrange for pickup of more than 160 outbound loads each day, working in a team of five other coordinators. After working in the role for about eight months, my boss Jim pulled me aside. “Shawn,” he said, “you’ve got a great way of dealing with our customers when they have complaints or concerns. You track information well, make commitments that you keep, and always are able to determine the root cause so that solutions can be found to avoid the problem happening again. How would you like to take on the role of handling and overseeing all customer complaints?”

I was ecstatic about the chance for further responsibility so early in my career with Magna, and I’ve never forgotten that discussion with Jim. He always ensured that he connected my skills and accomplishments with supporting our customers, and where possible took full advantage of an individual’s unique talents in order to help the organization, and more importantly, its customers. I should mention as well that the conversations Jim had with his team, similar to the one he had with me, weren’t discussions that happened during an annual review, but rather were fluid. They could happen at any time if Jim received feedback or observed something good or bad. Jim was a master at helping his employees connect with how they benefited the customer, and he took full advantage of the individual skills and abilities of his people to further add value to his customers.

There are numerous ways that leaders can make these individual value connections with their employees, including:

1. Providing one-on-one feedback directly to employees on a frequent basis, sharing both positive and constructive feedback relative to the employee’s role and actions on meeting customer needs. These do not have to be informal coaching sessions, but instead are a set agenda to ensure employees and supervisors stay focused on how the employee can add value.
2. Team discussions facilitated by a leader in which team members provide feedback on the influence others have on their work and, in turn, their collective value to customers. The basis of this dialogue, different from the previous example, is more focused on guided self-discovery on the influence employees have on customers, both directly and indirectly, with the leader simply facilitating the discussion rather than directly participating. By placing a group of employees together in a facilitated discussion to share insights and ideas about adding value to customers, the results can often be higher levels of receptivity by employees as compared to receiving feedback from a direct supervisor or manager, which can sometimes fall on deaf ears or result in paranoia about job performance and stability.
3. Peer reviews amongst employees where internal employees provide feedback to their peers, sharing how their role and performance influenced them (as an internal customer for example) and openly discussing ideas about how to collectively improve value amongst one another to influence the end customer. This approach is more effective over the second example when teams are too large (for example, beyond 15 people) or too small (teams of two to three people) to hold a collective discussion. It is also effective when considering how to ensure dialogues are more meaningful. In a group setting, there is always a percentage of employees who will choose to remain relatively silent, requiring a highly skilled and trained facilitator.

For a printable version of these approaches in order to organize customer value chain discussions with your employees, make sure to visit www.unstoppableorganization.com.

Incorporating these types of dialogues into a leader’s agenda, selecting one, or using all three in some fashion will ensure that employees consistently connect their roles and actions to satisfying individual and collective customer needs. In turn, this will add value to the customer’s relationship with the organization, its products, or services. These can be effective tools when building and increasing awareness amongst existing employees. The question remains, however, if team fit is critical to building a customer-focused team, how do we achieve this when bringing on new hires?

Attracting and Hiring Employees Who Add Value

With a culture of employees highly focused on adding value, it might seem that all is well and good. Regardless of how unstoppable your organization is, the reality is employees will still come and go for a variety of reasons. From attrition to moving away, employee life changes will continue to influence their willingness and ability to stay at your place of employment. It’s for this reason that how you attract and hire employees, ensuring you are careful about selection and integration, becomes critically important. Of course, the hiring practices of each organization can be different, depending on the sector in which you work, as well as policies and even legal requirements that may influence how and who you hire. For example, doctors, lawyers, and even those who work in trades have to meet specific educational and legal requirements to be hired for a job, to an extent that even the CEO or senior executive team has little or zero influence. For unstoppable organizations, however, it’s not the criteria within which you hire employees, but the process you follow to ensure the employee you select is the right fit for your organization, the team they will be working with, and the customers they will interact with. Let’s look at an example.

I worked with a client just over a year ago who led a marketing team. Hiring was a process that my client managed directly, although human resources provided some input. In essence, my client could hire who and how they wanted, as long as the hire possessed the basic skills and criteria for the role, typically set forth by HR, were met. Previously, my client had hired employees as most do, by reviewing and screening resumes, followed by one or two face-to-face meetings, resulting in selecting a candidate. My client found that integration and adoption of the “value first” mindset took time, with team members often not convinced that the candidate would be successful in the role, hence not investing much time or support in the early stages of probation to help the new employee succeed.

The issue, from my experience, was buy-in. Because employees on the team were not a part of the interview or hiring process, they remained cold to the person and at arm’s length until they got to know the new employee personally, and became comfortable working with this person. This could take weeks or even months, particularly if the new employee was quiet or shy. We revised the hiring process to incorporate team involvement. The process for hiring looked like this:

Step 1: The job ad was reviewed by existing team members and relevant feedback (such as fit within the ad guidelines, etc.) was incorporated.

Step 2: The hiring department and my client, the vice president, screened new candidate’s resumes. The dominant discussion points were on candidate experience and fit, tied back to how the new employee may assist the team in sustaining if not increasing the value added to existing and potential new customers or clients.

Step 3: A few candidates were interviewed. Two employees from the hiring team were involved (which the team self-selected or were drawn from a hat) and asked questions that the team was interested in, building on the already developed questions of the vice president and the hiring supervisor.

Step 4: Notes taken during the interview were first reviewed amongst the team of four, then summarized and taken back to the broader team for input and discussion, collectively agreeing on either a further short list of candidates for interview or to select a potential hire.

Step 5: The short list of candidates or the potential new hire were then invited in to meet with team members in their working environment, spending five to 15 minutes with at least four employees (different than those from the interview). Those employees the candidates met with were in roles that included a combination of people who were:

• In the same role as that of the potential new hire.
• In an internal customer role that the potential hire would be supporting and working with.
• In a role outside the hiring department, but were known to give open and honest feedback.

Step 6: Those who met with the candidates discussed their perceptions of the candidates, shared notes, thoughts, and ideas, with the goal of making a recommendation for hire to the vice president.

Step 7: A recommendation for hire was made and the selected candidate was contacted with the offer.

What were the benefits of this approach, you might wonder? Well, we definitely met our goal of ensuring new employees were embraced by the team faster. This approach guaranteed that employees who were already on the team bought into, and in turn had some responsibility for, the person hired to ensure their success. In addition, my client found the hiring process itself brought the team closer together, helping them to learn new ways to collaborate and share openly their ideas and feedback. Moreover, the process increased the tenure of new hires and reduced turnover, validating that those who were hired were more likely to not only be understood by their coworkers, but have a better feel for the role and their coworkers as well, making it more likely they would stick around.

Lastly, we identified our approach to hiring when creating job ads and letting others know the organization was hiring, making sure that potential candidates knew they would be meeting team members during their initial interview and have a chance (if placed on the short-list) of seeing their work area and meeting the rest of the team. Word got around about the approach, which meant more employees from other departments began to apply for internal positions, and externally there was an increase in the number of applicants.

The lesson is that unstoppable organizations increase their chances for success in hiring by involving their teams. In doing so, they make a closer and faster connection between new job candidates and that of their team members and internal and external customers, bridging the “value” gap on an individual and group level before candidates ever get hired.

Dealing With Employee Pushback and Inconsistency

Hiring using the approach just described ensures you select the right candidates, and can lead to an increase in the volume of applicants if word gets out. It’s important to mention that shifting to such an environment with existing employees, where employees connect what they do with how they influence the value customers receive, isn’t easy. There will always be those uncomfortable with the change for whatever reason, and it’s important to recognize that some plans must be put into place to ensure a consistently high value interaction for your customers as you evolve through these changes. The last thing you want is an employee who isn’t (at least initially) buying into your approach and, in turn, takes out their frustrations or doubts on your customers.

Moreover, until you have fully implemented and proven the processes just described, you may continue to experience employee turnover before the full impact of a value-based culture exists. In this instance, there are a few introductory measures that you need to take to stay on course.

First, make sure employees cross-train both inside their existing department as well as with other outside departments that influence their role. By doing so internal to the department, you guarantee a natural evolution of sharing best practices, in which employees either more senior or more skilled in specific areas share their processes and methods, and a natural collaboration occurs. Doing so externally increases the employees’ awareness of how other departments and individuals function, once again ensuring a process of internal best practices where employees identify new means of performing in their roles that in turn can make other roles more productive or efficient.

One client who manufactured home products said there was a battle happening consistently between their customer service department and sales department, to the extent that customer service employees were leaving the business, frustrated at the lack of support. We instituted cross training that helped broaden the perspectives of both sales and customer service on the idiosyncrasies of each of their roles, as well as ensured they shared differing perspectives from their interactions with customers. This only helped to increase the customer value awareness of both the departments as well as the individuals within each group.

Second, capture key processes in a simple form. In essence, draft procedures and best practice cheat sheets, but make sure the documents are created and managed by the employees who use them, not an external department or someone who is at arm’s length from the work. Keep the practice simple to ensure documents remain up-to-date, and assign the responsibility of oversight to someone in each team or department who is respected by others, but also detailed enough to guarantee the documents contain the necessary information. As with previous examples, let the team define and select this person themselves.

In working with a large automotive company, I was helping a department reduce their rework. Repetitive problems were occurring amongst generally the same team members, thereby creating a perception of either a lack of ability or a lack of caring. In the early stages of the project, when meeting with employees, I was asking about work procedures and interactions amongst team members, as this is the foundation of ensuring consistency and the adoption of internal best practices. Time and again, team members either weren’t aware of procedures or mentioned that they didn’t use the procedures as they were too difficult to understand. Making matters worse, this organization was forced to use procedures as a way to satisfy their customers, and were in turn signing off on each order that procedures were being followed. Step one, then, was to review procedures with employees who were actually doing the work, revising and updating the documents, and making sure they were written in clear English, rather than drafted to satisfy an auditor who had never worked a day in that job.

Lastly, and most importantly, open dialogue amongst employees is key to ensuring consistency. As I wrote in my first book Operational Empowerment, there is nothing more effective at building communication amongst a team as holding a brief morning meeting with team members, whether they are in an office environment, out on the worksite, or in the middle of a production floor. Open dialogue on a regular basis ensures that supervisors, managers, and team leaders can communicate with employees about customer feedback (internally or externally). If structured correctly, this would allow employees the chance to provide similar feedback to improve processes or efficacies. I say “structured correctly” because meetings need to be developed with 25 percent of the time dedicated to leaders discussing their agenda, and 75 percent of the time for employees to discuss their concerns, ideas, or issues. I call this the 25/75 rule for effective employee meetings. This rule, when applied correctly, guarantees consistent and dynamic sharing of internal best practices, improving productivity, and also raising the flag to any inconsistencies or irregularities.

Having developed and applied the 25/75 rule nearly 15 years ago in leading my own team, I can tell you honestly that in any instance where an employee was thinking of leaving the department, I knew well in advance. I was able to do so through observing daily their approach to their work, their team, and their role or based on the feedback of team members, who in several instances approached me asking if I recognized an issue with an employee, and suggesting something that I might want to follow up with. The rapport and trust this approach brings is powerful.

Connecting employees with the value they bring to customers isn’t difficult; it just takes a different approach in how leadership interacts with their people, and in turn how people interact with each other.