CX Competency: Compelling Brand Values (Video)

Temkin Group has found that the only path to sustainable customer experience differentiation is to build a customer-centric culture. How? By mastering Four Customer Experience Core Competencies.

This video provides an overview of one of those competencies, Compelling Brand Values, where the goal is to deliver on your brand promises to customers.

Here Are Three Steps to Compelling Brand Values:

Report: Lessons in CX Excellence, 2017

We just published a Temkin Group report, Lessons in CX Excellence, 2017. The report provides insights from eight finalists in the Temkin Group’s 2016 CX Excellence Awards. The report, which has 62 pages of content, includes an appendix with the finalists’ nomination forms. This report has rich insights about both B2B and B2C customer experience.

Here’s the executive summary:

This year, we named five organizations the winners of Temkin Group’s 2016 Customer Experience Excellence Award – Business Development Bank of Canada (BDC), Century Support Services, Crowe Horwath, Oxford Properties, and VCA. This report highlights specific examples of how these companies’ customer experience (CX) efforts have created value for both their customers and for their businesses, describes winners’ best practices across the four customer experience competencies: purposeful leadership, compelling brand values, employee engagement, and customer connectedness. it includes all of the winners’ detailed nomination forms to help you collect examples and ideas to apply to your own CX efforts.

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Here are some highlights from the winners:

Report: Translating Brand Promises into Employee Behaviors

We just published a Temkin Group report, Translating Brand Promises into Employee Behaviors. Here’s the executive summary:

Temkin Group has found that the companies that deliver great customer experience use their brand as a blueprint for how they treat customers, which is why Compelling Brand Values is one of our four customer experience core competencies. Too often organizations put a lot of energy into communicating the brand externally, only to fall short on connecting employees to their role in keeping brand promises. And when employees aren’t connected to these promises, they tend to be less proactive, to act inconsistently, and to care less about their work. In this report, we describe three steps that companies can use to translate their brand promises into employee behaviors: Make promises, Embrace promises, and Keep promises. To illustrate this approach, we share over 20 examples of best practices from companies including Anthem, A&W Food Services of Canada, the city of Centennial, Oklahoma City Thunder, and Quest Diagnostics. To evaluate how well your organization follows this approach, use Temkin Group’s Compelling Brand Promises Assessment.

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Here’s are two of the 15 graphics in the report:

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Modernize Leadership: Steve Jobs Demonstrates Purpose and Values

In a recent post, I discussed how management practices have become outdated and that there’s a strong need to Modernize Leadership. This change requires eight distinct shifts in how we lead organizations.

I just ran into this great video of a speech that Steve Jobs gave in September 1997. It’s really worth watching. Jobs demonstrates a few of the elements that I discuss in Modernize Leadership, and in particular he does a great job of highlighting this necessary shift:

5) Goals and Objectives to Purpose and Values

The bottom line: Tap into your purpose and values to drive simplicity

Modernize Leadership: Shifting 8 Outdated Management Practices

Over the previous decade, I’ve had the opportunity to work with and study thousands of companies. One of the things that I’ve noticed is that the world has changed a lot, but organizational management has stayed substantially the same.

Technology has enabled entirely new practices and we’ve developed a much deeper understanding of what drives human behaviors and business success. But these new realities have not been translated into how leaders run their companies. Instead, management techniques continue to reflect outdated assumptions such as:

• Mainstream economics works on the assumption of Homo Economicus, a model of people as rational self-interest maximizers. So “agency theory” informs management that employees can’t be trusted to act on behalf of the firm and, therefore, controls must be put in place to align their efforts.
• Strategic planning cycles (annually, quarterly) have been established based on a constraint of limited data availability. When these processes and cycles were initially created, it was impractical to more frequently pull together meaningful insights about the business.
• Management focus has been driven by economists like Milton Friedman who argued that corporate officials have one core responsibility: making as much money as possible for their shareholders. But the value that a company creates comes from a combination of resources contributed by different constituencies (not just investors) who’s returns should also be maximized, especially employees who contribute their knowledge and skills.

While these underlying assumptions aren’t necessarily discussed explicitly, they frame the basic structure of today’s approach to management. Well, it’s time to Modernize Leadership. We need to redefine how we run organizations based on the realities of today, which will require more inspiring leaders in the future.

To help make the shift, I plan to write individual posts that describe eight key shifts required to modernize leadership. In those posts I’ll describe the move from:

1. Command and Control to Engage and Empower
2. Strategize and Plan to Learn and Adjust
3. Amass and Review to Detect and Disseminate
4. Measure and Track to Observe and Improve
5. Goals and Objectives to Purpose and Values
6. Problems and Solutions to Strengths and Appreciation
7. Process and Projects to Culture and Behaviors
8. Price and Features to Experience and Emotions

The bottom line: Let’s Modernize Leadership together!

Report: Lessons in CX Excellence, 2016

We just published a Temkin Group report, Lessons in CX Excellence, 2016. The report provides insights from eight finalists in the Temkin Group’s 2015 CX Excellence Awards. The report, which is 100 pages long, includes an appendix with the finalists’ nomination forms. This report has rich insights about both B2B and B2C customer experience.

Here’s the executive summary:

This year, we chose eight organizations as finalists for Temkin Group’s 2015 Customer Experience Excellence Award. The finalists for 2015 are EMC Global Services, Hagerty, InMoment, Safelite AutoGlass, SunPower, The Results Companies, Verint, and Wheaton | Bekins. This report provides specific examples describing how these companies’ CX efforts have created value for both their customers and for their businesses. We also highlight best practices across the four customer experience competencies—purposeful leadership, compelling brand values, employee engagement, and customer connectedness. We have included all of the finalists’ detailed nomination forms at the end of this report to help you compile examples and ideas to apply to your own CX efforts.

Download report for $195

Here are some highlights from the finalists:

Report: B2B Customer Experience Best Practices

We published a Temkin Group report, Business-to-Business (B2B) Customer Experience Best Practices. This report provides data on the state of customer experience (CX) in B2B as well as 20 CX best practices across five critical B2B processes. Here’s the executive summary:

Temkin Group research shows that although business-to-business (B2B) organizations are raising their customer experience (CX) ambitions, they still have a way to go before achieving their goals. Despite the fact that most large B2Bs have a low level of CX maturity, our research shows that 57% of them aspire to deliver industry-leading customer experience within three years. However, to improve their CX, B2Bs must master Temkin Group’s four customer experience core competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness. Our research uncovered 20 practices that B2Bs can emulate when applying those competencies across these five key business processes: sales and account management, implementation/project execution, support and issue resolution, partner alignment, and product management and innovation. To assess your organization’s CX maturity, use Temkin Group’s Customer Experience Competency Assessment and compare the results to data from other large B2B firms to chart your path to improvement.

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The report examines the state of B2B CX, including the results from large companies that completed Temkin Group’s CX Competency & Maturity Assessment:

To help B2B organizations raise their CX maturity, we identify 20 best practices for mastering Temkin Group’s four customer experience core competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness. These practices are aligned with five key B2B activities: sales and account management, implementation/project execution, support and issue resolution, partner alignment, and product management and innovation:

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100 Customer Experience Tips in 105 Characters (Or Less)

I’ve decided to take on a personal challenge: Tweeting (@btemkin) a new customer experience tip for 100 straight days.

After accounting for the overhead in each tweet (like links back to this post), I’m only left with about 105 characters. Hopefully I can keep up the pace and pack insight into that limited space. I’ll be using the hashtag, #CXtip, so you can follow me on twitter (or just keep coming back to this post).

The tips will cover the four customer experience core competencies: Purposeful Leadership (PL), Compelling Brand Values (CBV), Employee Engagement (EE) and Customer Connectedness (CC).

Here are the 100 #CX Tips:

• #CXtip 1: Examine #insights for #customers’ journeys, not for individual, siloed interactions. (CC)
• #CXtip 2: Engaged employees are extremely valuable assets. They’re worth even more of your investment. (EE)
• #CXtip 3: You can’t fake it. Assume that customers & employees will always figure out what’s real & act accordingly. (PL)
• #CXtip 4: Great #brands are built on making, embracing & keeping promises, so be clear about your #customer promises. (CBV)
• #CXtip 5: #CustExp encompasses success, effort, & emotion. They all impact loyalty, but #emotion rules. (CC)
• #CXtip 6: Don’t waste customers’ time asking them questions unless you are prepared to act on what they say. (CC)
• #CXtip 7: #Employees are more #engaged when you ask for their feedback and act upon what they say. (EE)
• #CXtip 8: Build commitment by appealing to #employees’ hearts, shared values & intrinsic motivations. (PL)
• #CXtip 9: Not all customers are the same. Stop treating them as if they are. Think of using #personas. (CC)
• #CXtip 10: What people experience is not what they remember; so take advantage of how people remember things (CC)

Report: Creating and Sustaining a Customer-Centric Culture

We just published a Temkin Group report, Creating and Sustaining a Customer-Centric Culture. Here’s the executive summary:

Temkin Group defines culture as how employees think, believe, and act, and if an organization wants to differentiate its customer experience, it must address each one of these areas. However culture change is not easy. Culture change efforts are often impeded by common pitfalls, such as ignoring the existing culture or becoming impatient at the pace of change. To make this effort smoother, Temkin Group recommends adopting an approach we call Employee-Engaging Transformation (EET), which consists of five practices: Vision Translation, Persistent Leadership, Middle Management Activation, Grassroots Mobilization, and Captivating Communications. In this report, we’ve compiled case studies of how five organizations—Hagerty, Hilton Garden Inn, Oxford Properties, Safelite AutoGlass, and Transamerica—apply these EET practices to create and sustain their customer-centric cultures. To help your company discuss its goals around culture, use Temkin Group’s Cultural Planning Map.

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This graphics provides an overview of the details on how five companies are driving culture change.

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The bottom line: Promoters are much more valuable than detractors.

Report: Lessons in CX Excellence, 2015

We just published a Temkin Group report, Lessons in CX Excellence, 2015. The report provides insights from 8 finalists in the Temkin Group’s 2014 CX Excellence Awards. The report, which is 98 pages long, includes an appendix with the finalists’ nomination forms. This report has rich insights about both B2B and B2C customer experience.

Here’s the executive summary:

This year, we chose eight organizations as finalists for Temkin Group’s 2014 Customer Experience Excellence Award. Finalists are Activision Customer Care, Aetna, Crowe Horwath LLP, Dell Inc., EMC Corporation, Texas NICUSA, The Results Companies, and TouchPoint Support Services. This report provides specific examples of how these companies’ CX efforts have created value for both their customers and for their businesses. We also highlight their best practices across the four customer experience competencies—purposeful leadership, compelling brand values, employee engagement, and customer connectedness. At the end of this report, we have included all of the finalists’ detailed nomination forms to help you collect examples and ideas to apply to your own CX efforts.

Download report for $195

Watch Temkin Group webinar about this research.

Here are some highlights from the finalists:

• Activision Customer Care. Activision demonstrates its commitment to creating great game player experiences in a multitude of ways, such as emphasizing the use of player feedback to identify improvement opportunities. Activision combines this dedication to listening to its players with a willingness to redesign significant interactions. For example, it revamped its “Contact Us” page to include ambassador chat and callback scheduling, which resulted in higher satisfaction and lower effort for customers.
• Aetna. Despite being in an industry undergoing tremendous change, Aetna is focusing on its 2020 vision to make the company 100% customer-centric. It has implemented many changes to help achieve this goal, including providing service over the phone and investing in text and speech analytics to better identify customer pain points and improve the behaviors and skillsets of its call representatives. The latter effort has already resulted in reduced repeat calls, improved accuracy, and a higher Net Promoter Score (NPS).
• Crowe Horwath. With a client engagement score towering 33 points above the accounting industry average, Crowe Horwath is seeing the pay-off of its efforts to deliver an exceptional client experience. These efforts include establishing a firm-wide governance model and measurement scorecard, implementing a closed-loop voice of the customer program, incorporating customer journey mapping to uncover moments of truth, and engaging employees through training, client-driven CX recognition programs, and an employee ambassador program.
• Dell. Dell’s CX efforts start with an emphasis on listening to and engaging with customers and employees. Dell enlists different groups from across the company—including engineering, marketing, sales, support, and digital—to make improvements to the entire customer journey. As a result of this work, Dell has opened 16 solution centers—which gives customers a place to experience solutions—and has provided proactive support over a wide variety of social channels, simplified Dell.com for consumer and business users, and implemented more than 540 customer innovation ideas.
• EMC Corporation. The Total Customer Experience (TCE) program at EMC works across the enterprise to enhance the company’s customer experience by listening to customer feedback, analyzing data, and taking directed action based on that feedback and data. The program also raises awareness of how every person at the company impacts customer experience. As its CX efforts have matured, the TCE team has evolved to take on more challenging tasks; its projects now include predictive CX analytics, measuring its partner experience quality, and optimizing the experience across many different customer segments and solutions.
• The Results Companies. To support its work as a business process outsourcing provider, The Results Companies uses its own unique operating model called CX360, which allows for continuous business process refinements that improve the customer experience. Built on three pillars—people, knowledge, empowerment—CX360 has helped the company ensure that its 8,500 employees around the globe remain focused on CX. The operating model has also contributed to Results’ strong growth in new clients and year-over-year revenue.
• Texas NICUSA/Texas.gov. Texas NICUSA provides support for Texas.gov and implements technology solutions for Texas governmental agencies. It serves over 50,000 monthly site visitors and 300 state and local governments. Its three-tiered multi-channel customer service approach includes a general customer service Help Desk (phone and online), a Service Desk to support governmental agency needs, and a group of Technology Subject Matter Experts who can provide escalated assistance to either citizens or agency employees.
• TouchPoint Support Services. TouchPoint Support Services streamlines support services within healthcare facilities. The company’s business goals, known as Top of Mind Objectives, guide the work of its 6,800 associates, helping them to find inefficiencies and improve patient satisfaction, associate engagement, safety, unity, and budget compliance. Touchpoint uses many methods for aligning employees with these objectives, including special training for managers and frontline employees, coaching from dedicated customer experience managers (who visit sites regularly), and associate recognition programs.

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If you enjoyed this report, check out Lessons in CX Excellence, 2014 and Lessons in CX Excellence, 2013.

The bottom line: There’s a lot to learn from these CX Excellence Finalists.

Simple Lessons From Great Clips’ Success

As I mentioned in my post about Amazon’s relentless customer advocacy, I recently attended the Arizona State University, Center for Services Leadership (CSL) Compete Through Service Symposium.

One of the speakers was Ray Barton, Chairman of Great Clips. He had a great story, explaining how he led the company from a little four salon outfit in 1983 to a behemoth operation with 3,300 salons and 30,000 stylists. It’s the largest and fastest growing hair care brand. Supercuts, by comparison, has 2,300 locations.

Barton was clear about what was important in his business: clarity and simplicity. He made a number of points that are valuable for many others to follow. Here’s my take on some of what he presented:

Focus on the Customer
The hair care industry was fragmented and organized around the stylist, not the customer. By focusing on customers, the company did innovative things such as opening during evenings and all day on Saturday, offering $6 haircuts, and not requiring reservations. He was clear about what his customers want: quality, convenience, and value.

• My take: Most organizations make decisions based on internal needs. It’s powerful when you take a look at things through your customers’ eyes. Think about adopting customer journey thinking.

Four Simple Steps
Barton said that he ran the business based on four simple things: (1) Ask customers what they want, (2) Give it to them, (3) Ask them if they got what they wanted, and (4) Thank them.

• My take: The only thing I can say is… these are the best four steps that I’ve ever seen.

Everyone is the Brand
Barton said “everyone in our organization can draw a line from them to how they affect the customer, or we don’t need them.”

• My take: This should be true for every employee at every company. Great companies have employees that understand and embrace their role in delivering on brand promises. This is also the essence of one of our four CX core competencies, “compelling brand values.”

Growth is an Outcome
Barton believed in the rifle, versus shotgun approach to expansion. Rather than following other franchises such as Krispy Kreme and Boston Market that expanded into many different markets, he focused on building density in a few areas at a time. This provided the marketing clout and brand awareness in those areas. It also allowed the company to focus on good real-estate decisions and make sure that staff was adequately trained.

• My take: Growth should come from successfully delivering on your brand promises. If not, then your organization may get bigger, but it will certainly lose its focus and values along the way. That’s a lesson that even Starbucks needed to learn.

Simple, Powerful Metrics
Barton described how at one point during its growth, the company lost its focus and simplicity. They simplified their brand measures from 33 columns down to 5 measures that now all fit on one page. He actually said that only two measures are really important, what he calls 30/30: 30% of stylist hours occur during weekends and 30% of new customers come back. Since then, the company has had 40 consecutive quarters of same solon sales growth.

• My take: When it comes to metrics, less is often better. A simple set of metrics that everyone understands is a powerful way to align everyone in the organization around what’s important.

The bottom line: Simply stay focused on your customers and your brand.

Examining Amazon.Com’s Relentless Customer Advocacy

Last week I attended the Arizona State University, Center for Services Leadership (CSL) Compete Through Service Symposium. It was an excellent event. I was impressed by what the CSL is doing to equip future customer service/experience leaders.

One of the speakers was Mike Gathright, Director Americas Customer Services at Amazon.com. He describe Amazon.com as “The Earth’s Most Customer-Centric Company,” or just EMC³. It’s no accident that Amazon.com scores so consistently high in the Temkin Experience Ratings and Temkin Customer Service Ratings. The company works on it.

I really love one of the company’s tenets, Relentlessly advocate for customers. It sounds like something that all companies should strive to do.

Gathright explained that Amazon.com has three key priorities:

• Empower your people
• Listen to customers
• Invent for customers

To deliver on those priorities, the company uses a number of internal quality processes including Kaizen (continuous improvement) and Genba walk (seeing and observing the actual process or activity).

One of the quality efforts that I really like is the use of an Andon Cord. This is a concept where any employee can identify a quality problem and halt manufacturing. The implementation at Amazon.com is that any phone agent can pull the Andon cord (not a real cord), which will remove the buy button from all of its sites, immediately stopping the sale of a product. This step kicks off a process for the product team to find and solve the root cause of the problem.

To get the Andon cord going, Amazon.com celebrates its use and analyzes the savings from avoiding quality issues with products sent to customers. The company also built a tool to help associates decide if the situation they are seeing warrants them pulling the Andon cord.

Gathright also discussed the notion of one-way doors and two-way doors in the context of innovation. One-way doors are changes that you can’t undo, while two-way doors are changes that can be undone if they don’t work. He said that Amazon.com goes big and bold through two-way doors.

The company taps into its employees with a Twitter-like tool internally to crowd-source ideas. Employees submit ideas and they get voted up or down based on the likes and dislikes from associates. Gathright also said that the company believes in “hiring the right people and getting out of their way.”

To measure the effectiveness of Amazon.com’s customer service, the company asks a simple question: “Did we solve your problem?” The answer to that question is the only key metric.

When asked about the trade-off between CX and bottom line results, Gathright explained that it’s not “either/or,” it’s more like “both/and.”

The bottom line: Amazon.com is purposeful about delivering great CX.

CX in the C-Suite: Webinar With Mercedes-Benz CEO

As part of Customer Experience Day, I interviewed Mercedes-Benz USA (MBUSA) CEO Steve Cannon on a CXPA.org webinar called Customer Experience from the C-Suite. Cannon was energetic and informative in describing how MBUSA has infused a strong sense of CX across its organization as well as across the company’s network of 375 dealership franchisees.

One of the highlights of the webinar was when Cannon said that “customer experience is the new marketing” and is critical for fulfilling MBUSA’s brand promise, The Best or Nothing.

Here are some other highlights and lessons from the webinar:

• The CEO plays a critical role in CX. Cannon was clear on the role of the CEO in driving CX across the organization. “If the CEO doesn’t take CX personally, he’s not going to be able to convince people that it isn’t just the flavor of the month.” He called himself the “Chief conversation starter” and “Chief Evangelist.” Cannon mentioned that CX is a topic in every single town hall and when he visits a facility, he says, “Don’t give me a facility tour, give me a customer experience tour.” (Related: CX Mistake #1: Faking Executive Commitment).
• Change takes focused leadership. Cannon pointed out that historically; CX resided in too many siloes (sales, marketing, presales, etc) across MBUSA. One of the first thing Steve did was reorganize around CX, carve CX out of different business units and put them together in one unit with a General Manager who reports directly to him. (Related: State of CX Management, 2014).
• Alignment is well worth the investment of time. When CX became the MBUSA’s main objective, the executive team went offsite and spent two days debating and critically examining the organization’s CX—where they were coming from and where they were going. This meeting incorporated the voices of General Managers into MBUSA’s CX plans, making them what Cannon called “co-architects.” Afterwards, Cannon held similar meeting with the next two levels of leaders across the company. (Related: WL Gore Succeeds Without Employees).
• It all starts with employee engagement. Cannon said that Employee Engagement is a precursor to CX. Cannon stated that “MBUSA is committed to investing in people because they are the only ones who can create great CX.” And Cannon is investing in this area. He discussed the company’s Immersion Program. Over the next few years, 26,000 employees will visit the MBUSA plant in Alabama and go through a learning journey that includes driving cars and visiting the company’s brand center. (Related: The Untapped Value of Employee Engagement (Infographic)).
• CX is about culture, not a veneer. Cannon mentioned that great leaders create culture that creates great customer experience. That’s why Cannon is so proud of MBUSA leadership academy. He said that CX is in the DNA of the MBUSA, and is its higher calling. (Related: Driving Customer Experience Transformation, Made Simple).
• “Satisfaction isn’t enough.” Cannon stated that any company can satisfy customers just by operational excellence and performing a transaction right. Instead of satisfaction, MBUSA wants to delight its customers. To measure this objective, MBUSA is changing its metrics to include Net Promoter Score within a basket of other metrics. (Related: Customer Effort, Net Promoter, And Thoughts About CX Metrics).
• Engage your channel partners. Cannon was clear that dealers have the ability to amplify, accentuate, or marginalize everything MBUSA does. He explained that 2.5 points out of the 5.5 points of performance bonus that dealers can earn are related to delivering great customer experience, which results in a $40 million customer experience payout across dealers. Cannon was proud of the “Drive a Start Home” program that provides dealer employees with a Mercedes-Benz to drive for two days. (Related: Our B2B content plus an upcoming report on B2B2C CX).

Check out last year’s webinar with Dan Hesse, CEO of Sprint.

The bottom line: CX leaderships requires executive leaders like Steve Cannon.

Lesson From Dana-Farber: Treat The Whole Person

As part of yesterday’s Customer Experience Day celebration, I attended a CXPA local networking event at the Dana-Farber Cancer Institute (DFCI) in Boston. The session kicked off with a panel from the DFCI discussing patient experience.

I’m a big fan of DFCI and have enormous respect for the great work that it does in battling cancer. The panel, which included a cancer survivor turned volunteer, was fantastic. I was inspired by the commitment and compassion they displayed.

One of the points that came up was DFCI’s commitment to treat the whole person. This explains why it provides things such as hand massages during chemotherapy treatment. DFCI doesn’t just treat the disease, it treats the whole person.

I love the concept of the whole person. It’s not just applicable to DFCI or other health care providers, but to every organization. It’s a powerful concept for anyone who cares about customer experience.

Here’s how I think about the whole person:

• Emotion, not just success. DFCI doesn’t have data showing that hand massages will result in better clinical outcomes. It knows that a patient’s positive medical outcome is important, but it’s not enough. Your customers are the same. You need to understand, care about, and actively design for your customers’ emotional states.
• Goals, not just interactions. A chemotherapy patient is battling cancer, not just getting treatment. When customers interact with you, it’s often part of a broader goal. A customer who calls to change her address, for instance, probably has a life change going on that dwarfs the need to update your administrative systems. The better you can understand and cater to these larger goals, the more opportunity you will have to build loyalty.
• Community, not just individuals. One of DFCI’s key elements for helping patients is supporting their caregivers. These people are a critical element of the patient’s medical journey. Your organization needs to understand the role that community plays in your customers’ lives. How can you help your customers achieve their goals by supporting key members in their personal ecosystems?
• Caring, not just doing. DFCI doesn’t just mandate a set of explicit activities that define how people should focus on the whole person, it consistently reinforces the importance of this focus in achieving DFCI’s mission. It gets employees and volunteers to care about these elements, not just follow a bunch of directions. You need to help employees understand why the whole person is important, and spark their natural capabilities for caring.

I hope that you are inspired to drive your organization towards focusing on the whole person. Here are a few tools that should help:

• Pick out a few ideas to replicate from our 25 Tips for Amplifying Empathy.
• Spread the focus across your organization using Customer Journey Thinking.
• Design for the whole person using People-Centric Experience Design.

The bottom line: Start focusing on the whole person!

Nadella Pushes Microsoft to Rediscover Its Soul

In a letter to all Microsoft employees called Starting FY15 – Bold Ambition & Our Core, CEO Satya Nadella established a mandate and vision for significant change across the technology behemoth.

Microsoft has great assets, but it has not kept up with changes in how people use technology. The Redmond giant was becoming increasingly less relevant in a world where digital technology is becoming more relevant.

Microsoft has needed to change for a while. There’s a saying that the best time to plant a tree is ten years ago and the second best time is right now. Nadella has made it clear that Microsoft’s time for change is right now.

My take: First of all, it’s hard to talk about any large-scale culture change without recommending that people review our model called Employee-Engaging Transformation, which is built on five practices: Vision Translation, Persistent Leadership, Activated Middle Management, Grassroots Mobilization and Captivating Communications.

We work with many of the world’s leading technology companies, so I could go on and on about what changes are necessary at Microsoft. But I’d rather examine broader lessons from Nadella’s letter. Here are some excerpts that I thought were particularly valuable to discuss:

“...in order to accelerate our innovation, we must rediscover our soul – our unique core“

Successful companies almost always start with a strong raison d’être, but it can get lost as the company grows and the world changes (see my post on Starbucks). Without a “soul,” companies drift along as employees across the organization start operating in a disconnected way. This is where the brand comes in. Companies need to constantly refresh their brands and make sure that the brand drives decisions across the organization (see my post on Walmart).

“More recently, we have described ourselves as a “devices and services” company. .. At our core, Microsoft is the productivity and platform company for the mobile-first and cloud-first world. We will reinvent productivity to empower every person and every organization on the planet to do more and achieve more.”

Our research shows that employees are more productive and engaged when they are inspired by their organization’s mission. Which one of these statements do you think is more inspiring: “We are the devices and service company” or “We will reinvent productivity to empower every person and every organization on the planet to do more and achieve more.”

“We will create more natural human-computing interfaces that empower all individuals.”

This is a comment about technology, but its also points to a broader commentary about making things easy to use. We have entered into a world where people have more options, more distraction, and less patience. Every organization needs to relentlessly focus on making their products, services, and processes easier for customers to use.

“Obsessing over our customers is everybody’s job. I’m looking to the engineering teams to build the experiences our customers love.“

What’s not to love about this excerpt. My customer experience manifesto (and Temkin Group, for that matter) is built on a fundamental belief that sustaining great customer experience is not about applying a veneer, but about building competencies across the entire organization that create great experiences for customers (see our four CX core competencies). Also, it’s interesting that Nadella used the word “love.” Experiences are made up of three component (functional, accessible, and emotional) and our Temkin Experience Ratings show that companies are weakest at driving the emotional component. To get people to “love” your company, I suggest applying what we call People-Centric Experience Design.

“I am committed to making Microsoft the best place for smart, curious, ambitious people to do their best work.”

One of the Six Laws of Customer Experience is that unengaged employees can’t create engaged customers. Any company looking to improve how it interacts with customers almost certainly needs to focus on its employees.

“We will be more effective in predicting and understanding what our customers need and more nimble in adjusting to information we get from the market.”

How companies use customer insights is changing rapidly. Technologies such as text analytics and predictive analytics are helping companies tap into more comprehensive and ongoing insights, rather than relying on periodic customer surveys. Ultimately, companies will need to reinvent their operating frameworks so that they can adjust more frequently to take advantage of these rapidly-flowing insights.

“Nothing is off the table in how we think about shifting our culture to deliver on this core strategy.”

This type of statement only works if it’s backed up by clear actions that employees can observe. These “symbols” of change need to be clear departures from how the company operated in the past, and can include reorganizations, firings/hirings/promotions/demotions, killing projects, accelerating projects, etc.). Don’t just say change is coming, demonstrate it (see the 3 characteristics of transformational leaders).

“We must each have the courage to transform as individuals. We must ask ourselves, what idea can I bring to life? What insight can I illuminate? What individual life could I change? What customer can I delight? What new skill could I learn? What team could I help build? What orthodoxy should I question?”

The notion of a personal challenge is a great way to help employees think about how they can be (and must be) a part of the change. But the questions won’t be too powerful if they are just statements in a letter from the CEO. Use these questions as part of discussions across the organization and embed them into leadership training and competency models.

 The bottom line: Change isn’t easy, but Microsoft seems ready to give it a try.