Stop confusing people with jargon!

  

Mark Fitzsimmons is President of 360 Degrees Management Consultants – I help businesses generate improved financial performance by optimizing internal operations and creating a differentiated customer experience.

A funny thing happened on my way to becoming a Lean Six Sigma Master Black Belt. I learned a new language: Lean Speak. What’s fascinating is that I didn’t realize it at the time. It just happened. Admittedly, it’s not a well know language, but it is used pervasively by Lean and Six Sigma practitioners who try to convince people to adopt and use it.

In all seriousness, too many of us, regardless of what we do or where we work, tend to use language, acronyms or jargon no one else understands. It only means something to a sub-set of people. And that’s a problem. To those who don’t happen to work for our particular organization, or who work in another department, or in a different function; we use a vernacular that makes it difficult for the recipient to understand what we really mean. A smile and a nod isn’t always a good thing. Maybe they misunderstand us and do something different than what we intended, or maybe they just don’t care enough to tell us they don’t know what we’re talking about. 

Too many organizations use terminology or jargon or acronyms that confuse outsiders. It makes it harder to convey important information because the message gets lost in translation. I can’t stress enough that there’s tremendous value in using words that are easily understood by stakeholders, rather than confusing things unnecessarily.   

In the case of Lean Six Sigma, it’s particularly worrisome because we’re often working on issues that are the most important to the organization. If we confuse matters by using unnecessarily complicated language, we risk costing the business. It could be financial, it could be customer related, or it could be that employees simply don’t buy in to what we’re trying to do.  

We use terms like Muda (waste) and Kanban (signboard) and kaizen (change for the better) and a litany of other words that only insiders know. And while these terms might sound impressive, they really represent straightforward ideas.

I was in Tokyo, Japan a while back and had the good fortune of being invited to visit a heavy equipment manufacturer. While I was incredibly impressed by the adoption of ‘Lean thinking’ and saw many Lean practices being used, from their perspective they were just going about their business. It wasn’t a program or initiative and they didn’t use fancy or confusing words.

Too many practitioners use words or phrases that relate to their Japanese origin. Muda is the Japanese word for waste. In Japan it makes sense to call it muda. So why do Lean Six Sigma practitioners use it outside of Japan? Similarly, we hold “kaizen events”. The words “kai” and “zen” translate to change for the better. Shouldn’t we simply say that? When we use words like Kanban, Hoshin Kanri, Gemba and others; we do a disservice to the people who are turned off of it because of the confusing language.  People who might benefit tremendously if only we communicated the ideas better.

Lean Six Sigma is an information driven approach used to optimize processes and enable you to consistently deliver value to your key stakeholders. The goal is to perpetuate continual improvement towards perfection; perfection through the lens of the customer. Shouldn’t that be every organizations goal? Don’t we have an obligation to give to our customers what they asked and paid for?

At 360 Degrees, we’re pragmatic in our use of Lean Six Sigma. We use only the tools that make the most sense for each situation. We help enable companies to identify and focus on the process changes that will quickly make the biggest differences, ensuring faster results with smaller initial investment.

The Case for Nordstrom: Setting Expectations and the Perils of Dissapointment

Let me begin with a confession. I'm a big fan of Nordstrom (JWN). I've shopped at their stores from New York to Chicago, from California to Nevada, and of course at their first store on 6th and Pine in Seattle. Let's just say that Brent and Justin in Personal Styling know me by name and I can order without a menu at their cafe....try the strawberry almond chicken salad...but I'm worried. I'm worried because they might disappoint. 

As Nordstrom gets set to open its Canadian flagship store in Vancouver, its chief competitors are quietly making changes to their operations; Holt Renfrew has acquired more space to expand and will open an in-store cafe, Harry Rosen is undergoing renovations to modernize its space, while the Hudson Bay company makes plans to debut its Saks 5th Avenue brand.

While this might seem like a local story about a successful fashion retailer entering a new market, it's not. It's a story that tells a cautionary tale for every business, regardless of industry or size. It's a story about setting realistic expectations for your customers. Whether you're a one-person startup working to introduce a new technology product, an established industrial business manufacturing widgets, a political leader giving a state of the city address, or a fashion retailer selling to consumers; this is a story that applies to you. 

Regardless of what you do, the products, services or ideas you sell, your customers always have a choice. One of the primary reasons people buy from you is based on their expectations of what they think you'll deliver. They count on you to live up to that expectation, fairly set or not.

The more we communicate by design, the better able we are to ensure the message is what we intend. When we fail to do this adequately, or worse yet leave it to chance, we inevitably disappoint. 

Just ask Apple (APPL) who watched it's stock price tumble 8% after the company reported it sold fewer iPhones than expected in the previous three months. 

"The company sold just 47.5 million iPhones....while that's up a stunning 59% from a year ago, the number of iPhones sold last quarter is still fewer than the 49 million analysts had forecast...." 

The concern for Nordstrom is that consumers have heard so many great things about the company they might have unrealistic expectations. Like Apple, no matter how good they are, or how great their store in Vancouver is, if consumers have expectations that are unrealistic, Nordstrom could disappoint and drive consumers to its competitors. 

What's reassuring is that Nordstrom didn't become as successful as they are by chance, just read The Nordstrom Way and you'll understand. The sophistication of their plan is stunningly simple. They empower their employees to "Use good judgement in all situations", and then support them with systems and training to set them up for success at building long-term relationships with their customers. They aren't going though all of that work just to sell you a single pair of socks. They want you to come back next month when you buy that pair of shoes to match the socks, and next season to buy that suit to go with those shoes, and so on. It's about the relationship.

What Nordstrom, like anyone else needing to establish realistic expectations needs to do is follow this five point plan:

1. Communications: The message needs to be simple, clear and coordinated in a consistent way across all channels. It must be truthful and convey genuine sincerity. Employees will need to be trained to understand and take ownership of the message when they deliver it. For all intents and purposes, they are the enterprise to the customer. Think Harry Truman's immortal words. "The buck stops here". Communications might be conveyed with words, but more often than not, they're conveyed through our actions. Employees need to be empowered if they're expected to take action.
2. Employee empowerment: If employees are going to take ownership of any given situation, and display genuine empathy, they need to be empowered to do what they believe is right. This is predicated on trust; trust between the enterprise its employees. If they believe it's something beyond what they believe they can address adequately, or it's a recurring issue they believe is systemic, they need to have a process in place that allows them to escalate the issue. Maybe for validation that they're making the right decision, or maybe because something is broken and needs to be fixed.
3. Processes and systems: Processes and policies are designed to make the enterprise easy to do business with, while being consistent across all channels of delivery. An example is the employee who recognizes a recurring, systemic issue and escalates it. That employee needs to be able to trust there is a process in place to address that issue so that it won't continue to cause problems; for them and their customers. When employees are empowered, they need to be set up for success. They need to be able to trust that their actions are connected into a system that drives intended results. 
4. Employee engagement: Employees need to have a clear and visible vision they can believe in. Something that excites and inspires them. A vision they want to support and work hard for because they aspire to be part of that vision. Across every level of the enterprise, the vision is clear and consistent. 
5. Embed continuous improvement in the culture: Nothing stays the same. Stakeholder expectations change, products change, technology changes, everything eventually changes. When an organization embeds continuous improvement into the culture, they make it easy for employees to be successful because the systems are designed for success, and are continuously refined. Moreover, employees are involved in that change and have a voice in how it evolves. They'll take this responsibility very seriously and provide far more insight because this involvement is pervasive across the organization.

Provided they stay focused, and can translate this into the culture at the Vancouver store, Nordstrom will succeed, raising the bar for everyone in the retail space.  And this will be good news for consumers. The competition will force everyone to get better, or get left behind. 

Now in all fairness, Nordstrom does have some previous experience introducing stores into new Canadian markets: Calgary and Ottawa. Provided they use the lessons learned through these experiences, they can leverage this data to improve where they might need to, or persevere and continue doing what's worked well for them. Following a Lean Startup approach.

And that might be the final lesson: use the information gained from what you've learned, pivot and change when improvement is needed, or persevere and continue doing what works. 

And seriously, try the salad.

7 Ingredients Needed to Successfully Launch Any New Initiative

Every organization, at one time or another, is going to attempt to launch a major initiative because they believe it’s necessary to their immediate well-being, or even long-term survival. It might be an initiative intended to reduce costs or increase revenue, it might be intended to generate increased customer loyalty, or it might be to introduce an operational excellence program such as Lean Six Sigma; but every organization will launch one from time to time. 

When done well, it’s transformative and delivers as intended. But when it isn’t done well, it consumes resources and squanders the goodwill of its stakeholders; often making the next initiative that much harder to introduce successfully because it’s viewed as the        next ‘flavor of the month’. 

"... And it ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. Because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.”

So if change is inevitable, and something every organization engages in, why is it potentially so perilous? It becomes perilous when forced upon people through fear rather than by earning their trust and winning their buy-in. This is when change initiative fail, and those leading the charge become their casualties.

But does a new initiative or any change management activity have to instill fear? Absolutely not. I’ve been involved in change management and the introduction of new initiatives at a local, national and international level and there is a recipe. When the recipe is followed, the results deliver the success that was hoped for, often times even more so.

1. Decide to take action. There’s a cost to delaying action. If, for example, an initiative might     generate $600,000 in annualized savings, each month you wait for circumstances to be         ideal, it's costing you $50,000. That's $50,000 you'll never recoup. Too often                         organizations wait for circumstances to be 'just right'. The reality is that there will never be     a perfect time. There will always be someone wanting more information or more analysis,     or wanting something to be different before moving forward. As your competitors move         forward, you either keep up with the pace or you fall behind. Not moving forward is like         taking a step backwards. There's some truth to the saying "paralysis by analysis". 

2. Invest your leadership capital. A leader must invest her/his: time, budget (resources) and     enthusiasm in the initiative. People must believe it's got the leaders attention and buy into     that vision. The leader won't necessarily manage the initiative on a daily basis, but they         need to be seen as the person leading the charge. If there is an initiative leader, they             need to be seen as an extension of the leader, and speaking on their behalf. The initiative     must be a priority for the leadership.

3. Leverage early adopters. There will often be 15% that embrace a new initiative and are         excited by the chance to step out of their comfort zone to change for the better, just like         there will be another 15% who resist new ideas and want to keep doing things the way         they've always done them; because it's comfortable. Don't spend time on the 15% who         resist. The early adopters can win over the bulk of the 70% who are sitting on the                   sidelines waiting to see what happens. It'll become clear early that if this is a priority for         the leadership, and the early adopters are getting attention and some rewards, that they'll     want to get onboard as well. It won't take long to reach a point where those people who         just won't support the initiative will be in the minority and will either join, or get weeded           out. It’s OK if they’re weeded out. In the long run, they’ll be happier somewhere else.

4. Communicate the vision clearly and often. The vision should be stated in simple terms           everyone understands. Don’t over complicate the message or introduce the opportunity         for people to interpret it in different ways. It needs to be crystal clear to every person             across the enterprise what we're doing, why, and how they plug into it. Use a variety of         channels to make it easy for people. A word of caution, it’s also critical to be truthful and       transparent in how it will impact people. In the absence of information, people will make         assumptions to fill the void. These assumptions will undermine the initiative and create         mistrust. People who do not trust or support the initiative will find a way to sabotage it. 

5. Make it easy for people to do the right things, and hard not to. Create opportunities for           everyone to support the initiative in a way that makes sense for them. Make it harder not       to support the initiative than to support it. You want people to be set up to be successful       and to make it easy for them to be so. It might take several iterations, but keep working         on this until you get it right. Build the processes and systems, measure the performance,       and adjust as you learn. This way, if you try something and it doesn’t work, you’ll fail             quickly…pivot…and improve based on what you’ve learned.

6. Identify and celebrate the wins, early and often. Go out of your way to recognize people       who exhibit wanted behaviours and who visibly support the initiative. When people are         celebrated, it builds self-esteem and sends a clear message that they matter. It validates       them and affirms what’s expected of them. They are set up to be successful, and will buy     into the vision. They’ll be excited to come to work because they’re part of a community of     people who are committed to accomplishing great things. 

7. Ensure there is accountability. There's truth to the saying, "what gets measured gets             done", so you'll want to have metrics that encourage support for the initiative. But you'll         need to be thoughtful about any metrics used because you’ll want to ensure you avoid           unintended consequences. A zero tolerance policy needs to be in effect for all metrics.         Manipulating measures or worse, cheating cannot be tolerated. Integrity must be non-           negotiable. 

This takes hard work and commitment, and it doesn’t happen overnight; but the results are transformational. Every great organization stands for something. And when it stands for something, its people buy into that vision. It’ll drive their behavior and inspire them to act in ways that support the vision, not because they have to, but because they want to. 

This doesn’t happen by chance or without design. It takes a carefully constructed plan (recipe) executed at all levels across the organization. With the right ingredients, success will follow. And that’s fun to be around.

Becoming a recording star starts with great customer service

Becoming a recording star starts with great customer service

Mark Fitzsimmons - 360 Degrees Management Consulting

My brother-in-law is in the music business; along with writing and recording, he has a production studio and typically receives a few hundred demos from musical performers each week. Recently, he lamented that many of them don't even take the time to write much about themselves. Amazingly, a couple of people have literally asked him, to Google them, to hear their music rather than making it easy for him by providing it directly.

What they fail to appreciate is they're competing for his, or any other music industry executive’s time, with every other 'wannabe' artist. They haven’t aligned their interests with his in a way that makes it easy to see why a relationship is of mutual benefit.

There's a remarkable similarity to the way many organizations behave. Both fail to appreciate that their customers have a choice. Ironically, more and more, organizations are being commoditized as customers aren’t seeing a meaningful difference between brands. 

His advice? “If you want to get noticed, try and do something creative”. Whether you’re a business or a potential recording star, you need to find a way to differentiate yourself from your competitors.

What are you doing to stand out from the crowd?

There’s a lesson here. Regardless of what you’re selling, or whose attention you’re trying to get, you have competition. You need to make it as easy as possible for your customer to choose whatever it is you’re selling; a product, a service; or your potential to become a recording star.

Any potential recording artist, or business that wants to capture the attention of potential customers, needs to find a way to stand out from the crowd. That might mean being creative in your pitch or providing something unique, but you have to create something that sets you apart from everyone else and compels potential buyers to give you a chance.

Have you ever stopped to ask yourself, or your employees, why should anyone buy from us? Were you impressed by your answer? If not, neither are your customers. Worse yet, if your answer isn’t aligned to the answers you hear from across your organization, what it’s like for your customers to do business with you?

Here’s a test: 

1. Do you know what it’s costing you in lost sales?
2. Do you know your market share for the products and services you sell?
3. Do you know the share of wallet for existing customers of the products and services you sell? 

Great organizations find a way to do this. They create an image their brand becomes known by; and it’s very rarely the actual products or services they sell. It’s usually something that makes their products or services desirable. It’s what their customers are really buying. Whether you drink Coca Cola because ‘It’s the real thing’, eat at Subway because it’s ‘Always fresh’, or watch CNN because ‘It’s the most trusted name in news’, you need to have it.

A great product or a great service is not enough. It has to be packaged in such a way that the customer’s experience resonates and generates a positive emotional connection to it. Fans of Apple products are passionately loyal. So much so, they line up hours in advance of every new product release with a willingness to pay a premium for their products.  

One final test: 

1. Do you know the value of a customer?
2. What is the lifetime value of a customer (by product, service or other meaningful category)?
3. What is your customer attrition rate?
4. What is ‘word of mouth’ worth; positive and negative?

It takes a well-constructed, carefully planned and flawlessly executed effort.

Creating a customer experience that separates you, or your business from everyone else requires a thoughtful and carefully planned approach that translates the needs, wants and wishes of customers into actionable strategies. When accomplished, it serves as a protective shield because it differentiates you from the competition and serves as a rallying point for employees and fans alike. Employees are proud to represent the brand and have a vastly better understanding of what their actions need to be in any given situation in order to support it. And ultimately, it’s what your fans come to love about your business.

4 Steps to Customer Loyalty – Tips from a reformed credit manager

One of the best lessons I ever received came from a battle worn sales veteran who told me, “Mark, you’re a nice guy, but no one wants to talk to you...”. What he really meant was, when the credit manager calls, people either expect to hear bad news or think they are being called for money. In my case, it was usually a one sided exchange when I was calling; and it wasn’t in the customer’s favor.

In too many organizations, employees see their interaction with the customer from one side – theirs; but it doesn’t have to be this way. Regardless of what our ‘job’ is, each of us can play an integral role in creating a positive and constructive experience our customers will remember, and appreciate. One that will generate loyalty because they know we’re looking out for them; we’re on their side and invested in their success. 

Step one – Be good for the customer

All too often, employees fail to appreciate the value they can bring to a customer exchange; beyond performing the basics of their job.  In other words, not just being good to the customer, but rather being good for the customer. 

Whether you’re in sales, operations or credit; there are likely going to be opportunities where you can step out of your box and provide added value to the customer. Whether it’s by helping the customer solve a problem they’re having or serving as their advocate within your business, there are often ways we can use our unique expertise. As a credit manager, I looked for ways to help my customers because I knew it meant they would continue coming back to us. Our customers didn’t think of us merely as a supplier, they considered us as a partner who cared about them and contributed to their success. A nice by-product was that we were also generally the first to be paid.

Step two – See the work you do through the lens of the customer

In most organizations processes are designed with the organization in mind and often at the convenience of the business, not the customer. Whether it’s the forms we want filled out or the policies and procedures we expect our customers to follow, they were probably designed from our perspective. We get so used to things being the way they are, we either forget how hard they were to understand in the beginning or we fail to see them for what they really are. But from our customer’s perspective, we’re hard to do business with. Moreover, the difficulty we create can overshadow the value of our products or services. Stated more simply, we drive them to competitors who are easier to do business with. It’s unlikely our products or services will be so superior to our competitors that customers will put up with the frustration if there is someone else who is easier to do business with.

Fortunately, this can be remedied. By creating a customer journey map, and identifying each customer touch point, we can think about the process through the lens of the customer. The goal is to transform the current process into one that is designed with the customer in mind.

Step three – Communicate proactively

Few things raise our anxiety levels more than not knowing what’s going on and having to chase information. Not only can it be a very frustrating and time wasting experience; navigating IVR’s, getting someone’s voice mail, being transferred and having to re-explain our story yet again, but we feel unappreciated and unimportant.

When a business identifies the touch points when its employees will communicate with the customer, they set themselves up to deliver a better and more consistent customer experience: employees know whose responsibility it is to communicate with the customer, what method or format they will use, what information they will provide, etc. Additionally, the plan needs to be documented. This will create visibility for others on the team and help promote accountability. Too many organizations operate like a peewee hockey team, where everyone chases the puck. At the professional level though, they have a plan; everyone knows their position, the role they play and the value they can bring to the team.

The key is for the business to create a work plan that makes it clear to employees the details of what will be done; much like a professional hockey team. From a customer’s standpoint, it’s seamless. They are contacted before they begin to wonder what’s going on, in a format and with the content that makes it easy for them. Of course, customers also expect to be contacted because they’ve been told they would be. When a business follows this protocol, there are fewer surprises and customers feel more involved in the process. They are treated in a way that conveys they matter and their interests are being looked after. Customers will grow to trust you because they can depend on you to do what you said you would do. A nice by-product of setting employees up to be successful is greater employee engagement – and lower costs associated with low morale and employee turnover.

Step four – Use the right metrics to drive your decisions

To correctly align employee behavior with your organizations goals, you need to use the right ‘KPI’s’ (key performance indicators). Unless you measure what’s important for your organization, how will you know how well you’re doing or where to focus your improvement efforts. Moreover, which KPI’s are appropriate will evolve, just as our circumstances evolve. If you’re using the same KPI’s to measure your organizations performance you used five years ago, it’s probably time to take a good look and determine whether or not they still make sense for you.

The development of a strategic plan is your foundation. It details the metrics that are important: how they will be captured and validated, how often, by whom and how they will be communicated. The strategic plan aligns the day to day work being performed with the organizations goals.  If for example, customer loyalty is a primary goal for the organization, how are you evaluating whether or not your processes and systems are aligned with and support the activities that drive customer loyalty?

The KPI’s measure the effectiveness of the strategic plans execution. A note of caution however, don’t fall into the trap of implementing too many measures or you’ll confuse people and dilute the message of what’s really important. Your goal is to measure how effectively you’re providing value to your stakeholders and the degree to which you can do it profitably.

Generating profitable customer loyalty doesn’t happen overnight, nor does it happen without hard work. But with a thoughtful and well executed plan, it is achievable. The key will be ensuring your infrastructure is in place to drive the right behaviors through engaged and empowered employees. This will help ensure it is carried out in a way that drives value to your customers. You’ll know you’re on the right track when your customers don’t view the credit manager as an adversary. 

How to build your moat: A roadmap to creating a competitive advantage

 

With competition between organizations becoming ever more sophisticated, it is imperative for those aspiring to greatness to build a brand that differentiates the organization from the competition or risk either commoditization or worse, extinction.  

For too many, when asked what it is they sell, this question will unfortunately lead to a list or description of the products or services their organization provides. The reality is that your customers can get similar products or services from any number of other suppliers. When we reduce what we sell to merely being products or services, we reduce our selves to offering little more than a commodity; and as a commodity you will compete largely based on price.

Competing on price is a losing proposition. There will always be a competitor who will supply a similar product or service for less; perhaps they are willing to accept a reduced margin or they want to gain market share, but there will always be someone willing to do it for less.

Warren Buffet once said, the one thing every great organization does is build a moat around themselves. They create a barrier that protects them from their competitors by differentiating themselves from their competitors. They do this by building a brand that sets them apart. The most effective way to accomplish this is to understand what your customers are really buying from you and ensure your organization provides it every time, without fail. Your customers will be able to depend on you to do what you say you will do – every time.

​In order to achieve a level of consistency that your customers will come to depend upon, and recommend you for, an organization must install processes that are robust enough and have the management capital (leadership’s time, budget and enthusiasm) to ensure continuous improvement becomes part of the culture. This is not easy work. For most organizations, it necessitates a cultural transformation that transcends every level of the organization and engages employees in the execution of this critical work. But the return on this commitment far exceeds the investment: capable and engaged employees will ultimately delight your customers. Customers, who will buy more, cost less to serve, be less price sensitive and will serve as ambassadors for your organization…an organization that successfully differentiates itself from its competitors.  

Good intentions alone do not constitute a plan of action. Sustainable improvement in the employee - customer interaction requires disciplined local action coupled with a company wide commitment to changing how employees are recruited, positioned in roles, rewarded and recognized, and importantly, how they are managed.

The challenge for any organization, regardless of their products or services, is to create an environment where employees are engaged in the work they do and feel compelled to take ownership of each transaction by doing what they believe to be right for the customer. When an organization has a culture that fosters empowerment, they instill pride in their workforce, reduce turnover and generate customer loyalty….and that will be their moat.