Northwestern University professor Homi Patel shares 10 tips on how to ensure success.
Homi Patel, professor of marketing at Northwestern University’s Kellogg School of Management, was a featured speaker at the peer group gathering Next Level University last November. (For more on that event, see “Raising the Bar” in our January issue.)
Speaking to leaders and staff from six notable landscaping companies Patel, retired chairman and CEO of Hartmarx Corp., shared his views on managing employees and pleasing customers. In the process, he gave those in attendance much to think about.
Patel emphasized there are 10 things a company in the service industry must get right. Here they are, in his own words. Companies that follow this advice, Patel says, will benefit.
- Define your service offering. Every business needs to understand what they’re going to do well—and what they’re not going to do well.
This is not a casual choice. Instead, it is a choice that you perform badly at some things so that you can afford to excel at others. For example, if you are going to provide the very best service, you have to get comfortable with the fact that you cannot provide the best price. - Delight your customer by doing unexpected and surprising things. Everybody has good service, everybody has great service. But that’s just not enough. What you’ve got to do is delight your customer. Take Disney, for example. You stand 40 minutes for a two-minute ride and yet those kids come out thrilled. Try getting a kid that age to stand 40 minutes for anything. Disney figured out how to delight its customer.
- Be aware of your customers’ pain points. Don’t ignore the uncontrolled pain points, because that’s when you’re going to lose one of your customers. Know about divorces, deaths or whatever it is. Your clients need you at that particular time. Keep in regular contact. Empathize. Deliver new information without being a pest.
A lot of customers are lost, particularly in the service business, because businesspeople a). are not aware of the pain point that’s going to hit them, which is uncontrollable, and b). haven’t devised a plan to get close to the customer in that particular area. - Hire for attitude; train for aptitude. When it comes to recruiting and selecting talent, 100 percent of employers want the smartest, the best people. But the simple reality is, the people who have it all are expensive to employ. A competitive cost structure requires compromising on employees. Hire for attitude; train for aptitude. You need 100 percent of your employees to have a great attitude. You don’t need 100 percent of your employees to be A+ students.
- Know that employee sacrifice is not sustainable. You must recognize the difference between a stretched employee—which is good—and a stressed employee, which is not so good. Don’t expect that you’re going to do well in the long run by just constantly putting more and more pressure on your employees.
- Understand that training requires transforming the complex into the simple. It’s as simple as that. Make sure the training curve puts your to-do list on your employee’s to-do list. A good training program enables employees to exceed their own expectations. Cut out the boilerplate stuff so training creates energy rather than saps it.
- Reward employees. Remember, your employees are closest to the customer. Reward them for insights and information and use them in multiple ways. They know what kind of people really fit into the organization. Let them help you recruit talent, and reward them for it.
- Control personnel. Your largest cost is personnel. I don’t need to do a survey on that. We’ve already discussed hiring for attitude, training for aptitude, but there’s another big issue in employee cost, and that’s managers not making the tough call on personnel. An employee functioning below expectations is costing you money.
- Get rid of customer sludge. Everyone has them: those customers you don’t make money on. The customer who demands too much. Anybody who demands unprofitable levels of service, you have to have the guts to get rid of them, from a profitability point of view.
Next, make your customers do things for themselves to eliminate unnecessary costs. But give them a plus, as well. Take airport kiosks, for example. By creating these, airlines saved themselves money, but travelers benefit as well. You can check yourself in, you don’t have to deal with a surly attendant and you can walk right in through security. They created a win-win. - Finally, lead by example. You built this business. You are the leaders of this business. If you don’t have passion, energy, integrity and humility, you have no reason to expect your employees to have any.
