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Coherence

Posted on by Nathan Schock in communication

Rick was kind enough to send me a copy of his excellent book, Coherence, at a time that we were exploring a partnership. Coherence is such a rich way to think about marketing and Rick employs the word masterfully. In a world of so much formulaic communication, Rick issues a clarion call to the truth that comes through coherence.

Anyone in higher education should read this book, but anyone outside education (like me) can still benefit. My favorite section was the three Satellites that any organization can use to build a coherent communication plan. I recognized much that I have already incorporated in our approach to defining the culture of the organizations we work with and picked up a couple of new tips.

This updated edition was written early in the COVID-19 pandemic and has some useful thoughts for how Rick’s constituents can respond. Now that we’re nearly a year into the pandemic, it’s easy to see that he was right: there will be no return to normal. And in the new normal, one expects that Coherence will be even more important.

Don’t let your vision get blurry

Posted on by Nathan Schock in culture

Culture.

Think about that word for a moment. We put a lot of stock in that word, from world politics to your back door.

Yet, it’s unspecific. When it comes to your culture — that collection of relationships and policies and rules and habits and norms that are your business — we need more guidance.

What is your culture and how do you define it?

At FiveFour, we think it starts with a basic idea. What is your vision? What is that big idea that defines who you are and who you hope to be? If you can’t express a vision in a concise phrase, how can you expect your employees to understand it?

That’s just one of the aspects of your business we’ll explore in our Experience Gap Analysis, which you can take here.

We find that as companies grow, the early passion and vision of the founders frequently gets blurred. It’s no longer being communicated to the teammates on the front lines. Communication is filtered through layers of management. The byproduct is often disengaged employees, disgruntled customers and stalled growth.

Culture is where we started with A&B Business Solutions, an equipment, service and supply company that has grown to 120 employees spread over 15 locations in five midwestern states. They wanted to improve employee engagement and customer loyalty.

FiveFour was the ideal partner to achieve those goals, says Amanda Odegaard, the company’s vice president of operations and human resources.

“FiveFour’s partnership in defining our culture and communicating our message throughout the organization was superb. It is refreshing to see the results with clear expectations in how we work together and with our customers.”

Improving communication has improved the employee connection to the vision and goals of A&B Business.

“The shift of the attitude of the people internally, I would say has been the biggest change,” says Odegaard. “With that change in attitude there are more positive conversations happening. That’s the biggest transformation that has occurred and that’s across the company not just in small groups.”

The great companies in our world have great vision statements.

Apple: Make a dent in the universe.

Coca Cola: Refresh the world.

Instagram: Capture and Share the World’s Moments.

It’s tempting to say, they’re just a few words. But it’s the intention behind them, the drive and the desire that make them great. They are guiding statements that transcend goals and quarterly reports and keep purpose in focus.

And this is important: They are succinct. You can remember them.

Our vision at FiveFour is, “The Battle for Better Business.”

We live it every day. Because business is a battle. Somebody is always trying to tempt your customers and cut your market share. To win the battle, you must have great troops. These are the people who will go into that battle with you every day and give their best.

That’s a culture of success.

Which brings us back to the word again – the amorphous culture.

Maybe this is true, it’s up to you to define it. We helped A&B Business and we would love to see if we can help you. The first step is to take our assessment and find out.

Note: this is the second of five posts talking about what we do at FiveFour. You can read the first one here. Stay tuned for the other three.

What is FiveFour?

Posted on by Nathan Schock in customer experience

One of the most frequent questions I get about my new(ish) company, FiveFour is: What is FiveFour? We’re launching a new email series to answer that question, so I thought I would share it here.

FiveFour specializes in transforming businesses.

Which raises the obvious next question: “What kind of transformation are we talking about?”

Let me explain:

We help successful companies that have seen their growth start to stall or not go as fast as they would like it to. Companies who have started to see a few more disengaged employees and disgruntled customers than they are comfortable with. You know, those problems they didn’t have to worry about when the were small, and the leader wasn’t far removed from every team meeting and every customer interaction.

But you can’t just go back to the way you were doing things before. You’re a different business now and you need to create remarkable experiences for the team and the customers you have today. You need to transform your team and customer experience. That is the transformation we’re talking about.

Business today is far more than just its products and services. Increasingly, successful companies understand that their customers are looking for more than things. People value connection and personalization. We want to spend our time – and our money – on experiences, not things.

The businesses that figure this out are the ones we recommend to our family and friends. The ones we return to again and again.

Isn’t that what you want for your business? The unmatchable value of raving fans.

It isn’t easy or simple.

At FiveFour, that’s what we do.

We guide companies as they transform their culture into one committed to customer success. We get your team re-engaged so that they better engage with your customers. We get you back to growing again.

If you want to learn how your business can transform into an organization focused on customer success, sign up for our email list to ensure you don’t miss any of our important communications.

What we’re talking about takes reflection, assessment, adjustment and commitment, but only if you want to drive measurable results.

Think of us as the guides along your journey of business transformation.

P.S.: Get fresh perspective on your business with our Experience Gap Analysis. This deep dive into your employee and customer experience includes a 45-minute presentation of opportunities from one of our transformational guides. This service is normally $1,000 but are making it available to you at no charge as an introduction to FiveFour.

P.S.S: You’re probably wondering about our company name. In antiquity, the Quinquatrus (or “FiveFour”) was a celebration of the Spring Equinox – of new life and the birth of a new season of growth. The five-day celebration began with one day of festival, followed by four days of gladiator battle in the arena. This model – one-part preparation, four parts hard work – is the guiding idea behind FiveFour. We are the one day of preparation – getting you ready for the “hard work” that awaits you in the business arena.

Asking (and answering) the Ultimate Question

Posted on by Nathan Schock in Uncategorized

In the Ultimate Question, Fred Reichheld tells the story of Intuit, describing a problem that FiveFour regularly helps businesses solve. Co-founder Scott Cook had built a successful company on the mission “To make the customer feel so good about the product they’ll go and tell five friends to buy it.”

When the company was in the start-up phase, the employees learned how to fulfill that mission by observing Cook’s passion for taking care of the customer. “They could all hear him working the service phones himself, talking to customers. They could see him taking part in Intuit’s famous “follow-me-home” program, where employees asked customers if they could watch them set up the software in order to note any problems.”

But growth in the number of employees and locations made learning by following the leader impossible and “Cook was hearing more complaints [from customers] than in the past. Some market-share numbers were slipping. For lack of a good system of measurement and for the lack of the accountability that accurate measurement creates – the company seemed to be losing sight of exactly what had made it great: its relationships with its customers.”

To solve the problem, Cook started measuring customer loyalty through our favorite measurement tool: the Net Promoter Score (NPS), which asks the Ultimate Question: “How likely is it that you would recommend Company X to a friend or colleague?” Respondents score their likelihood on a scale from 1-10, with those answering 9-10 classified as promoters, 7 or 8 passives and 6 or less detractors. Your NPS is calculated by subtracting the percentage of detractors from your percentage of supporters. A positive number means you have more supporters than detractors.

While measurement is an important first step, measurement alone won’t solve the problem that Cook faced at Intuit. The challenge that leaders of growing companies face is how to scale the culture and customer experience that led to the growth to begin with.

That’s what FiveFour calls the battle for better business. We help companies capture that original vision for their culture and how the customer is cared for. But the next step is maybe the most important and what really differentiates FiveFour: we create a customized, ongoing system of learning and development that, over time, transforms the business through increased employee engagement and continuous learning.

Do you resonate with that description of Intuit? Are you noticing more customer complaints and employee disengagement? Take our assessment of your customer experience and we’ll give you some tips you can use to improve your employee and customer experience.

Want to get started measuring your NPS and eNPS (Employee Net Promoter Score)? Just email me and I will give you access to our free, online course showing you how to implement both.

Intuit was profitable and growing at the time they addressed these flaws in their employee and customer experience. But they saw that those flaws were starting to impact their growth. What happened after they addressed them? They now have an NPS of 45 and a market cap of $82 billion, which isn’t bad.

Paying attention pays off by creating raving fans

Posted on by Nathan Schock in Uncategorized

(This is one of our weekly FiveFour emails. Sign up to receive these here).

I heard a story recently that’s a real-life demonstration of the principles we follow at FiveFour.

It’s a coffee story, which got me interested right away.

Mmmmmm, coffee.

Susie Patrick owns the Breadsmith stores in Sioux Falls.

Mmmmmm, bread.

And while Susie runs a fine operation in her own right, this isn’t a story about her, though she is a prime character.

Susie stops at the Scooters Coffee at 33rd Street and Minnesota Ave. every morning for a latte. Recently, she ordered two, hers and one for an employee.

Wouldn’t you know it, the espresso machine was down. The staff at Scooters offered a cold drink but hot espresso wasn’t going to happen for another 20 minutes or so.

Susie, though appreciative, declined any substitute.

Inside the small shop, Travis Rhoades was working diligently to get the espresso flowing. Travis isn’t just a repairman, he’s also the franchise owner of the nine — soon to be ten — Scooters locations in the Sioux Falls area.

The Scooters staff noted the customer didn’t order anything else.

Travis asked if they knew the customer’s name. They did not.

“It’s the Breadsmith Lady,” one employee said. “She gets a latte every day.”

That was a signal to Travis. As the owner, he’s been able to grow his business due to a commitment to his customers. He trains staff to observe customer behaviors in order to pick up on small cues.

“It’s how to engage in a meaningful conversation in 30 seconds,” he says.

Even in the drive-up.

Window stickers, hats, sports bags in the seat – they are all openings for conversation that can lead to actionable information.

It might be a quick “Go Vikings” written on the side of the coffee cup.

It might be remembering their kids play on a traveling soccer team and they are always trying to get out of town.

It might be that lady who works at Breadsmith. Or, as it turns out, owns them.

Travis noticed the opportunity, not just to shore up a customer relationship, but to model that behavior for the team.

So, once the espresso machine was back up and working, he whipped up a couple lattes and drove down 33rd Street to the Breadsmith store with a special delivery.

He still didn’t know her name until we connected the dots and told him.

“I just know her as the Breadsmith Lady,” he says.

Susie was thrilled to get the delivery and to learn she’s got a nickname.

“It’s a testament to his crew that he recognized me and my drink,” Susie says. “It’s customer service you don’t normally see anymore. I hope that people refer to our service at Breadsmith the way I was treated.”

You can find different customer experience touchpoints in this story. But the one that struck immediately is Surprise.

Yes, it was surprise for Susie to get lattes delivered. But that’s not the lesson.

What’s important to focus on is the culture, the intentional strategies that Scooters reinforces. They pay attention to customers as individuals, so that they can personalize the experience.

Travis says he’s always looking for opportunities to reward and demonstrate the customer-centric behavior. They are intentional about who they hire. And he preaches common sense over policies and procedure.

“It’s not the Breadsmith Lady’s fault that our machine is down.”

It would have been easy to write it off as just another face in another car in a stream of cars every morning.

That’s not what they did.

Because what goes better together than coffee and bread in the morning?

Passing the $10 million plateau

Posted on by Nathan Schock in customer experience

Ready, Fire, Aim started as a retreat serial entrepreneur Michael Masterson led for other entrepreneurs. He wanted to impart the lessons he had learned from a 30-year career starting and running several multi-million-dollar businesses. Later developed and expanded as a book, the subtitle states his objective; teaching the reader to take a business from “Zero to $100 Million in No Time Flat.”

The two biggest ideas in the book are the importance of action (thus, the book title) and that going from zero to $100 million encompasses four distinct stages in the life of a company. Having read the Five Second Rule, 10X, and many other books, I knew the first point well. It’s the second that I will focus on.

According to Masterson, each of the four stages of a business has different problems, challenges, and opportunities and requires different skills from the entrepreneur running the company. The stages are:

  1. Infancy ($0-1 million in revenue)
  2. Childhood ($1-10 million)
  3. Adolescence ($10 million to $50 million)
  4. Adulthood ($50 million to $100 million and beyond)

The stage that was the most interesting to me (because it faces many of the challenges my company, FiveFour, solves for business leaders at this level) is adolescence. Once a company grows to or near $10 million, the growth almost always comes with a new set of challenges.

At this size, there is at least one or two levels of management between the founder/CEO and the front-line workers who engage with the company’s customers. Those employees do not have the benefit that existed in the first two phases of business growth – proximity to the founder/CEO. Companies that reach $10 million in revenue usually do so because the founder/CEO built a culture around taking care of the customer. With multiple levels of management, they no longer talk directly to every employee and are unable to directly impart their culture and expectations of how the customer should be cared for.

The way this usually shows up in a company is through disgruntled customers. Masterson writes: “The most important disconnect has to do with the priority you had established to make sure every customer would be handled with the utmost of care and consideration.” The business is in need of a transformation. A transformation from focusing almost exclusively on customer acquisition to one that now focuses equally on customer retention. Masterson calls it customer service, but were he writing today rather than the mid-2000’s, he would likely recognize that the customer experience is even more important.

The leader accomplishes this transformation by a focus on operations and training, communicating the vision, joint ventures and hiring stars and superstars. He’s dead-on with that list, but a few of his methods are decidedly lacking. For example, to communicate the vision he advocates writing a monthly memo. To solve this communication gap that he has so accurately identified takes much more than a written letter once a month.

And it’s behind that small defect that my larger problem with the book arises. Those memos worked for him and a client of his. That’s 98% of what you get in this book: his personal experience as an entrepreneur. Masterson has no time for theory. The only time I can remember him quoting an organizational theorist was to disagree with him.

That’s not a debilitating problem and it doesn’t erase the good that comes from the book. After all, Masterson wrote it to impart what he learned from his entrepreneurial journey. But it is a limitation that the reader should be aware of. This book is just one source – a good one, but just one – and will need to be supplemented with other resources especially the further we get from the day it was written.

What I read in May

Posted on by Nathan Schock in Uncategorized

My reading slowed a bit in May as I hired a business coach to help me with some changes in the business. It’s something I hope to write more about at a future time, but it required a lot of my time and attention, so reading decreased a bit. But learning did not. I was learning by reading a lot of their resources, working through video-based training and interacting with my coach on weekly calls.

Still, there was time for reading. Here are the highlights of what I finished in May, 2020:

Who – The A Method for Hiring

Most business leaders and entrepreneurs have run across the famous concept popularized by Jim Collins in his seminal book, Good to Great: “First who, then what.” The idea is that those who build great organizations focus first on getting the right people on the bus and in the right seats before they figure out where they’re driving the bus. But most don’t know how to do this. They follow what Geoff Smart calls some method “of voodoo hiring” like scanning a resume, conducting a short interview, calling a couple of references and going with a gut instinct. Smart instead gives a system for hiring that involves a scorecard rather than job description and a series of interviews designed to determine if the candidate is a fit for the mission, has the competencies to do the job and can achieve the agreed upon objectives. The ultimate goal is to hire A Players – to get the who decisions right. I’ve started implementing some of these concepts in my business and, if you don’t have a hiring system, you should, too.

VC – An American History

One of my businesses is owned by a private equity company, which is not exactly the same as venture capital, but in the same vein. So I was interested in this history of venture capital in America. It started long before California became a state and has been tied to the entrepreneurial story of America since its founding. Wherever there has been the promise of out-sized returns at great risk, financial intermediaries (venture capitalists) have arisen to mitigate that risk. It started with whaling industry and was made famous by the Silicon Valley firms that invested in the tech giants Amazon, Apple, Google, Facebook, Uber, etc. etc. In between those two points in history is a fascinating story where the industry was kept alive first by wealthy families, military investment and universities. I was especially interested in his take on where the industry goes in the future. Nicholas mentions the innovative approach of Andreessen Horowitz to offer its portfolio companies a slate of services (HR, marketing, etc.) in addition to investment. Nicholas sees that as a sign of the industry returning to a long-term focus of building companies for public markets rather than short-term returns. Time will tell if that approach wins out, but what’s not debatable is that venture capital will continue to be part of America’s story.

Free Prize Inside!

The only way to win in business is to become remarkable. That was the message of Purple Cow. But how do you make a purple cow? That’s what this short book is about. In fact, that’s what the subtitle says. According to Seth Godin, he had to write this follow-up because business was all wrong in how they were going about their search for a purple cow. They were seeking the big. Big innovations. Big marketing campaigns. But a Purple Cow is much more likely to be a small, soft innovation that customers love – a Free Prize inside their offering. Writes Godin, “Most free prizes have two essential elements in common. First, they are the thing about your service, your product or your organization that’s worth remarking on. Something worth seeking out and buying…Second, most free prizes are not about what the person needs. Instead, they satisfy our wants. They are fashionable or fun or surprising or delightful or sad. They rarely deliver more of what we were buying in the first place.”

One of the most obvious free prizes is customer experience. It’s not more of the product or service. It’s something unexpected during the delivery of the product or service. Something that’s worth remarking on. And late in the book, Godin gives a fitting example. He tells the story of his interaction with Jose who worked in a taco shop in the Denver airport. What was remarkable about this interaction? Jose chatted with Godin for an extra minute while he ordered, got him a special condiment from the back. Later, he asked Godin how his meal was. In other words, Godin had a great experience with Jose. And as he points out, the cost of that experience was zero, but the value to Godin was “enormous.” Your customer experience can be a free prize for your guests. It can cost you nothing while delivering enormous value.

The Five Dysfunctions of a Team

Great teamwork is the exception and that exception almost always means that a team has overcome five specific things that cause all teams to misfire. Patrick Lencioni has identified those five dysfunctions in this fantastic little book. I’m a huge fan of Lencioni. The first two-thirds of almost all of his books are a fictional account that makes his point followed by a non-fictional explanation of that point. I’d read the non-fictional third of this book many times, but never the fable that comes before it. I think both are his best work. Here’s a quick listing of the five dysfunctions (as I plan to write more about this book later):

  1. Absence of Trust: The fear of vulnerability prevents the building of trust within the team.
  2. Fear of Conflict: The desire to preserve artificial harmony stifles the occurrence of productive conflict.
  3. Lack of Commitment: The lack of clarity or buy-in prevents making decisions the team will stick to.
  4. Avoidance of Accountability: The need to avoid discomfort prevents team members from holding one another accountable.
  5. Inattention to Results: The pursuit of individual goals and personal status erodes the focus on collective success.

I recently listened to Overcoming the Five Dysfunctions of a Team, which Lencioni calls the field guide for implementing this book. I can’t recommend both highly enough to anyone managing a team.

More

I read The Vision-Driven Leader by Michael Hyatt, which would be a great book for someone looking to establish an organizational vision for the first time. Also read Visioneering by Andy Stanley, which I blogged about here.

What should I read next? Leave a comment below if you have a recommendation.

Customer experience – the Free Prize Inside!

Posted on by Nathan Schock in customer experience

Seth Godin has been one of the most influential authors in my career. When I started working in an ad agency in the early 2000s, I came across Permission Marketing and it completely changed my opinion of what a marketer could be. I re-read it just a couple of years ago and was amazed at how relevant it still was.

For people who want to learn how to become more valuable in the modern workforce, I regularly recommend Linchpin. But perhaps Godin’s most famous book is Purple Cow: Transform Your Business by Being Remarkable. The message of Purple Cow is that the only way to win in business is to become remarkable. But how do you make a purple cow? That’s what the short book, Free Prize Inside! is about.

According to Seth Godin, he had to write this follow-up because business was all wrong in how they were going about their search for a purple cow. They were seeking the big. Big innovations. Big marketing campaigns. But a purple cow is much more likely to be a small, soft innovation that customers love – a Free Prize inside their offering. Writes Godin, “Most free prizes have two essential elements in common. First, they are the thing about your service, your product or your organization that’s worth remarking on. Something worth seeking out and buying…Second, most free prizes are not about what the person needs. Instead, they satisfy our wants. They are fashionable or fun or surprising or delightful or sad. They rarely deliver more of what we were buying in the first place.”

As I was reading this, it became obvious that one of the most obvious free prizes is a great customer experience. It’s not more of the product or service. It’s something unexpected during the delivery of the product or service. Something that’s worth remarking on. And late in the book, Godin gives a fitting example. He tells the story of his interaction with Jose who worked in a taco shop in the Denver airport. What was remarkable about this interaction? Jose chatted with Godin for an extra minute while he ordered, got him a special condiment from the back. Later, he asked Godin how his meal was. In other words, Godin had a great experience with Jose. And as he points out, the cost of that experience was zero, but the value to Godin was “enormous.”

Your customer experience can be a free prize for your guests. It can cost you nothing while delivering enormous value.

Staying calm is a choice

Posted on by Nathan Schock in leadership

In business lots of things can get us worked up – even when we’re not in the midst of a pandemic quarantine. We frequently don’t get to choose our circumstances – but we always get to choose how we respond to those circumstances.

Me, trying to stay calm

That’s what was going through my head yesterday as I was transferring four frames of honey bees from two nucs to two, ten-frame hives. Why?

As bee keeping experts will tell you, bees pick up on your stress, so it’s important to remain calm while you’re working with them. That’s what I was telling myself as I peeled back the lid to the first nuc and exposed thousands of bees.

And it was easy to remain calm while they sat on the frames in the nuc. But the calm didn’t last long. Once I started removing the frames, those previously calm bees started swarming and buzzing around my head. And if you’ve never experienced that before, I promise you that my first instinct was not one of calm.

Here’s the thing, I had to continually remind myself to stay calm. The first frame won’t easily slide out? Stay calm. The top box is heavier than I remembered and I almost drop it? Stay calm.

I think business is the same way. We know that finding order in chaos is an important attribute of leadership today, according to Justin Menkes in his fantastic book, Better Under Pressure. But it’s usually not our natural response when things don’t go according to plan. That’s okay. Just remind yourself that this is a normal response – but it’s also one that you can change.

What happens if you don’t remain calm? When you’re working with bees, they get stressed and start attacking. And then you get more stressed and the negative feedback loop continues. In business, it’s the same way. It’s often not the negative event that kills a business. It’s our negative response to that event that does it. By responding in a state of stress, we just make the situation worse.

So, how do you stay calm? By constantly reminding yourself. It’s that easy and that hard. You must choose calm, especially when everything swarming around you is pushing you in the opposite direction.

What you do won’t do it

Posted on by Nathan Schock in customer experience

My friend Shareef Mahdavi just released a new book, Beyond Bedside Manner: Insights on Perfecting the Patient Experience. To be precise, the book has 57 insights and any one of them could transform a medical clinic all by itself. If you work in healthcare, you must read this.

One of my favorite insights is Defining Excellence, where Shareef is making the excellent point that what you do as a doctor can’t be a point of differentiation. That’s expected. Here’s the excerpt:

Your outcomes are expected in the same manner that your expertise is assumed (like that of the airplane pilot). While this can be difficult to reckon with for surgeons who have dedicated their career to excellent outcomes, technological innovation in medicine has begun to level the playing field when it comes to outcomes. Software-driven diagnostics as well as surgical tools are designed to reduce surgical variability, meaning there’s usually another doctor out there in your community who can promise similar results to yours.

If you’ve been able to distinguish your practice based on surgical results, that’s great. But as excellent outcomes are expected to begin with, this competitive advantage will only dissipate with time. Unfortunately, outcomes are gradually becoming a hygiene factor, a marketing term describing an element that is noticed only if it’s missing or something goes wrong.

I see this same sentiment in almost every industry we deal with. They will say (or at least think): “Sure, customer experience is important for coffee shops, hotels, restaurants, etc. But people come to me for the thing I do. Customer experience is nice, but what people want from me is a particular outcome.” No, the outcome is expected. The way your differentiate yourself is through the customer experience.

The medical community has been among the slowest to acknowledge this and the ones most in need of it. One of the best examples of this was the Propublica study of Yelp medical reviews a few years ago. Here’s the main takeaway:

Indeed, doctors and health professionals everywhere could learn a valuable lesson from the archives of Yelp: Your officious personality or brusque office staff can sink your reputation even if your professional skills are just fine.

In other words, your medical outcomes aren’t enough to generate a good online review, if the experience isn’t up to the patient’s expectation. This is what our training with Experience Economy authors Joe Pine & Jim Gilmore talks about:

A remarkable experience doesn’t come from what you do, but how you do what you do. Because what you do won’t do it any longer.

That’s just one of 57 insights that you’ll get from Shareef’s book. The other 56 are equally good and worth reading.