Posts Tagged ‘customer satisfaction’

94994429In Rapid Realignment, George Labovitz and Victor Rosansky chart the path to optimal organizational performance by integrating key processes, staff, customers, and strategies to serve the primary purpose of an enterprise—increasing stakeholder value. Alignment is the result of this integration, and organizations that achieve it succeed by focusing their people and resources on providing optimal customer satisfaction. In aligned organizations, employees at every level understand the business’s goals and strategies and know how their efforts advance them. Their clear understanding of customer needs enables the constant improvement of products and services that win and maintain customer loyalty. This adjustment, or rapid realignment, is a necessity in a global economy in which swiftly changing conditions and demands can pose serious challenges to an organization’s survival.

According to Labovitz and Rosansky:

  • To support an organization’s primary purpose, its staff, strategy, customers, and processes must be aligned. This alignment requires clear communication, complete understanding of its objectives, and the commitment of all involved in the process. When external forces or events cause misalignment and reduces effectiveness, rapid realignment is essential to ensure continued success.
  • The alignment framework is made up of four elements — strategy, people, processes, and customers. Strategies will change as requirements change, and when they do they must be rapidly deployed. Core processes that serve customers must continually undergo improvement.
  • Vertical alignment is achieved when employees can articulate the organization’s strategy and explain how their work supports it. This understanding is what boosts the deployment of new strategies.
  • Horizontal alignment is achieved when the communication barriers that separate employees from customers are removed. This means that employees understand customer needs and are committed to improving service.
  • Every organization must have a Main Thing — a meaningful description of what it wants to accomplish. It must be a common and unifying concept to which every unit can make a contribution.
  • Social media is an excellent means for fostering trust and bringing people together to advance both the Main Thing and management’s plans for achieving it. It facilitates employee communication with management and enables employees to ask questions that get answers.
  • To effectively change their cultures, organizations must determine the behaviors that will best implement their strategies and meet customer needs, as well as ensure that attitudes and values are aligned with their Main Things.
  • To effectively change behaviors, new strategies must be explained repeatedly. Employees must be able to comprehend how their participation will ensure the strategies’ success and how their contributions will be valued.

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Related book summaries in the BBS library: Wiki ManagementHBR Guide to Getting the Right Work DoneBusiness at the Speed of Now

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After hiking the price of their joint DVD mailing and instant streaming service without any knowledge from their customers, Netflix recently announced that it will be splitting into two separate companies. It will continue to offer its internet streaming service under its original name and logo. As of last week, it has decided to offer its original service, DVDs through the mail, under a new name and company, “Qwikster.”

I recently received the following stock e-mail from Netflix co-founder and CEO, Reed Hastings: “It is clear from the feedback over the past two months that many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming and the price changes. That was certainly not our intent, and I offer my sincere apology. Let me explain what we are doing. It’s hard to write this after over 10 years of mailing DVDs with pride, but we think it is necessary: In a few weeks, we will rename our DVD by mail service to “Qwikster”. We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming.”

I myself have been a devoted Netflix member for over 4 years. I was thoroughly excited at the prospect of their instant streaming service, and their ability to continue their great customer relations and low prices. Unfortunately, I do feel that the recent chain of events and consistent lack of dialogue with their customers has shown little respect for the immense member base that has led to their tremendous success. I only learned of their sudden price increase due to my credit card bill showing that my Netflix charge had almost doubled. Moreover, there was no response to this price increase for almost an entire month.

The mass generated e-mail is a gesture in the right direction, I suppose. Netflix’s actions have gone against even the most basic rule of customer relations: the customer comes first. I wonder now how important customers truly are to the company’s overall vision, and how many the past few months of conduct will cost them.

What do you think about Netflix’s recent split?

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C. Britt Beemer and Robert L. Shook’s The Customer Rules presents the argument that the world’s most successful companies are those with an unwavering commitment to customer satisfaction. According to a study conducted by America’s Research Group (ARG), 40 percent of employees feel their job has little or nothing to do with a customer. Successful companies, however, make it clear that customer satisfaction is everyone’s job. One way to do this is to make customer satisfaction part of all employees’ job description. Unless the concept is clearly spelled out, most employees will assume that serving the customer is the job of sales and marketing.

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