Excerpts from, "I Love You More Than My Dog": Five Decisions That Drive Extreme Customer Loyalty in Good Times and Bad

by Jeanne Bliss

 

 

CHAPTER 2 - Decide to BELIEVE

Show me the person you honor, for I know better by that the kind of person you are.

For you show me what your idea of humanity is.

—THOMAS CARLYLE

Griffin Hospital Decided to Open Up Its Medical Records to Patients.

DECISION INTENT: Honor Patients’ Right to Their Information.

Griffin Hospital wanted to have no secrets between themselves and their patient “customers.” The traditional approach of doctors or medical professionals delivering only select information often left patients and family members feeling that they were not in control. It put the customer out of power and the medical professional in power. Griffin wanted to balance out that lopsided relationship. They wanted to create a hospital/patient/ family partnership. So they decided to make medical records available to patients and their families.

MOTIVATION: Mend Years of Imbalanced Healthcare Relationships.

Through their gesture of making records available to patients, Griffin showed that managing the journey to health was an equal partnership between themselves and patients and their families. They wanted to mend years of a perceived imbalanced relationship, so Griffin made the total transparency of patient medical records an olive branch. Anything the hospital knew, the patient and family could know. In doing so, Griffin Hospital patients could spend all the time they wanted with their records, have them explained, and consider them their “own.” They could even make comments on their own charts.

IMPACT: Partnership and Trust Replaced Fear and Suspicion. Malpractice Suits Declined.

Worried doctors feared that patients armed with this information would fuel an increase in lawsuits. The total opposite occurred: this decision reduced malpractice claims. Patients and families fell into partnership with the medical staff. After Griffin Hospital granted patients and their families access to their medical records, malpractice claims against the hospital dropped by more than 43 percent—from 32 percent in 1996, before the policy was enacted, to 18 percent in 2005. It’s noteworthy to add that this reduction in claims dropped during a period of great growth for Griffin Hospital. Patient discharges rose 40 percent during that period, an increase that usually carries an increase in claims. This decision stopped that cycle. Trusting patients with their own records grew patient belief in Griffin Hospital, and ultimately contributed to its growth. Griffin earned an 80 percent referral rate from customers who participated in this new decision. Surely there’s a simple gesture you can make to show customers you trust them, that you believe that trust is reciprocated.

W.L. Gore Decided to Cover Their Customers’ Backsides, but Not Their Own.

DECISION INTENT: Inspire Self-Motivation, Not Mandated Performance.

A garment made with W.L. Gore products is probably hanging in your closet somewhere at your home. It’s nearly impossible to buy a ski jacket or slicker without seeing the “GORE-TEX” tag hanging from the garment. But W.L. Gore’s reach extends far beyond what most of us know, to dental floss, guitar strings, surgical products, and many other categories. Revered for its ability to innovate, W.L. Gore has been named “pound for pound, the most innovative company in America” by Fast Company. What lies behind this ability is what founder Bill Gore decided to focus on as he began the business: how people inside the company come to make decisions among themselves. Deciding how to decide has driven the growth, ingenuity, and continued innovation at W.L. Gore.

DECISION MOTIVATION: Sustain a Culture of Innovation for the Long Run.

W.L. Gore’s ability to drive a culture of continuous innovation rests with its ability to reject traditional hierarchical convention, titles, and rank in its decision making. The company focuses instead on a democratic process in which decisions stick. Founder Bill Gore wanted a company where employees’ spirit grew by what they accomplished, not by which corporate scrimmage they had won—where more time was spent generating ideas rather than generating ways to cover one’s backside. So he decided to create a “non-organization” approach for his new company that would inspire creativity in its employees. He envisioned a “lattice” structure where people would work interconnectedly with one another rather than through a hierarchy. Gore wanted “leaders” to emerge through the ideas they presented and the commitment received to put ideas into action. “Power” is about ideas and the ability to get them sold.

IMPACT: Sustained Culture, Growth, and Spirit of W.L. Gore Associates.

This radical idea for a culture sticks because Bill Gore’s idea honors and upholds the human spirit of the people inside the company. At W.L. Gore, the belief is that people will step up and deliver when they are not regulated. Through a democratic decision and innovation culture, W.L. Gore has grown to a $2.4 billion company. They are one of only five companies that have been on Fortune magazine’s “Best Companies to Work For” list for twenty-five years, since it was initiated. Do you practice democratic decision making? What energy and innovation could you unleash with democratic decision making?

Wegmans Food Markets Decided No Customer Is Allowed to Leave Unhappy.

DECISION INTENT: Free Employees to Do What’s Right for Customers.

Wegmans Food Markets is a privately held grocery store chain with 37,000 employees. The company generated an estimated $4.5 billion in revenue in 2007. What fuels Wegmans’s growth are passion, training, and trust. In traditional retailing, customer experiences can become stilted when the frontline staff has a list of “do’s” and “don’ts” regarding how far they can go to serve their customers. Wegmans wanted to eliminate the behind-the-scenes rules and the required permission from managers usually necessary in retail. So the company decided to let employees make their own decisions no matter what customer situation they encounter. At Wegmans there is no rule book. There is simply this: no customer is allowed to leave unhappy.

MOTIVATION: A Trained, Trusted Employee Will Do the Right Thing.

CEO Danny Wegman believes in giving employees extensive training and experience to garner an understanding of the product and service experiences they are trusted to deliver. Wegmans invests over 40 hours per year on training to back up people’s natural instincts to do the right thing with the necessary skills to help them take action. This allows Wegmans to free themselves of management oversight. Instead, they simply trust in the decision making of the people on the floor working with customers. That could mean deciding to give away a birthday cake to a customer whose order was accidentally misscheduled. Or cooking a turkey for a frazzled hostess who bought a turkey too large for her oven.

IMPACT: Annual Employee Turnover Is 7 Percent; Average for Grocery Stores is 19 Percent.

By giving staff control over their own decisions and believing in them, Wegmans can deliver what Danny Wegman calls “telepathic levels of service.” This makes employees want to stay. The low turnover of 7 percent versus 19 percent for comparably-sized grocery store chains enables Wegmans to redirect the money it would have spent on constant recruiting to the constant development of their folks. And with that, profitability has followed. Wegmans’s operating margins are estimated at 7.5 percent—double that of its competitors. And its sales per square foot are 50 percent higher than the industry average. By throwing away the rule book, Wegmans prospers both financially and in the spirit of the people who work in its stores. Whether they’re putting away cans of garbanzo beans or sweeping the floor, everyone there knows that their decisions with customers stick. What portion of your rule book can you throw away?

What Do Customers and Employees Say About Your Ability to Believe?

BELIEVING, the act of honoring and trusting is a unique and special characteristic that sets beloved companies apart. It makes them human. And it bonds people to them.

Your decisions grounded in belief prove how much you honor customers and employees. They say how fearless you are in suspending cynicism. They indicate whether you nurture people and relationships to their full potential. What you decide to believe defines the spirit inside your organization. And it sets the tone for your interactions with customers. Search within your organization for these indicators of your ability to believe:

• How much trust exists in the front line to make decisions for customers?

• Are all the rules necessary?

• Is your selection process rigorous enough to allow you the freedom to trust the people you hire?

• Does your company have an intrinsic trusting relationship with customers?

Trusting your employees and customers goes beyond blind belief. Belief includes the selection and preparation of employees so they can do their best work. Belief includes building a reciprocal relationship of trust with customers, which may mean sharing information that would benefit customers even if it’s information you’ve feared to share in the past. It means setting up customers for success and prosperity. It means showing customers the rule book and getting rid of stupid rules that aren’t necessary in a relationship based on belief. The story of the companies who believe is about how great it feels to come in contact with them. And about how that sets the company and its people apart. Do you believe?

If you create an environment where the people truly participate, you don’t need control. They know what needs to be done and they do it. And the more that people will devote themselves to your cause on a voluntary basis, a willing basis, the fewer hierarchies and control mechanisms you need.

—Herb Kelleher, founder,
Southwest Airlines

CHAPTER 3 - Decide with CLARITY of PURPOSE

Many people have a wrong idea of what constitutes true happiness. It is not attained through self-gratification, but through fidelity to a worthy purpose.

—HELEN KELLER

What’s Your Story: How Clear Are You About Your Purpose?

Remember, the difference between beloved companies and others is that their clarity of purpose gives them a lens through which they make decisions that go beyond executing tasks to delivering points of contact that connect with their customers’ lives. It frees them to come up with an inspired set of actions. Clarity of purpose expands the definition of work from making drugs to saving lives, from selling homes to delivering the American Dream. Companies with clarity of purpose can turn task-oriented decisions into choices that lift them up and differentiate them.

Clarity of purpose is your compass. With clarity of purpose, the decisions of your company connect. Across the organization, people work beyond executing a set of tasks. When there is clarity, your customer can easily tell the story of your company because your actions connect, all guided by a unifying purpose. You will be defined by what you do—more important, by how you do it.

Are customers clear about what you deliver and why it’s different? Are your employees?

• If you ask ten people in your company what your purpose is, how many answers would you receive?

• Are customers telling your story?

• Are you selecting employees who are capable of delivering on your purpose?

• What steers decision making in one direction versus another?

CHAPTER 4 - Decide to BE REAL

I think that somehow, we learn who we really are and then live with that decision.

—ELEANOR ROOSEVELT

USAA Decided That New Hires Should Eat Like Soldiers.

DECISION INTENT: Understand Customers to Serve Their Lives. USAA (United Services Automobile Association) is a San Antonio company offering auto and home insurance to a customer base of military members and their families. While new hires are not required to be from the military, they must understand military life. So new USAA employees wear the military helmet and feel the weight of the backpack and flak vest as it is strapped to their backs. And they eat the same meals, the MREs—“meals ready to eat”—that soldiers eat in the field. They get to know the people behind the uniform by reading letters from soldiers and their families. As orientation ends, USAA’s intent has been realized. They have made their customers’ life a reality for their new recruits. And that sets the stage for how customers will be served.

MOTIVATION: Company Profitability Increases with Customer Growth.

USAA knows that an empathetic and caring workforce that understands the unique lives of their customer base is fundamental to their ongoing success and profitability. That means walking in their customers’ shoes, literally. USAA calls their approach to connecting employees’ lives with customers’ lives “surround sound.” Elizabeth D. Conklyn, USAA’s executive vice president of people services, says, “We want to cover the light moments, the heart-wrenching moments, what it’s like to be bored in the field.” The company takes that understanding beyond orientation. For example; USAA call center reps are called “troops” and use military time on the job. And they commit to ongoing training with military precision and follow-through. In 2007, USAA put 12,400 “member service representatives” through 250,000 total hours of classes to reinforce basic training.

IMPACT: USAA Retained 98 Percent of Their Customers in 2008.

By walking in the shoes of its customers, USAA breaks down the impersonal barrier that often exists between companies and customers. As a result, USAA customers love and reward them with growth and validation; 98 percent of USAA customers stayed with them in 2008. And they have achieved an 82 percent Net Promoter Score, meaning the majority of customers are passionate supporters. What is your version of receiving orders and wearing a flak jacket so you can re-create your customers’ lives during employee orientation? Beloved companies have their new hires (no matter what job they’re hired for) work in retail or in their warehouses or wherever the customers are at so they can understand customers and get to know their lives. Do you?

What’s Your Story: How “Real” Are You?

The beloved companies aren’t afraid to be themselves. They give employees permission to drop the “corporate veneer” and encourage them to take the best version of themselves to work and into their relationships with customers.

They work hard to eliminate the feeling of “big company” and “little customer.” From The Container Store, who urges their people to act so flexible that they give a “Gumby” award, to WestJet’s self-effacing title of “Big Shot” for their executives, the people inside these companies take their work seriously but not themselves. They revel in letting their warmth come through.

Setting the tone and giving “permission” to be this real are often the leaders inside these companies, who make it okay for everyone to do the same. At LUSH, founder Mark Constantine sets the tone for the conversations with customers. At Headsets.com, founder Mike Faith is the zealot. Even after their founders leave, beloved companies work to keep the vibe going. Trader Joe’s has stayed entrenched in their culture, even after founder Joe Coulombe retired in 1988, and then even when it was sold to German entrepreneur Theo Albrecht. In the hand-off between three CEOs—from Coulombe to John Shields and now to Dan Bane—Trader Joe’s has stayed true to who they are, to what connected them to their legions of fan-customers.

The language and communication a customer receives from the beloved companies is straightforward and uncluttered. This communication is often so unexpected that the messages they send take on a viral life of their own, such as the order confirmation sent to customers by CD Baby. Humility, at times humor, and, almost always, lack of pretense or protocol define personal interactions with people inside the beloved companies, because they’ve been encouraged to be themselves. You only have to be on one or two Southwest Airlines flights to know how much the company celebrates the humorist in their employees and encourages them to bring that to work with them. By being willing to work “without a net” of corporate language and protocol, the beloved companies opt to build relationships between people. They work hard to connect with what we all have in common. As people.

These decisions and actions embody what is behind the beloved companies who are authentic and real. They take what informs their personal decisions with them into business. They let their roots influence decision making. People call upon their personal experiences to inform their behavior. And they blend it with their business acumen to accomplish extraordinary outcomes.

“Beloved companieswork hard to eliminate the feeling of ‘big company’ and ‘little customer.’”

Companies who decide to be real pull customers and employees to them. Where are you today?

• Do leaders blend who they are as people with how they lead?

• Would you want to read your invoices, bills, or contracts?

• How are customers greeted when they call your company?

• Are people scripted or guided?

• Do you discuss customers or contracts? Insurance policies or families?

 

CHAPTER 5 - Decide to BE THERE

The middle of the road is where the white line is and that’s the worst place to drive.

—ROBERT FROST

Zara Decided to Invest in Product Speed, Not Advertising.

DECISION INTENT: Create “Fast Fashion.”

Zara wants to get a product from inception to market—inside a store on a rack and available to their zealot customers—within 15 days. This speedy process for bringing in product and changing out inventory creates an on-purpose product extinction cycle, and a compelling draw for customers to constantly visit Zara stores. “Fast Fashion” is Zara’s customer magnet. It brings customers into stores to see what is new, what they must not miss, and what they must own before it’s gone forever. Speed of fashion for Zara also means having an agility for listening to and responding to customer requests in the marketplace. Inditex, Zara’s parent company, says that an item requested by enough customers can be in their stores to accommodate that request within ten days.

MOTIVATION: Pull Customers Back into the Stores with “Fast Fashion.”

Zara’s understanding of customers drives its decisions for how it designs, produces product, and stocks its stores. Zara works to appeal to the emotional desire of “fashionistas” to be one of the first and one of the few to own a particular item of clothing. This emotional desire pulls customers back into the stores; it is their magnet for customer repurchasing. To constantly earn this devotion, Zara’s “Fast Fashion” operation integrates design, manufacturing, and distribution, all managed from their headquarters outside La Coruña, Spain. To create exclusivity, they produce small batches of each style. Three hundred designers work to create the continuous stream of new looks in their stores, resulting in 20,000 new designs a year.

Zara wants customers coming back into their stores, where they will always find new products, in limited quantities. This is how Zara creates urgency to buy now. The blue blouse she loves today may be gone tomorrow.

IMPACT: Customers Visit Zara 17 Times a Year!

By understanding what motivates its “fashionista” customers, Zara has changed the definition of success in fashion retail. Customers make an average 17 annual store visits, compared to 4 visits for other retailers. The Zara “habit” that keeps customers coming through their door results in more products sold at full retail: nearly 85 percent of Zara’s inventory sells at full price, compared to a retail average of 40 percent. Most important, because customers are Zara’s sales force, advertising is hardly necessary—it’s a mere .3 percent of sales, compared to competitors’ 3 to 4 percent. How much do you know about your customers’ lives and what makes them tick? What’s your version of “fast fashion” for your customers?

Rackspace Decided to Eliminate Silos for Customers.

DECISION INTENT: Eliminate “Customer Hot Potato” Service.

San Antonio-based Rackspace grows by imagining the life of their IT manager clients. And that means making it easy to get help, support, and service without the customer “hot potato.” So Rackspace is organized by teams assigned by customer account, in order to create customer peace of mind. Rackspace’s Web site explains this commitment: “No more call centers. No more dealing with a different person every time you need something. No more transferring you to the ‘expert’ who transfers you to another ‘expert.’ . . . And, most important, no more feeling like you’re just one more anonymous customer stuck in a system that works against you instead of for you.”

MOTIVATION: Unify Accountability for Customer Grow th.

With this decision, Rackspace is there for clients, on their terms, with a reliable delivery method they can count on. Teams are assembled to include everyone a client needs: account managers, engineers, support technicians, billing, and data center professionals. Everyone on the team has a common set of goals aligned to the client’s goals. And they are all rewarded and recognized together—with shared accountability—for ensuring the customer’s needs are met. This team structure ensures that when the client calls their account manager, ready resources are available to support the client. The traditional silos that create the “hot potato” experience are gone. So the client doesn’t have to figure out who to call for what and when. Rackspace connects the team to give customers peace of mind.

IMPACT: In 11 Years, Rackspace Grew from a $34 Million to a $1.4 Billion Company.

Serving a diverse customer base of 53,500 worldwide, Rackspace’s growth is fueled by “being there” for IT managers. They understand that people who choose IT hosting want someone else to be responsible for their servers, period. By reliably and seamlessly managing the hosting of Web sites so that their clients can stay focused on their businesses, Rackspace has earned the right to grow. It concluded 2008 with significant growth in both revenues and net income, and has experienced revenue growth of 59 percent annually over the last five years. Revenues grew from $139 million at the end of 2005 to $531.9 million at the end of 2008. They have turned a profit during this entire period. Do you make customers traverse your organization chart to do business with you? Would your customers say that they are handed off to many people before they eventually receive help?

What Story Do Your Decisions Reveal? Are You There for Customers?

Do you want to be loved by customers? Imagine them in their lives. Get to know them. Understand what is important to them. And obsess about the moments when you intersect their life. Then deliver something that makes those moments better. With your actions, show customers that you make decisions with their point of view in mind. When you do, they’ll buy more from you. And tell everyone they know.

Beloved companies won’t operate from the middle of the road of indecision and noncommitment. They spend their days (and nights) obsessing about how to be there for customers on the customers’ terms. They imagine customers’ lives. And they think and rethink how they will conduct themselves so they can constantly earn the right to customers’ continued business.

Companies that understand that it is emotions that bond them with customers obsess about getting to know who their customers are and what they desire. When they tap into these emotions and desires, they open up a world of possibilities that can capture the imagination of their business. And that leads to uncommon decisions that separate them from the pack. It grows their business.

Remember, the everyday company is selling cups. The beloved company is supporting parenthood. They share in customers’ aspirations and dreams. And become a part of their lives. Are you there for your customers? Do you earn the right to their future business?

Where are you today on deciding to be there for your customers?

• Do you begin with the customer or the product?

• Are your meetings spent discussing sales goals or customers’ lives?

• Do you imagine a day in the life of your customers?

• Do you understand their lives so you can improve their lives?

• Are you selling cups or supporting parenthood?

CHAPTER 6 - Decide to SAY SORRY

In the course of my life, I have often had to eat my words, and I must confess that I have always found it a wholesome diet.

—WINSTON CHURCHILL

Intuit Decided on a $15 Million Apology for Their TurboTax Errors in 2007.

DECISION INTENT: Remove the Panic, Fix the Problem, and Eliminate Customer Penalties. It’s April 15, and you take the last few minutes before the 12 midnight deadline to review your tax return before filing it electronically through TurboTax, run by Intuit. Then you click “submit” and the unthinkable happens. Your computer screen flashes: “Servers overloaded, try again in 2 hours.” Terror sets in. Your only hope is that you’ll receive understanding about your predicament . . . from the IRS! This is the account of a blogger, who told her story to the world on the Internet. In total, 200,000 customers were unable to e-file their TurboTax returns on time in 2007. They needn’t have worried. Within one day, Intuit had apologized to customers affected by the slowdown in the company’s electronic filing process and removed their worry about having to explain to the IRS. Intuit acted decisively, humanely, and in their customers’ best interest. They saved the day for their customers.

MOTIVATION: Don’t Make Customers Pay for Our Mistake. This message from President Steve Bennett set Intuit’s tone and their course of action: “We deeply regret the frustration and anxiety this caused our customers. This is not the experience customers have come to expect from Intuit. It’s not acceptable to us, and we will do right by our customers who were impacted by this delay.” Intuit secured a concession from the IRS allowing taxpayer customers affected by the delay to file their returns until midnight on April 19 without penalty, and committed to pay any other penalties customers incurred as a result of the delay. TurboTax customers received automatic refunds of credit card charges made during the period of time when the servers overloaded.

IMPACT: 81 Percent of Sales Are Attributable to Word of Mouth.

Intuit invested $15 million on this action. Decisions and actions like these drive Intuit’s growth. Most customers’ sentiments echoed those of the blogger who said: “Intuit has blown me away.” Brad Smith, Intuit’s CEO, attributes 81 percent of sales directly to customers telling other customers about the company. Even during slow economic times, Intuit revenues grew, increasing 11 percent in the last quarter of 2008 to $478 million. In moments of service failure, customers see a company’s character. Beloved companies put as much forethought into planning customer-experience recovery as they do planning recovery for IT and natural disasters. How many 12-hour clocks would wind down before your company responded to a customer problem? Customers are watching the clock—every minute. The amount of time that goes by before you respond tells them the story of how much you care.

Southwest Airlines Decided to Proactively Apologize to Customers.

DECISION INTENT: Apologize Even Before Customers Complain. Colleen Barrett, president emeritus of Southwest Airlines, told me, “We knew from day one that we wanted to be in the customer service business. The business we were in just happened to provide airline transportation.” Colleen’s notion is this: if you want to be best in customer service, then you’ve got to be proactive about it. You can’t wait for customers to tell you about your problems. You’ve got to be out ahead of them every day. And that includes when you make a mistake. So Colleen established a manifesto and a group dedicated to what Southwest calls “Proactive Customer Service.” This gets right to the heart of the matter for why this team exists.

MOTIVATION: Southwest’s Desire to “Wow.”

Southwest has turned the process for “saying sorry” into a core competency of their business. Each morning, a “MOM” (Morning Overview Meeting) is convened. The people who run the airline’s operations, its meteorologist, and Proactive Customer Service team members review the flights of the previous day for delays, issues, and service glitches. They get a read on the weather for that day that might have brought passenger delays and challenges to airports. Then the Proactive Customer Service team goes to work. They imagine themselves as passengers and decide which events warrant an apology, a hand of human kindness from Southwest. Depending on the severity of the situation, this ranges from offering the passengers’ next flight for free to a percentage off in the form of a LUV voucher. All come with a hand-signed, personalized letter customized to the experience customers encountered. No mass produced “sorry” letter allowed here!

IMPACT: Proactive Apologies Generated a Net Return of $1.8 Million in 2007.

For Southwest, their instinct to take “Golden Rule behaviors” makes them profitable. It helps to keep them flying. Based on how Southwest Airlines customers redeemed their LUV vouchers, and after completing the appropriate revenue accounting practices, a net return of $1.8 million was generated in repeat flying in 2007 by customers who received letters sent from the PCS team. Southwest Airlines has consistently received the lowest ratio of complaints per passenger boarded of all major U.S. carriers that have been reporting their statistics to the Department of Transportation since September 1987. The Wall Street Journal named Southwest Airlines the airline champ of 2007. In a 2008TIME.com survey, Southwest Airlines ranked number one for being the friendliest airline. Can you form a proactive team to do what Southwest does?

Baxter CEO Harry Kraemer Jr. Decided to Voluntarily Reduce His Bonus

DECISION INTENT: Act Immediately Regardless of Who Is at Fault.

“Let’s make sure we do the right thing,” CEO Harry Kraemer told Alan Heller, president of the Baxter International Inc. division responsible for dialysis equipment, when dialysis patient deaths began in August 2001 in Madrid, Spain, and Croatia. Rather than waiting to know if they were at fault, Baxter took accountability immediately, with a global recall of all of the filters and a hold on distribution of warehoused filters. It was finally determined that a fluid made by another company that was not flushed out of some of the filters during equipment testing had entered patients’ bloodstreams during dialysis, causing the deaths. Even though this error was not caused by Baxter, their equipment was involved. CEO Kraemer didn’t blame other parties and didn’t hide the facts. He apologized publicly with heartfelt empathy and humility. As a result, Baxter decided to shut down the plants that made the filters. They settled with all families involved.

MOTIVATION: Decide and Act Guided by Values.

“What we try to do is do the right thing,” Kraemer said when asked about this situation. “I think there’s a tendency to make things more complex than they are. If we live the values we profess, we’ll add share-holder value. I don’t see a conflict.” Under his watch, Kraemer made sure that Baxter could live those values by opening up dialogue on translating values to decision making. The company’s actions related to this incident cost Baxter $189 million. Holding himself personally accountable, Kraemer asked the board to reduce his 2001 bonus by 40 percent. And he recommended that accountable executives’ bo nuses should also be reduced by 20 percent.

IMPACT: Henry Kraemer Gave an Indelible Lesson on Deciding with Your Values.

As a result of Baxter International’s 2001 filter crisis, the stock dropped, but it soon recovered. The financial community applauded the straightforward talk and recovery. And Baxter’s employees got a lesson. The congruence between values and decisions even in a tragedy buoyed employees’ faith in Baxter and Kraemer. Henry Kraemer was flooded with e-mails and messages from proud employees. Kraemer said in an interview one year after the incident. “If the values are authentic, then so are the decisions and the actions.” In a time of crisis, are these your proudest moments? The decisions will be tough, but making the right ones will signal your values, what you believe in, and if your decisions are guided by them.

How Well Do You Say “Sorry”?

When things go wrong, are you nimble enough to spring into action, identify the issue, plan a recovery, and implement it within a day? How about within hours? That’s what your customers expect and deserve.

“Being human and prone to making mistakes, we’re in luck. ”We have the opportunity regularly to make amends.”

It has been proven that a genuine apology strengthens the emotional connection that a customer has with a company. Being human and prone to making mistakes, we’re in luck. We have the opportunity regularly to make amends.

I’ll end this chapter with an infamous human dispute that occurred between not a company and a customer, but between two sports legends. George Steinbrenner, owner of the New York Yankees, unceremoniously dumped beloved Yogi Berra as manager of the team in the middle of the 1985 season. Steinbrenner didn’t deliver the news personally. He jobbed out the task to a member of his organization. Steinbrenner never apologized to Yogi Berra for his action or the manner in which he carried it out. Berra vowed never to set foot in Yankee Stadium again. Many secondhand invitations to return to Yankee Stadium were delivered to Berra over the years, but he didn’t budge until Steinbrenner got personally involved. Fourteen years later, Steinbrenner finally apologized to Yogi Berra. This belated apology violated the first principle of a good apology: swift delivery. But it was sincere and humane, and he took the blame for the action. After 14 years, they made amends.

Apologies to customers are being tossed about very freely these days. But they often are missing the components which give an apology meaning. Yogi Berra knew when Steinbrenner was finally genuine about making amends. And only then did he agree to accept his apology. He could tell that Steinbrenner had had a change of heart.

Repairing the emotional connection with your customers and reaping good results has conditions. Your apology must:

• Be genuine.

• Restore confidence in being associated with you.

• Honor those harmed.

• Explain and work to resolve the problem.

• Be delivered swiftly and with humility.

Remember when you were a kid and your brother or sister punched you or pinched you? Sure, he or she apologized. But it didn’t mean much because (a) your parent was usually prompting the words, and (b) you’d been apologized to many times before, just to be punched again another day. This is what we put our customers through when we deliver a hollow apology and then don’t fix the problem causing the issue. You’ll likely get credit when you apologize once for a problem. But when it repeats, another letter for the same problem won’t cut it. Your currency with customers and their trust in you will dwindle.

“Remember when you were a kid and your brother or sister punched you? “Sure, he or she apologized. But it didn’t mean much.”

Beloved companies turn “recovery” into an opportunity that says to customers “Who else would respond this way?” They are zealots about recovering customer goodwill. The measure of the company is determined in these moments. And they obsess over every moment of these situations because they know that customers are keeping score.

Do you deliver “Sorry” well?

CHAPTER 7 - The Decision Is YOURS

Whenever you see a successful business, someone once made a courageous decision.

—PETER DRUCKER

It’s Now Time for You to Make a Choice.

These brief stories of decisions made by beloved companies have given you a view of the inside of the “clock”—the inner workings that enable a company to become beloved. For these companies, making decisions is how they enable moments of “wow” in a world of customer-experience “vanilla.” As you progressed through each chapter, learning about the beloved companies, understanding their decisions, and then contrasting them to your own, you should now know how different or similar your decisions are to theirs.

What draws us to people in our lives are the commonalities that we have with each other. “Golden Rule behaviors,” as Colleen Barrett from Southwest Airlines calls them in her Foreword, are our natural tendencies to do the right thing—selfless acts of kindness, in which the reward itself is being able to make decisions that result in treating people the right way. The beloved companies in this book blend commerce with their humanity, they blend their personal lives with their business lives, and they make decisions that are congruent with honoring the person on the other end of the business transaction.

Beloved companies know that in those fleeting moments, they are defined. They know that the actions that come from their decisions indicate what they value. They know that those actions show how much they considered the customer on the other end of the contact, and that those actions reflect back on them—giving customers a glimpse of who they are as people.

Love is irrational. Customer love is a reward for (what some consider) irrational business behavior. Companies who grow because of their bonds with customers do so because they aren’t always looking over their shoulders at what each decision will get them. In a world where products and services are available in a hundred variations, these companies get a disproportionate piece of the pie because of how they treat their customers.

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