Costco continues to amuse and amaze by offering more than the usual products to pile in the cart. The Costco Connection magazine for June (www.costco.com, "connection") has a page devoted to "Fresh Views," with mini-features on: Wally "Famous" Amos (who has moved on to found Wally's Muffin Company),brainstorming techniques, and a quick summary of a 2009 book, Extraordinary Groups: How Ordinary Teams Achieve Amazing Results.
My big takeaways this month, aside from a hankering for a muffin or a chocolate chip cookie, were from Extraordinary Groups. One - not quite an aha! moment - was that a group dynamic can hinder, rather than stimulate, group productivity. The other was that "exceptional experiences can be thoughtfully nurtured and intentionally encouraged."
Good stuff, but the authors may have missed the larger point, which is that transporting tools and techniques for elevating group performance, to the operation of business relationships involving entire companies, can magnify and multiply the consequences of what might be accomplished.
Maybe an even greater message, though, lies in how Costco works at a fuller customer relationship by providing unexpected value, beyond the nuts and bolts of selling them tires and tube steaks.
The idea of having access to a shared master schedule that all employees to view and edit seems like a great idea.
With a shared master schedule it is easy to identify when someone is on a business trip or took an afternoon off, and it can help tremendously with communication in general. Many offices have some form of master schedule in place already. In many cases this schedule has gone digital.
This is one of those wonderful ideas in theory-- and in practice, so long as it is not abused. I heard about a large company that uses a scheduling program that allows high-level employees to book meetings with their employees as long as the time slot is available. This seems fair, and like a smart system.
Some executives are trying to enforce a software change that would allow them to reschedule or cancel their employees' meetings so they can schedule meetings in the once-occupied time slots. It is my personal opinion that canceling someone else's meeting is crossing the line into abuse of the system, but I understand others-- like busy executives-- might think otherwise.
What do you think?
Actress Gwyneth Paltrow has a lifestyle newsletter, GOOP, that every now and again prints a piece that really makes me think.
This week, the topic was on friendship, but I think the following quote on agreements applies really well to business relationships and friendship.
"The important thing to recognize about agreements is that it takes more than one person to make one. If we see that an agreement is not serving our well-being and the well-being of our friend, it is intelligent to break it...and it is possible to break an agreement without abandoning the friendship." (Author, of this quote and a forthcoming book on open-ended questions, is Elizabeth Mattis-Namgyel)
I believe if you were to substitute in the words 'business relationship' for 'friendship' in the above statement, the same would hold true.
Have you ever abandoned a business relationship that was not adding to your company's well being, and/or the other party's well-being? Where is that relationship now? How is the health of that relationship?
I am a big fan of Greg Mortenson and his work in central Asia that is chronicled in Three Cups of Tea. For those who have not yet read this fascinating book, the tiltle comes from a Balti saying explaining the process of moving from stranger, to friend, to family. It is the secret for getting things done. As Mortenson moves throughout the region, mobilizing rural communities to build schools for both boys and girls, he learns from those he has gone to serve. The book is a testimony of what one person can achieve when there is passion, humility, courage, determination--and teamwork.
Although I found Greg's first book fascinating, I am even more taken by his latest book, Stones Into Schools. Here he works in Afghanistan, where his work is more dangerous and the location more remote. In this book, he reflects one of the most important lessons he has learned along his journey:
Of the many lessons that that old man imparted to me, this was perhaps the greatest. It underscores the importance of taking the time to build relationships, while simultaneously affirming the basic truth that in order to get things done in this part of the world, it is essential to listen with humility to what others have to say. The solution to every problem, Haji Ali firmly believed, begins with drinking tea. And so it has proven. (Stones into Schools, Kindle locations 379-86)
The power of listening and of building relationships is fundament to Mortenson's work. He learns that in tribal areas, although skill and courage are important, relationships are the key to success. In my experience, that's true not only in tribal societies but in 21st century business as well. If we could only spend a little more time listening and building relationships, perhaps work would be a little easier and more rewarding.
Within the past year, I have become a huge fan of Southwest Airlines for business travel. Their new boarding process has overcome my previous major objections. Add to that their free baggage policy (for the first two bags), on-time arrival and departure, regular pilot communication, and the use of full size planes has turned me into a raving fan! And given the frequency of my business travel, that has turned into real money for Southwest.
Jody Hoffer Gittell, author of The Southwest Airlines Way: Using the Power of Relationships to Achieve High Performance, argues "that Southwest's most powerful organizational competency- the 'secret ingredient' that makes it so distinctive- is its ability to build and sustain high performance relationships among managers, employees, unions, and suppliers." p.xii
If you have always wondered how to turn business relationships into a competivetive advantage, check Gittell's book out. You will soon see how the deceptively "soft stuff" turns business relationships into gold.
(Southwest Airlines Way is available on Amazon.com)
Dr. Gabriel Weisskopf, CEO of Softair AG, has wryly observed (in a recent issue of Air Cargo World), "change is inevitable - except from a vending machine." And, so it is, which brought Spencer Johnson's 1998 mini-classic Who Moved My Cheese? to mind.
The little book has been much abused, sometimes being handed out during periods of turmoil as a managerial way of saying, "Get over it, and get back to work." Difficulty in dealing with change is not confined to a rabble of knuckle-dragging mouth-breathers, though. It afflicts us all in some degree, no matter how enlightened we may think we are.
And, it's not a challenge confined to individuals. Organizations - and their operating relationships - struggle with change. Wheteher we are inclined to be reactors or proactors, continuous change stresses our capablilities and the quality of our business relationships.
Weisskopf maintains that we collectively live on a planet called Comfort Zone. I'll add that the planet is ringed with the Moons of Denial. Nevertheless, change is a constant in our business lives, and winners will be facing change and taking action. But, it's not as easy as a motivational book might lead you to believe.
By the way, it's perfectly okay to challenge the premises of change, as long as the challenge is healthy and not a smokescreen for the warm fuzzy option of inaction. At the end of the day, though, management by hope is not a workable strategy in a universe of change, especially when tightly linked supply chain performance is at stake.
Atul Gawande is a surgeon who has written a number of great books about practicing medicine in the United States. The Checklist Manifesto , his newest book, argues convincingly that checklists for surgeons improve safety and lowers critical mistakes by some 35% (he was able to demonstrate this at a hospital over a year).
One of the items on his surgery checklist speaks directly to relationships. The checklist question asks--before the suirgery--if everyone knows everyone and asks all people in the surgical theater to say their names and their job. What Gawande has found is that if you start the surgery by having everyone say their names, they feel more a part of a team and, more critically, they are better able to speak up if they notice anything wrong. In surgeries where people are not recognized, there is a great hesitancy on everyone’s part to speak up, even if people see something that they think is not right.
Recognizing people and their interrelationships improves medicine, improves teamwork and improves overall performance. Relationship before task. JSperry
Actually, there are many roads out of Chaos. The one that leads to Conformance is called Collaboration. It is full of twists, turns, and surprises, and takes longer than one might imagine to reach its destination. Two cases from the world of logistics and supply chain managment come to mind.
One is the 'umble wood pallet, a staple in any distribution center and indispensable for moving products on a more-than-one-at-a-time basis. Fifty years ago there were no particular universal standards for pallet size and construction. A food company pioneered the development of a "standard" pallet, which later became known as the GMA pallet. 48"x40", it is today the dominant pallet size in North America, and correlates closely with the 1.2mx1m European pallet. (There are still other sizes surviving, notably the 42" pallet used in telecommunication industry.)
The struggle to achieve this relative uniformity across a spectrum of companies and supply chains was tough, and initial resistance to the notion delayed serious collaborative development for several years.
More recently, the marine cargo container ("shipping container"), which has made efficient global supply chain execution possible, and piles of which crowd freight yards and intermodal terminals across the country, has undergone a remarkable journey to get from Chaos to Conformance. The painful birth and development of the "standard" shipping container is detailed in the soporific, but vitally important book, The Box, by Marc Levinson.
The basic concept originated in 1953, with the first container shipment going from Newark to Houston in 1956. But, the multiplicity of container sizes (and backers) threatened to shut down the emerging trend by the late '50s. It took until 1970 for ISO to publish the first complete draft of its standards. Although considerable progress was being made while standards were still in development, there were still holdouts involving two major shipping lines in the late '60s.
The lesson here is that the relationships required to successfully navigate from Chaos to Conformance can be incredibly more complex, sensitive, and fragile than those involving supply chain partners, or even an end-to-end set of supply chain collaborators. They tend to be transient, but intense. They necessarily include governments and labor unions, and they often have international ramifications - and participation.
Many of the participants in the debate and resolution play roles that transcend the usual picture of supply chain relationships, such as seaports, railroads, air cargo carriers, and airports. Further, the operating entities involved may be bitter competitors in all other aspects of supply chain execution, suspicious of one another, as well as skeptical about new thinking.
In summary, the Collaboration Road from Chaos to Conformance may be a bit like Maui's Road to Hana. Difficult, and on some days seemingly impossible, full of pitfalls and opportunities to crash, but in the end, the only way to drive there.
What do you think? Do you have other examples?
A 2009 issue of Ken Ackerman's Warehousing Forum featured a lead article about business relationship management by Elijah Ray, Senior Vice President for UTi Integrated Logistics. Elijah has been an enthusiastic adopter of thoughtful business concepts for decades, and has been uncommonly successful in applying new thinking to effective - and profitable - supply chain execution. His approach to supply chain business relationships is anchored in four pillars described in Daniel Goleman's landmark book, Primal Leadership: Realizing the Power of Emotional Intelligence. They are:
He goes on to delineate the skills needed to enable and manage effective relationships:
Elijah continues by illustrating the application of those skills in a focused distribution setting, but acknowledges their applicability throughout supply chain relationships. Importantly, he recognizes that many organizations are in transition from an old-school cost mentality to a new school that uses relationships to create competitive advantage. In a critical observation, Elijah links success in relationships to the linkage of effective human connections with systematic processes.
With a nod to Dr. Stephen Covey's Seven Habits of Highly Effective People, he calls listening with the intent to understand the beginning of true communication and relationship building. Elijah Ray has, esseentially, created his own approach to business relationships by drawing from a number of sources.
It seems to be working. Maybe that's because Elijah walks the walk; he is as real as the ideas he preaches. What's your take? Do you and your organization have what it takes to build a sustainable relationship management process?
Some early insights into the power and value of supply chain partnerships appeared in We're All In This Together, a Harvard Business Review article by Douglas M. Lambert and A. Michael Knemeyer of The Ohio State University. The brief piece dealt with a Wendy's/Tyson partnership, and described the outline of a Partnership Model and a four-celled matrix structure for classifying partnership potentials into high-value and low-value targets.
Those concepts have matured considerably, and are fully described in the recent book, Building High Performance Business Relationships by Lambert, Knemeyer, and John T. Gardner. A summary of the key components of partnership programs was recently presented to a Breakfast Club meeting at Ohio State's Fisher College of Business. It outlined a comprehensive set of specific elements in families of Drivers, Facilitators, Components, and Outcomes that lead to supply chain partnership success.
The plusses, as I see them, are: 1) the wealth of case-based real-world partnership accomplishments involving major corporations, and 2) the richness of detail involved in constructing, analyzing, and refining partnership practices. I'd like to see more examples of breakthroughs involving "followers" along with those somewhat expected of "leaders." Some academics have recently suggested (in CSCMP's Journal of Business Logistics) that the net impact of adopting positive practices by the real world's many followers is considerably greater than the contributions of the relatively few leaders in the field.
That said, I recommend getting an understanding of this perspective on partnerships, giving some thought to how the principles might apply to the world beyond supplier/customer relationships, and considering what the human dimensions of making these partnerships work might be.
I'd be interested in hearing what you think about the approach described.
David Maister is the consultant whose hard-won wisdom has guided an entire generation of consultants. He hasn’t written about key account management very often but in this essay (which later became Chapter 19 in his 2000 book The Trusted Advisor) he lists some points that are as insightful as anything else he has written. The article is called, appropriately enough, “Key Account Management.”
I’m going to list some of his insights verbatim and suggest strongly that you take a look at the article because it contains other real-world suggestions about managing key accounts.
Below are just a few of his points.
Key accounts’ commonly expressed concerns about suppliers:
Other insights:
All I can say is that if the points above do not offer some assistance with your key accounts, you must be in a unique market with unique accounts. Good reading. JSperry
There are still firms trying to get a handle on what exactly service quality is so that they can deliver it. I can help a bit, drawing from the wonderful research done in the 1980s by Valarie Zeithaml, A. Parasuraman and Leonard L. Berry. Their conclusions appeared in the 1990 Free Press book Delivering Quality Service: Balancing Customer Perceptions and Expectations. This may seem old information to some but it’s been interesting to see how few of our customers really know this source. In that book the three authors break service quality down into five determinants, from most important to least important:
Reliability: Ability to perform the promised service dependably and accurately
Responsiveness: Willingness to help customer and provide prompt service
Assurance: Knowledge and courtesy of employees and their ability to convey trust and confidence
Empathy: Caring, individualized attention the firm provides its customers
Tangibles: Appearance of physical facilities, equipment, personnel, and communication materials
This may seem like common sense, but the three authors’ conclusions are the only researched determinants of service quality we know. Almost everything else defining service quality is an educated guess.There are some interesting conclusions that can be drawn from these five determinants. The most important, I believe, is that the three most critical determinants come before empathy, on which many service people are hired.
The conclusion is that service quality, while it includes “niceness,” is in fact a detailed performance issue. If your firm is not reliable, responsive and knowledgeable, it will do it no good to focus solely on empathy. And yet much customer service training, in experience, focused on empathy and ways to use it.
To rephrase their conclusion, a firm which seeks to offer quality service most start with the actual expectations of customers and then create systems which allow the firm to provide consistent reliability, responsiveness and assurance.
In designing quality service, a firm needs to see it as a matter of cultural alignment, and not just customer service people being empathic. This is especially true of strategic accounts, where a given person at the account might phone any employee at the firm to get his questions answered. If there has not been effective training and the firm resource called is nice but knows neither the account nor the answer to questions, it sends a message that may be hard to erase in the customer's mind.