Mike Hohnen

Coaching for personal growth, change and development

Service Design

The story your employees tell their friends and family at the end of the day

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We can look at the employee experience from 10.000 ft. as we have done in previous posts (great cultures, conversations and employee life cycle).

Or we can go down real close up and look at the day-to-day experience.

Using the same tools and principles from Service Design thinking that we use in mapping the customer journey, we can map the employee journey over the day. When we look at it that way, a workday has three sections: Before work, work and after work. In each of the sections, we have a number of touch points related to whatever the situation is.

At each of the touch point, there will be 3 things going on: doing, thinking and feeling. The three elements are interdependent. Change one and it influences the other two.

Let’s begin with the end.

What happens at the end of the day? We go home for dinner or maybe off to the pub for a drink and invariably we get the question: So how was your day? And then we tell our story. Sometimes we may even feel a strong need to tell the story without anyone asking to hear it.

Our stories are interpretations.

According to Daniel Kahneman, the remembering self uses stories to make sense of the world. As soon as we experience something, we fit it into the story in our heads. What we retain from our experiences is a story.

Therefore, when we recount a memory, we’re sharing the experience of the story we created, not the actual experience.

And what defines stories?

Most of the individual moments of an experience are lost and don’t make it into the story we remember, except for changes, significant moments, and endings.

Those three key elements are what you need to be thinking about when you think through the employee journey. All three have a direct impact on their feelings.

Feelings often change as a result of shifts in our circumstances. When things go as we expect, our feelings are stable. When things go better, we are more positive and when they go worse than expected, we tend to become more negative. (Unless we are very aware of how this works and know how to deal with our own mindset, but that is a different story). The same goes for significant moments. If they are positive, they influence us in a positive way; if negative we also become negative. That endings are so important may come as a surprise to most people but it shouldn’t.

But if you think about it, when was the last time you saw a movie or read a book that had a depressing ending? There are not a lot of them around. The reason is that if you watch a movie that ends badly, you are not very likely to recommend it to your friends and family. It can be gruesome and depressing most of the time but it needs to end well otherwise you will be disappointed.

Feelings drive engagement.

So in the same way that we try and maintain stable blood sugar levels throughout the day by paying attention to what we eat, we should as managers be aware that maintaining stable emotional levels on our team has a lot to do with how we manage changes, significant moments and endings.

Changes in the day are inevitable, but could we reduce the impact of some of them. Be more clear in our communication or issue; heads-up warnings about things we think might happen. If we do, we make it easier for them to cope.

Significant events, some could just happen we know that but could we consciously create more positive significant events?  Take five minutes to gather around the coffee machine and celebrate something. Ring a ships bell when we sign up a new client and pass around the cookie jar. There are lots of opportunities in a day to make certain moments more significant than others.

The way the day ends not only shapes how an employee perceives the whole day.  How the day ends also contributes significantly to their expectations for the following day. The key question we should be asking ourselves is: do we send our people home and the end of the day in a mood where they look forward to coming back tomorrow?

A hotel head of housekeeping I have been coaching came up with a lovely way to do this. Every afternoon at 3 pm, she gathers the housekeeping team in the restaurant, serves them ‘guest-coffee’ (this was important she told me) and a pastry. They would spend the last 20 min of their shift having an informal chat about the day and how everyone feels. She tells me it has contributed to improving the relationships between them and their sense of being in this together.

What can you do to create great endings for your team members?

I would love to hear any ideas or real life examples of this if you feel like sharing, email me here.

Culture is the foundation of your employee experience.

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The holy grail of Service Design is the much-talked customer experience, but as I have tried to argue in the past few blog posts, if you just paste the elements of Service Design thinking over a terrible employee experience, you are just spray-painting your rusty car in the hope that no one will really notice. Once you hit a bump, the mudguard will still come off.

Culture evolves over time. Sometimes, it just gets better and better but very often it just slowly deteriorates.

If you have ever been part of a start-up or a hotel or restaurant opening, you know what I am talking about. We started out with fantastic intentions and this one-for-all and all-for-one spirit and…

Well then something just happened.

What happened is nothing.

Nothing… in the sense that nobody actively did anything to maintain the culture. Just think of any type of strong culture that you are part of or have been part of.  What keeps the culture alive are rituals, conversations and most importantly, someone who calls it when we step outside of boundaries of the culture.

But in our very busy day-to-day lives, we are typically always working on the systems and the behaviour, creating new processes, initiating training programs, all of the tangible stuff. We forget that we need to maintain and reinforce the culture, and maybe that is the most important job of all.

“Our culture is how we work together as employees to serve our members and grow. Our culture has been instrumental to our success and we keep improving it; our culture helps us attract and retain stunning colleagues; our culture makes working here more satisfying”
– Netflix

What does it take to maintain or even correct the current culture?

Culture does not emerge out of thin air. Culture is the sum of our action, behaviours and conversations.

What we do and how we do it is our culture.

So we are already working on it but possibly not fully aware of how what we do influences the culture.

Don’t confuse action with movement

Great cultures are characterized by their bias-to-action, including taking corrective actions when it is needed. What is typical about rotten cultures is that nobody takes action when it is obviously called for; they do nothing and slowly the culture starts to disintegrate or become toxic. The classic dilemma here is always the brilliant jerks. Bad cultures tolerate them. By tolerating the jerks, leadership shows what their true values are.

In my experience, bad managers are not so often bad because of what they do, it is what they don’t do that makes them bad. There is no action when it is called for.

Do as I say, not as I do!

Some managers think that is a great joke. But it is a terrible thing to say. If you are a manager, you are always under observation. People observe you in order to try and understand their future. They are searching for clues as to what is going to happen and what is important. They don’t pay attention to what you say, they watch your behaviour. Who do you talk to? What meetings do you attend? What projects are you interested in? How you do what you do makes up the clues they use to navigate by.

Many organisations try to regulate behaviour through rules. As time goes, they grow and add more people. Obviously from time to time, somebody does something that is not acceptable and they add a new rule for everybody.  The weaker the culture, the more rules they add. In a strong culture, there is very little need for rules because it is easy for people to work out for themselves what is the right thing to do. And if someone makes a wrong judgement then we have a chat about it to help them see why this is not part of how we do things around here.

Change the conversation and you change the culture.

We become what we talk about. Our conversations make up the glue of our relationships but they also weave the fabric of our culture. If we are always trying to work out who to blame or whose fault something is then we become a drama culture. On the other hand, if we are always asking “What can we do about this?”, we create a culture that focuses on opportunities and possibilities. In the end, there is a world of difference in productivity and engagement.

But it’s not just the subject of our conversations that shape the culture, it is also the quality and the frequency. Solid cultures typically have strong, candid and frequent conversations with each other. Robust feedback is considered essential to healthy relationships. Wishy-washy performance reviews once a year are not part of the fabric of strong cultures

In toxic cultures, people don’t talk to each other about what really matters. They are constantly trying to protect themselves and play cover up. And endless dance in the drama triangle.

No matter how many fantastic new service strategy programs you initiate, they will fail if they are built on a dysfunctional culture. Culture beats strategy every time.

If you are not familiar with the intricacies of the Service Profit Chain, check out my course here

Why the Service Profit Chain is more important now than ever before

There is more to a great employee experience than you think.

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When we design our customer experience, we typically focus on the touch points, moments of truth or my favourite moments of need. Whatever we choose to call them, these are the moments when the customer enters into contact with our service delivery system.

Typically (but not exclusively) the contact takes one of two forms: a human touch point or a mechanical/technical touch point, like a website, a check-in console or even an airplane seat. These are important moments that combined make up the full customer experience.

As I argued in my previous blog post, the human touch points have the highest potential to create the emotional connection that is crucial in our efforts to build loyalty, but they also carry the highest risk. If our human element does not deliver, it can be much worse than an automated experience. The mechanical touch point can generally be engineered to be emotionally neutral but rarely produces something that makes your heart sing. I recently checked in to one of these fully automated hotels. It was late, I was driving and just needed a bed for a few hours. All the automation worked, but I felt terribly lonely, with no human interaction whatsoever. There was nothing wrong with the product. But there was also nothing in that experience that would entice me to do it again or tell my friends (positively) about it.

The front line employee makes or breaks it

Our front line employee has the power to make or break the experience for our customer and if we want to make sure that our customer has the best possible experience, we need to make sure that our employee experience is the best possible. Sounds so evident, but that is not always what I observe out there.

So how do we design a great employee experience?

The starting point is behaviour.

When you think about your customer experience, your dream scenario is that your employee does ‘something’ that will make the customer feel appreciated, valued, looked after etc. This is why a lot of companies invest time and effort into training their staff to do certain things in a certain way and that is great. But it only takes us halfway to where we need to be. Because when our staff does things right, we only score 3-3,5 on a satisfaction scale of 1-5. The reason is that from a customer point of view, good is the expected level. You are not surprising them by being good, that is what they expect, and anyway most of your competitors are also ‘good’ otherwise they would not have even been in the game.

So in order to take the experience beyond the 3.5, we need to make an emotional connection. In practical terms, that means that the frontline staff need to invest a bit of themselves in the transaction. They will need to be flexible and adapt to each interaction and add to that interaction what they think would be meaningful to exactly this customer situation, be empathetic. It is not enough to say: ‘have a nice day’. That is not much better than the voice at the end of the escalator at the airport that says: Watch your step… watch your step… watch…

What drive positive service behaviours beyond just mechanically doing things right?

Motivation drives behaviour.

Motivation, engagement, mindset, call it what you like. But whatever you call it, let’s agree that it is some form of inner drive. The best service employee wants to do this. They enjoy being engaged and that is driven by how they feel. What influences how they feel?

The two primary drivers of how we feel on the job are: The culture that we are part of and the systems we are working with.

When we put all this together, we have the consultant’s favourite 2×2 matrix, but this one is a bit different because it is actually a very simple version of Ken Wilbers four quadrants in Integral Theory.

These four quadrants are interdependent. Change something in one and you affect the other three. If they become unbalanced in the sense that what is going on in one quadrant is not congruent with what we would like to see in another quadrant, then the ‘whole ‘ is not functioning optimally.

A simple example

A CEO called me to work with his group of middle managers. “They are not a team, they do not collaborate with each other and it is driving me nuts,” he said. “Can you please work with them and make that happen?”. So I asked him “What kind of remuneration system do they have?” Oh, he said, ” They get a handsome salary and they can earn a substantial individual bonus depending on how their department performs.”

Game over. As long as he maintains this ‘system’ of remuneration’, the ‘motivation’ for each of them is to do their best in they own department. There is no reason for them to collaborate. If he then further reinforces this by very strictly follow up on individual department performance, it just makes things even worse.

Understand the employee perspective through the 4 lenses

If you start analysing your service business using these four lenses, you very quickly start uncovering all sorts of things that are not congruent and therefore counter productive. The obvious ones are often in the ’System’ category. ‘Process’ or ways of working that are frustrating for front line employee but that nobody has done anything about. These we can often flesh out using Service Design tools like employee journey maps.

But the less obvious sources of disengagement come from the culture box and is typically related to what kind of psychological environment the supervisor and the supervisor’s boss is creating. As I have written about before here, culture beats strategy, always. We will take a closer look at that next week.

This spring we ran a series of blog posts around development, developing yourself and others. We have collected and edited those blog posts into a simple e-book that you can download below if you would like to explore this subject further.

Your customer experience will never be better than what your employee experience was designed to deliver.

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Service Design Thinking is a fantastic toolkit for improving our customer service experiences. Mapping out customer journeys, identifying touch points and understanding different customer personas is going mainstream as everyone chases the elusive super loyal customer.

But did we get the wrong end of the stick?

Let just backtrack for a moment and ask ourselves the fundamental question: why are we so focused on the ‘experience’?

Because in order for something to qualify as service, it has to fulfill two criteria.

It needs to deliver a certain result and there needs to be a positive experience.

If you walk into your favourite coffee shop and they serve you a horrible wishy-washy cup of latte, the setting may be nice and the lady may be ultra friendly but your basic result was not delivered.

Or the other way round.

The coffee is great, but the place is filthy and noisy, the lady is rude. The result was delivered but the experience was horrible. You could just as well have made that cup of coffee at home and saved yourself quite a few bucks. When you opted for going to the coffee shop, you were looking for a service, not just a product.

Ok so far so good. Sometimes it can be sobering to get back to basics.

So assuming that you know how to deliver the result part of whatever service you offer,  let’s examine the experience part. As Seth Godin says, customer service is all about changing feelings. Experiences are emotions in action. No emotions, no experience. How was your train commute to work today compared with the same day last year? Ehhh?? Most probably you can’t remember because if it was just the way it always is, there was no emotion. You have not stored it in your memory as ‘an experience’ (Technically everything is an experience but we only retain in our memory the positive and the negative ones, the rest is auto-deleted).

“The only purpose of customer service is to change feelings.”
– Seth Godin

So as you look at your customer journey and map out the touch points, it’s a good idea to also map the emotional highs and lows. You can start out by estimating them but eventually, you will need to research and confirm your assumptions.

Let’s map a simplified example of a customer journey most of us can relate to, the airport check in: Arrive at airport, check in on the touch screen, walk through security, walk to the gate, board using automated boarding card verification, greeted by stewardesses, Settle into a seat.

What are the potential emotional highs and lows that we could work on to ensure that we maximise the experience? The touch screen provides no emotion unless it is not working, so it is just a negative risk. Walking the hallways can at best be neutralised by making the walk pleasant on the eye and informative. Boarding card verification is again automated. The automated or physical parts of the journey we can work on to eliminate negative emotions but they are hard to turn into over the top emotionally positive experiences.

The the two touch points that have the potential to provide emotional highs are the security check and the welcome onboard greeting by the hostess. The critical variable in achieving this is obviously the human being involved in these two touch points. The customer experiences are in their hands and totally dependent on how they feel (Technically we call that engagement, but that is actually just a fancy word for their feelings toward the job.) If they feel anything less than enthusiastic, they will deliver the minimum required to keep the job.

But, you may say,  we give them a service manual and they get the onboarding service course, they know what they are supposed to do. Yes, they know, but knowing and doing is not the same thing.  They will do or not do depending on how they feel.

In order to understand what drives their emotions, we need to map their employee experience. What is it like to be an airport security agent or a flight attendant? How does their employee journey unfold on a daily basis? What are the emotional highs and lows? Do we know and what can we do to maximise the highs and eliminate or neutralise the lows? (In a Service Profit Chain context, we would call this improving internal quality.)

If you are really serious about delivering best in class customer experiences, you need to start at the other end and look at what kind of employee experience you are providing that is your foundation.  Great service design pasted on top of mediocre employee experiences is like trying to paint over the rust spot on a used car.

You can download the Dream Team Checklist below and benchmark yourself!

 

 

Developing a customer centric experience strategy is not rocket science.

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Applying “outside” in thinking is at the heart of Service Design thinking and it is actually not as complicated as you may think. First of all, it is a question of shifting perspective as I have already explained in my previous post.  But then what?

We can learn the theories, understand the principles and all that good stuff. But nothing much happens if we don’t do something. And if we are looking for change well then we obviously need to do something that we have not been doing until now.

Here are a few ideas for you to get started.

1. Talk to your customers

Most of the service businesses I encounter do not build this into their service delivery time with the customer. By that, I mean encouraging front line staff to talk with customers. This is hugely important. Research has proven time and again that a superior service experience from a customer point of view is an experience where the person serving you talks to you about something that does have anything to do with the transaction. Small talk. This applies to Doctors, Libraries, Restaurant etc Always the same pattern. The obvious presupposes that you are delivering the basic product – If you can’t serve the hot food hot and the cold food cold as Bill Marriott writes then you need to go back to basics first

2. Actively harvest their feedback

While your front line staff is talking to customers, train them to harvest what the customer is experiencing.  Asking questions that explore the customer’s need. This requires more than just ‘ Is everything alright here?’  from a passing waitress.  What is needed is genuine interest, questions that show empathy. Make sure you have a way to capture what they are learning. This can be electronically on a notice board or you can gather teams of front line employee for a brief team session and ask them the question: What is something new or unexpected you have learnt about our customer this past week?

3. Act on their feedback

A hotel that I have been staying at quite a lot over the past years asked me to fill out feedback cards in my room.  On one occasion, I mentioned that their tea mugs on the self-service coffee tray in the room had no handle, and so when I filled it up with boiling water for tea, it becomes impossible to hold. On my next visit, there was a different cup in addition to the standard ones and a small note “Hope this works better”. And 4 weeks later, the handle-less mugs had disappeared. When we show our guests that we are listening, it encourages them to talk to us. On the note, make sure that someone answers comments on TripAdvisor, Facebook, etc. This is a basic psychology of reinforcing feedback loops. If you give nice feedback in return especially to people who praise you, and you thank them in a personal way, you are encouraging others to also want to give you positive feedback.

4. Make a fuss of your most loyal customers

Mechanical loyalty programs don’t cut it here. You need to show your most loyal customers that you actually do care about them, that you recognise that they are special. The only airline I know that does this really well is Air France. Yes, they have the frequent flyer miles and all that jazz, and that is fine. But when the stewardess singles me and maybe one or two others out on an otherwise full flight, addresses me by my name and then initiate some small talks about how it must be nice to be on my way home, I’ll be honest, I feel special. Much more than at my new barber shop that insists on stamping a loyalty card every time I come but still can’t remember my name, or that I actually do speak half decent French. Forget the bloody loyalty card, get personal with me and I will be loyal forever….

What else? What are some of your favourite customer centric actions? Click here and drop me a note.  Take the opportunity also to let me know if you are finding these blog posts helpful. It is always fun to hear from my readers, and hey! I got to take my own medicine… No?

 

How do you achieve the best value fit: Inside out or outside in?

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Everywhere you look, every ‘expert’  on service is telling you that the name of the game is to provide values. And that is true. No value, no business. Everytime you see a high profile brand or product tanks and disappears from the horizon, just think Nokia, Polaroid Kodak, it is basically because they lost it. From the customer perspective, they were no longer providing values.

In the drawing above, the square box represents the company’s offering. It is deliberately drawn as a square to illustrate that we often fall into the trap of having a set solution, a basic service package, our way of doing it. The polygon illustrates the uneven, ever-changing needs of our customers. So, when we overlay what we offer with what they need, we get three zones. The overlap represents the fit (A) where we meet customer needs. The better the fit, the more values we are providing. B is the part of our offering that we charge for, but what the customer does not actually need. And C is the money left lying on the table, in the sense that this is what the customer would really like, but they cannot find it with us and, therefore, either go without it (frustration) or source it from someone else.

Market leaders in a given segment easily get wrapped up in the beauties and benefits of their own products. When they do, the value fit shrinks.

Typically what happens is that they drift slowly from being the customer-centric companies that they were when they were created, and  as a result of over-focus on their own attributes and brilliance, they gradually become more and more product-centric.

This is the danger that lies in the asymmetry that is at the core of the service purchase. What the customer purchases is not what the supplier thinks he is selling. When we forget that, we get lost.

In order to avoid that, we need to understand the the crucial difference between an inside-out and outside-in  customer strategy

Basically you have three options:

  1. I stay behind my own walls, convinced that what I do is great. Great service, great product. It is so great that the world will always beat a path to my door, as they have done in the past. Those who are not here with me must be idiots.As a consequence, I become a hostage of my own past patterns. I look at and understand the world through a filter that is primarily composed of what has worked previously, not realising at all that none of the tomorrow’s problems will be solved with yesterday’s solutions.
  1. I venture to my window from time to time to look out and observe the world. Still, from the security of my own tower, I shake my head at what is going on out there and thank the Lord that I have the right solution. I may feel some concerns, or even frustrations, that out there “they” don’t get it. Maybe I should start thinking of ways to make them listen and understand, possibly turn up the advertising, or make more noise. Or maybe I should start by sending out a survey. I delude myself that I have understood the world by looking out the window.
  1. I leave the security of my tower. I stand next to my customers and together we look at what it is that I am offering. I even try to walk in their shoes for a while and gradually I start to understand what it really means to be in their place. It scares the living daylight out of me to suddenly be in such a vulnerable position.

Only option three will enable you to maximise the value fit.

That is is why the whole philosophy of Service Design Thinking is so important. This is the toolbox that will help you transition from inside out to outside in thinking in your organisation.

 

Service Profit Chain or Service Design?

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Service Profit Chain and Service Design

This is a question I get quite often. And the short answer is that it’s not an either-or, it is a both-and.

The Service Profit Chain is, in my view, a strategic approach. What kind of an organisation would we like to be? It is very much about why we do what we do.

Service Design, on the other hand, is all about how we actually do it. It is the step by step approach to looking at all our interactions with the customer and making sure that they actually contribute to generating values for this customer persona.

“The activity of planning and organising people, infrastructure, communication and material components of a service in order to improve its quality and the interaction between service provider and customers”
– Service Design Network

In simpler terms, you could say that on the one hand, we need to create an organisation that is willing and able to create fantastic customer experiences. That is what happens when we start implementing the principles of the Service Profit Chain.

With Service Design, we then make sure that the service that we are providing is a contribution in the best possible way to create value for the customer.

In practical terms, that means that we take the value equation from the Service Profit Chain frameworks and use that as a key tool to understand what a given customer persona actually wants. Value is deeply subjective and can only be defined and understood from the perspective of the customer.

Once we have that clear understanding of what certain customer personas are looking for, AND how each persona profile is slightly different from other persona profiles, then we can work through our customer journey, and touch point by touch point develop the best possible experience.

In that way, the Service Profit Chain and Service Design complement each other beautifully.

This blog post is part of a series of answers to frequent questions that I get around the concept of the Service Profit Chain. In future’s posts, we will continue to explore other key points. If you would like the full concept served up in one go, you will find Mike’s book “Best! No need to be cheap if…” HERE.

If it is all about loyalty, does satisfaction matter?

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Consistency

It is true that in the Service Profit Chain framework, there is a huge emphasis on establishing loyalty; loyalty is the key driver of profit and growth.

Before we can even hope to establish a relationship that will lead to loyalty, we must ensure that we have a firm grip on the basics and that we can deliver on our promise every time. The keyword here is consistency, the key driver of basic satisfaction.

Consistency or lack of consistency is also one of my pet grievances. Consistency is the flip side of reliability. If as a customer I had a great experience last week, you as a service provider have implicitly promised me that I will have the same experience when I return next week.

If not, you are not only unreliable in my eyes, but you are also performing below my expectations, and we all know that meeting expectations is the first key to customer satisfaction.

This is a balancing act because, on the one hand, we would like to see creativity and initiative on the part of our teams, but on the other hand, we need to deliver a product that is as expected.

The name of the game is to generate repeat business. Customers return to get more of what they enjoyed the first time. If they don’t get that, then they could just as well have gone somewhere else.

Just think back for a moment about how many times in your life you had a great experience somewhere, and then went back only to find that what you had last time was not what you got the next time. Did you go back a third time just to make sure?

Probably not.

Where do you go frequently? Most probably to a place that is very consistent in some aspect of their service delivery that is important to you. That consistency is what brings you back.

Requiring consistency in the delivery process is universal across all types of services. It is the foundation of your success, and that applies to all service businesses, the way your insurance company processes your claim, the way the consultant interacts with you, how your auditing firm performs the audit. You return to the same supplier in all of these situations because you liked the way he or she did the work.

Together with emotions, consistency is an important element in our ability to recall one service experience more easily than others. You remember the consistently good experiences. They stand out. You have a much harder time remembering inconsistent experiences because you easily confuse them with all of the other inconsistent experiences that you have had.

Customers come back to experiences that consistently live up to their expectations. When that happens, we call it loyalty. Loyalty is built on consistency. Never forget that.

So take a good hard look at your basic processes, are they consistent?

This blog post is part of a series of answers to frequent questions that I get around the concept of the Service Profit Chain. In future’s posts, we will continue to explore other key points. If you would like the full concept served up in one go, you will find Mike’s book “Best! No need to be cheap if…” HERE.