Everyone Hates RyanAir. Not me.

You read and read those dry HBR and assorted blogs and Inc, Fast Company and Fortune Magazine articles about how SPEED is a competitive advantage. You hear CEOs intone how their firms are committed to it and then, finally, you see the real thing. It was glorious ‘efficiency porn’ and it was absolutely riveting to watch. 13th October 2012. Berlin. Schönefeld Airport. Around 9 PM. Dry cold day. Clear skies.

The RyanAir BERIN-LONDON boarding area is full, there is NO chair available to sit so I am standing and getting more fidgety by the minute. Jutsyna and I had spent a long day in the city, 6 hours of which were spent cycling. I am tired. So are the 2 dozen other people who don’t have a chair to park their aching feet. And the 100+ sitting passengers didn’t look too energized either. And the plane hasn’t even landed!

And then it did. And the 737-800 pulled right next to our waiting area. 20 feet away.

I found myself thinking despairingly  “Damn…they are going to take more than an hour to seat us inside!”

And I then saw what I suspect is either incredible German efficiency or maybe RyanAir’s . Or more likely an even mix of both. Because, AND I KID YOU NOT, in less than 25 minutes that plane, that had just landed and disgorged it’s passengers, was cleaned, refueled, recharged and the waiting passengers seated and we were taxing OUT for take off. In less than 30 minutes (I wish I had timed it for precision) we were wheels up and on our way to London. In less than 30 #$@%$&$ minutes !

There are flights I have been on where they took 30 minutes to DE-BOARD the passengers! And there are FAST FOOD outlets where I have had to wait longer to get served. Hotels where I have had to wait longer for a ROOM to be cleaned. And you too, I am certain, can probably think of countless businesses where SPEED was touted as a promise and then seen the promise resoundingly broken by the company.

RyanAir gets a lot of flak for a lot of things but this was a winning moment where the critical act demonstrated right there how their low fares were achieved.  It is difficult to join the pitchfork mob online when one sees this kind of visceral proof of efficiency and commitment to speed. No brochure from their PR team can match this pit stop magic.

After this Berlin incident I find myself constantly thinking on many meetings and con-calls “…. we should be able to do X in less than 30 minutes …Surely if a Boeing plane can be turned around in 25…..”

On Marketing : Using the Fan Base

If your business is the kind that could do well with reviews and references from happy customers, what’s stopping you from leveraging it ? If you are a seller of a service that you are proud about and confident about, would you not stand to benefit from your customers letting others know about what you are selling ? What if you incentivise the happy ones to talk about your product and in return pay them in kind or with a discount ? Think about HOW you could do that. Be creative and also pls DO DO be subtle and classy. Don’t over-preach to a zealous choir.

So if you sell fantastic coffee that blows away an fan of coffee and that guy has 452 friends on FaceBook and 321 on LinkedIn and 112 people follow him on twitter , what’s stopping you from telling the guy “Look Tom, every time you talk about us on your network, I am going to give you a free refill buddy. And do it only till you feel we are selling awesome coffee. Stop it when you don’t FEEL it“.

First off, this is a not one of those fake chirpy creeps on Shopping Network Channel, speaking in a patently fake voice about another shitty vegetable dicer. This is a real living breathing fan.

Second, when your accountant/CFO tut-tut’s and tsk-tsk’s you about silly offers like this,tell him this has way better ROI and AUTHENTICITY than sterile print ads that no one really stops to read anymore. This buzz is far more potent.

Third, this does wonders for your own unit’s morale. I mean, come on. You are selling things ppl are FAN of. Have a thing for. Love. Adore. (Think Apple fans). You aren’t just another tree falling in an empty forest. You will be missed when you are gone.

The free refill is only a polite thank you to the fans.

So first make something that is worth being a fan of and about and then make something up to thank them fans for spreading the word.

The likely connection between Profitability and Good Customer Service

ka-ching! : An imitation of the sound made by a cash register, used when someone’s action will result in more money.
Wow! : In this context, the exhaled sound from a delighted customer walking away from the transaction. Usually precedes the Ka-Ching.

Click to enlarge

So the greats (Amazon, Zappos, Apple, Southwest) easily manage both on the above two sounds with reassuring frequency.
The Losers (Go Air India!…or any state managed or funded institution) easily manage the other end of the equation. Communism is an ode to this quadrant.

Interestingness as always is on Quadrants 2 and 4 (top left and bottom right)

Your local bookstore (Coffee shop? Lending library ?) may not be raking in the moolah but you and I sure damn love them don’t we ?! (remember Meg Ryan’s store in ‘You Got Mail’ ?)

And when you have a quasi-monopoly or a govt granted one, profitability can be had even if customer respect is forever elusive. On a longitudinal scale, sustainability is hardest I suspect for THIS category.

And the incompetent managers of the Air Indias of the world need to know pumping money without any real focus on improving customer service is a definition of ‘hopeless financial black hole’ (heard the phrase ‘Putting house before cart?’)

Now my last contention is the Greats have a different more subtle challenge. Everyone falls for the universal lie that a profitable company just totally needs to grow (bloat) on and on and keep at this growth. So the profits fund that. But great customer service is based on a very ‘intimate’ hard won culture nurtured by the early folks and it gets more diffused due to this growth. A real paradox. Few companies can manage the balance. MOST lose the way somewhere. You want to be as small as possible and as big as necessary. The puzzle is not about scale; it’s about scalability. Read Gibbon’s ‘Decline and Fall of the Roman Empire, Vol. 1’ for more on what happens when original culture binds no more and you can’t scale.

So now this above is THE challenge to the winning CEO, not just dealing with the more easy decision of where to open the next outlet.

On Innovation at Staid Firms

A phrase in the article ‘The Next Russian Revolution’ By Chrystia Freeland in The Atlantic about Skolkovo, a planned ‘silicon valley’ of sorts in Russia is worth rehashing : “…..After all, one of the most important—and, if you happen to be a democrat, inspiring—lessons of the past two millennia of human history is that open societies are better at innovation than closed ones.”

This is a NOT a tedious essay about Skolkovo, Russia or democracy. That phrase helped clarify why innovation is such a elusive goal for most corporations. why there is 1 Apple for every 100+ phone making enterprises.

A corporation is at best a benign fascist organization in most places on the planet. The CEO its anointed head. Some heads execute their role well (Welch at GE, Robert Goizueta at Coca Cola) and  some don’t (Skilling at Enron, Araskog at ITT). In Asian countries, even more so, what with its regimented ‘Always obey The Leader’ mentality drilled right from the workers schooling phase. Think typical classes in Singapore, Tokyo and Delhi. You don’t really ‘vote’ for the CEO. He is thrust upon you, the cog. Like honesty and the local politician, innovation and hierarchy rarely mix well.

This is NOT the introduction to an Anarchist manifesto to overthrow this tyrannical system.

Rather, that line in the article, hints at why we find it so difficult to innovate out of a morass of low growth and single digit margins in most enterprises.

If you decide to get a dog to your workplace what would happen at your company ? What if you tried to wear sandals, tee and a cargo pant to work ? At the enterprise where I toil I know it’s going to be minutes before security hauls my ass to HR. And my company is actually one of the better places here in my city (NCR). Yet far too many companies like mine desperately want to see ‘Innovation’ and have launched hundreds of failed initiatives to encourage it. That line in the above article hints why they fail. An open enterprise where tolerance for the non-criminal but ‘weird’ is allowed is far better positioned to reap the rewards of innovation than a closed door ‘265 pages HR rulebook’ run enterprise. If your workplace has a strict ‘dress code’ that is enforced by the under-employed slugs in HR, I can bet it is not at the cutting edge of innovation in it’s industry.

Po Bronson, one of the most eloquent chroniclers of Silicon Valley’s great burst of creativity in the 1990s, titled his classic 1999 book The Nudist on the Late Shift. The naked programmer of his title was a guy who happened to prefer working without any clothes on, and his insistence on exercising that harmless personal choice—on the late shift, when few others were around—struck Bronson as characteristic of the Valley’s famously libertarian and individualistic ethos.

Maybe Paine’s Rights of Man ought to be next on the recommended reading list for the innovation minded CXO.

On Corporate Innovation

I was at a my company offsite recently and we were deep into discussing why it was imperative that we move away from offering just wage arbitrage as a USP and embrace ‘Innovation’ more aggressively.  The audience was reminded that our competition was matching us on the price front and so ‘innovation’ was the ticket out of that race to the bottom.

That is when the epiphany hit me : Innovation is not and should never be ‘a Goal’. It is a FALLOUT of a certain culture.

Culture is a ‘photo mosaic’. Remember those pictures you see where there is a person’s face and it is made up of thousand of smaller photos arranged to arrive at the face of the person. Like this here. Culture is like that. Thousand of small actions and people interactions a day inside the office contributes to creating an org mosaic and some scream innovation friendliness and some just don’t. Now innovation usually results from a ‘fast prototype’ culture and the first 96 prototypes are mostly crud. The 97th usually is ‘Go To Market’ capable.

Robert Sutton, a professor of management science and engineering at Stanford University, who I suggest you read, says “”One of the best tests of my leadership — and my organization — is “what happens after people make a mistake?” ……Failure sucks but instructs. In fact, there is no learning without failure — and this includes failing at dangerous things like surgery and flying planes. Discovery of the moves that work well is always accompanied by discovery of moves that don’t. This is why failure is so endemic to innovation. ”

So ask yourself Mr.CXO if you are willing to climb the ‘failure friendly environment’ tree to get to the eventual fruits of innovation. For I have sadly seen A FAILURE of concept,idea,beta finish peoples careers here in Indian orgs.

John C. Maxwell in his book The 360° Leader tells us that we must model the behavior that we desire in our organizations. Consistency is key to establishing the culture you desire in your organization.

Here are several things to think about when establishing a culture in your organization.

– Your behavior determines your culture
– Your attitude determines the atmosphere
– Your values determine the decisions
– Your investment determines the return
– Your character determines the trust
– Your work ethic determines the productivity
– Your growth determines the potential

Innovation expert Scott Berkun got it bang on when he said “….Innovation is all about rapid iteration and prototyping. Which is really about rapid failure. Trying something and failing and taking a step back and trying again and learning how you are going to succeed. The beauty of the startup environment is we have nothing to lose. If you are starting from scratch you are always failing until you succeed. But in a large company, failure is not tolerated.”

Think about it this way. If you want an apple, you plant an apple tree and look after it. Do it well and you WILL get apple by DEFAULT. Without the tree, No apples. No amount of incentivization though cash bribes will truly get your org to become an innovation hub. Cash is like coke. The drug. Instant high. But prolonged use of it backfires very badly.

INNOVATION will naturally result when you get the culture right.  Getting the culture right is TOUGH. Very Tough. And that is why Innovation is a Unicorn we are all chasing to the ends of the org in vain. Spend time creating the right forest with the right ambiance and many unicorns will soon call it home.

The damage bad managers can inflict is astounding

There is only so much good one noble person can do but there is no such upper limit to damage a bad actor can inflict. A good leader-manager can only make so much of a difference. But a bad one can just burn it all down.

Entrepreneurs and CXOs need to be every vigilant of letting in that one bad leader into their jungle. What’s worse, if you call one wolf, you invite the pack. Guy Kawasaki called it the ‘Bozo Explosion‘.

A bad manager can kill morale, weaken the systems, bypass the controls and wreck it all and frighteningly fast at that. What 10 good managers can do in 10 good years, 1 bad manager can undo in 1 (*citation needed). And it’ll usually take 10 NEW good managers 10 years of painful reconstruction to UNDO that bad guy’s damage. Good leaders can make a small positive difference but bad leaders can make a huge negative difference – because they drive good people out. Hiring (manning the gates) is THE most important job any manager has. Don’t simply delegate to HR and leave them to it. Do not consider it a soft job easily delegated. It’s the OPPOSITE.

This perspective is inspired by a masterpiece of an academic article called “Bad is Stronger Than Good,” which was published in 2001 by Roy F. Baumeister and three other colleagues. If you want to really dig in, I invite you to download Bad is Stronger Than Good.. it is very detailed but readable.

Essentially, the authors meticulously go through topic after topic — personal relationships, learning, memory, self-image, and numerous others — and show that bad packs a much stronger impact than good. They review a couple hundred diverse studies to make this point, and as they say at the end, the consistency of their findings about the disproportionate impact of bad things (compared to the power of good things)– like negative emotions, hostility, abuse, dysfunctional acts, destructive relationships, serious injuries and accidents, incompetence, and on and on — is depressingly consistent across study after after study.

This post is ‘dedicated’ to the all the bad bosses out there.

Kudos to your power.

Hacking the Service Code

‘Smart’ pundits who love climaxing to epigrams sometimes dub China the ‘world’s factory’ and India, it’s ‘back office’. Although I would contend this is an irritating reductionism masking an aversion to in-depth research or independent thinking or worse, both, the economic nom de plumes can be taken as a go-point for some mental base jumping.

I am going to focus on India’s moniker here: Back Office to the world.

If we remotely aspire to get anywhere close to being dubbed ‘Good’ in that busy food court, we who toil in its white collar kitchens have to dish out two things well :
1# Consistently good customer service (to both customers calling from Boston and Bombay)
2# In an accent and tone that is readily understandable to the customer who is calling in.

On #1 I have now started wondering what is the process that leads someone to be good or great at customer service ? …….Is it having a role model in the workplace who you can model after and leech knowledge off ? Is it being exposes to said good service that allows you to understand it and dish it out when it is your turn to carry the water ? Is it exposure from international first world travel and targeted reading ? Or is it just smarts melded to a thin rule book dangled over some delicious promissory carrots to the good and the great in the area ?

I am slowly becoming skeptical about accepted wisdom that it can be taught in a 50 by 25 beige walled classroom with a 46MB, 112 slides power point deck by a 28 year old girl of dubious credentials and limited real world curiosity. But then Southwest, Zappos and Apple are doing something right that gets them to the top of that enviable Everest. Even if it is simply hiring the right people who are plug and play in that area.

If India wants to dethrone the reigning champions of the CS game (U.S.A) we have to hack this code and pirate the plagiarized innards of the process to the capable and the interested.

Make Complaining Painless for Customers

Feedback is called the Breakfast of Champions. How easy do you make it for your customer to give you feedback ? How easy is it for you to give feedback to your favorite brands ?

If the process of giving feedback is onerous or exhausting, and your excuse is ‘Our business model is complicated and spread across a huge geography’ I recommend you read up on Zappos and Amazon and how they ended up where they are today. Remember that pithy saying: If you want to find a shortcut way to do a job, give it to a lazy man – he will always finish the job with a minimum of energy output. Make it so that the laziest fan of your product/service can give you feedback with no excuse. Disclaimer : Of course if you are a seller of shoddy products or services you are most likely not too keen to make it easy for your unfortunate ‘victims’ (they are victims more than they are customers) to get in touch with you. Also if you are government entity you positively don’t give a fish. And the very worst thing you can do is install one of those eternally optimistic ‘suggestion boxes’ that will be used to collect cigarettes butts and paper waste for all its life. That was last a good idea in 1967.

Jeff Immelt, GE CEO gave this advice to a deputy: “Spend a ton of time with your customers. Especially when you’re new, the first thing you should do is go out to customers and ask them how you compare with competitors, how your service is, what they think of your products. ….(inside the company)…people tend to get enamored with your title, and people want to look good in front of you. Customers will give you the reality. They don’t care about your title, they just want value. You’ll never get anything straighter than from a customer.”

Now, India, following a global trend, is selling a record number of smart phones. Customers are getting wired faster than ever here. Are you now making it easy for them to reach out to you now that they have some cool, always connected tools to do it ? How easy is it for your customer armed with a BlackBerry/iPhone/Smartphone to email you feedback that helps you get even better at what you do ? And remember, loading your bloated flash heavy company web address on a Smartphone on GPRS/EDGE/3G is a painful exercise on the best of days so an email address that pops right off would be a very smart move if you want lots of feedback to improve your breakfast. Make it a priority. Better still get a twitter handle and a facebook fan page that is monitored by living breathing young marketing whizzes at your company.

Your feedback mechanism should factor in laziness and RESPECT it when the feedback process is being designed.

But what if you are a successful, well-known brand. Do you meet the standard? 4 days ago I was waiting for a train in a random metro station here in Delhi and I noticed something. Too few signboards at the station to tell customers INSIDE the train which station they are at. I love the Metro. And so wanted to pass this feedback to help them get even better at their customer experience. So I googled ‘mail address for customer feedback to DMRC’. Landed me on the ‘contact us’ page all right but no email address. So I called the helpline. I got a bored guy who gave me what looked like a very dubious email address (anuj@delhimetrorail.com). I emailed him anyway.

No response from Anuj so far.

I thought about the episode and decided to really test this theory on how easy Indian brands compare against the best in making it easy for a customer to get in touch with them to possibly help the brand get better. And who better to have on your side with that project than you OWN customers. Did you know MOST of India’s top brands assume you ONLY have a grievance!!

The Project :

First I googled the name of the Top 10 brands on the planet.

The experts in this, at http://www.interbrand.com tell me they are :

  1. Coca Cola
  2. IBM
  3. Microsoft
  4. Google
  5. GE
  6. Mcdonalds
  7. Intel
  8. Nokia
  9. Disney
  10. 10.  HP

Source: http://www.interbrand.com/en/best-global-brands/best-global-brands-2008/best-global-brands-2010.aspx

Next I googled the name of the Top 10 brands in India. Brand Equity (of the venerated Economic Times newspaper) tells me India’s top 10 most trusted brands 2010 are :

  1. Nokia
  2. Colgate
  3. Lux
  4. Dettol
  5. Britannia
  6. Lifebouy
  7. Clinic Plus
  8. Pond’s
  9. Fair & Lovely
  10. 10.  Pepsodent

Source : http://economictimes.indiatimes.com/articleshow/6469107.cms

Then I typed the EXACT same search term for all of these 20 brands. Search string was ’email address for customer feedback for [brand name]’

Added ‘India’ after the brand name for Indian firms.

ex: email address for customer feedback for Disney

ex: email address for customer feedback for Lux India

I added India after the brand names in India to help make the search success chances sharper.

I avoided any site not directly affiliated to the company domain name. Here I noticed a company called GetHuman in US that really tries hard to make it easy for someone to get in touch with a human being in a company.

All searches was run from http://www.google.co.in/ on a Firefox version 3.6.16 browser.

Here are the results of my project (click on the image to enlarge it):

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click to enlarge

And since I used nothing but a laptop and decent web browser anyone can try this for their brands.

Interesting tit bits :

Coke and Zappos both use a company called suggestionbox.com to collect feedback and the site looks very robust. Someone is doing something right at http://www.suggestionbox.com

Indian brands are appalling in how difficult they make it for a customer to get in touch with them. They assume you are a complainer right from the start! Only Pepsodent and Pond’s are web 2.0 savvy and Colgate and Fair and Lovely hate you.

If Jeff Immelt is right and if you really never get anything straighter than from a customer, how can you make it easier for her ? Think about that today.

Oh and did I mention India became the Cricket World Champions last night !!

Unsustainable Business Models

My one favourite place when in London is a Borders Bookstore.  I have spent many pleasant hours is their flagship store on Oxford Street.

The third floor there has a Starbucks where you can, after you have vacuumed for your favourite books from the stores’ aisles below, ordered a latte, proceed to waste the day in one of the comfortable lounge chairs scattered throughout the store. I did sometimes end of purchasing a few books but I suspect most folks just read the books, bought the coffee and walked away when they were done with the former. Probably the only one thoroughly profiting was Starbucks.

Here are some facts I was able to collate from the net on Borders and its competition:

Borders : As of January 30, 2010, the company operated 511 Borders superstores in the United States….On February 16, 2011, the company announced that it had filed for Chapter 11 bankruptcy protection. In 2011 Borders finished 40 years in the business with 19500 odd employees. The last time Borders made a profit was 2006. Its yearly income has dropped by $1 billion in the four years since then.

Barnes & Noble : It is the largest book retailer in the United States, The company operates 717 stores and on Aug 3, 2010, BN announced that its board was considering a sale of the company, possibly to an investor group.

Amazon.com :  Is a US-based multinational electronic commerce company. It was founded it in 1994. In 1999, Time magazine named Bezos ‘Person of the Year’, recognizing the company’s success in popularizing online shopping. It market cap now is $78 billion and revenue is at $34 billion.

Thing is I love Borders AND Amazon and would love to see both of them around for a long time. But in reality, out of every 100 bucks I spend on books, Amazon gets 99 and Borders gets 1. Because Amazon is cheaper and convenient. Maybe because they don’t pay rent on a bookstore in the middle of Oxford street.

In 1994 (when Amazon was founded) I am willing to bet the CEO, COO and CFO of Borders and Barnes & Noble, along with their core senior team must have been part of numerous expensive ‘annual strategy sessions’, golf retreats and  team building exercises. There would have been people in that group from good B-Schools, familiar with Porter’s 5 forces model. And NO ONE in that group would have dreamed that in less a decade they would be done. Finished.  And the double shocker would have been the added wound that it wasn’t because of the other guy (Borders vs B&N). Like Coke finding out they were beaten in the end not by Pepsi but by …Airbus (?!)

The top and bottom (amazon, e-books), did them in. If an overpaid consultant had told the book guys in one of that 1994 retreats that they all need to look at their business threat radar for ‘an online book store outselling them soon’ would it really registered in their mental model of the world they knew or would they have laughed the guy out of the room ? Mental Models are our fixed ideas of how the world works and how things should or shouldn’t be done.  We accept these models so completely that we live our lives according to them.  Everyone has mental models, but we call them by other names, like “truth” or “reality” or “the facts.”  We believe them absolutely.

My contention : “We have an unsustainable business model“. That’s a sentence every C-suite occupant (the ceo,coo,cfo,cto..) should put on a laminated card and carry in his pocket.

Medocrity is inevitable. Resistence is futile.

Or is it ? Why ARE most solvent companies mired in mediocrity ?

Why do companies start in  a burst of creative big bang and then slowly atrophy?

Microsoft. IBM. Xerox. Yahoo. GM.

Is it Risk aversion ? A concept in psychology, economics, and finance, based on the behavior of humans whilst exposed to uncertainty, Risk aversion is the reluctance of a person to accept a bargain with an uncertain payoff rather than another bargain with a more certain, but possibly lower, expected payoff. 

We make choices about how we face risks every day. Some become very cautious, preferring to minimize risks even when the potential benefit of an action is tremendous.

It manifests when managers go for the tried and tested software, replacement hire or quailty management methodology.

But it is the Outliers that change the game and the  play it safe mindset are excluding them all from ever getting a shot at the challenge.