April 2014
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Joseph's Blog

Customer Feedback Loop – Interview with Gautam Mahtani

Welcome to the second of three installments of my interview with Gautam Mahtani Co-Founder and Managing Partner of Customer Feedback Systems.

Joseph: Gautam what is the best practice model you identified for creating a high velocity customer feedback loop?

Gautam: The first step is to make solicitation of customer feedback quick and easy and deploy multiple modes of listening at the beginning of care. Find out essentially how customers want to communicate with you and be there and make it easy for them. For example, let’s say that is iPad technology put into the hands of nurse leaders to simplify the nurse leader process and make it easier for them.

So number one is use technology – make it easy. The second, is real time alerts. Have a mechanism in place to get customer information into the hands of the right action owner with the least amount of resources required from the person collecting that information. We started out, Joseph, with a passion to give a patron a voice while being respectful of their time. What we quickly learned is if we don’t respect the time of the incredibly busy staff to do something meaningful with that information we’re just drowning them in data. So make it easy to send alerts to the action owner. If the meals are wrong or it was too loud last night or the pain management levels are off – allow that nurse leader within seconds to hit red alert, select that department and get that information off their desk and into the hands of someone who can do something about it.

From there, we develop a weekly rhythm where we can feed information to the frontline and it’s purely designed for learning and planning. We’ve managed to boil down on a weekly basis what we call impact meetings to about 20 minutes a week where staff who are incredibly busy can come in, look at how they are performing, look at their goal, look at how they are performing against their goal, make a very quick action item list and move on with their day. And then that becomes the guiding light for the next week. And then from there that information will then go to leadership. This is key.

We’ve never seen a program succeed without involved leadership. We’ve seen plenty fall short of the mark with what they call a “program.” Patient experience is not a program. Customer experience is not a program. It should be in the DNA of the business. So from there leadership’s most important role when they look at analytics of risks and opportunities is not to look for blame. But rather it is to say where do I roll up the sleeves and come in and clear the path. And when that happens it creates that culture of improvement.

The final piece is what we call the report out. You need to show the customer and the staff members what you did in response to the feedback. Whether it’s signage in a retail store or a hospital or whether it’s on your website. Pretty simple – this is what you told us, this is what we’re doing about it, we’re committed to serving you and oh, yeah please take 30 seconds the next time you are with us to once again let us know how we did today. That’s how you lock those two loops in place and start seeing 50, 60, 70% of customer participation.

Joseph: Let me make this really tangible. If you could take an example from any customer/client you’ve worked with where the feedback that they received somehow was worked upon and was utilized not only to rescue maybe a single customer for whom they had actionable data but really had an impact on the way in which service was delivered. Is there anything that comes to mind that might cause a reader to say, “I want to invest in these mechanisms because it allows us to have breakthrough opportunities in improving the patient/customer experience?”

Gautam: So there’s two sides – there’s do we have the data and what do we do with the data? So to come to the listening side I can tell you across the base of hospitals – we look at that rounding process. I can tell you there’s direct correlations in the healthcare world between the movement of the HCAHPS score which is tied to reimbursement – a very, very clear line of sight to dollars the rounding process. If one can get the rounding process right – there are three components that make it successful. Quantity of rounding – how many patients are you touching on a daily basis? How many patients are you checking in on a daily basis? Quality of rounding – so what is that interaction like? Is it just a check list? Are you just going in and saying yeah you’re right? Okay, good, fine. Or is it building a relationship? Then the third is doing something with that information.

What I can tell you is across the base of organizations with whom we have worked, we have seen more than 130% increase in the number of patients that they are able to touch with the rounding tool and a resulting measurable impact and improvement upon the HCAHPS scores.

In one scenario where we’ve been in for eight months, 275 detractors had been moved from to promoters by the next visit through appropriate follow-up efforts. So there’s really multiple ways you can look and measure. So it’s taking revenue and risks like in that detractor situation – reimbursement at risk and being able to convert it into someone who would now not only use your service again if they had a need but would also be willing to recommend you to a friend or family member that would have a need. So there’s lots of different ways to look at this.

There are great stories about people within hospitals that wanted to check themselves early. Without having some proactive mechanism to find out why- patients were distressed about non-medically related issues that affected their stay. In one case, someone from the hospital actually went fed the dogs of a patient, that type of intervention would not have occurred without frequent listening and rounding. So the stories range from clear financial metric success to amplifying the voice of the patient to even scenarios where we’re capturing stories.

Assessing the Voice of the Customer – Interview with Gautam Mahtani

Today on the blog, I feature the first part of an interview with Gautam Mahtani, Loyalty Strategist and Co-founder of Customer Feedback Systems….

Joseph: Welcome to the Michelli Experience Blog. I’m honored to have as a guest with me Gautam Mahtani who has mastery as it relates to assessing the voice of the customer. Increasingly as I go around the world, I see businesses struggling to figure out how to measure what customers think of the experiences the businesses deliver. If we can’t understand our customers we can’t innovate solutions to meet their needs. Gautam, please tell the readers about your background as it relates to customer assessment…

Gautam: Well Joseph it’s an absolute pleasure. I appreciate it. You know – our organization long before government regulation in healthcare, (HCAPs and these things) put a spotlight on the voice of the patient and also long before tablets, iPads, Androids and even great email information was available to capture the voice of the patient and the voice of the customer. We’ve worked in hospitals and clinics in the US, around the world, on the ground with a cute little device that we had that collected real time feedback at the point of care. What that does is it creates an opportunity to capture in the moment how a patient is feeling. We have found over the years as technology advanced and caught up to that funny little box that new opportunities were created. We know patients/customers want you to make it quick and easy for them to communicate with you and there’s an amazing opportunity not only in how we collect information but the ability to feed that information to the frontline for learning and planning. The ability to feed that information up to leadership so they can look for opportunities, risks, and most importantly where they can clear the path. The one caveat here is in this day and age if these real time – what we call high velocity feedback loops – take on a traditional, punitive patient and customer satisfaction role, if they look and smell and feel like the feedback will result in punishment to staff those staff members will reject it. Then you lose this amazing opportunity to get that operational intelligence. Fortunately, we have found solutions and strategies that allow us to capture 60-70% of patient feedback. And that’s not 60-70% of a 10% sample, Joseph, that’s 60-70% of patient visits. That information becomes the fuel for organizational and patient/customer-centric growth.

Joseph: So before we even get to how administrators use the information or whether it’s actionable let’s go back a step. There are many ways to ask customers about how they feel. Or patients about how they feel. There’s obviously the opportunity to have some external agency come in and call your customers after they have had some interaction. There’s the opportunity to give them an IVR on a receipt with a code, if they call in, if they self-select to do so. You can send out an email link for feedback after a service encounter. Talk to me about the different methods. I know you deploy a strategy that captures the input of customers in the moment, right at the point of transaction.

Gautam: So there are all different kinds of modes of collection. As you mentioned we’re big advocates of point of care but certainly email is a format that when done correctly can garner some very, very interesting information. It tends to happen a little bit more after the fact. But in some cases there’s nothing wrong with that and it actually can be advantageous. Historically organizations looked at expensive techniques such as phone, such as mail and those typically garner much lower participation from customers and patients and kind of fall into that bucket of the traditional lag measure – that thing that just looks and feels so important but in reality is very difficult to affect. So what we’re seeing a lot of organizations doing now is move to something that’s more measurable, more in the moment – asking questions that have very specific criteria. So if it’s not important to the patient and it’s not actionable by the staff there’s no point in really asking it. So we’re seeing more of a shift to what we call again these high velocity feedback loops. If you ask me, I think measurement is moving closer to the service experience and then obviously to social – unstructured data, social environments. Unstructured data in general – now we’re beginning to see the early instances of sentiment analysis and things that can actually take that unstructured data and present it in a meaningful way. Previously we never saw that – so that in itself is proving a lot of great opportunities these days.

Joseph: It is using technology like yours which involves using tablets so customers can quickly and non-otrusively offer feedback at the point-of-service or the point-of-care. In this method they are being asked, how did this interaction go? Overall how did I feel? How likely am I to recommend? All those things that we’ve been talking about over the years as important to customer loyalty – they can rate all that instantaneously and very quickly.

Gautam: That’s right. There’s always been two reasons, Joseph, that patients and customers don’t give feedback. Well, I’ll argue now there may be a third that we’ve uncovered, not alone but just through conversations with the organizations we have the privilege to work with. So number one is inconvenience, time consuming data collection. The traditional 30, 40, 15 question survey – whatever it may be. Sending in the mail, send it in a phone call in the middle of my dinner. So number one is inconvenient time consuming mechanisms of collecting. That’s easily sidestepped these days with a little bit of technology and a little bit of discipline around question design. The second reason that patients don’t give feedback is that they never believed that, the organization intended to do anything with that information anyway – so why bother. So that’s also addressed through communication. It’s addressed through number one, service recovery. When a patient or customer expresses dissatisfaction we do something about it. You would say that’s pretty obvious but we’re not seeing a huge outbreak of really robust service recovery processes in place that make it easy for the staff to do something. We don’t see that. We’re big advocates of that. I say the final reason that we don’t get – maybe in this case – the most honest feedback is fear of retribution. That could be from a staff member, it could be from a patient – and again addressed through communication and addressed through creating an environment – we call it rewarding complaints. We looked across the organizations that we work with and we try to find out why some are so great at taking high velocity feedback back to technology and achieving the business goals verses others where it just becomes the annoying thing for staff to do. And we uncovered eight principles of success. It starts with the leadership team and their position that this is not a traditional survey program. This is something quite different. Our organization exists purely to empower staff and better serve patients and customers. It exists purely to uncover and remove the roadblocks that are getting into the path’s way. That’s it. And when you get that right and you’ve got leadership involvement it’s an incredibly powerful thing.

Stay tuned for the next installment…

How to Grow Your Customer Connection Through Technology

In a Time magazine survey, people were forced to choose one item to take to work: their wallet, their lunch, or their mobile device. The result: 66 percent chose their mobile device over their lunch, and 44 percent chose their mobile device over their wallet. In the same study, 68 percent of adults report that they sleep with their mobile phone next to them, and 89 percent say that they couldn’t make it through a single day without using their mobile device.

This may not take you by surprise.  The tiny computers that we are rarely without have become central to our lives and our businesses.  In my book Leading the Starbucks Way I identify a principle I call Mobilize the Connection, as Starbucks has become a recognized leader in digital platforms, social media engagement, and innovation. For instance, Starbucks was selected by Forbes as one of the top 20 innovation companies.  The Starbucks Card mobile app even received the Wireless Application and Mobile Media (WAMM) award as Best Retail, Shopping and Commerce Application.  This week it just got better.  The much-anticipated update to the Starbucks mobile app is here…well, for iPhone users, that is.  (Android users, your upgrade is said to be slated for later in the year.)

Technology is powerful when you view it as a way to enhance the human connection rather than seeing it as inevitably leading to impersonalization.  Starbucks’ understanding of this is evident in the new digital tipping capabilities featured in the mobile app upgrade.  When the app is used as payment, patrons now have the opportunity to add a tip up to two hours after their purchase.  Suppose you’ve just enjoyed the best white chocolate mocha of your life and want to tip the fine barista responsible for such perfection.  Now this is possible from your phone – even if you are out of cash and perhaps have long ago left the store or drive-thru at which your purchase was made.  Customers celebrate the connection between themselves and the Starbucks partners that they interact with during their visits, resulting in an enviable level of brand loyalty.  Tipping in food service is an expression of that connection and gratitude.  Through the strategic use of technology this gesture moves beyond the antiquated tip jar into 2014.

Technology may be something that you should not view as being provided for just “users,” but instead should be seen as a tool for serving and connecting with your “people” and your “customers.”  Even better?  Use technology to connect your people WITH your customers.

How to Create Sustainable Customer Excellence: The Power of an Acknowledging Leader

We have talked about the power of being seen, truly seen, as one hallmark of an exemplary customer experience. But to see, listen to, understand, and serve your customers may not be your role day-in and day-out. Perhaps you have a team that more directly interacts with customers or a front-life staff whose job it is to engage who comes through your doors. Let’s talk about those people and how you can inspire and empower them.

While most of us intend to recognize the achievements of our team members regularly, those intentions often get lost amid the deluge of challenges and demands that we face every day. By creating effective reward and recognition programs, great leaders develop recognition excellence as a core competency within their organizations. In their book The Carrot Principle: How the Best Managers Use Recognition to Engage Their Employees, Retain Talent, and Accelerate Performance, Adrian Gostick and Chester Elton suggest, “In response to the question ‘My organization recognizes excellence,’ the organizations that scored in the lowest fourth overall had an average return on equity (ROE) of 2.4 percent, whereas those that scored in the top fourth had an average ROE of 8.7 percent. In other words, companies that most effectively recognize excellence enjoy a return that is more than triple the return of those that do so the worst.” Similarly, Gostick and Elton found that managers who were rated highest on recognizing employee contributions also typically produced the highest levels of employee satisfaction, employee retention, and even customer satisfaction.

Because of the importance of recognizing excellence, leaders at companies like Starbucks have developed a broad array of recognition and award programs.  The diversity of offerings affords a number of important teachable lessons:

  • The value of peer-to-peer recognition
  • The need to scale rewards at both the individual and team levels
  • Reliance on social aspects of recognition
  • The enterprise-wide importance of rewards

Many of the reward programs offered at Starbucks involve nominations from peers and/or direct and immediate recognition by peers.  Rather than relying only on managers or leaders to catch people who meet the criteria for recognition, the entire organization is mobilized to immediately, or through nomination, bring those acts of excellence to light.  Similarly, excellence is recognized in terms of both individual effort and team collaboration at Starbucks. In the course of my function as a professional speaker, I have attended a large number of sales conferences, award banquets, and even service recognition events. It is rare to see awards provided to groups at these events.  While individual awards can foster healthy competition within an organization, they can also undermine collaboration. Balancing individual and team recognition allows both independent and interdependent excellence to be acknowledged at your company.

While some businesses get caught up in high-cost extrinsic rewards and bonuses, most of the awards offered at companies like Starbucks do not involve items with substantial tangible value – think pins, handwritten notes, or certificates to acknowledge their achievement. (For more on this check out my latest book Leading the Starbucks Way). Consistent with trends in social psychological research showing that extrinsic rewards can extinguish intrinsic motivation, the emphasis at of great leaders is much less on prizes and much more on acknowledgment.  As it turns out, it is not just customers who need to be truly seen.

Go forth and provide uplifting moments for those who uplift your customers!

The Big Question – What’s Next For Our Business?

Growth and expansion are provocative words in business.  They suggest all things good, abundant, and forward-moving – more revenue, more brand exposure, more leverage and influence.  When seasons of success accumulate under your belt growth often feels like the next logical step, much like marriage after a long courtship.  Yet, whether your business is big or small, pursuing meaningful growth can be a challenging endeavor.  From risk assessment and investment to consideration of culture and consistency of experience, expansion is wrought with challenges that can obscure the potential benefits.  After all the analysis involved you may find yourself wondering: do we really want to do this?

Thom Breslin (director of design, Starbucks UK & Ireland) purports that failure to “innovate, renovate, and constantly seek relevance” leads to corporate death.  (Well that’s certainly not what we want!)  To help your business frame the enormity of the conversation surrounding the question “what’s next?,” here are some realities to jumpstart your thinking:

  • Leaders look for ways to be where people are and not make customers seek them out.
  • In an increasingly competitive marketplace, it is essential that you experiment with bold concepts to keep your brand fresh and determine what new ideas resonate in the communities you serve.
  • Maximized choice is essential to today’s global consumer, but with choice comes a responsibility to ensure that you can execute your new product offerings at a level commensurate with your existing levels of excellence.
  • Observe your customers, then adopt, adapt, and extrapolate new ideas that will connect both locally and globally.
  • Internationally, people have many common needs, but culture affects how people will want to connect with your brand.
  • Store design must have functional and local relevance to the communities served, as should the products offered in those settings.

In my newest book, Leading the Starbucks Way, I share a business principle that I refer to as “Reach for Common Ground.”  That is, to respect, celebrate & customize while listening and innovating to meet local, regional, and global needs.  When next you find yourself casually traveling through Switzerland, be on the lookout for the Starbucks train car café that runs at 120 miles per hour.  This concept café brings new meaning to “mobilize the connection” and embodies the painstaking detail and care that is often required to leap into a new market or engage customers in a unique way or place.  The Seattle Times reported that it took nearly two years to transfer the Starbucks experience as we know it to a train car moving at such speed.  No stranger to thinking in an outside-of-the-box fashion when it comes to growth, Starbucks sought relevancy by bringing that “third place” to where customers already were.

If Thom Breslin is correct, what is your business doing to stay alive and thrive in new markets?

Getting Personal: It’s NOT Just for Valentine’s Day

Having the products and services your customers want and delivering them consistently is merely table stakes today.  The real challenge is whether you get personal with customers!

Let’s face it, we live in a service economy and are surrounded by service providers.  Yet, oddly, we often feel that we are woefully underserved or worse – completely unnoticed.

In my latest book, Leading the Starbucks Way, I explore the common personal connections sought by customers and the undeniably powerful way that Starbucks appeals to those unifying, universal truths.  “As Jean-Marie Shields, director of Brand Strategy, at Starbucks, notes, ‘The number one request or desire of every human around the world is to be seen and heard. The magic of the Starbucks brand comes from a willingness to actively see and hear our customers on many levels.’ At the individual service level, for example, the “seeing” and “hearing” aspects to which Jean-Marie refers come with an initial greeting that acknowledges a customer’s presence and starts a human connection. Karen Joachim, a customer from Albert Lea, Minnesota, notes, ‘Quite often when I buy something, I feel invisible. Starbucks is a different story. They actually make a momentary but noticeable connection.’”

Have you ever had a service experience so compassionate and caring that you had to share it with someone? (Probably on Facebook.)  You most likely walked away having been acknowledged in such a real, organic way that you felt understood and valued.  Starbucks knows that each customer is more than just “a tall latte” and “a grande nonfat mocha.”  They’re Scott and Pam, each of whom have preferences and nuances worthy of being recognized and remembered.

Getting personal starts with genuine attention and an interested spirit.  The person you are about to interact with is just that – a person.  You both carry burdens, you are both likely overextended, perhaps overwhelmed, – but here she is – at your counter, on the phone, inquiring on your website.  The compassion and caring involved in acknowledging her as a person rather than “just another customer” creates a split-second connection that sets the tone for her experience.

Authentic personal interest fosters customer engagement and loyalty. Efficiency, accuracy, and the myriad of other things we value in a service exchange are even more influential when we, the customer, have been truly seen…and not as an interruption or a problem but as a truly “BELOVED GUEST.”

How to Get a Solid Return on Workplace Fun

It happens in many places and in many ways, but it is a consistent theme for employees at Zappos…they practice random acts of fun and weirdness.

Maybe you were in an airport during the hectic holiday season when seven different flights participated in a Zappos-themed game of Wheel of Fortune…baggage claim style.  If your luggage came down the chute and landed on a prize, the prize was yours.  Apart from the noble desire to surprise and delight their customers, who else benefited from this exercise?  Zappos employees of course!

In my book The Zappos Experience – 5 Principles to Inspire, Engage and Wow I introduce the leadership concept – Play to Win.  Play doesn’t seem like a necessity for grown-ups and in fact may be something that happens “when” everything else is accomplished.  Trouble is, if your business operates like most, you never reach the end of that infinite to-do list.  Alas, the fun never gets had.

But chew on this:

  • Individuals who have fun on the job tend to be more creative and productive.
  • People who are having an enjoyable time on the job tend to have more positive relationships with their peers, make better decisions, are less tardy or absent and use fewer sick days.
  • Innovation emerges from casual contact between diverse work-groups.
  • Brief bursts of workplace fun can be an inexpensive, energizing force that   increases team alignment, solidarity, and productivity.
  • Play and fun can be infused into, and are often most needed for, routine tasks such as evacuation drills.

Zappos has what I refer to as a R.O.F.L. culture.  R.O.F.L., as an Internet acronym, stands for “rolling on the floor laughing.”  But for Zappos I suggest that R.O.F.L.  stands for “Return On Fun Lasts.” Zappos may be the best example of an often under appreciated truth – a small investment in workplace fun will produce tangible and profound benefits for your staff, customers, and your brand’s equity.  What did this airport shtick create? Impassioned employee and customer evangelism.  How FUN must it have been to deliver happiness to unsuspecting people who were probably just trying to endure the day?  And how FUN must it have been to be those people who received something awesome in an unexpected place?

In the spirit of Zappos, how are you facilitating playful fun into your businesses culture?

Guest post: PHENOMENAL Marketing Systems by Howard Partridge

For about a decade I have been blessed to work with and for Howard Partridge, president of Phenomenal Products. In fact, this year I will be one of the presenters of a leadership master class with Howard and:

John Maxwell the category-creating leadership author of more than 60 leadership books, as well as

Michel Gerber the cutting-edge author of The eMyth

Since today Howard is launching a new book – 5 Secrets of a Phenomenal Businessand given the quality of this guest blog, please allow me to share the gift of Howard Partridge….

PHENOMENAL Marketing Systems

by Howard Partridge

What comes to your mind when you think of the word marketing? For some, it’s advertising. Others might think of networking, branding, or the idea of “getting your name out there”.

Of course marketing includes those things, but marketing is actually everything you do to attract prospects to your business. Phenomenal marketing delivers a meaningful experience that educates, engages, and entertains. A phenomenal marketing system is a group of working parts that duplicates results consistently.

What kind of results?

Enough of your perfect target prospects to reach your sales goal consistently. A phenomenal marketing system consistently produces your perfect target prospect.

If you are attracting the wrong kind of prospect, your marketing isn’t working. And if your sales are up and down because you don’t consistently implement marketing, then you don’t have a system.

Too many business owners spend lots of time and money “getting their name out there” but have no real system of attracting prospects consistently. Most often, a small business owners marketing is a gamble more than a planned effort.

Regardless of the type of marketing you do, it must increase sales. Of course the sales process will determine whether the prospect will actually buy, but that also depends on the quality of the prospect you are attracting.

When you attract the wrong kind of customer (because your marketing isn’t what it needs to be), it doesn’t matter how good your sales process is. You may even close the sale, but you won’t build the kind of business you want.

The Only 3 Ways to Increase Sales

Regardless of the type of business you are in, there are only 3 ways to increase sales under the sun. The 3 ways are…

1. Increase Sales from Existing Clients. The first way to increase sales is to get your existing clients to use your service or buy your product more often, or to take advantage of additional products and services you offer. It is estimated that it costs an average of 500% more to gain a new client than to keep an existing one.

2. Increase Number of Clients. The second way to increase sales is to get more clients, customers or patients. Most small businesses say that 85% of their business comes from repeat and referral business. Yet, they don’t have a system in place to maintain and increase repeat and referral business.

Most small businesses say they build their business through “word of mouth”, but they don’t have a referral system in place. There are many ways to get more clients, but the best way is through referrals and in my book I show how to put your word of mouth marketing into a phenomenal system.

3. Increase Price. This is a powerful way to increase sales, but probably the last one that small business owners think of, because after all, “with the economy being what it is…”

By positioning yourself and your company differently – by creating a different experience, you’ll be able to continually raise your price. If you increase your price by 20% and lose 20% of sales volume, you’ll still make more money. As a small business, this is an important concept. You are probably working to long for too little. You can work less and make more.

The beauty is that you probably won’t lose any sales volume. If you do, it’ll be the unprofitable ones you don’t want. And if you do this right, you’ll quickly replace them with clients that are willing to pay a higher price because you’ve developed a compelling experience they want.

If You Don’t Have Passion for Your Product, Why Should Your Customer?

It’s a nice daydream, right? Feeling, or better yet, actually being ahead of the game? Sometimes trying to get on top of all your day-to-day business realities seems futile at best. At the end of the day you may feel more like a firefighter and less like a business owner or leader, managing the emergencies that occur even on the most “ordinary” days. All this reacting can make you feel like you’re merely surviving instead of thriving. When in survival mode things like strategic planning and creatively mending patterns of breakdown experiences fall by the wayside. In the madness of trying to stay above water, proactive thinking just doesn’t happen. Well let’s take a breath and at least consider the importance of positioning product passion into our businesses.

Principle 1 in my book Leading the Starbucks Way is Savor and Elevate. Can you imagine how different our lives would be if most business owners worked to infuse product passion into their entire workforce? What if those owners also believed it was their job to improve or elevate the products that they touch? How would your next visit to your dry cleaner, post office, electronics store, or supermarket be different? Better yet, imagine how your customers might feel if all your people were passionate about your products and felt responsible for elevating them with each touch.

It comes as no surprise that constantly reacting to your environment and circumstances is draining. But connecting your people to passion for your product or service is a life force. When we are passionate about something we not only find energy but we delight in sharing our enthusiasm with others.

What is one way that Starbucks works to foster this savor-and-elevate spirit, a spirit of passion if you will, into their culture? Rituals. For some people, the word ritual tends to conjure up images of religious or personal behavior; however, S. Chris Edmonds, a senior consultant with the Ken Blanchard Companies and co-author of Leading at a Higher Level, defines corporate rituals “as events which communicate and reinforce desired performance and values.” Chris believes, “Few senior leaders leverage corporate rituals as an intentional strategy to define and reinforce a company’s desired culture.”

Corporate rituals are powerful ways to create a common bond, inspire commitment and innovation, and build an integrated and effective culture. Authentic corporate rituals also define unique aspects of your culture and reinforce your business’s broader purpose, particularly when those rituals are supported by enriched experiential learning and congruent business strategy.

At Starbucks a powerful corporate ritual involves starting meetings with coffee tastings – it celebrates coffee and communicates that coffee is at the center of the brand. It drives a constant exploration into the nuances of the rich palate of coffee offerings at the company. Unless you are selling coffee that particular ritual will not be relevant to you. What can you do to create a pattern of behaviors that define and reinforce your company’s desired culture and proactively connect your people to a passion for your products or services?

A Case Study for 2014 – Learning from Legendary Leaders

In the spirit of being lifelong learners this new year, and every year for that matter, let me share a new word  I learned recently:  holacracy.  I am assuming you may have see this word buzzing around the Web lately.

My connection to the word comes through Tony Hsieh CEO of Zappos. As you know Tony and Zappos were the sources for my book The Zappos Experience: 5 Principles to Inspire, Engage, and Wow and this year he and his team are making some rather large holacratic changes!

Holacracy has been best defined as a social technology or system of organizational governance in which authority and decision-making are distributed throughout a fractal holarchy of self-organizing teams rather than being vested at the top of a hierarchy.  Now that makes clear doesn’t it?

The term holacracy is emerges from the Greek root word holons.  Holons refer to units that are autonomous and self-reliant, but also dependent on the greater whole of which they are a part.  Thus, a holarchy is a hierarchy of self-regulating holons that function both as autonomous wholes and as dependent parts.

So Zappos is becoming…what, exactly?!  In essence, a much, much flatter organization.  News site Quartz reports that the company will be comprised of roughly 400 circles, or holons, by December 2014 when the reorganization is complete.  News stories about the announcement have headlined with the idea that there will no longer be titles or managers who wield or distribute power according to their relative positions on the ole’ ladder of success.

Columnist and author Irving Kristol once suggested that leaders need to define that “one big thing and stick with it. Leaders who had one very big idea and one big commitment are the ones who leave a legacy.”  When asked about a Zappos legacy statement, Tony Hsieh told me, “I hope that Zappos can inspire other businesses to adopt happiness as a business model — letting happy customers and happy employees drive long-term profits and growth. Ultimately, it’s all about delivering happiness.”

We as spectators have to assume that adoption of  holacracy is another means to Tony’s happiness-focused end.  When legendary leaders of our day announce plans to do mind-bending things, an opportunity emerges for all of us to watch, learn and grow together.

How will the customer experience post-holacracy change and improve?  What are the (albeit less dramatic) takeaways that your business can consider implementing to harness the benefits of a more entrepreneurial, employee-empowered structure?  How do companies (even those with exemplary cultures) overcome obstacles, forseen and unforeseen, as they persist in their efforts to achieve an unorthodox and empowering vision?

Cheers to 2014 and the wellspring of answers and insights to come!