December 11, 2019 - C-Suite Network™

The Case of Starbucks

Starbucks learned the hard way that their own people can act based on fear, marginalizing an entire group of the human population. Starbucks found out that these actions can reflect negatively on an entire company that relies on everyone, not only a single group of people, for its image, reputation, and ultimately its profit!

Starbucks can’t survive a boycott by those offended. There’s a huge business message to be learned here—People vote with their money. And when a business marginalizes someone, that person will no longer vote in support. We admire Starbucks’s effort to take responsibility by starting a sensitivity program that addresses the issue at hand. But it’s still in their own best interest to do so.

These days, events of this nature can quickly go viral, and dramatically affect business. This startling reality has businesses thinking about their employees’ mindsets and how they represent the company. Hiring based on skills is no longer enough—someone’s mindset can turn business away!

Prejudice in Politics and Business

We’ve made a lot of progress since the Civil Rights Movement’s early days, but the behavior of our top elected officials has led many people to act on their deep-seated prejudices. These people feel that their actions are justified—that they have permission to marginalize others. They see powerful politicians ridiculing, dehumanizing, name-calling, and disrespecting entire groups of the population solely based on religion, race, or national origin—and some people follow this example.

ABC learned this lesson the hard way. After Roseanne Barr’s degrading tweet about Valerie Jarrett went far from unnoticed, ABC was forced to either cancel her program or face protest from advertisers who depend on sales to the whole market, not just one group.

This brings us to the double standard that exists in society today. Unfortunately, it’s “okay” for a politician to make remarks that marginalize people, but not businesses. Businesses are held to a much higher standard of respect, as far as the general public is concerned. It’ll take years for elected officials to be voted out. But Starbucks or ABC? You can vote them out tomorrow!

There’s Good News and Bad News

The bad news is—despite how far we’ve come, fear, prejudice, and stereotyping are all prevalent in our society, with some people going as far as to take action on their prejudices. Maybe they choose to follow news feeds that support their opinions. Maybe they want to take steps backward. Or maybe they truly believe that society is becoming more and more intolerant.

But, the good news is that most businesses have to serve the entire population. Unlike political figures, businesses can’t cater to a small base. Their advertisers, suppliers, and customers hold them accountable for each of their employees’ behavior. Now that we think about it, businesses that want to see everyone as a potential customer have become unintended defenders of civil liberties.

We say, “If you really want to change something, put a buck on it!” Oppressed groups, like LGBTQ+, Latinos, and African Americans, among many others, have become influential economic forces to be reckoned with. Employee sensitivity training may begin by addressing why we depend on one another, how our very existence stems from people of all backgrounds, and why our paychecks rely on each person’s patronage.

If we started thinking of everyone as a customer, maybe we would treat them with more respect. There’s no denying that minorities have financial clout. If one group is marginalized, another group may be next. Simply put—it’s bad business to allow prejudice into the market, period. Don’t ever bite the hand that feeds you!

For more, read on: http://c-suitenetworkadvisors.com/advisor/michael-houlihan-and-bonnie-harvey/

If you don’t know what “being customer-focused” means or can’t measure it, you can’t know if you’re doing it. Many company leaders desire customer focus. Fewer know exactly what that term means. Fewer still can describe specific behaviors to know how far they’ve progressed on a journey toward customer focus. Let’s fix that in this article.

The term “customer focus” is too vague to measure accurately. Let’s correct our target term to customer-perceived value. Perceived value is what drives customer decisions. Perceived isn’t just a throwaway word: value only exists in the customer’s mind, and elite organizations don’t take chances with what is/isn’t perceived by a prospect. Thus, customer-perceived value (I often shorten it to just “value” because there isn’t any other kind) is the core idea — the essence — within the cruder “customer focus”. Value is the axis around which everything in your organization should move.

Your first task in grading your company’s “customer focus” is to use a measurable target.

Refine your focus to “customer value”.

Value is the desirability of customer outcomes. Customers buy outcomes, not our products and services. What they are willing to pay – value — depends on the desirability of those outcomes. Desirability can be measured in dollars.

As you focus on value, your journey takes place in three domains, described below.

For starters, let’s grade your performance using three levels beyond “average”: Good, Great, and Elite. I’ll be detailing what Good, Great, and Elite look like in three upcoming articles, one for each domain. If you can’t wait, contact me, because those articles are already (mostly) written. I’m also developing an assessment tool, which will be on my new website (a shameless tease for coming attractions).

Below, I want to describe the three domains:

1. How well is your organization aligned around Value

Alignment between departments amounts to de-siloing your organization. I’m all for developing robust expertise in many specialties, but it is an established anthropological fact that silos also create gaps for important stuff to fall through. There is a constant push-pull between specialization and holistic/systems thinking in any organization. Alignment is the process of purposeful coordination between silos.

Companies usually start by aligning islands of functions…say, sales and marketing…then maybe customer service. In elite value focus (aka Radical Value focus, the title of my upcoming book) everyone wants to uncover new/better customer outcomes to increase value.

Customer experience (aka CX) management follows a similar track. Radical not only means everyone delivers value but is constantly seeking additional customer’s -mind insights

2. How Well Do Your People Build, Sell and Price customer value?

This is the domain of customer engagement. As you progress from “good at sales” to “elite value-based seller”, the skills deepen, and the number of people in the organization participating widens. I use three key components of the selling process to describe value-based selling:

Build: Uncovering and discovering value gaps, expanding them, and causing the customer to envision outcomes of having those gaps resolved.
Sell: Aligning the seller’s solution with desired customer outcomes.
Price: Facilitating the customer process of monetarily measuring the desirability of outcomes, then conducting a win-win pricing dialogue.

Elite performers, those who have radical focus, are able to execute sales at more profitable value-based pricing.

How Well Do You Enable Everyone in the Organization to Perform at an Elite Level?

Enablement consists of hiring, training, coaching, and content services. Maturity level increases with the number of services, who is included, and breadth/depth of service. More importantly, maturity increases with transitioning from event focus, to process-focused, to closed-loop process.

Event might mean train and coast, or coaching “burst”, then coast.
Process looks like ongoing training; developing a coaching cadence.
Loops close when coaching drives changed training when sales insights are captured for improved content and product innovation. The more loops closed, the more elite.

One way the journey starts is when a company realizes that front line sales managers performing as “super salespeople” or “deal saviors” doesn’t scale — or build bench strength — nearly as well as coaching everyone to save their own deals. Another key indicator of maturity is the organization’s discounting process and behavior, from subjective/”squeaky wheel” management to objective, value-focused and tracked/analyzed

Research Backs This Up.

CSO Insights (CSOi) has defined 12 behaviors of great companies (their term: “world-class”). “Great” organizations practice all 12. I’ve organized the 12 behaviors into these three domains. (Source: CSO Insights’ 2019 Sales Best Practices Study)

The difference between CSOi’s results and the elite behaviors I’ll be sharing in coming articles: CSOi never even asked about elite behaviors, and thus never correlated elite behaviors to results. The CSOi 12 behaviors figure prominently in the good and great levels of value focus, but are largely absent from the elite level.

Do you want to win more opportunities than most? CSOi’s results show that practicing these 12 behaviors correlates strongly to that type of outcome.
Do you want to win with higher customer preference? CSOi didn’t ask; their results are silent here. It neither corroborates nor refutes that higher perceived value correlates with higher preference. Other research (and common sense) will back this up, though.
How about winning with higher value, driving deeper customer relationships? CSOi didn’t ask. Other research declares this a worthy pursuit, however.
Selling at higher win-win prices? CSOi didn’t ask. There’s a sad story, here. Ask me about it sometime.

I Want More for You. Radically Elite Value Focus.

These are the three domains for a journey to elite value focus. In follow-on articles, I describe what makes up good, great, and elite performers.

Comment below, like, and/or share. As I said, reach out if you have more in-depth questions, or read the next three articles.

To your success!

Quick links

Follow Us