Executing the 100 percent promise
Winning companies never disappoint their customers, because they deliver 100 percent of their promise 100 percent of the time. Dr Mike Ashby explains. I came across a great idea in the book What Really Works, by William Joyce, Nitin Nohria and Bruce Roberson. They studied thousands of public companies to understand what made them ‘winners’ […]
Winning companies never disappoint their customers, because they deliver 100 percent of their promise 100 percent of the time. Dr Mike Ashby explains.
I came across a great idea in the book What Really Works, by William Joyce, Nitin Nohria and Bruce Roberson. They studied thousands of public companies to understand what made them ‘winners’ over a long period of time, and how they were different from ‘losers’ (they had a reasonably robust kind of methodology behind how these were classified).
Their conclusion was that there are four primary management practices that companies must excel in as well as any two of the four secondary management practices (4+2).
A company consistently following the 4+2 practices had a 90 percent chance of being what they called a winner (and they had a tight definition of that). Most of the other 200 practices were irrelevant to the return to shareholders.
The four primary practices were to:
- Devise and articulate a strategy that is clear and narrowly focused.
- Execute flawlessly – consistently meeting (but not necessarily exceeding) customer expectations.
- Build a culture that is intensely performance based and oriented.
- Be fast and flexible by having a flat organisational structure.
Each of these is worth an article, but I want to focus on flawless execution – superior execution of basic skills.
Their finding was that winning companies never disappoint their customers. They deliver products and services that consistently meet customer expectations – they don’t exceed or delight their customers, they just deliver what they promise.
That means that they deliver 100 percent of their promise 100 percent of the time. This is the mastery benchmark. It’s not bells and whistles, fancy packaging or clever strategies. It’s delivering exactly what the customer wants every single time. Not most of it, almost all the time. And not more than they asked for sometimes and the rest of the time almost.
I really like this concept. It’s obvious that if we consistently underdeliver on expectations, we are going to struggle to keep our customers (unless we have some other lock-in advantage). And if we deliver on expectations but only inconsistently, we’re going to frustrate our customers, so they won’t give us referrals or new revenue opportunities.
Great customer relationships – great relationships of any kind – are built on trust and integrity. Do you do what you say you’ll do? Deliver in full, on time, every time?
In lean manufacturing terms it’s referred to as DIFOTIS — Delivered In Full, On Time, In Spec.
Less obvious, but to me just as important, is making sure that we do not exceed 100 percent of the promise.
This is slightly counterintuitive: we’ve all heard about underpromising and overdelivering, delighting the customer, exceeding expectations, etc. The reality is that you could exceed expectations but still not create value; you might give me 105 percent of what I expect, but I wouldn’t pay you for the five percent if you asked me to, so I don’t value it. But it costs you to deliver the last five percent, and a cost that can’t attract revenue comes straight off the bottom line.
Perfect quality means perfect fit for purpose. It doesn’t mean the best possible.
The consistency bit is essential: delivering 105 percent of the value this time and 95 percent next time is not the basis of a long-term customer relationship based on trust and consistency. It’s a highly demanding benchmark. It requires:
- Clarity of vision and purpose (the value we add for the customer).
- Strategies that reflect a focus on our area of greatest opportunity.
- Deep customer connection, enabling us to understand what 100 percent of the promise looks like to our customer and to evolve our offering just ahead of our customers’ need for it.
- Always looking to improve our processes so we are delivering on the promise 100 percent of the time.
- Developing and evolving a culture of customer connection.
- A leadership team committed to this standard throughout the organisation.
Consistency like this has to be a way of being. You might call it ‘Business As Unusual’ given how rare and challenging it is, because it requires effort way over and above the simple transactions that constitute customer satisfaction. Above all else it requires all of us in the organisation to think: how can we do this better?
That’s the question that gets asked in that nirvana of business, the self-regulating performance culture (what we call mastery). This is where our staff take responsibility for improving the customer experience in a way that benefits the company as well. This is where our people find things that work well and make them work even better. This is where our teams give us bright ideas, fearless feedback and an occasional call to a higher standard of accountability.
This is where we all believe that we can do better than this.