Progressing to SD-Logic Thinking

Joseph Michelli, author of Leading the Starbucks Way: 5 Principles for Connecting with Your Customers, Your Products and Your People is tomorrow’s podcast guest and like all his books he bases them around five principles. This is Michelli’s second book on Starbucks, the first one was The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary. In the first book, the five principles were…

1. Make It your Own
2. Everything Matters
3. Surprise and Delight
4. Embrace Resistance
5. Leave your Mark

In one of my highest rated blog post, Is Zappos the Next Toyota?, I discussed the The Zappos Experience: 5 Principles to Inspire, Engage, and WOW. The Zappos principles were…

1. Serve a Perfect Fit—create bedrock company values
2. Make it Effortlessly Swift—deliver a customer experience with ease
3. Step into the Personal—connect with customers authentically
4. S T R E T C H—grow people and products
5. Play to Win—play hard, work harder

The first Starbucks book was written about 10-years ago and the Zappos book two years ago. As you can see, the progression of the principles from a focus on operations to customer experience. In his new book, Leading the Starbucks Way, I asked the author about the new set of five principles.

Joe: In all your books, you frame them in a certain way which I really like. You base them on certain principles that companies can identify with. Could you start out by giving a brief introduction to the principles that you used in Leading the Starbucks Way?

Joseph Michelli: I'll be glad to. I think for me I have to kind of get it in bite size pieces. There is so much information when you're dealing with a company the size of Starbucks. If I can kind of comeback and pull the cameras back a little we can get on that, some of the principles that we talked about in this book are really kind of around focusing on product and making sure you can savor and elevate your product. They have to do with really extend employees so that the love and I know it can be a tricky we can talk about, but the love that you extend is a leader to your employees is something then that moves into the life of the customers.

We are talking about mobilizing the connection in this book. The world has changed, and the notion that people are just going to walk into your store front or on to your page on online business is just not there. You going to have to go out and find where their lives are and mobilized your connection to make sure that you step into that space with them. There really is a principle in the book that really kind of looks at the importance of not just focusing on transaction or the customer relationship of the day, but really extending yourself out in the life of the customers by challenging your legacy, making sure that you have a lasting legacy statement that goes out into the customer’s space.

In the world which we live today there is a need to have a global of a connection with your customers as possible will also maintaining nuance for cultural relevance. So the business principles in the book are specifically dedicated to that and by name….

1. Savor and Elevate
2. Love to be Loved
3. Reach for Common Ground
4. Mobilize the connection
5. Cherish and Challenge your Legacy

The new perspective of these five principles is similar to many of the forward thinking companies today. We have progressed from operational to customer experience to Service Dominant Thinking (SD_Logic). This is where value is co-created. Delivering great experiences requires participation. We must engage our customers so that they are part of that experience and so much so that they may even take responsibility on delivering part of it. It is not a theater anymore. It not actors delivering to the audience, rather the audience and actors have joined together. For example, think about reality shows. Think about customizing your smartphones. It is the personalization of your experience that elevates it, and you savor the moment.

Where Strategy and Customer Service Meet, Part 2 of 2

John Goodman, Vice Chairman of Customer Care Measurement and Consulting (CCMC), has published scores of articles including “Using Service to Grow the Top Line” in the AMA Journal, 8 articles in Quality Progress as well as BrandWeek, the American Banker and Marketing News. Business Week credits John’s research for creation of the GE Answer Center, the original customer satisfaction contact center, as well as instigation of service initiatives at American Express, Coors and Toyota. The American Management Association published his book, Strategic Customer Service, in May, 2009.

John was my guest in the podcast, Where Strategy and Customer Service Meet, Part 1 of 2

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John will be presenting at the ASQ 2013 Service Conference. He holds a pre-conference on Sunday, October 6^th WKSP01: Using the Voice of Multiple Customers (VoC) to Drive Quality: Be Easy to Do Business and Monday’s  Session M04: Beyond the Buzzwords: Using Data to Enhance Loyalty and Service ROI. On Tuesday afternoon, I have the honor to be presenting at the same conference, Session T06: Lean Service Design.

Lean Service Design Program

Lean Service Design changes the way you think about business. No longer can companies focus their efforts on process improvements. Instead, they must engage the customer in use of their product/service rather than analyzing tasks for improvement. We no longer build and hope that there is a demand. We must create demand through the services that we offer and Lean Service Design is the enabler of this process. It changes our mindset of thinking about design at the end of the supply chain to make it look good and add a few appealing features. Instead, it moves design and the user themselves to co-create or co-produce the desired experience to the beginning of the supply chain.

The umbrella of Lean offers Service Design a method of entry into a well-established market. Lean has been very successful in Services and Design through traditional practices. However, we must move away from these traditions and institute a wider scope of Design to Services. This download contains a 130-page PDF book, workbook with forms, PDFs and training videos.

Table of Contents

• Chapter 1 – Lean (SDCA)
• Chapter 2 – Service (PDCA)
• Chapter 3 – Design (EDCA)
• Chapter 4 – Trilogy

In addition, for a limited time, I have included 2 popular eBooks from the Marketing with Lean Series:

1. Lean Engagement Team (More Info): The ability to share and create knowledge with your customer is the strongest marketing tool possible.
2. CAP-Do (More Info): What makes CAP-Do so attractive is that it assumes we do not have the answers. It allows us to create a systematic way to address the problems (pain) or opportunities (gain) from the use of our products and services.

But wait, you can get a CD with this same content free if you attend my presentation at the 22nd Annual Service Quality Conference, October 7–8, 2013 in Las Vegas, NV. The theme of the conference is 
Seizing the Competitive Advantage with Service Quality. REGISTER: Program details are now listed on the site. To or get more information, visit asq.org/sqd or call 800-248-1946. If you are from outside of the United States of Canada, please call +1-414-272-8575. Look forward seeing you in Las Vegas! Or, purchase the Lean Service Design Program!

Purchase the 130 page PDF for download, Lean Service Design  at a special price for the next 4 four days.

Lean Service Design Presentation at ASQ

I have the pleasure of participating in the conference and will be giving a sixty-minute presentation on Lean Service Design. My presentation will be building offering a unique perspective on applying Lean to the Service Design Field. All participants of my presentation will receive a CD that contains:

• 130 Page PDF eBook
• PDF & Excel work forms
• Training Videos
• Bonus eBooks and Audio Tracks

My discussion will begin with a discussion on Service Dominant Logic and go through the use of Stakeholder and Customer Journey Maps and Buyer Personas. We will use these 3 outlines to develop several service prototypes narrowing it done to a single choice. The Lean Process of moving from EDCA to PDCA to SDCA will be discussed in conjunction with the before mentioned processes. The last part of the hour I will introduce CAP-Do and the use (sorry for the pun) of User Personas and Scenarios creating a process that I call Persona Mapping.   

This ASQ 2013 Service Conference provides how-to’s, step-by-step advice, and the latest in service delivery methods and networking opportunities. Speakers will engage you on topics to help organizations improve customer service, reduce costs, and build both customer loyalty and satisfaction. Join us in Las Vegas for two days of networking and discovery.

22nd Annual Service Quality Conference
October 7–8, 2013 • Las Vegas, NV
THEME: Seizing the Competitive Advantage with Service Quality

REGISTER: Program details are now listed on the site. To or get more information, visit asq.org/sqd or call 800-248-1946. If you are from outside of the United States of Canada, please call +1-414-272-8575.

The Starbucks Way of Connecting with Customers

It is a lesson in strategic marketing that few books meant for that purpose can even come close. After reading, most of Joseph Michelli’s books, and doing a podcast with him several years ago, I concluded after reading Joe’s latest book, Leading the Starbucks Way: 5 Principles for Connecting with Your Customers, Your Products and Your People, that it is his best work to date.

From the forward of the book:

Each of Dr. Joseph Michelli's books offers a learning laboratory that's rich with examples from leaders as they address the aforementioned challenges and opportunities. They provide information, insights, and analysis on how leaders seek to create a high-performance organization that operates through the lens of humanity. This book demonstrates both the setbacks and the breakthroughs that the Starbucks leadership has encountered as it has attempted to position its products and people to deliver consistent, engaging, and loyalty-enhancing experiences.

Herve Humler
President and Chief Operations Officer
The Ritz-Carlton Hotel Company, L.L.C.

I have another compliment for Joe. There may not be a better interviewee that can make an interviewer feel that good about himself. At times, I had to remind myself who the “star” was. – My hat goes off to Dr. Joseph Michelli. 

P.S. When you find out Joe’s next book subject, you will be anticipating the arrival for the next two years.

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Lean Sales and Marketing: Learn about using CAP-Do

Cap-Do Audio Excerpt of Book

When we use our typical sales and marketing approach, we form an idea of the way things should be, forming maps or journeys that we want our customer to adhere to. As they get further along, we have so much invested that our manipulations get stronger. When they push back, we push back. When we apply what Stephen Covey said, “Seek first to understand,” we only do that for qualification purposes. Successful companies are destined to create the future of the outcomes with their customers. It is not incremental change or problem solving. It is not a prediction, it is what we think will happen.

We can only bring this about through challenging ourselves to first let go of our pre-determined thoughts and build structures based on possible scenarios. It requires experimentation, prototyping and the practice of learning by doing. This is not an easy process and one that requires a well structure outline. CAP-Do offers such an outline and will create a process of understanding and collaboration to help determine the future with our customers. In the Check and Act Stages leads to discovery of what we must attempt, experiment within the Plan and Do stages.

Enjoy the brief introduction of the book

 

 

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CAP-Do is included in the Marketing with Lean Book Series at no additional cost.

Is Starbucks a Lean Organization?

I asked that question of next week’s Business 901 podcast guest, Joseph Michelli, author of Leading the Starbucks Way: 5 Principles for Connecting with Your Customers, Your Products and Your People. I am a big fan of Joe’s work and had the pleasure of interviewing him about two years ago, The Zappos Culture Defined! about his new book at the time, The Zappos Experience: 5 Principles to Inspire, Engage, and WOW. This latest book, I believe is his best book to date. It is a lesson in strategic marketing that few books meant for that purpose even come close.

Joe: Does Starbucks consider themselves a Lean Organization?

Joseph: They like to think of themselves as a customer’s centric Lean kind of organization. Not a true manufacturing Lean where the efficiencies are driven essentially for the outcomes of the business. I think there's a lot of debate within you whole Lean community and you are far more of an expert than I am, but I can tell you that Starbucks would say they're Lean different than say "McDonalds is Lean. They have to figure out ways to build in the emotional relationship connection to customers as a value, not as a waste.

Joe: I think that is predominantly how I talk about Lean. How does Lean relate to the customer experiences? Is it just in the queue? Is it just in the handling of customers and doing it more efficiently?

Joseph: It is largely there. It is at the store level where a lot of labor and material cost are associated. The key operational challenge is to get that as efficient as possible to reduce the number of people you have to have on staff, to have the right staff in at the right time. To decrease the number of steps, to decrease the number of, actions that are wasteful. That's where the bulk of it happens it also happens in new product roll out making sure that there are repeatable processes that people have that makes for consistent delivery of product across the entire landscape. Beyond the brick and mortar store, I think the entire way that Starbucks runs its corporate headquarters has looked at Lean's principles to see what kind of processes are not officially being manifest within the organization. I think it’s gone beyond the customer facing dimensions and gone into the business processes. It is just becoming part of the culture. You know how it is though it catches fire, but it needs to continue to be kindled by somebody responsible and they've got the right numbers of people organizationally driving it throughout the organization, keeping it front and center.

In the book, Troy Alstead,CFO at Starbucks was quoted,

"As good as we were about spontaneity at forging human connections, we weren't as good at removing waste and creating processes that maximized efficiency and customer value while making it easier for partners to serve our customers. Over the recent past we have made great strides in these areas of discipline. So the idea now is to remove the things that really aren't critical to customer value. We shouldn't be putting our partners in positions of having to be creative with processes. Let's leverage their best practices that maximize efficiency for the partner and for the customer. Our partners should be encouraged to bring every bit of their creativity to how they interact with our customers, but quality and execution ultimately should be designed and measured by the benefit it brings to partners,
customers, and our business."

Inherent in Starbucks approach to reduce inefficiencies is the understanding that to be truly effective, those reductions should produce routines that free up people or resources to make stronger interpersonal connections.

This to me is what standard work is all about. It is about freeing up the mundane to make room for the creative. We enhance a workforce by having standard practices. In doing so, we give the power to frontline staff to create those “Aha” moments that we all talk about but seldom have time to do. I find time and time organizations and particular leadership for not empowering frontline staff. What I have come to realize is that it is lack of adherence to standard work as the problem versus empowerment. Clear, concise and documented standard work agreed on by leadership and frontline staff  creates the atmosphere for great customer experiences.  Go have a cup of coffee and see if you agree.