August 4, 2010

Change management always means cultural change and it should include some change of personnel. I have a friend who’s experiencing this first-hand and he is frustrated every day. He came from a company that was fast, agile and a leader in its field, and is faced with raising the bar in an organization that has basically stood still for decades. They have a new chief who has announced his intention to move performance to much higher levels, but they’re dealing with a culture and employees that don’t change that easily. What is my friend to do?

After listening to my friend for over a year now, I’m inclined to tell him good luck and get a prescription for a good antidepressant. His problems lay in three main areas:

• Existing culture: this place has been a stagnant pond for many, many years and processes have developed to maintain it just that way. The current beliefs, principles and values sound better than what is actually produced. In fact, they sound really good, but there is no evidence that anyone tries to implement them. It’s a culture of mediocrity perpetuated by the next problem,
• Existing people: the current employees see no reason to change anything. They like it there! They’re rewarded for minimal performance and results, so why would they want to change that? When my friend tries to introduce higher standards, there’s plenty of push-back or just apathy. Who’s not doing the job here? Problem 3,
• The new president: He’s introduced a new set of values and a mission statement with great fanfare and passion, but they’re so involved it takes a half-hour just to read the bizarre chart they’re posted on. You can’t expect people to get behind something that needs a translator! And he won’t get rid of the people in key positions who are obvious obstacles. One man has been in such a job for fifteen years and has done nothing but act as a caretaker. He’s openly resistant to change and yet there he stays.

These are common problems in any organization trying to make changes. They’re challenging but not impossible to overcome. But it requires senior leadership to lead the way, and in my friend’s case that’s not happening. The new president needs to replace a number of people but won’t and they’re holding everything back. My friend has a lot of responsibility but no significant authority and so his frustration will continue. There are few reasons to think anything will improve soon.

Leaders have to make tough decisions when changes are being made. Clear vision and values are required, yes, but so are signs that you mean it! What is lacking here and often elsewhere is accountability and the guts to replace key people with those that will back the new initiatives 100%. Try and win the hearts and minds, sure, but after a year with no progress it’s time to get some new people, the right people, on the bus.

June 22, 2010

Success may breed success, but it can also breed complacency and contempt. This is not a new insight, but I have yet another example of the latter. One indicator is when product quality drops and customer service is ignored. My latest example is Skullcandy, a very successful business that manufactures ear buds and headphones. During last year’s crushing economic troubles, their CEO was quoted as saying “Recession? What recession?” Their sales growth was outstanding, their marketing budget seems limitless, but quality and customer service, well, that’s a different story.

And here’s my story. My family has owned several pairs of Skullcandy earphones, and in less than six months, three of them broke. Keep in mind that their products are not cheap! I expected better. In one case I returned the earphones to the company in person (they’re local here in Utah), and was offered a replacement for no charge. So far, so good, that’s what they should do. I paid a little extra to upgrade and left. A few months later, the new phones broke. The new, more expensive ones. Their website makes a big deal about their customer service, and this time I wrote them a message on the website explaining my dissatisfaction with the quality of their product. You can brag about customer service but I don’t want to have to keep using it!

I heard nothing back. Not a word. It seems they encourage you to send them a customer service message, but don’t expect a reply! Not my definition of service. So I decided to write a letter to Skullcandy’s president. An actual letter, on my business letterhead, explaining my concerns with poor quality earphones and no communication from their customer service people. Generally this brings a swift response. Company presidents usually know the value of keeping customers and projecting a good corporate image. Not so with Skullcandy. It’s been over a week and I’ve heard not a word in response. Again.

Products that break in a few months and a total lack of responsiveness from customer service and the company president. That’s Skullcandy. They’re still selling boatloads of their products, but this will catch up with them eventually. I ordinarily take pride in local businesses and try to buy from them whenever possible. But I won’t be supporting Skullcandy again if they think that little of their customers.

If you’re a consumer, don’t let businesses off the hook when they let you down. You are the marketplace and your voice should be heard. If you’re in customer service or run a business, one of the biggest dangers is when things go well. Don’t relax, don’t take customers for granted. Quality and service bring us in, lack of them drive us away.