The 3Ms of Service Excellence Culture Success

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Service Excellence Culture is One of the Few Remaining Ways for Brands to Truly Differentiate in Highly Competitive Markets

Customers now have more choices than ever on where to spend their time and money. Having strong voices in social media and on-line rating sites have further shifted the balance of power, creating the “hyper-empowered customer”.  With intangible, often borderless, services representing 65 -75% of global commerce, organizations large and small are keen to drive exceptional customer experience by creating cultures that are inherently committed to excellence and customer-centricity. We call this Service Excellence.  For perennial customer experience leaders and best-in-class service brands, this means going beyond traditional change management to adopt Service Excellence as an “organizing principle” that fundamentally re-sequences organizational and operational DNA.

The case for Service Excellence culture.

In virtually every measurable category, perennial customer experience leaders and best-in-class service brands simply outperform the market and their peers. Valuations for leading service and customer experience brands grew by 32%, while laggards grew at 3%.  Correspondingly, while total returns for the S&P 500 were 20%, these leaders delivered returns of 34%, while laggards delivered 5%. With increased customer retention, referral sales and repeat sales on the revenue side are combined with reduced customer acquisition costs, cost-of-sales and cost-to- on the profit side, the underlying business case for service excellence becomes even more compelling.

Service Excellence Culture at the DNA Level.

Leveraging the power of service excellence to drive exceptional customer experiences is no trivial task. According to Harvard Business Review, putting customers back at the center requires more than cosmetic changes, executive fiat or internal re-orgs — it requires embedding service excellence and customer-centricity into the corporate culture to unify, align and mobilize all parts of the organization. In practice, this translates into a fundamental resequencing of organizational and operational DNA to the point where decisions, actions and ways of working are prioritized around the customer, and where every customer interaction is predisposed to: 1) consistently deliver on customer expectations, relative to brand promises; 2) routinely deliver elevated or exceptional experiences that delight at moments that really matter to customers; and 3) occasionally provide those memorable, shareable “WOW” experiences that truly surprise.

The mindset, mandate and model.

In the context of closing the gaps between what customers expect and what they actually experience when engaging with an organization’s service propositions, service excellence becomes a powerful strategic aspiration, and a durable source of deep differentiation and competitive advantage. However, despite the strong correlation between service and experience leadership with distinctive marketplace performance and superior business outcomes, many organizations lack the basic ingredients – mindset, mandate and models – to catalyze and sustain service excellence and customer-centric culture at the level of perennial service and experience leaders. Accordingly, service excellence culture can be an efficient, organic centerpiece in renewing the fortunes of mature organizations. To that end, effective activation of service excellence culture starts with leaders to promoting the right mindset, delivering a clear leadership mandate and leveraging the right deployment model– the “3Ms” of activating service excellence culture.

The Mindset. The dominant mindset, or psychology, present in an organization is a major determinant in its operating pace, how it perceives itself internally, its ways of working and how it is perceived by customers and other external stakeholders. A corporate mindset built on the ethos of service excellence can serve as a catalyst to overcome internal biases, negative sentiment and resistance to change.  This mindset starts with meaningful shifts in behaviors, beliefs and habits:

Behaviors. Good enough has become enough in many organizations. However, with the need to deliver exceptional customer experience, mere adequacy will fall short, create negative sentiment and increase the potential for customers to become vocal detractors. Service Excellence allows organizations to reframe the delivery of elevated experiences from one perceived as a costly and unnecessary proposition to one that is fundamental to the organizations strategy, brand and ability to create value. The customer-centric behaviors inherent to service excellence cultures allows organizations to expose and resolve hidden sources of customer frustration and dissatisfaction by recalibrating the traditional tolerance for mediocrity while internalizing the benefits to customers, individuals and the organization.

Beliefs. A second element of the service excellence mindset is the question of what the organization believes. Simply put, many large or well-established organizations simply don’t view themselves as capable elevating customer experiences. Rather, they may see themselves as prisoners of their prior success that simply trade on past accomplishments. In contrast, the very human aspiration for excellence introduces the belief that “anything is possible.” With this new belief system, organizations are able to stretch their thinking to not only re-imagine what they are capable of, but also to turn that aspiration into reality.

Habits. The commitment to excellence and customer-centricity embedded in the service excellence concept helps organizations and individuals take a more pragmatic view of the customer experience challenge by accounting for the many interdependent factors that actually drive those outcomes. Unconstrained by the logic of orthodoxy, organizations can hone new instincts to detect hidden signals, empower employees closest to the customer and make the value leap to deliver an anticipatory (vs. reactive) service experience.

The Mandate. Service excellence doesn’t happen by accident – it happens as a result of deliberate and determined action over an extended period of time. When seeking to capture the spirit of service excellence, organizations must identify and unlock a “brand” of service excellence that is unique to their unique circumstances and context. To do this, leaders must demonstrate their understanding and explicit endorsement for service excellence by granting “permission” for the organization to adhere to a standard of excellence and engage in customer-centric activities. This permission creates a mandate that can be imparted and reinforced when leaders promote a new set of principles, employee guidelines and operational decisions.

Permission. Service excellence requires the adoption and advocacy of several key leadership principles that create a climate where:

  • Once empowered, employees are not afraid to fail at taking personal ownership of customer challenges, and should failure occur, the focus is on problem solving and learning rather than on blame, retaliation and punishment;
  • Innovation and experimentation are encouraged and meaningful distinctions are made and value attributed to safe ideas that maintain service quality and those breakthrough ideas that radically elevate the customer experience;
  • All employees understand, acknowledge and hold each other accountable for making service excellence an explicit enabler to the company’s vision, brand reputation and objectives.

Practices. Leaders can mobilize individuals, teams and the entire organization around service excellence by taking specific actions related to human capital development to include:

  • Identifying, developing and supporting a cadre of “Service Excellence Champions” to stimulate service excellence thinking, transfer knowledge and support internal service improvement initiatives on a continuous basis;
  • Stimulating fresh perspectives, challenging orthodoxies and generating new ideas by rotating employees through different parts of the business; and
  • Motivating and retaining key employees by providing career paths and exceptional compensation opportunities for modeling service excellence behaviors, beliefs and habits.

Prioritization. Leaders must encourage service excellence by prioritizing resource allocation decisions that:

  • Prioritize the allocation of resources to the service delivery system on the basis of value and positive impact to the customer experience, rather than historical precedent;
  • Allocate resources in a manner that supports the consistency of serviced delivery, while ensuring that opportunities to delivery “Wow” moments have the resources necessary to be successful; and
  • Allocate resources in an incremental manner so that resources can be shifted to support urgent service recovery needs or touchpoints that are showing the most promise.

The Model. There are multiple models to enable and support service excellence . For example, created by Horst Schulze as cofounder of the Ritz-Carlton Hotel Company, the legendary Ritz-Carlton Gold Standards enabled that brand to win two Malcolm Baldrige Awards—the first and only hotel company to do so. Rather than follow an easily copied formula, each model for service excellence culture should reflect a “unique service proposition” – truly  authentic, recognizable and resonant within each individual organization and accretive to its brand.

Deployment Models. Organizations require deployment models that guide how service excellence impacts and interacts with existing norms at the individual, team, function and enterprise levels. Within this context, selected models apply, not only to the underlying elements of a new service excellence culture itself, but also to how the culture co-exists and enables other organizational and operational systems. Therefore, it is imperative that leaders recognize that individuals, teams, functions or enterprises may have unique sub-cultures that must be considered.

Leadership Action. The service excellence model that an organization might deploy depends on considerations in the area of leadership empowerment and ownership. Each organization must deploy a model of empowerment and ownership that are based on their unique operational and organizational considerations. Leadership can use the selected model to focus on closing the translation gaps between an existing levels of empowerment and ownership and those models that are desired in the future.

Summary. For service and experience-based businesses and brands, delivering exceptional experiences across the entire service portfolio and customer journey is no longer an option. To achieve the all-important goal of leveraging the enduring power of service excellence culture to drive exceptional customer experience outcomes, leaders must create an environment where the ethos of service excellence can take hold and thrive through the “3Ms.” This approach starts the journey of renewing organizational mindsets, creating a clear leadership mandate and deploying the right empowerment and ownership model. When taken as a serious discipline, service excellence culture has the potential to deliver sustained value by consistently closing gaps between what customers expect and what they actually experience.

 To learn more about the power of service excellence culture, leadership operations, customer experience culture, memorable customer service and employee engagement read the full article by Wayne Simmons of Opptiv – The Service Excellence Company on CustomerThink:

This article was informed by personal experiences as the Global Head of Service Delivery at The Ritz-Carlton Leadership Center and working with businesses and brands on their must urgent customer and service challenges.

About the Author:

As co-founder and Chief Experience Officer of Opptiv, Wayne Simmons was previously the Global Head of Service Delivery for The Ritz-Carlton Leadership Center.  As a thought leader, change agent and an expert experience strategy consultant, he led a team dedicated to delivering the legendary ethos, practices and systems of the Ritz-Carlton brand for client organizations across industries. Wayne leverages the principles of Horst Schulze, Cofounder of The Ritz-Carlton Hotel Company and creator of that brand’s legendary reputation for service excellence and customer-centric culture. As a Trusted Advisor working at the intersection of HR, CX and C-Suite leaders, Wayne coaches, trains and consults with businesses and brands on their journeys to maximize customer growth, loyalty and attain competitive advantage through service excellence and customer experience culture, leadership and operations. The Service Excellence Company, dedicated to helping brands turn service into competitive advantage.

About Opptiv:

 What to learn more?  Check out our services page.

Opptiv is the Service Excellence Consultancy. We help businesses and brands win through service excellence culture, customer-centricity and exceptional customer experience. Unique in the industry, we take a playbook approach to help clients achieve business outcomes at enterprise scale. We start by applying Design Thinking to activate leaders and engage frontline talent in the co-creation of purposeful culture platforms and unique service propositions that all levels can understand, embrace and hold each other accountable for. We then create brand-aligned playbooks to document the underlying elements of the culture as actionable guidance, practices and function-specific “plays”. Finally, we use these playbooks to inform the internal communications and tailored training needed to align, integrate, reinforce and sustain service excellence across all parts of the business.

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