Heskett et al., 1994

After reading a number of articles on the subject of “voice of the customer” it was clear there are many models that have been developed around the topic.  The Heskett model is one of the most recognizable and has received a lot of press in the market place and within Avnet.  It simply connects the dots, which are designed to accelerate the success of the organization.  This particular model is no different than a lot of other models that focus on the connection between employees and customers and the organic growth it can drive.  The real challenge is not in the model itself but in the implementation, execution and commitment to the model.  That is why you find very few companies who are held up as the stars of this simple formula.  

Given that implementation and execution seem to be the issue, a simple road map that connects the dots was in order.  The intent is to identify key elements and balance the inputs to maximize the output of a company based on all the business levers at management’s disposal.

Maximizing Performance

Since we need a beginning, we start at the value proposition.  Very simply, this is what a company is providing as a product or service to address a customer’s need.  The point of the chart being circular is that value propositions have life cycles and a company must continuously reinvent itself to maintain its healthy existence.  Therefore, it must position itself to listen and learn from its environment, which include its employees, customers, suppliers as well as the markets served.

 Service delivery can have the greatest impact in customer service.  The service customers experience determines the likelihood of customers buying from you initially and whether they will come back.  The organization needs to optimize its processes, systems and training to enable employees to flawlessly meet or exceed the needs of the customer.  This is why each customer interaction is a moment of truth.

Whether you are a public or private company there will be a number of business measurements that will guide you to your objectives.  Business metrics include, financial, employees, customers, suppliers, competition, shareholders and business specific market indicators.  All are important, but too many measures lead to paralysis, so measurements should be meaningful and simple to understand.  Create measurements on what’s important.  Dr. Hammer says “deciding what to measure is a science, but deciding how to measure it is an art.”

The survey process here is intended to allow for a business to collect information from its stakeholders.  It provides the opportunity to validate your performance or to learn something new.  The optimum survey design process allows a business to determine operational efficiency or business opportunity innovation.  Businesses as a discipline should be able to gather intelligence and act on it as part of the business process.

Once you have gathered information from your key stakeholders it is important to determine what the data is telling you and if you should act on it.  This is where the business metrics are used to determine the viability of implementing operational or business innovation.  The concept of ROI is nothing new and in this case the company is determining whether operationally it can lower cost while providing a higher level of service.  On the innovation side it gives the opportunity for product or service extensions or adjacencies.

Once the operational and business innovations are determined and prioritized, its time to test them for additional validation.  The listening posts act as trusted advisors who provide feedback on the innovational opportunities from their (stakeholder) point of view.  This ensures that you have right concepts identified and how they value each of the innovational opportunities.

Customer metrics are very essential as they provide the insight into customers or better yet customer segments.  I think it is fair to say that customer metrics will vary by customer segment, since customers are at different maturity levels of consuming the value proposition, relationship and profitability.  The customer metrics should connect to operational, financial and employee metrics that provide meaningful correlations.

In the areas of innovation, a business has the opportunity to evolve their operational efficiencies based on customer feedback, relative importance and on a return that is acceptable to the business.  The win for both is easier, cheaper and faster to do business with and provides a competitive advantage.  The opportunity for business innovation results in determining new products and services that customers are interested in, whether a valid market opportunity exists and it can expand your share of wallet with existing customers and attracts new one.  Both result in organic growth.

In the areas of customer and business measurements is how we keep score to determine our progress and determine our progress/return.  Keeping score results in accountability and commitment to ensure we met our objectives of the revised brand promise and the financial returns of the business.  It also provides directional information to determine if a course correction or adjustment is required based on enhancements to the value and service proposition or the product or service offering.  It is the win/win for the customers, the business and the shareholders. 

Communication can never be over done.  Once the business has determined the direction it will take based on the input of its key stakeholders its time to tell the world what you learned, what you are going to do, how your going to do it, why it’s important to the stakeholder, how progress will be measured and how often they will be updated on how we are doing.

There are many VOC models, which can be adopted by a company that could work.  There is agreement that collecting feedback from key stakeholders is important and critical to a company’s success.  However, this topic has been around for years, so in my opinion it gets down to leadership commitment, process and execution.  This process provides feedback to determine opportunities, challenges, adjustments and course corrections based on enhancements to the value and service proposition or a new/revised product or service offering.  A company can balance the business requirements with the voices to create a win/win for key stakeholders, while establishing a culture and process for continuous growth.

Posted under Business & Process Innovation, Customers, Employees, Leadership, Shareholder Value, Value Proposition

Consistent Value Message to Customers

I had the opportunity to meet with President, Colleen Barrett and her team at Southwest HQ last week.  I went there to learn how they have maintained the customer and performance culture they are renowned for.  Colleen summed it up with Southwest’s priorities, which begins with their employees, followed by their customers and then with their shareholders.  They have proven that focusing on employees, who if treated and trained right, do magnificent things for customers.  If customers see value in Southwest’s offerings and are treated the right way by employees, they become repeat buyers and recommenders to others.  From a shareholder perspective, Southwest’s formula has rewarded them with a consistent financial performance over the years. 

The question is, is Southwest the same airline as it was 30 years ago?  No, according to Colleen, the core is the same but the Southwest culture is better than it has ever been.  The Southwest framework allows the flexibility to evolve its value proposition (new offerings), service delivery and operational efficiencies through their employees to enhance the customer experience and reward their shareholders.

There are plenty of reports from academia that validate the intuitive connection that Southwest has made so successful.  It is easy to understand why the connections are so important yet it is not easily attained.  Why is it so complicated to achieve?  My simple answer from studying a number of companies and reading numerous articles on the subject is that it requires alignment of many business levers to produce optimal results.  It also takes time to make the alignment adjustments and unfortunately, in today’s environment we need immediate results, so time may not be our friend. 

Voices Calibrated to Maximize Acceleration

In the illustration I have created business levers that need to be connected to make the alignment approach work.  This is not all inclusive and depending on your industry or business model there may be omissions or deletions.  Unfortunately, there is no perfect model and some work needs to be done by an organization to adapt any model to their business.  One other extremely important point is there is no single business, employee, customer, shareholder or leadership lever that works on its own.  They are interconnected and as levers are adjusted they have an impact on each other.  

This is where a skilled leadership team is needed.  They are constantly monitoring and adjusting the levers to maximize alignment for optimum performance.  There are times when some levers may give more value based on market or environmental conditions.  Now, let me be clear, the leadership team is not only adjusting levers, but it is also enabling its employees to be a creative, thinking, changing and thriving culture.  That is the intent of the circular movement of the chart above.  It includes the constant examination of all business levers to ensure optimal alignment of the voices of employees, customers, suppliers and shareholders resulting in business evolution.  As market conditions change a company must be maniacal about continuous value creation and transformation.      

As I said earlier this is a very complex transformation and not all companies can make the journey.  Remember when you discover how to do the difficult, it is not easily copied by others and therefore creates a clear competitive advantage, just ask Southwest.

Posted under Business & Process Innovation, Customers, Employees, Leadership, Shareholder Value, Value Proposition

I read an article today featuring a story on Brian Williams with NBC, who asked viewers for good news stories instead of all the doom and gloom news we hear daily.  I agree with Brian.  I think there is good news out there and good deeds being done.  Let’s turn our attention from how much worse it can get, to what each of us can do to make a small difference.  We can frown or we can smile and in the end it’s our choice.

My good news story may not sound like it has anything to do with customers matter.  However, as human beings our actions reflect our ATTITUDE.  In times of duress, it’s time to do something positive that will give us the spark to create momentum during these unsettling times.  I am suggesting something you should consider that will be fun, educational and put a smile on your face and others.  I know I had some fun and laughed a lot.

Flat Stanley

I have been asked to help a 2^nd grade class in San Jose, California with the adventures of Flat Stanley.  Flat Stanley, written by Jeff Brown, is a story about a boy who is flattened by a bulletin board while sleeping. As a result he is able to travel in envelopes and experiences many adventures as a flat person.  The learning opportunity for the kids includes creativity, geography, culture and the kindness in people’s heart to make a difference.   The kids made the Flat Stanley in the picuture you see and mailed it to me. 

It would be impossible for me to be in the many cities around the country or the world in the short time of this project.  That’s where you come in.  I am attaching your own Flat Stanley so you can take part in his journey.  Print it out and cut it out as I have here. 

Flat Stanley in San Antonio

To give you an idea of what we are looking for, I have included a photo of Flat Stanley in San Antonio attending a Spurs basketball game with myself and some friends.  It was fun and folks around us were curious and laughing too.  The intent is to let the kids know where he is, who he’s with and what he is doing as they see Flat Stanley showing up all over the world. 

So all you need to do is take a photo of Flat Stanley in your home town and send it to jack.cuen@gmail.com by April 17th with your name, location and what Flat Stanley is up to.  The kids will be tracking his progress on a world map back in their class room where I will provide them updates from you on where he is.  I hope you can help us with Flat Staley’s global adventure. 

Flat Stanley Visiting Southwest Dallas HQ

During this time of doom and gloom, life goes on.  We have a chance to create a positive attitude for our self and inspire others as well.  The future will be in the hands of our children, lets show them the power of attitude as they serve the new generation of customers.  The world will get better one deed at a time and we will make some good news.  Smile, have some fun and make a small difference.  Thank you on behalf of the 2nd graders, Flat Stanley,  Avnet and me!

Posted under Customers, General

The current economic crisis has been billed as the worst ever.  However, even in tough times, there are companies that overcome the obstacles and prove to be winners.  In tough times, you also find reasons to celebrate any good news.  We had some good news today and we are very humbled by the recognition we received.  Thank you for the recognition and congratulations to all of Avnet on the accomplishment.

Avnet Named No. 1 in Its Industry on Fortune’s “Most Admired Companies” 

Customers Matter

March 3, 2009 – PHOENIX — Avnet, Inc. (NYSE:AVT) has been named No. 1overall in the Wholesaler: Electronics category in the annual “Most Admired Companies” list by Fortune magazine. A global technology marketing, distribution and services company, Avnet moved up from second place overall in 2008 and was ranked first in eight out of nine reputation attributes, including innovation, people management, use of corporate assets, quality of management, financial soundness, long-term investment, quality of service and global competitiveness. In addition, Avnet is one of only two Arizona-based companies named to the 2009 list overall.

 ”Being named the most admired company in our industry is a distinct honor and huge tribute to our talented team of employees around the world,” said Roy Vallee, Avnet chairman and CEO. “We have been consistently investing in building a premier organization that delivers superior value and accelerates the success of our trading partners. I am very proud of the performance of our team, and this award motivates all of us to reach even higher.”

Described as the “definitive report card on corporate reputations,” Fortune’s rankings are based on a survey of executives, directors, and analysts who are asked to rate companies in their own industry on specific criteria from investment value to social responsibility. Only the best are listed: A company’s score must rank in the top half of its industry survey to be on the “most admired” list. For more information about the Fortune list of “Most Admired Companies,” visit http://www.fortune.com.

There is Always Another Mountain

Although this is great news and we will celebrate, we also know that this is just a point in time.  The great news is it has set a new bar for us to maintain and exceed.  Climbing a mountain is a difficult task and it takes work to get to the top.  Now that we have reached the summit it’s on to the next higher peak and a continued commitment to excellence in all we do.

Posted under Customers, Employees, Leadership, Shareholder Value, Value Proposition