People are key to the ‘boomerang principle’

In superhero plots, I love the way that no-one can ever guess the leading
man’s identity, whether it’s the latest celluloid offering of the Daredevil,
Spiderman or even TV cartoon Hong Kong Phooey.

The same uncertainty exists in the heroic business of keeping the customers
coming back for more – what Irish supermarket mogul Feargal Quinn calls ‘the
boomerang principle’.

The few that understand it – which include Richer Sounds, First Direct and
ASDA – love to boast about it. As Alan Hughes, chief executive of First Direct,
explains: "We’re happy for anyone to come in and look at what we do,
because we know that while they can copy our systems and our tools, it’s our
people who make the difference." How smug is that? And as an ex-employee,
I can confirm that they are so sure of themselves, they really do organise
coach trips for their competitors to visit their call centres.

Why then are they so comfortable with their superiority? Is customer service
so hard to understand? No. Are their people smarter? No. Is it because they
know their competitors are afraid to copy them? Could be.

To apply the boomerang principle requires people who can build
relationships, listen, and innovate.

Realising that is easy, but not necessarily cheap. It took dismal results at
Alliance & Leicester for senior managers to see (after paying good money to
consultants, including yours truly, and KPMG) that a customer-first strategy
requires a people-first reality.

Its newly appointed chief executive Richard Pym used this newly gained
superhuman vision to initiate the most extensive change programme the
organisation has ever attempted. It encompasses 80 different consecutive
projects to fulfil its ambition to be the ‘most customer-focused financial
services organisation – bar none’.

To its immense credit, it did not stop with mere technology or process
redesign, but instead launched a plethora of cultural initiatives to free up
those that Pym calls ‘people who love people’ on his chatty intranet. It is no
coincidence that Which Magazine awarded Alliance & Leicester the
title of best provider of service among high street banks.

Previously, the board didn’t have the guts to do the most important things,
including culture change, respect for human potential, open communication, a
willingness to accept failure and admit mistakes.

The good news is that financially-trained Pym no longer sees empowerment or
service as ‘soft and fluffy’, but instead as the hardest, most influential ways
to improve shareholder returns. It has just announced an 18 per cent increase
in profits.

Is this the end? I hope not. Not before the power to satisfy customers is
given to the people who serve them. That is the ultimate manifestation of the
customer-first, people-first logic. Only when your organisation is no longer
afraid to follow that logic to its conclusion will its performance and
relationship surpass the smug, but superlative, First Direct.

Max will discuss these issues further at the Unshrink the People
seminar in Leeds, 19 March 2003. E-mail

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