Even though this new year has just begun, I have
found myself on the road twice in the past two weeks. These trips provided time
for me to finish reading Good Profit by Charles G. Koch, the CEO of Koch Industries, Inc. The central premise of the book is the management program used
by Charles at Koch, called Market-Based Management, to create a successful
organization. Market-Based Management, or MBM, has a core objective of
developing good profit, which is defined as revenue from the purchases of
individuals for products developed to improve people’s lives. Good profit is
created in a culture where employees are free to work entrepreneurially to meet
the needs of the customers. Although sounding simple, in many organizations
this is difficult to actually implement.
As a leader in your organization, creating an
environment of success is the core purpose. This success seeps into areas of
revenue generation, profitable operations and other areas of an organization. The
key ingredient to the success of an organization is the development of its
teams and individuals, “build people build an organization.” There are three
items that I think contribute to the success of an organization through your
teams.
Valued
Individuals Produce Excellent Service
– There are many different customer service programs and processes that are
implemented in companies today. No matter what program or process an
organization implements the key to customers experiencing excellent service
begins with the team members. When individuals feel valued and are excited to
be at the company, the service will show it. The positive attitude and desire
to make the organization successful that the employee produces is reflected in
the service the customer experiences. However, when an employee does not feel
valued or does not enjoy being at the company, it does not matter what customer
service program or process you implement, the experience your customer receives
will probably less than excellent.
I had the pleasure of having my wife join me on one
of the trips this year. We decided to arrive a day early to enjoy sometime in
Napa at a few wineries. One of our favorite wineries is Grgich Hill Estates and
we were returning for our first visit in over 17 years. As we entered, Andy
greeted us and finding out about our return provided an opening “welcome back”
taste of a wine before our actual tasting began. The experience with Andy was
excellent and you could tell that he felt valued and enjoyed being at the
winery by his excitement about the wines and the information he provided. His
excitement spilled over to my wife and I as we looked at the possibilities to
invest more into the winery.
Decisions
Do Not Need to Take Journeys –
In many organizations that are dealing with decline, there is an ethos that
only upper management can make decisions. Although this is good for some
decisions, not all decisions need to be viewed in the same way. This process
often causes a slow reaction to decisions that need answers immediately, which
can then lead to a loss to the organization. Additionally, team members that
are in the day-to-day activities have a better understanding of the current
situation that affects the decision. Their knowledge is wasted when upper
management is only allowed to make decisions.
A successful organization provides each team
member a level of power to make decisions. This process leads to an
organization that is not bogged down in decisions and is able to move with
flexibility when decisions need to be made. Providing each team member with the
permission and tools to make decisions leads to success as well as a better
experience for your customers.
Provide
Tools to Exceed Expectations –
In a world of greater expectations, organizations often do not provide their
teams with the tools necessary to meet or even exceed the customer’s
expectations. Providing decision making power, creating flexible processes, or
providing cross training between positions, are all tools that an organization
can offer to their teams to exceed expectations.
The Ritz-Carlton set the standard early on in its
creation to be the place that provides their guests with the highest quality
service, immaculate interiors, and exceeded expectations. The Ritz-Carlton did
not make this a motto or idea but it put it into action. They provided their
staff with the tools needed to exceed the expectations of their guests. One
tool was the empowerment given to each and every employee. The Ritz-Carlton
employee handbook states:
At The Ritz-Carlton, everyone has $2000/day per
guest to make it right or delight, but the money is symbolic. No one is walking
around with $2,000 in his or her pocket. However, from day one at your job,
you’re encouraged and empowered to fix or improve a guest’s experience, and you
may spend up to $2,000 to do this.
Not every organization is able to provide this
specific tool, but there are tools that you can be providing to exceed
expectations.
The world is looking for successful organizations
to support them with the products that make their lives better. Whether you
lead an entire organization or one department, the first place to start, as a
leader, is to empower your teams and employees. Today decided if you are
willing to:
- Begin to value your employees
- Make decision-making available at all levels
- Provide the tools for employees to exceed expectations
Today can be the beginning to your organization’s
success.
