2015 predictions: all about more and less!

Like 2014..., 2015 will be the year that everything and nothing changes. It will be a year of contradictions… of opposites:

·        Everything will be the same but nothing will be the same

·        We will be even more closely connected yet less connected at the same time

·        We will become even closer but even more lonely

·        It may even be the year that social media gets exhausted

·        Everything will go faster but slower

·        We will want everything faster but we will want things slower.

That's what I think and that's what some of the top lists on the internet suggest...

Top trends for 2015 will include:


1 The Digital Stuff

Your digital footprint will be your most valuable asset
Customers talk and now they talk more than ever – what others say about you will be more important than what you say (advertising is dying). Natives naturally check out who says what about you and compare it with what you say and how you say it.

More, more, more 
Customers will want/demand/expect more of a 360 degree experience – more of everything… an immersive experience. 4D is better than 3D, etc… we will be expecting smell, taste, sound. Not just products.

Faster, faster, hyper-fast. 
Living in what Mack calls “the age of impatience”, customers expect more, faster and more conveniently than ever before. The consequence of this is that we become more impulsive – the logical extension of going faster.

Shoot ‘n’ Go
Pictures will replace 1,000 words.
Still and moving pictures will become their own currency. Everyone can shoot/edit/publish/distribute their own experiences, friends… in fact, anything that can stand in front of a smartphone will be shot. Everything will become increasingly visual: websites, adverts, communication.

Mobile technology changes everything 
Especially in emerging economies – it gives you access to health care, education, finance. It knows no boundaries. In the first world, nothing will be safe: everything can be (and probably will be) disrupted. Nothing is sacred. There will be an app for everything!


2 The ANTI-DIGITAL STUFF (in a kind of digital way)

Customer is King
The customer experience will become the new competitive battlefield
We will get one step closer to the idea that the customer is king. Companies that offer the basics (courtesy, speed, warmth, friendliness) and provide legendary service will be the winners in the long run.

Revenge of the Luddites
As a reaction to too many people literally living through their smartphone we might find the emergence of smartphone-free zones both socially and at work. It is time to get back to old-fashioned ways of communicating and connecting, like sharing a nice cup of tea or a walk in the countryside.

A Campaign for Real
There will be an increased sensitivity that will seek to differentiate between the authentic and genuine as opposed to the manufactured, synthetic, superficial and fake: food, TV, music, people, etc.

Being Mindful 
As a backlash to the hyper-fast world we now live in there will be a growing interest (probably an obsession) with all things peaceful, quiet and reflective.

As I said, everything and nothing changes. The problem is that the technology will fool us into thinking that we will be happier and more efficient. 

The bankers and the politicians and the media will still be the same.

The importance of love, the family and laughter will still be the same!

2015 - The Year That Social Media is Exhausted

According to Mashable 2012 was "the year we exhaust social media." Or should it have been 2013!

Well it doesn't seem to have happened in 2014 so maybe in 2015???

I don't think that social media is dead ("deceased, no more" as in Monty Python) but as Mashable say, we are exhausted. Social/digital Exhaustion could become next year's catch phrase.

People finally realise that connecting or following, being followed (as a numbers game) or liking is meaningless unless there some purpose and some result. (See Twitter is For Losers)

I think the light bulb moment happens when you employ people and they appear to be playing on social media (while you are paying them to do so).

Now I don't deny the benefits of being open, pursuing random connections and so on. I love it. BUT we must not confuse activity (=wheel spin?) with business.

I am not the social media guru (see my ironically titled e-book I am not a Social Media Guru) but we have noticed that many of our clients have become fixated with activity and almost irrelevant vanity metrics when they need to get back to basics... 


So reflecting about the state of play... 

On the one hand, we have the social media zealots grabbing at the next new best thing universal antidote. 

On the other hand, we have the incredibly lazy marketing habits of the old school agencies (see Why Marketing is a load of B******s!) simply spending more in a naive attempt to interrupt and buy people's attention. 


What we do know...

What I do know is that there is:
- just too much noise and it is turning off a lot of people
- just too much "me-too" follower behaviour (buyers and sellers)
- not enough common sense engagement and connection
- a brilliant system (fast, quick, vast, cheap) to reach out and find and explore and share with others.
- tons of opportunity if you can just navigate your way through it all
- not enough time to do it all so a need for clear guidelines, prioritisation and time management!!!

But all of the above is obvious!!!


Or is Social Media just a red herring?

To be honest, I am starting to feel that the problem is actually not so much about Social Media and is more about about THE MESSAGE. Your message. (The channel/platform debate may actually be a red herring.):
- What exactly are you saying that is interesting? 
- Is it compelling? 
- Is it worthy of attention? 
- Is it clear and helping other to understand what you do? 
- And how can you help?

All the talk is about how you communicate and what works . (Maybe that's simpler than dealing with the basic "Why should people bother to buy from you?" question!) 

But if the message is broken (and let's be honest, most are) then you are simply wasting your time.



See 2012 - The Year That Social Media Became Exhausted

[Image: http://www.keepcalmandposters.com/posters/1616379.png]

Top Blogs Of 2014

Here are the Top 10 Robert Craven Blogs of 2014 - on LinkedIn


Social Media

• So Much Social Media Nonsense
• Why Your Blogging Strategy Is Probably All Wrong

Service Delivery and Customers

• The Service Delivery Gap You Are Missing
• Lousy Rotten Stinking Customers And Clients

Time/Self Management

• What To Include In Your Not-To-Do List

Growing Businesses

• Why Consulting Firms Are Failing Medium-Sized Businesses
• Directors Do Not Need Silver Bullet Business Advice
• I Am Not An SME, You Patronising ***!

Professional Service Firms

• Why The Professional Service Firm Blocks Its Own Growth
• What Do Event Planners Look For In A Speaker?

Humans Need Not Apply

Humans Need Not Apply is a 2014 short internet documentary film, directed, produced, written, and edited by CGP Grey. 

The film focuses on the future of the integration of automation into economics, as well as the worldwide workforce. Grey released the film online through YouTube.

This video is really thought-provoking about the future of work, Not for future generations but for the younger generation. it asks some tough questions. It is compelling viewing.

Bruce Kasanoff of Forbes commented that the video was "sobering," and "suggests, in a convincing fashion, that many human jobs will disappear over the coming years, because automation will do them faster, better, and cheaper."

Will our jobs disappear?

Great British Entrepreneur's Handbook 2015

Delighted that I am a featured contributor in the brand new Great British Entrepreneur's Handbook 2015 - It is currently available as a print edition (£12.99) or on Kindle (free) from Amazon.

My chapter is entitled "The Changing Needs of Those in the Middle". It seems to have ruffled a few feathers!!! It starts:

The business development needs of small and large businesses seem to be catered for by coaches and big-ticket consultancies respectively. However, the market is failing to satisfy the needs of the directors of medium-sized businesses. 

This is a failure in terms of 

1) not giving clients what they really want and need, and 

2) missing opportunities to deliver consultancy that adds true value to the businesses of clients. 

What’s available to help the growing business is limited and inappropriate for the real needs of the client. Recent surveys and reports confirm that consulting firms and the business support industry as a whole are failing to deliver what growing entrepreneurial businesses really need...

Here is the blurb for the book:

The Great British Entrepreneur's Handbook 2015 shares the secrets of experienced entrepreneurs on everything from how to tell your business' story compellingly to the secrets of growing a business to the next level. With wit and wisdom, the personalities behind some of the leading firms and bestselling business books of today guide budding entrepreneurs through all the highs and lows of what it takes to be a business success.

Check out  the brand new Great British Entrepreneur's Handbook 2015 - It is currently available as a print edition (£12.99) on Kindle (free) from Amazon.

Simon Sinek: Start With Why

I implore that you watch the video above. Then the brief notes below will make sense.

According to Sinek, the fundamental difference between the "Apples" of the world and everyone else is that they start with "why." 

Sinek has developed what he calls the "Golden Circle," 

1. Why - the core belief of the business. It's why the business exists.
2. How - how the business fulfills that core belief.
3. What - what the company does to fulfill that core belief.

Sinek found that most companies do their marketing backwards. They start with their "what" and then move to "how" they do it. 

See more at startwithwhy

Metro recognises our fave brands: Madecasse and Bighams

Always delighted to see our favourite brands in the news.

Yesterday we saw not one but two of our fave businesses side by side in the London Metro.

Well done to the Metro for recognising truly great independently-run businesses. Businesses that I am proud to be associated with.

www.madecasse.com

www.bighams.com 

The Strategy Workout - Get What You Want... out of your business

Robert Craven introduces The Strategy Workout.


"Robert and his colleagues at The Directors' Centre work with ambitious directors of fast-growing businesses who feel that they could be doing even better. 
As a keynote speaker his style is challenging, honest and goading; free of business school hyperbole he makes his audience think. 

In this four minute clip Robert introduces the workshop 'Strategy Workout: Get More of What You Want from Your Business', in which you will create a 3 step, 3 year plan for you and your business that will get results.

"More importantly, the tools actually work to help create 'sustainable business growth'. Businesses are able to measure and deliver on their roadmap... accountability gets built into a simple but effective board room process."

The FT describes him as 'the entrepreneurship guru'. 

He is not full of theoretical rhetoric; he offers practical solutions - tangible business results. 

Robert's books Bright Marketing and Kick-Start Your Business are business best-sellers and have been acted upon by thousands of growing businesses. 

His latest book is Grow Your Service Firm."

www.robert-craven.com

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Why consulting firms are failing medium-sized businesses

Here is the Executive Summary from this month's White Paper, 'Why consulting firms are failing medium-sized businesses'.

Executive Summary

A service delivery gap is reported consistently in consultancy practices.

• 79% of consulting practices reported that they delivered an above-average customer experience
• When asked, only 16% of the clients felt they received an above-average experience.

The reality is that consultancy practices are failing to deliver.

Between the synthetic siren calls of the gurus and the laden drones of certain academics lies a sweetspot that can really appeal to experienced business people.

What works for the entrepreneurial owner-directors of medium-sized businesses is something which does not have the dictatorial basis of either gurus, academics or management consultancies. Something that is more collaborative and participative. Something that is more respectful of their experience, expertise and achievements – and is more enduring.

What they want, what they lack, is a bigger picture that comes from focusing on Corporate Eudaimonia (‘human flourishing’), the best possible balance of financial, physical and moral well-being. Consequently, it has wider perspectives than pure maximisation of profit.

Experienced owner-directors don’t believe in miracles, or the efficacy of quick fixes. They think they have some – but not all – of the answers. They understandably don’t want to be preached to, nor have their experience and expertise ignored, or undervalued. They want heterarchy (a system of organisation where the elements are unranked) not hierarchy. They want to work peer-to-peer with mutual respect.

Owner-directors don’t believe that their business can be, or needs to be, transformed. They want improvement, not revolution, and they know that improvement is as much to do with how their business operates as anything related to direction or strategy.

They are looking for evolution: performance improvement over time, fitness in changing markets.

Read and download the full report, 'Why consulting firms are failing medium-sized businesses'.

How to Win Business awards

Robert Craven shares his insights on making your awards application stand out from the crowd.

Over the past few years I have been a judge for numerous national business awards and competitions: Great British Entrepreneur, Start-ups, Growing Business, Fast Growth, Bio-Tech, working with the ‘good and the great’ to recognise and celebrate the achievements of individual businesses and their owners.

The process of judging is always a humbling affair; it involves a lot of highly-heated debate as well as a lot of laughter. The refining and narrowing down of a group choice to one winner is not as scientific as a one would like, but at the end of the day the best business wins. There is a lot of similarity between the way that job applications get handled and award applications get dealt with.

The sifting process...

GBEA image

Read on at http://robert-craven.com/how-to-win-business-awards/

Stop Blogging and Think

If you wish to prove that your new business is just a run-of-the-mill and unoriginal, vanilla-flavoured company like the rest, just keep on banging out those quickly-written and, to be honest, shallow blog posts.

Every so-called social media guru screams, ‘Content is King’. No! Content is not King; Engagement is King. If you put out even more mediocre, average and truly uninsightful blog posts then you will simply be adding to the mass of mediocrity that clutters our inboxes.

Do you truly believe that your audience can differentiate your unremarkable and unmemorable little blog offerings from anyone else’s? Do your “10 Tips...”, “What we can learn...”, and “How to…” –type titles really make potential clients think, “Yes, I want to buy from them!”? I doubt it. No, you just look like a breathlessly over-enthusiastic start-up. Why would they look at your sheer predictable averageness? More relevant, who does find those titles attractive? I doubt it will be the people you are trying to attract...

Continues at http://robert-craven.com/stop-blogging-and-think/ 

Image: http://letmebuzz.com/wp-content/uploads/2011/05/stop-blogging.png

Owner-Directors Do Not Need Silver Bullet Advice

Owner-managers (the smaller, younger naive businesses) find it almost impossible to sort the good from the bad in the sea of offers of help. Their very naivety excludes them from knowing what they don’t know and what it actually is that they need. As a result, they tend to jump from one exciting initiative to the next.

On the other hand, owner-directors (in larger and more mature businesses) are not taken in by the breathless excitement of those selling hope to the needy. However, they find it hard to find the right assistance (being too big for the owner-manager offerings and too small for the offerings of the big consultancy houses).

 

As a starting point I would suggest that asking, ‘Where should the owner-director look for help and support?’ may actually be the wrong question.

 

The right question might be to ask ‘Exactly what is the problem and what are the underlying causes?’.

 

Unfortunately most suppliers of assistance do not carry out the appropriate diagnostic. Marketing consultants assume the problem is marketing, social media consultants assume the problem (and the solution) is social media and so on.

 

I would argue that what the business actually needs is an objective diagnostic, a look under the bonnet that examines what the key issues are and some sort of prioritised shopping list. The systematic approach is especially required for the owner-director.

 

Too often, the focus of interventions is on the business and the business goals and performance indicators. While it may be easier to measure and report on the easily measurable (the things that we can enter on to a spreadsheet), this rarely tells the whole story. The items that are tougher to measure are often left out of the equation. This is ironic as these are often the really important things.

 

The sort of questions I am referring to are less tangible but more about many owner-directors’ definition of success: Is this business fulfilling its purpose? Have we created a team and culture that is positive and self-reinforcing? Is this business sustainable in the long-run? Does it allow me to do what I really want to do with the rest of my life? Is it going to provide me with the funds I need (now and later)?

 

As we come out of the recession and as a little bit of pressure is coming off businesses so more and more owner-directors, managing directors and CEOs are starting to question the very fabric of their business and why they as individuals do what they do. There seem to be more and more people searching for answers, if only to validate that what they currently do is ticking all the right boxes.

Businesses are looking to create far more of a well-rounded solution recognising the need to create balance as well as a sustainable future. This requires an understanding of the bigger picture as well as its component parts: aspiring to develop a flourishing team, sales processes, cash-flow and profitability that deliver on the greater goals of the business. It seems that it is no longer just about the profit and the ROI but now there is a desire to create a more complete business that it is more satisfying and rewarding to own and run.

 

The owner-director may have been duped into parting with their own hard-earned cash in the past; the last thing they need right now is another guru with a magic wand. 

While a dramatic transformation, a radical revolution in how one does business may sound exciting (re-stimulating the passion and excitement of the old days), the wise owner-directors realise that what they probably need is a more delicate and evolutionary approach to growing and developing the business. The quest for explosive sales results is replaced with a desire to achieve sustainable growing profit.

The owner-director is very different from the smaller, owner-manager.

They have too much to lose (the nice car, home and holidays that come with painstakingly nurturing and growing a business) and they are no fools. What they are looking for is far-more considered support from people who have a mix of: been-there-done-it expertise, grey-haired wisdom, background credibility and the ability to communicate and assist. At this point in the business, one is looking for support in the long game, recognising the benefit of consistent and constant improvements (3% here and 4% there) that will create an engine for growth.

Work Less, Achieve More

We are endlessly told that hard work creates more profit. Work harder to create more profit in your new business. Does more work really mean more profit? Do we have to put in ludicrously long hours to be successful?

We have been brought up to believe that working more equates to being more successful. More input equates to more output. Well, I am not sure I agree. I think the logic (and many of the assumptions behind it) is flawed.

Sure, if you are a one-person-business, charging per unit of time, then more units equals more money. But most businesses try to grow by employing people to spread the workload. Or, maybe you should simply charge more per unit of time!

For those of us who are not charging by the hour, then I would argue that it may well be more profitable to work less. I repeat… to work less. Less hours… less stress… less banging your head against a brick wall.

I shall be more specific.

Jim currently works 5 days a week. In effect, he contributes 20% of a week's value on each working day. He admits that if he only worked four days a week (ie took Fridays off), then he could easily do “25% days”. In other words, with a Friday off he could and would work more productively on the other four work days.

But the maths deceives us of the real benefits of the extra day off.

If Jim spends Fridays doing whatever it is that he wants to (gardening, household/DIY chores, playing guitar, walking the dogs) then he will spend much of that time ruminating and reflecting on the days that he does work. Consciously, unconsciously, or subconsciously, he will be thinking about what he does on the working days. And this is where things get interesting.

With a bit of space from the work environment, Jim returns on a Monday with a new zest and vigour. But that is not all.

While Jim spends his Fridays doing his own thing, he will come up with great ideas for the business. So, he comes back to work refreshed, reinvigorated, and ready to go. Except now he has a freshness and an intensity about himself. He has more focus. More focus on what is required.

FACT: You never come up with great light-bulb moments when sat in front of the computer.
MORAL: Spend time away from the computer.
ACTION: To help your business, book more days off! 

To be more effective you need to work less. My challenge to you is that you can achieve more by working less.

Working harder creates burn-out. Working harder satisfies the voice in your head, the monkey on the shoulder, who says, “If you are not working long hours then you are short-changing yourself".  What utter tosh. 

We have been sucked in by the protestant work ethic (which did apply to factory workers where longer hours equal more pay). However, most of us are not factory workers, we are knowledge workers, and our pay is proportionate to the quality of ideas rather than the number of hours that we work. 

So, what's holding you back?

Admittedly, you have to put in the hours in the early stage of your business in order to get the enterprise off the ground. If success is a consequence of the number of people that know about you then you need to meet as many people as possible. However, I would argue that there is no point being a busy fool.

Once the business is up and running, the quality of your time is more important than the quantity. You need to spend as much time working ‘on’ the business as possible, stepping back and making sure you are doing the right things. The risk of spending too much time ‘in’ the business is that you might become a busy fool where you can’t see the wood for the trees. You don’t want to build a business that is 100% dependent on you 100% of the time. You want to create a self-sustaining machine that will survive without you.

Taken to its logical extreme, anything that is a repeated task should be handed over to someone else. If you can give a task to someone who can do it for £6.50 per hour then your holding on to that task means that, in effect, you only value your time at £6.50 per hour. Surely it is worth more than that.

Here are my one-liners, to print and put by your computer screen:

“ONLY DO WHAT ONLY YOU CAN DO”

“PRODUCE 20% MORE AND WORK 20% LESS”

 

Let others do the rest.

Image: http://www.siebert.aero/images/product_images/super_images/10139_Fly_More_Work_Less_hinten_2011130.jpg

Clients see a decline in professionalism - everywhere

There was a golden age in the years before the internet.

Clients of lawyers, accountants, architects, business consultants and financial advisers looked up to and respected their advisers. In fact, it was a two-way thing.

Advisers understood what it meant to be professional. They worked on behalf of, and in the best interests of their clients. Clients trusted you and you valued the trust that they imbued in you. But that trust got shattered.


Cunning advisers in almost every field would take advantage of their position. By definition, the professional expert had been trusted to do everything in their power to improve the lot of their clients. But now things had changed. Advisers started to work on their own account. They put their own needs (or should I say greed) ahead of the needs of their client. They started to abuse the trust. 

As it happened, the next thing was that the internet came into the equation.

The actions of the few unscrupulous advisers had muddied the waters for all their kind. All got tarred with the same brush. But the internet seemed to redress the balance.

For a start, the speed and reach of the internet meant that a good or a bad reputation got spread ten times faster than in the old-days. More importantly, much of the so-called precious, hidden, ‘expert’ information was now available for all and sundry to see. It took a few clicks of Google and there it was for all to see. The big ‘secrets’ were no longer so secret.

The days when people in authority abused their power were over. Hurray! At least that’s how it seemed.

But be warned, because now there is a different kind of knowledge and it is in the hands of your clients. I am referring to the half-baked, semi-, demi-, wiki-cum-people’s knowledge that is very much a mixed blessing.

Doctors now see patients who have already self-diagnosed and are in a state of perpetual anxiety as they have looked up maybe 23 potentially life-threatening diseases they may have contracted which any expert could see was flu. Lawyers have clients quoting case law as if they had been in articles for the past five years. And on and on it goes.

Now, the downside of such a situation is clear. Everyone’s an expert and a little bit of information is a dangerous thing. The upside is that clients will be savvier, more aware, and will no longer take recommendations at face value.

I see this as an opportunity. The experts, those in authority, need to recognise that their reputations have been battered. Priests, politicians, bankers and pop stars are at the top of the list of abusers. Lawyers, accountants, architects, consultants, journalists of all kinds have all had their share of damage caused by the abusers of trust. 

To stand out in this new world requires you to have a reputation beyond reproach. You need to recognise that people have always talked but now they talk to several thousand people with the single click of the keyboard.

There will always be a place for honest servants of their clients (after all you do serve your clients!) whose actions vindicate, validate and justify the trust that has been put in them. Every industry will have their abusers. You, however, need to consistently deliver with honesty and integrity.

Actions speak louder than words. Your reputation is created and spread by your clients. End of. 

We are not talking about some kind of cover-up or euphemistically called reputation management campaign. We are talking about acting and behaving with respect for your clients and their needs. All the time. Always.

Remember, a pig with lipstick on is still a pig, no matter how you look at it.

PostScript – the same applies to food manufacturers and their inability to put the advertised ingredients into their products!


image: http://www.cisi.org/bookmark/genericform.aspx?form=29848780&URL=ethics

I don't like Customer Service...

"We should celebrate how grumpy we are in the UK!"
Jack Whitehall - Live at the Apollo - British/American customer service

Mind the Gap: Service Delivery Myopia

I have been asked to gather examples of my recent study, 'Mind the Gap'. Certain individuals have seen fit to 'borrow' and misrepresent the findings (text and graphs). 

Twelve years of polls and surveys (the ‘Mind The Gap’ research, 2014) revealed that there is a significant gap between what companies believe they deliver, and what customers believe they receive. This is referred to as the service delivery gap or service delivery myopia.

You can see the original work at the following places:

• Mind the Gap - What companies are missing... the service delivery gap (Robert Craven Blog)

• The Service Delivery Gap You Are Missing (LinkedIn)

• MIND THE GAP – What companies are missing and what to do about it (Directors' Centre Business Club)

• Why businesses think their customer service is better than it actually is? (StartUps.co.uk)

• Most business seriously over-estimate the quality of the service they deliver to their customers/clients... and this impacts on profit (LinkedIn)

You can download the full pdf here

Robert Craven

The Directors’ Centre Ltd ©2014

Anti-Social Media: a rant

Social Media is not…!

Why do they call it social media? It is anything but social. It is anti-social.

What social media does can be really damaging to a business. Under the mistaken idea that they are ‘doing business’, business owners and sales/marketing people get preoccupied with social media and replace the basic, traditional forms of sales and marketing with counting clicks, likes and followers.

The bare facts are that ‘doing business’ is about understanding who your customers are, what their problems and hurts are and engaging with them in a way that they buy from you when they are ready.

Social media may be part of the recipe but it is not the recipe.

Too many people confuse talking business with doing business. They become social media-obsessed and confuse their social media interactions with their original purpose. In effect, they become busy fools.

Most businesses spend

• 75% of their time arguing over communications channels (LinkedIn or FaceBook or Instagram etc...)
• 20% of their time discussing marketing, and
• 5% of the time discussing whether they have the right product for the specific target customers needs.

This is all so wrong. So upside-down...

You need to turn this pyramid on its head and spend:

• 75% of the time discussing whether you have the right product for the specific target customers needs
• 20% of your time discussing marketing, and
• 5% of the time of your time arguing over communications channels (LinkedIn or FaceBook or Instagram etc...).

Obviously, social media done well is another matter.

image link: http://s3-eu-west-1.amazonaws.com/24dash-media/image/2008/05/08/3866/380_Image_antisocial_graffiti.jpg

Mind the Gap - What companies are missing... the service delivery gap

Here is a a copy of highlights of the Mind the Gap research paper. You can download the full pdf here

MIND THE GAP -
What companies are missing and what to do about it

Conclusions of 12 years of Service Delivery Gap Polls and Surveys, 2002-2014

Robert Craven

The Directors’ Centre, May 2014

The Directors’ Centre Ltd ©2014           

Background

The publication of Customer is King (2002) was based on the assumption that there was a gap between:

1. 1)   What companies believed they delivered, and
2. 2)   What customers believed they received.

This is referred to as the service delivery gap.

While plenty of models and anecdotal evidence existed at the time (eg Parasuraman, Zeithaml & Berry (1985), and subsequently Bain & Co, (2005)), it was felt necessary to test the hypothesis in the field. This report draws together The Directors’ Centre’s findings and conclusions of 12 years of relatively informal data gathering.

Results

A service delivery gap is reported consistently and across all sizes of business and across all sectors that we came into contact with (professional service, service and manufacturing firms).

·        80% of companies reported that they deliver an above-average customer experience.
·         Only 14% of the same companies believe that their clients think they received an above-average customer experience.
·         When asked, the actual clients (in a smaller dataset) supported the companies’ views about the customer’s experience: only 11% of the actual clients felt they received an above-average experience.

This “service delivery myopia” or “deafness” appears to be most apparent in professional service firms: the firms are the most optimistic and their clients’ reported experience is very low.

Table 1

                        

Table 2

Observations

Like male drivers, most companies believe that they are above-average. 

Paradoxically, they are not so confident as to say that their clients would agree. The clients (as suggested by the companies themselves) support the view that few supplier companies deliver above-average service levels.

The gap appears to remain relatively consistent over time and between industries.

It surprises the authors that suppliers appear to hold logical but inconsistent points of view:

• A totally unrealistic view (over-inflated?) of the customer experience they are delivering

• A totally realistic view of what their clients think of their delivery.

This cognitive dissonance, the discomfort experienced when one holds two or more contradictory ideas at the same time, seems to be buried in their psyches (Festinger, 1962).

It is argued that the delivery gap may occur for a number of reasons:

• Basic blindness or inability to take on customer feedback
• Being too much in love with one’s own product/service
• Not being close enough to the customer
• Failure to track and monitor every step of the customer journey
• Preoccupation with hard measures and statistics that sit neatly in a spreadsheet
• Forgetting the purpose, the why, of their business
• Inability to believe that there could be a better way of delivering
• Smugness that the customer is not always right
• Failure to design new products/services that exceed customer satisfaction.

The service delivery gap model developed by Parasuraman, Zeithaml and Berry (1985) identifies five different gaps and the list above could fit neatly into these five categories:


1. The customer gap: the gap between customer expectations and customer perceptions.
2. The knowledge gap: the gap between consumer expectation and management perception.
3. The policy gap: the gap between management perception and service quality specification.
4. The delivery gap: the gap between service quality specification and service delivery.
5. The communication gap: the gap between service delivery and external communications.



Consequences

It would appear that there is a cause-and-effect (chicken and egg) loop that is difficult to unpick eg does a service delivery gap cause an inability to take on customer feedback or is it the reverse?

While the cause-and-effect loop is interesting to explore elsewhere, it is believed that the consequences of these gaps impinge significantly on the profitability and sustainability of the business (Bain & Co, 2005).

A word of warning: correlation does not imply causation; a correlation between two variables does not necessarily imply that one causes the other! What is not in dispute is the consistent presence of the gap!

Key Points

Excellent customer service is difficult to deliver

While excellent customer service is easy to describe it seems to be much harder to deliver, consistently. Good relationships are hard to build and even harder to maintain.

Business myopia

Businesses seem to be blind to what the customer really wants or needs. Too much in love with their own product/service and their own processes, businesses fail to see or acknowledge how they are failing their customers.  We regularly heard statements like, “Customers don’t know what they really want”, “We still deliver the best product but customers just don’t seem to get it”.

Communications gap

Many businesses simply fail to understand who their customer is, why and when and how and where they buy the product/service. The company then proceeds to use inappropriate messages often via the wrong channels.

Confusing products and services with markets and customers

The product/service-centric view of the world is doomed in the long run; it will fail to follow the needs of customers as their tastes and technology change. The business needs to see the product/service through the eyes of the customer.

Similarity

Most businesses are competing in over-cooked marketplaces: more competitors competing on price, weary customers progressively less impressed by empty/vacuous marketing messages. Similar-looking businesses employ similar people with similar qualifications to use similar software and hardware to create similar-looking websites to sell similar-looking products to similar people at similar prices.

Five-year-old-itis

Too many businesses are still working with five-year-old assumptions about who their customer is, what they are buying, for what reason, the right price point, the right sales channel and who or what the competition really is today. Out-of-date, it is no wonder their latest P&L doesn’t match their business plans.

Hard vs Soft thinking paradox

It is argued that hard-thinking (measuring and analysing accounts) conflicts with soft-thinking (relationships and service). An impact of chasing hard results is that costs will be squeezed to maximise profits (at the cost of customer service performance).

Solutions

In some senses, the solutions feel like a return to the basics of a first year Marketing 101 course. Somewhere along the way, businesses have lost the plot. The key is to design the customer journey through the eyes of the customer. The following strategies and initiatives will start to address the service delivery gap issues:

• Get customer-centric
• Identify key target customers
• Create a clear value proposition and a clear message and voice
• Design and align sales, marketing and operations
• Use the appropriate channels to communicate.

Background

This was never intended to be an intellectually rigorous piece of research but simply a privately-funded survey to get an understanding of some of the key behaviours and drivers in this field.

There has been much talk of customer experience and also of service under-performance; the survey was designed to test some crude assumptions and propose some conclusions.

Commentary

Everything and nothing has changed between 2002 and 2014. On the one hand, communication, design, production and distribution are cheaper and faster than ever. On the other hand, there is still a need to engage, on a personal level, and to respond to customer wants and needs in a way that they find accessible and compelling. Businesses that fail to address these apparently contradictory pressures will fail in the marketplace. (Think of Encyclopaedia Britannica, Kodak and Blockbuster.)

The high scores for the companies’ belief that they deliver an above-average experience is supported by polls taken at  the same meetings asking businesses to produce scores for their financial, their marketing and their operations effectiveness. Crude results from just over 20,000 participant scores are:

• Financial performance: 6
• Marketing performance: 4
• Operations performance: 8

Owners and directors clearly believe that they do deliver a high quality operation (their product/service). This supports the fact they would also believe that they deliver an above-average customer experience. It appears they might be too much in love with themselves!

References

Allen J & Rigby D - The Consumer of 2020, Global Agenda, Jan 2005 Bain & Co - Closing the Delivery Gap, 2005 Craven R - Kick-Start Your Business, 2001 Craven R - Bright Marketing,  2007/11 Craven R - Customer is King, 2002/2014 Craven R - Grow Your Service Firm, 2011 Festinger L - Cognitive Dissonance, Scientific American, 207(4), 93-107, 1962 KPMG  - 7 Steps to Better Customer Experience Management, 2011 Levitt T - Marketing Myopia, Harvard Business Review, 1960 McKinsey - Why Most B2B Marketing Messages Fail to Move the Customer, 2013 McKnight S - Bridging The Gap Between Service Provision and Customer Expectations, Emerald 10, 2009 Parasuraman A, Zeithaml VA & Berry LL - A Conceptual Model of Service Quality and its Implications for Future Research,  Journal of Marketing, 1985 Shahin A & Samea M - Developing the Models of Service Quality Gaps: A Critical Discussion, Business Management and Strategy, 2010 Temkin Group - The ROI of Customer Experience, 2012 You can download the full pdf here
The Directors’ Centre Ltd ©2014

 Appendix

About the Author

Robert Craven, BSc(hons), Economics and Politics (Bath) and MBA (Warwick Business School) is Managing Director of The Directors’ Centre Ltd.

Formerly Director of Consultancy and Training, and Teaching Fellow, at Warwick Business School’s Centre for Small and Medium-sized Enterprises and Visiting Professor at ESC Toulouse. He is currently Programme Director (Export Growth Masterclass) at Cranfield School of Management. Robert has written six, and co-authored two, business books aimed at helping the owners and directors of growing businesses.

www.robert-craven.com

About The Directors’ Centre

A management consultancy that focuses on delivering sales and profit results to the directors of growing businesses. Led by Robert Craven, it is know for a free-of-nonsense approach to helping clients run the businesses they really want to run. Its approach is highly practical and results-oriented. Clients include: Bingham’s, Hobbs House Bakery, Barclays, AirBus, Sandals, LandRover Jaguar, Ritz Carlton.

www.directorscentre.com

You can download the full pdf here

The Directors’ Centre Ltd ©2014