Focusing on the Fundamentals

of Excellence

For the past 22 years…

What does this mean to me?

How can I use this idea?

What can I do right away?

Organization Effectiveness Audit

Page 2

Be “Brutally Honest”Scale of 1 – 10

The Four – I’s

• Ignorance• Inflexibility• Indifference• Inconsistency

3

How to avoid the Four I’s

• Aggressive external market focus.

• Ridiculously high level of customer focus.

• Keep the “Main Things” the main things.

• Bullish on knowledge sharing and learning.

• Teamwork / communication is mandatory – not optional.

• Passion and commitment at all levels.

• Foster a healthy paranoia.

• Revel in change.

3

1 - 10

The Pattern of Business Success

(T + C + ECF) x DE = Success

Talent

Talent + Culture

Cecil Van Tuyl

“It is all about people, people, people. You can kid yourself about a lot of things in your business, but at the end of the day it will always come down to people.”

The level of highly satisfied and engaged EMPLOYEES in your business.

The number one factor in increasing the level of highly satisfied and engaged CUSTOMERS in your business is…

4

Key Drivers of Customer Satisfaction and Loyalty

Financial Performance

Quality P&S&

Customer Relationship

EmployeeSatisfaction

Empowerment High Standards

Long-termOrientation

Enthusiasm, Commitment,

Respect

Training &Development

Fair Compensatio

n

CR= 104.12% increase in profits

CR= .404

CR=.334

CR=.277

CR=.275CR=.249

CR=.280 Coaching

CR=.285

CR=.371

CR=.365

CR=.191

CR=.247

TolerateNothing

Less

From: Practice What You Preach by Maister

Global study:16 countries529 companies15,589 respondents

4

Workshop Page 51 - 10

Customer satisfaction drives customer loyalty… and customer loyalty drives profitability

100%

90

80

70

60

50

40

30

20

Extremely Dissatisfie

d

SomewhatDissatisfie

d

SlightlyDissatisfie

dSatisfied

Very Satisfied

Zone of Defection

Zone of Indifferenc

e

Zone of Affection

Loyalt

y

Customer Satisfaction

Terrorist

Evangelist

A 5% increase in loyalty among your best customers…

Can produce a profit increase of 25% – 85%

I hate you

I don’t care about you

I love you

NITB

Actively disengaged employees can reduce revenues by up to 22%, while highly satisfied and engaged

employees can drive profits up by as much as a 189%

Culture = Cash

What do engaged employees look like?

1. They give more discretionary effort.2. They consistently exceed expectations.3. They take more responsibility and initiative.4. They receive better customer service ratings.5. They offer more ideas for improvement.6. They promote and model teamwork.7. They volunteer more for extra assignments.8. They anticipate and adapt better to change.9. They persist at difficult work over time.10. They speak well of the organization.

Page 61 - 10

6

74%23,000,000

88%

What they look for in a leader…

Credibility

1.Honest2.Forward-looking3.Competent4.Inspiring

NITB

What Employees Want: SBA

Focus me

Know me

Care about me

Hear me

Help me feel proud

Equip me

Help me see my value

Help me grow

Help me see my importance

The key elements of a winning culture: Employees

• Fun• Family• Friends• Fair• Freedom• Pride• Praise• Meaning• Accomplishment

7

1 - 10

The Six Universal Drivers of Engagement

1. Caring, competent, and engaging leaders.

2. Effective managers who keep employees aligned, informed and engaged.

3. Effective teamwork at ALL levels.

4. Job enrichment and professional growth.

5. Valuing employee contributions.

6. Genuine concern for employee well being.

1 - 10

7

1,300,000 interviews: Basic 4 + 1

Goal Setting

TrustAccountability

Communications

RECOGNITION

From: The Orange Revolution by Gostick and Elton 8

Extreme Customer Focus

Web of Value: VOC + MOT + WOM

VOC

How Many of these do you employ?

Moments Of Truth

MOT Practice Round

Dry CleanerHair SalonTailorPlumber

Workshop VOC + MOT

9

43% - 74% of purchasing decision = WOM/T

WOM = Your BEST form of advertising!

78.9%23.4%

You MUST have a WOM Referral System

Identify Ideal

Customer

ReferIdeal

Customer

From John Jantsch: The Referral Engine

Workshop: Five ways to generate WOM

10

The Evergreen Project

10 year study of 160 top companies

40 distinct industries

200 management practices

Winners, climbers, tumblers, losers

Winners had an average Total Return to Shareholders of 945%...

The Losers only averaged a TRS of 62%

From: What (really) Works by Joyce, Nohria, Roberson 11

The Four Primary Practices:

1. A sharply focused, clearly communicated and well-understood strategy for growth.

2. Flawless operational execution that consistently delivers the value proposition.

3. A performance-oriented culture that does not tolerate mediocrity.

4. A fast, flexible, flat organization that reduces bureaucracy and simplifies work.

From: What (really) Works by Joyce, Nohria, Roberson 11

The Secondary Management Practices:

• Talent = find and keep the best people.• Key leaders show commitment and

enthusiasm for the business.• Embrace strategic innovation.• Master the power of partnerships.

From: What (really) Works by Joyce, Nohria, Roberson

Score yourself on the 1–10 scale for all eight practices on page 11

10 – 15 %

What Inhibits Execution?National Survey of 4,000 Senior Executives

4. Inability to work together (21%)

3. Company culture (23%)

2. Economic climate (29%)

1. Holding onto the past / unwillingness to CHANGE (35%)

In other words…

• In order to succeed you need a high-performance team that embraces a strong culture of disciplined execution and accountability while being nimble, agile and adaptable to changes in the marketplace.

Workshop Page 12

Very Clear Expectations

Specific and Measurable Goals

Necessary Systems & Support

Robust Communication

Consistent Tracking of Performance

Timely Performance Reviews

Refuse to Tolerate mediocrity

Final Workshop

Strategy map on page 13

Business excellence “Word Cloud” on page 14

Specific assignments pages 15 - 17

If you have any questions at all please do not hesitate to send a note or call. My email address is: john@johnspence.com

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Lastly, these slides have already been uploaded to:

www.slideshare.net/johnspence

Thank You