Book Summary: Human Sigma – Managing the Employee-Customer Encounter By John Fleming and Jim Asplund
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Jim Clifton, the chairman of Gallup wrote a great book called the Coming Jobs War. In the book, he describes that one thing moves a society forward and that is people’s willingness to work and the creation of jobs. There are 7 billion people in the world today and the economy is global. This is a huge competitive stage. I am an Entrepreneur at heart and my job is to start and grow companies that create jobs. I really want to understand and harness human performance.
One thing that grows companies is employee and customer engagement. Human Sigma talks about this interaction specifically.
Why is this important to me?
I am not doing this summary to waste your time. It is my vision to provide concise action steps that you can adopt right now to enhance your life. According to Gallup, 9% of employees are ENGAGED, 71% are DISENGAGED and 20% are ACTIVELY DISENGAGED. To put this into perspective, let’s do some simple math. Let’s suppose your company does $50 million in revenue per year and there are 5 million impressions. Impressions are calls, emails, website hits or anything where your people touch a customer, lead or prospect. Each impression in this example is worth $10. Remember that 20% of your people are ACTIVELY disengaged which means the impressions will be negative. The lost business potential of the 20% negative impressions is $10 million in lost revenue per year. The math looks like this: 5 million impressions x 20% Negative x $10.
As you can see there is a real need to improve these stats and smart companies are doing just that. If you want to have some laughs then watch the movie Office Space. The movie is funny in a painful sort of way because plenty of the actions really happen in the corporate world.
Human Sigma is broken down into 15 plus chapters and is packed with detailed information. Since there is so much information and limited time, I would like to outline the What, Why and How for improving customer and employee engagement based on the research in this book.
1. What – Terminator Management- What is the problem? Human Sigma talks about the Terminator School of Management. If you consider the industrial revolution then you will understand the problem that transcends from left brain repetitive tasks and right brain creative work. Henry Ford mastered MASS Production. He needed physical labor. At the time this called for tight management control and reduction in freedom for the workers. I can attest to this because I worked in a car factor for 4 months and it is NOT easy work. The shift starts at 6am; you get two 10 minute breaks and a lunch. This work is highly repetitive and left brained in nature.
2. Six Sigma – This is a process to improve processes. This has worked magic in manufacturing because you are dealing with machines, tolerances and supply chain. The improvements garnered in the last 25 years have been staggering but this does not work for human engineering.
3. Right Brain – Information Age work is creative by nature. According to Gallup, 89% of the Fortune 500 value consists of intangible assets. This means things like talented people, intellectual property, good will and customers. These things cannot be managed the old way. Have you ever wondered why Van Halen or Guns and Roses had problems? Managing creative talent with old school management tactics does not work.
Let’s dive into the Why and look at four impacts.
1. Why – Let’s now dive into more detail and why this needs to change and why customer-employee engagement is crucial for competitive advantage. An important factor is the fact that companies with more engaged team members grow 2.6 times faster than their counterparts. This advantage overtime compounds to staggering results. Every organization needs to master this if they want to be alive in the future.
2. Why – It’s impossible to legislate genuine human interaction. Have you ever called a company to have an overseas representative answer? They proceed to tell you their name is John which you know is not true. This simple act puts the customer in a dis-trust mode right from the beginning. How about being stuck in voicemail hell for the first 10 minutes of your call not counting hold time. Once you do encounter an agent to help, they are so scripted that the help does not leave you feeling good about the company.
3. Why – Cost Centers. I never understood why companies that generate billions of dollars would view the front line team members as a necessary evil. These people interact with customers. Customer service call centers are still notoriously bad after all these years. They should be given tools, autonomy and directional freedom.
4. Why – Financial Impact. As stated above, improving and focusing on employee-customers engagement together is positively correlated to impact the bottom line. Increase engagement and organizations grow faster and are more profitable.
Let’s examine four things you can do right now.
1. How – Maslow’s hierarchy of needs. Customers and employees have the same hierarchy of needs. Companies that tap into this can transform engagement. Human beings have a need for self-actualization. Achieving this from a company perspective is doable once the frontline is given the freedoms and the training to do it.
2. How – Do unto others. Treat customers and employees the way you want to be treated. Here is a simply test you can use to magnify problems. It is called the Grandma test. Compare these two statements: “I’m sorry but that is our policy, no refunds after 10 days” to “I’m sorry but this is our policy, no refunds after 10 days Grandma.” Using Grandma at the end of your company policies shine light to how stupid they really are.
3. How – Customers want relationships. Customer satisfaction is not enough. To build true engagement you need customer loyalty and for that you have to build relationships. People do not want relationships with actively disengaged employees so you need to empower your people for engagement.
4. How – Hire Right. This really is the staple move for any organization. If you are staffing for customer facing people then you need to find bubbly, friendly, nice and smart people. If you take the time to hire right then the how becomes more of an organization change instead of trying to change people.
Human Sigma is a great book that really sheds light on the customer-employee engagement model. This needs to be required reading for organizations that want to scale and grow.
I hope you have found this short summary useful. The key to any new idea is to work it into your daily routine until it becomes habit. Habits form in as little as 21 days. One thing you can take away from this book is performance is tied to engagement. Focus on employee and customer’s engagement and make it your mission to improve it. If you do this then the money, growth and company success will follow. You will see results like more customer advocates, less employee turnover and more referral business.