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Editor: Dr. Wolf J. Rinke **** Feel free to forward this eNewsletter to others. **** IN THIS ISSUE 1. NEWS YOU CAN USE 2. DOUBLE YOUR PROFITS WITH A SERVICE GUARANTEE 3. HOW TO GET YOUR PROBLEMS SOLVED 4. WINNING ACTION STEPS 5. FREE STUFF AND SPECIAL OF THE MONTH 6. HUMOR BREAK 7. CONTACT AND SUBSCRIPTION INFORMATION ======================================================== REALITY CHECK The best way to drive your competition crazy is to make your customers happy. —Guy Kawasaki ======================================================== 1. NEWS YOU CAN USE ======================================================== EMPLOYEE LOYALTY IS A THING OF THE PAST Only 42% of the nation's employees consider themselves loyal to their jobs and about a fourth plan to stay at their current job for only two years. Why? According to a nationwide study by the Hudson Institute and Walker Information of Indianapolis, 56% of 2,300 employees surveyed feel that their employers fail to show concern for them, 45% said that their employers treat them fairly, and only 41% feel that their employers trust them. With turnover at a 20 year high, the impact on corporate performance and the bottom line is debilitating. SOLUTIONS: 1. Pay slightly more than the competition. 2. Measure job satisfaction at least once a year. And put a plan into effect that increases it by 10% every year until it is about 99%. 3. Provide employees with career growth opportunities either in your company or another. 4. Trust all of your employees all of the time until they prove you wrong. 5. Provide an opportunity for your employees to experiment. 6. Give your employees more power than you think is wise. 7. Reduce the number of rules and standard operating procedures by 50% this month. Continue cutting them by 50% until you are down to the absolute minimum. 8. Ask for volunteers to serve on a "Fun Team" who is responsible to insure that work is fun. 9. Spend at least 66% of your time with your team members. 10. Show a real interest in your employees personal lives. 11. Ask your employees often: "What can I do to make your job easier?" 12. Love, yes I said LOVE, your employees the way they are, not the way they ought to be. Source: Walker Information, Indianapolis, www.walkerinfo.com STRESS AT WORK IS BECOMING DYSFUNCTIONAL Stress induced sick leave tripled in the U.S. from 1995 to 1996. According to Joe Robinson, editor of Escape magazine, half of all Americans report some type of stress, and 63% say they would rather have more time off than more pay. The U.S. is the most vacation starved country in the world. The number of legally mandated vacation days for the top industrialized countries in the world are as follows: Sweden-32; Spain, Denmark, Austria and France-30; Ireland, 28; Japan, Portugal and the Netherlands-25, while the average number of vacation days for the U.S. is 16 days per year. However small business employees only get eight days off. Note that this is an average since the U.S. has no legally mandated requirements. SOLUTION: Provide your employees with a minimum of two weeks of paid vacation per year. Go to 3 weeks after 1-3 years, and to 4 weeks after 5-8 years of employment. They will become MORE productive, have fewer absences and reduce your health care expenses. Source: www.Escapemag.com ARE YOUR ETHICS SHOWING? One in three employees regularly observe ethical misconduct at work, such as "managers or coworkers lying, withholding information, abusing or discriminating against employees." However only a half are willing to report these abuses. The rest are fearful of being labeled as a "trouble maker." The survey of 1,500 employees, conducted by the not-for-profit Ethics Resource Center in Washington, DC, further reported that one in eight employees feel pressure to compromise their companies ethical standards. This in spite of the fact that 80% of all companies have ethics training programs or ethical codes of conduct in place, and 90% of employees surveyed stated that they want their employers "to be concerned with more than just profits. In fact the finding s revealed that employee job satisfaction was higher "when their employer tried to do what was right and not only what was profitable." SOLUTION: Do right! Your employees will take their cue from your ACTIONS not your words. The best ethics training programs are a waste of time if your actions are perceived to be unethical. First do right because it is the right thing to do. Second do right because it will help attract and keep high quality employees. And third, do right because over the long term it will have a positive impact on the bottom line. Source: The Sun, 6/14/00, pp. 3A &C ======================================================= 2. DOUBLE YOUR PROFITS WITH A SERVICE GUARANTEE by Wolf J. Rinke, PhD, CSP ======================================================= Recently, "Superwoman"—that's my wife of 31 years—and I went to a well known Italian national chain restaurant to have dinner while we were waiting to get a new set of tires put on her car. We informed the host who seated us that we needed to get in and out in about 45 minutes. (We had to get back to the tire store before they closed.) We were seated right away. However then waited for about five minutes before the server—lets call her Debbie—came to the table. Both of us immediately got turned off because of her impersonal mannerism. No "hello", no "Thanks for coming to dine with us." In short nothing made us feel welcome. And I don't know about you but when Superwoman and I go out to eat we go for the experience. Good food, is our expectation. Personal and friendly service is what will exceed our expectation—especially since it is becoming almost extinct. We told her of our time constraints and she assured us that she could get us served in time. The reality however was that the food seemed to arrive at the speed of molasses. At no time did Debbie stop by to give us an update. When she finally brought the food she plopped it down, and without so much of "Enjoy your food," she was off to the next table. Even though we were able to consume our meal in time it was not the pleasant experience we normally have in this restaurant. So on the way out I shared our disappointment with the host. His response was: "I'm sorry... yada, yada, yada. I'll talk to Debbie. Good night." Another opportunity to put a service guarantee to work, transform a disappointed customer into a raving fan, and grow business faster, bit the dust. How can you avoid these situations in your service organization? (Yes, you too are in the service business!) By having an ironclad service guarantee. An example of such a guarantee, according to Collins' article in the July-August 1999 issue of the Harvard Business Review, is that of Granite Rock, a 99 year old California company that is in the mundane business of selling crushed gravel, concrete, sand and asphalt: "If you are not satisfied for any reason, don't pay us for it. Simply scratch out the line item, write a brief note about the problem, and return a copy of this invoice along with your check for the balance." Effective service guarantees represent a self-fulfilling prophecy, because they promise quality and deliver it. The reason? They define for the customers and your team members exactly what they can expect in advance. Provided the service guarantee is accompanied by an effective feedback loop that is monitored and provides for ongoing correction of the service delivery system, it will pay for itself many times over. For example, Granite Rock charges a 6% price premium, and an owner of four restaurants in Seattle reported that his service guarantee resulted in an 25% sales increase and a doubling of profits. To get these kind of results your service guarantee has to be: 1. Unconditional—an example is mail-order merchant L. L. Bean's "100% satisfaction in every way." 2. Easy to understand and communicate—this means that the customer knows exactly what to expect. Example: "We will provide you with service within twenty minutes or the meal is on us." 3. Meaningful—in two different ways. First, it guarantees what is important to the customer. For example, fast service may be important to a customer who enters a fast-food restaurant, but probably not to customers who dine in a gourmet restaurant. Second, it is fair in terms of compensation when the guarantee is not met. The best example is Domino's Pizza. Originally they promised a free pizza if it was not delivered in thirty minutes. What they discovered, however, was that customers found that guarantee unreasonable and did not invoke it on a regular basis, therefore depriving Domino's of valuable feedback. Once it was changed to $3 off, customers perceived it to be meaningful and began asking for it. Of course, now Domino's has been forced to give up their service guarantee altogether because of increased expenses associated with litigation due to driver accidents. 4. Easy and painless to invoke—if the guarantee is not met, the customer should not have to go through a lot of effort or feel guilty about invoking the guarantee. This is particularly important since the customer already has been inconvenienced. 5. Easy and quick to collect—ideally the payout should be awarded on the spot with relatively little effort on the part of the disgruntled customer. 6. Trackable—provides the organization with a continuous feedback loop. This insures that mistakes are corrected and not repeated. At the same time it helps the organization become a learning organization that is continually learning and improving. To achieve total recovery, I recommend that you "plus-up" disgruntled customers. Plussing up customers means that you correct the problem as soon as possible. Then you add an additional and unexpected bonus to compensate customers for their inconvenience. For example, if a customer returns a defective product, you replace it immediately with a new one of his choice. Then you offer the customer a complimentary coupon or a free valuable gift to compensate him for the trouble and inconvenience. For example the host in the Italian restaurant could have plussed us up in the following manner: "I'm sorry sir, that's not how we like to treat our customers. After all, at XYZ we pride ourselves in delivering excellent food and exceptional service. What can I do to make it right for you?" After he would have given me what I requested—by the way 97% of all customers are extremely conservative in their requests—I would have probably said: "Don't worry about it, I just wanted you to know." After that the host should have plussed us up by offering us a coupon for a free meal, accompanied by the following words: "Sir, I would like you and your wife to give us another chance. That way you will discover that we typically deliver exceptional service. A similar message should have been printed on the coupon with a request to show the coupon to the host upon entry, so that the service team can make sure that the next experience is a "WOW" experience. When I share the "plus-up" strategy with corporate executives I'm typically greeted with howls of frustration such as: "If we did that we would be out of business." At that point, we evaluate the "life-time value" of one of their customers. (Do you know yours?) According to Dominos Pizza it is in excess of $8,000. According to General Motors it is more than $300,000 per family. Add to that the well known statistic that unsatisfied customers tell on average 12 others about their negative experiences. Which is another costly proposition since it destroys positive word-of-mouth, the only advertising that according to some experts, really works. Plus, it costs roughly five times as much to attract a new customer compared to retaining a current customer. In addition, it's been estimated that you can increase your profits by 100% by merely retaining 5% more of your current customers. All of a sudden the "plus-up" strategy looks like an extremely inexpensive strategy. So be sure to install an ironclad service guarantee in your organization, train and reward your front line team members to insure that they put the guarantee to work, implement an aggressive feedback loop so that you can correct repetitive service failures, and teach your service providers to plus-up every dissatisfied customer and you too will be able to double your profits. -------------------------------------------------------- *** NEW ** NEW ** WEB BASED TRAINING ** NEW ** NEW *** Now you and your employees can receive training the convenient and inexpensive way by enrolling on-line in a wide variety of courses. From management development to sexual harassment. All training can be tracked. Try it out for FREE today! You won't believe how easy and effective it is. Simply click on http://www.WolfRinke.com/mgttraining.html DO YOU HAVE A QUESTION, SUGGESTION OR A MANAGEMENT SUCCESS STORY? We are getting some great success stories from our subscribers, and would like to hear yours. Every story we use receives a FREE gift. Mailto:WolfRinke@aol.com. ======================================================= 3. HOW TO GET YOUR PROBLEMS SOLVED ======================================================= High employee turnover? **** Low customer satisfaction? Unproductive employees? ** Low morale? ** Lack of trust? **** Resistance to change **** Poor communication? **** Our high impact consulting services and customized management and personal development training will solve these and other "people" problems! Call us at 800-828-9653 or mailto:WolfRinke@aol.com to ********* Tired of the same boring meetings? ********* Would you like your next meeting, retreat or conference to be a "howling success"? Contact us. Dr. Rinke is a highly effective motivational and management keynote speaker and seminar leader who delivers customized presentations that combine story telling, humor and motivation with specific "how to" action strategies that participants can apply immediately to improve the quality of their personal and professional lives. Call him at 800-828-9653 or mailto:WolfRinke@aol.com ======================================================== 4. WINNING ACTION STEPS ======================================================== SUCCEED FASTER Grab your calendar right now and assess what proportion of your time was spent with either your internal or external customers during the past five working days. If it is less than 50 percent, make up an action plan that will get you to spend 5 percent more of your time with your internal and external customers during the next week. Each week thereafter, increase it another 5 percent until you spend 70 percent your time interacting with the people who have the potential to help you succeed. TEST YOUR ORGANIZATION This week, call your own company/organization and pretend you are a customer. Answer the following question candidly: Based on the initial impression, would I want to do business with this company/organization? MYSTERY SHOP NOW Next month, mystery shop your own company/organization. In the event that most service providers would recognize you, utilize a friend you trust or, better yet, hire a mystery shopper. There are companies that provide this service. YouÕll find them in a business-to-business directory. The insights you gain about your own organization will blow you out of the water. Repeat this process at least once a year. ======================================================== 5. FREE STUFF AND SPECIAL OF THE MONTH ======================================================== ### SPECIAL OF THE MONTH ### ONLY FOR SUBSCRIBERS ### Winning Management VIDEO Training System, consists of high impact 50-min. video, audio and leaders guide, by W. J. Rinke. Price: $95.00. ONLY $70.00 Plus FREE shipping (US only). $$$$$$$$$$$$$$$$$$$$ SAVE $32.00!!! $$$$$$$$$$$$$$$$$$$$$$ ###### You must mention this offer when you order!! ###### ***** 100% UNCONDITIONAL MONEY BACK GUARANTEE. ***** Order NOW! Offer expires 7/15/2000. Call 800-828-9653 or http://www.WolfRinke.com/wmprod.html For FREE articles, inspirational messages and other money saving offers on books, audio and video tapes that will help you and your company succeed FASTER visit our website: http://www.WolfRinke.com ======================================================== 6. HUMOR BREAK ======================================================== Firing British style: A manager called a secretary in to give her the bad news that she was being fired. He started the conversation with: "Miss O'Malley, I really don't know how we're going to get along without you, but starting Monday ... we're going to try. ======================================================== 7. CONTACT AND SUBSCRIPTION INFORMATION ======================================================== Dr. Wolf J. Rinke, CSP President Wolf Rinke Associates, Inc. P.O. Box 350 Clarksville, MD 21029-0350 USA (410) 531-9280, Fax (410) 531-9282 For orders in the US (800) 828-WOLF (9653) Email: Mailto:WolfRinke@aol.com Website: http://www.WolfRinke.com If this was forwarded to you and you would like to receive your own FREE subscription mailto:WolfRinke@aol.com and type the word SUBSCRIBE WM in the subject box. To remove yourself from this mailing list, please type the word UNSUBSCRIBE WM in the subject box. 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