Book Summary: Human Sigma – Managing the Employee-Customer Encounter By John Fleming and Jim Asplund
Jim Clifton, the president 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 the willingness of people to work and the creation of jobs. There are 7 billion people in the world today and the economy is global. This is a great competitive stage. I am an entrepreneur at heart and my job is to start and grow businesses that create jobs. I really want to understand and harness human performance.
One thing that makes companies grow is employee and customer engagement. Human Sigma speaks to this interaction specifically.
Why is this important to me?
I am not doing this summary to waste your time. My vision is to provide concise action steps you can take right now to improve your life. According to Gallup, 9% of employees are ENGAGED, 71% are DISCONNECTED, and 20% are ACTIVELY DISCONNECTED. To put this in perspective, let’s do some simple math. Let’s say your business generates $50 million in revenue per year and there are 5 million impressions. Impressions are calls, emails, website visits, 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 offline, which means impressions will be negative. The lost business potential of 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 statistics and smart companies are doing just that. If you want to laugh a little, watch the movie Office Space. The movie is funny in a painful way because a lot of the action actually happens in the corporate world.
Human Sigma is divided into 15 more chapters and is packed with detailed information. With so much information and limited time, I’d like to summarize the what, why, and how to improve 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, you will understand the problem that transcends the repetitive tasks of the left brain and the creative work of the right brain. Henry Ford dominated MASS Production. He needed physical work. At the time, this required strict management control and a curtailment of workers’ freedom. I can attest to this because I worked in a car factory for 4 months and it is NOT an easy job. The shift starts at 6 am; you get two 10 minute breaks and a lunch. This work is highly repetitive and left-handed in nature.
2. Six Sigma – This is a process to improve processes. This has worked wonders in manufacturing because it’s all about machines, tolerances, and supply chain. The improvements achieved in the last 25 years have been amazing, but this does not work for human engineering.
3. Right Brain: Work in the information age is creative by nature. According to Gallup, 89% of the value of the Fortune 500 consists of intangible assets. This means things like talented people, intellectual property, goodwill, and customers. These things can’t be handled the old-fashioned way. Have you ever wondered why Van Halen or Guns and Roses had problems? Managing creative talent with old-school management tactics doesn’t 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 to 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 is compounded over time for amazing results. Every organization needs to master this if it wants to be alive in the future.
2. Why: It is impossible to legislate genuine human interaction. Have you ever called a company to have a representative abroad answer you? They proceed to tell you that his name is John, which you know is not true. This simple act puts the customer in a state of mistrust from the start. How about being stuck in voicemail hell for the first 10 minutes of your call not counting hold time? Once he meets with an agent to help him, they are so programmed that the help doesn’t leave him feeling good about the company.
3. Why – Cost Centers. I never understood why billion-dollar companies would view 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 must be given tools, autonomy and directional freedom.
4. Why – Financial impact. As stated above, improving and focusing on joint employee and customer engagement correlates positively with impact on the bottom line. Increase engagement and organizations will grow faster and be more profitable.
Let’s look at 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 harness this can transform engagement. The human being has a need for self-realization. Achieving this from a business perspective is feasible once the front line has the freedoms and training to do so.
2. How – Do to others. Treat customers and employees the way you want to be treated. Here is a simple test you can use to magnify problems. It’s called the grandma test. Compare these two statements: “Sorry, but that’s our policy, no refunds after 10 days” with “Sorry, but this is our policy, no refunds after 10 days, Grandma.” Using Grandma at the end of their company policies shines a light on how stupid they really are.
3. How – Customers want relationships. Customer satisfaction is not enough. To generate real engagement, you need customer loyalty, and for that you need to build relationships. People don’t want to engage with actively disengaged employees, so you need to empower your people to be engaged.
4. How – Hire well. This is really the basic movement for any organization. If you are recruiting for customer-oriented people, then you need to find people who are bubbly, friendly, personable, and intelligent. If you take the time to hire at that point, the how becomes more of an organizational change rather than trying to change people.
Human Sigma is a great book that really shines a light on the customer-employee engagement model. This should be required reading for organizations looking to scale and grow.
I hope you have found this brief summary useful. The key to any new idea is to work it into your daily routine until it becomes a habit. Habits are formed in as little as 21 days. One thing you can take away from this book is that performance is tied to engagement. Focus on employee and customer engagement and make it your mission to improve it. If you do this, the money, growth and success of the company will follow. You’ll see results like more customer advocates, less employee turnover, and more referral business.
