The power of leadership

THERE is a famous research project that became known as the "Grandma Knows Best Study". Critics, on first reading the report, jumped to the conclusion that it contained little or nothing that our grandmothers could not have told us. Deeper and more intelligent reading showed, however, that the study contained information that was novel and of major value.

By Professor Tom Lambert Frsa

Published: Sun 18 Nov 2007, 8:44 AM

Last updated: Sat 4 Apr 2015, 11:18 PM

It is to be hoped that a new study by Towers Perring will not be dismissed in the same superficial and cynical way. Although, of necessity, the 2007 Global Workforce Study will repeat information that is already well-known, deeper and more thoughtful examination will be rewarded.

The obvious and the important

90,000 participants were surveyed in a wide range of businesses and in many companies world wide. The result has been to achieve a comprehensive and useful "snapshot" of what is important to today's global workforce.

Some of the results are very much as expected. Workers are concerned with their earnings, job security, vacation time and benefits in the wealthier countries.

Employees in other countries either share these concerns, or wish that they worked in conditions that allowed them the opportunity to value similar benefits. More important, however, is a widespread concern for the quality of leadership and management and the effect that has on the future prosperity of the enterprise.

Peter Drucker said that the primary goal of an enterprise should be to "perpetuate itself". Prosperity only comes and can only be sustained with survival. Survival in a volatile market place is a function of whether worthwhile customers are "prepared to come to you first and to keep coming to you with their business".

What is perhaps a little more unusual is the growing understanding by workforces as well as their management that the key to keep customers happily beating a path to your door is the role model and attitudes of management from the boardroom to the shop floor.

Only if I believe that those that are at the head of the enterprise are genuinely "walking the talk" of real customer care will I, as an employee, do what is needed to consistently delight customers while ensuring the lowest possible drain on resources and profits.

To put that another way, I will care only if top management care and unless I care, nobody really cares and the enterprise will fail.

Are managers up to the task?

Less than 40 per cent of international workforces believe that they are. A mere 38 per cent believe that the top team in the company that employs them has any concern for their welfare.

If managers do not care about employees, employees will not care about customers and if employees do not care about delighting customers you are soon out of business. With increasing competition any neglect of customers or employees creates a circle that is vicious indeed.

Twenty years ago this was less important. The average company was able to retain most of its customers because they had nowhere else to go. According to research by Harvard, the average "mature" business organisation could continue in being, whether its customers and employees were valued or not, for 60 years. Within a decade this "life expectancy" fell to twelve years on average. Today it is much less.

Market transparency

Thanks to the Internet amongst other comprehensive market communications a majority of even "delighted" customers prefer to look elsewhere before they buy again in case somebody else, somewhere else, can provide superior service and value. Unhappy customers can damage a company irreparably, but unhappy customers are only the tip of a very dangerous iceberg. Journalists, bloggers and even undervalued employees can access a readership of millions by going online with concerns, complaints or "whistle blowing". The relationship between employee and customer is ever more vital and this relationship is only positive when employee and customer both belong to a committed group that consistently regards itself as a genuine stakeholder in your company and an investor in its ongoing success.

Not the fancy title — the appropriate action

There was, and to a degree still is, a psychological truth — Idiosyncrasy Balance — that those that had been legitimised by a senior position within an organisation could rely on that position and the title that goes with it to influence the behaviour of others. Today that capability, like the "life expectancy" of an increasing number of companies is of short duration. There is global competition for talented people and talented employees are not influenced for long by titles and formal hierarchies. Unless the whole of the management team is ready and able to demonstrate its commitment to the worthwhile customer, both customer and talent will, sooner or later, go elsewhere.

A thing of the past?

Like it or not, the bond of loyalty has loosened and those that are incapable of inspiring employees and customers to be genuine ambassadors of the business will soon have no business. With less than 40 per cent of managers bothering to communicate the reasons for key decisions affecting the customer to employees how will employees communicate them to the customers with whom they have a relationship? Do not assume that everything will be fine if senior management communicate directly with the customer and ignore the "man in the middle".

I experienced this as a district manager with an automotive manufacturer many years ago and I can assure you that my dealers were as angry as I was to find that I, who had to help my dealers to grow and prosper had no information about the basis on which a "head office" decision had been made because the board believed that they "knew best". Often they did not and eventually their hubris led to the demise of a company that had for many years had dominated the market. Talented people that build worthwhile relationships with customers are an essential part of the team and if the individual is ignored the team is damaged and the goal is usually missed.

The price of fish

In today's volatile business environment the customer has many and varied companies attempting to win his business. Blandishments of every kind combine with tales of woe to drive even the satisfied customer to explore other options. Your best defence is to have capable employees working closely with valuable and valued customers to build relationships that ensure that your people understand the emergent and evolving needs of those special customers that your organisation must retain in order to prosper. Employees will only value customers or company if they believe that they in turn are valued. Your behaviour and that of every one of your senior colleagues' counts. You may not get another chance so if research is published that appears to be repeating the obvious do not assume that your grandmother could have told you as much and look more deeply for the relevance of research to your future prosperity.

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