3 | Customer
Acknowledging Innovative Excellence – K&N Management
Can you imagine every fast food chain winning the Baldrige Award because of food quality, customer service, or innovative menus? Probably not. Why? Because most of them demonstrate it’s all about low price and average service. Well, here is an exception.
K&N Management was a 2010 recipient of the Malcolm Baldrige National Quality Award, and 2010 Texas Award for Performance Excellence. Their vision is “to become world famous by delighting one guest at a time.” As a restaurant management group, they were only the second of their kind to be recognized with a Baldrige Award. K&N operates out of Austin, Texas, and is the owner of Mighty Fine Burgers, Fries and Shakes, as well as Rudy’s Country Store and Bar-B-Q, with eight locations and approximately 500 staff members in total. With a dedication to concept design, operational excellence, and meeting or exceeding key guest requirements, K&N Management is certainly worth taking a second look at.
K&N was started by Ken Schiller and Brian Nolen in Austin back in 1993, with the goal of delighting every guest that walked through their doors. By the next year, they had purchased the rights to the Austin-area Rudy’s Country Store & Bar-B-Q franchise, and opened the first store: a combination gas station, convenience store, and restaurant that specializes in smoked meats. By 2005, three more franchise locations had been …
10Oct2012 | Joseph A. De Feo | 1 comment | Continued
The Three C’s of Customer Retention: Character, Community, and Content
In a recent Fast Company article, Noah Fleming reflects on the importance of a company’s character in an article titled, “Why Is Jeff Bezos Always Talking To Me?” He writes about the frequency of which there are letters from Amazon CEO Jeff Bezos displayed on the site’s homepage, usually referencing a significant product launch (like the free availability of the Harry Potter series in the Kindle Owner’s Lending Library), or, like last week, the anniversary of Amazon Prime. These types of announcements serve a number of purposes, but Fleming makes an excellent point about one particular one.
“Character is about positioning,” the author states, “you can either decide what those few things (that people remember) will be, or let the market decide.” Jeff Bezos is working hard to create customer retention by emphasizing his personal connection with the company, and therefore, with his customers. He is deciding what the most important things are for the customer to remember as they come and go from his site, and attempting to leave them with a lasting memory of something positive. Does your company do something similar to this?
In an article published last February by Simon Mainwaring, entitled “What Brands Must Do Now to Engage Their Customer Communities,” it was noted that brands must be change agents for their own right. As community mentors…
6Sep2012 | Joseph A. De Feo | 0 comments | ContinuedCustomer-Driven Excellence
Performance and quality are judged by an organization’s customers. Thus, your organization must take into account all product features and characteristics and all modes of customer access, in addition to support that contributes value to your customers. Such behavior leads to customer acquisition, satisfaction, preference, and loyalty; to positive referrals; and ultimately, to business expansion.
Customer-driven excellence has both current and future components: understanding today’s customer desires, as well as anticipating future customer desires and marketplace potential. Value and satisfaction may be influenced by many factors throughout your customers’ overall experience with your organization. These factors include your organization’s customer relationships, which help to build trust, confidence, and loyalty. Customer-driven excellence means much more than reducing defects and errors, merely meeting specifications, or reducing complaints. Nevertheless, these factors contribute to your customers’ view of your organization and thus, also are important parts of customer-driven excellence. In addition, your organization’s success in recovering from defects, service errors, and mistakes is crucial for retaining customers and engaging customers for the long term. A customer-driven organization addresses not only the product and service characteristics that meet basic customer requirements but also those features that differentiate the company from its competitors. Such differentiation may be based on innovative offerings, multiple access mechanisms, rapid response, or special relationships.
Customer-driven excellence is thus a strategic concept. It is directed toward customer …
27Aug2012 | Joseph A. De Feo | 0 comments | ContinuedMarketing Customer Service
In our dynamic business world, where consumers are constantly revising their preferences and trying to make their own small businesses (their homes) run smoothly, business leaders need to ensure their company is honing its services to those evolving customer needs. Revisiting the Baldrige Criteria can keep us in check by reminding us how important it is to respect customer individuality. As explained in its customer focus section,
“Knowledge of customers, customer groups, market segments, former customers, and potential customers allows your organization to tailor product offerings, to support and tailor your marketing strategies, to develop more customer-focused workforce culture, to develop new business, and to ensure organizational sustainability.”
This certainly seems pretty straightforward, but the knowledge of your customers, and development for customer-focused workforce culture are carrying heavier weight than ever in today’s economy, and business leaders need to act fast to keep up. The meaning of customer respect and service is essentially becoming a leading marketing asset for businesses aspiring for success, versus just a “good idea.” Quality customer service can have a greater impact on your business than quality marketing.
Author of Leadership Matters: CEO Survival Guide, Mike Myatt, is an expert in business leadership and recently contributed in Forbes magazine about the absolute need for companies and organizations to utilize the opportunity this generation holds for prosperity in a …
11Jul2012 | Joseph A. De Feo | 0 comments | ContinuedCustomer Significance in Product Development
The customer is potentially the most important element of a successful business equation. The Baldrige Criteria asks organizations how they engage their customers, how they communicate with them, and how they attract an ever-growing audience of captivated, satisfied customers. A recent blog post on the Harvard Business Review (HBR) by authors Donald Reinertsen and Stefan Thomke entitled, “Customers Don’t Want More Features” touches on these points that are worth reiterating.
Reinertsen and Thomke explain a common myth about product development that revolves around more features being added into a particular product directly relating with customer satisfaction. The thought is that customers will always choose the product that has more options, add-ons, features, extras, and doodads, due to the assumption of those features “adding value.” On the contrary, simplified and “base model” products are perceived as being less valuable. The HBR authors make an excellent point, “This attitude explains why products are so complicated: Remote controls seem impossible to use, computers take hours to set up, cars have so many switches and knobs that they resemble airplane cockpits, and even the humble toaster now comes with a manual and LCD displays.”
Rather than buying into this traditional approach of product development and adding more feature layers with every new model, innovative companies start with defining the problem. By developing a clear understanding of what the …
6Jun2012 | Joseph A. De Feo | 0 comments | ContinuedThe Economics of Customer Loyalty
This article is part of an on-going series on Customer Loyalty and Customer Satisfaction
Profitability is correlated in a positive way with customer loyalty. While we have confirmed this with empirical evidence for a variety of clients in a wide range of industries, it is interesting to consider why the relationship should exist. Exhibit 1 shown below summarizes the reasons. First, simply keeping a target customer longer means the cost of churn, or replacing lost business with new business, is reduced. While Exhibit 1 depicts a relationship with a single customer, the same principle applies to portions of large business customers. Time and again, we have seen companies managed for market share, which gain share only by incurring great churn. These companies tend to realize a lower average price and have a higher delivered cost than their competitors with lower rates of churn – even if the competitors have a lesser share of the market. Customer acquisition cost, while not ordinarily accounted for by the finance department, can be significant. Improving customer loyalty reduces the significance of this cost of poor quality.
A variety of extra “chunks” of value accrue as a customer’s loyalty level increases. These are shown in Exhibit 1: profit from referrals; profit from price premium; profit from broadened purchasing; profit from co-development of products & services and profit from …
17Apr2012 | Tom Huizenga | 0 comments | ContinuedQuality and Customer Loyalty Goals
This article is part of an on-going series on Customer Loyalty and Customer Satisfaction
Customer loyalty can be defined as a bond between a supplier and target customer, reflected by the customer’s consistently spending most or all of its entire budget on the supplier. Two important aspects of this very simple definition deserve elaboration. Retaining a customer by no means results in getting all, or even most of its budget. Managers often think they do not have a customer loyalty problem because the names on the customer list have not changed in ten years. In our experience, these same managers inevitably find their businesses would be more than twice the current size were they to win the entire budgets of their existing customers for competing products or services.
The second important aspect of the definition above is the “target customer” part. In fact, there are certain customers whose business, let alone loyalty, you do not want. The story of two general merchandise retailers is a case in point. Analysis showed that very seasoned customers of Company A, the historical market leader, (now number two in the industry) became proficient at scanning the Sunday papers for specials, and would essentially “cherry pick” the retailer of low price/low margin merchandise. While Company B, the (then) number two competitor retained customers at a lesser rate, their customers: (1) …
11Apr2012 | Tom Huizenga | 0 comments | Continued
