How to Earn and Keep Customer Loyalty

Today’s buyers –– empowered by the Internet, assured by the enormous choice in every segment of commerce and capitalizing on the acute vulnerability of sellers struggling in this current selling climate –– have taken control of the entire purchase progression

The confluence of technology and choice described in Robert H. Bloom’s The New Experts, started customer loyalty down the slippery slope –– ultimately, customer loyalty died. Buyers no longer care which seller they buy from –– which gives buyers all the power. But buyers do care about fulfilling their needs and making the best purchase decision –– and that is how you can win them over at four critical customer moments.

The Four Moments That Count

1. The Now-or-Never Moment –– your first brief contact. It is impossible to overestimate the importance of your prospects’ initial contact with your company.

2. The Make-or-Break Moment –– the lengthy transaction process. Most leaders know from experience that far too many transactions fall through at the Make-or-Break Moment, the extended period of consideration, negotiation and decision to purchase.

3. The Keep-or-Lose Moment –– the customer’s continued usage. This is the period when your buyer is actually using your business’s products or services. It is important to nourish and maintain your relationship with a customer while that current customer is using, consuming, enjoying and relying on the product or service he or she purchased from you. Maintaining performance is essential at this moment.

4. The Multiplier Moment –– repeat purchase, advocacy and referral. Your Multiplier Moment is your conversion of a one-time customer into a repeat customer and an advocate and referral source for your company. Customers’ repeat purchases from your firm and enthusiastic recommendations of your firm will produce transactions that require far less investment and will create far more profitable revenue. This is why your business must sustain its performance long after the completion of the transaction and throughout your pivotal Multiplier Moment.
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What Makes Millennials Good Leaders

It’s dangerous to paint entire generations with the same brush; some tendencies or narratives can quickly become exaggerated. On the subject of Millennials and leadership, two conflicting stories often emerge: the first, that Millennials want a fast track to leadership roles without being willing to pay their dues; the second, that Millennials are not willing to accept the sacrifices — working long hours at the expense of family — expected of leaders.

A recent global study by France’s INSEAD shows that some of these narratives are misleading. According to the study, based on interviews with thousands of Millennials in 43 countries, 70 percent of the Millennials considered becoming a leader “important” or “very important,” and nearly 64 percent said they were willing to work longer hours and have more stress for the opportunities to be leaders. While past studies and books might focus on Millennials in their role as future leaders, a new book declares that the future has arrived. Millennials Who Manage: How to Overcome Workplace Perceptions and Become a Great Leader, by Chip Espinoza and Joel Schwarzbart, is written for and not about Millennial leaders and managers. Step by step, the authors lay out the challenges and best practices for Millennial managers already in leadership positions or preparing for the next step. The authors use their own surveys and research as sources for their prescriptions.

Because of their youth, Millennial managers immediately face unique challenges…

 

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One Businessman’s Secret to Success

Although known mostly for his conservative political activism, Charles Koch is also the CEO and chairman of a privately owned company that he has grown from a $21 million valuation in 1961 to $100 billion today. In his new book, Good Profit, Koch introduces a management framework called Market-Based Management, or MBM, which consists of five elements:

Vision. Create products and services that profit the consumer and society as a whole. The title of his book, Koch writes, comes from this viewpoint; good profit is good for all.

Virtue and Talents. Hire people that adhere to the values of the company first and foremost, before focusing on specific skills or knowledge.

Knowledge Processes. These are processes that enable the sharing of knowledge. Organizational structures that encourage collaboration, both internally and with external partners, are vital. Measurement processes, such as benchmarking, are also key. Finally, knowledge-sharing also depends on open two-way communication between employees and supervisors — specifically in allowing employees to “challenge their bosses respectfully if they think they have a better answer.”

Decision Rights. This is the business equivalent of the economic concept of “property rights” — in other words, ownership. The importance of ownership is another familiar but important component of good management. The more employees feel an ownership stake in what they are doing, the more care and conscientiousness they will apply to the task.

Incentives. Motivate employees to “maximize their contribution.” Koch uses Maslow’s hierarchy of needs, specifically the culminating need of “self-actualization,” as inspiration. Employees must feel that when the company benefits, they benefit. For Koch, there is no self-actualization motivation in automatic raises, including COLA raises.

The unfettered free-market politics of Koch, which is detailed in the first part of the book….

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Creating an Environment That Energizes Everyone

The Optimistic Workplace

When it comes to work these days, we’re expected to do more with less –– but is this nose-to-the-grindstone philosophy the best way to run a business? Alarmingly low employee engagement numbers indicate otherwise.

So, if pushing everyone harder isn’t the path to productivity, what is? Supported by the latest research, The Optimistic Workplace argues that our best work is the product of a positive environment. That’s good news for you as a manager. While you can’t personally transform the corporate culture, you can influence the workplace climate and create meaningful and lasting change.

Advocating a steward model of management, The Optimistic Workplace demonstrates how a people-centric focus ignites employee potential, increases innovation and catapults the organization to new levels of performance. Author Shawn Murphy reveals how to explore personal and organizational purpose and align them for astonishing results, build camaraderie and deepen loyalty, increase intrinsic motivation and more. Far from being a wish-upon-a-star discussion of workplace happiness, The Optimistic Workplace presents an array of surprisingly simple strategies to focus your actions and make employee optimism not just a worthy goal but a real and measurable result.

 

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The 7 Habits of Highly Effective People

 As we begin the new year, we introduce our All Time Best Seller series and look back at some of the classics… 

The world has changed dramatically since The 7 Habits of Highly Effective People was first published in 1989.

Life is more complex, more stressful, more demanding. We have transitioned from the Industrial Age to the Information/Knowledge Worker Age –– with profound consequences. We face challenges and problems in our personal lives, our families and our organizations unimagined even one or two decades ago. These sweeping changes in society and rumbling shifts in the digitized global marketplace give rise to a very important question: “Are the 7 Habits still relevant today?” And, for that matter, “Will they be relevant 10, 20, 50, 100 years from now?” Stephen R. Covey’s answer: The greater the change and more difficult our challenges, the more relevant the habits become. How you apply a principle will vary greatly and will be determined by your unique strengths, talents and creativity, but ultimately, success in any endeavor is always derived from acting in harmony with the principles to which the success is tied.

Through insight and practical exercises, Covey presents a step-by-step pathway for living with fairness, integrity, service and human dignity — principles that give you the security to adapt to change, and the wisdom and power to take advantage of the opportunities that change creates.

 

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Balancing Competition and Cooperation

For some people, the key to success is competition — always looking after their self-interest and fighting to be better than others. Others believe that success comes to those who are best at cooperation — who know how to collaborate with others. Columbia Business School professor Adam Galinsky and Wharton professor Maurice Schweitzer argue that this dichotomy is false.

In their new book, Friend & Foe: When to Cooperate, When to Compete and How to Succeed at Both, Galinsky and Schweitzer build on research from across the social sciences as well as advances in neuroscience to explain how the most successful people and successful relationships are those in which we find the right balance of both competition and cooperation.

We are always toggling between the two, although it is not easy. According to the authors, three fundamental forces — resources are scarce, humans are social beings and the social world is unstable and dynamic — give rise to an ongoing tension between competition and cooperation. These three fundamental forces are the underlying threads that run throughout the book.

Why We Compare Ourselves to Others

A chapter that explores the role that social comparisons play in our lives illustrates how these forces impact cooperation and competition. We are social beings, the authors write, and one way we figure our place in our dynamic world is by comparing ourselves with others. Such social comparisons can be motivating. When the Soviets became the first country to fly a man in orbit, the United States felt it must do better; the result was the successful first mission to the moon. Social comparisons, however, can also be destructive, as the attack of Olympic skater Tonya Harding on rival Nancy Kerrigan demonstrates.

Social comparisons help put our achievements in context, notably when scarce resources are involved. The authors cite one academic study that showed that people who graduate during a recession are happier with their first jobs than people who get their first jobs during an economic expansion. The reason? During an economic downturn, graduates who get a job compare themselves to most other graduates, who aren’t able to get a job at all.

The authors offer three principles that help harness the power of social comparisons and make them work for us rather than bring us down. The first is to recognize the natural order of things in which most of us instinctively believe. One example of this natural order is that older siblings should be successful first. The Williams sisters (and in another domain, John Kennedy and Robert Kennedy) worked well together, as the older sibling was the first to reach the heights of their profession. The second principle is to recognize or create new opportunities to compete. Turn disappointment into motivation to do better next time. The third principle is to allow others to have some schadenfreude — some joy in someone’s misery. After your incredible vacation to Fiji, the authors suggest, don’t forget to focus on the negatives as well (the rainy days, the lost luggage).

The core lesson of social comparisons, write the authors, is to seek favorable comparisons to make yourself happy, unfavorable comparisons to push yourself harder.

The chapter on social comparisons is the opening salvo of a fascinating exploration into how humans both collaborate and compete and how it’s possible to find that perfect balance between the two. The authors cover a surprisingly wide range of issues, such as the role of “psychological safety” (the permission to speak up), that enable hierarchies to be productive rather than destructive; how to use both competence and warmth to build trust; and how women can compete without facing the unfair gender-stereotypical backlash of being too “hard” or “tough” — to name just three examples. Filled with unforgettable stories, this is the ultimate guide for learning when to cooperate as a friend and when to compete as a foe.

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The Art and Science of Prediction

Between 1984 and 2004, Wharton professor Philip Tetlock conducted one of the most in-depth experiments in forecasting in history. Thousands of forecasts were collected and then analyzed over time for accuracy. The results of the experiment, called the Good Judgment Project (GJP), were published in a book called Expert Political Judgment in 2005. The conclusions of the book would be popularized in a simple, colorful phrase: The accuracy of expert predictions is about equal to predictions based on a chimpanzee throwing darts at a dartboard.

At first, Tetlock owned the metaphor that, he admits, he had used himself. But over time, the joke grew tired because it oversimplified the results. His experiment was being used as proof that expert predictions were useless — which is not, Tetlock argues, what the results showed. He eloquently describes in his new book, Superforecasting: The Art and Science of Prediction, that predictions can be made more accurate if experts adopt certain mindsets and behaviors.

Superforecasting, co-authored with journalist Dan Gardner, is based on empirical evidence drawn from what Tetlock calls phase 2 of the GJP. This phase was actually part of a larger experiment sponsored by the Intelligence Advanced Research Projects Activity, or IARPA, a government agency tasked with sponsoring research that improves the effectiveness of American intelligence.

IARPA launched a multi-year forecasting competition among five research teams, including Tetlock’s team. Each of the project teams could conduct their research in any way they wanted. The only requirement was to make predictions to a certain set of questions every day. Tetlock set about winning the tournament by recruiting ordinary people who made a hobby of forecasting. Eventually, he would attract, in total, 20,000 intellectually curious amateur forecasters to his team — people such as Bill Flack, a retired Department of Agriculture manager, or Devyn Duffy, unemployed from a closed-down factory (he is currently employed with the state).

The tournament was scheduled to last from 2011 to 2015, but after two years, Tetlock’s forecasters and “superforecasters” — a sub-category of the volunteers with significantly better-than-average results — were dominating to such an extent that IARPA dropped the other tems, including research teams from the University of Michigan and MIT.

 

From Active Open-Mindedness to Teams

How was Tetlock’s team of forecasters able to dominate the tournament? The answers to this question are detailed in a fascinating book that is filled with historic examples and often-surprising insights into the mistakes and assumptions that undermine even the best of minds.

One important and seemingly obvious (and yet so elusive) element required for accurate predictions is active open-mindedness — in other words, not building the answers based on one’s assumptions and biases. “For superforecasters,” Tetlock and Gardner explain, “beliefs are hypotheses to be tested, not treasures to be guarded.”

Another element required for superior predictions is a tendency toward probability. Many of us ignore probability more than we might realize. When the weatherman says that there is an 80 percent chance of rain the next day and the next day is sunny, the weatherman was wrong — or so we think. In truth, there was a 20 percent probability of a sunny day. The next day fell into that probability. Superforecasters think in terms of percentages, not yes, no or maybe.

Two other lessons drawn from the experiment are that superforecasters constantly update their information and adjust their predictions (and their beliefs) accordingly and that they work better in teams. The chapter on teams includes a fascinating account of the team around President John Kennedy whose advice prompted him to order the disastrous Bay of Pigs invasion, but who were also instrumental in guiding Kennedy during the Cuban Missile Crisis.

Leaders across the spectrum — from world leaders in the capitals of nations to business leaders at all levels of their organizations — are making decisions every day based on what they believe is going to happen. Given the dramatic consequences that can result from the wrong predictions, Superforecasting is perhaps one of the few books this year that should be required reading for all of us — and especially for our leaders.

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A Radical Approach to the Design of the Sales Function

In The Machine, Justin Roff-Marsh shows readers how to follow the intrepid executives who have implemented his ideas over the last 15 years, building ridiculously efficient sales functions –– and market-dominating enterprises –– as a consequence.Roff-Marsh calls these executives his silent revolutionaries.

For the last 20 years, organizations’ ability to produce has overtaken their ability to sell, and, for at least as long, customers have unfailingly embraced every opportunity to avoid interacting with traditional field salespeople.

Applying the division of labor to sales might not seem controversial, but this innocent-sounding idea decimates the sales management orthodoxy and replaces it with a strange new world where sales is primarily an inside activity, where salespeople earn fixed salaries and focus their attention exclusively on selling conversations, where regional sales offices become redundant, and where marketing and engineering become seamlessly integrated with sales.

The Machine is a field guide for the executive who’s prepared to wrestle sales away from autonomous field-based artisans in favor of a tightly synchronized team of specialists. Readers will embrace The Machine either to exploit the new sales order or to avoid falling victim to it.

In this summary, you will learn:

• Why a centrally coordinated team should be responsible for sales.
• The four key principles for applying the division of labor to sales.
• A model for creating the new sales environment in your organization.
• To generate sales opportunities and manage the sales function.

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Getting the Right People in the Right Seats

In his mega-seller Good to Great, Jim Collins famously talked about getting the right people in the right seats on the bus. In Misplaced Talent, human-resources consultant Joe Ungemah offers HR practitioners a thorough overview of the tools, techniques and frameworks required to achieve this important goal.

According to Ungemah, most of these tools and techniques have not changed dramatically. “What has changed,” he writes, “is the desire and ability for organizations to question the return on investment that their people practices have on improved business efficiency, staff engagement and performance.” In other words, through the new capability to accumulate vast amounts of data, organizational leaders can determine quite accurately whether the right people are in the right seats.

This puts the pressure on the HR staff and HR consultants, who are not only tasked with hiring employees who bring in the required skills, capabilities and temperament for the jobs but also with developing employees to achieve their greatest potential. The ultimate goal, writes Ungemah, is a strong employment relationship, and requires leaders to make the right HR decisions related to recruitment, responsibility assignments, staff recognition and discipline, if required, among other considerations.

The Person-Environment Fit

The first step in achieving the optimal employer relationship is to set the right criteria for the talent the organization wants to attract.

Once that criterion is set, the organization must then develop the right strategies and tactics to attract the right talent. For Ungemah, that means developing a clearcut employer-value proposition (EVP), which is then conveyed to potential candidates through an effective employer brand. Based on quantitative and qualitative data drawn in large part from interviews with current employees, the EVP details the employer promise related to a positive employment experience. The employment brand must reflect those promises through a credible, aspirational and consistent message.

As important as job criteria and employer brand are to the process, the rubber really hits the road when the new employees are hired. Specifically, Ungemah writes, human resources must immediately work to develop an employment relationship that reflects a high person-environment fit. The person-environment fit is, in essence, the technical term for “right people in the right seats.”

A high person-environment fit is achieved if, according to Ungemah, the organization has effectively applied the knowledge, skills and ability of the employees to accomplish the job tasks; the organization fulfills the tangible and intangible needs of its employees; and employees feel that the work they do is coordinated and is contributing to a common purpose.

Ungemah explores the tools and techniques required to achieve each of these three tenets of high person-environment fit. For example, organizations will use a variety of ability tests, interviews and job simulations to assess the capabilities of their employees, and thus be able to apply their knowledge, skills and ability effectively.

Fulfilling the needs of employees is accomplished through psychometric tests that help identify the personality characteristics, motivators and values of the organization’s employees. Ungemah warns, however, that organizations must not misuse the results from psychometrics. The last element of the person-environment fit reflects the feeling that the employees and the organization are moving in the same direction. To achieve this feeling, Ungemah writes, organizations and their employees must engage in a psychological contract, which is carefully built through the time, effort and resources that the organization invests in developing the employee.

Ungemah is the opposite of Jim Collins, who has sold millions of books by building metaphors and simple yet poignant concepts that, he argues, lead to broad business success. Misplaced Talent, in contrast, is a review of human-resources tools and techniques that, for the most part, are not new or revolutionary. However, Ungemah, supported by real-world examples from the many expert practitioners he interviewed, has written a valuable manual that helps leaders transform the flash of a Collins metaphor into workplace reality.

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How Great Companies Ignite Passion in Their People Without Burning Them Out

What key question do managers and supervisors at Marriott Hotels ask their employees each day, enabling them to maintain a turnover rate that is one-third of the industry standard? Why are there more than 500 “co-presidents” at a software firm that has twice been recognized as the best place to work in Minneapolis? Why does a burgeoning healthcare consultancy firm in Philadelphia ban its people from sending business-related emails after 6 p.m. and on weekends?

The answer to these intriguing questions –– along with many others –– can be found in Eric Chester’s On Fire at Work. Chester reveals the seven cultural pillars that today’s leading employers focus on to attract and retain top talent: compensation, alignment, atmosphere, growth, acknowledgment, communication and autonomy. On Fire at Work is a practical field guide that leaders in any organization can implement to build more than an engaged workforce, but rather a workforce that’s on fire!

In this summary, you will learn:

• The seven cultural pillars used to attract and retain top talent.
• What sparks on-fire commitment to a job.
• Five ways to ensure core value alignment.
• The Four Ps of Recognition and Reward.

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