People Risk - How to get started on managing it

As regular readers of this blog you will know that a subject dear to my heart is the topic of People Risk.   To me it is the biggest iceberg in the corporate sea and very few people have any understanding of how to track and manage it let alone fully appreciate the damage it can cause.  Thankfully I have been working with Sandra Quinn on a new Point of View that really gets to grips with the issue.   It has just been published and you can view it and download it from the following link http://ebooks.capgemini-consulting.com/Your_People_POV_04mar_2013.pdf.

However, to give you a flavour of the PoV Sandra has penned this guest blog.  I hope you enjoy it and can sense the passion we have for this subject.

Every other news story these days seems to focus on some aspect of toxic cultures, systemic people failures, market rigging, or plain dodgy conduct. In part why are we surprised? It's axiomatic that people are at the root of everything we see, good and bad. 

Yet as the common denominator in all this, we struggle to deal with the risks and the opportunities that people present, both those they present and those which the organisation creates in them, especially in the way it performance manages, rewards and incentivises them.

Presented with an investment transaction you would analyse your risks and returns from every angle to make sure you were making a wise decision. 

People are among your most significant corporate investments. Not just in costs of package but in potential to influence and take key business decisions, committing the organisation to strategic and financial positions. Yet in most cases no comparable level of rigour is applied between that relating to a transaction and that relating to the choice,  recruitment and management of the people who will deliver and approve that transaction, let alone the way they conduct themselves and run the business.

When it goes wrong, the effects can be severe: banking culture, LIBOR, BP, the SFO, NHS and patient treatment, the relationship between press and police, drugs in sport. Indeed type 'toxic culture' into your search engine at the moment and you can read about the problems of the Australian swimming team.

The problem is that people - volatile, difficult things we all are - are tough to deal with and often present recurring and what can seem like insoluble problems, especially for managers and senior executives who are more technician than leadership, and HR functions focussing on process rather than outcomes. And in worlds driven by targets, risk indicators and metrics, those complex and persisting risks which span the organisation (such as People risk) are particularly difficult to find ownership for.  

But it's not insoluble. Start by bringing together your Risk, HR, Stakeholder or Investor Relations people - have them carry out the appropriate strategic planning and apply many of the principles you'd apply to regular operational risk. This is the first step to grappling with the issue. To support you Quinnity and Capgemini have been doing some cutting edge work together on both minimising the pain of people risk management and maximising the results. If you are interested you can read more at http://ebooks.capgemini-consulting.com/Your_People_POV_04mar_2013.pdf or contact us at Capgemini on 0870 238 8514

Why the idea of “The Innovator” is killing Innovation

Imagine a David Attenborough voiceover whilst you read the italics:

“Here, in the deepest of corporate jungles we catch a glimpse of the elusive Innovator – this rarest of species is not well adapted to surviving in an increasingly harsh corporate environment and as such, is on the verge of extinction.  To see one that is able to function at all in the concrete jungle is rare, to see one functioning well is an experience only few experience.  And yet, such is the allure of the Innovator and the beautiful Innovations they create that many a senior executive will not rest until they have successfully trapped a “department” of Innovators. 

Being able to “bag” an Innovator is, of course, a major trophy for a corporate big-shot and is highly prized.  However, once captive, many of these Innovators simply do not have the ability to adapt to the rigours of the corporate environment.

Many struggle to fashion the tools required to develop effective business cases, many fail to navigate the complicated stakeholder landscape, some do not have the social skills required to work with the other jungle beasts and most lack the plumage and voice to show off their ideas to senior executives.  Most spend their days coming up with new ideas that are simply left unacknowledged and undeveloped.  Unloved and unable to bring their ideas to fruition they return to their own caves to live out a solitary existence.”

OK – enough with the Attenborough voiceover – here’s the point.  Whilst we continue to believe that the secret to driving Innovation in a business is to hire Innovators we will continually fail.   From spending many years studying Innovation and Innovators I can now categorically state that effective Innovation is best driven by a multi-disciplinary team of people with following a process.   Whilst we continue to try to find a person or persons capable of successfully executing all the stages of the Innovation process we are missing out on the massive benefits Innovation can bring.  INNOVATION IS BEST DELIVERED BY A TEAM.

Here’s another metaphor.  In the UK there is a wonderful TV programme called Grand Designs (hosted by Kevin McCloud).  Each week Kevin introduces the viewers to a couple who are planning to build their dream house and we follow their progress as they wrestle with numerous architects, planners and builders.  We smile smugly as we watch their inevitable overspending and failure to complete the build on time.   We wince as they struggle to juggle families, jobs and the building project over many years – eventually to stand proudly in the front room of their new house reliving the traumas with Kevin.  At the end of the programme we feel a sense of admiration that “against all odds” the couple have triumphed and over the many years and months have brought their idea from the dream to the paper to the reality.  This is the Innovator as we so often picture them.   Compare and contrast with another (less glamorous) UK TV building programme called the Big Build (hosted by Nick Knowles).  Each week Nick introduces us to a family who are down on their luck and living in disastrously unsuitable accommodation.  In the space of two weeks, whilst the family are holed up in a local B&B, Nick and an army of designers, builders, plumbers, electricians, plasterers and decorators dismantle, rebuild and extend the family’s home.   The result is magical and despite a few minor melodramas, the TEAM has pulled off a minor miracle for which the family is inordinately grateful.   This is Innovation as it can be, as it should be – no fuss, no bother just the right people with the right skills following the right process delivering a phenomenal result.

So please, for those of you who want to drive Innovation – please stop looking to identify “the” Innovators in your business, it is counter-productive and distracts from the more effective way to deliver innovation – instead look to build the process and the team required to deliver Innovation. 

Having laid out my thoughts on this topic I’d be fascinated to know what people think – do drop me a line and let me know your thoughts.

The customer service revolution and the madness of "owning" the customer

The mindset that believes that “owning the customer” is a prerequisite of running a successful business is stuck in a time-warp.  There; I’ve said it.   Personally I think that the concept of owning the customer is an idiotic, dysfunctional, deeply anachronistic and patronising idea that is as misplaced and unwelcome in the 21^st century as slavery.  But wait – many of our leading businesses are still acting as if they believe that “owning the customer” is an “a priori” truth that must be adhered to.  This blog sets out to debunk the myth.

Over the last few decades most businesses have come to terms with the fact that they don’t necessarily need to “own” their own equipment and property (leasing/renting) or own their own workforce (outsourcing) and are now coming to terms with the fact that they don’t necessarily need to own their own IT (Cloudsourcing) but they are still struggling to come to terms with the concept of not owning the customer. 

For those of you who haven’t got your heads around this concept yet here’s where a “we need to own the customer” mindset comes from and here’s what it does.

Its roots are in corporate insecurity and fear and strongly linked to the desire for control.

Firstly if you don’t have full faith in your brand(s), product(s) or service(s) you will constantly be looking for ways to “capture” customers with gimmicks and offers that keep them loyal.  You will spend large amounts of money trying to create a loyalty that your services don’t naturally generate.   You will be very conscious of the price of customer acquisition and customer churn and will have big programmes in place to manage customer complaints.

Secondly you will be happy (and by happy I mean impelled) to sell to “your” customers products and services (e.g. PPI, Horsemeat etc) that are profitable in the short term but do not have your customers best interests at heart – this is of course justifiable as it is your right to make money out of your customers since you worked so hard to ensnare and own them in the first place. 

Thirdly you will be paranoid about your customers experiencing a “better experience” elsewhere so you will spend vast amounts of money to build and “own” an end-to-end experience that means that none but the most inquisitive and/or frustrated of your customers will bother to go elsewhere.

These actions will all provide you with an apathetic but relatively stable base of “punters, wallets, schmucks or muppets” that you can efficiently control and extract money from over a period of time and enjoy the fruits of your labours despite your inability to create a brand and product set that stands up for itself and serves the real needs of its customers.

Unfortunately, in the words of a paraphrased reprise from Scooby Doo, for a worryingly large number of UK Plc’s senior executives “It would all have been OK if it wasn’t for those pesky kids and that new fangled internet”.  Welcome to the 21^st century.  We the customers do not want to be owned and will, over the next few years, find new digital means to circumvent businesses increasingly expensive and desperate attempts to control and own us.

Yes, global connectivity, openness, social sharing and a bit of a financial crisis are turning the old world order upside down – whether it be politics (see Arab Spring & MPs expenses) or business (see Financial Services scandals, Press Scandals, Horsemeat etc) or even public services (see NHS death rates, police scandals etc).  We the customers can and will communicate, share and demand real change and higher behavioural standards.

So what should I do as a business leader when confronted by this new reality?

Unsurprisingly I’m going to recommend the following five heresies.

1.      Redirect spend away from schemes that “con” your unsuspecting database of contacts and customers into buying products and services they neither want nor will benefit from and instead spend money on creating a brand, product and service set that you can be truly proud of.

2.      Seek out new ways of “freeing your customers” from your own clutches.  Actively seek to showcase your services through shared delivery channels where you appear alongside your competitors and other service providers.  This will freak out your CMO but delight your liberated customers.

3.      Discourage the use of any internal language that seeks to diminish the personhood of your customers (e.g share of wallet, muppets (see Goldman Sachs)).  They really are people and want to be treated as such.

4.      Stop talking about how you are going to become more customer focused – nobody believes you anyway and they certainly don’t believe that a treatise on heightened customer focus has anything to do with altruism and real customer benefit but has quite a lot to do with your business making more money.

5.      Embrace corporate openness and the tools of the digital revolution and work to build corporations that honestly and openly provide their products and services to customers in a way that enables the customers to feel they are making a good and real choice.

And in the afternoon we could give world peace a go.  I can’t help myself – I’m still an idealist who believes that there are better ways of doing business that benefit all of us, our planet and the future generations.   After all we did decide slavery was a bad idea once upon a time.  So take what you will out of this.  There is a revolution in customer service coming and it will be fought on the battleground of who owns the customer.  My money’s on the customer winning.

Prophets & Prophet Warnings – What HMV, Comet and the other troubled brands all missed

You would have to have been locked in a skiing lodge or hidden away on a very exotic Caribbean island for the last few months not to be aware of the slew of high street mainstays (Comet, HMV, Jessops, Blockbuster etc) that have fallen into administration either side of Xmas.

At the risk of stating the obvious and sounding very trite, these businesses – despite their very recognisable brands – have not adapted quickly enough, or thoroughly enough to the changing economic and technological climate.   Sadly 1,000s of very real people have consequently been made redundant and many members of the public and small suppliers will be out of pocket and feel aggrieved.   That said, this is not a new or unique situation.  Enough “big brand names” go to the wall on a fairly regular basis for us all to be aware of the fact that brands – even big ones – go under when they fail to adapt. 

The good news is that I am not going to spend the rest of this blog nostalgically bemoaning the loss of the recognisable UK high street brands associated with warm fuzzy memories, nor am I going to forensically pick apart the economic whys and wherefores of the passing of these once strong businesses – both of these angles have been extensively covered already.  Instead what I want to do is a bit of thinking about how to avoid going into receivership and in particular make an appeal to all CXOs to take the time to find and listen to a corporate prophet.

The corporate prophet?  Yes the corporate prophet.  Corporate Prophet – an individual with genuine and vital insight(s) relating to the future health of the corporation – cf. Freeman 2013

Throughout historic literature the role of the prophet / shaman / guru / oracle etc has always been to deliver difficult and challenging messages to the leaders of a faulty society.  The wise leaders are the ones able to see beyond their own position, sense the wisdom in the prophet’s message and call their society to action.  Sadly all too often the historical prophets are ignored and in many cases are ridiculed and/or tortured and killed by leaders keen to maintain the status quo.  Inevitably by ignoring the prophet’s warnings the leader and the society usually suffer a suitably painful demise.  Now I’m not saying that the CXOs of HMV et al deliberately ignored or disregarded the prophets sent their way but a raft of personal experience, supplemented by a cruise through the biographies of famous corporate leaders, reveals how the CXOs of the recent corporate casualties could easily have missed out on some timely wisdom from a corporate prophet.  Here’s why:

1) Corporate prophets are not easy to come by in the Boardroom

2) They are painful/no fun to be around and

3) Corporate prophets don’t often come with a label and can be disguised in a range of shapes and forms. 

So if you are a CXO with a desire to be a wise corporate leader my advice, based on the points made above is simple a) Take time on a regular basis to be with and talk with people who are not your direct reports, b) Work on asking people open questions and be prepared to listen to their answers – you won’t hear anything useful if you act defensively and/or aggressively to what others say. C) Look out for your corporate prophets in some unusual places.  The corporate prophet may be the employee who’s asking the difficult questions, they may be the former customer who took the time to complain or they may even be from one of those “fluffy” futurist consultancies.

So hands up all those CXOs who are humble/mad enough to seek out people who are angry at them/disagree with them/won’t pander to their ego.  If you’ve still got your hand up and are still reading – well done – hopefully you will find the insights you deserve.   When you look at the challenges associated with tuning into a corporate prophet it’s perhaps not surprising that CXOs often miss the difficult messages.  Here’s hoping you don’t miss this one.

Bionics – What the six million dollar man can teach us about the art of digital transformation

The very words “Steve Austin...a man barely alive; we can rebuild him...we have the technology” is enough to send a warm wave of nostalgia surging through me.  For those of you who, like me, were young/old enough to spend your early Saturday evenings during the late 1970s glued to the exploits of the six-million-dollar man you’ll already be hearing the theme tune and replaying in your mind that faux mechanical sound that was generated when Steve used his bionics – a sound that Michael Bay seemed to appropriate ad nauseam for the Transformer movies (but I digress).

For those of you who need reminding – Steve was an astronaut who was badly injured on his return to earth from space.  His right arm, both legs and left eye are replaced by "bionic” technology implants that enhance his strength, speed and vision far above human norms: he can run at speeds of 60 mph (97 km/h), his eye has a 20:1 zoom lens and infrared capabilities while his limbs all have the equivalent power of a bulldozer. He’s also very cool.

For me, the six-million-dollar man (over $30M in today’s money), is a great metaphor that exemplifies what effective digital transformation is actually all about.   It’s a great example of using the latest technologies to upgrade your current capabilities in a way that appears seemless, sexy and magical.   The latest Capgemini/MIT research shows that those who are digitally “bionic” (the Digirati) are 26% more profitable than their non-bionic peers.

What is fascinating is that the Capgemini/MIT research goes on to outline the key elements that the Digirati have in place – effectively describing the Digirati’s digital central nervous system (CNS).  The first element is the ability to use digital capabilities (social, mobile, web) to develop a much deeper and richer awareness of whom your customers are, what they value and why they would buy from you.  The second is the ability to process and interpret this welter of data and turn it into meaningful and actionable insights (data, analytics).  The third is the ability to respond (service, fulfillment, or sales) in real time (or very close) to the customers’ needs with the requisite empathy.  All whilst maintaining an ostensibly human face (just like Steve Austin).

Ostensibly the Digirati have finely tuned “digital senses” deeply attuned to customer needs, sizeable and smart “digital brains” capable of analysing and making sense of large amounts of data and strong and aligned “digital spines” enabling rapid “reflex-like” responses.  All three  elements of the digital CNS are essential for firms looking to generate competitive edge but the good news is that building any of them up independently will also drive benefits.  

So the message from the research for business leaders in relation to digital transformation seems to be as follows – Which digital capabilities you choose to develop first seems to be less important than the fact that you have started developing some capabilities.  Whether its digital senses, a digital brain or a digital spine matters not – you will need all three but having one or two of the capabilities is better than having none.

Santa Claus and customer Experience – Lessons from Miracle on 34th Street

Let me confess this now.  I cry when watching films – probably a lot more than is “normal” for a bloke, but there’s just something about a big screen, human story (or in some cases cartoon or puppet story) that gets inside me and brings tears to my eyes.    I know, I know, “man up” I hear you cry but I fear it’s a losing battle and I will forever get a little misty eyed when gazing at the silver screen or the telly.  On the plus side I can get really excited about films – they inspire me to think.

Last weekend I sat down with the family to watch the first of the Xmas films – Miracle on 34^th Street (featuring the fabulous Dickie Attenborough) and yes, I did have a moist eye at the end as the State of New York declared its belief in Santa Claus but that’s not the point.

The point is, as I watched the film I was inspired again by Santa Claus/Kris Kringle’s attitude to customer service.  For those of you who haven’t seen the film – there is a wonderful scene where a shopper “corners” a manager of Coles’ department store, seemingly to “complain” about the advice she has just been given by the stores Santa (Kris Kringle), who has advised her that the toy she wants to buy for her child is much cheaper at the store down the street.  Just as the manager is beginning to apologise the shopper announces that if that is the kind of service Coles is offering to their clients then she will be shopping there for all her household items not just Xmas toys.  Stunned but delighted the manager realises that Coles (thanks to Santa) has stumbled upon a truly differentiated customer experience and runs off to pitch the idea to the Board.  Of course, as this is Hollywood the idea works brilliantly and Coles’ has people queuing out of the doors delighted by the stores new service mantra.

Now I know that the idea of being “reassuringly honest” has and is being tried in a number of businesses (e.g AVIVA – “Quote me Happy”) to drive loyalty and better quality business.  As such, whilst deeply refreshing and good for the soul, it is not a new or novel approach even if it is a rarity.  However, what really struck me is that what Santa “gets” so clearly is that his organisation doesn’t “own” the customer.   His empathy with the customer is profound and he has a willingness to serve the customer that is above all else.  He is a true “partner” - he has set the customer free to make the right decision.  

We all know that as customers this is how we’d like to be treated by those institutions who aspire to be our “partners”.  Many supermarkets, banks, insurers, telcos, petrol companies, retailers and utilities companies want to be more than a company delivering a transaction.  Most really want us to have a loyalty inducing customer experience when we interact with them but too often they struggle to deliver it leaving us with the feeling that somehow we just became a captive, a “share of wallet”, a plus in someone’s sales figures or a sucker.  Why? – Surely by now we have understood the societal and economic impacts of being honest and the disastrous effects of miss-selling, miss -appropriating and miss-managing the customer.  What is the solution?

To deliver a compelling “partner like” experience to its customers an organisation needs to take a number of lessons out of Santa Claus’s manual.   So here are four things that Santa gets right  that enables him to be a real partner. 

1)      He has real confidence in his brand and product – he is not trying to sell a substandard, immoral or environmentally damaging product.   Xmas is cool.  He does not have to have regulators haranguing him to “treat his customers fairly” – it’s what he wants to do.  His reputation is exceedingly important and he will not jeopardise it.

2)      He knows his customers really well – he knows what they like and he listens to them – his data sources and analytics capabilities are so good he even knows who’s been naughty and who’s been nice.  

3)      He knows what’s right for us – like a good parent he is able to analyse and make sense of the welter of mixed messages that his customers emit and find the product that is actually what the customer wants or needs – which may be different from the product that the customer originally thought they might want.

4)      When his customers makes their choices he delivers – he has a genius supply chain and is capable of deploying all kinds of ground breaking technology (flying reindeers etc) to ensure that each and every one of his customers feels special and cared for.

5)      He only employs people who are prepared to believe in the product – now whilst his recruitment requirements (ability to make toys by hand, ability to live in cold climate, ability to wear garish hats and pointy cloth shoes) may seem odd to some but we all know that in order for his business to work the people who work in it have to believe in what they are doing and particularly who they work for.

So in a digital world my advice to businesses is as follows:

1)      Build great products – designed with, for and by your customers

2)      Deploy “digital senses” (social, local and mobile capabilities) that allow you to really get to know your customers well

3)      Build really smart data and analytics capabilities that are deeply customer sensitive and allow you to personalise your products

4)      Redesign your operational processes using digital capabilities fulfil your customers need as if it was magic

5)      Employ people who live in the digital world, believe in what you are doing and have the right capabilities

Happy Xmas and thank you Santa Claus

When work becomes play: Using Game Mechanics to Drive Digital Transformation

Here's a fabulous blog on Gamification by the effervescent Maggie Buggie our Head of Digital Transformation at Capgemini Consulting.  This is her bag baby.  Hope you enjoy it.

Gamification is a term that has experienced major market hype and to a certain extent has suffered for it.  That said, when you get below the hype there really is a tangible business potential to be harnessed by the application of intelligent, focused gamification interventions.

Gamification is the use of gaming mechanics in a non-gaming environment. The concept uses game thinking to solve problems and engage audiences.  It is regularly oversimplified to a lowest common denominator of “playing games at work” but to do so is to miss the point.  Within an organisation gamification utilises intrinsic human behaviours such as the need for recognition to drive and embed performance change and to augment the enterprise’s innovative capacity.

Against a background of changing consumer behaviours, the perennial challenge of driving ROI with historical technology and the burgeoning employee expectations of their workplace experience, the appetite of executives for innovative mechanisms they can deploy to create a step change in business performance is growing.  It is estimated that over 70% of all transformations fail.  Couple this with research estimates that over 71% of employees are not engaged or are actively disengaged from their work and the prognosis for most business transformations is not good.  Market analysts have indicated gamification based services as one of the next frontiers in the Digital evolution for business.  According to Gartner, “by 2015, 40% of Global organisations will use gamification as the primary mechanism to transform business operations” and Forrester has forecast that the gamification market is expected to be worth $2.5bn by 2015.

Cultural change is a key element of the Digital Transformation agenda. Increasingly our clients, across all sectors, are acknowledging the need to address and drive behavioural change as part of the cultural shift to a digitally enabled, change ready organisation.  People and transformation management intensity are key to unlocking the digital advantage as evidenced by our recent empirical research on Digital Transformation with MIT. http://www.capgemini-consulting.com/the-digital-advantage/

and have successfully unlocked increased business performance through digitally enabled transformation

“How” you approach and deliver digital transformation is as important as “What” you do.  What distinguishes the “digirati” from the rest of the pack is that they exhibit digital maturity.  

2013 will see a wider gap emerging between those who are successfully driving their business through digital and those who are not, and are therefore getting left behind.  Addressing behavioural change through enterprise gamification is a key part of both building enterprise innovation capacity and unlocking the digital advantage.  It’s the beginning of a new game in the Digital revolution.