Recession Pants

Part of our Customer Service Hero, Zero, or Nero series.
Zeroes seemed to have just stopped trying.

I like Dockers pants.  They are easy to find, and their sizes are reliable and fit me well.  I'm a particular fan of their "Golf Pant" – not because I play golf, but because they have a few bonuses I like: a 'shirt-gripper' waistband (to keep shirts tucked in) and extra interior pockets (to keep my stuff easy-to-find).  Also, I don't have to iron them — a big time-saver.

So I visited a store earlier this week to look for them.  But the Dockers section had a lot of new, unfamiliar names for their pants: 'The Broker Chino' and 'The Lincoln Pant'.  The Golf Pant was nowhere to be found…

I was in a hurry, so I grabbed the ones which looked closest to the style I liked: The Lincoln Pant.  Same price, same style.  Just a different name…

Or so I thought.

The next morning, I put these pants on, and noticed to my annoyance that the shirt-gripper was missing.  My brain was filled with images of me constantly stuffing my shirts back into the back of my pants.

Then I went to load my stuff: change, cell phone, pens, glasses case, cash, and such.  No interior pockets, so all my stuff was swimming in there together.  Plus, the pockets aren't as deep as they used to be.  Another annoyance, especially when I'm driving or sitting and stuff spills out of my pockets.

It seems that the Lincoln pants are a recession version of the Golf pants: All style, no substance.  By skimping on a few square inches of cloth and that little rubbery strip around the waist, the pants have lost most of what made them worth buying in the first place. 

Lessons for Business
Times are tough for a lot of businesses, and the desire for cost-cutting is understandable.

But when a business chooses to scrimp on the very things their customers value, they make things even tougher for themselves.  Ultimately, such businesses wither as customers see no particular reason to patronize them.

Did Dockers offend me?  No.  I bought a decent (but not special) pair of pants.  But by charging the same price for a blander product, they did create a Zero experience and gave me the impression that they just stopped trying to meet my needs.

So, by saving costs on these "recession pants", Dockers will likely lose a customer.  That's a steep price for the few pennies saved.

What if, instead, Dockers had leaned into the recession winds, and invested a few extra cents?  Maybe heavier cloth, more pockets, or some cool innovation.  What if they had chosen to stand out from all of the competitors who also cut costs?  What if they treated the recession as an opportunity to grow, rather than a threat requiring fiscal tightening?  What if they had chosen to change things instead of being changed by them?

It might have cost them a little more in these hard times, but it would have increased my devotion to their brand, perhaps for several years.

What is that worth?

[where: 1988 Pavilion Way, Lexington, KY 40509]

Service Nero: Ruby Tuesday

Part of our Customer Service Hero, Zero, or Nero series.
Neroes fiddle while the organization is on fire.

The meal was fine.

But I left my glasses at the table.

When we sat down, I distinctly remembered setting them near the edge of the table.  As the meal progressed, and we attended to our 2-year-old, they got obscured by plates and napkins. 

As we were leaving the table, we saw some long-time friends at another table.  My wife took our son over to visit while I paid the bill (nice tip – more than 25% because we had a coupon) and gathered our things.  But I forgot my glasses. 

We visited with our friends for about 5 minutes on the other side of the restaurant and went out to the car.  That's when I realized that I didn't have them. 

I returned to the table, which had already been cleared.

That's when it got ugly.

I found our server, and when I asked her about the glasses, she declared that they weren't on the table: "I would have seen them if they were there."  She was quite defiant, and I started to regret that I had been generous with her tip. 

She then asked if I had left them in the bathroom – which I hadn't visited.  I had to verbally nudge her to get her to ask around in the kitchen to see if anyone else had seen them.  She came back: "They're not here."  She was getting impatient with me.  I was getting impatient with her.  I regretted tipping her at all.

I told her I was certain I left them on the table, and I wondered whether they could have been placed into the trash.  Now, she looked at me with disgust.  She reiterated that she would have seen the glasses "if they were there."  When she saw I was serious and wasn't going to leave, she offered to talk to the manager about whether I could go through the trash. 

While she was in the kitchen, I heard her declare that she wasn't going "in there" (the trash can).  There were also rounds of laughter — I assumed it was at my expense.  She came back, and informed me they would carry the can out to the back of the restaurant, and I could rifle through it out in the cold.  She looked at me as though I had bugs crawling all over me.  Now furious, I told her I'd go out there.

I pulled my car around back, and two kitchen dudes brought a couple of garbage cans out.  Without saying a word to me, they plopped them down, returned to the kitchen, and slammed the door.  I stood there in the cold, stunned for a few seconds as I realized that no one was going to help in the slightest — even to offer any suggestions on where to start or implements with which to sift through the trash…

Then, I remembered that I had a 24" level in the back of my car.  At first, I poked and prodded through the kitchen waste with the bright yellow level.  No glasses.  Then I was rowing through the stuff to get deeper and deeper into the can.  My son was repeating "What is Daddy doooooing?" over and over again.  It must have made for a comical scene, but I was livid.

I was angry enough that I entertained the thought of emptying the trash cans all over the lot.  Or, even better, the lobby!  I just wanted revenge.

Then, I rowed back a piece of lettuce and found my "prize": The glasses were covered in some sort of ranch sauce, onion, and ketchup concoction.  I went back to the car to get a few paper napkins, and then fished the disgusting mixture out.

I wanted to show our server — despite her absolute certainty that the glasses weren't there — that in fact, they were.  So I headed around to the lobby.  One of the kitchen dudes was outside the front door on his smoke break.  "Did you find 'em?"  "Yes," I said, holding up the messy prize.  "Really?  That's amazing…"  I asked him to let our server know, deciding not to make a bigger confrontation out of it.

While I had gone to the front, the manager had come out briefly to talk with my wife.  He went inside before I got back.

But for me, it was too little, too late.  I hated Ruby Tuesday.  That was two weeks ago, and I'm still peeved.  Can you tell?

A Few Lessons for Business

  1. It isn't just what you are selling.  Bad service ruins a great, quality product.
  2. Be vigilant.  One employee (and one incident) can reflect badly on the entire company.  It won't matter if you do great 90% of the time.
  3. Be humble.  Don't pretend to be certain, whether to cover for what you don't know or to cover for what you didn't do.
  4. Don't tell customers they are wrong.
  5. Don't treat customers with contempt, disgust, or derision.
  6. Own some part of the customer's problem.  Even if it involves something distasteful, offer to help the customer in some way.  They didn't have to sift through the trash with me, but I would have appreciated simple suggestions or tools or even sympathy…
  7. The real problem is bigger.  Very few customers blog or confront like I just did.  Most simply give up and never come back.  Find out why.  And fix it.
  8. Customers talk.  Customers will tell family, friends, and acquaintances (and, sometimes, blog readers) about their bad experiences.  But they probably won't tell you.
  9. Don't leave your glasses at Ruby Tuesday.  On second thought, better be safe and just don't go there.  Ever.

[where: 1808 Alysheba Way, Lexington, KY 40509]

Customer service: Hero, zero, or Nero?

Here at Lowell's, we strive for an exceptional level of customer service.  We want our customers to remember and recommend us.  When they do, we grow.

In reality, we make mistakes.  But we do try to learn and improve when we make them.  And we try to make up for mistakes whenever possible.

Recently, we have had some, er, memorable customer experiences with other organizations.  In upcoming posts, I'll document some of them.  It will be quite entertaining.

In the process, I'll use three categories to talk about customer service levels:

  • Heroes:  Heroes are the folks who surprise, delight, and really create memorable customer experiences.  They are the ones who care the most about their customers, and really deliver what customers want.  Heroes create vibrant, growing businesses.
  • Zeroes:  These are the people who, in some way, have seemed to just stop trying.  There's nothing particularly bad about their experiences, but there's nothing great, either.  They're just complacent.  And the end result is a blah, unremarkable encounter.  'Zero' businesses are usually stagnant or shrinking.  They tend to have shifted their focus from customers to internal processes, and often end up quite bureaucratic as a result. 
  • Neroes:  Named in honor of the emperor who 'fiddled' while Rome burned, a customer service Nero is someone who actively creates a crappy, customer-repelling experience.  'Nero' experiences often come from rogue employees, but some organizations seem to allow poor service to spread throughout.  Nero businesses often implode as customers simply evaporate.

We're going to have some fun with these posts, but we're also going to try to extract important business lessons from them. 

We're also very interested in hearing about your hero, zero, or Nero customer service experiences.  Comment below about your notable experiences.  We can't wait to hear from you.

[where: 111 Mechanic St, Lexington, KY 40507]

Taxes, Taxes, Taxes

I'm quite a bit different than my business-owning peers — I actually don't mind paying taxes. I get a lot of benefit from those taxes: providing for our common defense, local police and fire protection, and a pretty great infrastructure (by world standards), among many other services that our governments provide.  It is my duty as a citizen to financially support the governments that protect and enable our freedoms.

I feel this way even though those services and those governments should be much more efficient and much less bureaucratic than they are.  So I'm not a typical all-taxes-are-evil type of business owner…

But I hate dealing with taxes.Tax-burden

When I bought this business, I knew that I was going to have to deal more with taxes and payroll issues than when I was an individual employee of a corporation. (Unlike many businesses, we don't send our payroll or most of our taxes out to other professionals. Yet.)

But I totally underestimated the crushing administrative burden of the variety, frequency, and complexity of tax payments.  Besides dealing with federal, state, and local governments (which I expected), I quickly learned that each entity had many different types of taxes, each with different weekly, monthly, and quarterly schedules, and each out-of-sync with the others.  There were many taxes which we paid and documented on a regular basis which had to be re-documented periodically.  Then, in January, the schedule gets jumbled from every other tax period.  It is needlessly complicated and time-consuming. 

Again, I'm a willing taxpayer (although I'd always welcome paying less).  But I don't want to be a tax expert.  And I don't want to be forced to hire one.  And I don't want to spend so much time managing our taxes when it should be spent managing our business… 

There must be a simpler way for businesses to contribute to their governments. 

A scar upon our city?

I have to admit I wasn't engaged in the discussions surrounding "the Dame block" and the CentrePointe development in downtown Lexington last year.  I didn't frequent the places on the block, and I didn't follow the day-to-day developments as the debate raged about what to do with the block.  I don't have a sentimental attachment to the issue.

But, today, two aspects of the CentrePointe project have struck me:

  1. The rapidity with which the the Webb Companies razed the buildings, leaving behind a crater of rubble.
  2. The complete lack of any visible activity since.

Only one thing is now missing from the CentrePointe development: Actual development

CentrePitThe Webbs promised Lexington that CentrePointe construction was to begin in December.  Now, a month later, activity is yet to begin.

The company asserts that it is waiting for various state approvals in order to begin construction.  Apparently, some of that includes permission to begin blasting an even-deeper pit for the complex's parking garage.  (Blasting…  Sets a nice ambiance for downtown businesses like ours.)

This is an extremely poor economic and financial environment for initiating a major real
estate development project.  One has to wonder: As the financial system has crumbled faster than the Dame block was demolished, do the Webbs
really have the financial horsepower (or backing – they haven't named their "private backers") to pull off a project of this
magnitude?

One also has to wonder…  Why did they proceed with razing the block if they were (and are) awaiting basic approvals to begin construction?  Prudence would dictate waiting until approvals were in hand.

Finally, one wonders…  Who is accountable for this scar upon our city if, perchance, the unnamed Webb financers do back out?  CentrePit, indeed.

Update, 1/24:  CentrePointe is supposed to house a J.W. Marriott hotel.  This morning, this bit of sunshine from NPR, including the following:

Still, it's hard for many businesses and people who don't have the very best credit ratings to get loans.

Arne Sorenson is the chief financial officer of the hotel corporation Marriott International.

"There are clear signs of improvement, I think," he says, "not withstanding that there is an abhorrence of risk."

Sorenson
says it's still almost impossible to get funding for new hotels, even
for low-risk projects that he says make sense right now
. He says banks
just aren't lending enough money. And that hurts the economy.

At
Marriott alone, he said, "there are thousands of jobs that are not
being created that normally would be created. And that's entirely due
to the lack of credit available to fund new hotel projects."

[where: E Main St & N Limestone St, Lexington, KY 40507]

When markets don’t work

Michael Lewis and David Einhorn have written the best summary I've seen of why the recent financial meltdown happened, in an amazing editorial in the New York Times.  Their very long, very well-done article (Part I and Part II) details both how regulation failed and how it is integral to smoothly functioning markets. 

Einhorn is one of the real heroes of this meltdown.  As a brilliant and wrongly-maligned hedge fund manager, he was one of the first and most articulate critics who chronicled the outright fraud, misconduct, willful ignorance, and inbred conspiracy perpetrated by financial companies (like Allied Capital and Lehman Brothers), bond insurers (AMBAC and MBIA), ratings agencies (S&P and Moody's), and government regulators (SEC, Treasury, and the Fed). 

This meltdown (and the hundreds of billions we're throwing at it) are the results of an unfettered, unregulated, so-called "free" market.  Einhorn and Lewis demonstrate why regulation is necessary to a healthy, functioning marketplace.

Discovery tale: Do you have a Bugatti in the garage?

1937-bugattiThe recent discovery of a classic, rare, and dusty 1937 Bugatti in an old English garage got me thinking.

The Bugatti fits neatly into the popular imagination as a kind of "discovery tale".  Discovery tales are those romantic, hopeful stories about finding some valuable piece of treasure in an unexpected place.

The discovery tale permeates our culture:

  • The Rembrandt (or Picasso) in the attic
  • The winning Lotto ticket
  • The mid-19th-century stock certificate left by a long-lost aunt
  • The pot of gold at the end of the rainbow
  • The gambler who wins the big jackpot in Vegas
  • The starlet discovered in the drugstore
  • The search for El Dorado
  • Cinderella
  • The Antiques Roadshow

These are all stories built around the discovery tale.  Usually, the tales result in untold millions for the "discoverers": the family who found the Bugatti will be getting nearly $4.5 million.

It is a compelling story.  Except that it is totally unrealistic.

Don't get me wrong — I really like these stories, too.  As long as they are treated as fun, fantastical tales.

When the discovery tale becomes a personal strategy for wealth or success, it is a problem.  It is deadly when it becomes a build-it-and-they-will-come business strategy.

It is a problem in two ways.  First, it promotes faith in a highly unlikely outcome.  What do I mean?  Let's be generous and suppose that there are 100,000 Bugattis (or Rembrandts or jackpots or stock certificates) in the world.  Only a fraction of those Lotto tickets are going to be found in any one year (it took nearly 50 years for the family to find the Bugatti – there's a reason that such discoveries are so rare and notable).  Again, let's be generous and assume that 5% of these (5,000 or so) are discovered per year.

At this point, there is literally a one-in-a-million chance that you will be the discoverer of the next Bugatti in 2009.  And that's after being generous with our assumptions.

If you are now tinkering with the assumptions — "Maybe there are really a million Bugattis and there's really a 20% chance of finding one…" — please STOP.  It is nice to hope, but it is destructive to manipulate the odds in order to justify hoping.

The second big problem with discovery tale strategies is that they are passive.  Discovery tales encourage waiting and hoping as a substitute for industry and ingenuity.  People put off getting a better job or starting their own business while they wait for "things" to get better or for their lottery ticket to come in. 

So am I a total cynic?  No.

Everyone has undiscovered treasure.  But you don't find it.  You use it.  Your treasure lies in your hands and between your ears.  You are the garage — go make your rare Bugatti.

[where: United Kingdom]

Two ways

There are only two ways to live your life:
One is as if nothing is a miracle;
The other is as if everything is a miracle.
– Albert Einstein

As I see the world through my 2-year-old son's eyes, I'm constantly reminded of the everyday wonders we sometimes take for granted as adults.  I've always liked Einstein's "two ways" quote, and have tried to maintain a child-like amazement at what I encounter in life.

Jaded people (the "nothing is a miracle" people), frankly, bore me to tears.  It is far too easy – and lazy – to pretend that you've been there and done that, and that there is nothing new or wonderful in the world.  Ultimately, that cynical attitude stunts one's ability to grow, learn, and change.  It isolates jaded people from others.

I was talking (debating, really) with a group of business leaders the other day, and it struck me that there is a nearly identical "two way" attitude division in the business world. 

The Lazy Way
Some companies approach their business with a cold, calculating, flinty-eyed precision.  These companies look at business as a pure numbers game.  They often see their customers, suppliers, and employees as opponents or obstacles or dupes to be taken advantage of in their pursuit of the almighty dollar.

They see every relationship as an opportunity to "take" — in fact, "relationship" is seen as a soft, weak, and silly notion which has no place in business.  This is the case among executives at my last company

In their lazy reliance on numbers, such miserly companies manage for the short term, the "quick fix" — "Let's make a mint before the customer (or employee or supplier) gets wise to us!"  Eventually, these companies get so disconnected from customers and employees that the dominant day-to-day focus of the organization is on internal politics and positioning. 

From my experience, I can tell you that such shrinking companies are miserable places to work, and they ultimately suffer long, slow, painful deaths as customers and employees flee in droves.

The Generous Way
Other companies adopt a fundamentally different philosophy and approach to their business.  They approach business with a spirit of generosity.  They see that building long-term relationships with customers, employees, and community creates both financial and human rewards.  While the numbers might inform their choices, these companies make decisions based on doing the right thing.

"Doing the right thing" shifts the focus from the financial numbers to the human equation. Doing the right thing isn't easy.  It can be hard work.  It isn't always profitable.  "Right thing" companies usually grow more slowly than "quick fix" companies (at first).  But they do continue to grow when quick fix companies fade (or implode). They build lasting relationships which sustain them through good times and bad.

The "right thing" companies still pursue profit, but their primary focus is outward: on generous relationships with their customers, their employees, and their communities.  They trust that the profit will follow.

These growing, vibrant, connected companies are engaging and rewarding places to work (and to do business with), and they have long-term employees and customers.

Everything is a Miracle
As the economy weakens, many companies have scrambled back to the quick fix of analyzing cold, hard numbers (and charts and plans) and have abandoned their "soft and fuzzy" relationships with people.  The numbers make them feel safe and precise and comfortable.  But they aren't any of those things…

They might not know it yet, but they are the walking dead. 

The companies who will ultimately thrive in this economy (and who will drive real economic growth) are the ones who continue to connect with their customers, employees, and communities — and who continue to do the right things.

But Albert Einstein could have told you that.  My 2-year-old could have told you that.  It is just that simple.