The Hair Shop blog

Believe

In order to get anyone to buy in to your idea of change, whether it is your employees or your managers, you must do one thing and that is Believe. Believe in what you are promoting, and believe that what you feel needs done will work. If you show that you are unsure others will be unsure. If you show you have doubts others will have doubts. If you stand up and state clearly that your belief is this change is what needs to be done then others will follow and support you. When you talk about the change you feel is needed you should express how much you believe in it. There should be no doubt in anyone persons mind that you whole heartedly support the idea, and you believe it is what needs to be done.

Now when you are tasked to make important decisions your job and future with that company could be dependant on these changes, so always insure you did the research and have the data to support your stance. But once you have it and you feel this is what needs to be done leave no doubt as to where you stand on the issue.

People who follow others are called the believers for a reason, but the biggest believer should always be the person leading.

Believe Quotes

Believe Quotes II

6 Sigma not an Enigma

Working for GE did have one advantage, generally when they made a change there was plenty of data to back it up. When talking about promoting change and how do you get buy in, supplying good hard numbers generally does the trick every time, and with 6 Sigma you get these numbers. The good thing about the 6 Sigma process is when it is done correctly drives down to the root of the problem, which enables you to make changes that have a higher impact. Executives love to here that you used this process or any process when looking to make improvements, and will be more likely to support your suggestions because of this.

Green belt training all though very difficult was very enlightening for me. It made you really think about what the cause of a problem was and not jump to conclusions, and has been very beneficial to our facility. We have saved a lot of money over the last seven years using the process of 6 Sigma, and we continue to use it today even though we are no longer with the company.

One project in particular stands out in my mind. Everyone believed we had major issues with our case erector and on the surface looked as if we were going to have to spend an about $200,000 on a new one. Once we used the process we found that the case erector although the tolerances were very tight was not the issue, it was a $275 part on the filler itself that was causing all the issues. Upon replacing that $275 piece we not only eliminated 70% of the down time on the case packer but we also eliminated 90% of the scrap. Examples like this is why executives and managers listen more intently when you use the process, this is why they back your project instead of the next managers, and using tools like this is how you can promote and drive change in your business.

Remember nothing gets the investment boards attention faster than good old fashion data.

GE 6 Sigma

Six-Sigma Experts

Nine block means Tenth manager out

Employee turnover, something we all are told we need to control in order to control, because if you have low turn over you have a happy work force. Not necessarily, you could just have a high paid unhappy work force. I like when the book talks about the efficiency loss because most people only think about the cost running the ad, interviewing and training, and they never consider the cost of a person that is not experience and will product less than the person that just left. Assigning a trainer to them is inefficient, double-checking their work is inefficient and fixing their mistakes is inefficient. All of these go directly to the bottom like and can be very costly to a company, and for those with tremendously high turnover you can never reach your true potential because you are always in the training mode.

So does this mean that all large successful companies focus on hiring and keeping good talent. Yes and No. As the example of GE

goes they expect and want to turn over 10% of their management every year. They do this for several reasons, first to insure that they always infuse the company with new talent and ideas, always have what they rate at the best employees in the chain and to eliminate low performers. Now I do not totally agree with the system but it has worked for them for a very long time and they do make billions every year. But as I was an insider there is a flaw in the system that does not seem to cause total failure but does cause the loss of good personal which is not its intended purpose. The Nine Block system is what they use, a three by three grid with the left axis (1 thru 3) being performance and the base axis (A thru C) being environmental and safety. So for and example a manager with a 1/A rating would be the highest, a 2/B would be average and any manager with a 3 or a C in the rating would be put on a 90 day improvement plan. Now if you have a 3/C your will be out of the plant within 30 days of notification of your score.

The issue lies in the forced ranking of the managers, because your whole future is reliant on your manager being aggressive, well spoken and tough enough to speak his mind and hold his own in the war room type setting were everyone is trying to talk up and support their own direct reports. If he or she is not then you and the other managers their team are in trouble, because this interaction is what your raises are based off as well as your future promotions and employment status. I have done this with my boss and other managers in our plant when ranking our hourly employees and it is a tough situation and there are several managers that do not have the gift of arguing a point that some people I know do and their employees suffer as a result.

Download nine_block.doc

CRM

When dealing with your customers do not waste their time, there are way to many sales people that need to learn that lesson. You are not managing your accounts you are creating and hopefully growing a positive relationship with a customer that will generate loyalty, helpful feed back, stabilizing your client base and increasing sales. So do not go in to a meeting without basic information that any client would need or want. I had a salesman come in last week to talk about our business and any potential new chemicals we might be looking into from and R&D stand point. When I asked about several of our chemicals and a current price list he did not have it. When I asked about a list of containers that his company showed we had on sight that I could use as a cross reference (a list I have been asking about for over a month) he did not have it. When asked if he had a current catalog or a chemical list of items his company distributed he did not have it. Now I would like to say this was a new salesman but he has been on the job for well over two years at least. This did not do very much for watering the garden and growing our relationship, and it did nothing in the way of growing his business. As a matter of fact I hate to say it but I was like the Soup Nazi in that Seinfeld episode when I basically told him “No order for you, get out”.

Well I did a little more than that, since I have know him for over two years I came straight out and told him that I have never seen a sales person that had no product list for the company, no price list of current items a customer buys and take over a month to get a simple list that is on a weekly print out (his own words) that he sees every Wednesday. Then he had the never to ask what price I was quoted and paying for a particular product from one of his competitors. At which time I questioned his mental capacity and told him that would be unethical and he needed to leave.

What a way to ruin a customer relationship, and now after a call to the regional director which was my previous sales rep from this company I have to talk with this gentleman’s replacement next week.

CIO.com on CMR

Customer Relationship Management Association

Suggestions generate value

On page 57 at the top of figure 3.2 you see suggestions for improvement. No I have never been asked to provide my suggestions for improvement, other than the standard survey that everyone gets.

For Mocrosoft they say that when the service packs come out that customer feed back on what they would like drives it, and the items are added or modified. Not sure who requested that the system locks up at least three times a day but that is one they could have left off in my opinion. But this system is very customer driven and helps them keep their customers happy and cost down. While the customer gets what they want or feel they need, the company only provides what is desired and saves time and money on not providing and updating programs people do use or they feel are unimportant to them. This is a great example of streamlining a product to meet your customer’s needs and how that knowledge can add to your bottom line as a company

I have a friend whose father has never driven anything but a Ford, and in return he has always had at least one Ford in his drive was as well. Being the loyal customer that his father is, Ford has asked him several times to preview new production versions of their trucks. He happily attended every invite at which viewed, test drove and provided feed on the new versions. He was very excited when the new models rolled off the line to see if any of his suggestions were taken and made a reality. Now they did use one of his, he was probably one of many that had the same idea, like or dislike. But when the truck rolls out he and he sees there had been a change it makes him feel that his input was very important, and the talk leading up to the roll out is non stop.

Both of these are great examples of using customers to improve your service and product that they use while reducing.

We had a distributor summit at which we had users of our product talk with distributor about why the liked our product some much. At which there was a gentleman who was a fire fighter in Key West and when the hurricanes hit he used our silicone to seal up every window and door in his house because of the potential flooding, he even used it on his truck doors and windows on the vehicles he could not get out in time. Well he made a tremendous impact on our distributors when he talked about the 5-foot deep floods from the tidal surge and how his house was the only one that had no interior water damage at all. Also his truck interior was perfect with no damage, as a matter of fact it was so perfect that the insurance company refused to pay for repairs to the motor due to flood because they did not believe him.

Great impact on or distributors and generated a lot of talk as well as sales about our product going forward.

Microsoft info

Kung Fu

Reading a lot of the different info on the Loyalty Ripple Effect and the pebble in the water makes ripples across the ocean. Makes me feel like I am watching an old Kung Fu rerun and someone is trying to snatch a pebble out of a blind guys hand.

Both of these links deal with the ripple effect, but the blog is about employees and the other is on customers. We all here if you treat you customers right and give them good product they will keep coming back. Though this is true and they will probably bring friends with them you cannot forget that your employees are the ones making contact with them. So your employees are the in essence giving the customers the pebbles that will be cast when it comes to how does your business treat people. We have all been to that restaurant with the waiter or waitress that is not happy about what they are doing, and it inevitably turns the dimmer switch down several notches on the experience that we had. Friends of ours may hear about how good the food was but the service was terrible, so if they have a choice of two places that both have good food why choose the one with terrible service.

So remember if you want your customers to cause a good ripple, then your employees need to giving them the correct pebble to toss.

Blog on Ripple

9 Customer-Centric Morals

Life Time Value

A customer’s lifetime value, what a wonderful idea, sometimes I wonder if a few retail establishments even consider the value of a customer at any given time during a sales transaction.

My wife is a cosmetologist and has been cutting hair for many years now, and when one of her clients arrive she will always ask if they want something to drink. On occasion they will and when they do she will buy the drink from the machine for them. When asked why her response is because that person comes in every six weeks and pays me $125 for a service she could get somewhere else. Upon watching several of the other ladies I saw repeated times where a lady asked the same question but when the response came back yes they asked the client for the money. I asked them about this and the response every time was, the soda in the machine is $1 each and that could get expensive. I tried to explain that since word of mouth is their #1 form of advertising that doing the little things along with giving a terrific hair cut could bring in more referrals, and that the $8 dollar per year investment that they made for a return of $945 dollars was well worth it. But the potential of one referral that could net an additional $945 dollars a year was the main reason the $8 investment should be made.

Doing the little things can not only bring people back for more but it can bring their friends and family as well, and you must always consider this before approaching a customer and treat them accordingly.

Referral

Value of Referrals

Eutrepreneur.com

VPC

The Value Profit Chain and Wal-Mart a great example of a company looking for low prices to better serve the consumer. Well yes and no. I know the book talks about the fact that yes they do put some small stores out of business but they employ more people thant he stores that they put out of business so that is good. They do have tremendously low prices and the consumers do benefit from this, but some of the consumers work for the companies that they purchase from and this is where the issue lies.

The large companies that work with Wal-Mart can do well and financially can do so and remain profitable. It comes when a smaller company starts doing business with them that you see the problem. Most small companies that start doing business with them are very happy to do so, even though they had to go into serious dept to buy the self-space for their product. It is when they expand their volume that the small companies can only supply them and when you only have on customer you are at their mercy. Many smaller companies have learned this the hard way. So they are not just driving small retailers out of business but also small manufactures as well, because they cannot compete and supply the product volume or at the set point for cost.

I do like the example of the volume per square foot and the volume per employee, I started using a similar measurement at my work and it has been adapted across the division. We measure pounds per labor hour in order to show true productivity, and this has been a great tool at showing what improvements we are making in the plant.

Like other large companies that use the VPC we advertise it to our customers as to show how we are helping them, but it still all comes down to meeting the company goals on profitability more than doing what is best for the consumers. But that would not sound as good in a commercial now would it.

Value Profit Chain

Harvard