121. Full-Employment Woes? Reinvent Service-Value!

2020 Companies, Concierge Customer Service, Core Renewal, Cost-to-Serve Math, Index, WayPoint Analytics

Nov 2, 2018 Employment News

 250,00 new jobs were added to the economy in October. Unemployment dropped to 3.7%: a 40-year low. Yearly wages increased 3.1%: the biggest gain since the financial meltdown 10 years ago. The best young employees are starting to job-shop and hop. Besides more pay, smart ones want:

  1. A believable and engaging vision, strategy, and culture – that will reward all stakeholders.
  2. And, personally: job security, pride, education, growth – all with great team satisfaction.

Reality-Check Questions:

  1. Do you offer what the best want?
  2. If not, do you think that you can only afford to pay “fair” wages for “good” efforts that deliver “decent” service value?
  3. Isn’t that a commodity service-value wrapped around your commodity products?
  4. Won’t “Price” be the tie-breaker in your commodity hell?
  5. Doesn’t this lead to an aging, coasting workforce and downward spiral?
  6. Are your “fairly paid” employees giving their engaged best?
  7. What new vision, strategy, and culture changes will re-engage them?
  8. Better service-value for most net-profitable customers is a believable vision/strategy. But how?

Initial Service-Value Reinvention Steps:

  • Do two customer-profitability ranking reports: one for big, (20/80) margin-dollar accounts; the other for bottom 80% small-margin-dollar accounts. (Ignore initially biggest losers at the bottom of both reports.)
  • Sort the top 30+ most net-profitable accounts into segments (or niches).
  • Do field research with 5 most-progressive customers (per target niche) to find more service metrics that will solve their – “What do we do service-wise that bothers or slows you down?” – answers.
  • Sign up all associates to:
      1. Better measure and achieve excellence at both old and new service metrics.
      2. Do extra-effort service heroics for your 5 most profitable and 5 best potential accounts.
      3. Focus on growing Gross Profit Dollars (GP$s) per Headcount. Gains will pay for what best new talent is looking for.
  • Freeze headcount. When improved service-value wins more from your best accounts, you will get too busy. Don’t hire more people, pick a few losing accounts from each ranking report to create order-consolidation. Redeploy the fulfillment-slack into the best-account, new-growth in hand.

For detailed, reinvention specifics email me for a free copy of my: Core Renewal Roadmap (6800 words; bruce@merrifield.com).

Conclusions

If you don’t follow this renewal advice, what is your Plan B? Why not (at least) skim my Roadmap and discuss what ideas, questions, and concerns it provokes? Name and change your historic, habitual, sub-optimal beliefs to become a service-value winner and talent magnet.