Be Absolutely Fearless!

Peter Drucker once said that the best managers and leaders were those who knew how to ask the right question, not those that were always trying to give the right answer.

 

I am a big believer in organizations using their staff to create change, build new policy, and envision what might be possible. I am going to suggest exercises (we like exercise after all!) that I hope will build up our strength and stamina for seeing what is possible and finding new ways to get things right for your customer.

If you actually do these exercises, it will require that you select who will do them with you.  I always like to have key leaders but it is a great idea to have some of your frontline participate as well.  As long as you have a culture where speaking up is a safe activity.

Exercise #1 – Differentiate

Purpose of the exercise – Discovery of the most impactful areas to boost your customers’ love for your company and their loyalty to it.

Get with your team and start the meeting with the statement – “Next Monday we are going to switch every contract we have to month-to-month and we will do it automatically. We will also begin selling only month-to-month memberships and we will offer a 100% unconditional money-back guarantee in the first 30 days.” 

If you don’t do this already and if the people you assembled are the right folks – this should scare them. Think hard about who should be a part of this exercise.

Okay, now that you have them scared and all talking at once, let’s ask the right questions:

  1. Why do you think people would leave us if we did this? You will get a few different answers here.  To each answer keep asking “why” until you find the root cause.  Get feedback from everyone.  This could be a long conversation.  You should facilitate and capture the essence of what people are saying on a white board.
  2. What would our organization have to look like for all of us to be absolutely fearless about going to month-to-month with a guarantee? Try to capture the essence of what people are describing.

The exercise should bring out areas where you can innovate around customer needs. The essence of this exercise is that people don’t buy memberships. They buy solutions just like in every other purchase in life. 

The gap between the fear of going to month-to-month memberships with a guarantee, and the security and readiness to do so, is a proxy for the degree to which you sell memberships as opposed to solutions. After all, a membership is only a solution for the most dedicated and advanced exerciser.

Exercise #2 – Organize

Now it is time to organize your data. Use your team to measure the urgency and the impact of each idea that was captured for the second question. Some of the information will have to do with plant and equipment and some will identify processes and services. I suggest you separate these and then rank each category.  First rate each item in both categories for urgency.  You can simply give each a 1-10 rating with 10 being “most urgent.” When measuring for urgency you will usually discover stuff that is already “on fire.”    Next, give each item a similar rating for impact.  When measuring for impact you are looking for what would affect the greatest number of customers.

 

New innovations usually fall under mid to low urgency but high impact.  For example, suppose one of the ideas you captured is an end-to-end process to guide members that need help.  Since it doesn’t exist yet, it isn’t directly causing issues.  So it has less urgency.  But maybe it is such a good idea that it would be a game-changer for your business. That has a lot of impact.   By comparison, a glaring hole in service and hospitality training usually falls under high urgency and high impact.

Exercise #3 – Take Action

Okay, now it is time to take action. If there is something that is very high impact but low urgency, create an initiative to build it out. Choose the items with the highest urgency and the highest impact to start addressing now.  Create action plans with hard dates and crystal clear commitments.

Lastly, this was a spectacular exercise for us when we did it years ago.  I have taken other groups through this same exercise and it is always an eye-opener. Mostly people get excited about the possibilities.  When your team starts to ask “What if…?” – that is when you really start to get traction. This is not for the faint-hearted and is only for those who wish to focus on differentiation through the evolution of their business model.  I believe innovation in our industry will come from many of us having these types of discussions. As it stands today, we lean on innovation coming mostly from equipment companies.  Our industry is long overdue for innovation around the design of solutions that solve real problems.

Whether you actually intend to go to go to month-to-month with a guarantee is not relevant.  Being able to do it without fear is. Take control of your customer experience.

Blind Loyalty--Are You Guilty?

What the heck? Blind loyalty, such an interesting term. According to Urban Dictionary: Blind loyalty involves being loyal to a person or cause despite the damage the person or cause does to himself or herself or others. Versus: Loyaltya feeling of strong support for someone or something, Merriam-Webster. Are your customers and employees loyal – or blindly loyal? Before you answer, think about this:

 

 Blind Loyalty, what does this mean exactly? Think of your pet! Now there is an example of blind loyalty. You work 12 hours a day, the pet is left alone, and yet they are so happy to see you when you get home. Maybe you are a great pet owner or an abusive one. Your pet is still loyal and still loves you no matter what.  And parenting! No matter what kind of parent a person is, young kids are loyal and want to impress (at least until the teen years!). I consider myself a good parent but I’m sure some day one of my kids will tell their therapist about something I did as a parent that has caused them grief as an adult.

As adults, we think we like something, and are loyal to it, whether it is a business, a person, or a product. Until that business, person, or product does something outrageous to cause mistrust. BUT, why we do wait until that moment?! As business owners/managers, why do we wait until our customers are angry or sales are declining? As consumers, why do we wait until the business or product disappoints? As employees, why do we wait until we can find something better?

If you have customers and employees, chances are YOU are blindly ignorant. Ignorant to the fact that perhaps your employees only work for you because there isn’t anything else available or your customers are customers because they haven’t discovered something better. Don’t be that guy/gal! Loyalty starts from the top.  If you run your business on loyalty and truly care about your employees as human beings and care about the product or service you are offering, then LOYALTY is what you will have, not Blind Loyalty. Don’t assume your employees and customers love you or what you do, KNOW.  Ask, find out, LISTEN and truly learn from your people and customers. (Notice I said learn. This is different then TELL.)

If you are the boss or the manager, find out from your people what makes them tick. Why do they love working for you and your company? Let them be candid. If you have truly loyal staff, you will have truly loyal customers. Be true and be loyal to your people and profits will result.

My goal is to never hear something like this about my company, my people, or my product:

“You guys are insane. Working like dogs and retaining blind loyalty to some jerk of a boss who doesn’t give a toss about you.” Urban Dictionary

May it never be so.

8 Customer Service Disciplines of Excellent Front Desk Team Members

When you visit dozens of health clubs and see thousands of comments and survey results from gym members at hundreds of clubs all over the world, you start to concatenate characteristics from top performing clubs into a picture of real excellence.  From these observations and from teaching Customer Experience Excellence and Operational Customer Experience Management, I have came up with what I think defines the best of best.   These “8 Disciplines” (8D) can be taught. In fact, I am putting the finishing touches on a “course” in the 8 Disciplines.  I call them Disciplines because I believe if you break any of them down you can be very disciplined about how you teach, coach and improve each.  They become “Disciplines” when they are practiced every day.  In the course I define each Discipline with a clear purpose, an affect, and a result.

For starters, if you have all “A” players, learning the 8D will up-level them even more.  If you have “B” players, they will become “A” players.  If you have “C” players then what the heck are you doing? Go find different players!!

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Some of the 8D may seem obvious. But when you accurately capture purpose, affect and outcome, they take on a whole new level of nuance and detail. Once the three elements are defined then you can get “hard edges” as to HOW one can be consistent at each, and become a “practitioner” of the 8D.

One more thing; this all based on the belief that the Front Desk purpose overall is too be great hosts.

Onward…

  1. Greeting People – Obvious? Yep. But this is an art form when done by the best.  There is constant humor, warmth, graciousness, positivity, personality, and human connection.
  2. Name Memorization – There are great ways to teach this.  The very first thing to teach is to stop saying “I am not good at remembering names.”  Replace it with “I used to not be good at remembering names.”  This sets up the training for success.  It is a good idea to create a “name memorization” challenge that has to be passed in order to be hired. That would help!
  3. Gaining Insight – Deliberately learning something about each member no matter how small. Then use that insight to learn more. This “intel” allows for personalizing the member experience.
  4. Offering Information – When we have knowledge of something that could affect the member’s visit, either positively or negatively, be proactive in offering it up – “We had a leaky pipe in the women’s locker room last night. We have it handled but I apologize that it is still a bit messy.”
  5. Anticipating Need – This just might be the single biggest differentiator of all.  It is one thing to do something for a member when they ask. It is quite another to see a member coming in the door with arms full then running out to unload her and help her with the door.  Or suppose a member comes in and says – “I haven’t been in in 4 months and I got out of my routine.  I even forgot my water bottle!”  The best of the best will be taking them a bottle of water as soon as they get on the treadmill and will probably say something like – “Welcome home.”
  6. Solving Problems – Issue resolution is all about personal responsibility and ownership.  Well, it is also about empowering your people to actually resolve issues in creative ways if necessary without having to escalate. Scary?  Fears about real empowerment are almost always unfounded.
  7. Making Introductions – This is what hosts do.  Teaching people when to introduce members to one another as well as to other staff members will set your team apart and send a strong message of inclusion to your member. Hint – Introduce when it adds value for both parties.
  8. The Fond Farewell – Can’t tell you how many comments I see about how dazzled a member is when team members give a fond and personalized farewell.

Wouldn’t it be amazing if all staff were practitioners of the 8D?  Not just front desk. I am on a mission to teach the 8D to as many staff members as possible.  Beginning with my own clubs and then hopefully yours too.

Please share any comments or thoughts!

MOMENTS OF TRUTH

This post is a guest blog by our friend Annette Franz. Enjoy!

Do you know the moments of truth for various tasks customers attempt to achieve with your organization? Before you can know or identify your moments of truth, you must first know what that means.

So, like I usually like to do, I’ll start by defining the concept.BusinessDictionary.com defines moment of truth as an: instance of contact or interaction between a customer and a firm (through a product, sales force, or visit) that gives the customer an opportunity to form (or change) an impression about the firm.
TheFreeDictionary.com states that a moment of truth is a critical or decisive time on which much depends; a crucial moment.
And, contrary to popular belief, Jan Carlzon did not come up with the phrase when he wrote his book by the same name. The phrase was first introduced by Richard Normann, who was a strategy consultant for SAS when Carlzon was CEO. Normann defined it as that moment where quality as perceived by the client is created.

While Carlzon did’t coin the phrase, he popularized it with his book. Carlzon’s definition of “moment of truth” is: anytime a customer comes into contact with any aspect of a business, however remote, is an opportunity to form an impression. In his book, he states that those moments determine whether the company will succeed or fail and that they are moments when companies must prove to their customers that they are the best alternative.

So, you get the idea; it’s an important moment. I usually define moment of truth as that make or break moment in the customer journey, that moment when, if all goes well, the customer will continue the journey and complete the task or interaction; he will do (or continue to do) business with you. If things go awry, he will not complete the interaction and will go elsewhere.

I don’t agree with Carlzon that every touchpoint, every interaction, is a moment of truth. I think he’s right that every touchpoint is an opportunity to form an impression, but I don’t think every touchpoint becomes a make-or-break point. Think about the customer journey to purchase a product online, for example. Is every step, every touch critical? No. Every step is certainly important to the process, but there are only a few that will ultimately be make-or-break points for the customer to want to (a) complete that transaction and (b) buy again.

Let’s take a closer look at Normann’s definition. I’d never heard “moment of truth” described using this definition of value or posing it in terms of value creation; it’s an interesting way of looking at it.  Thisvideo by FutureSmith explains Normann’s definition and the value-creation concept further.

Link to this video

In the video, the narrator (Don Smith) presents the concepts of vicious circles and virtuous circlescreated by failed and successful moments of truth, respectively.

A vicious circle occurs when failed moments of truth form a chain reaction; he states that once a company slides into a vicious circle, it’s difficult to get out of it. A vicious circle is defined by negative, defeatists attitudes that create a toxic culture where customers are considered the enemy and are hated and ridiculed.

The opposite is true in a virtuous cycle, which happens when successful moments of truth propagate more successful moments of truth, i.e., the positive energy from one interaction spreads to the next and creates more successful moments of truth. Customers who experience positive, successful moments of truth are positive going into future moments of truth – and they tell others about their experience. Employees feel good because they feel valued, and they are part of a contagious positive energy that is hard to extinguish.

Either way you slice it – vicious or virtuous – those moments of truth are moments that matter; they matter to the customer, first and foremost, but they subsequently matter to your employees and, ultimately, to your business.

So let’s go back to my original question: have you identified your moments of truth? If not, identify tasks that your customers are trying to complete and map the journey. (And act on your findings!) What happens along the way that causes customers to stay? to flee? If you know what they are, then what are you doing to execute them flawlessly?

I guess they’re called moments because they don’t last very long. -Sarra Manning, author

Annette Franz blogs at CX Journey, where she shares her passion for helping companies understand the importance of the employee experience and its role in delivering an exceptional customer experience, as well as how to transform their cultures to ensure the customer is at the center of every conversation. She was recently recognized as one of “The 100 Most Influential Tech Women on Twitter” by Business Insider and has been recognized by several organizations as a top influencer in Customer Experience. She is an active CXPA member, as a CX Expert, CX Mentor, and a SoCal Local Networking Team Lead; she also serves on the Board of Directors.

Counting Smiles

Today I did an informal experiment. As I was riding my bike to work, I decided to count how many people either returned my smile or said good morning/hello or some other acknowledgement (even a head nod!). No, it wasn’t too early and it was a gorgeous day! – I live in an amazingly beautiful area with a bike path that connects two towns on either side of the Columbia River. Along the way, it is quite normal to see eagle, osprey, fish jumping, salmon fisherman fishing, and even some other unsightly creatures (snakes, skunk).

In other words, the reasons to be happy, to be smiling, to be friendly were numerous! We are alive, we are able bodied enough to be outside enjoying the beauty and breathing clean, fresh air!

Back to my experiment: my trip to work is only about 45 minutes of brisk biking but I passed no less than 47 people. I am not counting the ones who were plugged in or chatting away with others and, therefore, would not hear my cheery voice. 47 people (plus the others with headphones or friends)! Isn’t that amazing? So many people up and exercising and enjoying the outdoors. Guess how many people smiled back at me? Or acknowledged me in any way? 13. Yes, only 13 – roughly 26% I was overly cheery and loud with my greetings and still – only 13. That makes me wonder: what is going on in their minds that they are choosing to not be present? (Perhaps they thought I was a bit loony or “one of those annoyingly happy morning people?)

Which leads me to this article – how often do we go throughout our day not being present? What are we missing by letting our minds run ahead? How many people do we not connect with by not paying attention to our surroundings and missing the best parts of our day? It’s so easy to get absorbed in what we have to get done, our stresses, or our life but by not being present, we might miss that open door to the next greatest opportunity. Even the missed opportunity to really “see” and acknowledge some really great people!

Do you know WHO those 13 people were? They were the ‘seniors’ (older than me!) who I suspect were out there because: 1) they had the time 2) they enjoyed the beauty of the outdoors or even 3) perhaps they wanted to make someone’s day better by offering a hello or a smile. I can see their smiles, the look of peace and contentment. For me, they reminded me just how much a smile means. They made my day brighter.

Even if you don’t have the opportunity to ride a bike to work or don’t live in a place that is beautiful, there is still joy in being alive and being in the moment. Take a look around – I’m sure you can find at least one thing to smile about?

A smile is easy. A smile is cheap. A smile can make someone’s day. The best gift you can give yourself is to make someone’s day brighter by offering a free smile. Enjoy!

How do you practice being present? What makes it hard for you to be present? Please share with us.

LOOK AT ALL THE SMILING FACES!

Our company, (Club Works), delivers customer experience management (CEM) products developed in partnership with Medallia Inc.

MXM is the only “retail” CEM system developed exclusively for use in Health Clubs. Club Works currently serves approximately 400 health clubs, and we’ve been in business for about three years. Over the course of those three years the MXM system has received over 300.000 completed club member surveys, and we have worked closely with each club in our network to insure that the customer experience data that MXM provides finds its way in to the operating culture of our customer facilities.

MXM is unique among health and fitness CEM systems in its use of both “structured member feedback” (0-10 ratings of key club metrics) and “unstructured member feedback” (written commentary provided by the member). MXM doesn’t stop at “Likelihood to recommend” and Net Promoter Score (NPS). It is what Fred Reichheld (inventor of NPS) refers to as a Net Promoter System. We pull in data on 20 to 30 key club service components that describe the total member experience at MXM supported clubs. We’ve moved a ton of data over the last three years delivering a full throated, and comprehensive “Voice of the Member” to our customers, and we’ve mentored owners and managers in responding to member inputs.

An interesting tendency has emerged among our customers that I think applies to club owners and managers generally. So what kind of customer feedback draws your attention? Maybe this……..

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Putting this little orange guy in the context of a member survey response, he/she is telling you that you’ve failed to deliver on your brand promise. Maybe he/she is thinking of leaving your club or worse, telling everyone on Yelp! how horrible your club is.  Fixing your little “orange face” is nice and tactical. It will help with attrition, and if you can fix every “orange face” those comments on Yelp! will be less negative; maybe your Club NPS score will go up!

Fixing the problem is a good thing ———but there was a lot of yellow in that picture and lots of smiling faces.

In a pure retention play all those little yellow guys wouldn’t matter, but if you are really managing your member experience you need to understand and act upon the positive aspects of your member experience too.

  • Knowing where/how you’ve exceeded member expectations can guide future programs, products and practices to deliver more happy yellow faces.
  • Positive member feedback will vector you to those areas of your business are really “killing it” from there you can investigate migrating that success to other areas of club operation.
  • Of course, there is also tremendous value in positive feedback for training, recognizing, and rewarding employees.
  • When the aggregate member experience is impacted negatively by things like remodels, dues increases, equipment fees, summer kids tennis, winter parking challenges, Etc. Etc. How nice to have a good handle on those things your members like and value by way of facilities, programs and products to mitigate bad feelings. Conversely how great to know exactly those programs and practices that you should never change…. NEVER!
  • Why wouldn’t an owner or manager want to identify the “Raving Fans” within a member base? Those people whom a sales person might want to approach during a “walk through”. Those members who are more likely to bring a friend in to see a club they are proud to be a member of. 

At Club Works we have noted that many/most of our MXM system users tend to over focus on the little orange guy a bit, and I am certain other club owners using competitors products have a similar tendency. Here’s a simple exercise/suggestion.

Set aside just 15 minutes every other day to stop and look at all those 9s and 10s in your MXM (or other systems) database. Read the positive comments from members and investigate those positive comments just as you would negative ones to find the source and extent of positive comments. Record your findings just as you would if you were investigating multiple complaints or low scores related to a specific area of your clubs operation.   Finally, investigate and celebrate the positive feedback you receive from your members. Recognize those members who took the time to tell you all about the things they like/love about your club.

Schedule 15-30 minutes every other day just to look at the “good news” coming in from your CEM system. It will be “happy place” in your schedule and its just plain “good business practice”.

Club Solutions Magazine Guest Column, "Your Innovation Debt"

This week MXM's president, Blair McHaney, has a guest column over at Club Solutions Magazine! Titled "Your Innovation Debt," the article discusses how falling behind on innovative practices can cost you in the long run.

Companies have invisible “debts” that never see the balance sheet. If your company is not embracing technology you are building a “technology debt.” When organizations don’t refresh and replace equipment at a cadence that keeps up with ever-changing standards, it too is “debt.” These debts eventually get paid — sometimes by finally getting caught up, sometimes by losing customers — but they get paid.

The scariest “debt” is the “innovation debt” that builds when a company is not proactively driving changes. In order to tackle the “innovation debt,” it serves well to redefine innovation as any idea you adopt that adds value.
— "Your Innovation Debt" Blair McHaney

Head over to Club Solutions Magazine to read the full article!

Simple...not simpler.

We love NPS. It’s simple. We started measuring NPS (Net Promoter Score) right after reading Fred Reichheld’s December 2003 Harvard Business Review article. LOVE NPS!   It is a great “North Star” for getting company-wide focus on the member (customer) experience. It remains one of our company’s four main KPIs. The target for our health clubs is to maintain a Trailing 90 Day NPS > 70.

But we learned quickly that to really enable the management of the member experience we needed to better understand the member experience. The “likelihood to recommend” question was a great start. But it hid many of our company’s shortcomings as it wasn’t an accurate representation of the entire MEMBER JOURNEY. By itself, it didn’t uncover our members’ deeper ideas, concerns and even valuable praise. We also struggled with accountability – How do I, as a front desk team member, ACCOUNT for my impact on our NPS?

When companies deploy an NPS only approach to Operational Customer Experience Management (OCEM), we see it result in a series of tactics to find “Detractors” and to mitigate their risk of cancelling. This tactical approach to OCEM returns only a fraction of the value one should be leveraging when going through the trouble of collecting member feedback. It also does not reveal the issues (sometimes major issues) your Promoters have with your company.

The first rule of OCEM is to really see yourself as the member sees you. You need metrics that you can track to their entire journey and once they give you that quantitative feedback, they are now primed to give you richer qualitative feedback.

For example, while I am writing this I reviewed feedback from a “Promoter”. This person gave a 10 on Likelihood to Recommend (LTR). They gave their reason as “Great club! Super clean.”Okay, if those are the only questions I allowed her to answer then our job with her is done! But read on. Once this SAME MEMBER had a chance to reflect on (and score) her whole journey, she added the following: “I have had 3 trainers. One left after 2 sessions, the next one was fired after we trained for several months and the third was promoted to another club within one month of us training, Very discouraging. No continuity. Why would I buy another series?” THAT is the information I needed.  Buried in her journey was a major issue. Now, instead of the false pat-on-the-back we would have given ourselves, we have uncovered an issue. In fact this may not be a small issue. Conducting root cause on this might reveal a HUGE opportunity to improve the experience for all of the personal training clients.  But if you are only asking the LTR question and “what was your reason?” you are not getting the value you need.

But we are still talking about tactics. What about your strategy? In order for you to be successful with your strategy, do you need to have a customer service oriented culture? Chances are, if you are in the fitness business the answer is “yes.”

The challenge with an NPS only program is that is very hard to move your customer-centric plans from being just ink on paper to the blood in the veins of your entire team. Getting the feedback to align with the member journey so that every team member takes ownership of the customer experience is how to make that happen.

Enter the science of great technology, survey design and a systematic approach for closing-the-loop, fixing individual issues, performing root-cause analysis and building culture.

The member experience is a complex thing to understand. It should not be treated as a transaction. When done right this complexity can be presented in simple and beautiful ways that engage your entire company. I started with Einstein and will finish with Oliver Wendell Holmes – “I wouldn’t give a fig for simplicity on this side of complexity. But I would give my right arm for simplicity on the other side of complexity.”

RETENTION BY DESIGN

I own and operate two health clubs and in our clubs we relentlessly work to remain focused on delivering great “member experience.” As my own understanding grows about “customer experience” (member experience in fitness terminology) and the memories they create, I hope to share what I’ve learned to continue improving not just our own operations but to have a broader impact on the fitness industry.

Getting the customer experience right requires acute awareness that all interactions between customer and company (people, plant, equipment, advertising, website, etc.) will merge into a single belief about your company.  This “memory” IS the experience.     Experience shapes belief.  Belief shapes action.  Action shapes results.  Say someone walks into your club for the first time and they are greeted warmly and personally. The sales person is genuine, caring and inquisitive about this person’s world.  The club is spotless and there is energetic and friendly conversation all around.

From this experience one begins to form a belief – “These people care and this place is authentic.”  If, when returning the next day, there is someone different behind the front desk talking on a cell phone and not paying attention, I start to question my belief –“Maybe I was wrong. Perhaps it was just the individuals that were caring yesterday, not the company.” 

Getting the experience right can’t be a “sometimes” thing.  It must be pursued “all the time” thing, even if you know that “all the time” isn’t possible. We call this the pursuit of excellence!

 

The authors of The Experience Economy (B. Joseph Pine and James H. Gilmore) explain that if we receive any cues not aligned with the experience we expect, the experience is degraded. At Disneyland, if we see two staff members arguing or a sweeper walk past garbage on the ground, we log this in our memory as a “chink” in the Disney armor. Which by the way, I have never seen. But I give these examples of what would be negative “cues” inconsistent with our beliefs about Disney.  

In our own Member Experience Manual (our internal “Bible” for our gyms) we describe negative cues as “defects,” or, something that will degrade the quality of the product. We create customer experiences. Negative “cues” are the defects of great experiences. Our industry delivers all levels of member experience. Many health clubs effectively apply the same customer experience principles as some of the world’s greatest companies (Apple, Four Seasons etc.). Many are small and connected enough to always deliver a great “home town” experience. But mostly, when it comes to customer experience management we deliver mediocrity.

If we are to live up to our potential as major contributors for solving the current health care crisis, we need more legendary customer care stories than are being generated today.  If we totaled up all stories told about health clubs around the world, it seems the net result would be far more negative stories than positive.   Our goal should not be to merely have more positive stories than negative, but to obliterate negative stories. 

Create so many positive stories that the negative are insignificant by comparison. 

Would that help retention? Yes. We hear that we service the same 15% of the market. Yet attrition is stil 40% (or so). If membership growth in the US has moved from 45 million in 2009 to 50 million in 2011 and attrition is 40%, then over the last three years there are roughly 56 million that have quit. Granted, may of those rejoin somewhere else. But, I am concerned with those who came to use to solve a problem and instead were sold a membership. I am concerned with those that are used to the customer experience they receive from Apple, Starbucks, Disney and others, only to wonder why the same experience hasn’t permeated a business dependent on repeat visits and recurring revenues.

If we are ever to live up to our potential, we must design (Design: to create, fashion, execute, or construct according to plan) the end-to-end experience in a way that connects with and dazzles people when they are at their most vulnerable and we are in our greatest position of power and influence. This is retention by design. The next step is to deliver the experience. No process, policy, or person stands alone.  They all connect in a “customer experience ecosystem” to form what is the experience of our members. 

Share your comments on this topic. Do you have a purposeful system designed to retain members at you health club? We would love to hear from you.

Thanks!

Software to improve the customer experience

The implementation of an Operational Customer Experience Management (OCEM) system is not a tactic or a “program.” It is a business practice just as financial management is a business practice. At their 2013 CX Symposium, Lieberman Research Worldwide stated that in their research, the #1 mistake companies make in purchasing operational customer experience management (OCEM) technology is buying a system that does not enable strategy, is overly simple and is outgrown within a very short time. LRW insisted that companies use technology that can accept and even push a company to become more sophisticated in their approach to CEM.

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Our company, MXMetrics, specializes in customer experience management for health clubs. The health club business is complex when it comes to delivering a customer experience. Health clubs use a “subscription” business model as opposed to a simple “transactional” business model. Designing a system to inform better decisions at every level of the health club operation is a sophisticated process requiring a thorough understanding of different “member journeys.” With an appropriately designed system, you can then apply a proven methodology for improving the member (customer) experience.

The rest of this post will explain the four main elements of the Medallia Operational Customer Experience Management Methodology using some examples from the fitness industry. The OCEM Methodology is based on research of companies that have used OCEM to drive company value by creating greater loyalty with their customers.

  1. See yourself as the customer sees you.
  2. Wire the customer into all decisions.
  3. Drive accountability at all levels.
  4. Innovate and test to discover what will scale.

See yourself as the customer sees you. To accomplish this, you will need to know how different customer segments view their experience with your operation. Each member’s experience is complex in a health club and has myriad touch-points. As operators we sometimes completely miss a touch point that is a major point of friction for our members. One MXM customer has discovered different loyalty drivers in different locations. For one set of very profitable customers, when scores for “Child Care” fall below 7.8, the increased risk of cancellation was greater than 200%.   In other locations it was the Equipment Selection scores that were the main driver of attrition and in yet another it was Availability of Staff For Assistance – all within the same ownership group. Seeing themselves as the customer sees them is what made these discoveries possible.

Wire the customer in to all decisions.   Member feedback needs to get to the employees who are responsible for delivering the experience. The feedback needs to be shared and used to make daily operational decisions with these customers. As data builds, its presentation must be engaging and immediately informative at every level of the organization. Member feedback should be enriched with member lifecycle (length of membership) and member engagement levels (average uses per week) in order to make impactful decisions that drive profitability.

Drive accountability at all levels. It MUST start with the top of your org chart and customer experience MUST be part of your strategy. Once this is clarified for your executive (or leadership) team, it becomes “mission-critical” to establish clear responsibilities, goals, and success metrics. You can then address any policies and monetary incentives that might need to be aligned with these metrics. But accountability includes the responsibility of training and coaching front lines and empowering them with the processes and workflows to systematically respond to, and use customer feedback.

Innovate and test to discover what will scale. You then prioritize customer experience “gaps” in order to design and test solutions that address the root cause of those gaps. This should be an inclusive process that solicits employee ideas for improvements and innovations. To add velocity to this learning, you need to understand what top-performing teams DO and how you can do the same. This allows you to be proactive and implement the very best cutting edge ideas before issues arise.

MXMetrics is a Medallia partner company focused on OCEM Methodology for the fitness industry and we work nearly 400 of the world’s best health clubs. We know what is working in practice and can speed your learning with real solutions. Click the link below for more.

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GRANDIOSE CX DELUSIONAL DISORDER (GCXDD)

In the business of customer experience management, we run into this disorder often. While difficult to cure, we have developed an effective process. In this article, we will explore what happens when it is left untreated.

1. What is Grandiose CX Delusional Disorder (GCXDD)?  

GCXDD is a kind of serious business related cultural illness called “organizational psychosis” in which an organization can’t tell what is real from what has been imagined by their marketing departments, motivational posters and website verbiage. These delusions usually involve the misrepresentation of customer perceptions or customer experiences. The reality is often either completely untrue or greatly exaggerated. This leaves the afflicted living in a world completely separated from reality.

Clear signs of fully developed GCXDD may include:

  • An over-inflated sense of worth, power, knowledge, or identity.
  • Company leaders/individuals whose opinions of the customer experience they deliver are unmoored from facts.
  • Statements like “world class” and “#1 in the industry” when referencing their customer experience.

The higher up the org chart, the worse the condition. This “Organizational Altitude” seems to be an accelerant to the severity of GCXDD. Close inspection also reveals GCXDD “enablers” who maintain roles in the organization by outwardly supporting leaderships’ delusional state. “Enablers” are not delusional themselves but to maintain power they keep afflicted leaders in a delusional state until they are able to source a new “host” with an updated resume.

2.  How can you tell if a leader, team, or an entire organization is afflicted with GCXDD? 

The symptoms include:

  • Ignoring customer complaints
  • Arguing away negative online reviews
  • Making statements such as “we deliver exceptional customer service” or “our people are our greatest asset” followed by actions that do violence to the customer experience and to employee engagement.
  • Leaders will also demonstrate a complete lack of curiosity about the reality of what the customer and front line staff feel and think.
  • Curiosity is replaced with a satisfaction of their own opinions about customer experience.

If GCXDD is left untreated it can lead to more serious problems, which, to the organization, seem to manifest independently although they are interrelated symptoms of GCXDD.  This is known as the “GCXDD Complex” and it includes:

  • Employee Disengagement Disease
  • Member Disloyalty Malady
  • The Very Deadly Revenue Shrinkage Syndrome

In the health club industry alone, we estimate that 7 out of every 10 health club owners is suffering from GCXDD. This subsequently affects more than a half million employees and nearly 30 million club members in the US alone.

3. What can I do?

First of all don’t be an enabler. If you are aware of an owner or a CEO with GCXDD we recommend a very strict 4-step intervention which has proven effective in clinical trials.  The method is as follows: 

  1. Seat yourself in a chair face to face with the afflicted opposite.
  2. Be sure the chairs are the same height and that your knees are almost touching. Although uncomfortable at first, this breaks down boundaries.
  3. Next, lean forward while simultaneously placing your left hand on the right side of his face and your right hand on the left side of his face.
  4. Now lean in and scream “wake the *&^% up!”

This can be done by anyone on the team or in the organization as long as they have enough relationship capital to get on the CEO’s schedule. Oh, it is also a good idea to have your resume updated as a precursor to the intervention in the instance that it doesn’t “take.”  In the instance that it does take, be prepared to start the process of understanding the gap between what your leaders want the customer experience to be and what it actually is.  Only when these gaps are clarified and accepted can healing really begin.

Come join us for the Club Solutions Leadership Retreat 2018!

Come join us for the Club Solutions Leadership Retreat 2018!

Moderated by Blair McHaney, President of Club Works, the Club Solutions Leadership Retreat is the most prestigious and rewarding event to attend in the industry!

The Club Solutions Leadership Retreat is an exclusive peer collaboration event that brings together 50 health club operators for two days of roundtable discussions, networking and unique experiences!

7 ways great companies use OCEM

As a health club operator and the vice president of strategic initiatives for a customer experience management software company, I know the importance of operational customer experience management (OCEM), which involves listening to customers and improving their experience by implementing changes based on that feedback. OCEM is not new to large enterprises that have big budgets along with a host of analysts and researchers as well as a driving desire to differentiate themselves from competition. But OCEM may be new—and a challenge—to smaller companies.

Executives at Fortune 500 companies know that customer loyalty is critical to their companies’ success, so they understand the importance of listening to those customers. Doing so helps to increase retention, and the recession has meant that the focus on retention is at a fever pitch. Executives see the importance of quantifying the return on investment of their loyalty initiatives, and this fosters even more investment in customer loyalty.

All of these OCEM initiatives have become commonplace at Fortune 500 companies. Not so for most companies in the fitness industry. Our industry needs to catch up. The fitness industry has pockets of companies with incredible customer loyalty and experience with OCEM, but the overall level of awareness and the desire to change is quite low. No matter what kind of fitness facility you run, you are a service business. You pay people to do things that are supposed to make the members’ experience better. OCEM systems tell you if that is working. They measure what, up until now, has been lost in the ether of the club.

The following are 7 ways that great companies use OCEM:

They set OCEM goals and measure progress. The key to OCEM is to talk to your members about customer experience, then measure it. As one company leader put it, “By the time poor customer experience shows up on your profit and loss, it’s too late.” Every gym owner should use a system to capture member feedback and benchmark against widely accepted methods for quantifying customer experience.

They embrace all feedback. The best companies do not get bogged down in dogma. Negative feedback as well as positive feedback are embraced and deeply investigated to recover customers and improve the future experience for all. Every individual piece of feedback matters.

They close the loop. When customers provide feedback, they get responses. Your members want to know that they have been heard. Your OCEM design should allow each of your locations to receive a stream of feedback at a pace that is easily manageable by the front line on a daily basis.

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They socialize feedback. These operators share with their staff the company’s scores for friendliness, cleanliness, overall experience or likelihood to repurchase. Staff discuss and dissect the numbers in meetings. Customer comments are used to support the desired culture. This is easy in the gym environment, and it is fun. I send comments to our entire staff about twice a week emphasizing what makes us different and thanking the staff for doing what we cannot do without them.

They nurture staff engagement. Part of the reason you need to socialize customer data is that it increases staff engagement. Business owners make sure all corners of their operations are aware of key loyalty metrics relative to goals and to peers in the system.

They know that customer experience leads. Downward trends in customer experience scores are the leading indicators for customer exodus. Awareness around customer experience allows one to see what has not been visible and to respond before it hits the profit and loss statement.

They never stop. These companies listen, respond thoughtfully, recover customers, make changes to delight and keep customers, set targets and measure the effectiveness of their efforts. This is how OCEM works and how companies differentiate by enchanting their customers. The playing field is wide open in the fitness industry. Operators with the right philosophy, the tenacity and the willingness to learn from enterprises more experienced and more profitable than ours will reap the greatest benefits.

Click below to learn about a software system that will improve the member experience.

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A conversation about customer loyalty

Loyalty: A Conversation With Gold’s Gym Hall of Fame Inductee Blair McHaney

This blog was first posted in:Expert Edge on August 25th, 2014 by Kimberly Warner-Cohen for the Customer Experience Report. It is an interview with Blair McHaney


Customer loyalty in the fitness industry tends toward either extreme, as clients generally either commit to their new routine or fall off and spend the remainder of the contract’s term wishing they could cancel. A well-structured onboarding process is key to a successful customer retention strategy, according to Blair McHaney, owner of two Gold’s Gym franchises in Central Washington and Director Emeritus of Gold’s Gym Franchisee Association. He is also the only franchisee in the organization’s history to  both win its three most important awards and be inducted into the Gold’s Gym Hall of Fame alongside The Incredible Hulk’s Lou Ferrigno and gym founder, Joe Gold.

Customer Experience Report caught up with McHaney during the 2014 Customer Service Experience Conference and discussed successful customer loyalty strategies, learning curves and the importance of a well-trained staff.

CER: Gold’s Gym in general and your gyms specifically have experienced significant long-term customer loyalty success. What success strategies could be applied across other industries?

Blair McHaney: The first thing is just this recognition that –let your front lines actually deliver the product. You’ve got to let them deliver on any loyalty promise. You can’t try to mandate every action or tactic that people take in order to grow loyalty. It doesn’t really matter if it’s a gym or hotel or anything else. When you run into policies consistently that are tough on the customer experience, that’s when you see that it’s usually the C-suite that’s gotten in the way of delivering a great customer experience. You want to build a violin? Here’s some two by fours and a hammer. But I think that’s the same anywhere. I don’t think it’s different in any organization.

CER: What common challenges have you experienced while driving customer service?

Blair McHaney: When you accept that customer experience management is going to be a business discipline, that means that there’s a lot of business process implications. You’re never going to be a great practitioner from Day One. So then your program has to evolve over time. And the more sophisticated you get, the deeper you dig on those things that are causing negative experience or those things that cause people to not be as open about identifying processes that should be improved. Everybody will find their way back to how they hire, onboard, train, develop and educate their people. If you’re gonna get excellent at this, excellence will be driven. You’ll always end up back at that point at some point.

CER: Has it been a trial and error or – ?

Blair McHaney: I don’t think it’s so much trial and error. I think it’s more strategy and urgency. Companies have some kind of strategy. They’ll say, “This is our strategy and this is towards our customers.” And then when they start to gain a tremendous amount, especially continuous customer feedback. I’m not talking about the market research once a year or twice a year. When you’re having this continuous customer feedback, you can see whether you’re executing the strategy or not. Then you find a spot where there’s a gap. We think we deliver whatever it might be, right? An inspiring environment or great hospitality. But, according to our customer, whatever we say is apparently just marketing blather and our customer is not feeling the same thing. So there’s a gap there. I don’t think it’s so much trial and error as is it urgency. We have a strategy that we’re trying to deploy. What’s most urgent? What’s the most urgent gap? We have to address that gap and as soon as you start to address that gap and dig in, at some point, it’s going to take you back to how your people are sourced, hired, trained, educated, onboarded, developed.

CER: When you spoke, you gave real world examples of employees taking on responsibility. How difficult was it getting them to the level you wanted them to be?

Blair McHaney: I think it’s important enough that we are investing now, and this is just in the few clubs, instead of having three hours of onboarding and about 12 hours of in-department training, it’s going to expand to about 50 of training. And onboarding is going to expand greatly. When I’m saying onboarding, I just take for granted you have to do all the HR crap, right? You have to sign the papers. I’m not even talking about that. I’m talking about cultural onboarding. I’m talking about understanding why the organization exists and what it’s aspirations are. All of that; the cultural onboarding. I think it’s equally important that all staff members have to be reboarded once a year. Because your onboarding is going to evolve. It’s going to get better. It’s going to get more and more aligned as your thinking gets more and more wrapped around customer experience. And then the people who were onboarded two years ago, it’s a different world. And they need to be reminded.

CER: Is the reboarding the same amount of time as the onboarding?

Blair McHaney: Yes.

CER: What customer loyalty innovations would you like to see in the future?

Blair McHaney: One thing that I really want to see in the technology is to build up the operational sides of it more. In other words, tracking – when you deploy an initiative, being able to track it. Having more of a social aspect in there, where your own teams are actually interacting with each other within the system. I think so much of the loyalty innovation is going to be business model innovation and how you think about your own customers. And I think that’s going to be informed a lot by your customer experience management system but I think it’s so much about how you digest that information and try to innovate around that.  There are all those things that I want to be able to track in the system.

3 Best Practices of CX Leaders

These are lessons that I learned during my 30+ years managing health clubs. Simple to identify but harder to implement. Three practices used by top Customer Experience Management practitioners that can help you begin to manage the experience at your business vs. just putting out fires as fast as they start. Here they are!

    1.  THEY LISTEN!

The true leaders of a positive customer experience actually listen to their customers AND their employees.  They have systems in place that allow them to listen to their customer & employee feedback (un-solicited!) and methods to analyze and use the data or information provided by those customers and employees.  When the customer or the employee points out a faulty policy or ‘friction-full’ procedure, they listen and work together to find a better way.

     2.  NO EGO!

It takes a unique leader to be able to openly listen to criticism and to make positive change as a result. Most leaders are set in their systems and operations and are unwilling to make changes even when their customers and employees are clearly telling them this isn’t working. A true leader knows they are only as strong as their weakest employee and operation. For example: at the next convention or out of town meeting, listen for this: “My people just can’t survive without me. I need to get back! Things are falling apart.”  This company is NOT a leader in the customer experience world.  True customer experience leaders don’t wait for the bottom line to drop before making change.

     3.  Have a Customer Experience Mission!

EVERY employee must know his or her role and expectations in the customer experience strategy. The customer experience mission statement is clearly and effectively communicated to every single employee, every single day. Customer experience is the first thing and the last thing talked about when hiring a new employee. The new hire KNOWS and UNDERSTANDS the company’s commitment and passion for customer experience from day one. And they also are clear on what role they play in that experience. The true leaders of customer experience continually hire and train around their customer experience strategy.