Why Many Companies Cannot Build Great Brands

Many companies are not able to build great brands.

The reason is that they treat their employees as costs, rather than as assets.

Let me explain.

PEOPLE AS COST OR ASSETS

The aim in business is to manage costs and to maximise the value of assets.

So, how do companies treat their people? Are they costs or assets?

I am continually exposed to companies that say they want to build great brands through the customer experience. But then they treat their people as costs to be minimised, rather than assets to be developed and increased in value.

So, when it’s time to “trim costs”, the people side of the business gets cut. Training gets cut. Cultural initiatives are “scaled down”.

 

AN EXAMPLE OF A COMPANY THAT TREATS ITS PEOPLE AS ASSETS

If the customer experience, service culture and people performance are truly valued as assets, then when things get tough in organisations, these assets should be preserved and invested in.

I was listening to a radio interview with the CEO of a major hospitality brand in Malaysia. The interviewer astutely pointed out the relatively low level of profits based on the gross revenue figures. The CEO was asked what he was going to do about this.

His reply was that he was going to work on his people. He would conduct more training so that they knew more about the products and provide better customer experiences.

Wow! This is so different to what most CEOs would say.

This CEO understands that service creates sales. We are here for our customers. Happy customers buy more, they tell others and they come back.

If this CEO treated employees as costs, he would have cut staff numbers to reduce staff costs (salaries, benefits, training etc) to create a short term increase in the bottom line. But customers abide by the golden rule – “He or she who has the gold, rules”. Eventually, the cuts would be felt in terms of lost business.

 

AN EXAMPLE OF A COMPANY THAT TREATS ITS PEOPLE AS COST

I was talking to a manager of a major company operating in Malaysia. It soon became clear that this company treated its people as costs.

The manager was lamenting what his company was doing. The CEO of this organisation had called (once again) for cost cuts across the organisation. This meant there would be more staff cuts. The only problem is that staff cuts were not being accompanied by technology improvements to lighten the load of employees. In fact, employees were already under-resourced, stressed to the max while their drowned in their workloads.

This company’s management publicly pays lip service to “people are our most important asset” – and then they drive them into ground with overwork!

This story is being played out over and over again.

 

THE IMPACT OF TREATING STAFF AS COSTS

So, what happens?

Customer service staff suffer. And the customer service levels suffer as staff try to do more with less.

This is a good reason for senior leaders come to the front-line to serve customers on a regular basis. They will soon form an empathy for the needs of customers and the needs of staff. That’s the subject of another article.

 

DELIVERY OF GREAT CUSTOMER EXPERIENCES COSTS TIME AND MONEY

Just imagine if Mickey Mouse came to work with a bad temper one day!

Mickey, rather, the people who play Mickey, know that Disney’s brand promise is fun and entertainment, and he delivers, day in, day out.

This doesn’t happen by accident.

Rather, it happens because great companies like Disney spend an enormous amount of time and resources to engage and train employees to deliver on the brand promise. They measure regularly for the customer experience. They have ongoing internal communication to reinforce the customer experience and to build the culture. Their HR is aligned to hire people who fit the brand.

 

INVEST MORE IN YOUR ASSETS TO BUILD YOUR BUSINESS

My observation is that the vast majority of companies have a long way to go before they can create great service brands.

The simple reason is that they are cost-focused rather than customer-focused. It’s easier to trim costs than to support the delivery of great customer experiences and to build service cultures.

 

IN SUMMARY – 3 TIPS

So here are three simple messages (just in case it has not been obvious so far!)

• We are here for our customers. Our customers grow our business.
• Our employees are here for our customers. Treat employees as assets. Engage them. Train them. Build your service culture with them.
• And understand that growing our business through our people costs money. If the customer experience is a key strategy for your organisation, devote the time and resources to help you to get there.

 

Thank you for investing your time to read this article. Please feel free to share it with others.

Until next time.

 

Written by George Aveling, CEO TACK TMI Malaysia
Original article: here

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