Executive Interviews: Interview with Charles Spinosa on Strategy Execution
September 2008 - By Dr. Nagendra V Chowdary

Charles Spinosa
Charles Spinosa,
Group Director Vision Consulting.

Realizing that most retail bank customers worry that the bank will lure them in with promotional rates and then start gouging themwith fees a few months later, the Pacific Trust Bank CEO, Hans Ganz has a sign in each branch promising to pay any customer $50 to leave after sixmonths if the customer is unhappy for any reason. There is a condition. The customer has to come in and say why he or she is unhappy. The promise and the condition both drive a sense of shared value and of conversation. Everyone who deals with a customer asks if he or she is happy with the service, and customers for their part give serious answers.

Lloyds TSB grew from approximately 1% market share to 10% market share in the highly competitive UK mortgage market with a similar conditional promise to brokers. "We will provide you with a mortgage decision in three hours provided you give us a fair representation of your business." Conditional promises take care of anxieties and get conversation going.

2. Establish and Publish a Distinctive and Widely Understood Value and Purpose Statement: Most value statements waste the paper they appear on. Leaders who build a cultural advantage think about their values and purposes incessantly in order to distill the purpose and values into a clear statement that distinguishes them from their competitors. Harold Schwartz of Starbucks is brilliant at this. You might think Starbuck's baristas primarily provide people with coffee. Harold Schwartz does not think so. Their purpose is to provide customers with a daily uplifting experience. Coffee is only a means. There are then four imperatives (values) that Starbucks baristas live by: a) be welcoming, b) be genuine, c) be considerate, d) be involved.
3. Deploy a Signature Practice that draws everyone inside the company to express the company's top value in action while engaging in the practice. Imagine the power of finance, sales, engineering, and operational experts bonding over a single practice that shows the company's top value.
4. Simple Measures: Simple measures are already part of promisebased strategy execution's tool-kit for execution. The new culture itself takes root if employees are given a small number of key measures. The John Lewis is exemplary. Every customer facing employee is measured on her ABCs by both her manager and mystery shoppers. What are the ABCs?

   Approach: Every customer who comes to the store should be discretely acknowledged within two minutes of entrance, not with American-like hardy greetings, a British nod or smile will do.

   Build: John Lewis hires product mavens who love telling customers about the product and finding just the right product to suit the customer's need. If the customer comes to purchase wine glasses, the maven will learn the typical occasion, any special occasions, describe what different glasses do for the table and the wine and find the one that perfectly suits the purposes of the customer, even if it means a lower-priced sale.

   Close: After the build, the John Lewis salesperson explicitly asks the customer if he or she would like to purchase the product today. The close is part of the service. After the John Lewis employee has shown so much expertise in describing the product, the customer expects the employee to say when it is time to make a purchase. Employees guide themselves and others with their ABC standards. They are a simple mantra.

5. Collect and Celebrate Legendary Stories: Legendary stories are simple stories of employees expressing the company's values in an out-of-the-ordinary way. They can be simple: At John Lewis, a customer had purchased more than she could fit in the boot of the car. The store had closed, and she was stymied. An employee sized up the situation immediately, took off his silk tie, and tied the boot shut. At Umpqua bank, an elderly man who had been a customer for years came in one autumn day asking that the bank stop payment on a check. He had purchased a cord of wood for burning in his wood stove over the winter, but the logs would not fit in the stove. The clerk told him that the check had already been cashed, but if the customer could wait until the weekend, his problem would be solved. That weekend, a team of Umpqua bank clerks arrived at the customer's house and cut the wood to the right size. The heroes of these stories are culture heroes. To perpetuate the culture, businesses need to celebrate them as such. Ritz Carlton, Umpqua Bank, and other cultural leaders celebrate these heroes at a celebration modeled after the Academy Awards. John Lewis used to create film adaptations of the stories and hold a Cannes-like celebration where everyone saw the videos. Without celebration of the extraordinary, the ordinary dies.
6. Make the Chief Executive the Chief Cultural Experience Officer: The responsibility of standing for what customers, shareholders, and employees care about in the business is too big a responsibility to delegate. If the Chief Executive does not take the responsibility to live and express the values of the business everyday, including taking responsibility when something goes wrong, then the organization cannot compete on culture. The Chief Executive will be a constant distraction. Does she really stand for the culture or is it the invention of her delegate? When people are going to engage in heroic efforts for the sake of the culture, they cannot be wondering if the culture is real. In summary, strategy implementation requires culture change. Since that is the case, why not use the occasion to develop a cultural competitive advantage along with the one embedded in the core strategy?

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