YOUR FIRED!

I have updated this blog; in my research I found over 1,000 customers were fired that called customer service over 90 times a month. That number is still high, that's two times a day for 30 days.

This is a reply blog for a conversation we had in class. The question was asked, should you fire a customer? One person in particular felt a company should not fire a customer unless the customer harmed someone. While watching CNN last night I was surprised to see Sprint has decided to fire over 1,000 customers for complaining too much. The letter is posted in the first link below; the news article is second; I tried to figure out how to link the website to words but couldn't. Anyway

Why were these customers fired; because Sprint felt they were part of the reason other customers were experiencing long hold times. The customers that were fired called up to 90 times a month complaining about their billing and technical problems.

These customers were wasting the customer service representative’s time and other customer’s time by constantly complaining about the service, creating longer hold times. Hooray for Sprint!

Oh and this made me laugh. The customers that were fired were told to call Customer Service if they have any questions regarding the transfer of their number to another service or if they had questions regarding their final bill. Genius!

http://consumerist.com/consumer/exclusives/sprint-customers-terminated-for-complaining-too-much-were-scamming-sprint-for-free-service-277026.php):

http://gizmodo.com/gadgets/announcements/sprint-dumps-needy-customers-275374.php

http://articles.moneycentral.msn.com/Investing/Extra/SprintDumpingCustomers.aspx

Declining profits do not necessarily reflect an unsuccessful compay; sometimes the company just needs a new image. Take for instance, NovaRede, this company started off good by introducing the concept of “chain retail banks, consistent customer service, and innovative products,” but they needed more to reach their full potential. After an evaluation of their customers, NovaRede recognized many of them were only set up for one of their services; the remainder of the services were thru competitors. To turn this around, NovaRede began to focus their operation to appeal to customers on a higher level; by implementing an “advanced ATM technology, an innovative branch layout, incentives for employees to help customers make transactions at machines, and incentives for customers.” This strategy of expanding the business worked and NovaRede’s profits began to rise.
Many companies today also use this approach, especially banks. Bank of America offers all the services you would want from a bank; checking, savings, online banking, loans, mortgages, credit cards (with incentives.) The incentives offered include credit cards that offer cash back, airline miles, hotel points; low interest rates on loans and mortgages, etc. These incentives make it appealing and convenient for customer to get all their banking needs in one place.

Jack Welch, then CEO of GE, used GE’s annual management meeting in 1992 to expose those who where not in attendance due to violation of the organizations values. His exact comments were, “One was removed for the numbers, and four were asked to go because they didn’t practice our values.” Should employees like this be exposed to the entire company when situations like this occur? I struggled with this question for a moment. At first I thought it was very unprofessional of this manger to call out ex-employees without them there to defend themselves, but then I had to think of the impact this message had on employees. Sometimes words are not enough for people fully understand the significance of company policies; sometimes it takes something as drastic as firing an employee who has violated the values of the company in order to create an example for others. Values are important to the company and its image, when employees violate these values, consequences are sure to follow; which can include being an example for “what not to do in business.”

http://en.wikipedia.org/wiki/Jack_Welch

http://www.rhsmith.umd.edu/smithbusiness/fall2006/leadersdigest_4.html

Mandatory Review

Should reminder of core values be done frequently? The book says no, but I say yes. The values of the company run every aspect of the company; from the way employees look at customer, customers look at employees, employees look at employees, employees look at themselves; etc. Core values are a reminder of what the company expects from their employees and many times employees forget this type of information; therefore they should be reminded frequently. How frequently you ask? At least twice a year.
If this sounds like too much let me remind you of a company called Enron. Enron’s core values included words such as “respect, integrity, and excellence.” Could a simple email from the company, short meeting, or overview of core values have prevented this tragedy from occurring? I’m not too sure, but if the company had reviewed the company core values with all employees frequently it would have made the ones involved at least think about what they were doing. Now when you log onto the website for Enron all that’s left is bankruptcy notices, notices of payment to creditors and a name tarnished forever.

http://www.prague-tribune.cz/2005/11/14.htm

Values are Meaningful

In order for values to mean something, they must first be implemented within the organization. Anyone can hang a plaque on the wall listing the values of the company but until these values are practiced and held to a high regard they are nothing more than "wall art."
Although the company Cisco Systems had some hardships when the collapse of the market for telecom equipment occurred; they were able to recover by making adjustments to the company's strategy which relied on the values set early in the company. Management realized that the value system set up in the early stages of the company's development contributed to the success; therefore it was important to go back to these values.
John Morgridge, the company’s chairman, said: “The key to the values is more how they are practiced than what they say. Current key words and phrases (around the company) are customer success, drive change, open communication, fun, empowerment, market transitions, no tech religion, frugality, giving back, stretch goals, and teamwork. Some go back almost to the start and some reflect more what we have been doing all along.
This statement means that a company can become relaxed in its values, only touching on those that seem to mean the most and/or are easy to implement. When a company experiences hardships they should reevaluate what made them successful in the beginning and review these values to see where they need improvements. Company values should be more than “wall art” they should be art that is appreciated and respected.

Values and Decentralization

When people are held personally responsible in the decision making process they are more likely to make a more ethical, well thought out plan of action. Decentralization in an organization creates an environment of value, and is important for the success of a company. Decentralization involves a non-hierarchical management structure which means employees are able to make quick decisions based on what they feel will benefit the company. This type of management structure proved to be successful when Jim Burke, the CEO of Johnson and Johnson, was out of the country when a product containing cyanide killed seven customers. The Johnson and Johnson team was able to make a quick decision to recall $125 million worth of products off the shelf to protect the customer and the company’s image from being tarnished. This decision was costly to the company, but proved to be successful in the long run because it showed compassion for the customer as well as the value system of the company. Companies are still leaning from this type of management strategy; in fact it is referred to as “the gold standard in crisis control.”

http://money.cnn.com/magazines/fortune/fortune_archive/2007/05/28/100033741/index.htm

http://www.jnj.com/home.htm

Incentives for Employees

Do incentives really create better employees, or do incentives create greedy employees? I believe incentives can motivate employees to an extent, but after a while the employee will EXPECT more incentives in order to do the job they were hired to do. One article I read called, “Equity, the unifying factor - equal treatment and privileges of executives and employees,” seems to agree with my theory of incentives creating greed. In this article the author talks about corporations focusing less on individual incentives and more on meeting corporate goals.
Another article I found called, “Keeping Workers,” lists one way of motivating workers is to offer incentives. In my experience with incentives, the offer of extra money for a job well done is met with great effort by an employee to achieve task at hand; which is usually part of their job duties anyways. Once the task is complete and there is not an incentive to go above and beyond normal tasks, the employee becomes complacent and it takes more incentives to get them motivated again.
In summary, if an employee works hard, on a consistent basis, to achieve the goals of an organization, than I fully support incentives. However, if an employee is only driven by incentives, it’s probably time to replace that employee.

http://findarticles.com/p/articles/mi_m3495/is_n2_v37/ai_12070747/pg_2

http://www.sasknetwork.ca/html/Employers/workplace/rewardsandincentives.htm