Right Attitudes

Ideas for Impact

MBA in a Nutshell

From the Inside Out: How Empowering Your Employees Builds Customer Loyalty

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At a time when apathy and distrust are so endemic in many organizations, some companies have nurtured employee loyalty to create customer loyalty flourish. The following case studies will substantiate the cultivation of a positive work environment that prioritizes employee recognition and support invariably results in exceptional customer service.

The Nordstrom Way: Enabling Employees to Have the Freedom and Vision to Become Self-Directing

Nordstrom’s founders created a culture that prioritized a “worshipful relationship” with its luxury department store customers and empowered employees to do everything they could to please them. The Nordstrom Handbook emphasizes outstanding customer service and encourages employees to set high personal and professional goals, expressing confidence in their abilities. The company’s Rule 1 reads: “Use good judgment in all situations. There will be no additional rules. Please feel free to ask your department manager, store manager, or division manager any question at any time.” Nordstrom’s success is a testament to empowering employees and supporting policies prioritizing exceptional customer service.

Flying the Fun Skies at Southwest Airlines: Giving Employees the Freedom to Deliver a Great Brand Experience

Southwest Airlines achieved great success early on due to its committed and motivated workforce. Founder Herb Kelleher recognized the importance of prioritizing employee satisfaction to create a culture of caring for one another and providing excellent customer service. Kelleher famously said, “The business of business is people—yesterday, today, and forever. If the employees aren’t satisfied, they won’t provide the product we need.”

To create a positive work environment, Southwest Airlines encouraged fun among its employees, setting it apart from other airlines that were considered dull and unappealing. Celebrating employees and their families is deeply ingrained in Southwest Airlines’ culture, and it is evident in the prominent display of pictures capturing these special moments throughout their office spaces. This people-centric culture helped the company attract and retain talented workers passionate about their jobs and provide top-notch customer service, which made flying with the airline a fun experience. Despite the potential cost savings, Kelleher remained committed to celebrating employees with parties, banquets, gifts, birthday cards, and outings, citing the value of having the fewest customer complaints in the industry.

Beyond the Call of Duty: Ladies and Gentlemen Serving Ladies and Gentlemen at Ritz-Carlton

The Ritz Carlton is renowned for its exceptional customer service, with the empowerment of employees being a critical factor in their approach. The company’s philosophy of “Ladies and Gentlemen Taking Care of Ladies and Gentlemen” highlights the importance of treating customers and employees with respect and dignity. Regardless of their rank and title, employees can spend up to $2,000 per day per guest without seeking supervisor approval to solve problems and deliver personalized and unforgettable guest experiences. This approach may seem costly, but it empowers employees to use their judgment to create memorable and personal experiences for guests. One of my friends enjoyed staying at a Ritz-Carlton hotel a few months ago, where he ordered a burger and a milkshake. Unfortunately, the hotel did not offer milkshakes, so he settled for a glass of water. However, to his amazement, the waitress surprised him with a milkshake to accompany his burger. She went the extra mile without being prompted by scouring the kitchen for milk, ice cream, and cold milk to create the shake.

Idea for Impact: Empowering Employees is a Strategic Approach That Yields Significant Benefits

Empowering employees goes beyond providing the necessary tools and training; it fosters a culture of trust, autonomy, and ownership.

How you treat your employees directly impacts how they treat your customers. When you prioritize making your staff feel appreciated and supported, they are more likely to provide exceptional customer service. A positive work environment can foster innovation and creativity within your organization while attracting and retaining top talent.

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The Emotional Edge: Elevating Your Marketing Messaging

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The Emotional Edge: Elevating Your Marketing Messaging

Messaging isn’t only about the product.

It isn’t solely about the problem.

It isn’t even just about the consequences of not solving that problem.

It’s about the emotional pain that you alleviate.

Good marketers highlight the benefits, value, or solutions that their product or service can offer. The best marketers often leverage emotional triggers to establish a deeper connection with consumers.

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Sock Success: How THORLO’s Customer Focus Led to Big Wins

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Jim Throneburg made socks. Innovative socks. “Activity-specific” padded socks. THORLO, his family-owned sock manufacturing company based in Statesville, North Carolina, is known for its innovative padded socks for various activities such as running, hiking, walking, skiing, and more.

Throneburg’s innovation didn’t come from a flash of genius but from a personal experience. In 1953, Throneburg founded THORLO after seeing his father suffer from foot pain caused by poor-quality socks. He started selling socks out of the trunk of his car. As the quality of the socks gained recognition, the company began to expand. In the 1960s, the product line expanded to include socks for hiking and mountaineering, and in the 1970s, THORLO developed a specialized padding system that could be customized for different activities.

In the late 1970s, Throneburg realized that as the function of shoes changed, so should the design of the socks that complemented them. Drawing from his experience at a weight-loss clinic where he needed thicker-soled socks, he transformed Throneburg Hosiery Mill from a commodity business into an innovative sock manufacturer that became THORLO. He invested in new designs, yarns, and technology that he had perfected, making padded socks for the military. The company has since created dozens of sport-specific sock varieties.

THORLO’s R&D happens where the foot meets the sock and the shoe, addressing everyday problems ordinary people face. Throneburg developed a ladies’ rolltop sock for golf and tennis after a woman golfer complained about her socks slipping down. When a man with a rare foot condition found relief from THORLO’s socks and asked if Throneburg could make socks for his young daughters, Throneburg forwarded the request to product development.

Throneburg held more than 25 patents in the United States and internationally, and he was one of the most prolific inventors in the sock, insole, and shoe industries. His success demonstrated that innovation does not require a flashy tech startup or a billion-dollar budget.

Idea for Impact: Innovation could happen anywhere and at any time. It was not just about new products or cutting-edge technologies but about seeing things differently and understanding customers’wants and needs.

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After Action Reviews: The Heartbeat of Every Learning Organization

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The After Action Review (AAR) is a formal group reflection process used by the military and other organizations to analyze critical decisions or moves.

At its core, the AAR seeks to answer four questions: What was planned, what actually happened, why did it happen, and how can we do better next time?

The focus isn’t on grading success or failure but on identifying weaknesses that need improvement and strengths that should be sustained. The knowledge gained from the AAR can then be shared with others who’re planning, developing, implementing, and evaluating similar efforts.

Conducted in an open and honest climate, the AAR involves candid discussions of actual performance results compared to objectives. It requires input and perspectives from all stakeholders involved in the project or activity. The goal is to ensure everybody feels part of the solution, not the problem.

AARs are a powerful tool for continuous improvement that enables organizational learning through reinforcing personal and organizational accountability and continuous assessment of performance successes and failures. They’re an excellent way to identify best practices (what should be spread) and errors (what shouldn’t be repeated.)

The wisest and smartest people and businesses can reflect ex post facto. As the saying goes, “He that will not reflect is a ruined man.”

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Decoy Effect: The Sneaky Sales Trick That Turns Shoppers into Spenders

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Imagine yourself at the movie theater, deciding whether to buy a small popcorn for $5 or a large popcorn for $8. You’re wondering if the extra popcorn is worth the extra money, so you consider the small size. Suddenly, the cashier offers you medium popcorn for $7.50, and you buy it instead of the small one.

However, the medium popcorn is a lure—a true distraction. By introducing it, the theater has made the large popcorn seem like a better value and the small popcorn seem less attractive. This is a classic marketing strategy known as the Decoy Effect, which aims to influence your decision-making.

In essence, the Decoy Effect presents you with two options and then adds a third option designed to make one of the original options more appealing. This can sway your decision-making and lead you to choose the more expensive option.

Studies have shown that framing can influence our decisions, as a well-designed decoy can shift opinions by up to 40%. One well-known example of the decoy effect in action is from The Economist, the influential weekly international news and business publication. Behavioral economist Dan Ariely’s book Predictably Irrational (2008) describes how the magazine offered a digital subscription for $59, a print subscription for $125, and a combined print and online subscription for the same price of $125. The print-only subscription was clearly a decoy, designed to make the combined subscription seem like a better value, and it worked; the presence of the decoy significantly increased the uptake of the combined subscription.

While psychologists are still debating the exact reasons for this cognitive bias, one theory suggests that the decoy provides a straightforward justification for a decision that might otherwise seem arbitrary.

Idea for Impact: If you run a business, you too can use the decoy effect to steer consumers towards certain purchasing decisions that benefit your bottom line. By strategically adding a decoy product to your offerings, you can provide perceived value for your customers while boosting your profits.

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The #1 Tip for New Managers to Succeed

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New managers are under pressure. Most managers are underprepared for the transition into new roles—and undersupported during them. In fact, the revolving door is turning more swiftly as companies are seeking quick results. New managers must immediately tackle challenges and demonstrate their competencies instead of having a grace period to find their footing and mull changes.

When taking on a new management position, adaptability to the unique culture and ways of doing things is the key to success. You must quickly throw yourself into the work and learn who’s who, who does what, and how your company operates.

Idea for Impact: Balance the pressure to show results quickly, understanding what significant changes are needed. First, talk to your constituencies (internal and external customers, competitors, leaders, employees) and lay out a road plan for the next three months, one year, and three years. Manage expectations and don’t overcommit.

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These are the Two Best Employee Engagement Questions

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Engaged employees are more likely to be effective, stay with your company, and nurture a favorable corporate culture. To gauge employee engagement levels regularly, run a pulse survey and ask these two questions:

  1. To what degree are you proactively engaged in improving the tasks you’re responsible for? Does your workplace actively seek your ideas to make those improvements?
  2. To what degree do the processes that you are working with enable you to be highly successful in your job?

Seek ideas meaningful for improvements from people on the job. Demonstrate commitment to taking significant action and follow through.

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How to … Plan in a Time of Uncertainty

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In periods of uncertainty and ambiguity, move away from annual plans and focus on the next three months. Reflect on the unpredictability of the future and stay on your toes by forging plans for unexpected scenarios so you won’t be caught flat-footed when that time comes.

Establish “trigger points” and “accelerate, maintain, or terminate criteria” in advance and keep an eye on key indicators to “wait and see” or “stay the course” should one of your planned-for scenarios materialize.

Idea for Impact: When the horizon is much shorter, operate with agility and allocate your resources in real time.

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Be Smart by Not Being Stupid

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No superhuman ability is usually required to dodge the many foolish choices to which we’re prone. A few basic rules are all that’s needed to shield you, if not from all errors, from silly errors.

Charlie Munger often emphasizes that minimizing mistakes may be one of the least appreciated tricks in successful investing. He has reputedly credited much of Berkshire Hathaway’s success to consistently avoiding stupidity. “It is remarkable how much long-term advantage we have gotten by trying to be consistently not stupid instead of trying to be very intelligent.” And, “I think part of the popularity of Berkshire Hathaway is that we look like people who have found a trick. It’s not brilliance. It’s just avoiding stupidity.” They’ve avoided investing in situations they don’t understand or summon experience.

As a policy, avoiding stupidity in investing shouldn’t mean avoiding risk wholly; instead, it’s taking on risk only when there’s a fair chance that you’ll be adequately rewarded for assuming that risk.

Idea for Impact: Tune out stupidity. Becoming successful in life isn’t always about what you do but what you don’t do. In other words, improving decision quality is often more about decreasing your chances of failure than increasing your chances of success.

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Do Your Employees Feel Safe Enough to Tell You the Truth?

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Take any corporate scandal or the Challenger and Columbia disasters, and you’ll find lower-ranking voices that tried to be heard within these organizations to prevent or minimize the consequences of the excesses or the accidents.

Some leaders are too isolated from reality and establish an “all’s-good” guise whereby anything other than affirmative becomes an undesirable—unwelcome even—answer to a performance-related question. Such leaders foster a “good-news culture,” where any truth-teller or devil’s advocate is quickly dismissed. Queries such as the cursory “Is everything okay?” elicit information-free, non-answers like “yes” and “great!”

When leaders are disconnected from reality, they become incontestably right. Employees know the rule of the game is to say what’s safe to say. To not tell the truth. To tell the leader just what she wants to hear. Employees would instead go with the flow rather than speak truth to power.

Consequently, business pressures often lead to shortcuts that go overlooked. Risk is normalized. Leaders who cannot tap into the truth get blindsided when the problems blow up because they didn’t nip the problems in the bud. Leaders have only themselves to blame when things go wrong.

Idea for Impact: Insightful leadership isn’t about the privilege of position but the privilege of information flowing upwards. Wise leaders dare to seek information they don’t want to hear. They know how to ask the right questions, look for revealing details, and set up a culture of openness that makes it easy for employees to tell the truth.

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