Transparency is something that a lot of businesses struggle with–especially with their customers. However, in today’s world, data and technology make it easier than ever to give customers what they want. In the process, this can also serve to drive customer happiness.
It’s a theme throughout my book, Blue Goldfish. The customer experience begins with leveraging data and technology that is available to you. Consider the following example: The year was 1981—the same year the first Space Shuttle rocketed from the Florida coast. A few weeks after STS-1 launched in April a sixteen-year-old Michael Dell, then a high school student, took a summer job selling subscriptions for The Houston Post.
Burgers, hot dogs, fries, and milkshakes. It’s the quintessential backyard American food and a staple of Americana fast food. But these establishment are a dime a dozen, aren’t they? Sure, there are the Chick-fil-A’s of the world. But isn’t it nearly impossible to carve out your own identity in this sea of sameness?
Pal’s Sudden Service, a double drive-thru fast food restaurant chain with 26 locations in Tennessee and Virginia, is certainly up for the challenge. Pal’s believe that an emphasis on its people, speed, customer service, and quality is what truly sets them apart.
Here are five quick facts about Pal’s Sudden Service that demonstrate that the proof is really in the pudding (or their milkshakes for that matter):
- An astonishingly low turnover rate with the at the assistant manager level coming in at 1.4 percent, the hourly staff at 32 percent, and has only lost seven general managers in 33 years. In comparison, most fast food chains have an average turnover rate between 50-150 percent with management and hourly employees aggregated together.
- An average of 18 seconds at the drive-up window, and an average of 12 seconds at the pickup window to receive the order for a grand total of 30 seconds. That’s four times faster than the second-fastest quick-serve restaurant in the country.
- Pal’s makes a mistake only once in every 3,600 orders. That’s nearly ten times better the the second most accurate fast food chain, Chick-fil-A.
- 1,100-square-foot buildings accruing right around $2 million per year in sales. That’s just over $1,818 per square foot. The iconic Shake Shack and Chipotle restaurant chains come in at $387 and $250 in comparison, respectively. Remember, it’s not how high your sales are, it’s how much you bring home to the bank.
- One of two restaurant chains that has ever won the Malcolm Baldrige National Quality Award. This prestigious award caused Pal’s to create the Business Excellence Institute (BEI) as a way to share best business practices with others. The other restaurant winner of the Baldrige award is a BEI client, Mighty Fine Burger.
By now you’re probably very impressed but this all begs the question, how does Pal’s do it?
Here are seven differentiators that Pal’s has instituted that you can learn from:
- An emphasis on great people – Pal’s has developed and fine-tuned a screening system to evaluate candidates that includes a 60-point psychometric survey, based on the attitudes and attributes of Pal’s star performers, that does an unprecedented job of predicting who is most likely to succeed.
- Top-notch training – Once Pal’s selects its candidates, they put employees through 120 hours of training before they are allowed to work on their own, and must be certified in each of the specific jobs they do. Pal’s also has assembled a Master Reading List for all the leaders in the company and it includes 21 books that must be read. Every two weeks, the CEO, Thom Crosby, invites five managers from different locations to discuss one of the books on the Master Reading List.
- Ongoing training – Pal’s believes that all leaders are trainers and educators. They also believe that people educate by their attitudes, their behaviors, and by their focus. At Pal’s, every leader needs to have a coaching and training target every single day. Management and leadership asks their employees at random, “What’s your target for today?” Every single employee has to have a person and a topic every single day.
- Technology – Pal’s has a proprietary “training tracker” software system that manages all employees. The software quizzes employees at random every single day whether it’s their first day on the job or they’ve been there for 10 years. The software goes through the basics, the most critical parts of the operations with employees. Management then conducts an observation to make sure the employees are still adhering to the standard 100% without exceptions.
- Development of leaders – Employees who have scored 100 percent on four re-certifications are eligible to become coaches within their restaurants and help their colleagues consistently develop and adhere to their standards. According to the CEO, “We are looking to get people to this mastery level.”
- A commitment to staying top of mind – Pal’s recognizes that all restaurants are chosen from a defined mental rolodex by customers. and believe that customers only ever think about 2-10 establishments. This is the reason why Pal’s created their website to have a unique and inspiring thought of the day, local movie theatre showtimes, and the CEO answers every single question through the contact form. This is what keeps people coming back to Pal’s site and provides a useful service to the communities Pal’s serves.
- A focus on culture – According to the CEO, “Sometimes I get that itch that maybe it’s time to step up and expand faster. But we want to make sure that we hand off all the cultural pieces to each store. I see operations that outgrow their cultures. They can’t pass on their culture so they go from a really great concept with great people to weaker and weaker operations and people who don’t understand the origin of the culture.”
What’s preventing you from instituting world class principles just like Pal’s? Does your business do anything similar? Leave a comment below.
Today’s Lagniappe (a little something extra thrown in for good measure) – Be sure to check out this incredible overview about living your mission from the president of Pal’s BEI, David McClaskey.
There’s no doubt about it– not having a good method in place for collecting payments can often lead to friction. Luckily there are many ways that companies can reduce friction through payment. One such was that companies reduce friction is through subscription programs. These programs often provide convenience to customers at a lower price point than they’d pay purchasing frequently used items one at a time.
Our favorite example is Dollar Shave Club. Not only have they done an excellent job of marketing via youTube, but they’ve also developed into a business with a 615 million dollar valuation.
Have you recently found yourself wondering what, exactly, a Blue Goldfish is? A Blue Goldfish is any time a business leverages technology, data, and analytics to do a “little something extra” to improve the experience for the customer. In theory, Blue Goldfish is a great concept. These days, the world around us seems to be ruled by technology so the ease with which we can make Blue Goldfish happen would appear to sway in our favor. There are smartphones, computers, and easy pay technology to name a few.
Helping a customer do business with you without friction is almost a sure way to increase revenues. When you’re a staple of quick service like Starbucks, time is money.
Waiting for customers to find payment methods can make the difference between a reasonable line and one that causes customers to turn the other way and leave.
The following is an excerpt from the book, Blue Goldfish:
We are entering a new era driven by technology. A time that MIT’s Erik Brynjolfsson and Andrew McAfee call the Second Machine Age. We are now on the cusp of a time where business can start to leverage the advances in computer processing, artificial intelligence and networked communication. An example of this is Waze. The app allows users to access maps and driving directions. It also provides up to date conditions, allowing the driver to navigate swiftly and safely. It can do this because each road map has been scanned into the database, but also because every cell phone transmitting from every car will reveal where the traffic jams are.
It took several decades for earlier breakthrough technologies, such as the steam engine or electricity, to reach the point of ubiquity and flexible application in the first machine age. Once they did, both fundamentally changed the way people lived and businesses operated. Information technology and digital communication are now just reaching that same inflection point.
The big winners in this new era will be consumers, who will be able to buy a wider range of higher-quality goods and services at lower prices. The other winners will be those who create and finance the new machines or figure out how best to use them to gain competitive advantage. Great wealth will be created in the process.
It’s Been a Journey
We didn’t get to this inflection point without innovation over the last 50+ years. Let’s look at some of the major breakthroughs over that time. Here is a slideshare on the journey:
1961 – The silicon chip was invented by two American electrical engineers, Jack Kilby and Robert Noyce. Their creation revolutionized and miniaturized technology and paved the way for the development of the modern computer. Until the chip was invented, most electrical devices were constructed using bulky, power-hungry vacuum tube technology. The development of transistors partially solved the problem but these still had to be wired to circuit boards. Kilby and Noyce hit on the solution almost simultaneously, combining separate components in an integrated circuit made of a semiconductor material. Intel founder Noyce, working in Palo Alto, California, favored silicon and can thus be credited as the man who put the silicon in “Silicon Valley.
1964 – Roger Easton begins experiments that lead to the development of GPS (global positioning system), a ubiquitous feature of modern life. What began as a way of tracking satellites like Sputnik became a way for satellites to track us here on the surface of Earth.
1967 – Graduate student James Goodnight joins a project at North Carolina State University. The goal was to create a statistical analysis system (SAS) used by agricultural departments at colleges and universities. In 1976, SAS Institute becomes an independent, private business led by Goodnight.
1969 – Neil Armstrong becomes the first person to step onto the lunar surface of the moon.
ARPANET (Advanced Research Projects Agency Network) headed by J.C.R. Licklider is launched. Licklider’s idea of an intergalactic computer network, where everyone on the globe is interconnected with the ability to access programs and data at any site, from anywhere, begins to take shape.
1970 – Gordon Moore coins Moore’s Law, a computing term which states that processor speeds, or overall processing power (the number of transistors on a CPU) for computers will double every two years.
1973 – The Xerox Alto personal computer is developed at Xerox PARC. It becomes the first computer to use the desktop metaphor and mouse-driven graphical user interface.
In the same year, the world’s first mobile phone call was made when Martin Cooper, a senior engineer at Motorola, called a rival telecommunications company and informed them he was speaking via a mobile phone. The phone Cooper used, if you could call it that, weighed a staggering 2.5 lbs. With this large prototype device, you got 30 minutes of talk-time and it took around 10 hours to charge.
1975 – The first personal computers were introduced. The MITS Altair 8800 was followed by the IMSAI 8080, an Altair clone. Bill Gates and Paul Allen wrote a BASIC compiler for the Altair and formed Microsoft.
1976 – Steven Sasson, a 24 year old engineer at Eastman Kodak invents the process to make digital photos.
A couple of other Steve’s, Jobs and Wozniak, launch the Apple I. As Apple’s only “kit” computer, consumers need to add a keyboard, power supply and enclosure to the assembled motherboard around the 6502 processor.
1978 – Dan Bricklin and Bob Frankston introduce VisiCalc. The first electronic spreadsheet, it turned the personal computer into a useful business tool, not just a game machine or replacement for the electric typewriter.
1982 – The first thing (as in internet of things) connected to the internet was a Coke vending machine at Carnegie Mellon University. Programmers connected to the machine over the Internet, allowing them to check the status of the machine and determined whether or not there would be a cold drink awaiting them should they decide to make the trip down to the machine.
1983 – On a boat trip to Catalina Island in 1983, five marketing professionals conceived an electronic alternative that would transform the retail landscape.The solution involved using grocery scanners to distribute targeted coupons. Catalina Marketing was born. Catalina created a single solution–the Checkout Coupon–benefitting retailers, brands and consumers.
1983 – Motorola releases its first commercial mobile phone, known as the Motorola DynaTAC 8000X. The handset offered 30 minutes of talk-time, six hours standby, and could store 30 phone numbers. It cost nearly $4,000.
1989 – Tim Berners-Lee, a British scientist at CERN, invents the World Wide Web. The web was originally conceived and developed to meet the demand for automatic information-sharing between scientists in universities and institutes around the world. The first website at CERN – was dedicated to the World Wide Web project itself and was hosted on Berners-Lee’s NeXT computer. The website described the basic features of the web; how to access other people’s documents and how to set up your own server.
1990 – Quantum Computer Services, Inc., introduces Promenade, an online service that will be offered with the IBM PS/1 computer. home computer has been introduced with a built-in modem and online services to provide families immediate access to live, interactive education and entertainment services. Quantum Computer Services eventually became America Online.
1991 – Linus Torvalds invents Linux. Torvalds, a student at the University of Helsinki in Finland, begins writing his own kernel. He started by developing device drivers and hard-drive access, and by September had a basic design that he called Version 0.01. This kernel, which is called Linux, was afterwards combined with the GNU system to produce a complete free operating system.
1992 – Neil Papworth, a 22-year-old test engineer for Sema Group (now Airwide Solutions), sent the first text message on December 3, 1992, from his personal computer to the Vodafone network to the phone of Richard Jarvis. The text message read “Merry Christmas.” AT&T would be the first to offer the service in the US in 2000.
1993 – CERN puts an updated version of World Wide Web software into the public domain. CERN makes the release available with an open license to maximise its dissemination. Through these actions, making the software required to run a web server freely available, along with a basic browser and a library of code, allowed the web to flourish.
1994 – Katie Couric and Bryant Gumbel infamously stumble when confronted with their first email address on the Today Show. Bryant Gumbel asks “What is internet, anyway?”
Jeff Bezos incorporates “Cadabra” on July 5th. A year later he changes the name to Amazon after a lawyer misheard its original name as “cadaver.”
1995 – Amazon.com goes online.
Pierre Omidyar auctions off a single broken laser pointer via a site he’d developed, AuctionWeb, to see if it would sell. To his surprise the item sold for $14.83 and an idea was formed. The company was soon renamed eBay, short for Echo Bay, the name of Omidyar’s consulting firm. eBay’s vision for success transitioned from one of commerce—buying and selling things—to become something far more significant. It thrived because it placed customer data being at the heart of the business from its inception. “eBay was one the first websites of its kind and by giving people a high level of bargaining power it completely democratized ecommerce. eBay has pioneered an ecommerce marketing revolution, particularly when it comes to utilizing customer data in order to deliver a more engaging, seamless online experience. From day one they’ve used customer data to improve platform experience and they’re only getting better at contextualizing their data sources. Its lesson to the internet has been that success comes from continual data innovation.”
1995 – Google begins as a research project by Larry Page and Sergey Brin. Both are Ph.D. students at Stanford University.
1999 – Kevin Ashton coins the term “the Internet of Things” (IoT) while working at Auto-ID Labs.
Oracle executive Marc Benioff invites three friends to his San Francisco apartment. His business idea gets a lukewarm response. Co-founder Dave Moellenhoff doesn’t sugarcoat it, “You’re an idiot. That’s the stupidest thing. This is never going to work.” The group presses forward and launches Salesforce, one of the first enterprise cloud software services in the world. The company pioneered the concept of delivering enterprise applications via a simple website.
2000 – Confinity and X.com merge in March. The combined company becomes PayPal in order to sync up the name of the company with the name of the product.
The United States stops intentionally degrading GPS signals available to the public. Originally developed by the Department of Defense to aid the military, the satellite-based system provides location and time data to users. In announcing the discontinuation of the feature that deliberately degraded the signal, the White House said in a statement that civilian users of GPS would be able to pinpoint locations up to 10 times more accurately than before.
2001 – A free user-generated online encyclopedia called Wikipedia comes online and quickly becomes the reference site of choice for Internet users.
2002 – Internet Archive search director Doug Cutting and University of Washington graduate student Mike Cafarella begin building Nutch. Over the course of a few months, Cutting and Cafarella build the underlying file systems and processing framework that would become Hadoop.
Amazon launches Amazon Web Services, a suite of cloud-based services including storage, computation and even human intelligence through the Amazon Mechanical Turk.
2003 – 500 million devices are connected to the Internet. One device for every 12 people on the planet.
Chris Stolte and Pat Hanrahan invent a technology called VizQL™ at Stanford. VizQL attacks a basic business problem: making databases and spreadsheets understandable to ordinary people. Now, visualization is part of the journey and not just the destination. Fast analytics and visualization for everyone becomes the basis for the founding of Tableau.ne was born.
Scientists announced that they had sequenced the entire human genome two years ahead of schedule. The 13-year international project set out to identify the 20,000 to 25,000 genes in human DNA.
2004 – 19-year-old Mark Zuckerberg launches thefacebook.com in his dorm room as a Harvard sophomore.
2005 – YouTube is founded by former PayPal employees Chad Hurley, Steve Chen, and Jawed Karim. The idea was born at a dinner party in San Francisco the year before, The inspiration was two key events that year: Janet Jackson’s wardrobe malfunction at the Super Bowl and a devastating tsunami in the Indian Ocean.
2006 – Doug Cutting begins working at Yahoo. They spin out the storage and processing parts of Nutch to form Hadoop as an open-source Apache Software Foundation project. Why Hadoop? It was named after Cutting’s son’s stuffed elephant.
2007 – The first iPhone was released combining the internet, a cellphone and an iPod into one device. In 74 days, Apple sells 1 million iPhones.
Waze is founded. The Israeli and Palo Alto-based company is a developer of free mapping and turn-by-turn navigation apps for iOS and Android devices.
Sitting in Zeke’s Sports Bar, Tom Preston-Werner shares an idea with Chris Wanstrath, “I launched into my half-baked idea for some sort of website that acted as hub for coders to share their Git repositories. I even had a name: GitHub.” Fast forward less than a decade later, GitHub is how people build software. With a community of more than 12 million people, developers can discover, use, and contribute to over 31 million projects using a powerful collaborative development workflow.
2009 – USAA, a privately held bank and insurance company, becomes the first company to introduce the mobile check deposit feature, which requires a customer to photograph both sides of the check with the phone’s camera. With just one branch, in San Antonio, and customers deployed all over the world, the company has been aggressively developing an anytime, anywhere banking strategy.
Al Gore makes his infamous claim in a CNN interview, “During my service in the United States Congress, I took the initiative in creating the Internet.”
Web 2.0 hits its stride. Google offers browser-based enterprise applications, through services such as Google Apps.
2011 – The Oxford Dictionary added the common texting acronym “LOL” (laughing out loud or laugh out loud) to its official listings.
2013 – Out of the world’s estimated 7 billion people, 6 billion have access to mobile phones. Only 4.5 billion have access to working toilets.
2014 – Intel and its partners announce that they will begin commercial production of its 800 gigabit per second optical network cables, based on technology developed in its Silicon Photonics lab.
2015 – Amazon surpasses Walmart as the most valuable retailer in the United States by market capitalization.
Barclay’s release a report that Hortonworks, a Hadoop based company, is expected to become the fastest growing software company ever. The company is slated to reach $100 million in annual revenue in just four years from its inception.
The average person unlocks his or her smartphone 110 times each day.
When these innovations from the last fifty years are listed out across several pages, two facts come into sharp focus. First, the rate of innovation is ever increasing. What would seem like a giant leap fifty years ago appears more like a small step today. Second, these innovations are changing the average consumer. Going from a world where connected technology is mostly a dream to such ubiquity where more humans have mobile phones than access to working toilets is nothing short of impressive.
As you consider the journey, there’s no doubt that consumer expectations have changed–we’ve forced them to change with each innovation being faster, smaller and more accessible than the last. The same expectations apply to your business.
Customers expect faster response times, shorter wait times, more value and less cost all at once. The companies who figure out how to serve this modern consumer will thrive. And the others? Their days are numbered.
Blue Goldfish highlights those companies doing the former, using technology, data and analytics to improve customer experience. Technology brought us these increasing expectations and it’s the only thing that can save our businesses from them.
Today’s Lagniappe (a little something extra thrown in for good measure) – Here is Andrew McAfee talking about The Second Machine Age:
The year was 1981—the same year the first Space Shuttle rocketed from the Florida coast. A few weeks after STS-1 launched in April a sixteen-year-old Michael Dell, then a high school student, took a summer job selling subscriptions for The Houston Post.
In his book, Direct from Dell, Michael recounted his time there. “At the time, the newspaper gave its salespeople a list of new phone numbers issued by the telephone company and told us to cold call them. It struck me as a pretty random way of approaching new business.”
By this time, it was mass chaos. Exacerbating matters was the fact that this was a post–September 11th world, where cute disguises don’t go over so well with airport security or law enforcement. Still thinking it was a heart attack, a defibrillator was used to shock me as Lindsay looked on in complete horror.
This is an excerpt from a story that my good friend, John Ruhlin, tells about his proposed engagement in his new book, Giftology: The Art and Science of Using Gifts to Cut Through the Noise, Increase Referrals, and Strengthen Retention.
John reflects on the situation and notes that his elaborate plan to dress up as an old man and surprise his then girlfriend was based on the fact that he loves surprises. She would have been happy with something simple and the engagement should have been more about her rather than him.
John then expounds on this notion and comments, “We make a gift all about us. It’s our event, our colors, our themes, our preferences, our whatever—and it has little to do with the recipient. Be thoughtful about what’s motivating you, and be honest with yourself…[giving] isn’t about stepping into the spotlight—it’s about shining the light on someone else.”
This principle of putting others first and genuinely serving them applies to every Goldfish concept. Too often, companies and people are quick to ask how the Goldfish concepts can build the top-line instead of giving from a generous heart to make the lives of the people that they serve better. Here’s a synopsis of the Goldfish:
Purple Goldfish- Give the little things to your customers to touch their hearts and create a better experience.
Green Goldfish- Go beyond dollars to drive employee engagement and reinforce culture.
Golden Goldfish- Take extra special care of the top 20% of your customers and employees.
Blue Goldfish- Leverage technology to create a better customer experience and differentiate from competition.
Red Goldfish- Embrace purpose to drive employee and customer engagement, and make an impact on the lives of those the purpose serves.
When most people hear those concepts, they typically comment that they share these values and believe that they they’re important, but…
That’s when all of the “but’s” begin to set in and negate everything that was said before:
- We have to experience growth and have quantifiable metrics and returns for our shareholders and investors. We can’t gamble on an “expensive” initiative and not have it correlate to results.
- My boss and the board just don’t share these ideals.
- We just don’t have time. We’re too busy.
On and on it goes. What starts as a positive, fruitful discussion transitions into the same old focus of financial results and nothing more. Oftentimes people will even comment and talk about participating in these business principles but it’s almost always about them and their organization. For example:
- You give nice gifts branded with your logo to try and buy the loyalty of customers.
- You’re nice to your employees because it’s expensive to replace them.
- You invest in technology to alleviate long-term costs.
- You establish a “purpose” as though it’s a marketing campaign to convey how thoughtful and philanthropic you are.
What can you do about this? Here are the three easy steps that you can take immediately:
1. Make a deliberate choice. You don’t have to overhaul your entire organization today to embrace these principles. You simply need to be intentional about positively impacting your customers and employees and make this the focus of your decision-making. Make it about the people that you serve and the strategic plan and little bits of action will follow.
2. Be the catalyst for positive change. If you truly believe that giving, serving, and making a positive difference in the lives of others then why have you not made this clear to your organization? Is it because you’re afraid of being talked about, not fitting in, detracting focus, or temporarily failing? Relentless commitment to creating and sharing vision with others is how positive change will permeate in your business.
3. Establish a plan. Would our team like to work with you to make executing these principles faster and easier? Of course. However, you can do this yourself if you’re willing to take little bits of daily action to intentionally design your customer experience, employee engagement, technology, and purpose. When you figure out what the right inputs are then you’ll inherently discover how they correlate to your top-line results.
Today’s Lagniappe (a little something extra thrown in for good measure) – If you have an hour, check out Lewis Howes interviewing John Ruhlin about the principles of radical generosity. It’s worth your time!
Blue Goldfish brings together two symbolic concepts to describe the intersection of technology and customer experience. To fully explain the connection we must rewind briefly to 10th century Denmark.
King Harald Gormsson ruled Denmark in the 10th century. The medieval king was notorious for uniting Scandinavia and converting the Danes to Christianity. Legend has it that Harald sported a nasty dead tooth that turned blue, earning him the nickname Blåtand, which is Danish for Bluetooth.