by Laurie Jakobsen
I caught up on a big pile of magazine reading while I was traveling to and from NARM’s Music Biz 2012 event. A few different stories caught my eye in particular, and I think they all highlight the dangers of communication disconnects: between a company’s stated values and the actions it rewards, and also between what a business thinks a customer wants and what they actually do. As a result, bad actors get the proverbial carrot, and potential customers get the stick.
Jack and Suzy Welch’s column in the April 30 issue of Fortune, “Goldman, Wall Street, and the Culture-Killing Lesson of Being Ignored,” focused on what they thought was missed in the Greg Smith saga: the importance of “soft culture.” As they put it, “Creating a healthy, high-integrity organization is not all puppies and rainbows… it’s about behavior and consequences.” Companies belabor their mission statements, goals, and values, but the real question is whether they will actually put those values into action. As the Welches note, for employees that deliver high on numbers but low on stated company values, “Ninety percent of the time, managers give these people a big fat pass…Actually [what they] are doing is sending a big fat message to every other employee: Our company’s values are a joke.”
I had this in mind as I turned to Brent Schlender’s recollections of 25 years of conversations with Steve Jobs in the May issue of Fast Company. Jobs is quoted as saying: “Incentive structures work… So you have to be very careful of what you incent people to do, because various incentive structures create all sorts of consequences you can’t anticipate.” Taken together, I think the message here is, if employees’ behavior is not aligning with stated values and objectives, question first how and why the organization rewards such behavior. The well-crafted mission statement is no match for a fat bonus.
In these two instances, the danger is that a company gives a “carrot” for the wrong behaviors, disincentivising people from taking the right ones. But turning to look at an example of a customer communication disconnect, you can also see the mismatch when a business unintentionally punishes a customer by giving them what they think is a carrot – but is the wrong reward.
The May issue of The Harvard Business Review has a great chart illustrating “What Consumers Really Want” from businesses’ social media connections. Businesses think customers join them on social media platforms to learn about new products, get information, and submit their opinions. But it turns out customers’ primary reasons are transactional: first, they want discounts, and second, they want to purchase. These were ranked dead last as business’ perceived reasons why consumers follow them via social sites.
It does not take a fancy marketing test plan to get some sort of compass on how customers work. I once advised a friend with a new local business idea to take a Saturday and poll people in New York’s Union Square to see if there was real demand. Chris Sacca of Lowercase Capital in the May issue of Wired’s “How to Spot the Future” offers a simple way to address some of the customer disconnect: watch the behavior of actual people. “I walk around Best Buy every three to four weeks and watch people. When you do this, you see how normal people make product decisions, what their price breaking points might be. In a world of people who’ve got stock options, there isn’t a difference between an $80 thing and a $110 thing, but for real people working hourly wages, there is a huge difference.”
Organizations don’t set out to reward bad employees and punish their customers, but without careful listening and honest observation, that’s exactly what can happen. Communication is about taking in information as well as putting it out – if you’re not getting the results you expect from your staff or your customers, it may well be time to reevaluate exactly what behavior you’re really promoting.