Leading by letting go
This article originally appeared on HBR.org.
If you are running a large company anywhere in the world, you have almost certainly asked yourself some version of this question: “How can we get tens of thousands of employees to deliver memorable customer experiences that enhance our brand, all at a reasonable cost?”
The answer many have latched onto might best be called “Tightening the Grip.” This involves making it easier for employees to deliver in the same way every time by prescribing exactly what they should do in all circumstances. In a customer service center, for example, you would create scripts for every possible interaction. You’d ensure quality by listening to recordings and holding service representatives accountable for meeting detailed standards, such as using a customer’s name a certain number of times on each call. You would recognize high performers, and you would discipline reps who didn’t measure up. You would also monitor average call time closely for every representative. To keep costs under control, you’d set goals for reducing it every year.
Jim Bush had a different idea, which I have now come to call “Leading by Letting Go.” I’ve mentioned him before in my blog posts, but I haven’t really told the whole remarkable story.
Bush took over American Express’s far-flung service operations in 2005. He was suddenly responsible for many thousands of call-center employees. Even though American Express was well-known for its outstanding service, the company at the time regarded Bush’s organization purely as an expense, and it followed the conventional command-and-control model in its call centers. Leaders kept a tight rein on costs, with goals for reducing average call time, improving customer satisfaction levels, and driving more service volume to the Web. While customer satisfaction was at acceptable levels, competitors seemed to be catching up. Especially troubling to Bush, employee turnover was high, reflecting a long-standing decline in employee morale and imposing a huge burden on the organization.
Bush saw a way to change the game. Service at American Express, he argued, should not be treated as just a cost center; rather, it offered an opportunity to invest in building the sort of warm relationships between American Express and its customers that the venerable company’s brand had always been based on. Every interaction offered a chance to make people feel good about their relationship with the company. Every contact offered an opportunity to increase the likelihood that they would sing the company’s praises to friends. That kind of viral marketing would be invaluable in setting American Express apart from rivals and would power the company’s growth and profits.
The trouble was that the scripts, metrics, and rules were getting in the way. Heavily scripted representatives couldn’t form genuinely warm and empathic relationships. They sounded wooden and stilted. Real relationships are built on open, person-to-person communication, one caring human being to another.
So Bush decided to let go. He eliminated the scripts. He stopped focusing on call time and declared that from now on representatives would let customers set the pace, determining how much time they would spend on each call. He elevated the hiring process, seeking out people with the right personal qualities and values, often with experience in the retail or hospitality industries rather than in other call centers. (The centers’ high turnover helped him change things on this front pretty quickly.) He even changed the name of the job. He called the service reps customer care professionals and gave them business cards, along with higher pay and greater flexibility in scheduling their hours.
Then he created a system that enabled and encouraged these professionals to deliver outstanding service on their own, day in and day out. It depended upon four key elements:
- A clear goal. American Express wanted warm, caring interactions with customers, unregulated by the clock or by scripts. The customer care professionals would see information about each caller on their screen, and they would get intensive training in the company’s products and policies. What they talked about was up to them—and to the customer. They would measure their success by the Net Promoter Score—the percentage of customers who said, when asked, that they would recommend American Express to a friend.
- Guardrails. People handling calls understood where they had latitude and where they didn’t. They knew they were accountable as teams for delivering the best possible service within the constraints of the company’s policies and in strict compliance with laws and regulations. Within those guardrails, however, they were free to exercise their judgment.
- High-velocity feedback. The company began seeking feedback from a sample of customers after each transaction, asking them how likely they would be to recommend American Express to a friend and why. The resulting scores and verbatim comments flowed to frontline team leaders and customer care professionals every day, so they could see where they were succeeding, where they still had work to do, and what, specifically, the customers had pointed out.
- Coaching and support. Supervisors and experienced customer care professionals were freed up from a number of other tasks so they could devote more time to coaching around the feedback. They helped new hires get up to speed. Trainers taught best practices and ways to improve. Teams shared with and learned from one another.
The results? Call-handling time edged up slightly at the very beginning, then dropped and kept falling. Likelihood-to-recommend scores doubled, indicating far more enthusiastic advocacy of American Express on the part of customers. Employee attrition was cut in half. Within just three years, the company saw a consistent 10% annual improvement in what Bush calls “service margins.” The company began to win the J.D. Power customer service award in credit cards year after year.
It is simply impossible for any leader to prescribe exactly what thousands of employees should do every day and in every circumstance. Even if it were possible, doing so would reduce their behavior to only what could be scripted and supervised. More importantly, the mere attempt to do so is dehumanizing and demoralizing. It drains the life and the initiative out of even the most highly motivated workers.
But when you set up a system that enables you to let go with confidence—to trust your employees to exercise their own judgment and learn from their experience—employees can become both self-directing and self-correcting. They become inspired, energetic, and enthusiastic. And the experience they deliver to customers is likely to be far better than anything you could ever control.