By: Jim Champy
I have never shot a gun, so I was somewhat anxious when the CEO of Smith and Wesson, the venerable handgun manufacturer based in Springfield, Massachusetts, invited me to visit their plant. Smith and Wesson was one of the companies I had targeted to write about in a series of books examining new business models.
I had been looking for companies that were innovative, both in what they offered to customers and how they operate -- and companies whose business propositions inspire customers to come back. I considered a sustained high growth rate to be an indicator of success, and Smith and Wesson had met the criteria.
But the surprise of my visit was not handling a handgun. It was experiencing what I would describe as a company culture of engagement. My tour of the plant began in the stamping room where raw metal was forged into a gun form. The room was dark, dusty, and had an 18th century feel. The gun forms then moved to highly sophisticated, digitally controlled milling machines. Eventually, the parts got to tables where workers assembled the final product.
When I was introduced to the workers, they proudly began telling me about their success in cycle time reduction. They were continuously applying quality improvement techniques to shorten the time to assemble a gun. There were charts on the wall, showing their progress. They even lectured me on the techniques of Kaizen, the Japanese version of quality improvement. But it was the level of employee engagement in dramatically improving the performance of Smith and Wesson that was most impressive. These are workers engaged in a mission to grow the company -- and grow with quality products.
In all of the companies that I have written about, I have found an engaged workforce -- encouraged and inspired to do the right thing. There are several cultural characteristics that these companies and their people share.
A Culture of Innovation Many companies treat business innovation as a process and take mechanical steps to generate new ideas -- everything from “suggestion boxes” to competitions. These techniques can produce results, but my research suggests that innovation is driven as much by culture as it is by process. Innovative people and companies just behave differently. They are always searching to improve their products, services, and processes.
One of the most innovative companies that I have seen is Zipcar. It’s pioneering the idea that urban dwellers can own a share of an automobile. In the Zipcar business model, cars are located in parking spaces in local neighborhoods. Members can access the car of their choice, when they need it, through IT and satellite links. The people at Zipcar work hard at constantly innovating around convenience and choice.
When I visited the Zipcar headquarters in Cambridge, Massachusetts, I experienced a model of team innovation. The office had an “open plan,” where people could engage with each other and contribute ideas. Accomplishments and breakdowns were posted on the wall for everyone to see.
Culture vs. Rules Smart and inspiring companies also use company culture, not written rules, to manage the behaviors of their people. In these companies, culture dictates that people must do the right thing at the moment of truth. And that moment of truth is generally when a customer is in need or crisis. These cultures value the quality of the customer experience and allow people to do whatever is required to respond to the customer need.
I have been impressed with the service models I find in smart and inspiring companies that are great places to work. Smartpak is one such company, serving horse owners with vitamin supplements for their aging or ailing stallions on a subscription basis. It’s a much bigger business than you might think and grows because of a highly skilled and knowledgeable customer service staff. Service reps are encouraged to stay on the phone with customers and advise them on animal health issues -- and all service reps have some form of veterinary training. You don’t find rule books in companies like this, but you do find people doing the right thing.
Authenticity People in these companies also have a penchant for truthfulness. They represent the products and services of their companies with authenticity. Whether in advertising or on a product label, they only make claims about what they can deliver on. People in these companies know that if their products or services do not live up to their claims, they will be caught by the Internet police. Authenticity is a cultural characteristic that’s driven from the top, usually by a company founder or CEO. Everyone knows how they are expected to behave, and they work for the company because they enjoy being honest!
Authenticity is a great virtue and I believe that it keeps customers coming back. The company, Honest Tea, goes so far as to assert authenticity in its name. And if you look closely at its products and how it operates, you will see that it is true to its espoused values of treating suppliers with respect, as well as its commitment to producing healthy products. One customer was so inspired by Honest Tea’s behavior that it declared, “You are so honest, I wish that you were my bank.”
I have always believed that great companies have great cultures, cultures in which people share high-purposed values and the freedom to act. In the companies that I have researched and written about, these values promote excellence and quality -- and a caring for employees, customers, suppliers, and neighbors. It may sound “old fashioned” but these kinds of values drive success.
Jim Champy is the Chairman of Consulting for Dell/Perot Services. His latest books are OUTSMART! How To Do What Your Competitors Can’t, and INSPIRE! Why Customers Come Back.