In a 2005 Bain and Company survey of 362 companies, a huge gap was identified between what customers experience versus what companies thought they were delivering.
The gap was not just huge, it was staggering! Only 8% of customers in this survey described their service experience as “superior” while 80% of the companies described the service they provide as “superior.”
Tom Peters calls this the 8/80 chasm!
I have experienced this 8/80 chasm on a few engineering projects over the years.
An engineering contract typically has a ton of detail built into it. Because of this, it is really easy to fall into the trap of “working to fulfill the contract” instead of working to understand exactly what the customer needs before you are too far down the design road to make adjustments.
When a project manager falls into this trap of managing to the contract, it is inevitable that they will encounter a customer who is not happy with the finished product. Usually, when this happens, the project is so far down the design path that the effort to get realigned with the customer’s expectations is extremely painful for both the project manager and the customer!
So what can businesses do to bridge this chasm or avoid it altogether?
There are people who shy away from challenges and then there are people who are energized by attacking challenges and “defeating” them!
There are pros and cons to both approaches. However, I am not aware of any great accomplishment or breakthrough ever happening because someone was running away from a challenge!
All major technology, medical, literary, artistic, or other societal impacting breakthrough has happened because someone identified a challenge, took it on, and solved it!
I was reminded of this by my grandson Jett. He is going through a phase where scaring him does not result in him running away. Rather, he turns towards the “threat” and runs directly at it. He is challenging the threat!
This does not mean that he is always successful in “defeating” the threat. In fact, most of the time he fails . . . but this does not deter him or keep him from trying again!
And, as business leaders, this is what we all should be doing!
Things You Can Count On By Taking on Challenges
This week’s book summary is a podcast link. I was recently featured on the “Ideas and Stuff” podcast episode 50! We covered a lot of ground in about 30 minutes, including:
- Vision, Mission, Values
- Managing risk
- Business failure
- 15 Minute Business Blueprint
- Mastermind Groups
Check it out here and let me know what you think in the comments below!
A single point of failure, SPoF, in your business can literally devastate your business overnight yet many business leaders spend little or no time at all protecting their business against these risks!
In 1995, a rogue trader brought down Barings Bank through fraudulent, unauthorized, speculative trading. The bank, which had been established in 1762, had a single point of failure and did not have controls in place to protect itself. It’s SPoF destroyed it!
Similarly, uncontrolled trading of oil futures has crippled more than one oil company in recent years. Other businesses have been bankrupted due to manufacturing shutdowns caused by natural disasters, social uprisings, political unrest, wars, etc.
Over the last nine weeks, I introduced my Ebook 12 Steps to Business Transformation and I defined the first 9 of the 12 transformational steps. This week we are going to talk about steps 10, 11 and 12.
Steps 10 to 12 in my new Ebook “12 Steps to Business Transformation” deal with the outputs of your business which I call Outcomes. These are the resulting services or products that are created by your business.
- Step 10 is the actual Outcome. What has your business produced? Is it acceptable, not acceptable, substandard, above standard, on cost, over cost, on schedule, behind schedule, on spec, off spec, etc.
- Step 11 is the feedback that you are taking from the Outcome and sending back to the business for adjustments to improve the quality of the Outcome
- Step 12 is simply the ongoing, disciplined operation of your business . . . Basically, repeating Steps 9 to 11