OK, so my wife goes to buy a pair of shoes at Dick’s Sporting Goods. While she is there she observes that there is a customer returning a pair of shoes bought from the another location. The staff did not want to take the shoes back because this would show up negatively on their store profit. From the customer perspective, they went to the other store because of a greater variety of shoe selection and had returned to this location because it was close by their home. Ultimately, the staff member accepted the shoes back knowing that this might affect his stores numbers and might even (some day) lead to its closing.
While doing bank management consulting, I observed the same behavior at branches. Many banks would advertise their CD rates and calls for the CDs would go to the call center. And instead of opening the account on the spot, the call center was forced to send and/or transfer the customer to a branch. This was all about the branch getting credit for the CD opening and reflected in their branch profit. Would the customer have preferred to open the account on the spot? No one knows for sure, because no one ever asked or looked at it from that perspective.
I am always amazed at the great waste and trouble organizations will go through to make sure that the income statements are accurate and the targets are hit at great cost and decreased service to customers. The systems thinking organization understands what is important to the customer and then builds its system to optimize value to the customer first. This always leads to business cost reduction and business improvement that the command and control thinker can not see. Command and control thinkers are too busy making sure that each component is “optimized” for profit and fails to see what really matters to their customers.Share This: