Founder's Mentality Blog
I’ve just returned from Sao Paulo, where we had a full-day workshop with more than 30 founding CEOs of some of South America’s most successful growth companies. One of the main themes that emerged from the conference was: “How to keep the voice of the customer and the voice of the front line at the center of management thinking and decision making.” There was a related question particularly critical to the CEOs in the group: “How do we, the CEOs, remain connected with the front line?”
These leaders all understood the danger of the disappearing CEO—the one who retreats from frontline operations of the company to manage internal issues (the board, and so on) and gradually loses touch with the front line. As one founder CEO bravely admitted: “I have no time for visiting our stores because of internal meetings. Ten years ago, I visited a store of one of our competitors and spoke to the competitor’s salesperson, and I was shocked to hear that she had never met her CEO. Now, 10 years later, I have to admit that I haven’t visited all of my own stores for years. I’ve disappeared.”
The group discussed ways to avoid this phenomenon. Here are a few examples:
- Luiza Helena Trajano, the president of the MagazineLuiza department store chain, argued that one of her core jobs is to keep the voice of the customer and front line at the center of management discussions. “Our slogan is ‘Vem ser feliz’ (Come be happy). And our customers email me when they’re not happy. I respond to every email, but I also bring these to the attention of our leaders. I listen and bring our customers’ voices to others.”
- Another CEO of a retailer argued that he also visits stores and asks customers and suppliers to contact him directly with issues. “We have lots of surveys, but nothing replaces direct contact with the customer. The key is to use this information to help and coach others, not to bash them. We have to make customer feedback a learning opportunity, not a performance review.”
- The founder of a business-to-business supplier introduced a regular “Coffee with the President” meeting. “I keep it simple: HR arranges a coffee every week or so and we use the meetings as a workshop to share issues and solve problems. I also use it to share the core values of the company. I keep them on a laminated card in my wallet and use every opportunity to remind our people that the customer is the center of everything we do.”
These examples are similar to efforts that have been described by other CEOs. In his book, Management in 10 Words, Terry Leahy, the former CEO of Tesco, described the TWIST (Tesco Week in Store Together) program he introduced to ensure his leaders understood frontline issues. He writes, “[W]e suffered the same problems as any other organisation: people get tied to their desks and bogged down by their own workload. … To get under the skin of the business, the senior management … had to commit more time to being on the front line.”
Leahy formed a contract with his senior team: He would spend a week in the stores doing all the jobs, if they would as well. They would “TWIST” once a year. He concludes, “I learned more in that week than in any other week that year. …. I had plenty of ideas to take back to head office, but … what really mattered was the 3,000 managers who would TWIST after me. … Their first-hand experience … was a revelation for the entire company.”
As we discussed experiences in our Sao Paulo meeting, Salim Mattar, chairman and founder of Localiza, shared a story about the challenge of keeping his team customer-focused. Localiza is the largest rental car company in Latin America, with more than 540 rental locations. The company’s growth created huge challenges, including making sure that Localiza managers and employees could be trained and coordinated (requiring lots of internal meetings), yet also have time for customers.
“One customer called the local Localiza rental location with an urgent question,” Salim recounted. “It was early in the morning, and he had ordered a lot of cars for 1 that afternoon. But he needed to change some of the cars because his teams had changed their plans. He was anxious to confirm these changes would be OK. The local site manager who had worked with him was in an internal meeting, but her assistant promised she’d call back by 10. At 10:30, [the customer] called back, having still not heard from her. The assistant apologized profusely and explained that there was another internal meeting, but the site manager would call back shortly,” Salim said. “He was too anxious to wait and called my offices. My assistant immediately put him through. He was embarrassed, explaining, ‘I’m so sorry, Mr. Mattar, I didn’t mean to actually reach you. I just wanted to leave an angry message to ask your office to get your local office to call me back.’ I explained that this was no problem; I was here to help and would happily confirm his order, which I did. He was surprised he could reach me, and pointed out that it was somewhat odd that it was easier talking to the CEO then the local management. I agreed.
“I immediately decided to lead a discussion on the company’s values,” Salim recalled. “I couldn’t believe that someone would put internal meetings ahead of the customer. But the more I probed, the more I realized we were inadvertently sending signals that internal meetings were more important. We were telling managers to make sure their people came to training programs regardless of how busy they were. These meetings were important, of course, but we had lost balance. So we talked together about how to deal with this and came up with a simple value that all of us believe in. It is a nonnegotiable now that customers come first.”
With that, Salim pulled out his green-covered Values and Code of Ethics guide, where he has underlined the following sentence: “Responding to our clients takes priority over meetings, events, training or any other commitment.”
As the founder CEOs discussed the ways they keep the voices of the front line and customers at the center of management thinking, one thing was very clear: Each of them felt it was their personal mission to listen to these voices. At the conclusion of the meeting, we asked each of the attendees to describe one thing they will do differently on Monday.
One answered, “I am shocked by how little time my team spends with customers compared to some of the leaders here. I can’t wait for Monday. I will act today to get my team away from our desks and back in the field.”
The three elements of the Founder's Mentality help companies sustain performance while avoiding the inevitable crises of growth.