Business Success from Empathy?

February 7, 2009

DISCUSSION TOPIC

Empathetic CEO Leads McD’s to New Heights 2/5//09

TOPIC SUMMARY:

There are a lot of reasons one could point to as “the reason” behind McDonald’s success in recent years. There are restaurant remodels, changes to the menu, a focus on value, etc.

While all of the above are certainly contributors, a piece on Forbes.com by Dev Patnaik and Peter Mortensen, co-authors of Wired to Care, posits that the real credit goes to McDonald’s CEO Jim Skinner for “building a widespread sense of empathy… for the company’s customers.”

According to Messrs. Patnaik and Mortensen, Mr. Skinner’s ability to get McDonald’s employees to see how the world and their company looks through the eyes of consumers has enabled them to provide something of true value to those who patronize the fast food chain.

Organizational empathy has also helped make McD’s more efficient. According to the authors, “Empathetic companies don’t get paralyzed by a sea of contradictory information. They have the acuity to cut through the noise and focus on what really matters. Most important, they find ways to lay the foundations for new growth regardless of what their competitors are up to.”

Discussion questions:  Do you agree with the premise that Jim Skinner’s greatest accomplishment has been in making McD’s a more empathetic company? How do you think that empathy is demonstrated in the day-to-day business of McDonald’s?

My post: 

This a very timely and important article to discuss.  I will not claim that empathy is the reason behind McD’s turnaround, but clearly the point of giving the customer what they want through a huge organization of individuals with varying priorities is almost a miracle.  As the authors state in the article, “Skinner’s success reminds us that in a crisis, the best way to get ahead is the best way businesses have done it for centuries: Have a gut sense for what people need and give it to them.”

The “miracle” is in Skinner finding the path to get the 30,000 McD’s employees to focus their talent and time on improving the customer’s experience.  Call it empathy, but Skinner has been able to be seen by franchisees and company staff as relevant, knowledgeable and inspirational.  Therefore, they have listened to his message and have focused as a cohesive organization on delivering for the customer.

Other than Sausage McMuffins with Egg (which are my guilty pleasure), I am not a McDonald’s customer – but I love the story.  Hopefully more CEO’s will read the author’s book, Wired to Care, and move their organizations in a similar direction.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13533

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IKEA irritates the Danes

March 18, 2008

DISCUSSION TOPIC:  Translating Retail Success Across National Borders

TOPIC SUMMARY:

There is yet another potential impact of importing and exporting that retailers are now starting to consider. Boasting 273 stores attracting some 583 million customers each year, IKEA, for example, needs to be aware of what people think and feel.

Both The Independent and The Daily Telegraph in the UK reported that Danish customers of the Swedish shop are less than happy with what’s being offered for sale or at least with what the products are called.

IKEA’s products tend to have names rather than numbers, a situation that has recently caused complaints from customers in Denmark, historically a rival of IKEA’s Swedish-based empire. According to The Independent, complaints have been made about some of the names chosen. Apparently those with Danish derivation are used for some of the retailer’s less salubrious, or lowly, products such as doormats, rug linings and toilet seats, for example.

Discussion questions:  Is the IKEA Danish experience unusual in the arena of global marketing? Where do retailers go to acquire the cultural education required to open without incident in new international markets? Is there are retail company or brand that you think best epitomizes how to go about expanding globally?

My post:

International expansion of brands and retailers always creates the potential for cultural missteps.  IKEA did not purposely named their products with names that would offend Danes.  Using names for their products vs. numbers requires them to either use different names in different countries, or choose to not care if one country has an issue with a name that is fine everywhere else.  

When a retailer or brand expands into a different country (or even a different state) it is incumbent upon them to do some due diligence in the new location, particularly regarding marketing and branding methods.  It would not have been a significant issue to rename a few of the IKEA products for the Danish market if indeed some of the names are offensive.

Examples of brands and retailers who have expanded globally effectively include McDonalds and DFS Galleria.  McDonalds offers key products like the Big Mac worldwide, but then adds menu items that relate to the local populace.  DFS Galleria, the Hong Kong-based purveyor of luxury brands in gallerias and airport duty-free locations throughout the Asia Pacific region, pays close attention to how each nationality communicates and shops.  In-store signage, associate language skills, and marketing efforts all support this.

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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GO TO THE FULL DISCUSSION AT RETAILWIRE.COM:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12829  

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!