Tag Archives: Southwest Airlines

Insurance is Not a Commodity? Hmmm

I was scanning the Insurance Thought Leadership site, and saw the Most Popular Article today is Insurance is not a commodity, by Chet Gladkowski. Number 10 on this same list was Lemonade – Insurance is changed forever, by Rick Huckstep. Both articles were well written and thought provoking (for us folks in the insurance industry). For the average consumer, I suspect both articles would probably not be read or certainly not rise to the top 10 list of non-industry professionals / consumers. 

I believe the biggest threat to our future as agents and the insurance industry is not technology, generational change, a global economy, AI, innovation, etc. I believe it is, to quote Pogo – “we have found the enemy and he is us!” The Insurance, Financial Services and Risk Industries exist for customers / clients, yet we as the “vendors” or “service professionals” for this industry – all too often think it’s about us. We tend to define our business model in terms of products and services offered versus clients served.

We are self- defined as P&C agents, Life and Financial Service professionals, Risk Managers, Bankers, Consultants, etc. We tend to be “product defined and product driven” versus “client defined and client driven.” What if we became experts first in our clients and their wants and needs and facilitated their buying versus being “sales reps” for the manufacturers – the insurance companies, banks, brokerage firms, etc.

See also: Has Auto Insurance Become a Commodity?  

Here’s reality – as I perceive it – sometimes buyers just need / want a commodity (term life), a product (BOP or group policy) or a service (a self-funder plan or retirement planning). My experience indicates that most consumers “want what they want and they want it now” on their terms and with their definitions. 

Our industry will protect our future when we look more to the marketplace and spend less time looking in the mirror! Below is an article written months ago yet appropriate food for thought in light of the above – are you like Southwest Airlines or a bad gelato store?

What did you do for me today? 

I was flying back from Milwaukee. The bad news is that I had to spend time in airports and airplanes. The good news is that I got out before it got crowded and the best news is that I flew Southwest Airline (SWA). In my opinion, flying can be worse than a root canal. What makes SWA different is they use enthusiasm and fun to “sedate” you from the pain of the flying process (cramped space, bad weather, security checkpoints, etc.).

If you haven’t flown with SWA before – try it you’ll like it. If you have you’ll understand what follows. It’s the simple things – a smiling face, a pilot and attendants who inject humor and song into the mundane process of telling us what we need to know but don’t want to hear. They even give you two small bags of peanuts (instead of one). I know this sounds insignificant until you’ve flown on airlines that don’t sedate you.

When we deplaned in Atlanta I stopped at a Gelato stand in the Concourse. I was reminded of what a root canal without the sedation is like. The “lady” behind the counter came across as a Don Rickles’ type character without his charm. She served me a scoop of Chocolate Chip Gelato (about the size of a golf ball) in a cup the size of a single shot jigger. The Gelato was very good – the service and presentation weren’t. At $5.99 a scoop – I don’t think it’s wrong to expect a smile, kind word, or a thank you.

In the name of full disclosure – I think I presented myself well to the “lady” – I think I was my cute, charming and polite Southern Gentleman self. She may have been having a bad day – which we all do. Nonetheless my experience is determined by what happened to me not what may have been happening in her world that day. I was the customer!

Here’s the parallel to the agency business. I realize, whether you are an airline, Gelato stand, or Agency, customer service is not always easy. You have hundreds (thousands?) of customers that have to buy insurance or use the product they’ve already bought. Some have just had a claim, others an audit, others a loss control inspection and still others merely need to make a change to the policy. Some are nice people, some are nice people having a bad day, and some are not so nice whether their day is good or bad. Like an airport, dealing with the insurance industry is not the most exciting part of anyone’s day. 

See also: Agents: What’s That Spot on Your Face?  

Agents measure themselves against Best Practice Guides. These guides “count” what you did or will do. It measures “things” you do every day. Retention and additional sales of policies and clients – in my opinion – is the more important measure of success or failure. Are your customer’s “coming back for seconds” or will they be like me and “avoid your Gelato stand next time they need something sweet to eat.”

About 35 years ago I wrote a column in national publication about “whether agents sell a product, commodity, or service?” Today I realize that I missed the point – it is not what agent’s sell, it is about what clients “perceive” (feel) they receive from what they buy. It is about the experience created for them in dealing with you and the carrier. Will their memories include a kind or comforting word you offered, the help needed, a smile, song, or a “second bag of peanuts? Will their experience keep them coming back for more, whether that is for a commodity, product, service or a similar experience?

Did Uber Just Make a Wrong Turn?

Last month, Uber Technologies took action to heal a rift with its drivers, but it may have inadvertently created a rift with its customers.

The company announced a class action settlement with its California and Massachusetts drivers, who sued Uber for classifying them as independent contractors, rather than as employees.

The settlement, if approved by a San Francisco judge, will leave the independent contractor classification intact, but it will also give Uber drivers some new rights.

Among those new rights is allowing drivers to post signs in their cars soliciting tips from customers. And that’s where Uber’s ride might get a bit rocky.

Uber and its ride-hailing app arrived on the scene in 2009, and the company has enjoyed spectacular growth ever since. Fueling that success has been Uber’s innovative customer experience — which isn’t just great, it’s magical.

With the push of a button on a smartphone, a private car rolls up curbside ready to take you wherever you need to go.  You get in, you go, you get out. That’s it.

There’s no fumbling for cash to pay the driver, no math problem at the end of the ride to calculate a tip from a fare meter. Uber just charges a flat fee for the trip to the credit card on file for the customer.

It is, in a word, effortless for the passenger, both physically and mentally.  But that could change if drivers start soliciting tips.

Uber’s app has no facility for adding a tip to the fare, and the company has indicated it has no intention of incorporating that capability. So, with the driver’s ability to solicit tips, the cashless interaction, a hallmark of Uber’s customer experience, is replaced by one that looks and feels a lot more like a traditional taxi cab. Furthermore, a service that had been free of the emotional baggage of tipping (should I or shouldn’t I, and, if so, how much?) will suddenly become more mentally taxing.

Instead of feeling liberated from the typical taxi fare ritual, Uber riders may feel “guilted” into tipping their driver (especially because Uber’s bidirectional scoring system lets drivers and passengers rate each other).

In Uber’s defense, it’s possible that tip solicitation was the least of all evils at the settlement negotiating table. What’s troubling, however, is that tipping — as handled in Uber’s ecosystem — undermines a key point of differentiation for the service. What was effortless suddenly becomes effortful.

Down the road, that could present a problem for Uber and could perhaps be a give a lift to Lyft, Uber’s primary competitor in this space (which, incidentally, offers cashless tipping via its app).

See also: New Questions on Uber and Lyft

To survive long-term, businesses have to adapt, be it to changing circumstances, marketplaces, regulations or environmental influences. What’s important, though, is to make sure those adaptations don’t undermine foundational elements of a company’s value proposition (in the case of Uber: rider convenience.)

Southwest Airlines, for example, has long resisted charging fees for baggage, even as the rest of the industry has collected billions of dollars. Why? Because the company views the lack of fees as a central component of its passenger-friendly policies — policies that, to quote the stated brand purpose, give people the “freedom to fly.”

Southwest has also avoided flying any aircraft other than the Boeing 737, viewing that operational simplicity as a critical ingredient to delivering a superior passenger experience. (Southwest’s acquisition of AirTran in 2011 was almost derailed over this point — until Southwest got Delta to take over every non-737 airplane in AirTran’s fleet.)

So follow Southwest’s lead and ask yourself: What elements of my firm’s customer experience are truly sacrosanct? What are the characteristics or components that are so central to our brand experience they should never change?

Put your finger on those elements now, when you’re not in the middle of a stressful business decision that might cloud your judgment.

Then do your best to protect those pillars of the experience, limiting adaptations and accommodations to areas that are less likely to dilute the brand differentiation you’re trying to cultivate.

See also: Will Workers’ Comp Kill Uber, Lyft, Etc.?

With Uber opening the door to gratuities for its drivers, we may be witnessing a “tipping” point in the evolution of the company’s customer experience (and not for the better).

Avoid putting your business in a similar situation by clearly identifying – and preserving – that which sets you apart in the marketplace.

This article first appeared at Watermark Consulting.

Amazon Prepares for Zombie Apocalypse

Amazon is revered for being a very forward-looking business. So, with the inclusion of a “zombie apocalypse” clause in its latest terms of service, should we all be worried?

It’s right there in paragraph 57.10 of the company’s Lumberyard games development engine, a 3D game design program for use with Amazon Web Services (AWS):


In this paragraph, Amazon notes the program is not intended for use with “life-critical or safety-critical systems,” except if the Centers for Disease Control and Prevention (CDC) declares the presence of a “widespread viral infection transmitted by bites or contact with bodily fluids that cause human corpses to reanimate and seek to consume living human flesh, blood, brain or nerve tissue and is likely to result in the fall of organized civilization.”

Translation: If the zombie apocalypse comes to pass, you can use Lumberyard for whatever the heck you want.

All right, so Amazon is injecting some humor in what are typically long, boring and dense terms of service that, let’s face it, no one ever reads—for any company.

But the fact that the flesh-eating undead can be referenced in a document like this with almost nobody noticing speaks to a larger and more serious issue: Disclosure documents like Amazon’s are an awful way to communicate important information to your customer.

Companies bury important details in opaque disclosures they count on no one reading. Examples abound—coverage exclusions for your insurance, service fees for your bank account, cancellation fees for your gym membership, price increases for your cable TV package or conflicts of interest for your financial adviser. Organizations hide behind these disclosure documents and point to them as evidence that anything important is, indeed, revealed to the customer.

But here’s the key these companies are missing: Disclosure is not a proxy for transparency. Indeed, as practiced these days (with pages of unintelligible fine print), disclosure is the antithesis of transparency. So let’s start referring to disclosure documents for what they really are: a tool businesses use to convey information they don’t want anyone to see. Until more companies reject such disingenuous practices (like Southwest Airlines has done with its Transfarency strategy), consumer trust in businesses will continue to erode.

Do you want to strengthen your customer relationships? Go beyond the legally required disclosures and start communicating with people in a clear and forthright way. That sends a signal to your customers that you’re advocating for them and helping them avoid unpleasant surprises, whether that’s in the form of excessive fees, conflicts of interest or, even, the zombie-induced fall of organized civilization.

That’s the kind of advocacy from which loyal brand advocates are born.

This article first appeared at Watermark Consulting.

How to Hire for Attitude: 5 Steps

What do companies like Southwest Airlines, Ritz-Carlton and Zappos have in common? They hire for attitude and train for skill.

It’s a simple mantra but one that has a profound impact on how to successfully recruit and select new employees.

Prioritizing Soft Skills

During their hiring process, these companies weigh “attitudinal” characteristics very heavily.

These are personal attributes that it’s difficult to train employees on — such as being a people-person, having an upbeat personality or possessing a keen ability to learn.

While these firms won’t ignore technical skills (Southwest doesn’t put unqualified pilots in the cockpit, no matter how bright and cheery they are) they nonetheless look very carefully at these soft skills — far more than most employers do.

These companies gain a lot from this hiring strategy. By focusing on attitudinal characteristics that align with their company brand, these companies reinforce their distinctive company culture with each new hire.

And because they’re hiring people whose values align with that culture, the result is a workforce that’s happier, more engaged and less likely to turn over.

But the benefits of this hiring process don’t stop there. When a workforce embodies the company brand (think how Southwest employees exude “fun”), it differentiates the customer experience where it counts most — in consumers’ one-on-one interactions with your staff.

If you have any doubt about the power of that dynamic, just consider how Southwest, Ritz-Carlton and Zappos have dominated their respective markets.

Five Steps to Hiring for Attitude

So how should you go about hiring for attitude, seeding your workforce with true brand ambassadors? You could run your applicants through personality tests and behavioral assessments — but that can be pricey, time-consuming and onerous for the candidates.

Fortunately, there are other approaches you can employ to put this strategy in practice. Here are five simple, low-cost ways to hire for attitude:

1. Be clear about expectations.

Take advantage of candidate self-selection by clearly broadcasting what qualities you look for when bringing on staff.

For example, if you tell the world that you’re in the market for extroverts – fewer introverts will apply (and that’s a good outcome for you and them).

By defining what personal qualities you’re searching for up-front, you make it more likely that candidates with those attributes will throw their hats into the ring.

2. Be aggressive.

Don’t just wait for people with the right attitude to apply for a job – spot them in the marketplace and make your pitch!

When you see someone who clearly embodies the qualities you want on your team, give her your card and invite her to apply for employment.

As any great recruiter knows, that extremely attentive waiter, remarkably patient sales associate or well-spoken repairman could be your next great hire.

3. Focus on the person behind the paper.

Gauging attitude from a resume requires insight and vision. Consider how the personal qualities you seek would manifest themselves in a candidate’s resume and background.

For example, individuals who are adept at overcoming adversity may have demonstrated that spirit in how they responded to a layoff. People-oriented extroverts may belong to a variety of business associations and community groups. Skilled communicators will likely design and organize their resume content in exceptional ways.

In addition, your interview questions can also reveal attitudinal characteristics. Looking for someone with customer service in his DNA? Ask about the most over-the-top service he ever delivered (the best service people never forget such stories).

Looking for someone with a sense of humor? Ask about the time she laughed the hardest.

Whatever attitude you seek to hire, the key is to look beyond the words on the resume and search for more subtle clues about a candidate’s character.

4. Observe applicants when they think no one is watching.

Want to see a candidate’s true colors? Then see how he behaves when he thinks no one is watching.

How did the applicant treat your receptionist? Did he strike up a conversation with other applicants in the waiting room? Did he eat alone in the cafeteria or introduce himself to a table of strangers?

What the candidate says and does outside of the hiring manager’s view can give you a glimpse into her true personality (which may differ from how she presents in an interview). Use these clues to help judge if the applicant will really be a good fit in the culture you’re cultivating.

5. Enlist today’s stars to spot tomorrow’s standouts.

Toward the end of the hiring process, see if it’s possible to have your job finalists spend some time shadowing existing employees.

This serves two objectives. First, candidates get an unfiltered look at the job they’d be performing, so there’s less chance of unpleasant surprises and post-hire buyers’ remorse.

Second, by pairing these finalists with the best employees (the ones who embody the desired attitude), your existing staff can help identify those applicants who have the right stuff.

Hiring for attitude is about building a distinctive workplace culture and company brand that, unlike skill sets, can’t easily be copied in the market. It’s what gives Southwest Airlines, Ritz-Carlton and Zappos their unique character — and competitive advantage.

Follow the lead of these legendary firms as you look to recruit great candidates. Don’t just hire for skill; hire for attitude. It makes all the difference.

This article originally appeared on monster.com.

Stop Drowning in Big Data; Use It Right

What’s the big deal about big data?

Big data is an enormously appealing subject these days. However, many companies miss the big picture when collecting it — or drowning in it. There is an idea that the more data, the better. In fact, the focus should be on determining the right data to help improve the overall customer experience.

Raining Big Data
Big data is like the weather — we’re talking about it, but we haven’t quite figured out how to do anything about it. Even fewer know how to leverage it. There are lots of questions but few answers. For example, who’s familiar with the 3Vs?

But don’t be afraid to get wet. Data can be used to improve many things for many people – including your employees and customers. I say “can” because, before you do anything, you need to make sure you are using the right data — and not just the random troves collected throughout the years. Mining the right data can lead you to the right customer problems, which can then be solved, creating a better customer experience.

Background Checks
Always define before measuring. What does great customer experience look like in your industry? Figure out what you need to do to wow customers and then compare that with the reality of your business as it stands now.

I’ve utilized customer journey mapping, net promoter scores and voice of the customer metrics with great results. You can even provide customers incentives to help you out with input.

Here’s a smart way to do that. Start by checking the leading survey on customer experience, the Forrester Customer Experience Index, to see where your organization lands. It might surprise you.

Reliable Friends Are Powerful Friends
Right data helps organizations do many things, including:

• Anticipate what customers want before they ask for it
• Identify customer pain points and resolve them
• Create new business value
• Improve customer service interactions
• Develop more effective marketing and better products
• Improve operational efficiencies

Take Southwest Airlines. It’s using speech analytics to extract data-rich info from live-recorded interactions between customers and personnel to get a better understanding of customers.

Or read about Avis Budget’s data-driven growth model. It uses big data to identify the most valuable customers today and tomorrow.

How, you ask?

By examining a broad range of data sources, including structured information like purchase histories, CRM data and intelligence from industry partners, as well as unstructured information like social media, blogs and videos. Sorting through the data has helped all customers be treated like VIPs.

These are only two examples of forward-thinking leaders using the right data to create actionable insights that monetize their data. There are many more. What about your competitors? How far along are they down the big data road? And are they using the right data?