Customer Reviews

Human Sigma: Managing the Employee-Customer Encounter

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In this volume, John Fleming and Jim Asplund present and then examine with both rigor and eloquence what they characterize as "a new set of rules and a different way of thinking about managing [a] company's complex human systems, which we believe can serve as an antidote to Terminator Management. It's about a model and an approach that we call HumanSigma."

Many of those who read this brief commentary have seen the second Arnold Schwarzenegger film in which the Terminator acknowledges to John O'Connor (portrayed by Edward Furlong) that he has been programmed not to think. Fleming and Asplund suggest that is also true of a common management style, "an institutional mind-set that views people - customers and employees - as a necessary evil, a nuisance, or in extreme cases, as adversaries in doing business. Rather than viewing people as the reason a business exists, the Terminator School of Management views them as impediments to business that breed inefficiency, cost, and errors."

They offer HumanSigma as an alternative, indeed an antidote to that mind-set. They characterize it as a "map of the terrain" within which employee-customer encounters occur. They recommend five "new rules" that are best revealed within the narrative, in context. These rules have been validated by studies of 10 million customers and 10 million customers around the globe. They note that a recent Gallup study of 89 companies showed that the companies that built a critical mass of engaged employees grew earnings per share at 2.6 times the rate of low-engagement companies. Fleming and Asplund's conclude their book with the assertion that people who own their improvement makes them "more innovative, productive, and confident. Are there a better set of characteristics for companies facing an unknown future? We think not, and millions of employees and customers agree." As do I.

Those who share my high regard for this book are urged to check out Paul Spiegelman's Why Is Everyone Smiling? The Secret Behind Passion, Productivity, and Profit.

You have heard several business leaders say something along the lines of "people are our greatest assets". But from an accounting and financial perspective, more focus is given to tangible assets that are easier to put into metrics than to intangible things like the contributions of humans. This model was alright for the industrial age, in which approaches such as TQM and Six Sigma (and their emphasis on materials and processes that behaved predictably) resulted in improved production. However, over the last few decades the center of gravity of business has gradually shifted from a manufacturing economy to a service economy. For sales and service firms, value creation is dependent upon human interactions (between employees and customers) that are not as consistent and predictable as materials and processes.
HumanSigma is a model and approach that will transform the way you think about your company's employees and customers, and the interaction between them. The concepts in this book are drawn from research involving over 10 million employees and 10 million customers across the globe. This book presents an alternative to what the authors call "Terminator Management", in which customers and employees are considered a necessary evil of doing business. Through five new rules, examples, case studies and research drawn from a variety of sources, the authors explain how to improve the performance of human assets. This book will help you think of employees as assets to be optimized, instead of costs to be minimized.
Like many other Gallup books, this book links employee and customer engagement to financial indicators. However, you would need the help of Gallup for advanced tasks, like determining the HumanSigma score (a number that "summarizes the overall effectiveness of the employee-customer encounter that is reliably related to that unit's overall financial vitality") at a local unit level. That said, this book contains great concepts that will be valuable to all leaders and managers. I also recommend two other Gallup books - First, Break All the Rules: What the World's Greatest Managers Do Differently and 12: The Elements of Great Managing.

I am a Doctoral student studing Strategic Leadership. This book is a great resource for people leading campaigns to improve and increase their business's effectiveness and competitive position. By clarifying the differences between Six Sigma and Human Sigma considerable effort can be saved by focusing resources to affect positive outcomes. Gallup's research
builds a solid foundation that challenges the old tenants of usefulness
about customer satisfaction and surveys. This is a fairly thin slice of the process of building out strengths based organizations, but an important one. You may have to read several of their other works to fully comprehend the significance of this book. The field needs a good follow up book on how to build out human sigma in organizations. Gallup saves this (the really good stuff) for their consulting practice. It is a good read. KC in Lincoln,NE.

The framing premise of this book, Human Sigma, is that there is a high correlation between customer satisfaction (and retention, referrals, profitability) and employee satisfaction. The authors, Fleming and Asplund, make an eloquent case for the point and I agree with the logic.

Human Sigma is positioned as an evolutionary development from Six Sigma, which has components of quantitative analysis as its framework. Human Sigma, too has components of quantitative calculations as its measurement tool. This book however is very light on the implementation and calculation of the quantitative measures as promulgated. The formulas are actually reflected in the eight page precursor to this book in an article by Fleming in the July - August 2005 Harvard Business Review.

The authors, perhaps in promoting their own methodology, spend a bit too much time discounting the methodology of Fred Reichheld's Net Promoter Score (The Ultimate Question).

The book is heavily annotated which is good, however, many of the supporting points for their premises are tied to singular findings from research journals. The mere fact that a research article has been written in a scholarly journal does not make a finding a fact.

Chapter 14's section on talent may be the most well-written and significant portion of the book and likely deserves further analysis and development by the authors; maybe even an additional book. It builds on the premises of other Gallup writers ( Marcus Buckingham, Tom Rath) on the importance of focusing on further developing existing strengths as opposed to weaknesses.

What is next necessary from these authors is an implementation book that will encompass the mathematics of their well researched theories, as not all businesses will be likely able to afford the consulting services of the Gallup organization. I will buy and read the next book.

Human Sigma: Managing the Employee-Customer Encounter is a great addition to the growing collection of books about improving employee or customer engagement. While much of the writing on this topic is based on the edgy experiences or best practices of an innovative company, this is a book based on extensive survey work. These findings provide some of the missing foundational understandings that will help you explain why this is the path to take.

While it is packed with "ah ha" insights, it is best read carefully and with full attention. This is not a quick read. While some of the concepts leap off the page and find easy application, others will take a little bit more digging to really understand. Because each chapter builds on the foundation, there's no skimming.

With that, I found it a great companion to last year's Peak: How Great Companies Get Their Mojo from Maslow. The two taken together will provide the science and the practical application needed to build an organization that encourages employees to engage and customers to become passionate advocates.

This book takes an interesting approach to customer and employee relations. Just as Six Sigma is about building in quality and eliminating waste rather than trying to fix mistakes, HumanSigma (as they spell the term) is about understanding what makes people tick and redesigning your products and processes to create emotionally attached customers and employees. The traditional JDS (Just Don't Suck) approach to management is simply not competitive enough. The response many companies take when they view employees as the source or error is what the authors call the "Terminator" style of management. You get rid of the people and leave the machines. But do people really love and develop an attachment to computers, software, and automated processes?

People are all about feelings. You won't overcome them with abstractions or even cold reason. The authors bring their years of expertise and the vast resources of Gallup to this book. Their insights are helpful and the prescriptions make sense. For example, businesses understand they value of the customers who are passionate advocates on their behalf. Most don't know how to create them. You can't get there in one giant leap. You have to build layers of attachment. First, you create confidence. Next you allow them to believe in the integrity of your brands and your business. As you keep fulfilling customer needs, wishes, and hopes they will feel pride in using your goods and services. The final level is passionate commitment. You create this layer upon layer, transaction after transaction, and by reaching out to your customers as people, not mere transactions.

Employee commitment is built in similar ways. The authors show you how to create and measure your HumanSigma score. They warn you off the trap of trying to manage your average score. Rather, you should look at the score by location because you will then be able to see the pockets of high variation. You can work to bring those up to par rather than wasting energy on moving scores in other locations that are already performing well.

The book also provides guidance on how to measure HumanSigma and how to manage it. And here is my one concern about the book. Really, in the final analysis, you won't be able to really do this on your own. The book is in some way a sales brochure. Yes, they provide real insight and good advice, but you really are going to need professional consulting to pull it off right.

So, it is up to you.

Reviewed by Craig Matteson, Ann Arbor, MI

HumanSigma is about what drives people and changing your processes to create emotionally attached customers and employees. The JDS (Just Don't Suck) approach is not enough. The actions many companies take when they view employees as the source of error is called the "Terminator" style of management. You get rid of the people and leave the machines. But people don't develop an attachment to computers and automated processes.

People are all about feelings. Businesses understand the value of the customers who are passionate advocates on their behalf. Most don't know how to create them. You can't get there in one giant leap. You have to build loyalty & create confidence. You must get them to believe in the integrity of your hospital. As you keep fulfilling customer needs, wishes, and hopes they will feel pride in using your goods and services. A customer's PERCEPTION IS REALITY for them. They are not "impartial spectators", but are driven by their hearts. You create passionate commitment layer upon layer, transaction after transaction, and by reaching out to your customers as people, not mere transactions. Customers make their decisions based on perceived value. I know that I will pay more for something if I believe there is worth in it, even if it costs more. It's not always about cost.

Employee commitment is similar. We need to create and measure our HumanSigma score. We shouldn't fall into the trap of trying to manage our average score. Rather, we should look at the score by location because we will then be able to see the pockets of high variation. We can work to bring those up to par rather than wasting energy on moving scores in other locations that are already performing well.

The book also provides guidance on how to measure HumanSigma and how to manage it. We need to create emotional attachment shown in the pyramid on page 97. We need to strive to fulfill all four tiers. We must also create employee engagement as shown in the pyramid on page 161. It's neat how the levels relate to the questions on the Gallup survey.

I liked best the analogy about the river. You never step into the same river twice. Customers and employees either become more engaged or less engaged with every interaction. Just as a river changes second by second we have the priveledge of interacting moment by moment with our customers and employees. It is up to each and every one of us as to whether engagement improves or declines.

We MUST embrace and cultivate the "Whole Person" not just a "Pair of hands". Our biggest strength is the people that make our hospital great.

This is a must read,
Tom

This is a worth while investment of time. This business book is better than most as it presents a common sense approach anyone could actually apply.

As a former chief marketing officer for businesses at Morgan Stanley and Charles Schwab, I have closely followed Gallup's work on employee and customer engagement. It had a profound impact on my thinking when I wrote Fired Up or Burned Out: How to Reignite Your Team's Passion, Creativity, and Productivity. This book lays out a compelling case for the importance of emotional connections among human beings in the marketplace. It is simply a must read for marketing professionals and anyone who is responsible for leading individuals who interact with customers.

While I agree with the reviewers who cited this book's fascinating stories and compelling insights, ultimately I was disappointed because it promised but did not deliver actionable advice on how to employ Human Sigma. I felt like the kid in "A Christmas Story" whose secret decoder ring helps him unscramble the message "Drink more Ovaltine."