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OfferZen Updates: MERGE Presentation: Roland Naidoo on Breaking Mental Models
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MERGE Presentation: Roland Naidoo on Breaking Mental Models

17 January 2020, by Candice Grobler

We tend to assume that the way we do things now will continue to work in the future - even as contexts and environments change. But, by holding this assumption, we could end up stifling innovation geared at changing the status quo.

In his talk, Roland Naidoo unpacks the mental models that commonly hold us back, dive into why it’s important to constantly evaluate them, and then share some of the tactics that MultiChoice uses to counter them.


Presentation transcript

Roland Naidoo:

[00:09] So, ladies and gentlemen, this is a circle and you probably can’t see it. Don’t tell me you see Pac-Man, that means you’re over 40. The reason you can’t see it is because your mental model is telling you there is no circle. A mental model is something that makes you act, see and do just about everything, right? Everything that you perceive is a mental model. About a year ago, I was talking at a conference just like this one, and I was speaking on customer experience and this gentleman came up to me in the break and he said to me, “Everything you’ve just said is nonsense, but…” And you know when somebody goes “but” it’s going to be a doozy. He said, “I have this book and Steve says you’re wrong. On page 160, based on what he’s saying in that exact book, you’ve just said some nonsense.” So, I looked at this book and it was written by one Steve Towers, the person who’s developed Outside-In methodologies for customer experience.

[01:13] So I picked up my phone and went, “Steve, hello, it’s Roland. You remember this BPM Excellence book you’ve written, you’ve been touting this customer experience thing and you’ve actually written a book on process.” He goes, “Yeah” Steve says “Chuck the book away” and he goes, “I can’t, I can’t chuck this book away!” “But why? What’s going on?” “Because I’ve built my entire department around this thing.” “Throw it away.” “But I can’t, I’ve got a book.” His mental model had told him, if I’ve got a book and it’s 500 pages long, I’ve spent 500 bucks on it and bought it on Amazon. It must be true… I can build businesses around this thing. How many of you have a book? For my sins, I was once upon a time an engineer. I’m not going to give you my CV, it’s pretty damn boring and I used to work in a town called Meyerton. Put your hand down if you know where Meyerton is, it’s not something to be proud of.

[02:27] And I used to single handedly keep the traffic department open. Three and a half, four, five grand a month on traffic fines, and I didn’t earn a lot, engineers don’t earn that much by the way. And every month, I’d be diligent about paying it, and back then you had to go to the traffic department to pay your fine. So I was doing some mileage. Meyerton is 80 kms away from Joburg and 80 kms back everyday. And the one afternoon I see this kid and he’s got this broad smile and he’s holding up a sign and you know if you’re driving past somebody holding a sign, you’re going to read it. You’re going to read it, right? And it said, ‘Traffic police ahead’. And I thought this kid has lost his bloody marbles. What’s in it for him? He was so proud of himself. So drive down four, five kms and lo and behold there’s this guy, traffic police holding his hairdryer and I slowed down, didn’t get fined on this day, thankfully. And two robots later, there’s another kid, saying tips for telling you about the traffic police. What a wonderful innovation! Don’t you agree? No CRM, no machine learning, no artificial intelligence.

[03:51] The most advanced tech there, besides my car, was a box. This is one mental model that drives me insane. Innovation is not technology. It’s not. It’s about the idea. It’s about the customer. That kid knew there was a customer need, scribbled on his box and met it. I can guarantee you he made lots of money that afternoon. No, I didn’t pay. We set up AI forums, we set up machine learning forums, we set up CRM forums, but we’ve forgotten about the customer. We’ve forgotten. We are finding problems for the solution. Can we just stop it? Just freaking stop it. And this story of not listening to our customers goes back years. Actually in the 1950s, there was a guy by the name of Ferruccio in Italy and this dude worked on a vineyard as a grape farmer, worked for his dad actually. And he was a PhD in mechanical engineering, so he built his own tractors. He was so good that he built his own tractor company. And as you do in Italy, when you were wealthy, you bought yourself a shiny red Ferrari, and Ferruccio loved his Ferrari. Loved it!

[05:25] But any good mechanical engineer would do exactly what he did next, fidgeted with the gearbox, fidgeted with the clutch, and he didn’t like this thing. He loved his car, didn’t like the clutch, didn’t like the gearbox. Am I giving you guys too much attention? Okay, I’ll go back this side. Didn’t like the gearbox, didn’t like the clutch. So he did what any good engineer would do, he tried to call Ferrari, and Ferrari did what any good corporate would do, they ignored him, and they ignored him. Until this engineer got a bee in his bonnet and thought, I’m going to call the godfather of Ferrari himself, Enzo Ferrari. Hey you know your cars! And Enzo did exactly what the company did. He ignored him. So, after a while, this pesky engineer got a meeting with Enzo Ferrari. Enzo called him to the office and Ferruccio waited an hour, two hours, nine hours he waited in the lobby for Enzo Ferrari. Eventually, he ends up calling him upstairs and they had a conversation across the table. But you know Enzo is not listening to this young man and he said to him, “Young man, if you know so much about building sports cars, why don’t you go and build one yourself?”

[06:54] That afternoon, that’s exactly what Dr. Ferruccio Lamborghini did. If Enzo had listened to him, that thing wouldn’t exist today. By not listening to his customer, he had created his biggest rival. I guarantee you all of us, including us, are currently building our own Lamborghinis. We seem to have forgotten about the guy at the end, and customers are telling you exactly what they need. This doesn’t only apply to an organisational skill or level, it applies at a departmental level as well. If you’re not listening to your internal customers, they’re building Lamborghinis themselves. Little cottage industries to replace what you should have been delivering. Here’s a novel idea, sit down and speak to them. Yeah, better can be worse. Process optimisation, making things faster, and I think Dean spoke about it earlier, is a product of the industrial age. You can literally buy software off the shelf to make things faster now. It’s commoditised, absolutely commoditised. When I joined MultiChoice, I was set the task, my CEO literally said to me, “Help us make the call center better”.

[08:21] Who here has worked in a call centre or for a call centre or with a call centre or called a call centre? If you ever have, you’ll know the 80/20 rule in call centres: answer 80% of your calls in 20 seconds. Who knows where it comes from? I have spoken literally to 100s of call centre professionals in the last two years. Harvard, MIT, the works - nobody knows where it comes from. It comes from the 70s when AT&T literally took 20 seconds to physically connect the switchboard. We still freaking use it today, 80/20. And I can tell you, call centre professionals die by that number. So, we looked at this call centre, we made handle times faster. We trained our agents, we did everything possible to make a better call centre. But the answer wasn’t here, it was way over there, listening to our customers again. Listen to the customers! So we did something novel. We’ve got all the execs into a room and we said, “Let’s go and take some calls”, and we listened to our customers. Customers were calling about balances, where to find my programming, silly things.

[09:35] Making the call center better was just allowing the problem to happen and then fixing it later. We had to meet the problem where it started. So better can be worse. There’s going to be some brand fanatics in the room, right? So I’m going to unfairly insult you, but we know if we put the brand fanaticism aside, these three cars are exactly the same. I’m not going to tell you which one I drive. Everybody assumes it’s the freaking BMW, it’s not. But there’s only so much you can do with the GPS configuration on new sets of tires or suspensions. They’ve been staring at each other in the world’s longest beauty contest. And Subaru called them out on it. In 2008, Subaru launched a campaign that said congratulations to Mercedes and BMW for winning the beauty contest, from the world’s engine of the year. Enter Elon Musk and Tesla, he doesn’t care about what these guys are doing. He understood there was a need for eco-friendliness and performance and delivered on it and this year, he outsold Mercedes in the US, outperformed Porsche.

[10:52] Every project I’ve run, I’ve been asked, “Has somebody else done it?” I’m like, “For God’s sake, I’m innovating. Nobody else has done it, why are you looking for benchmark?” This was a difficult pill to swallow. So about… I think it was three years ago, we launched our agent assist chat bot. Launch backed by IBM Watson, this thing was perfect, great artificial intelligence, great machine learning, and it was a dismal failure. Don’t feel sorry for me. It was a dismal failure because guess what a call centre agent sees the minute he Googles artificial intelligence in the call centre? Job loss. It’s the first job that’s going to go. We didn’t get our HR BP’s in the room with us at the beginning. If we change-managed this thing, and I can tell you the day we started change managing it, it was phenomenally successful. Saving us millions every month. There’s another… Just remember this, we used to archive calls, if you work in a call centre or in customer service, we archived 22 million calls a year for five years, and we were asked to re-look at this thing. So I asked the guys, “Where does five years come from?” And somebody said, “CPA”.

[12:13] You notice how your nuts grow back into you when you hear those things: CPA, FSB. And nobody questions it, right. Nobody questions it! FSB and nobody’s going to question you. So I said, “Call the regulator, let’s ask.” So my technician (inaudible 00:12:30) picks up the phone, he goes, “Mr. Regulator, we’ve got this five year rule and we want to understand, like we want to see it in writing.” And the regulator says, “You’re nuts. I never gave you that.” It’s three years, not five, at most, and for some calls, not all. Are we being imprisoned by three letter acronyms? If you’ve got customer experience in your organisation, I’m sorry to tell you, you’re still siloed. You’ve taken processes in swim lanes, you’ve turned them this way, called it journey management and assumed the silos are gone. But your KPIs still focus on tasks, inside your department. How many KPIs here say customer? The developers will be frowning now. They’ll be upset, how can I be focused on customer? I have a department of 150 people, all of them share four KPIs, four, and all of them say customer. I run a technical department.

[13:35] Imagine a relay team with KPIs, can you imagine the disaster? Each guy must run a 100 meters, leave the bat and the other guys just go. There’s nothing about collaboration in the way we write our KPIs and our measures. Get your HR guys in the room, rewrite your KPIs. Focus them on collaboration. How many of you, and I’m sure because there’s lots of clever people in the room, have seen your ideas surface somewhere else? Somebody else’s presentation, some other company? Tell me about it in the break, I want to hear these stories, right? Why are we waiting? Tesla this year, launched Dog Mode. If you have a pet dog, cat, husband, your choice. You leave it in the car, switch on Dog Mode and the car takes care of it - including the humidity and it will tell you when your pet is under stress. It wasn’t perfect, but it’s in market. By the way, Mercedes will have this in eight years time because their development cycle is eight years. You switch the Tesla on tomorrow and it’s a new car. Who’s seen that Cybertruck? That unholy creation! This offspring between the truck, from blade runner and the DeLorean from Back to the Future.

[15:03] It is fugly, but I so badly want one. When Elon launched it, it broke and five minutes later, he had 200,000 orders. I’m not saying release faulty breaks into the market, that is not great customer experience, that is death and your customers probably won’t enjoy it. But if you’ve got an idea and you want to test it, test it with your customers, your most important research subject. We ran a project four years ago called Project Paperclip. It was named after an investment banker’s project some years ago where he took all the paperclips out of his organisation. British Airways did the same thing with olives if you guys remember, it saves millions. The mental model here is that we think it’s one big thing that’s going to save us. It’s lots of little things that make up the spaghetti of your organisation. We literally found every customer need, every pain point and remove them and we’re still doing them. We’re not perfect, we make mistakes, but we’re still doing it. This project alone in the last four years, has realised close to half a billion rand in avoided costs. Guess how much they gave me? Paperclips matter. It’s not the silver bullet. Dean touched on this one earlier. Profit is an output, not an outcome.

[16:39] If you’re going to chase profit as an outcome, the only lever you’re going to pull is cost because you can’t control the revenue. Your people come first. Give them a purpose and relentlessly focus on that purpose. Six months ago, one of my technicians, Rodney, calls me, he says, “Boss,” I said, “I don’t like to be called boss.” He said, “Okay, boss, I want to tell you something,” I’m like, “Okay, tell me Rodney.” “There’s a lady outside my house, she’s carrying her bags, she’s always outside, but today she’s with bags and she said to me, she needs to go to Mpumalanga, but I don’t know how to get her there.” I’m like, “Okay, can you move on because I’m at work,” he goes, “I’m calling you from Mpumalanga.” I’m like, “Okay” I didn’t know what to do about this. He says, “Okay, but I’ll be back at work tomorrow,” I’m like, “Okay, cool.” He said to me, if I didn’t do that, I wouldn’t be living up to the purpose we, as a department, created.

[17:38] And our purpose internally, is changing the norm for a better future. This same Rodney gave me four, four weekends without claiming overtime. I’m going to rush because the cardboard is saying one minute. Focus on your people. The finance guys are probably thinking, this is some new age fluffy stuff, right? And you can spot them. I won’t call on you, don’t worry. Just in my department, in the last year, from leading with purpose, we’ve dropped head count by 30%. Naturally. We’ve increased our scope by 700% and we’ve doubled our output. Tell me that’s fluffy. Our sick leave has halved. All right, there’s a road sign near my office that I swear is trying to kill me. I swear this thing is trying to kill me. It tells me where to turn into my parking every day. It’s perfect. The sign is perfect. Its bright blue, square, rooted in the ground for the last five years. Should I… Yeah. Rooted in the ground for the last five years.

[18:59] But every time I drive up to it, I can’t see the oncoming traffic. I can guarantee you some guy UAT’d this thing, but who tested the customer experience? Probably the first guy who nearly died. Test all your solutions with your customers. I’m not going to re-read all of this because the cardboard is going to chase me soon. I want to get back to the circle. How many of you see the circle? What do you see? Triangle? I heard triangle. No matter how much I tell you this, you’re still going to see a triangle. There’s no triangle. A triangle is three sides with three internal angles and your optic nerve is telling your brain that’s a triangle. So every time you think you see the triangle, every time you think you know the answer, can you please pause yourself? Just pause yourself and go the other way instead. Thanks!

NOTE: The questions for this presentation were not transcribed, they start at 20:10.


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