The Key to Value Creation: Your Frontline Employees With Rory Sutherland
We live in the age of automation. Need groceries? Hop through the self check-out. Need help booking your flight online? Chat to Bella, the automated bot. Thirsty? There’s even such a thing as a Bionic Bar…
And it makes sense, right? Cut the cost of paying your frontline team, replace them with fully functioning automated machines and watch the profit margins grow.
Not so fast.
Rory Sutherland, Vice Chairman of the Ogilvy & Mather Group (one of the largest and most renowned advertising agencies in the world) and official guest of the AskNicely Frontline Summit thinks otherwise. He sees the Silicon Valley approach that views humans as a ‘bug in the system’ both dangerous and fatal to business.
“The standard model sees humans now as a cost, not as a co-creator of value in the system. And this I think is really, really dangerous and fatal.”
In order to understand Rory’s argument, let’s first take a look at why people (particularly in Silicon valley) are attempting to meet economic ends with minimum use of humanity. Two obvious reasons come to mind -- efficiency and cost cutting. Economics and most businesses define value in a functional way, therefore, success is measured through numerical values -- dollars, kilograms, seconds and miles per gallon. Top executives base their decision-making on algorithms, data-driven predictions and formulas that fit neatly onto a spreadsheet.
But there's a fatal flaw to this approach - human metrics can’t fit on a spreadsheet.
This numerical based approach is particularly fatal, when you’re looking at businesses with frontline teams. Rory uses the example of a doorman to explain…
If we look at a doorman’s role in a functional way, his role is simply to, you guessed it, open the door. At the end of the quarter, when the top executives are analyzing that golden spreadsheet, they see they’re paying say, $50,000 per year to their doorman. “Automatic doors”, suggests one genius exec. And so, Jeff, the doorman is replaced. The initial cost of the automatic door is soon paid off and the hotel saves $50K a year... at least that is what the spreadsheet tells them.
What the spreadsheet doesn’t tell them, is that Jeff’s role is not just about opening the door. Not only is his role about guest recognition, hailing taxis and offering security, but at the core, his role is to say, face-to-face, as a human, “It’s good to see you again, Bob”. His role is about forming relationships with guests, helping them, providing a service to them. A service that an automatic glass door, no matter how hard it tries, simply cannot provide.
Not only does the hotel lose out on the human component that all service-based businesses compete on, but the hotel suddenly finds itself slipping down the ranks, unable to charge the rates they once did.
Rory argues that in service based industries where you’re competing on human experience, devaluing, or worse replacing your frontline employees is a sure fire way to lose. While automation may lead to short-term cost cutting, it inevitably leads to long term value and reputation depletion. The ultimate key to value creation is in the hands of your frontline team.
Rory is certain that, “The way in which we respond to an experience is fundamentally mediated by the person who delivers it. And that person is not a cost, they’re part of the whole value creation process”.
This very idea is reinforced in the case study looking at which metrics best coincided with people’s love for the brand of the Royal Mail in the UK. The results? People wished their postman was a robot. Kidding. The single best predictor of someone’s attitude to the Royal Mail, by a long shot was whether they liked their postman.
Think about it, if the man who installs your internet is a complete legend, your perception of the brand he represents is heightened. You go on to sing their praises. Human connection matters, it just happens to be the least susceptible to numerical quantification.
So what does this all mean?
Well, in short, it means your frontline employees are the key to creating value in your business.
It means we should value, invest, coach and pay our frontline workers more. This has become particularly apparent during the coronavirus crisis, where senior executives are finally waking up to the importance of the role that frontline workers play.
At AskNicely, our mission is to make frontline work more awesome. Like Rory, we think the experience and value they create is irreplaceable. That's what inspired the creation of AskNicely's experience management platform that connects real-time customer feedback with your team. Unlike conventional survey platforms that just deliver stats to the C-suite, AskNicely delivers a personalized coaching conversation for every frontline worker, everyday.
Rory rounds up his presentation at the Frontline Summit with a quote from Einstein that we’ll leave you with today…
“Not everything that can be counted counts and not everything that counts can be counted...”
Our advice? Make sure your frontline employees know how much they count! For inspiring employee engagement activities, watch this exclusive video interview with Laurie Reuttimann.