Best Practice is Not Good Enough
Many organizations are eager to learn and implement best practices. However, simply trying to replicate what works in another organization is bad practice. Wal-Mart’s much-publicized $1.85 billon mistake is a timely reminder.
Project Impact was launched in 2008 to de-clutter stores and reduce inventory in “a drive to make Wal-Mart look more like Target”. Led by a former Target veteran who has since left Wal-Mart too, the initiative cost an estimated $1.85 billion in lost revenue. Millions were also spent on remodeling stores that are now doing a U-turn and re-introducing ‘clutter’.
So, what went wrong?
Wal-Mart’s previously packed and messy stores created the perception of ‘good deals’ and ‘better value’. While shoppers enjoy clean aisles, they also associate it with more ‘expensive’ shopping. Wal-Mart tried to adopt Target’s best practice by stepping up a key perception point (clean aisles) to “hang on to Target shoppers who traded down to Wal-Mart during the recession”.
Unfortunately, this effort to copy Target inadvertently – and negatively – affected the perception of ‘best value for money’ that Wal-Mart’s core customers strongly associate with the retail giant. And the reduced number of available brands as a result of lower inventories affected another key attribute customers value about Wal-Mart – its wide selection.
So, what’s the important lesson here?
Learning from best practice is admirable, but blindly implementing someone else’s best practice may not be right for you. When you seek to upgrade your service to customers, you need to consider improvements in the context of what your customers value most.
For organizations seeking to build an Uplifting Service Culture, you need to think even more carefully about what your customers, your team, your partners and your community really value. Disney built a great service culture for family fun and entertainment. The Ritz Carlton maintains an impeccable culture for high end hospitality. And Zappos is ideal for online shoes and apparel.
But that doesn’t mean their best-practices are the right practices for you.
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