Great service doesn't come from laying down lots of rules
If you can keep your customers happy and engaged long after the first sale has been reached, you’ll gain their loyalty and develop more business with them - far easier (and more cost effective) than sourcing and selling to new customers.
For one of the UK’s most successful family-run businesses, Timpson, the key to great customer service is their staff. In fact their strap line is, Great Service by Great People.
The business, which offers a diverse range of services, including shoe repairs, key cutting, watch repairs, dry cleaning, mobile phone and iPad repairs and photo development, trades from 1,850 shops employing 5,200 people – with around 10 per cent of the workforce being recruited directly from prisons.
Transactions are low value, yet the company’s annual turnover is in excess of £250M.
Timpson has been in business since 1865 and CEO James Timpson attributes its success, in the main, to their “superstar colleagues and unique ‘upside-down management’ approach.” He explains: “Those colleagues who are customer facing and tasked with amazing customers on a daily basis are the most important; and for others who work behind the scenes, it’s their job to amaze the shop colleagues.”
The Upside-Down Management Approach
James Timpson’s father John, who used to run the business, was responsible for introducing Upside-Down Management into the business. In a recent column he writes for the Daily Telegraph, he explains how it came about and the initial problems he had getting it accepted by his employees.
Q. I read your recent interview with the BBC, where you mentioned Timpson’s 'upside down management' approach, but what is it and could a smaller business benefit?
A Our upside down way of management, which has become central to the culture of our business, started about 20 years ago, when we discovered the secret behind great customer service.
The secret is both obvious and simple: you can't create a great service culture by laying down lots of rules, running training courses or inventing a code of service. The only way is to trust frontline colleagues with the freedom to serve customers in the way they know best.
I was managing director for more than 20 years before I made this dramatic change to our management style.
I should have discovered the secret three years earlier, when I read
The Nordstrom Way, a book about the American chain of department stores, which built its service reputation by giving sales clerks the freedom to – often literally – go the extra mile to serve their customers.
In the middle of that book is a management chart that’s upside down. Sales assistants are at the top, trusted to use their initiative to give customers the best possible service. The chief executive is at the bottom of the chart. He or she, like every other manager, is there to support the people who make the money by serving customers.
Once I realised that this is the right way to run a business, I was on a mission – in 1996, I spent weeks touring the business, explaining how and why our branch colleagues were to be given the freedom to do things their way. I scrapped our old rules and replaced them with just two: 1) look the part; 2) put the money in the till.
I even put up a signed statement in every shop, stating that colleagues had my total trust. But I failed; despite my campaign, nothing really changed. No one believed that I would seriously run the business by letting people on the front line do what they wanted.
It helped when I said that anyone could spend up to £500 to settle a complaint on the spot without having to ask their boss – as it did when I told them to treat our price list as a guide. Colleagues have my authority to charge what they want.
But it took five years to fully establish upside down management and overcome two major obstacles that stood in the way of success.
First, it only works with the right people. We required colleagues with a positive personality. It helped as soon as we started to recruit Ms Happy, Mr Keen and Mrs Positive, and said goodbye to Mr Grumpy and Mrs Dull.
Introducing this style of management is the most important decision that we have made in the past 30 years
The other big obstacle was the middle management team, many of whom couldn't see how they could be held responsible for results if they couldn't tell their team exactly what to do.
It helped when we scrapped the term “head office” – people at what we now call “Timpson House” understand they’re there to support colleagues in the shops with help and advice, but must never issue an order.
By picking people with personality, who were free to use their initiative, we started to see a significant number of customer compliments, but things got even better when we explained that upside down management doesn't just apply to branch employees.
It applies to everyone else. Timpson middle managers are also trusted to do their job the way they want, as long as they give the same freedom to every member of their team.
Introducing this style of management is the most important decision that we've made in the past 30 years. It hasn't just been good for business; it has made a massive difference to our colleagues, who find that working in a laid back atmosphere makes their days more fun and enjoyable.
I believe that every business – big or small – can benefit by copying huge slices of our approach. If you want to know more, pop into one of our shops and ask a colleague whether it works.
But a word of warning: upside down management will only succeed with the 100pc commitment of your chief executive.