How to Create Sustainable Customer Excellence: The Power of an Acknowledging Leader

We have talked about the power of being seen, truly seen, as one hallmark of an exemplary customer experience. But to see, listen to, understand, and serve your customers may not be your role day-in and day-out. Perhaps you have a team that more directly interacts with customers or a front-life staff whose job it is to engage who comes through your doors. Let’s talk about those people and how you can inspire and empower them.

While most of us intend to recognize the achievements of our team members regularly, those intentions often get lost amid the deluge of challenges and demands that we face every day. By creating effective reward and recognition programs, great leaders develop recognition excellence as a core competency within their organizations. In their book The Carrot Principle: How the Best Managers Use Recognition to Engage Their Employees, Retain Talent, and Accelerate Performance, Adrian Gostick and Chester Elton suggest, “In response to the question ‘My organization recognizes excellence,’ the organizations that scored in the lowest fourth overall had an average return on equity (ROE) of 2.4 percent, whereas those that scored in the top fourth had an average ROE of 8.7 percent. In other words, companies that most effectively recognize excellence enjoy a return that is more than triple the return of those that do so the worst.” Similarly, Gostick and Elton found that managers who were rated highest on recognizing employee contributions also typically produced the highest levels of employee satisfaction, employee retention, and even customer satisfaction.

Because of the importance of recognizing excellence, leaders at companies like Starbucks have developed a broad array of recognition and award programs.  The diversity of offerings affords a number of important teachable lessons:

  • The value of peer-to-peer recognition
  • The need to scale rewards at both the individual and team levels
  • Reliance on social aspects of recognition
  • The enterprise-wide importance of rewards

Many of the reward programs offered at Starbucks involve nominations from peers and/or direct and immediate recognition by peers.  Rather than relying only on managers or leaders to catch people who meet the criteria for recognition, the entire organization is mobilized to immediately, or through nomination, bring those acts of excellence to light.  Similarly, excellence is recognized in terms of both individual effort and team collaboration at Starbucks. In the course of my function as a professional speaker, I have attended a large number of sales conferences, award banquets, and even service recognition events. It is rare to see awards provided to groups at these events.  While individual awards can foster healthy competition within an organization, they can also undermine collaboration. Balancing individual and team recognition allows both independent and interdependent excellence to be acknowledged at your company.

While some businesses get caught up in high-cost extrinsic rewards and bonuses, most of the awards offered at companies like Starbucks do not involve items with substantial tangible value – think pins, handwritten notes, or certificates to acknowledge their achievement. (For more on this check out my latest book Leading the Starbucks Way). Consistent with trends in social psychological research showing that extrinsic rewards can extinguish intrinsic motivation, the emphasis at of great leaders is much less on prizes and much more on acknowledgment.  As it turns out, it is not just customers who need to be truly seen.

Go forth and provide uplifting moments for those who uplift your customers!

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Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies.

Follow on Twitter: @josephmichelli

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