Losing Your Cherry and Nominal Value

Hands up who does their grocery shopping online? Now keep your hands up if you’ve ever taken delivery of an item that has left you scratching your head? That’s all of you then.

lonesome cherry

 

 

This delivery though, has a special beauty to it. Yep, that photo is a solitary cherry, bagged, tagged and shipped to a friend’s door for 11p.

That’s 1 (one) cherry.

On its own.

Should it have had a special presentation box?

Remember The Two Ronnies’ sketch about four candles? That’s online shopping in a nutshell. That’s a coconut shell of course, but feel free to substitute a walnut if coconut isn’t available.

Now, I’m sure you have already realised that the recipient of this delivery was not expecting a lonesome cherry; they thought they had ordered one pack. So how do organisations fail to understand what it is that their customers need from them in such spectacular style? Understanding what your customer needs from you is the basic requirement of any service provider. We call this the customer’s “nominal value”. Why then, do so many organisations fail so badly to achieve what seems so utterly straightforward?

You see, it’s very easy to miscommunicate.

Remember when High Streets used to contain a Greengrocer? How often did the Greengrocer mistakenly hand over 1 cherry, 2 strawberries, or a tonne of melons? Of course they didn’t, because they are human beings, who can sense-check what they are selling you. A shopping list is a pretty straightforward transaction, that should be easily understood and because you are shopping face-to-face, it is highly unlikely to go wrong. However, modern society demands that those transactions are now completed via a series of keystrokes or screen swipes and human to human communication is not to be trusted. What is easily lost though, is the customer’s nominal value.

Senior management prefer computers to people because they don’t need HR support and are cheap. Apparently, they also remove the possibility of human error, which brings me back to my lost cherries. You see, the computer knew perfectly well that 1 (one) was a correct number. It was a proper number that met the criteria needed for that cell. It wasn’t a letter by mistake, nor was it a “!” or a “#”. Brilliant! What can go wrong? Quite a lot, as it transpired. You see, a human knows that I don’t want to order just the one. A human knows what customers need and can check what they are processing against expected norms. We have instincts and gut feel. We have common sense. Humans understand nominal value, computers do not.

Which brings me to the next link in this transactional chain; the person who picks the order for the online grocer. Working their way down my friend’s shopping list and merrily picking various tins and packets off the shelf, what did they think when they saw the order for the lonesome cherry? What would you do?

a. Presume it must be right, because the computer said so

b. Laugh until your sides ache, then gather all of your colleagues around for the ceremonial weighing of the solitary cherry

c. Know it was wrong and want to change it, but you can’t because you’re under pressure to complete each order within a target time and your manager has told you not to ask questions and just pick the orders.

Whatever the reason, the single cherry is a great example of the fundamental problem of transacting with a customer that you cannot see or talk to and yet the world is obsessed with making all sales transactions this way. If it isn’t on line, it’s the supermarket checkout, the bank cashier, the post office counter and the doctor’s reception. Now don’t get me wrong, some transactions lend themselves to computerised tills and on-line shopping and our world is a better place because of it. But, but, but, it’s all to easy to get it horribly wrong.

Humans are actually pretty good at dealing with customers, as they tend to be human too. Rather than rushing to replace humans with machines, why not try providing front line staff with the authority and ability to deal with the complexities of customer demand? It’s radical, but why train them and allow them to make decisions that help the customer?

What may surprise you is that it’s often cheaper that way. Humans may be more costly to employ than machines, but cost is in the end to end flow of work. A costly human getting supply right first time will generate a lower end to end cost than a “cheap” IT system that fails to accurately process demand. Universal Credit is doomed to failure for this very reason. In fact, Universal Credit will be firing out the benefits equivalent of solitary cherries all over the country and that’s a bit more serious than losing your cherry in amongst the weekly shop.

3 comments on “Losing Your Cherry and Nominal Value

  1. Tim Richards on said:

    Ian, always enjoy your blogs, they get you thinking.

    I would agree with both of your sentiments above 1. How the user interace & E2E fulfilment can let custs down & 2. People should be able to choose how they interact with orgs (of course in the Private Sector they can vote with their feet) to get value created.

    I just don’t agree with the context, I feel you are making (or implying) a black & white statement that ‘automated’ is wrong, human interaction is right. To go back to your statement of Nominal value, which Taguchi used to express the cost of not getting things right. We in service have taken that a step further by using it as a method for helping us understand that it’s the Cust who sets the NV (and rightly so).

    It is mine & many other people’s NV to fulfill their grocery shopping online (as with banking, general shopping etc.) because I don’t want to spend hours in a packed supermarket in a already busy work/social calendar. My issue is when they don’t deliver against the NV (I can do it remote, simply & it’s fulfilled properly) not that a human isn’t involved – if you made me visit a human, I will shop elsewhere.

    Of course some people would ‘choose’ the human experience & I do so for many things. This is typically characterised by the complexity of the service offering from the custs point of view (which forms part of the NV).

    The key here is to understand the range of NV’s you have & deliver against them, if not you will lose money (profit) or do a disservice to vulnerable people (UC)…the proof is in the data.

    You are spot on re UC & automation, it will be a disaster but that’s due to a focus on unit cost not value creation (of course from the Govt’s point of view benefits is all cost, which is true-ish but dumb!)

    Keep blogging !

    Tim

  2. ThinkPurpose on said:

    About ten years ago I got something odd in my shopping from Asda, something I hadn’t ordered: a name for my unborn baby. We couldn’t think of a male name, but had Lucy for a girl, but TIME WAS TICKING.
    Then one day in my shopping they delivered a bag of boring looking salad, with a sticker on for someone called ‘Benjamin’.
    Nominal value exceeded on that occasion.

    • Now that’s service! Understanding your customer’s demand before they’ve even told you about it is quite a skill.
      If I was being critical, I’d say they pushed supply at you, rather than you pulling value from the system, but that’s a little harsh :-)
      I’m tempted to ask whether it would’ve made any difference if the label had been on a pack of raw meat, or a bottle of red?

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