It’s a service-driven world. The vast majority of the global workforce provides services. We rely on them; every day, we engage with any number of value-based services, from airlines and banks to retail, hotels and restaurants, and even healthcare. Service is everybody’s business, says Len Schlesinger, a pioneer in services management and one of the first to recognize and define the service economy evolution.
This big, complex service economy is facing dramatic changes, fueled by technology, globalization and omnichannel customer interactions. So how can companies design a strategy to compete? On the surface, it seems simple: make employees happy, who in turn make customers happy, who in turn give you more business and boost your top and bottom line.
But this breakthrough services “trifecta” – high quality, high value, high return – is something only a few special organizations simultaneously achieve, explains Schlesinger, who co-authored with fellow Harvard Business School Professors Jim Heskett and Earl Sasser, the industry’s landmark books, “The Service Profit Chain” (1997) and “The Value Profit Chain” (2010). The success of Southwest Airlines, J.W. Marriott, Nordstrom, Starbucks, Wegmans, Zappos and others starts and centers on one critical component: great leadership.
Drawing on their combined lifetimes of academic and operating experiences, the trio of renowned service firm experts digs deep into the secret sauce of services leadership in their latest book, “What Great Service Leaders Know and Do: Creating Breakthroughs in Service Firms” (2015). In it, Schlesinger, who served nearly 15 years at the helm of several influential institutions, including Babson College, Limited Brands and Au Bon Pain, and his colleagues reflect on and test their work of the last 30-plus years, confirming their theories are just as relevant and indispensable today as they were decades ago.
“The basic relationships between employees, customers and financial results – in that order – still hold true,” explains Schlesinger in a recent Q&A published on Forbes’ leadership channel. “But a great deal of research over the past 20 years or so has put a lot of meat on those bones… we’ve come to learn more about creating the high-trust environment that leads to engaged employees who provide exceptional service that makes customers come back for more.”
Entire service businesses have been built around the ideas of Schlesinger, Heskett and Sasser. Their new book is praised as a go-to guide service leaders will rely on for years to come, covering every aspect of optimal service leadership: the best hiring, training and workplace organization practices; the creation of operating strategies around areas such as facility design, capacity planning, queue management; the use – and misuse – of technology in delivering top-level service, and practices that can transform loyal customers into “owners.”
The future of the services economy is uncertain. But Schlesinger knows this for sure: leadership will continue to be its greatest competitive advantage.