PHOENIX–Dedicated to fixing problems at your credit union? That in itself may be the problem.
Instead, the credit union would be wiser to invest in moments for members, which not only makes members happier, it pays off for the credit union, as well, according to a professor at Stanford.
“We all do these customer journey maps and try to solve the problems,” said Chip Heath of the Stanford Graduate School of Business. “My concern is if we’re trying to fix all of the problems, is that really viable? And is that the same is doing good for people? It turns out perfection is not a strategy.”
Instead, Heath argued that there are certain moments that matter more than others, and by doing better during those moments the credit union will do much better.
Wait, Who’s Number Two?
As an example of how moments can matter, Heath cited the number-two-rated hotel in Los Angeles, according to TripAdvisor. Squeezed between the properties that would be expected to make the list, Beverly Hills Hilton and the Four Seasons Hotel, is the Magic Castle Hotel, which looks a lot like a Los Angeles apartment complex, because it used to be one.
“What’s remarkable about the Magic Castle is they have systematically made moments for their guests,” said Heath. “This is an organization that takes moments seriously.”
The hotel offers a variety of snacks and sodas, all free. At its pool there is a red phone that can be called for immediate delivery of free popsicles. It offers free laundry cleaning. If a guest at check-in happens to mention a special occasion, the hotel customizes a cake and races to get it to the room.
Where to Really Focus
“If we ask, how does a company allocate time between two strategies, one to focus on the problems, the other to focus on building peaks, we find spend 80% of our time on the fixing of problems, and just 20% building peaks. That means for every hour we spend on fixing problems, we spend 15 minutes on creating peaks,” said Heath, who is co-author of the book “The Power of Moments.”
Heath cited a Forrester Survey of that asked 120,000 people for their feedback across 16 countries. What if found is that consumers/customers who are a 10 on a 1-10 scale of satisfaction spend more money on that company than the 4’s and 5’s.
“High scores buy more and talk to other people about your product,” Heath said. “For every $1 you could earn from fixing all the problems and moving them to neutral, you would earn $9 if you took the sixes, sevens, eights and nines and moved them up to 10.”
Heath proposed credit unions would be smarter to take 30 minutes of its time spent fixing problems to instead focus on building those peaks.
“Fixing problems doesn’t make people happy. Being less bad does not make you good,” he said. “The best we can do by fixing problems is a state of ‘whelmed’—not overwhelmed, not underwhelmed.”
The Power of Moments
Heath’s book focuses on what he calls the “four elements of peak moments”: Elevation, Insight, Pride and Connection.
By that he means:
- Elevation. “These are moments of intense sensory experience.”
- Insight. “These don’t have to be moments of delight; they can be sobering moments. And sometimes the insight is that we have stretched past our abilities.”
- Pride. “These are moments where we set out to tackle a challenge and we managed to tackle it.”
- Connection. “This is something you care about a lot. You have members you want to connect with.”