Devoted to Managers and those that seek to improve their management skills

The time when we have the greatest illusions and delusions concerning the success of our businesses is when we are the most successful.

I remember when I was a money manager, I would always talk to people about the time to be most careful of your investments was during the time they had the most money. The same is true in business when things are the busiest.

Here's what one writer recently said concerning the booming southwest Florida area:

"A customer should expect good service. The problem is that our local economy is too big to fail. There is so much business that customers are ignored."

They are so busy and there is so much demand that they are failing to serve the customer. Isn't this a good problem to have? No it's not. Here's why:

Probably the major reason is the habits it produces. I tried to get a company to slightly increase its workforce one time because it was booming in business. The problem was they had a mathematical formula they applied to payroll versus gross sales etc. What it did was measure the past rather than the present. So in times when overall business was slower, the measurements would come in and the call would be made to cut back hours.

What always resulted was there would be an overlap period of time where business would increase tremendously and their response was from three weeks to a month behind the time when new employees or increased hours were needed to meet the needs. The result was furious customers walking out with literally losses of thousands of dollars each (it was a big box home improvement store). They never got it.

This happened once every quarter. So between two to three months out of the year they were understaffed and losing hundreds of thousands of dollars as a result. This was only at one store of hundreds, with each one operating in the same manner.

The other problem was that in these times workers learned all sorts of habits and survival strategies to do the least for a customer so that they could help the most numbers of customers. They actually cared about the customer and did the best they could to help them.

Guess what happened in the long-term? The same habits they developed to survive the onslaught of customers, were the same habits they kept when hours and employees were added. The level of service offered as a whole dropped tremendously at the huge stores and has been stuck in the same cycle over and over again for years. Their stock price has been showing the results.

A company and management needs to be prepared for success and have a plan in place for busy times. You don't know how many senior managers told me that the customers will just need to learn to wait. That's almost a word for word quote. We all know that a company can't completely be staffed for every contingency, but to understaff and take the good times as a license to underserve customers is a reverse training strategy that will slowly erode your company through loss of great workers along with great customers. The result will be no longer be called success.