Episode: 2 |
Ravi Rao:
Emotions in Business:



Ravi Rao

Emotions in Business

Show Notes

Known for his wit, wisdom, and formerly purple hair, McKinsey alum,  author and independent management consultant Ravi Rao reveals how we can improve the performance of individuals within the corporate culture through emotional intelligence.

As a young man, Ravi wanted to be an actor but ended up in neuroscience. With a keen interest in the function and development of the brain, he obtained a PhD in neuroscience, became a resident physician in neurosurgery at Harvard, where he studied the emotional behavior of babies.

After he made a career switch to management consulting to join McKinsey & Co., he used his training in how the brain works to bring new insights to corporate culture transformation.

In our discussion, Ravi explains why the basic element of trust is behind all progressive and profitable businesses. From being open to ideas and receptive to growth,  to mitigating the loss of high-performers and enabling staff to proactively anticipate and solve problems.

Ravi talks about his process as an author for his book, Emotional Business: Inspiring Human Connectedness To Grow Earnings And The Economy: how he wrote it, published it, and how it has helped lead to further conversations.

Ravi’s got a unique morning routine that is inspired by his own neuroscience training, and he shares how he starts his day.

Ravi is on Twitter @emobizguy.

Unleashed is sponsored by Umbrex, the first global community of top-tier independent management consultants.

One weekly email with bonus materials and summaries of each new episode:

Will Bachman: Our guest today is Ravi Rao, a McKinsey alum and neuroscientist, who is the author of Emotional Business. Ravi has led sessions at several professional development events for consultants that I’ve organized and he always gets fantastic reviews and I always learn a ton from his sessions. Ravi was my guest on the second episode of this show, and it remains one of the most downloaded episodes. So, if you like this episode, go back and check out episode two.

In this episode, we talk about one really creative framework that Ravi has developed that helps you think about customer experience in a new way. I used this framework on one of my own projects right after I learned it from Ravi and the client loved it. I was really pleased that Ravi agreed to come back on the show to walk us through his framework.

So, check out the show notes for a link to download that framework and please do use it in your own work. When you do, it’d be awesome if you include a source line that credits the book, Emotional Business by Ravi Rao. It was a huge fun to spend time on the phone with Ravi and I hope you find it useful. Hey Ravi, it is awesome to have you back on the show. Welcome back.

Ravi Rao: Thank you, Will. Great to be back.

Will Bachman: Hey Ravi, so you presented a great session at Top Tier New York in June, 2017. I really loved the framework and thought it was such a great session, we talked and I thought it would be great to do a session today on going over that. It’s called the customer emotional experience. It comes from your book, Emotional Business. Maybe you could start us off by just giving us an overview of this framework that you developed.

Ravi Rao: Okay. Sure. Happy to. I think most of the time when companies, large and small, think about customer experience, they’re typically thinking about it in terms of, so what is the feedback saying. What are the evaluation forms saying if they used the metric like net promoters club, what are the numbers saying? I understand that data-driven approach is a helpful one. If we know there are complaints, we should fix those. But to limit what customer experience can be to just we have to fix the complaints, really misses a much bigger broader question that is the basis of longer term growth, which is what do you want people to feel?

Maya Angelou, who is deceased now, has a great quote that I heard her say in person 20 some years ago which has stayed with me since then, which is “People forget what you say. People forget what you do. People will never forget how you make them feel.” So, whether you’re a consultant serving clients or a mid-sized business, a boutique firm serving clients, or part of a large consulting firm, the question becomes what do you want your clients to feel? So, I’ve organized the framework that talks about the emotional experience of people when you sell them something or provide them a service.

Will Bachman: And that’s awesome. So, you’ve come up with something and a lot of people come up with something alphabetical, a nice mnemonic and you start with R. So, R through X. So, before we dive into the details of this framework, talk to me just a little bit about how you developed it.

Ravi Rao: The usual way that we think about the customer experience is typically a reaction to something. So, we usually say things like, so we got some negative comments about this attribute about a product or service or we heard someone complain about this and we try to just fix that. I actually took a step back to say, “What is actually the need of the customer?” That is, not only what is their tactical need or product need or the issue you’re trying to help them solve, but what is the emotional experience you’re trying to provide in that your action. Because if we only focus on the product or the service, we actually miss the real opportunity to deliver to the customer or to the client.

So I was trying to really get a sense of what are those emotional experiences and those came out of not only just the experience of working with clients from my own side, but watching what those clients did with their customers. Over time, I also then traced it back to what we know from neuroscience research and child development research, about the kinds of things that promote interactions that people leave those interactions feeling good about.

So, through that combination of observation, personal experience, professional experience, watching clients, those together then presented to me a fairly robust framework that allows me to say collectively, here are your options for providing great emotional experience to a customer.

Will Bachman: Awesome. Why don’t you list out each one of these elements, and then we can go through each one of them in some detail?

Ravi Rao: Sure. So from my observations and experiences and then tying it back to what we know from science, I have proposed that there are seven categories of emotional experience. Those seven, just for convenience sake, I’ve used a mnemonic technique of listing them R through X, so R, S, T, U, V, W, X. The mnemonic thing is a little bit contrived in terms of what each letter stands for, but it’s more so that we have a healthy checklist, which we can say, “Are we going to do that one? Did we miss that one? How are we doing on each one, terrible, mediocre, average, or great?

So R, S, T, U, V, W, X. R is responsiveness. S is status. T is tenderness or tender lovingness or something along those lines. U is unique customization. V is velocity. W is Wow factor. X is extra, and I know extra starts with E, but it’s just easier to remember that X is for extra.

Will Bachman: We’ll give you a pass on that one. So I really love this framework. I think it’s such an awesome tool to help think about where you want to be great because nobody can do all these things. So let’s go through one by one. So R is responsiveness. Talk to me about what responsiveness means to you.

Ravi Rao: Responsiveness. As with each of these seven, there is a spectrum, a range, a gradient by which an individual consultant, a boutique consulting firm, a large consulting firm can deliver this to people they’re working with. So, this isn’t the binary you are or you aren’t responsive. It’s more to what degree is being really at the top of this part of your service strategy, and service strategy is an a.k.a. alternate word for emotional experience.

So, if you’re thinking about responsiveness, all of us have had these situations in our daily lives. We bill something on a credit card and then we have a question about the charges that appeared on our card. We stayed at a hotel and we have a question about a charge. Or we have filed an insurance claim and we haven’t heard anything in 10 days and we’re wondering what the status of our claim is.

For organizations or consultants that say, “We really want to be known as an extremely responsive organization,” a high responsiveness, sort of best in class, would be available wherever people need you to be. That might mean 24/7 availability or accessibility. It may mean both phone and online ability to provide questions and feedback. It’s really at the emotional level saying, “We will not leave you abandoned out and feeling like, I can’t even get a hold of these guys.” Again, this is a spectrum.

On all of these, you may live with being mediocre or sort of towards the bottom quartile, and that’s fine. That’s a choice. It’s probably problematic for any of these to be at the lowest 1% where you don’t even care about it. At that point, you are going to get feedback from those clients or customers who say, “You’re not responsible at all. I don’t want to continue to work with you or purchase your service.” But at the high end of your responsiveness, as you start getting up to that really top part of the [inaudible 00:08:49], it takes a lot more effort and investments, and it takes a transformational need that you really have to redesigned your own processes to be extremely responsive. So you figure out where you are going to be. If you’ve got some problems, do you want to go from a problem area up toward the average, or are you really trying to shoot for high levels?

We all have worked with people who seem to amazingly get back to us within an hour of any time we ever email them, and then other folks, it’s sort of in the average range where it may take a little bit, but we know we’re going to hear back. We all have somebody we know that whenever we write to them, weeks go by and they don’t reply. And so one just has to determine where you want to be in the spectrum on that one. I won’t repeat that spectrum, arguing for the others, but just as this is the first one, just describe what you’re doing is making a choice as a service provider, as a consultant, as a small business. What degree do we want to be this?

Will Bachman: This one makes me think there’s also probably different ways to be good at responsiveness, like UPS. I mean, good luck ever actually speaking to somebody on the phone, but it’s awesome where you can just go online and track your order and know, “Okay, it left the station, it’s on the way to your house,” or knowing exactly where your package is, which is such a nice kind of tool. I suppose as consultants ourselves, our responsiveness is how quickly do we respond to a text or a call or an email from a client. 

There might actually be a sort of negative marginal returns, where if you’re too responsive and respond within a minute of every email or text, it might be suggesting that you’re not doing anything else or you don’t have anything better to do. So it’s probably some kind of sweet spot of an appropriate time delay. So talk to us about S status.

Ravi Rao: Status is a very helpful emotional experience that companies provide to their customers and clients, particularly large companies love to do this. Individual consultants or small firms can also do this. And that is to say, of course, you treat everybody with respect and of course, you treat everybody according to your values and so on. 

But every business, whether independent consultant or a firm or a large company, has that 10%, 20% of their clients or customers that really are responsible for a vast majority of the actual revenues of the business. So the question becomes to retain those customers, there is an option again, all of this R through X are options. There is an option to say, “I’m going to devote time and resources and my efforts, maybe not on the responsiveness one we talked first, but on making sure that those handful of really premier award the client, your own platinum and really to give you so much business, are treated in ways that are important. Now and then, you don’t want to do something unethical or anything that violates any regulatory rules and so on, but you offer your own client something along the lines of upgrades or perks.

I’ve seen some consultants do successful things, such as for their top tier clients, to send a gift basket at the end of the year, just a fruit basket or something like that. I’ve even seen a couple of consultants, I haven’t done this myself, but create an event where they may invite a couple of their clients together, that it’s an invitation-only event where a restaurant room of 10 or 12 people, and talk about some trends or something else that you’ve seen, but it really is a perk to the client. You may have some business development aspect to it, but it’s much more of a reward to the client. 

So your question about what you’re doing yourself as a consultant, “How do I make sure I continue to work and have a good pipeline of projects and so on?” One way is to say, “Hey, these people have given me huge projects in the past on a repeated basis, I want them to know I appreciate them at sort of my [inaudible 00:12:57] customer.” And figure out ways to do that to allow them to recognize themselves like, “Wow, his pushing really values our business, creates that emotional experience of feeling special.”

Will Bachman: You know what, I love that point about gratitude, which is so much talked about and the kind of mindfulness thinking and how it’s so important not just for the recipient, but also for yourself to express gratitude. I mean, one idea there is even just writing a hand-written note to a client that has been great to work with. It’s so uncommon now to send out something hand written that that can really resonate, even aside from gifts. Although, certainly, gifts are nice as well.

Ravi Rao: Beautiful suggestion on the hand-written note, Will. I mean, that’s exactly the right kind of thing, because it takes effort to sit and write a note and put it in an envelope with postage. And for someone to receive that, it is a unique event these days, right? You get junk mail mostly, and to actually get a hand-written card from someone, that can leave a very lasting impression.

Will Bachman: I guess we’re mainly talking about our clients, but our service providers, or people that are vendors to us, showing some gratitude in that direction, too, can really mean a lot. I think I received a letter from one of my clients after a long project, telling me how much he appreciated the support and going on. And, wow, that was so meaningful. I printed it out and saved it. It was like that was such a thoughtful thing for him to do, to send me a note. It deepened my willingness to help him out, just going beyond the call of duty. So both, thinking about status for your clients, but also for the people that are on your virtual team. 

Ravi Rao: Agreed, agreed. I mean, it’s a sort of hokey way of saying it, but if you’re interactive with humans, they respond to things emotionally. So if we only think of clients or people we work with or our vendors, our virtual team, as just sort of these transactional things that there’s really no difference from the way a human has done it, or versus some kind of AI machine-learning robot is doing it, that will minimize the likelihood of that interactions and feelings that when we pause to write a hand-written note to offer some thanks or gratitude for appreciation or just underlying message that you are valuable to me, that goes a long way.

Will Bachman: So talk to me about T, tender-loving care.

Ravi Rao: Right. So I’m not suggesting with this third emotional experience around tenderness, and that you should be hugging everybody, or that there should be Kum-by-yah singing or crying together with your customers and clients. I mean, sometimes that happens, but that’s not a strategy per se. What this is saying is, “I recognize who you are as a person and not simply an organization or vendor or revenue that you represent to me.” So what does that mean one has to do differently is, one actually has to take a sophisticated emotional capability’s perspective about what you’re actually doing. Now, what does that mean? It means in part that if you took a class somewhere in college or business school about listening, and they told you there was one way to listen, and then you’re supposed to nod your head and say, “Uh-huh, I see,” and repeat things back to people. That is sort of listening 101. 

If you’re really trying to be distinctive on tenderness, that is, the human emotional connection, you have to understand that there are different ways of expressing [inaudible 00:16:35]. There are different ways of listening to people, depending on circumstance. You should not listen to someone who is angry with the same style that you’re listening to someone who is confused. And learning how to adjust your listening approach. You have to get good at recognizing people’s names and people’s attributes. That is something they’re passionate about. Oh, wait, that’s Suzanne and she loves golf. Or that’s Mike, and he’s really happy to just have his first grandson. 

These kinds of things you might say, “Well, who cares. I’m a consultant and I’m here to do the Excel sheet.” They don’t look at you as the consultant who is just there to do the Excel sheet, if you start to take the service strategy, the emotional experience and saying, “Hey, I am going to do the Excel sheet, but I’m also going to reveal personal human things about me in such a way that you can feel like this is a person.” And you might say, “Well, aren’t they simply going to judge you based on your work?” Yeah, that’s probably 70, 80% of it, but it’s not 100. And I’ve seen over and over again between two choices of vendors or customers or pitches or work effort that people almost always go with not the highest quality proposal, but the reasonably good quality proposal with people who are likable, with people who are human. 

So if you’re like, “I am Mr. Very-heavily educated PhD-level analytical robot, and I calculate numbers great,” people will be like, “Mm-hmm, I see, yeah.” And the next guy comes in and says, “I’m very robust with Big Data, but I also try to understand who the people are I’m working with in order to figure out what their priorities are, and listen to their situation and really try to match what they’re asking for with what they need from me.” That almost always wins out over perhaps even the more robust, technically proficient person, who does not come across as human. 

Will Bachman: Now for some of the other R and S, I can think of companies that are great at it. Like responsiveness, I mentioned UPS, or other companies that give you online updates. I just started using this transcript, online transcript service called Rev.com, and it’s awesome, it tells you it’s in progress, it emails you when you’re done. 

Status, certainly we can think about tons of examples, particularly in travel industry, hotels, airlines, and so forth.

Ravi Rao: Sure. 

Will Bachman: Share an example of a company that is great at tender loving care, not a consultant so much, but can you think of corporate companies that you’ve dealt with that are great at tender loving care?

Ravi Rao: Sure. I mean, some of these are clients that I’ve worked with, some of these are just sort of well-known public examples, but two come right to the top of mind in terms of the approach of TLC to their service strategy on the day-to-day level with customers. From travel, I would say that Southwest Airlines has from the very beginning emphasized this idea of caring for people. For example, their flight attendants use humor in the upfront safety briefing, and they smile when you walk up to the counter in the airport. It’s actually quite dramatic that you … suddenly you’re like, “What is different about this place?” And you recognize that when you walk up to the Southwest counter in many airports, their help are smiling, as opposed to “May I help you,” in a kind of apathetic tone. So that [inaudible 00:20:17] approach runs throughout their organization. In fact, for a while Southwest … if I remember correctly, their stock symbol, particular symbol, was LUV, so that is one that I’m saying is very true that way. 

Another example of a company that is really amazing on the TLC side is the theme park and cruise lines of Disney. They have just made a very deliberate effort to make sure that each guest who comes into a park or travels with them on the cruise line understands that they are valued and cared for. And it’s just a tremendous effort and emphasis internally to make sure that each guest feels that way. And this whole idea of empathy and smiling and listening and engaging with the customer as a person receiving the service is a big part of it. 

[inaudible 00:21:20] would be another one, where when you’re interacting with people in [inaudible 00:21:20], there is a very deliberate attempt to make sure people feel a certain way. 

Carlton Hotels would be another one where their words interact with things like the emphasis on the statement, my pleasure, or with whom do I have the pleasure of speaking with today? Those kinds of emphasis on the TLC side … and you will see in each of these examples, these are not small companies that can do it because they only have eight employees, these become part of the service culture across very large [crosstalk 00:21:51].

Will Bachman: Interesting, cool. Those are great examples. Talk to me about uniqueness.

Ravi Rao: Henry Ford, over a century ago, had a comment that most consultants have heard at some point, which is, “Yes, our customers can have a car in any color they like, as long as it’s black.” There was an emphasis in the last 20 to 30 years to say we will do market share, we will improve earnings, we will grow our customer base by helping customers to see that they can get things the way they wanted to, and they don’t have to be force-fit into a package that we define. Even examples just in the marketing side of it, things like Burger King saying, “Have it your way.” One emotional experience that allows people to feel connected to a service provider, a brand, is the idea of freedom. I don’t have to worry that I may be forced into something I don’t want. 

So how does one do this operation? Being able to figure out what potential customers are we missing because we don’t have option D or option E available. How could we add additional options? That also then links into the operational back end of it, which is how to create ease of ordering systems and then back office supply chains and logistic systems to match that.

The idea of being able to say even as a service provider with their consultants or a boutique, you come in and say, “Look, I write the PowerPoint, I write the Excel sheet, I deliver it to you. Please don’t ask me to do anything else.” That’s okay, that’s a business model and you can say that. But if you decide that your emphasis should be on this customization idea, what you want to do is to say to the client and the potential customer, “This is what I know I can provide, but if there are things beyond this that you really value, let’s figure out how we can do those.” And being able to then tell people that they don’t have to worry that they’re going to buy something that they don’t really want or need.

Will Bachman: This is one where I think independent consultants actually have an advantage over much larger firms, because large firms, just their economic model is built such that it’s really difficult to get beyond the pyramid-type structure, but we can offer, oh, you want just sort of one day a week for six months, or you want someone really senior and just someone junior just a couple days a week, or we can outsource that to up work, and do part of it ourselves. We can, I think, be much more flexible and put together a team, and it can respond to what the project really needs as opposed to relying on a certain kind of engagement manager plus two model that is more convenient for the firm, but not necessarily for the client. 

Ravi Rao: Agreed. I mean it’s been to some degree, building off of what you just said, in the independent consultant realm, we all have experienced, those of us who are independent consultants, there’s [inaudible 00:24:54] approaches … we’ve all experienced the fact that the market continues to change in the last 10 to 15 years. There’s just less desire for an EM Plus Two model in a large firm, and so the question becomes what is the market chipping force. Is it more around expertise and experience? “Okay, I want someone who’s done this 10 times before.” Well, that means changing one’s model or, “Hey, look, we like the PowerPoint, but what we really need is training and coaching and telling people how to execute this.” Okay, so then we have to adapt our model down the road. It becomes much more about actually doing part of the execution on behalf of the client, and less more in the advisory role. Then we may need to adapt and figure out and customize what it is that the client potentially is asking for.

Will Bachman: Cool. So let’s talk about V, velocity.

Ravi Rao: When a customer or client is considering different vendors or different options, or when you’re working with your client to figure out how are they going to go out into the marketplace with their product or service, one of the differentiating experience is that allows … it could be any customer to feel something … is the idea of how long does it take to get to the end product. Now, earlier we talked about responsiveness, which is more about how fast are you able to get information or figure out updates or status, but we as a velocity, how long does it actually take to deliver the service? 

And speaking with a consultant at the event that you mentioned earlier, one of his offerings to clients is usually this is a three to six week type project for other firms to do, but because he has developed some proprietary software and knowledge database, he can actually get to those insights in a matter of days, as opposed to a matter of months. So for him, he’s actually creating an emotional experience with his clients to say, “Hey look, you don’t have to wait and wait and wait to see what the answer might be, we can get to a pretty reasonable answer fast.” And so the question about, “How fast can we actually get to that service delivery?” 

So, as an example, quick service restaurants, obviously, are always trying to get their time down. But so are, for example, banks and processing loan applications, insurance companies, processing, underwriting, all these kinds of things are less about the responsiveness to say, okay, you answered the email quickly, but much more about the primary product or service offering. How do we get that to be faster?

Now again, just so with all the other ones, there’s a difference between saying, “We’re ridiculously slow and losing customers. Let’s just get to an adequate level.” There is one set of acts to do that. We suddenly say, “Okay, we want to be the fastest in the industry,” that revolves and involves a hugely different set of actions and investments. So again, it cannot be all of these things at a distinctive level for everyone, but it’s picking and choosing. Okay, is that one of ours? And velocity is one that a lot of companies out there are trying to do. 

You even see the things you wouldn’t have traditionally thought about. I’ve seen a few hospital systems now say, “Be seen in our Emergency Room in under an hour,” and that’s part of their marketing. They are going after the idea that you will minimize or eliminate waits all together. You see rental car companies these days having for their elite members bypassing waiting the line at the counter, and instead looking up on a board and going straight to your vehicle. 

These are examples of where you can actually change the customer’s emotional experience of the brand by doing things in a different system or in a different process that allows them to feel that they’re fast, because there’s no waiting associated with it. 

Will Bachman: Yeah, I hate waiting. I mean, same-day delivery, next-day delivery, just the bar is getting raised by everyone. And I think it’s an interesting distinction you point about at least getting as good as the average, as you’re not falling behind, at least. Or are you trying to make the choice to be just truly distinctive at that. Let’s talk about the next one, W, or Wow factor. What does Wow mean, Ravi?

Ravi Rao: In general, we walk into any potential sales interaction, client engagement interaction, some type of agreement to do work or deliver a service with a set of expectations. But when the actual service or product or transaction even, if you will, is delivered, if it … and this is a common phrase of seeing customer service terminology out in the industry [inaudible 00:30:01], that when we take the approach of delighting the customer or amazing the customer or surprising the customer, these kinds of terminologies are a strategy. They’re to say that you know what we want? We don’t want to just sort of deliver what we said, we will say what we’re going to be doing, we’re definitely going to deliver that, but the customer will actually at some point, just gasp and say, “Wow,” if we do it really well. 

Now this can be on a product level. Where I think of examples like that are the ways in which Apple products have all these amazing features, but you actually have to Google and watch YouTube videos on even how to use because they’re so cool, but they’re so much more than you thought you would get. They’re just amazing things that are in layers upon offering. 

I’ve seen consultants where, yes, they’ll do the PowerPoint, but then they’ll also supplement that with a video that sort of captures it all. And when a client sees that, they’re like, “Oh, I had no idea we would see that.” I’ve seen a consulting firm where if they’d use a facilitation for you about their strategic planning offsite, one of the things that they will also do is to instantly take things that were captured on slip charts or whiteboard and turn them into produced PowerPoint immediately for the client while they’re still at the event, such that even before they leave the room, they already have everything captured that way. So there are all these kinds of amazing things that are beyond what one might expect. Some type of pleasure is created on different qualitative dimensions. 

I think part of this also can involve things such as unexpectedly something being more fun than people thought it would be. Or potentially some other qualitative dimension that the, “But we knew we were getting this, but we had no idea we would also get this.” And that element … again, if you have nothing interesting or fun or amazing or delighting, you just have the bread and butter service, that’s okay, that’s a strategy. But fine, you don’t have to sort of be completely innovated and just deliver something totally unexpected, that takes effort. That takes time, that takes resources to figure out what that should be and how to do it. 

But if this is a potential idea starter, a spark to think about what could we do, that would really serve the clients or customers well, this is a good option to consider. But, again, like anything, you can’t do all of these seven. If this is the one you’re going to do, great. You have to start to think out of traditional thinking and to more design thinking, out of KTI thinking and more into what is the underlying experience we want to drive. Once you get into that level and Apple is the one example I said, but there are many others in a whole way that Virgin Atlantic or JetBlue has tried to design its airline service, and the way that a variety of hotel chains have tried to surprise customers with little items in the rooms that are unexpected, and create a happy, unexpected benefit.

Will Bachman: I would add to some of your examples. One is moo.com for business cards and correspondence cards. They produce such beautiful material, but by itself, the product is nice, but when they ship it to you, the packaging is just so beautiful. It’s a real kind of sense of theater of opening it up and it’s beautifully nestled in this white box. And it just feels like you’re getting something delivered that’s a gift or a present, something extraordinary when, “Okay, it’s business cards,” but they clearly have taken the extra time to really think through that whole experience of receiving it, and aren’t just shipping you the product. 

Ravi Rao: Great example. MOO cards take that whole approach from end to end with their product and the service delivery. When you go online to moo.com, the kinds of cards you can choose are not the simple rectangles with texts in different fonts, but they have different card thickness, they have multi-layer cards, they have cards with different textures and reflective coating. Then, as you just noted, the way in which it arrives is in this beautiful package, usually … I’ve ordered MOO cards myself, and they come with a sticker on the box that says something like, prepared with great hope for you, you know, that kind of thing. It just leaves you feeling like, “Oh my gosh. Wow.” And if you can say wow for the way that a consulting firm delivers a service, that’s a really impressive thing and memorable for a client.

Will Bachman: Awesome. Talk to me a little bit about the final one, X, for extra.

Ravi Rao: Yeah, extra really is a very, very basic human need, which is the idea of proving abundance. And from the earliest elements of human civilization, scarcity drives behavior. Will we have enough food for the winter? Will we have enough to survive? And so the idea of scarcity has driven lots of our systems to say, “You know, let’s make sure we’re not getting ripped off. Let’s make sure we are getting what we’re paying for. Let’s make sure there aren’t any unnecessary charges, and can we get discounts?” Some might kind of civically argue, “Well, that’s just pricing, that’s just supply and demand.” To some degree some of that may be just supply and demand, but if you layer upon that the unfortunate situation of many customers and many industries and modern business feeling that they’ve gotten ripped off. This is the activities and statements and behaviors and messaging we use to make sure that people feel and understand they’re getting a real value here. 

Now, it isn’t to say, “Look, hey, I’m giving you an extremely high elite service, and I’m going to charge you with an enormous price tag.” That’s a different sort of value thing. This is to say, “For whatever price point there is, you’re getting more than you thought you would get.” What is the specific approach to this? A lot of retail companies use the low prices approach to say, “You get more.” But even consultants can use this. 

For example, I saw a technique from one consultant, which I really liked and I copied that, which is, at the end of the engagement … in addition to sort of the final PowerPoint … is to take the time to write out a one-page or one-and-a-half page single-spaced letter that says, “Summary of achieved progress.” So say when we began in paragraph [inaudible 00:37:20] form, here’s where we were, here was some of the attributes some of the people said, and over the course of however many weeks or months the engagement has been, here were the activities we used and then here is the progress we’ve made. And then in that, sort of the written approach, really get across the idea of like, “Hey, we actually did a lot here.” It then allows the customer, when they get the final invoice, to say, “Yeah, that’s what we paid, but look at everything we got for it.” 

So this idea of promoting what people are getting for the price they’re paying, that leaves an emotional experience and the degree to which you can do it even better helps the ratio ultimately is what’s important. This is a simple example of what every one of us goes through, if you buy a lot of things in different retail environments, now on the receipt, if you do glance through all those dozens of lines of information they print, the items and then the price and everything, they usually now say something like, “You saved $6.83 today by being a Rewards member.” That idea is one simple example, but there are many others where we start to say like, “The demonstration of what you’re getting for the price you’re paying,” gives you and emotional experience in another thought.

Will Bachman: Yeah, one of my engagement managers at McKinsey called it the Busy Bee Slide, where we would list out, here’s all the people we interviewed, here’s all the sources we used, here’s all the conferences we would do and the reports that we read, and something practical on the extra thing for consultants is … and I suppose this is maybe just everybody does this, but I typically will do, if I’m doing something with a lot of interviews, I will obviously produce appendix pages with notes from that interview. Something very simple, it’s a template with just topic on the left and then either a paraphrase or a direct quote on the right, kind of a table format. I’ll put all those in appendix and if you’re doing 40, 50 interviews, it’s 100 or 150 pages, the client might not read it, but it’s a way to say, “Here’s some backup,” and it feels like, “Wow, they really did a lot of work.” 

I wanted to share something on the Wow factor, because one of the things that you mentioned on that is that it also can involve fun or laughter, and I wanted to bring up the example of CD Baby. This is kind of an Internet name almost, but for those who haven’t ever received it or heard about it, CD Baby was, I think, bought by Amazon. 

But when it was private, the founder wrote just in 15 minutes, an email that they would send out whenever someone bought one and it says … I’ll just read it because it’s worth listening to, I think. It says, “Your CD has been gently taken from our CD Baby shelves with sterilized, contamination-free gloves, and placed onto a satin pillow. A team of 50 employees inspected your CD and polished it to make sure it was in the best possible condition before mailing. Our world-renown packaging specialist lit a local artisan candle, and a hush fell over the crowd as he put your CD into the finest gold-lined box that money can buy. We all had a wonderful celebration afterward, and the whole party marched down the street to the Post Office, where the entire town of Portland waved bon voyage to your package on its way to you in our private CD Baby jet on this day. We hope you had a wonderful time shopping at CD Baby. In commemoration, we have placed your picture on our wall as customer of the year. We’re all exhausted, but can’t wait for you to come back to cdbaby.com.”

I mean, that’s I think an example, where you don’t normally get a … I mean, they could’ve just said, “Hey, your CD has shipped.” But that’s an example of, “Wow.” So I love this framework, Ravi. Talk to me a little bit about how someone could use this framework serving a client. Let’s say you’re thinking about, “Hey, how can we …” It’s not even just “a customer experience project,” it’s really designing your whole delivery system, right? So how might someone use this framework in helping a client think about innovation or improving the service, improving the customer experience?

Ravi Rao: I, myself, have used this framework frequently as it relates to the broader business strategy. Particularly, in situations or circumstances where the organization is taking such a stark competition that it’s requiring a new and different framework for the organization to function as a whole. So I would say that there are three approaches to applying this framework. 

The first approach is that the senior executive level to ask the question if there is need be for it, of a fundamental rewrite about how in fact, the company functions. That is, what is the service offering? It may so be the product, it may so be the service, but one of these elements. The customization, for example, or the Wow factor becomes a much bigger part of the identity of the company itself. 

The second level, which is not as expansive or broad in blue sky, is to understand segmentation. So if, for example, on a project someone is asked for, if you look at different tiers of segments, different customer groups potentially, even different market, like what will the European market want? Or what will the South American market want? You can actually then say, “Okay, for this group of customers, responsiveness is critical, because they’re worried about being able to reach the insurance company about the status of the claim.” That’s what we primarily know is their driver. But for others, shopping for the same product or policy or service may in fact, have a much higher need or desire for one of the other factors, such as status, loyalty, privileges, or the Wow factor of fun.

The third approach, beyond sort of the blue sky innovation and the segmentation, is actually for individual sales people or individual consultants serving the organization to ask, “What is it that my customer wants, not sort of the segment of customers, but this individual single person standing in front of me?” There is to some degree, even as I’m sure people who are listening to this framework, a couple of them probably roll their eyes and said, “Oh my gosh, if a customer sales representative or a salesperson did something like that with me, I would never shop there again. That would just annoy me.” 

One of the important things here is to realize that humans are not identical and don’t want all seven of these thrown at us at every transaction. But if I were to say, “I, Ravi, want these two, and it makes it very hard for me to be a loyal customer unless those two are consistently in place,” that’s helpful. Or if Will, we know that these two are your priorities, they’re different than Ravi’s or Jim’s or Suzanne’s or [Tamika’s 00:44:36], we can start then to customize our individual sales approaches. 

In a way, let’s hope this often gets thrown frameworks for understanding other people like Myers-Briggs Types and so on, and there is value to some of those things, but what I have found over and over again on teen dynamics or on sales relationships, it’s helpful to know that someone is an INTJ, but I actually think it ends up being more helpful to know that this client or this customer or this segment are a group of people who really value TLC. Once you know that, yes, they may actually have a variety of Myers-Briggs Types, but they know that this emotional experience is a priority for them, and it becomes something you can utilize to be more effective, and actually ultimately more successful.

Will Bachman: I think it’s helpful really at a strategy level of discussion, and I can imagine myself using your framework, even I can imagine us doing a session where, bring a top team together, introduce the framework, and have them ask people individually, “Okay, right now what are we good at and what are we trying to deliver? What are the top one or two of these seven experiences that we are trying to deliver today?” Have people do that individually and then once people have thought about it and filled it out, go around the room and see if there’s unanimity or people have different opinions about it, because if people … Like if some people think, “Oh, we’re awesome at being responsive, and that’s what our customers want.” And someone else says, “We’re really trying to deliver a Wow factor, and that’s the most important thing.” You want to get alignment around the team, even about what you’re trying to optimize.

Ravi Rao: Well, that’s the facilitation approach you use there, getting different people to state what they say and figure out where the alignment is. I think that helps the organization to just delve its skills around alignment and getting people on to the same page when they’re off and then scattered in different direction. In fact, I think that kind of technique often uncovers inherent, not bias, that’s too negative of a word, but inherently what individual people value. Well, of course we should be a responsible organization. And [inaudible 00:46:55] well, why? People will say, “Well, because I believe in being responsible.” And to that, then get into what is the distinction between what the individual people in the leadership room want, this is what we think the customers want. 

Ultimately, then, the hard part is we have said a few times that there’s a huge difference between saying, “Okay, well, we should get better at that,” because if you say, “We should get better at that,” you’re going to say that to everything, and it becomes less helpful to move up by five percentage points or a couple of degrees on all seven, because then you’re still … let’s say you were sort of borderline mediocre on all seven, and you launch an initiative to improve customer experience, and you come up with 28 pilot projects and you move all of them just a little bit, you’re actually not going to get any better in terms of market share or in the promoter scores or any of the key factors. 

What it ends up taking to fix really, really broken areas, to pick two or three that you can say, “We’re going to everything I can to become distinctive at it.” And then there will be arguments in the leadership room. Well, are we sure we want to be distinctive as that? Then that is the right argument to have, that’s the right discussion to have, to figure out what are the two things to become distinctive. And use your facilitation … or you could flip it to say, “Look, we’re in the car rental industry, what is … or we’re in the hotel industry or the aviation industry or the insurance industry or retail fashion, whatever it is, or metals and mining or whatever we are in, and then asking the question, “What would it take to be a destined class, business journals and Wall Street Journal writing articles about us, and pick one of these seven, what would it take to get to that level where when people just mention this kind of experience, regardless of industry, they would point to our company and say, well, look at those guys? They do that.” 

That kind of aspiration level to say, “How do we become distinctive enough that other people would want to know how we did it?” That becomes the real focal point. And it’s a strategy, right? There might be risk associated with it. There might be downside associated with making that big of an investment. The business teaches us over and over again that the successful companies figure out where to make their big bets successfully by being analytical, by being very deliberate about saying, “That’s what we’re going to be distinctive at.” And business shows us that sort of being mediocre on everything is not a path to long-term success.

Will Bachman: So, Ravi, that’s a great framework. It’s right in your book, Emotional Business. Where can people find this framework. Do you have it posted online somewhere where people can download it?

Ravi Rao: You know, I have not posted it yet, but I will do so in the near future. I’ll definitely post it to LinkedIn, so if someone listening isn’t connected with me on LinkedIn, they can find me that way. I will be putting up a couple framework … Well, you actually helped me realize the importance of having some of these frameworks available, and so I’ll be putting them up online on my own website in the near future, once that’s launched. 

I will say that anything that we talked about here is in the book, Emotional Business. When it peaked back in 2012, when it was first released, on number nine on Amazon listing business, it’s still in the top 2,000 business books, so a lot of people get it simply because I said a lot of words here, but they like to see them written down and in paragraph form and detail, and there’s 25 pages about this particular framework in the book, so if you want to get into it with examples from healthcare and insurance and a bunch of other industries, they’re all in the book.

Will Bachman: Ravi, I think it’s fair to say that if listeners want to use this framework, they are welcome to. It would be nice, if you do, to put source on there, Ravi Rao, Emotional Business.

Ravi Rao: Thank you for that, that helps me again. I would appreciate it, but ultimately I wrote the framework so it would have impact for people, so if people find this helpful, then that’s gratification for me.

Will Bachman: Awesome, and going along with the idea of gratitude, I’m sure Ravi would appreciate it if you do end up using his framework, I bet Ravi would love to hear from you about how it worked in your project and how useful was it. How can people contact you, Ravi? What is the best way for people to find you online?

Ravi Rao: The best ways that I have found out, with out increasingly modern communication project, I love hearing from people on LinkedIn and I loved hearing from people on Twitter. On Twitter, I’m Emobizguy, E-M-O-B-I-Z-G-U-Y. So if I’m there, I’m often providing a framework or an update or a quote on there that people have found to be useful as well. So either LinkedIn or Twitter for right now, and yeah, we’ll go from there. 

Will Bachman: Ravi, thank you so much. I’ve loved this discussion. Look forward to having you back on the show soon, and really appreciated having you on the show today.

Ravi Rao: Thank you so much, Will. As I said earlier, the goal is about the emotional experience. People will forget what you say, people will forget what you do, people never forget how you make them feel.

Will Bachman: And Ravi, you make me feel awesome.

Ravi Rao: Likewise.

Will Bachman: All right. Thanks a lot.

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