Evolving Experiences© Why Hospitality should be at the Center of your Business Strategy

July 2022 A FOCUS ON HUMAN EXPERIENCE PG. 6

CREATING A WINNING CULTURE PG. 17

Why Hospitality should be at the Center of your Business Strategy

CONTENTS 04

Experiences are driven by emotional connections.

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A Focus on Human Experience

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The Experience Economy

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What Consumers and Customers Really Want?

CREATING A WINNING CULTURE

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The Emotional Experience of Ownership

PG. 17

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About the Authors

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Experiences are driven by emotional connections.

We know how it feels when you book that dream vacation. From the time you start planning the travel particulars via phone or chat through the exciting few days before departure, to the journey itself. When you first glimpse the resort, enjoy a fantastic welcome, and soak in the ambiance, food, beverage, and amenities, you start to “feel” your vacation take shape.

How things make us feel is the most powerful reason of why we return, if we advocate, or not, what we tell our friends, and the likelihood of us being repeat customers at that resort or similar.

This is no different to the Away from Home markets of work, education, healthcare, senior living, or leisure.

And that’s why a hospitality focus needs to be at the very center of your overall business strategy.

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Wait, I hear. But we’re in the computer chip business, or banking, or technology, what does hospitality have to do with us?

The answer is everything! How you treat your employees, your customers has everything to do with it, as does how you treat your prospective employees and vendors, everyone that your business touches.

Often the word hospitality is used as a stand in for experience—which truly is everything that touches your guests.

It not only includes what most think of as “customer service” but also safety, quality, ease of use, and inclusivity– powerful differentiators in every marketplace.

How often have you heard the horror stories of prospective employees getting brushed off, ignored, rejected without reason, processes and procedures totally lacking any empathy whatsoever. If this is your business, what impact is this having on your business? How many potential advocates (recruits or not) are you turning into potential detractors? How are you thinking about the bigger picture whether you need them, like them, rate them, or not?

Why should the resort experience be reserved to the hotel industry?

Why can’t the same sense of place, experience be the same (or very similar) when arriving at the office, the first day at university, arriving at your retirement community, or in the instance of health and healthcare?

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How would this hospitality focus impact your business?

IMAGINE YOUR CONTACT CENTER OPERATIONS,

at the heart of your business, the first and often main point of contact with what you do, and with your customers. High stress, low pay, limited amenities, and benefits. For many, the investment in this group of employees is arguably far more important than the investment in the gleaming corporate headquarters. This investment must improve the employee experience on site while also creating a connected omni-channel experience.

IMAGINE YOUR ONBOARDING EXPERIENCE,

and if it instilled the same surprise and delight elements as when arriving at your resort. You receive a comprehensive pre-joining package, people know your name, welcome you, smiles, and invest time to be with you to understand you, for you to understand them, and how you can bring your best to your new employer and organization. This includes everything from having your tools ready on day one to receiving a welcoming tour of your new workspace.

TEMPTING YOUR EMPLOYEE’S RTO and the physical place, where they choose to be. An office alone is no longer sufficient but what is the experience offering that lures them to endure the dreaded commute and back into the office. Leveraging technology to listen to your workforce, connect with each other, and not only ensure digital equality but enable collaborative collisions like in the days of old. The best part of success here is that most organizations collect data from the team, but your ability to operationalize those insights will set you apart.

YOUR SONS AND DAUGHTERS FIRST DAY AT COLLEGE

away from home-beyond the Ivy League, parents make college decisions based on safety, comfort, and quality of food and experience. Building a sense of community on campus is a key attribute of the most successful universities. A hospitality driven strategy has the ability to drive value and better experiences that in turn will not only help the education experience but drive reputation and enrollments too.

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YOUR PARENTS OR GRANDPARENTS first day in their new community, possibly hundreds of miles away from home. How can organizations ensure that it feels like a resort experience? That not only they’re happy, comfortable, and well cared for but how, through technology for example can absent loved ones top up the meal plan, pay for additional classes and programming, buy them a special treat. This goes beyond care to enriching experiences that deliver on the promise that mom and dad are thriving in their new home.

In the world of work, with shrinking populations, real estate footprints, the term of the Espresso Office was born – half the size, twice the experience.

Why shouldn’t these real examples have the same level of focus and hospitality as the resort experience?

ANSWER: Historically organizations were judged by results only – how good were their widgets, graduation results and academic rankings, quality of health outcomes, financial performance, profit, and what for many in the past were viewed as soft services and amenities were secondary to the hard measurement of business results.

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The Experience Economy The Experience Economy is a term first used in a 1998 article by B. Joseph Pine II and James H. Gilmore and was about the sale of memorable experiences to customers describing the next economy following the agrarian, industrial, and most recent service economies.

This moves us directionally from commoditization to service to experience.

Pine and Gilmore argued that businesses must orchestrate memorable events for their customers, and that memory itself becomes the product: the “experience”. More advanced experience businesses can begin charging

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for the value of the “transformation” that an experience offers, for example, as education offerings might do if they were able to participate in the value that is created by the educated individual. This, they argue, is a natural progression in the value added by the business over and above its inputs.

Although the concept of the experience economy was initially focused in business, it has crossed into almost all areas of economic activity including tourism, architecture, nursing, urban planning, education, and business.

There are many examples of this transition from form and function to the outcome of experience, here’s just a few to consider: APPLE: transformed the technology and device industry and today are one

of the biggest and most powerful companies in the world. They understood that to have a device that just works wasn’t quite enough in the experience economy.

But to have a device that is simple to use, easy to set up, and even the ownership experience with the carefully designed packaging is part of the experience.

CHICK-FIL-A: Has created nearly cult status when it comes to the chicken sandwich. They have a culture of hospitality that is driven by their founder’s admiration for the Ritz Carlton brand. But their dedication to hospitality and consistency is only half the story. They have taken efficiency to the next level when it comes to their drive-through operations and speed of service. Their double drive through system, upstream ordering process, and food delivery conveyors move cars through in record time. They were even called into service during the pandemic to help move cars through Covid-19 vaccination sites in South Carolina.

AUTO INDUSTRY: in days of old car manufacturers talked about engine

size and speed, they then talked about distance and durability, today, the entire industry sells the experience and the car itself is somewhat secondary. There are many examples—BMW: The Ultimate Driving Experience, Mercedes Benz: The Best or Nothing, Subaru: Think. Feel. Drive.

AIRLINE SECTOR: a similar evolution through safety, speed, then comfort

but today these things are a given, and their point of differentiation is around the passenger experience and no longer just in flight. Airlines have invested heavily in the entire experience from booking through pre-flight, arrival, the airport lounge experience to arrival and everywhere in-between, no matter your class of travel.

FINANCIAL SERVICES: You only have to look at the myriad of banking

options today to realize that this industry has transformed at different paces. The focus on the digital experience has been a major factor for many reducing the reliance upon bricks and mortar branches, and in some cases, such as Capital One, they have adopted the Espresso example of half the size and twice the experience.

You also look at the premium some are placing on the hospitality experience.

USAA continues to top the list of customer-centric organizations with their focus on member experience.

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Many organizations believe at their core they deliver technology, services, things, and that the hospitality experience is secondary to the technical or operations focus.

The point is that they are intrinsically entwined.

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87% 89%

Of senior business leaders see CX as their top growth engine - North Highland

Of companies with significantly above average customer service perform financially better than their competitors (4%-8% better) - HubSpot

49%

Of consumers have left a brand in the past year due to poor customer experience - CallMiner

86%

Of consumers would leave a brand after as few as two poor experiences - Emplifi

61%

Of consumers will pay at least 5% more if they know they’ll get a good customer experience - Emplifi

$402 BILLION Is left on the table by companies that fail to provide simple experiences to their customers - Siegel+Gale

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It’s obvious from these statistics that the experience business is serious stuff, and not only that but the power it has to positively impact almost every aspect of your business from the top line, growth, and the bottom line.

But its not just a question of monitoring and tracking complaints, it’s about the process of building and garnering advocacy, supporters, ambassadors of your brand and business.

1 in 26 CUSTOMERS COMPLAIN THE REST SAY NOTHING

Remember, there’s a silent majority out there, shift your focus to not only minimizing the number of complaints but turning them into positive and visible advocates.

There are many aspects to designing the right hospitality style experience as every business is different, unique in some ways, but the formula is straightforward. Just like Einstein embraced the physics of motion, now’s the time to embrace the currency of experience, employees, customers, and guests, and to elevate your growth and performance and be the organization that magnetizes. Remember:

2 EQ × GROWTH = (EX) + (CX)

and that EXPERIENCE MATTERS. EQUATION LEDGER CX = Customer Experience EX = Employee Experience EQ = Emotional Quotient (Intelligence)

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It’s one thing recognizing how a hospitality experience approach can transform your business performance, but what is it that your consumers really want?

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WHAT CONSUMERS AND CUSTOMERS REALLY WANT? There’s an old saying, there’s nothing funnier than folk, or in other words that we’re all unique, we all seek something slightly different, unique, seen through a different pair of eyes – our diversity of thinking is what makes the world go round and we can celebrate this as we think about what our consumers and customers really want. This is at the core of inclusivity–the ability to create welcoming experiences where customers can see themselves in your business.

This is the same reason why realtors stage homes they want to move quickly, and for top dollar – nothing sells like a sense of belonging.

TRUST

Foundational: safety, reliability, consistency, trust

INCLUSIVITY SIMPLICITY

a smile, a feeling of belonging and being valued and heard

ease of use, easy to engage, buy and consume

to what extent can they

their experience, PERSONALIZATION customize make it their own

VALUE

the sense that the experience and quality is equal or greater than the cost, not just once, but consistently

OWNERSHIP

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a sense of commitment and loyalty to your brand

In 1908, Henry Ford made the first Model–T one engine, one color, one specification by 1927 he’d sold 15 million–the most sold car in history before the Volkswagen Beetle took that claim in automotive fame in 1972.

Today, the Mini has over 1 million different configurations to choose from. This level of customization would be probably never imagined one hundred years ago. Today’s Mini owner has their own personal instance, their highly customized version, an expression of themselves, and probably the highest sense of ownership, value, and pride amongst vehicle owners today.

This extreme level of personalization isn’t always possible in every business, but what it does do is demonstrate how important it is to the consumer today. Consumers want to feel connected, part of something bigger, be able to express their uniqueness, and have that sense of pride and ownership on a whole different level than the Model-Ts of the past.

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Today, it’s about the total emotional experience of ownership.

Customization and Personalization two words that are actually not interchangeable.

Yes, they do overlap but there is a distinct difference between the two.

A little like Henry Ford there were many retailers who spotted the opportunity to create suits for the masses and not just the wealthy.

Customization is the ability for the consumer to adapt the product or service more specifically to their own needs or use case, whereas Personalization is about tailoring the experience just for them.

The example of the Mini is customization however the sheer number of configurations turns it into personalization.

Nike created the opportunity for their loyal fans and consumers to personalize their shoes with customization, but also personalization with the ability to include your own initials on the shoes.

There are several parallels. In London, Savile Row was the place to buy your tailor-made, made-to-measure suit, perfectly created to fit you, and you alone, with every detail perfected just for you.

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With 3-D printers no longer preserved as a concept of Minecraft, the opportunities for customizations and personalization are almost limitless–print your own food, your furniture, print your next house!

So, what are the things to look out for in thinking about creating a hospitality culture in your business?

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WHAT IS YOUR EXPERIENCE TODAY? Get feedback from all your stakeholders. Of course, your customer, your employees, but also your shareholders, your leadership, future and former clients and employees. Listen to feedback both solicited and otherwise. Check out your online reputation on LinkedIn, Great Places to Work, Glassdoor. What are consumers saying about you on Yelp! and other social media platform?

HOW DOES THIS COMPARE? Often, taking a look in the mirror is one of the hardest things to do. The cold hard truths of reality are sometimes painful and difficult to digest, but in order to build a plan for effective change this step is essential. Gather the insights, the data, compare with your competitors, but also with the vision of who and what you aspire to be as an organization.

WHAT’S YOUR CURRENT EXPERIENCE MAP? No matter your business, understanding your current customer journey is imperative from the moment of engagement with your organization all the way through to delivering your products and services, retention, loyalty, and even when you lose a customer. How does your current customer journey make them feel? What are the lasting memories, and are they good memories or bad?

JOURNEY & EMPATHY MAPPING What is your customer trying to accomplish and how do they get there? Every business has and needs process. Every business needs to focus on experience.

Once you understand your current Experience Map, plot it as chart or a flow diagram and analyze each and every step through the following lens: Does it represent the least route of resistance? Is it as simple as it can be? Is it rewarding, satisfying, and how does it make the consumer/customer feel?

Are there opportunities to smooth out the friction points and answer their questions along the way. The goal with any good journey map is to fix problems before they drive customers away.

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DESIGN & EXECUTE Like any process, product, or service, your Experience Strategy needs to be very carefully designed, laid out, planned, and executed. It also requires the buy-in from the very top of the organization to ensure that there is not only Executive Commitment but supported by the right level of long-term investment and patience to see it through and reap the long-term strategic benefits of your plan. Sustaining an experience strategy is about daily commitment from all levels of the organization, and that the messaging is consistent to the team member at the point of service delivery.

MEASURE SUCCESS Measurement is critical in any initiative but make sure that you’re measuring the right things. First of all, define what success looks like and that will guide you to the measurements you apply such as: Customer and employee acquisition and retention rates, satisfaction ratings and feedback, repeat customers and loyalty, and if you get your experience proposition right, then growth as your reputation permeates, top-line growth, and bottom-line profits will increase too.

WHAT PROBLEM ARE YOU SOLVING It is easy to become enamored with your product or service as you build your organization – and that pride is important as you create a brand around your value proposition. But the only thing that truly matters is that you have an identified need from the market, and you have the solution to solve it. The reason this is so important is that it keeps you connected to the end customer – and customer is a blanket word here. This could be your guests, patients, students, consumers, residents, or members. But at the end of the chain is someone who is counting on you to solve their problems and that is a powerful motivational tool for your organization, particularly as you grow. This peoplefirst approach to service delivery reminds everyone that the product or service will eventually end up helping a human being and that inspires a sense of purpose.

No matter what industry, no matter your products or services, a hospitality focus needs to be at the center of every businesses strategy in order to not only survive but to thrive and deliver the best possible experience to all.

Be the best you possibly can be. Experience MATTERS!

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About the Authors: Tony Johnson

Leadership Advisory Council Chief Experience Officer (CXO) Tony Johnson is 4xi’s Chief Experience Officer and leads the Evolving Experiences© practice. He is a globally recognized thought leader, keynote speaker, author, and strategist when it comes to Employee (EX) and Customer Experience (CX).

Tony lives in Orlando, where he hosts his award-winning podcast, and prior to 4xi, he was Customer Experience Officer at global food and facilities giant Aramark.

Simon Elliot

Managing Partner & Co-Founder Simon Elliot is Managing Partner and co-founder of boutique consulting and advisory firm, 4xi Global Consulting. He is the Chair of WORKTECH Academy for North America, a Fellow of the Institute of Directors (London) and considered a global thought leader in the future of work and how we’ll work tomorrow.

Now based in the San Francisco Bay Area, Simon has lived, worked, and traveled globally having visited 6 or the 7 continents and led business and projects in the UK, Northern Europe, Australasia, Asia, South, and North America.

Barbara Boden

Managing Partner & Co-Founder

Barbara Boden is Managing Partner and co-founder of 4xi.

Formerly global head of amenities at JPMorgan Chase & Co, Barbara is considered an international thought leader and expert in the creation of best-in-class experiences in the world of work.

Based in New York, she has run operations globally from the Americas to the UK and Ireland, Europe, and India, the Philippians, and across Asia and Australia.

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Inspiring

a brighter future,

Together.

4xi Global Consulting & Solutions is a boutique advisory firm focused on a people-first approach to changing experiences for GOOD. Whether for people at work, in education, at rest, or at leisure, 4xi leverages the tenets of a hospitality focus to drive impact, facilitate change, and make a real difference.

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