European History : Moments of Truth
First, Break All the Rules: What the World's Greatest Managers Do Differently | 
 | 80% Recommended by our customers.
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Manufacturer: Harper Paperbacks
Release Date: 1989-02-15
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- ISBN13: 9780060915803
- Condition: New
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 Moments of Truth - A must read
I am a Banker by profession. I got the opportunity of reading the book, Moments of Truth by Jan Carlzon, only 23 years after its publication in 1987. I have known the phrase "Moments of Truth" for quite sometime but I never dared to find more about it.
What a fascinating story!. Book is all about customer service, targeting customers, finding customer needs and how to obtain the support of all employees to turnaround businesses.
Book starts with a story how a Ticket Agent helped a client (who forgot to bring the ticket to board a Scandinavian Airlines flight)to get down the ticket from the hotel he left. Good lesson for young Bankers. If a customer comes to the Bank leaving a vital document, will the Bank Teller decide to send a vehicle to the client's residence to bring the document, whilst the customer is seated in the Bank?
A must read for young bankers.
Gamini Hanwella
Commercial Bank of Ceylon
Sri Lanka
Timely Insight on Brand Strategy and Customer Service
This book uses personal examples from the 80's and 90's to illustrate the author's philosophical business approach. Rather than seeming `dated' the reader marvels at how relevant these lessons are for today. As CEO of SAS, Carlzon turned the beleaguered airline around in 24 historic months. He did this very simply by having a single-minded, service-driven brand strategy. What was unique, both then and now, was his commitment to the implementation of this strategy. EVERY single person in the organization, from the CEO to the mechanic screwing on lug nuts, was thoroughly briefed on the brand strategy and then trained on how to bring the service-driven concept to life. Carlzon transformed the organization from the inside out and reaped the rewards in the marketplace. An easy, worthwhile read.
Moments of Truth
This book is an excellent read - quick, succint and to the point. Content is still relevant in today's marketplace.
 You can read it in an hour
This short book is an examination of three companies that Jan Carlzon worked for and how he turned them around. The first is unremarkable and is not relevant to his later insights. He was responsible for a company which was a subsidiary of a airline which sold holidays. He reduced costs to get it through an economic downturn.
The next job he had was working for a Swedish domestic airline. The airline was losing money but the ability to cut costs was limited. The reason for this was that the airline schedules and routes had been determined politically. There was limited ability to cut costs. The strategy he used to overcome the problem was to try to increase revenue by fare discounting. The problem was that previous fair discounting attempts had not been that effective. He developed a advertising strategy which aimed at expressing the cost by referring it to notes of currency. This was successful and traffic increased not by an anticipated 20,000 but by 120,000.
Following that he was put in charge of SAS an international airline company that was owned by Norway Sweden and Denmark. His strategy to make the airline profitable was to sell full fare seats. Up to this time Carlzon had made a habit of firing internal marketing units in his airlines and depending on the knowledge of his staff at the front line. He was able to use this knowledge to make his airline attractive to business class passengers.
He removed first class and created a business class.(In his view the only people who used first class with any regularity were airline executives) The business class had a distinct section of the plane which was curtained off. They got on the plane last and left first. They had a distinct waiting area. He worked out that the most significant thing of importance to business class travellers was prompt departure. He asked one of his employees to come up with a strategy of moving to 100% success of leaving at the right time. They came up with a strategy which identified the reasons for airplanes leaving late. They were:
* Waiting for passengers on connecting flights
* Waiting as a result of meals not turning up for the passengers
* Waiting for late staff
* Compressing flights
A strategy was worked out that would cost an estimated $1.8 million dollars to make flights go on time. From now on no one would wait for connecting flights. Passengers would be put on other carriers. If meals did no turn up it was thought that in most cases there would be a surplus and if there was not customers could be given vouchers for restaurant meals at the next embarkation point. If cabin (as opposed to flight) staff did not turn up the aircraft would take off. The compression of flights means that if a plane was half full it would be cancelled with the aim of trying to fill up the next plane to a full load. Flights simply were to be flown regardless of whether the flight was full. This in fact was going to be the major part of the $1.8 million cost.
What happened was that the strategy of flying on time was so successful flight compression was not a problem. All flights were now full and the strategy only cost $200,000 with the pay off the increased revenue from the full flights.
Another strategy was Carlzon's moth balling of newly purchased airbuses. One of the things which characterizes the airline industry is the use of new technology. To this extent the industry is production driven. The advantage of the new airbuses was that they had a lower cost per-passenger mile. The problem with them was that they were a bigger aircraft and for them to run cost effectively the airline would have to have less scheduled flights and have more people flying on each scheduled flight. This however had the potential downside that the airline would lose attraction to the customer as there was less flexibility in the schedule. For that reason Carlzon kept his older DC 9 aircraft in service as he was customer focused.
The conclusions that Carlzon draws about how to run a company is that marketing and sales are the key. The reality of a company and how it is seen is based on the individual moments of contact that a customer has with the representatives of the company. As these contacts are so important it is his view that the representatives of the company at the client interface be highly motivated and skilled. Further that they have the ability to make decisions about what they do. Lastly that they be in a position to feedback to the management what the realities are. In his view a flatter empowered structure is the key to the success of the modern corporation.
The sorts of things that he did were counter intuitive. It would be thought that aircraft which flew cheaper would be good for the bottom line. It makes good sense to compress flights so that aircraft fly full. Yet it was these things which potentially had the cost of reducing market share. Managers who were isolated from the customers might think it was attractive to cut costs in this way but front line staff are better able to sense the market dynamics of the industry.
Moments of Truth by Jan Carlzon
Book Reading Style
This book is an easy read.
Opinion about Content
I believe it is informative and has great value to pass on. Recommend read.
Information is dated. Born out of the `Total Quality Management' concept of the sixties. Methodology concepts are based on authors personal business approach presented in a self-help format based on how he ran three businesses. The author talks about some of the shortcomings of this business strategy and hints that it does not meet a business plan on all levels. It seems to be a short-term fix and once achieved needs to be revisited, redefined, redirected, and reinitiated. It is one mans approach to running a business that worked. It could have worked because he is right on, or he applied a new approach at the right time, or his personal enthusiasm, or his dedication. It is one part of an overall business strategy and if implemented needs to be understood and not half employed.
Key Concept
Business strategy orientated around customer service accomplished by delegating responsibility and empowering employees.
How Achieved
The authors premises are define your customer, identify the customer needs, focus your business to meet those needs, and implement the services to meet those needs. In a service oriented business plan the author stresses decentralizing the company structure, delegating responsibilities to the frontline employee, trusting and empowering the frontline employees to handle those responsibilities. He believes this approach better meets the customer needs vs. the more bureaucratic process of company policies, procedures, forms, and chain of command.
How to Apply
Delegate responsibility, this is a concept we hear repeatedly. To delegate responsibility we have to empower the employee to perform the task and resolve issues. Empowering the employee is key; it is a principle that allows the employee to handle the delegated responsibility.
Two main ingredients to making this work; one providing the employee with the proper tools and; two having confident in the employee's ability to handle the responsibility independently. This second point is an unspoken truth that can be scary because it releases control.
The author talks about how empowering the employee flattens the hierarchical pyramid and changes the role of middle mangers from managing procedures to leaders.
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