Customer Service Conundrums 2

Ok, so I am back again with more thoughts on customer service and the desperate need for improved training here in China. And, for this entry, I want to keep things simple, to focus on the basics.

As I write this blog, I am watching an LCD screen on subway line 10 in Beijing. The video that is playing is of an Olympic volunteer helping a disabled spectator to visit the Bird's Nest stadium. The sentiment in the video is wonderful. The volunteer helps the man into a specially modified vehicle using a state of the art chair-lift. She then helps him out of the vehicle again at the stadium and directs him to a wheelchair accessible entrance. The video then closes with the disabled man sat waving a mini Chinese flag. It all sounds lovely doesn't it? However, I have to doubt its realism.

Let me recount my own Olympic customer service experience. And, then let's contrast the two. During the recent National Day holiday, my girlfriend and I took a short trip to Beijing. One of our aims was to visit the Bird's Nest and Water Cube. The plan was simple. We wanted to arrive late in the afternoon so that we could see the stadia both in daylight and then illuminated at night. To me, this did not seem like an outrageous expectation. Unfortunately, I could not have been more wrong.

Our problems started when we tried to transfer from line 10 to line 8, which would supposedly take us straight to the Olympic arena. However, security in the station would not let us change trains without tickets for the center. As we did not have tickets, we asked where we could obtain them The guard said that he did not know, but that we could not transfer lines.

Unable to find any help, we moved outside in an effort to locate some tickets. We found several Olympic volunteers bedecked in their now famous blue shirts, but still no solution. Enquiring in both Chinese and English, we were not told where we could find the tickets, only that they did not have any. It took trips to three booths and conversations with nine separate volunteers to finally discover that tickets were limited and there were none remaining. In the end, the closest we got to the stadia was snapping pictures from across the fence.

Our experience was frustrating. Primarily, this was because we could not see the the two arenas. However, I must admit that I was also irked by the fact even though there was a large display of customer service, lots of smiles and plenty of enthusiasm, there was not actually that much help.

Personally, I believe this to be a major trend in customer service here in China. Many organisations seem to be keen to invest in customer service, but on a slightly more superficial rather than practical level. They want to show they care, they want to show they have the staff to help, but they do not provide the practical training to make their staff effective. Let me give you two examples I have encountered in Tianjin in which an organisation made an effort, but where their training - or lack of - had rendered this useless.

The first is my local Wal-Mart, a place that continuously seems to push customer service boundaries .... in a bad way! Let me paint you a typical scenario. After filling my trolley with shopping, I move to the cashier. Unfortunately, there is a huge line of people and only a few open checkouts. However, standing around holding walkie-talkies and taking inventory are scores of other employees. When I ask what they are doing or if they could open some more checkouts, they stare at me and tell me that is not their job or they are not trained to do that. This situation always leaves me perplexed and incredibly frustrated. Wal-Mart is clearly making an investment in customer service, but not at the most basic, most critical level. There are posters around the store advertising various services, there are staff waiting at the entrance to welcome shoppers and there are staff giving away free samples. All of this is nice, but none of it is necessary. Yet, having enough people at the checkout is vital, but ignored.

The second example is the Tianjin BMT (Binhai Mass Transit) - a light rail system that operates between Tianjin and TEDA. Last week, I was on my way back downtown after training in TEDA, and, I was in a hurry. I rushed into the station, bought my ticket and headed to the entrance. The next train was about to leave. I pushed my ticket into the slot. However, instead of the small gates opening, it spat my ticket back out, remaining firmly closed. I tried again, but got the same result. So, I moved to the next entrance, still no luck. All the while I was doing this, an attendant looked on passively. After my third failure, I turned to her for help. She stood, stared and shrugged. As I glared at her and began to shout, she eventually sprang into life, taking my ticket and exchanging it for one that worked. Much to my dismay, this took some time and, before I had a new working ticket my train left. I was fuming.

This was poor service, which, on its one, was not unusual. It was the events that followed which grabbed my attention. The next train left 15 minutes later. When it did, one of the attendants - in full dress uniform - saluted as though it were a visiting foreign dignitary. This then happened at every station along the route back to Tianjin. I began to wonder, if Binhai Mass Transit was prepared to go to such lengths to create a good impression, surely they could have spent a few moments training their staff how to operate an essential piece of machinery.

The BMT's slogan is "Speed Brings Efficiency". As I read it, I wanted to find a staff member and yell at them, "No! Training your staff in the basic skills of their job brings efficiency." It does not matter how fast the train is, if the staff cannot help the passengers.

Mr Turnover

As I am not a HR manager, I do not encounter the rampant turnover that characterises China's 'war for talent'. So, how do I know it exists, how do I know the war is raging. Well, first, by talking to HR managers across northern China and asking about their challenges. Second, by following the media and by reading surveys from major organisations like Hudson and McKinsey to understand major employment trends. Just recently though, I encountered a third way - I met Mr Turnover.

Obviously, Mr Turnover was not actually his name. He was actually called Mr Zhang. I met him at an event in Tianjin. It was just that he epitomised everything about the 'war for talent'. He graduated in 2003 and in the time since, he had got through six different roles. That's it count them, six! When he told me, I was dumbfounded. 2003 was one year after I graduated. In the same period, I have had three major roles, which I would actually consider a little excessive.

I must admit, I had read countless surveys and spoken hundreds of HR managers, all of which told me turnover in China is rampant. Yet, I had never seen a living breathing example quite like Mr Zhang. Because of this, I was keen to pick his brains.

My first question was a simple one, "Why?". Was there some fundamental underlying reason that he moved between roles? Was he so greedy that he whenever he caught a sniff of more money he could not jump ship fast enough? Did he have one particular skill that no-one else in China possesses that makes him a unbelievably hot commodity? Were the organisations he worked previously so bad at engaging their employees that he felt compelled to leave?

As always, the situation was not as simple as any one basic reason. It was as though Mr Zhang was a microcosm for China as a whole. His reasons for moving were a mixture of push and pull factors. He was well-qualified in a highly sought after field, which meant that organisations were keen to tempt him away. "Headhunters are always on the phone offering more money", he pointed out. He was, though, quick to add, "It's not just about the money. At two of the companies I only lasted around three months. This was not financial, I just did not like the atmosphere or environment."

And, what of his current job? Was he ready to make it number 7? "No, not at all. The salary is good, I feel very comfortable with my colleagues and they offer great training."

My conversation with Mr Turnover was fascinating. It certainly confirmed that China's 'war for talent' is a complex issue for which there is no quick fix.

Higher Education Inflation

For this blog entry, I would like to tell you about the start of my career. Specifically, I would like to tell you the story of my first full-time role after graduating from university.

It was 2002 and I had just graduated from the University of Hull. After spending four years in academia, I was keen to cut my teeth in the real world. Having finished with a good degree I was expecting to find a well-paid challenging job within a prestigious organisation. I figured this would be no problem. Unfortunately, I was wrong. You see in the late 1990s and early 2000s university enrolment in the UK increased dramatically, just as it has in China in the past 5 years. This meant the UK began to experience something we could term 'higher education inflation'. Suddenly, a degree was no longer worth quite as much as before and, crucially, it no longer guaranteed a great job and a higher starting salary.

This was the situation that confronted me and many of my classmates. We were all expecting to find great jobs, but alas, there were just not enough of these for everyone. The situation was so bad that many of my friends were forced to take low-paying temporary jobs whilst they searched for the perfect role. Eventually, I was lucky enough to find something. However, it was far from being my dream job. It was a role in the sales and marketing division of a major British newspaper company. The position was not quite as senior as I was hoping and the pay was good, but not great. Therefore, I was unsure whether to take the position, but eventually, I was swayed by desire to finally end my job-search and also by the offer of a shiny company car.

The manager who hired me was named Mick Butcher. If I were to describe Mick, I would use the term 'old school'. He had been in the business for many years. Even though this meant that many of his methods were rooted in the 20th rather than the 21st century, he had quickly grasped the changes in the British job-market. He realised that for a job which previously demanded just A-Levels (qualifications taken in the UK prior to attending university), suddenly could require a degree. Mick took full advantage of this, using the shiny company cars to lure myself and two other graduates to his team.

In terms of pure recruitment, this was a master stroke. However, in the longer-term, the plan was found wanting. Fast-forward 18months and all of us had left. Why? The key reason behind this - and a fact that Mick failed to realise - was that with graduate qualifications come graduate expectations. My colleagues and I wanted training, we wanted development opportunities and we wanted the chance to earn more money. None of which we got.

So, how does my story apply to China? The clearest link is higher education inflation, which in China might better be termed better as "higher education hyper inflation". The number of graduates in China is mushrooming. This year, literally hundreds of thousands of graduates will leave university and face the prospect of not finding a job. Possibly the best example of this took place in Zhengzhou in late 2006 when a recruitment fare descended into chaos as hundreds of students stampeded in an effort to get a lead on the best roles on offer. In many respects, this situation is fantastic news. It means that (a) you will be able to fill more roles with highly-educated young people, and (b) you will have a far wider choice of candidate. However, this is only fantastic news if you manage the situation correctly. Getting your graduates aboard should be just be the beginning!

The danger for many organisations is that, because the graduate recruitment market is weighted so much in favour of employers, many companies grow complacent. After all, if there are so many graduates out there, they should be grateful for any opportunity they receive, right? Wrong! Once you have the best possible graduates on board, you need to keep them and, more importantly, you need to develop them. The crux of China's hyper inflation is that you must use it as a way of planning for the future. Currently, we have a situation where experienced talent is scarce, but determined and highly educated young potentials are plentiful. In China as a whole, this situation will not change quickly. However, for your organisation, you could speed things up.

I recently completed two different sets of training at multinationals in Tianjin, which had adopted fantastic approaches to their graduate recruitment. Both had decided to aim high, very high. They had hand-picked their graduates from some of China's top universities. As I began training these graduates, it did not take me long to realise that not only were they well-educated, but their communication skills and English levels were also fantastic. I must admit, I was surprised to meet such young employees with such ability, and I explained as much to the HR manager at one of the organisations. She replied:

"Oh yes, I know. We filtered out hundreds of candidates to find them."

"Oh, really? So you must have high hopes for them."

"Absolutely! We envisage them playing a major role in our organisation over the next ten years. I truly believe some of them will take senior management roles."

"10 years? Wow! That really is long term planning. But, with all the turnover in China right now, aren't you worried about losing them."

"Not really. We are giving them a fantastic opportunity. We plan to provide extensive training, to give the opportunity to work overseas and to enjoy very competitive financial rewards."

It was fantastic to see such a clear vision. The two organisations had certainly not fallen into the same trap as my first employer. They understood the opportunity presented to them and realised that by offering great development opportunities, they could nurture their new graduates to become future leaders. I did, though, have one final question for the HR manager:"Training, good salary and overseas travel - wont that be expensive.""Of course, but only in the short-term. To recruit senior managers is becoming outrageously expensive. In the long-run, if we can grow our own talent, this process will actually save us money!

The Pied Piper of Tianjin

It was early Saturday morning and the light was just beginning to permeate through my curtains. As it was the weekend, I was looking forward to rolling over and enjoying two or three more hours of blissful slumber. Unfortunately, my plans were wrecked by a rasping voice piercing the silence from outside. In a vain effort to escape the awful din, I pulled my pillow up over my head to block out the noise. Alas, it was to no avail. So, crotchety and bleary eyed I shuffled across my bedroom floor to my window. I pulled the curtains back to see what was going on.

Beneath my apartment block is a large hair salon.Considering I lost my hair at 20, this place normally has no impact on my life whatsoever. However, on this particular Saturday, things were different. The manager was standing in the doorway of the salon holding a megaphone, screaming at his employees. The situation made me chuckle. The manager was clearly irked about something, and was making his feelings known. Unfortunately for him, his employees seemed oblivious. I could tell by their blank stares and vacant expressions that absolutely nothing was sinking in.

This leadership style is one that I have seen countless times in northern China. It is one in which managers and supervisors do not look to stimulate or motivate their teams to help generate new ideas and better performance. Instead they just expect them to blindly follow instructions. This reminded me of the old children's tale the Pied Piper of Hamlin. In this story a town in Germany is infested with rats and is desperate to remove them. So, the mayor hires a piper to play beautiful music to make the rats follow him. The piper does this and leads the rats to the river where they are all drowned. Everyone in the town was delighted. However, when the mayor refused to pay the piper, he used his music to lead all the children in the town away, just as he did with the rats.

The manager of the salon was trying to emulate the piper. Unfortunately for him, he did not have a magic flute and his staff were certainly not following him.
This is an all too common scenario in China. Too many managers believe leadership is simply about making others follow their lead. Sadly, because of this, their employees grow increasingly de-motivated. Here are a couple of examples that I have encountered:

1. My first example came when I was training staff at a major multinational in Tianjin about meeting skills. I asked how useful - on a scale of 1 to 10 - they thought their meetings were. To my surprise, I heard lots of 2s and 3s. "Why, so low?" I asked. "Our managers" they replied. "They talk, we listen. And, then, they make the decision .... We do not even need to be there."
2. The second example was a little different because the manager in question actually realised there was a problem. She was the sales manager for the DongBei office of a major multinational and was frustrated because her staff were reluctant to offer ideas and simply wanted to follow her lead - whether she was heading in the right direction or not. There were two reasons behind this (i) her predecessors followed the pied piper school of leadership and expected obedience rather than ideas from the staff, and (ii) the sales manager was imposing both in physique and personality and, as a consequence, scared her subordinates. The problem was that even though she recognised the problem, she did know how to solve it.

It took me a little time to grasp the relevance of the manager who woke me that Saturday morning - I was still pretty sleepy after all. As I am sure you will have read in my previous entries, top-quality talent is in desperately short supply here in China. The area where this shortage is most acute is in qualified managers. There is a McKinsey report that I have quoted several times in Network HR that illustrates this clearly. It found that by 2015, China would need 75,000 MBA qualified managers to ensure its continued growth. However, in 2005, it had less than 5,000. To make up this shortfall, most organisations still look away from mainland China for their managerial talent. By simply importing managerial talent, China is handicapping itself - it needs to develop homegrown talent to plug the leadership gap. China needs to put down the megaphone and major organisations need to invest in training to help develop leadership talent.

Customer Service Conundrums

So, it was Sunday and my girlfriend and I were out shopping on Binjiang Dao - Tianjin's major retail area. We were not looking for anything in particular, rather we were just browsing. As we ambled around the Nike store, I noticed a rather nice Olympic T-Shirt with 'Great Britain' written across the front. After my native country's surprisingly competent performance in Beijing, I thought the shirt may be a nice memento. And, better still, it was 33% off.

Up until this point, my story is relatively mundane, right? Certainly. However, the events that followed certainly were a break from the norm. One of the sales assistants and approached me. I was expecting her to follow the standard procedure of offering a "ni hau" before standing awkwardly next to me and thrusting products I did not want under my nose. Yet, to my complete surprise she did nothing of the sort. Instead, the remarkable following conversation ensued.

"Can I help you sir?"
"Oh, yes, I am looking at these 'Great Britain t-shirts. Do you have an XL?"
"Let me see ... I don't think so. Because they are on sale. We have 'USA' in XL, would that be ok?"
"Not really. I want the other one because I am British."
"Ha ha, ok I see. Let me see, we have XXL, but it is a Chinese size, so it might not be too big. Why don't you try it. The fitting rooms are over there."

The shirt fit and I purchased it. Even though it looked great on me, I left the store thinking more about the great service I received. The sad is that high-quality customer service employees are a rare bread in China, so much so that when you do encounter good service, it leaves you pleasantly surprised.

Now, let me contrast my experience at Nike with the travails I encountered at Starbucks a few minutes later. My girlfriend was in need of a Green Tea Frappuccino and quite fancied a latte. Both of these products require milk. Something you would expect a major coffee chain to have in abundance. However, apparently, this was not the case. I visited three different stores along Binjiang Dao, and in each, I was told, "No Milk - Only Soy". In the first two outlets, when I asked why, I was met with only an embarassed stare and a repetition of "No Milk".

It was only at the third store that I got any form of explanation.
"Because there are problems with milk in China at the moment, we are only using soy milk."
This was quite a rational explanation - certainly one I would have no qualms with after the recent scandals regarding milk in China. However, I was not satisfied. I had wasted my time trapsing around three different locations, and still I had no coffee. Why couldn't they have told me at the first store and saved my time and energy? Let me tell you why. Because customer service talent is so scarce here in China, many organisations are forced to settle for less. However, the key issue is a lack of training, particularly in communications.

The sales assistant at Nike was such a surprise because she was happy to talk to her customer. When she didn't have the size I wanted, she was able to offer me alternatives, one of which brought the sale. Starbucks, on the other hand failed to effectively communicate that they had no milk. They could easily have put a large poster in the window explaining the problem. Had they done so, my girlfriend and I may have chosen a different product. However, after visiting three stores without success, I was so frustrated we simply went elsewhere - presenting Starbucks with a loss of 60rmb!

Calling a Ceasefire

So, turnover in China is spiralling seemingly out of control. Why is this? Why has a full-scale talent war broken out? In previous blogs, I touched on two of the major reasons.

China's pool of talented, skilled and experienced employees is far too shallow. Since the days of Deng Xiaoping, China has been growing, and growing fast - in each of the past six years it has enjoyed double-digit growth. On face value, this is great news. China is developing faster than any other nation in history and, as a consequence, Chinese people are enjoying far greater economic freedom. However, dig a little deeper and things get a little more complicated. Much of this growth may have been built on Chinese manpower, but talent and expertise imported from elsewhere. Even now, two decades after China first began to seriously open to foreign investment, too many multinational organisations look away from the mainland for managers and highly-skilled staff.

So - even after the economic miracle we have seen in China - why is there still a dearth of Chinese talent? This brings us to the one of the major reasons behind the war for talent. Even with talent so scarce, organisations are not doing enough to develop their existing employees. To continue our military metaphor, many organisations are developing a 'siege mentality'. They are charging into the job market with all their guns blazing to fight it out over the scraps of talent that are available. Their weapons of choice - salary, benefits and promotion.

The problem with the tactics most organisations are employing is that, ultimately, they are self-defeating. Even if they bring victory in the short-term, they serve only to prolong the conflict. For example, if an organisation manages to lure in a skilled and experienced new hire with the promise of a lofty position and bump in salary, they satisfy their immediate needs, but sew the seeds for problems further down the line. Each salary increase they offer sets a precedent for both employers and employees. The employee sees that their talents are saleable assets, they can auction off to the highest bidder. The organisation learns that if it wants talented employees, it needs to open its wallets.

To use one final ‘talent war’ metaphor, organisations need an olive branch. They need to make peace. Rather than fighting it our for one or two talented individuals, they need to develop the talent within their own team.

Escalating Turnover

With the recent earthquake in Sichuan having such a massive impact on China, I am sure many of us failed to notice when a minor tornado ripped through the small town of Wuchuan in Guangdong province in early June injuring 16 people. That, I suppose, is unsurprising. There is, however, another tornado currently ravaging China. This one is the problem of spiralling employee turnover.

In my previous entry, I discussed the two very different pools of talent that organizations based here in China can drink from. The one containing talented, experienced and available employees is close to running. This means that organisations across the country are desperate to get their hands on the finite talent that is available to them, and they are prepared to do almost anything to do so.

The most common way of trying to entice talented employees is by offering them better positions and more money. A survey by Mercer in 2006 revealed that these two were the weapons of choice for the majority recruiters - 23% preferring more money and 19% opting for promotion. Clearly, throwing money and better positions at employees will work in the short term. However, this tactic creates something of a vicious circle. If an employee is attracted to an organization by money, it is also likely they may be attracted away from an organisation by money.

This is where we see turnover spiralling out of control. As soon as one organisation begins to offer more money, then others follow suit. This has lead to some worrying statistics. In many major cities, turnover has now topped the 10% mark and is in no danger of declining. Mercer also revealed that the average Chinese employee between the ages of 25 and 35 is now likely to stay with their organisation is now likely to stay in their current role for less than two years - a figure which has decreased dramatically in the past five years.

Drinking from China's Talent Pools

I first came to China in the autumn of 2005, just in time for the National Day celebrations. However, being new to the Middle Kingdom, I had no idea just what the Golden Weeks were like for travel. I had planned to leisurely travel around the country enjoying the fine weather and discovering a fascinating blend of culture. However, as I am sure you can imagine, I found traveling a particularly difficult prospect. The trains were packed to the rafters and air tickets were being hawked at premium prices. Therefore, I spent most of my time stranded in Beijing, before eventually snaring a bus ticket to Shanghai.

My brief stay just over three years ago may have been ultimately disappointing, but it whetted my appetite for China - I knew I would soon be back. And, so it was. Fast forward a few months and I landed in a cold foggy Beijing just in time for Spring Festival. This time though, everything was planned out like a well-oiled machine. My friend Ossie and I were to stay in Beijing for the fireworks and holiday fun, before spreading our wings and exploring the country on a wider scale. We tramped our way around several fantastic cities. However, one I remember with greatest clarity is Hangzhou. We stayed there for two misty, drizzly days admiring the West Lake and the ancient buildings that surround it.

I certainly have fond memories of Hanzghou because of the wonderful traveling memories it provided. However, having worked in the HR field here in China for the past two years, my memories of Hangzhou now also affect me in a different way. The job-market in China right now is a little like Hangzhou – imagine it as a city built around a lake. Actually, imagine it as a city built around two lakes. Or rather, a country built on two talent pools.

The first of these pools is full of fresh graduates in the first year or first few months in the job-market. This pool is deep and overflowing. To give you a practical example of this, statistics in Beijing released in 2007 estimated that over 200,000 would graduate that year. However, just 87,000 could expect to find jobs requiring university degrees. The other pool though, is almost dry. Employees with strong qualifications and – crucially – rich experience are thin on the ground (sorry for mixing my metaphors a little there). A McKinsey Global Institute survey in 2006 estimate that in the upcoming 10 years China will need 75,000 MBA qualified managers, of which – at the time – it possessed just 5,000.

These two frighteningly dissimilar pools are the reason why today organisations in China are fighting one of the fiercest talent wars the world has ever seen. Over my next few blog entries, I will focus on just this – war for talent.