Posts Tagged ‘Management’

Linda Livingstone: seeking innovation and leading through change

Posted: September 1, 2014 by jennroig in English, Interviews
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Linda Livingstone, current Chair at AACSB

Linda Livingstone, current Chair at AACSB

As new elected Chair at AACSB, Livingstone share her perspectives and ideas regarding current and future challenges faced by leaders -both corporate and academic- as well as the Business Schools’ role in improving the quality of education.

This is the original, unedited English version of the interview to Linda Livingstone published on AméricaEconomía on August 7, 2014. 

You are assuming as Chair of AACSB in a time when B-schools from all over the world are competing even more to attract the best candidates and faculty. But there’s also a need to foster collaboration in order to give students exposure to various cultural and business environments. How will the AACSB balance its relationships with individual schools, and its role in improving management standards in different regions of the world?

We see those two issues as really working together. As we work with individual schools to help them improve and get better and to advance what they are doing, it obviously has an impact on the quality of management education in whatever region of the world that they are part of. In addition to working with individual schools and with schools within a region of the world, we are also working hard to find better ways to connect schools across regions of the world. We see how a lot of that has already happened. The more we can do about that, the more we can learn from each other, because in different places of the world, people think differently, have different challenges and different opportunities.

So it is about working at those three levels, individual schools, schools within a region, and connecting schools across different regions.

There are a lot of new concepts and notions claiming what the best management standards or strategies are. Looking at the bottom line and seeking efficiency is neck to neck with the need to take risks fostering innovation and creativity. How are the AACSB standards assessing the new programs that schools create to tackle new needs and concepts?

The way standards are written in AACSB, they very much focus on schools’ missions, wanting to ensure that any new program, anything the school is doing, is driving that condition as an institution. That’s at the upper level.

We are really trying to apply those across all process at the school, whether it’s existing programs they had for many years or its new programs, to ensure that they are really seeking to provide high quality at any program they are providing.

And they have standards for the kind of faculty they have in the classroom and the kind of services of support they provide to students. The standards are really applicable to all programs.

It’s all about helping the school to think about its mission and how it’s playing out in the different programs.

In terms of keeping up with new developments, we have conferences and seminars we give around the world, where deans and faculty and staff of business schools come together and share with one another what they are doing, what’s working, what the challenges are. What we are really trying to do is creating learning communities of business schools professionals to share and learn from each other.

It’s about the standards but also about other things business schools are doing. As we all think differently, we spend a lot of time learning from each other. Learning best practices of others.

Other thing that has been discussed about it’s this issue of efficiency kind of versus fostering innovation and creativity, which is a great issue we are all dealing with. I do think that the need for efficiency and finding the most cost effective ways to do things in business, as opposed to creativity and innovation and making think differently on how we do things, I think often they can work together. They may seem to be mutually exclusive and working against one another but I think in reality in many cases is the need to be more envisioned as to think differently helps us to be more creative and to be more innovative as business schools.

There has been a polemic around MOOCs. Despite different visions, opinions and implementations carried out by different B-Schools, it seems that online courses are here to stay and will impact even more the management education worldwide. Where is AACSB standing in this regard? Is there any debate, or consideration towards creating standards, or offering accreditation to some MOOCs?

The way accreditation works with AACSB is that we accredit institutions or business school units. We don’t accredit individual programs. When the business school unit is accredited, all of the programs within that institution are looked at. If the institution is accredited, then all programs are accredited.

When we revised the standards in 2013, we had a pretty significant discussion whether we should have a separate set of standards for online courses or online programs, meant for more traditional online programs, and we made a decision that we would not do that. We would have a set of standards that would apply regardless of the delivery mode, the location of the program.

We try to determine always if schools are delivering programs in a high quality way, regardless of the delivery mode.

The standards look across all kinds of delivery systems in a school.

What happens when a school creates an alliance with another school, which maybe not be accredited? Would that affect the initial accreditation received?

A school is reviewed every five years, taking the standards into account for that revision. As such, the school would maintain accreditation through that whole period. If it adds new programs during that five years period, then it would fall under the review of the next revision on schedule. Unless something very unusual happens, we would not go back to review a school that had received accreditation after one or two years.

If the school is partnering with another school that is not accredited, the program in which they are partnering has to meet the accreditation standards, even if the other school is not.

Today female leaders are under the spotlight -both in the public and private sectors. As female leader, what do you think will be the most important challenges that a woman in a leading position faces now and will be facing in the near future?

I don’t really think that the challenges women leaders are going to be facing in the future are going to be much different from the challenges male leaders will be facing. I do think sometimes society is expecting women to respond differently to those, which may or may not be the case. But I think in general, whether it’s in higher education or other areas, being able to drive innovation and change, and help lead an organization through change, it’s critically important.

Technology is having such an impact, also education reforms around the world is a bigger issue, we are getting a lot of pressure on pricing and cost of higher education. There’s also increasing competition and increasing quality of higher education around the world. Being able to manage in this ever changing environment, being able to innovate in it, in the middle of resource-constrains circumstances, it is a true challenge for anybody leading an organization, particularly in higher education.

As emerging economies, especially in Latin America, keep developing and attracting FDI, it is crucial to produce professionals with management skills able to perform at global levels. From the AACSB perspective, is there a perceivable evolution in the quality and competences of business graduates in Latin America? Is there any strategy or initiative or actions that AACSB will be supporting, or leading or contributing to within the next years?

We have already seen a significant growth and development in the quality of management education in Latin America. There are some outstanding schools in Latin America that are producing exceptional graduates. We are seeing an increasing number of schools in that region desiring to participate in the AACSB activities and seminars and conferences because they want to continuously improve what they are doing. I believe we will continue to see the enhancement of quality of programs and graduates.

In terms of strategies or initiatives from the AACSB, we have a task force now looking at how we can best serve management education around the world. We spend a lot of time in focus groups with different leaders from different regions of the world including Latin America. From what we learn, I think we will be seeing more and more tailor offering, based on the specific needs of that region. An example is a seminar we did, our first seminar in Spanish in Latin America. It was very well received, great attendance.

I think we will see a development of the quality, if in a somewhat different way than in other regions of the world.

Hoyt Harper: “Our goal is global personalization”

Posted: April 22, 2014 by jennroig in English, Interviews
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I was in Seattle last March attending the 2014 Sheraton General Manager Global Brand Summit. I was reporting for AmericaEconomia’s print magazine. This is the original, unedited English version of my interview to Hoyt Haper, that was published in its Spanish version by AmericaEconomia on early April. You can now access the full Spanish content online.

HHWhat motivates Starwood’s leadership to conduct continuous research? What are the main research questions and what are some key resulting points?

The reason why we continuously do research is to stay on top of trends and trend-lines. We understand that whatever we create today may not be relevant four years from now. So we are constantly, through our GEI -Guest Experience Questionnaires- learning from our guests. Periodically we conduct research to understand what we have to focus on next.

The Link@Sheraton, for example. When we decided to create this lobby experience, we asked ourselves “does it work everywhere? Do people in all parts of the world relate to the notion of getting out of your guest room?” So we tested this idea in Boston, in Bangkok, in Brussels and in Buenos Aires. We found these ideas and issues are universal. They follow the human truth that is “I want to feel like I belong, I want to feel in control, want to be my best”. There is another human truth that people like to be around other people. So when we executed the lobby experience we did it everywhere.

The other aspect to keep in mind is that we cater to a global customer. So, Buenos Aires is not only a great hotel for locals to travel within the country or the same region. It’s a destination for people from around the world, China, US or Europe. Continuity and consistency of a product is important. People have expectations when they go to a Sheraton and we want to create socially active spaces for them.

Globalization is a common topic, but everything global manifests locally. What is Sheraton doing to achieve a more inclusive image of a client that’s not only linked to a Caucasian-middle-aged-male business traveler?

That’s a very important aspect of our research. Customers are changing all the time. More female travelers, particularly in business such as consulting, high-tech… There’s a world of truly being global. We have an increasing amount of travel from China to South America. There are also great historical connections between Latin America and Europe which fuels traveling both ways. We see these travel patterns, we see our guests changing, so we always need to stay on top of what they need, what’s going to make them feel comfortable, feel at home when they travel.

When I first went to Buenos Aires in 1996, I remember one of my fondest memory is related to the wine shop that was at the lobby of the hotel. Every afternoon between 4 and 6 they had wine tasting. It was not just any wine, but local wines. They are proud of them. They presented them, and conducted the sampling with so much pride. Ten or fifteen years later we are looking at leveraging wine as social beverage and recreating that atmosphere, that experience. Giving our hotels in different countries the opportunity to promote their local wines, making the event locally relevant. Same thing in Chile.

Sheraton is a global brand with hotels in all the different countries and regions, does it consider alliances with local or regional partners, representative brands from specific locations?

It depends. For example we work with Starbucks worldwide now. But five years ago that wasn’t true. The acceptance of Starbucks in Asia or Europe wasn’t as strong as it is today. Now you can go to Eastern Europe and find a Starbucks, you can go to the Great Wall of China and there is a Starbucks.

If there are opportunities to create a more local experiences by working with local operators, that happens too. It depends on what product is it. Dining is an opportunity. I ate more red meat in Argentina than every country I visited before, because it tastes so differently than what I was used to, because of the way it was prepared.

Our guests want local culture. You want to get off your plane and feel like when you get to the hotel you will experience the destination. That’s important to us.

But there are other things. Our customers feel a sense of comfort in knowing that when they get to a Sheraton hotel they will have a Sheraton suite sleeper bed and it will be that bed they are familiar with no matter where they go, that they will have high quality bath amenities, that they feel safe and secure, those are things that are associated with Sheraton. It can also be very practical things, that we have staff that can help them to facilitate a meeting, or help them enhance their social or leisure experience. All those things we want people to expect no matter where they go to a Sheraton in the world.

An orientation toward a more tech-friendly environment is visible, the will to make it easier to connect, to access the hotel services and people from online platforms and mobile devices. Is it part of a strategy that targets Millenials? Is it about rejuvenating and bringing diversity to the Sheraton’s image?

We use technology as an enabler. We use it to connect with our guests more efficiently, to store and pull data. Customers give us data for the sole purpose of us enhancing their experience. It should be easier to connect a phone call with us, it should be easier to make a reservation with us, it should be easier to check in a hotel with us. If I give you information, I expect you will deliver a higher level of service to me. I want those amenities in my room. We normally put still water in rooms, but someone likes sparkling water better, or not necessarily wants to have cheese and wine in the room. So why not to save the money and provide something more relevant to me?

Those are the things we do by leveraging technology. We have technology that it’s guests facing. We are now developing a digital wine list. That becomes important because the availability of the wines changes quite frequently, based on popularity, supply, among others. We might have a special offer that isn’t normally on our list; on the digital menu we could change it in an instant. The customer may want to know more about the wine, then it would be useful to offer an option for video or text content with further details.

Moving into a digital age allows us to provide more information. You may want to rate our wines; we have professional ratings but everybody’s tastes are different. So having guests tell other guests which wines they like the best is information and it makes it fun and interesting.

Technology will touch almost every aspect of the guest experience, from how you make your reservation to how you communicate with us at arrival, making us to know when you will walk in through the door so we are on time delivering your amenities. It will touch the way you communicate with us during stay. Before picking up a phone you may just want to send us a text because it’s more convenient, or asks us something…

We are also looking at ways to create more self-service. You can help yourself to a cup of coffee, or a single glass of wine. We have automated wine dispensers that we are testing now and we could put in our club lounge. There are lots of ways in which technology will touch the guest experience and we want to be cutting edge.

It was announced that Sheraton has enabled a specific website devoted to Chinese travelers. Is it there any difference in the message Sheraton wants to convey to different regions of the world?

We want to speak to our guests in the language of their preference, through the channel of their preference, whether it is phone or text, or website, or social media, we want to be responsive no matter the channel the guests will select.

We have an elaborate program to handle Chinese travelers going to other parts of the world, that relate for example to different food items. They are also more likely to wear slippers so we provide it in the rooms. They are not as accustomed to the social gathering places we create. So we are creating opportunities for them to interact in a setting they feel more comfortable. Same thing is happening with India, as India becomes a big outbound travel market. It is also about providing training and cultural awareness to the associates. It involves education, information to our associates, which will help us deliver more relevant services and make people feel like they belong.

There are also differences we find among the genders, not only cultural. There are certain items some gender values more… We all value to feel safe and secure, but there are some items women care about more than men. For example, the idea of having an adjoining door, women don’t feel comfortable with it. But we have guests who ask for the adjoining door because they are traveling with their children. Actually some guests don’t want it for the noise factor.

We have to cater to all different types of customers. We have airlines crews and they have their own inspection process focused on security and safety. There’s a lot that goes into our big bookings and operations of a hotel.

We are careful not to make assumptions. We prefer to ask questions and have that dialogue with the customer.

Are there any particular strategy or future projects designed for Latin America? Are there any plans to change ownership of assets and keep the brand and management fees?

We have an asset light strategy. That means we are primarily in the business of managing and franchising hotels.

That being said, we are always looking for opportunities to enhance our portfolio in properties, which might mean an acquisition or an opportunity to sell anything at the right price. The real state is something we are always mindful of. We just spent 55 million dollars renovating the Sheraton in Rio. It will be in its best shape in two decades, getting ready to welcome the World Cup in Brazil. We have new openings in Recife and Bolivia. So our portfolio continues to expand. Buying and selling hotels is something it’s done on opportunistic bases. There’s no strategy to sell anything at this point.

Schultz: We have to make a difference

Posted: April 16, 2014 by jennroig in English
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Starbucks CEO Howard Schultz

Starbucks CEO Howard Schultz

On March I was in Seattle to cover the 2014 Sheraton General Manager Global Brand Summit. An assignment from AmericaEconomia I gladly welcomed. I learned there that Sheraton holds alliances with Starbucks among other companies. So the organizers had Howard Schultz, Starbucks CEO, as a keynote speaker. I attended his session. The way I perceived it, Schultz’s word separate from other motivational speeches meant for business people.

These are some fragments.

(…)

…Let’s imagine there are two Starbucks stores, each across the street. One is owned and operated by Starbucks and the other one is an independent franchise -we don’t have that but let’s assumed- owned by somebody else. The one owned and operated by Starbucks, the management is not doing well. But once you get 20.000 stores, what’s the big deal if it doesn’t go that well that day. The problem is that it is a bog deal because that is what has been doing for quite a while.

For quite a while it has allowed mediocrity to create a level of behavior that has replaced greatness and excellence.

So, when you are kind of tired and the line is long and you see somebody walking out the door because the line is too long and the service isn’t great, what is it that you do? Most probably, you think is not that bigger deal. Starbucks served 70 million people just last week.
But let’s look at the store across the street which is owned and operated by one person. His family, his school, his livelihood is directly related not to 20 thousand stores but one store. Do you know what he does when somebody leaves the line? He runs from behind that counter and he tackles that guy. He gives him a coupon and he ensures that there’s a level of intimacy and concern and sensibility –direct emotional concern that says I apologize, please give us another chance.

The difference between the store owned and operated by Starbucks and the one that is operated by this person, it is very simple: that is what it means to take it personally, what it means not to be a bystander and the understanding that we are not in the business of 20 thousand stores or 70 million customers or 500 properties; we are in the business of one thing, one intimate moment: that is the fragile relationship between the customer, the Starbucks’ person with green apron and an extraordinary cup of coffee. When that breaks down, we have to do everything humanly possible to elevate the experience.

In front of 11 thousand people, what I have to say is: this is a time in our company when we cannot embrace mediocrity, we cannot embrace the status quo. We must push for reinvention. We must understand the value of one customer, one cup of coffee and one human experience. Whether or not you have been at the company for one month or one year, or ten years or twenty, this is the best time in the history of Starbucks to be with the company. Why?

Because we are in the position to control our own destiny. We are in the position to build a great enduring company. But our subsistence and what we have been doing for the last 20 years is not going to cut it, it has to be earned every single day by people who understand what passion is all about, what greatness is, the difference between mediocrity and excellence. And I also say something that is a little bit politically incorrect, but something I believe in: business is a team sport, but not everyone deserves to be on the team. Especially when you are working with small teams and one person can create a carcinogenic behavior.

As leaders, if we allow that behavior to take place, then we are wrong.

(…)

…We are in the people business. Not all companies are as dependent as we are on human behavior, and leadership, and management of small teams. We also have the responsibility to ask a question and answer it in the affirmative: what’s in it for our people?

People today are working for not very high choices. The burden that it puts us all is to demonstrate truth, transparency…

There’s a lot of noise in the marketplace right now about technology, and rightfully so. Starbucks has invested tens of millions of dollars in all kinds of consumer-facing engines. That puts us in the forefront of the customer experience. Social, digital, mobile… as result of that we are winning in the market.

Let me say something about that, which I think it’s important: there is shift in America in terms of consumer mediator. The Amazon effect, all e-commerce, it all means that more and more people are spending more time on their desktops and on their mobile device than physically walking the streets as pedestrians in America. Less time shopping, moving around, more time at home. That considerably affects our businesses. This week we saw two companies, Staples and Radioshack, having to significantly cut down operations. What technology can’t replace, and kind of the death of distance because of the web, is the ability to look at someone’s face, that deep sense of humanity. When you walked into one of your hotels, or into one Starbucks stores, and you find people generally interested on who you are, as a human being not because you have money on your wallet, they will have an effect on you. It will enhance your day. We are longing as people for a deeper sense of humanity, we are longing for human connection.

The Starbucks brand has not been one to rely heavily on marketing. People asks us how much money we spend on marketing and we answer that we are not a marketing company. The equity of the brand has been created out of elevating the human experience. Our people have created in our stores an experience that brings the people back.

When we did that right, we created separation in the marketplace.

(…)

We also have to understand that what we have done up to today, as good as it is, as successful as it is, it’s not going to be good enough for the future. It’s not because of technology, it’s because we have to constantly push ourselves to reinvention.

(…)

A few years back I had the chance to meet this extraordinary and very wise that happened to be this very religious rabbi. I’m Jewish, but I’m not a religious person. But I met this rabbi and it happened that we were together with a meeting group of businessmen.

The rabbi said: “tell me the meaning of Holocaust”… Of course, nobody wanted to make mistakes so everybody kind of look away. Then he asked again: “tell me the meaning of Holocaust”…

The rabbi told us a story -and this is not a story about Jews but about Humanity- “during the Holocaust as we all know, men and women were transported in the worst possible conditions, during the winter months, in journeys that took 12, 24 hours, sometimes 3 days. When they finally reached destination, men were separated from women, women then were separated from the children. As they walked into the camps, the death camps, only one person in six was given a blanket. What is that person going to do?”

He said: “Not everyone, but most people, shared their blankets. So, that’s the meaning, what you learn is that you have to share your blanket”.

I use that as metaphor for what I believe we need to do as businessmen: it’s not enough to make money, it’s not the only reason we are here. The reason we are here is to improve the lives of the people in the communities you serve. Sharing our blankets.

We live in a country today where we all can probably say that there are things that aren’t going quite right. Whether you are a republican or a democrat, it’s something in the air that doesn’t smell alright. I’ve spoken out a great deal for the 15 months ago with people in Washington and I’m concerned.

I realize more than ever that we have a stake in this. We have to make a difference. We can’t wait for Washington.

What I say to you, as you’ll go back to your respective area, please understand the relationship that we are building with our people, with the communities we serve and the difference we can make. Understand the power of love. Understand that this is a team game. Understand that success is not an entitlement, it’s something we have to earn everyday.

Language is important. Language has a meaning. It’s not enough to say the word greatness or excellence. It corresponds to a behavior that has to be modeled, a behavior that has to be celebrated.

(…)

For the last 10 years, we have been fighting a war in Irak and Afghanistan. Two and a half million people have served. If I ask you, how many people in this room have been affected by the war? Probably it’s about 10%. Over a million people are coming home. They need our help. This can’t be Vietnam. They have to be celebrated.

And they have extraordinary skills and are extraordinary people. Hire them. Support them. It’s not enough to go to the airport and shake their hands while saying thank you. We have to help them.

Parasuraman: Service Excellence

Posted: December 16, 2013 by jennroig in English, Interviews
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Prof. A. Parasuraman, UM

Prof. A. Parasuraman, UM

A. Parasuraman teaches at the University of Miami Business School. Among his research goals, it is key to understand the elements that shape the market’s perception over some product, service and ultimately companies, which could also make the difference for business against competitors.

This is the original, unedited, English version of the interview to prof. A. Parasuraman that has been published in Spanish by AméricaEconomía, on December 16, 2013.

Globalization brings along diversity to the demographics of cities and countries. For companies that operate within these increasingly diverse environments, what are the biggest challenges in terms of service excellence?

The world is becoming smaller. Consumers around the world are becoming increasingly aware about what’s available on other parts of the world. I think there’s a general increase of the knowledge of consumers across different countries and different cultures.

To some extent, one can also argue that globalization is also reducing diversity. Nevertheless, markets are getting diverse. For example, in China are a lot of people that are moving to the cities and I’m sure the same is happening in Latin America. Urban population is increasing which brings a growth in the diversity of markets.

In relation to the issue of Service Excellence, among the biggest challenges is trying to understand the aspects of service that will appeal to different segments of customers.

What customer service really means is a very simple proposition. It is something that customers believe really superior companies should provide but often don’t provide. From a customer’s perspective, service excellence can be defined as the gap that exists between what we believe excellent companies should be able to deliver and what a given company within a particular sector is in fact providing. There’s typically a discrepancy between those two.

Studies show that customers’ expectations vary across places, segments and cultures. So that’s why that’s among the biggest challenges.

My own research also suggests that regardless of the type of service, and the part of the world, there soma basics all customers expect.

I think these basics can be summarized in five dimensions. So came up with a method to try to find the discrepancy. The basics underlying are:

One is tangibles, which refers to the appearance of the facility, of the people, appearance of the communication materials that customers receive and so on. Everything that is visual.

Se second is reliability. It has to do with the ability to deliver the promise of the service accurately.

A third component is responsiveness, which has to do with speed of the service and also a general willingness to be helpful to customers.  It addresses the way service employees behave with customers, implying that they really care and they actually want to help.  A lot of times customers feel like having to interrupt employees to get our questions answer or get services delivered, because they seem to be so busy or seem to be doing something else. That suggests a lack of responsiveness.

The fourth component is what I call assurance. This has to do with the courtesy level the employee shows to the customer. The employee is suppose to inspire in the customer the feeling of confidence, so they feel reassured that they are dealing with a responsible and capable organization.

The last component is empathy, which has to do with the extent to which a company and employees do understand what the customer wants and need. They can put themselves in the customers shoes.

They are basic and intuitive dimensions. That’s why I argue that these categories are universal. What might differ from a region to another are the specifics related to those broad categories. For example, if you take responsiveness in the USA, people generally tend to be more impatient. The actual speed of the service delivery might be more critical than let’s say in Latin America where there’s probably more tolerance toward time delay. Instead the willingness to be helpful to the customer probably will not be that different.

There might be some nuances in relation to the categories from country to country and among cultures. For example, if you take McDonalds that is a universal brand, in the USA 70% of the sales occur through the drive thru window, without entering the store. I understand in the vast majority of Latin American countries the sale occurs in the store. The customer goes to the location to sit down and eat. So when contrasting these different operations, it could be said that the appearance aspect of the store is more important in Latin America. Instead in the USA this may be less important than getting the orders correctly, because the customer is waiting the product and doesn’t want to find out later that the product is wrong. These differences need to be managed. Really good companies take this into account when designing the service strategy.

Having that level of understanding is a big challenge for companies that operate globally.

How does UM Business School help business students to understand what the elements of excellence in service are?

At UM we have a unique advantage. One is that the region of South Florida is dominated by service companies. So we have logistic companies, cruise lines, insurances, healthcare services are really big. The context for the students is dominated by the service industry. Thus they are able to explore very different types of companies within the service sector.

In terms of what the UM B-School specifically does to inculcate concepts related to service excellence, there are programs at our graduate level, the MBA program and also the Executive MBA program, and also among the executive education programs which include courses of service excellence and service marketing.

The subject is also among the research guidelines. We speak about a number of concepts and frameworks and measurement approaches to systematically studying how to improve the quality of service.

The idea is to find out what service quality gaps customers are experiencing. It measures the customers understanding of quality of service. We also have done a lot of research inside companies to find out the reasons of this gap.

It is suggested that there are a series of major basic organizational gaps within companies that affect or contribute to the quality of service gap.

The first internal gap is Market Information Gap. This is a lack of understanding in managers about what customers expectations really are. That leads to misallocations of resources to areas that are not really relevant to customers.

The second is the standards gap. In a lot of companies, even senior managers have at least some understanding of what customers want but they don’t translate that knowledge into specifications. There’s a lack of standards for service delivery. In other words, there’s some knowledge somewhere in the organization about what the customers want but that knowledge doesn’t get translated into systems that could actually help improving the quality of service.

The third is the service performance gap which occurs due to a disconnection between what are the internal standards that could be in place and the actual delivery of the service. Returning to the reference of McDonalds, it has a lot of internal standards of service, but it has problems with the delivery of the service. You need the proper infrastructure, technology in place, trained employees, so the connection exists between the standards and the delivery.

The last gap is a serious problem today, and it is a lack of internal communication, a lack of coordination across different functional areas to which customers could potentially interact.

In a lot of companies there’s a lack of communication between the advertisement people that make promises that can’t be delivered by the employees in the operational area of the company.

My main thesis on this gap model is that to truly improve the quality of service and the customer experience externally, to close the expectation-perception gap, companies need to systematically study and improve the internal gaps.

Coming back to the question, in the courses we teach there are details about these issues affecting the quality of service. Courses and programs are going to talk in detail about these frameworks and what companies can do to improve the service to customers. These courses are not common in business schools.

Due to the increasing importance of providing an excellent experience to the customer, is it a trend for companies to create new job positions to focus on this area?

It is definitely possible. In many companies are interested in improving service excellence. The problem that I see it’s there’s not enough understanding yet about what service quality really means from the customer’s perspective. And what needs to occur inside the company to produce those external market efficiencies.

There’s the interest, and the investment in resources, but customers actually don’t see a lot of change. For instance, sometimes you go to a hotel and there are nine pillows on the bed, but the employee calls you later than the hour you asked to be woken up in the morning.

There’s a lot of competitive imitation. In the moment a company offers a new service every other company tries to do the same.

Still few companies appoint someone to take care of the service to the customer.

In terms of the use of technology and all social media, a study conducted by Duke University’s faculty found that among CMOs there’s no certainty about the real impact of social media investments on the performance of the business. What are your thoughts about it?

These are very interesting findings. It agrees to some of my own thinking. Many companies now are enamored with social media. Everybody talks about Twitter and there’s a lot of coverage about these new networks. Companies feel pressure to invest in this sense, creating a facebook page, a profile in other social networks. Companies in my view blindly imitate each other.

But no one has really understood the real impact of all that. My own feeling is that there’s too much hype around the influence of social media. At this stage, most companies are just imitating each other.

I recently came across the book: Contagious, by Wharton school professor Jonha Bergr where it says that much of the communication p2p occurs through word of mouth rather than through social media.

How could a startup or SME design a much better experience for the customer?

My view is that SMEs especially the ones that are starting have a great opportunity to make a big impression on customers. That is because they don’t have all the infrastructural problems, or corporate cultural problems that these big organizations have.

I think the gaps are likely to be smaller in the SMEs because the organization itself is smaller.

There’s opportunity for better communication and the coordination among functional areas.

With the economic growth perceived in several Latin American countries, there has been an increasing relationship and investment from US companies there, and Latin companies in the USA. From your perspective, what are the most important difference you notice between the way Latinos provide services and the way North Americans do so? What should these companies, from each side, consider in order to satisfy customers from a diverse cultural background?

I get asked that question ofte, about country-to-country differences in terms of service excellence.

I start answering this question by saying that the basics are the same. In my view, regardless of the country, the basics don’t change. It is important to realize the specifics associated with the basic categories, such as understanding the market place through research and observation. What might work in a country does not necessarily work as effectively in another country. A good understanding of different expectations of customers is important.

Another option for companies moving into foreign countries is to feel they can make some local partners. Local companies will be more aware about expectations and cultural expectations. Create local partnerships can be a way to quickly get the understanding of the needs and expectations of the new market.

In conclusion, companies across the board are focusing on service because it’s what can distinguish them from the competition. It is difficult to achieve competitive advantage based only on product. There are so many brands available that it’s difficult to achieve advantage based only on the service or the product. Likewise, you can’t compete on price, because it’s something that can be easily match. Whereas excellence service is something that can bring the opportunity, it’s a way to achieve sustainable competitive advantage. It may require initial investments, but it will be worthwhile.

Anderson: why do we need the multicultural executive?

Posted: September 16, 2013 by jennroig in English, Interviews
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This is the original, unedited version, of the interview to University of Miami’s Business School’s Dean Eugene W. Anderson, published in Spanish on AmericaEconomia on September 8th, 2013. The interview covers the new “Miami Executive MBA for the Americas” program, which aims to be the new flagship program of UM B-School.

Eugene W. Anderson: UM Business School Dean

Eugene W. Anderson: UM Business School Dean

Among so many MBA programs out there, what would make this program relevant for Latin American executives who aim for a second time in academia to update their skills and knowledge? What are some distinctive features of this program “Miami Executive MBA for the Americas”?

We are hoping that this program is that program. The one program Latin American executives who want to go back to school want to be a part of. As far as I know, it is really going to be the only program out there that has uniquely taken as its focus doing business in Latin America, in the Americas. I think it’s such an important high growth area of the world.

Then most MBA programs have a very traditional structure and are organized around specific functional areas like accounting, finances, and marketing. And most MBA programs are using the same text books and cases, which are all very are all very US based, US centric. This programs aims to be very different. Instead of having a functional structure, we are going to try to focus on the issues that are important to managers and organizations doing business in the Americas. It’s about multicultural leadership, it’s about entrepreneurship, and innovation, managing international and global operations.

Attacking anyone of those individual areas, doesn’t fit neatly into the disciplinary box of any particular functional area, real business problems, real business issues are multifunctional, cross-functional. So we are designing the program around those issues and specifically around issues that are important to folks working in Latin America. We are going to provide that as architecture, and then the students are going to be bringing current problems and issues they are facing in their businesses into the classroom. In fact, they are going to create the cases to be very current and also based on the geographies they work on and are doing business in… instead of analyzing ten-year-old cases that are based in Iowa or something like that. In that regard we think that we are taking a very different and unique approach.

I think the result would be a really terrific program for anybody who wants to up their game and learn more about doing business in Latin America. And also, there’s not only the intellectual content, but the opportunity of peer interaction, the friendships and networks that will be built in the program.

We are hoping that people graduate from this program and walk the stage feeling that they are not only prepared to be great managers and leaders of their companies in Latin America, but also have a much broader view of the different cultures that are there, and of themselves, so they will feel more multicultural. And also they can feel they have created new networks of colleagues across many different countries, because we are hoping to draw students from Mexico, Colombia, Panama, Brazil, some of the Caribbean and certainly some from South Florida. We are hoping we will help these people to develop a powerful network which will benefit their career on the long term as well.

You just mentioned the program would use cases brought to the class by the students, considering their experiences, what exactly does it mean?

We hope that they will bring current business issues and things they are facing. For instance, maybe some of them will be working for a family business in Colombia which is seeking to entering Peru.

In terms of methodology, how are the professors going to be prepared for the challenge, considering they will have less time to prepare for the analysis of the cases?

First, we are going to be using our faculty that are most seasoned. They are not only used to working with executives but also are used to work in these markets so they will have a deep understanding when the issues will come in.

The other thing that will be asked from the faculty is that instead of being the proverbial sage on a stage where the professor knows the case, what questions to ask and what kind of answers will get, the faculty members will be more of the guide by the side. They will be working with the students to help them formulate the right questions to ask, to help them think about how they want to answer those questions. So everyone together can learn and discover what the most current issues are out there and what the best approaches are to try to address them successfully.

My hope is the faculty will be learning a lot in this program from the students too. That should be because when you have seasoned executives, people who have been out for 10, 15 years, they have a lot to offer when they come in the classroom. If you are using a traditional teaching model, where the students are listening to the faculty member who knows everything, walks in to kind of to project to the audience the knowledge that they received, that may work ok with a classroom of undergrads, but if you have a group of 30 or 40 executives with 10 to 15 years of experience, then you are really missing out by not tapping in all that experience and knowledge that is sitting there in front of you. If you have a classroom with 40 people with 15 years of experience, you have 600 years of business experience in front of you. If you stand there and lecture them with power point slides you are not going to tap in that knowledge and experience in the way that you would learn as a faculty member. But more importantly, how the other folks on the room are going to learn from each other, we expect a lot of peer to peer learning in this program.

Who are the potential students? Will the program target some specific kind of executive, with expertise in certain areas or specific time of experience on the job?

We rather like to stay away from saying specific numbers or thresholds for the folks. We rather have been thinking how it would be the ideal professional, man or woman, for this program. How he or she would be like.

If you think in admission on the individual level, we would be looking for people with really high potential, with a track record of success, probably a record of progressive management responsibility.

But also their colleagues and their superiors, as well as to our interview, we determine how high potential they are for senior level positions. Our ideal folks would be the people that their organizations view as their future leaders. That’s kind of what we are looking for at the individual level, so whether or not the person has 8 years experience or 15 years experience, that can probably vary a lot from person to person.

There’s other thing we are going to be looking for when it comes to admission, it is the creation of a group. If we have 25 managers from Bogota in the classroom that’s going to make the conversation different than if we have 5 from Bogota, and 5 from Panama city, and a group from Lima, and somebody else from Puerto Rico… We want to have a real diversity of perspectives in the classroom. We like to think that we are not only looking for people that have the ability to learn, which is kind of the first part, that they demonstrate they are high potential people, we are also looking for the right group of people that have the ability to teach, because we want them to be able to teach each other in this program.

It is likely that the program will gather two kinds of students, some will come from the USA with intentions to go to work in Latin America, while others will come from Latin America with the interest of learning about other Latin American countries but also about the USA. From the program’s perspective, how will be tackled these two specific needs from both subgroups?

Those are exactly the two groups that we want in this program. We think we have a lot to teach to each other, one group about learning how to do business in Latin America, and the other group learning about doing business here in the US, and both getting an opportunity to develop networks in places where they want to go to.

We think the program is going to have the most value if we get a good representation from both these groups. Now, what are the big themes of the programs? And how can these groups take advantage of the program?

One of the big themes of the program is multicultural leadership, so certainly we are going to want people to learn about, for example, what the cultural business practices are. For instance, some of the people who can be 4th generation US citizens, they still have a lot to learn, even if they grew up here in Miami which is very multicultural, they still have a lot to learn about doing business, or the cultural side of doing business that is interacting with folks in Lima, Santiago, or Sao Paulo, and how these places are different from each other.

Something that inspired this program was listening to businessmen who have dealt with these differences expressing that they wish to have had better preparation over the cultural differences, in the societies, in the way business are conducted in these different countries… because one would be not only living and managing an organization in a foreign country, but overseeing the entire let’s say Andean operation, which includes countries like Ecuador, Colombia, Peru and Chile.

I think that’s a very important goal we have for people who are coming from the US to learn about Latin American context, and vice versa for managers from Latin America to learn about US culture. And hopefully we will learn from each other, because one thing I hear from talking to business leaders in Latin American countries when I have visited Bogota, Sao Paulo or Lima is that they want to do with their management talent is help people that are very focused on their own country to learn more how to be multicultural within Latin America. The Brazilians have grown up learning about Brazil and doing business in Brazil, but more and more if they want to take the next step and become multinational –and often the first step in becoming multinational is to enter a neighboring country’s market- so they need to learn how to take those steps.

At this point, is there any definition or particular interest regarding a particular country, or even city, and also industries, developing in Latin America that you consider as indispensable to be addressed in the program?

In that sense, we really like to make sure we gather a good mix of people coming from the different major business centers in Latin America. Ideally we would like to have a good representation from places like Bogota, Lima, Panama City… those would be very important for us.

In terms of industries and verticals, considering we are in Miami and what the city has become, I’m sure there will be a strong financial services aspect to the program. There are so many financial services that have been based here for the Latin American operations. I don’t think that it will be limited to that. I expect we will have a good representation from the many other kinds of services and consumer products companies, the healthcare companies, and so on that have put their Latin American headquarters here in Miami.

The other group that is not precisely a vertical, but we would also like to have a strong representation of in the program, it’s people coming from family businesses, all the way across the board, because that’s such an important part of the business world in Latin America. So we want people that are into family business and people that are not, especially from the US side, they need to learn what all that is about in Latin America.

Will the program somehow address the kind of particularities that can affect the executive’s performance which are not part of the office work, but are embedded in the context?

Absolutely, we really want to focus on not just navigating new cultures, but different government rules, regulations… the different kind of socioeconomic, legal, political things that you come across. That is a very important part of it.

We will tackle topics related to international contract law and compliance, which is a big issue especially in healthcare and in some other financial services as well. One of the points of focusing on making sure we are getting good representation from some of the major business centers in Latin America, it is to have people in the class who can share with people interested in moving to Sao Paulo or Lima some of the challenges that they will face not only in the business sense, but also on a personal level as well.

Are there any plans to foster the participation of students from Latin American countries with scholarships or grants of some kind?

Yes, one of the things we would like to offer for students who are really great is that there could be chances of financial aid. We could certainly consider merit scholarships. We have started initial conversations, still when we are a year away from launch, but we are talking with corporations who might be willing to help support this.

As you can imagine there is already a lot of companies that are multinationals, either coming from Latin America and are based here, or multinationals from elsewhere that try to go to Latin America to have operations there. This could be a very attractive program to them to help develop talent that is capable to be fluid and moving back and forth between these two different worlds.

 The program will blend the on-campus experience with the online learning format. Even today, there are not many Business Schools adopting the online learning variant. Why has UM decided to adopt it? What are the expectations in terms of potential challenges and benefits?

There are an increasing number of schools which are adopting online variants of learning formats. Maybe they are not going fully online, but there is an increasing number offering hybrid formats like we are doing. Some of them are quite prestigious schools like Duke and the University of Michigan, which have hybrid programs for 10 years now.

I think that it’s a growing trend in business education, and I think there are some great benefits to doing things at a distance. Part of it is that there’s so much work these days is done virtually by people working at a distance in virtual teams, that I think it’s essential for business education to include that in the experience we are offering to our students, so they can learn more about virtual collaboration and how it works.

I think it’s an important benefit of distant learning. I also think that online has some real strength, you get great consistency because people can go at their own pace. But also if set it up right they can have great collaborative experiences within their smaller groups, and working with the professor in small groups that they will never get in a classroom with 50 other people.

For instance, in a discussion around a certain issue, in the classroom would only have the chance to ask a limited number of people in an hour, but if you do it on an online environment where the professor can connect with 8 or 10 other people, everybody better get prepared because everybody is going to get the chance to talk and be called by the professor and will have to interact with the other folks.

Then I believe there can be real benefits to the online environment, though I don’t think online has gotten to the point where it can fully replace the richness of the experience of bringing people together in a face to face interactions do. That’s why the blend of the experiences is very important for us.

That’s from a learning perspective. The other I think importance thing about a hybrid format in today’s world it’s that gives people flexibility in their very busy lives. It’s a very fast paced, interconnected world that we are living right now. If you are in a program where you are expected to come to campus every two weeks for a couple of days, it’s more restrictive considering both your professional and your personal family time than a program like this where your commitment is to come once every two months. It helps you to balance all the competing demands you have at work and hopefully help people achieve a work-life balance while they are going through one of these programs.