Loyalty Rules!: How Today's Leaders Build Lasting Relationships
Building Loyalty: The Acid Test of Leadership Fewer than half of today's employees believe that their companies deserve their loyalty. Web-empowered customers now defect more easily and more quickly than ever. Has loyalty become an outdated notion in today's marketplace? Fred Reichheld, author of the bestselling book The Loyalty Effect, argues that loyalty is still the fuel that drives financial success-even, and perhaps especially, in today's volatile, high-speed economy-but that most organizations are running on empty. Why? Because leaders too often confuse profits with purpose, taking the low road to short-term gains at the expense of employees, customers, and ultimately, investors. In a business environment that thrives on networks of mutually beneficial relationships, says Reichheld, it is the ability to build strong bonds of loyalty-not short-term profits-that has become the "acid test" of leadership. Based on extensive research into companies from online start-ups to established institutions-including Harley-Davidson, Enterprise Rent-A-Car, Cisco Systems, Dell Computer, Intuit, and more-Reichheld reveals six bedrock principles of loyalty upon which leaders build enduring enterprises. Underscoring that success requires both understanding and measuring loyalty, he couples each principle with straightforward actions that drive measurement systems, compensation, organization, and strategy: Play to win/win: never profit at the expense of partners. Be picky: membership must be a privilege. Keep it simple: reduce complexity for speed and flexibility. Reward the right results: worthy partners deserve worthy goals. Listen hard and talk straight: insist on honest, two-way communication and learning. Preach what you practice: explain your principles, then live by them. Vivid case studies illustrate the consequences of building or ignoring loyalty, and a rigorous Loyalty Acid Test (www.loyaltyrules.com) enables leaders to benchmark their loyalty practices against competitors. Providing tools for implementing the timeless principles of loyalty in a volatile economy, Loyalty Rules! is a practical guidebook for taking the high road in business-the only road that leads to lasting success. Fred Reichheld is a Director Emeritus of Bain Company and a Bain Fellow. He is the author of The Loyalty Effect as well as of influential articles in Harvard Business Review and the Wall Street Journal. His work has been featured in leading publications including the New York Times, Business Week, the Financial Times, and The Economist.
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LibraryThing ReviewUser Review - markdeo - LibraryThing
Really good principles on loyalty. A very good attribute to learn and understand in business. Great insight on the "Loyalty Effect". Very good for communication. Will help you get in focus. Learn how to understand your customer. I recommend. Read full review
just finished the book...loyalty requires a major makeover in the 2000's...let me explain...Business and the public sector are into a phase of creative disassembly where reinvention and adjustments are constant. Hundreds of thousands of jobs are being shed by United Technologies, GE, Chevron, Sam’s Club, Wells Fargo Bank, HP, Starbucks etc. and the state, counties and cities. Even solid world class institutions like the University of California Berkeley under the leadership of Chancellor Birgeneau & Provost Breslauer are firing staff, faculty and part-time lecturers. Yet many employees, professionals and faculty cling to old assumptions about one of the most critical relationship of all: the implied, unwritten contract between employer and employee.
Until recently, loyalty was the cornerstone of that relationship. Employers promised job security and a steady progress up the hierarchy in return for employees fitting in, performing in prescribed ways and sticking around. Longevity was a sign of employeer-employee relations; turnover was a sign of dysfunction. None of these assumptions apply today. Organizations can no longer guarantee employment and lifetime careers, even if they want to.
Organizations that paralyzed themselves with an attachment to “success brings success’ rather than “success brings failure’ are now forced to break the implied contract with employees – a contract nurtured by management that the future can be controlled.
Jettisoned employees are finding that the hard won knowledge, skills and capabilities earned while being loyal are no longer valuable in the employment market place.
What kind of a contract can employers and employees make with each other? The central idea is both simple and powerful: the job or position is a shared situation. Employers and employees face market and financial conditions together, and the longevity of the partnership depends on how well the for-profit or not-for-profit continues to meet the needs of customers and constituencies. Neither employer nor employee has a future obligation to the other. Organizations train people. Employees develop the kind of security they really need – skills, knowledge and capabilities that enhance future employability.
The partnership can be dissolved without either party considering the other a traitor.