The most amazing fact that the finance department figured out at Zappos was that the lifetime customer value is on average $200. But if you cross-reference that data with people who called in had a problem and got it resolved, that lifetime value went up as much as six times. Hello and welcome to Conversations with Zendisk. I'm your host Nicole Saunders. We have a really great episode for you this week. We captured it live at Zendisk's Relate Conference in Las Vegas earlier this month. We had a truly fantastic week where we heard all about Zendisk's AI innovations, heard from some amazing keynote speakers, and had a lot of fun connecting with our community. Today you'll get to hear an interview that I did with keynote speaker Robert Richmond, author of the Culture Blueprint and co-creator of Zappos Insights. Zendisk's AI technology is a true expert in how to build the kind of company culture that can really propel your business forward. We discussed how a company's culture influences its customer experiences and how AI fits into that picture. But before that, we spent some time on the Expo floor taking you to our event and hearing what attendees had to say about the future of customer service and their biggest takeaways from the event. We'll dive into all of that in just a moment, but a quick reminder to follow Zendisk on
[email protected]/li. You should also check out today's show notes where we've got links to all of the on-demand relate content where you can catch Robert's keynote as well as several other sessions from the conference. All right, let's head to Las Vegas. So I've got a fill in the blank question for you. Okay. Future of customer service is human. I love it. The future of customer service is. A wild frontier, because I think it's changing very quickly. And I think that things like AI and I think tools like Zendisk are going to be critical to doing that in a new way. The future of customer service looks like. More automation with agents focusing on critical cases. I would say it looks like a mixture of human and computer, like, together intertwined. I don't think AI will take over everything, but I think we're going to see a nice harmony between the two. Meeting people's needs, but also being efficient. I'm going to say effortless, the future of customer service looks night at breeze. Is that too cringey? Does that work? I have a habit. Interesting. Exciting. New. Human. We've been talking a lot this week about the idea of the customer as always human. What does that mean to you? Well, we're thinking about a customer conversation. It really comes down to helping another human. And the AI just gives us the ability to do that faster, better, stronger. And the other human having a rough day, stuff's not working out. And giving them the benefit of the doubt that they might be a little frustrated and be like, "I've been there." The human element of personal relationship is going to be key for a long time to come. Being able to connect with a human being on a level that is personal is equally as important or probably more important than having their questions. We can use AI in an efficient way and make our doubts easier, but we also need to have a human interaction that needs to feel real. I saw that and I kept thinking, "What about companies that work with pets?" Well, maybe in the future, right? I think it's just taking a step back and realizing that everybody has things that they can use assistance with. It's going to be relatable. It's going to be easy to use. And you've got to treat the customers still as if they are the most important person in the world. A huge thank you to Ashley Gertz, Mike Davis, Brandon Tid, Dan Cooper, Heather Rommel, Randolph Beaton, Michael Lucricio, Kevin Ballam, and Jake Samson for sharing their thoughts with us. All of this conversation around how we keep our focus on the human side of customer service while bringing in new automations, bots, and AI to our customer interactions fit in perfectly with keynote speaker Robert Richmond's area of expertise. We had a great conversation about all of this and more. I definitely recommend that you listen with a notebook handy. Here's that interview. Robert Richmond, welcome to Conversations with Vendez. How are you today? Doing great. Thank you. Have you had a good time here at Relay 24 and Las Vegas? Oh, yes. Fantastic. The events have been just great. Awesome. I'm so glad to hear that you've enjoyed it. I know I've had a great time myself. So, to get started, I would love to have you talk just a little bit about your point of view on customer experience and company culture and how those two inter-- why is it important to have a strong company culture? Yeah. So, the idea behind it is that it's the people who are really driving the experience. And so, if you have a culture of service and mind you, not a culture of customer service, a culture of service itself, meaning-- Oh, distinction. Important distinction, meaning you're of service to everyone around you. That means bosses, co-workers, colleagues, vendors, because that means you don't have to just suddenly turn it on for the customer. It's already on. And we found that the companies that hire that way, meaning hire people not really even who have customer service experience, but love to be of service by little hacks, like asking questions in the interview process, such as, "Tell me about a time when you helped somebody out when you didn't have to." That person who can answer that well loves to be of service. So, it's easy to train them into the role and easy for them to deliver great experiences versus thinking you need to train somebody or that they have to have, quote-unquote, "customer service experience" to be really good at it. So, of course, you have a whole book on this. You have a whole institute that helps people learn these things. But could you give our audience just a very brief couple of points of what are some of the critical things that companies need to think about in terms of their culture and how to create that culture of service? Sure. It really comes down the engine to it is recruiting and training. It's because once somebody is in the organization, they can either be like a godsend or they could commit gross negligence and bring down the company. That's how important the process is around recruiting and training. I really think they're the engine of the organization. So, how you figure out who those people are, what questions you're going to ask. Are the companies' values already articulated and do you have an interview process that's able to use questions like that to ascertain to somebody actually love to be of service? And then once they're in there, even all the way through, I found it. It's really taken me about 10 years to realize what culture is all about. And that's two things. One is what we've discussed so far. It's really defined by the bookmarks of it, which are who you let in and who you kick out. That's the biggest control levers we have. Because like I said, once they're in there, you can't really micromanage everybody. So it's really important that getting clear of who you bring and who you kick out. But within there, the kind of currency of culture I found is really, really, really simple. Which is agreements. And if you think about it, you can even think about yourself just in your head right now. Anytime you've probably been disappointed at work, I would bet it has to do with one of two things. One is somebody said they were going to do something and they didn't do it. Or you expected them to. They didn't necessarily say it, but you expected them to do something and they didn't do that. And then there's a breakdown and trust. And so people talk a lot about trust, but what trust comes down to is are the agreements articulated clearly? Because it's really hard to hold people accountable to something that they didn't explicitly agree to. Right. And are those agreements upheld? So if you have very clear agreements, and let me just say the opposite of it, which has made all of us into liars, is I'm sure you've clicked a button that says I've read and agreed to the terms and conditions. So many times. Right. And that's not really explicit agreement. You don't know what you're signing up for. So the opposite of that is when I went skydiving and I looked into a camera and had to say, my name is Robert Richmond, I absolve the company of any liability. I know I can die. So nobody saw that and thought he'd just only click the terms and conditions. So every agreement from a job description to upholding the values to just agreeing to a task. If it's not explicit and very clear, then it's really hard to have a very cohesive culture. So the companies that really pay attention to agreements are the ones that have strong cultures. It makes a ton of sense when you lay it out that way, but it seems like something that can be so mystifying to people. What is the culture about? And it's not beanbag chairs and ping pong tables. It's about people. Exactly. Exactly. So speaking of the way that culture interplays with the tools that we use, obviously this technology conference, we're talking a lot about, yeah, I right. Oh, you know, those kind of things. I would love to get your perspective and artificial intelligence and how companies might be thinking about it and what some of the benefits of it might be, particularly because you are so focused on that human side. And of course, we all know that there's sort of an uneasy tension right now between what is AI going to be? How do we keep the human side of things in it? Yeah. I like to think of this first and foremost conceptually through metaphor. And we use metaphors all the time. In corporate culture, there's a lot of sports metaphors, team, performance, coaching, even money itself. The way we only understand it is through metaphor. If you think about every single term, it has to do with water. There's pool assets, freeze assets, cash flow, river banks, rainmaker salespeople. Every single word about money is really it has to do with water. And so the metaphor for lack of a better one at this point, at least, is I call it the Sesame Street metaphor because with Sesame Street, what happened was they tested out first a show with all kids and the kids thought it was okay. Then they mixed the puppets with the kids and they were just entranced. And I think that's. the metaphor for the level of engagement that can happen when humans and AI work together rather than thinking, "Okay, let's just have only entirely human focus or only entirely AI focus." How can we really maximize the creativity of individuals, but in a way, outsource the mundane to the AI? I think that's going to be the most powerful companies. So what kinds of AI capabilities are you finding really interesting? What things have you heard about or seen that you think might really help companies? Do that hybrid model of bringing the AI together with human? Yeah. On a basic level, it's the really mundane tasks, like resetting passwords, like looking up shipping labels and finding out when something is going to come or rerouting that or even doing a product exchange. These types of things that the customer service agent has to essentially be a robot doing those things. So those things I see becoming automated. And even further than that, what I'm seeing is the ability to test for not only sentiment of the customer being able to pinpoint that, but also for compliance sake. So systems such as there's one called balto.ai, for example, is able to listen on the dialer and check off automatically that the agent is going through the compliance features of this. These types of things that are really mundane, but also can be really important. Something like compliance is usually important. These kind of things can be better with AI to create a better experience. Especially forward the agent because I think this is the other thing about culture. It all comes down to energy. And I say in my book, the culture blueprint that everybody's a culture expert because you know walking into the party, either, wow, this is feeling really great or oh my gosh, I need to pretend I'm sick and get out of here because you can feel the energy of a room of an office of anywhere. And so the more we can do for people to really lift their energy up, that's going to translate over to customers. That is a great way to put it and great way to think about it. Have you experimented with AI much yourself? I'm seeing myself right now as a counterbalance to that world of let's not forget the human because a lot of this comes down to the, what I call the basics of things that aren't going to go away in terms of human interaction or in terms of just systems that we use like NPS to determine if we're really succeeding. And so I've intentionally taken a step back from all the AI also because I think that it's really developing. But at the same time, if I was running a call center right now, if I was doing a lot of customer service, I would completely roll my hands up personally and do that because it's just so exciting. Everything that's going on right. Yeah, it is. And hearing a lot of buzz about that this week is we're talking to customers and they're so excited about some of the new things that are coming forward. Do you have any advice for companies that are starting to plan their rollout or implementation of AI? What kinds of things should they be thinking about? Both from the perspective of maintaining their internal culture as well as from perspective of keeping that human customers. Yeah, so the interesting part of human nature is that even if it's something we like, if we're not part of co-creating it, we'll tend to reject it. This happened at a company I was working at where the company, the programmers, wanted the lean startup development process, but they weren't consulted about how to do it. When it was pushed out, it was rejected because of the way that it was done. To use a software analogy, there's the software itself, but there's the installer that needs to be programmed to install software. I think that has to do with culture as well. There are various processes I use one called open space technology that crowdsource his ideas and says, "Okay, the leader says, rather than this is exactly what we're going to do, says the aim. I want to use AI to accomplish this in this. How are we going to do it?" They take all the advice and opinions in, and then the leader can decide. The brilliance of this is that people, even if their ideas aren't chosen, they want to know they were heard. I can say, "Okay, at least they heard me, they understand me. I even have a difference opinion, but I'm going to go with this because I respect them now. I respect that my viewpoint was not only heard, but maybe even responded to. Here's why we can't do this. Here's why we don't want to. Here's who we're going to go in a different direction." It's absolutely key to co-create front line all the way up as to how these rollouts are happening before they even have. That's both so that people don't want to reject the change because people are just naturally versed to change. Because they value it more. If I remember, there's a quote in your book, something you're going to do, people really want to support and keep the things that they work for. The other thing about rolling something out, especially in any type of beta situation, is when people roll out something, the employees all think it's going to be permanent. Because they think it's going to be permanent, they'll sometimes drag their feet because they believe staunchly that this is not good for the company. If instead, we create it as an experiment and say, "Look, we don't know if Blank will work, whether it be AI or an integration or a Zen-desk integration or something," but saying, "We are going to test it out, maybe on this division of customers or product line and for this amount of time, people start to relax because they say, 'Oh, we're going to test it.'" That language is key, not even a pilot, but a test or a beta, to say, "We don't know if this will work." The other key with this too is saying, "We're only going to have the opinions heard of people who help and participate. If you're not willing to help, we're not willing to hear your opinion because it's just an opinion. If you work on this with us, we will hear your opinion and then people's nervous system is just relaxed. Then they're able to go along with the change." That makes a ton of sense. Do you have any other recommendations around managing change? Obviously, the last several years have forced a lot of companies to talk about, "Can we be agile? How can we grow? How can we bring people along?" What are some of the big learnings that you've seen about that? Because we know AI is going to keep changing the workforce for probably years to come. Yeah. The creator of OpenSpace Harrison Owen had a really interesting quote. He said that all change is grieving. He didn't even say all negative change. All change is grieving. What does that mean? The grieving process, as you probably know, can be very emotional. It can involve denial, anger, sadness, all these types of things. The most I learned about grieving actually came from my father because his mother died when he was not. He said, "Nobody knew how to handle it, but his rabbi came to him and said, 'Just tell me about your mother and let me listen.' Then he just got to talk and talk, and that ended up being most cathartic healing process. I think for any type of change, as somebody's going through, people need space to safely talk about it and express their emotions and say, "Do they like this? Do they not? What are they going to miss about the old thing? What are they scared about the new thing?" This attention to actually thinking about it like a grieving process and letting people grieve. It goes slower at first, but then it goes faster versus people dragging their feet all the way and you don't even know why. It sounds like a couple of the key things are make sure people feel like they're part of the process. They get help created. If it's something that's going to be a dramatic change, bring it as a test or a beta, so it doesn't feel like a permanent thing, and then create that space for people to feel heard. You have people feeling heard. How do you think that AI might help with that? Obviously hearing our customers, hearing their feedback, hearing what they need is a critical thing. But there's space for the technology to help support that. I think that's a brilliant part of it. In terms of sentiment analysis, there's also seen one of the most prominent issues that have to be resolved that can get up there more quickly. Something I mentioned on stage at the Zendes conference, which I think everybody has access to the recordings on your site as well. Yeah, we'll be sure to put those in the show in the next video. The key note, the most amazing fact that the finance department figured out at Zappos was that the lifetime customer value is on average $200. But if you cross-reference that data with people who called in had a problem and got it resolved, that lifetime value went up as much as six times, two to six times higher value of a customer who had a negative experience, but got it resolved. That's why I was telling the people in the audience that start thinking about yourself more from this type of data that you are actually helping the company as a profit center. I say this to the leaders in the CEOs, too, because oftentimes they think of customer service as a big cost center. Oh, man, we have to spend all this money on this and people and that when the data really shows that if you're doing it right, it actually increases revenue. That makes a ton of sense to me because it seems like you're most vocal detractors, if people that are going to complain the most are doing so because they're right, because they have high expectations of you. So if you can pivot that from a negative interaction to a positive one, you can build somebody that's a brand advocate. We got a positive view on you. Like you were just saying, technology may be something that helps us recognize those opportunities to change those things. And really, at that point, we bring a human to shift conversation. Yeah, I think companies will know they made that real switch when they're actually welcoming the complaints and not thinking of it as a nuisance. And oh, man, how do we deal with this? Like how do we see these complaints as gifts, their feedback? And as I showed on stage, the worst thing that can happen is they leave and they say nothing, absolutely nothing because they just don't want to have anything to do with you. If they took the time to call in to complain to say something's wrong, like you said, it means they care. Absolutely. So one of the things that we've been talking about a lot this week is this idea that the customer is always human. We need to remember that. Does that resonate with you at all? Yeah, I love that phrase because at the end of the day, it's so obvious, but nobody really says that. I was hearing V.
and I just went downstairs and they've got a bar that's run by robots. Just completely run by robots. That's about the tipsy robot. Yeah, yeah. And you know, so obvious that the robots can serve, but they can't drink them. I love the tag phrase that the customer is always human because it reminds me about a practice that Amazon does, which is at their meetings, they include a empty chair that represents the customer point of view. So they can always be thinking, right? Thinking, okay, wait, what's the customer point of view on that? And that's just one idea of a ritual or practice to do around it. But I think that keeping that kind of refrain, that kind of key phrase in mind of as we're doing this, okay, remember this is somebody human. How is this going to affect them? So I love the phrase. I do too. I think it is a great way to keep us focused on the human side of things as we're thinking about all of the efficiencies that this technology can drive and all the cool things it can do. You have to remember that it's still people on the other end of the screen. Okay. You've worked with companies that work in customer service for a long time. I'm sure you've seen the field of all quite a bit. Where do you see it going? What do you think the future of customer service looks like? Yeah, it's really getting very interesting with the voice, the AI voices, because they're getting better and to the point where they can really adjust on the fly what they're saying to people. At this point though, it's interesting because some of the solutions I won't name them, it's so obvious that it's an AI. And so I don't think it's quite there yet, but it's heading in that direction where in soon enough time we won't be able to tell the difference. Right now you can tell the difference. But I think we're going to get to a point where we're going to hear some voice agents where you won't be able to tell the difference. But I think the human factor comes in because the AI will be able to tell, uh oh, this is going off the rails in a way that are usual scripts and flow charts don't really work for. How do we seamlessly get an agent in here? And the AI would say, I need somebody to help me with this. Can you hold on for one second and hold on for 10 seconds and then the human comes on and it won't even feel like a big transition because the AI sounds human and then you've got an actual human that of course sounds human. So I think this type of interplay we're going to see more and more. All right. One of our favorite questions to always ask on the podcast is something that celebrates positive customer service experiences. A lot of people are from the negative ones, but we want to make sure they're always emphasizing all of the great things that happen every day. So easy to brush the good ones under the rug and be like, oh, I don't remember that. I just remember the time that it was really terrible. Right. Do you have an example from your life of a time that you were in the customer position and received great service from another brand or company? Yeah. I mean, it's even happened here at the hotel. They completely organized the bathroom area in a way that they just didn't even really have to. Interesting. That's where I think that the creativity comes in from the human factor of how do we take this above and beyond. It happened to be yesterday as well. I went to eat at the Mediterranean place downstairs and I'm eating my meal and then they give me a free extra portion. I said, why? They said the one the kabab we gave you was broken. And they didn't wait for me to complain. They just anticipated that this could be an issue. And it personally wasn't for me, but I know that if I was sitting there thinking that and now they just gave me a new one without me even asking for it, that's that need anticipation that I think is the human edge that's still out there. Do you think that AI will help us with that anticipation too and help identify those moments? They're like, oh, hey, there might be something off here. You can just jump in and surprise and delay it a little bit. Yeah, it'll start to, especially when there's a certain issue and with the AI, you can term. This is the appropriate response. This is when it should be a discount. This is when we should return this for free. And I'm a big proponent of what I call don't try to protect yourself from the 2% from the 98%. And that's what we did at Zappos is literally with the exchange. The shoes are sent first, assuming that you're going to send them back as opposed to waiting. A terrible customer experience I had was where I didn't get something and they said, okay, we'll need to do an investigation. I'm like investigation. How is this my problem? Like why don't you send me a new one and then do your investigation? So yeah, I think that as trends come more and more, especially for a company doing it because it's going to be very specific to that company. What are the resolutions? What are the tools? What are the wow tools that we can use to make sure that this doesn't become a detractor and it becomes a promoter? That is critical. Can you tell me a little bit more about the 98% 2% rule and dig into that a little bit? Yeah, so the idea is a lot of companies will have policies that 2% of people will abuse. But 98% won't. That was at Zappos this idea of you have a year long to return the shoes and even sometimes when it's used. But the thing is, it's really believing in human nature that most humans are good people. And that even if the 2% continuously abuses it, the system will show that they're invited to shop elsewhere. But it's instead thought who can really benefit from a lot of these policies and rather than being in total protection mode for that 2% that's going to violate it. Got it. That makes a ton of sense. Robert, I've loved this conversation. This has been so cool and I would love to hear a little bit about what is coming for you next. You've got your great book. You've got your great institute. Here we've got another book in the works. Yeah, so I'm developing something called the cultural OS, the cultural operating system that goes deeper than the culture blueprint that has all kinds of tools and checklists and processes that I'm going to be rolling out. And also a book that I'm really excited about. It's called The 48-Hour Day. And what I realize is that myself and other people, I don't know if you've experienced this, but sometimes I get to the end of the day and it's like, I feel like I don't deserve the rest at the end of the day. I almost feel guilty watching a Netflix show because I think, okay, I didn't do enough. I don't even deserve to relax. I didn't earn my free time. And then sometimes it happens where we're thinking about the free time during work and then we get the free time and then we're thinking all about the work. We're feeling guilty that you're not still doing more of the work. The concept is really simple and any listener can actually experiment with this. Even though I'm creating tools for it, the concept is so simple. The idea is you commit to something that you think would take two to three weeks and you spend 48 hours on it in a limited window. And you can sleep or not sleep. The idea is you don't do any other projects because all the lost energy comes from multitasking. And so I did this recently with one of my books with the audio book version of, I said, you know what? I bet if I really set this deadline, I can record it and upload it and have it up on Amazon 48 hours. Wow. And I did just by doing that and the feeling of accomplishment I had on that, I earned my rest, right? And so I just love this. I'm looking to work with other teams on this of how teams can do it as well. How can we focus for 48 hours and get more done than we usually would have done three weeks? That sounds really exciting. I can't wait to read that book. It's been such a pleasure speaking with you. I really enjoy your work and appreciate it and that's a deep troubles help. Thank you. Thanks for having me. Well, that does it for our Relate Recap. I hope you enjoyed it. Be sure to check out the show notes to access the recordings of all of the relate sessions and more. Be sure to join us next time for an interview with Guillermo Colberg, head of CX and customer care for XP, one of Latin America's largest investment firms. Until then, I'm Nicole Zander's present-esque, the intelligent heart of customer service.
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