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Joseph's Blog

{Infographic} High Trust = Happy Employees, Customers, Shareholders, & Leaders


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

High Trust = Happy Employees = Happy Customers = Happy Shareholders = Happy Leaders

You might say I am on a “trust” kick.

In last week’s blog, I highlighted a US decline in social trust (a precipitous drop of 46% points from 1964 to 2016). I also opined on the critical role of trust in strengthening the social contract between businesses and customers. Finally, I asserted that trust begets trust. As such, I suggested business leaders should take the first step by trusting customers out of respect and gratitude for them.

Value of Trust

So this week, I thought I’d look at the “value of trust,” first from the perspective of shareholder returns and then from the vantage point of benefits to the entire business ecosystem. In his seminal work, “The Speed of Trust,” Stephen M. R. Covey cites a study conducted by Watson Wyatt that showed, “Total return to shareholders in high-trust organizations is almost three times higher than the return in low-trust organizations.” In other words, when employees feel they can trust their leaders, investors tend to reap greater returns.

In addition to investor returns, high trust organizations are good for leaders, team members, and even customers. I depict this relationship in the formula:

High TRUST = Happy Employees = Happy Customers =

Happy Shareholders = Happy Leaders

Research Support

In support of my formula, Neil Davey, the managing editor of recently cited David Ulrich’s research on the value chain of trusting and engaging employees. David Ulrich is a professor of business at the Ross School of Business at Michigan. Neil cites David’s research noting that it demonstrates, “For every 10% increase in employee engagement levels, a company’s customer service levels go up by 5%, and profits by 2%.”

By contrast, employee distrust, disengagement, and neglect for development create the environment for most customer complaints. Neil notes, “A recent survey of 3,000 consumers by the Institute of Customer Service (ICS) reveals that staff attitude and staff incompetence are rated the ‘most annoying or frustrating’ service problem, while ‘people-related issues’ account for a whopping 62% of all complaints.”

I have often said, if something doesn’t live inside an organization, it won’t be perceived outside the organization.

Key Leadership Behaviors

What do great leaders do to build the trust of those they serve? While the list is long, I will focus this blog on three key behaviors:

  1. Share a Vision
  2. Make Promises in Keeping with that Vision
  3. Honor Your Promises

Share a Vision

It’s hard to trust a captain without a compass or an Uber driver who is unwilling to use a map or navigation guidance. By taking the time to create and articulate your vision you offer your  people navigational bearings or a sense of “true north.” The delineation of vision allows them to choose if they want to join you on the journey.

In the context of working with leaders at Mercedes-Benz and writing my book Driven to Delight – Delivering World Class Experience the Mercedes-Benz Way, I witnessed first-hand the trust-building power of crafting a vision for the desired future state. In the case of Mercedes-Benz leadership, that vision was shared both through words and in the form of a visual roadmap.

Make Promises in Keeping with that Vision

Once people know where you want to take your organization, you must commit to the steps needed to help them get there. While consulting at Mercedes-Benz, I watched this willingness to verbally commit to a course of action build incredible trust with employees and dealer partners. Then CEO, Steve Cannon, promised the following through a video known as The Standard:

“<This year> will see the introduction of the most comprehensive pledge to an extraordinary customer experience in the history of Mercedes-Benz. Every department will be mobilizedEvery touchpoint in the brand will be examined and refinedEvery employee in every dealership will be trained and equippedWe will begin immediately and will not rest until we are viewed as the global benchmark…”

Honor Your Promises

Nothing erodes trust more quickly than false promises. It may be better to commit to nothing than to commit and fail to act in accord with one’s commitments. In the case of Mercedes-Benz, despite many possible distractions, leaders stayed their course and provided touchpoint mapping, toolkits to activate the maps, and training for every corporate and dealership employee.

Trust, Engagement, and You

What are the trust and engagement levels of your workforce? I suspect those trust levels are impacting customer engagement and your ROI. Moreover, I believe you can drive trust in your organization through vision creation, commitments, and actions in support of those commitmentsWhat do you think?


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

{Infographic} Winning Customer Experiences – Simple Matter of Trust

Winning Customer Experience – Simple Matters of Trust

Customer Experience and Trust…hmmm.

Here’s three quick questions to engage your brain.

1) How would you answer the following?  “Most people can be trusted” – True or False?

2) What percentage of Americans answered “True” to that question in 1964? and,

3) What percentage of Americans answered “True” to the same question in 2016?

If I were a betting man, I would guess you answered “No” to question 1, underestimated on question 2, and may have been close on question 3.

The Findings

So the answers are…. drumroll please… In 1964 77% of respondents said “most people can be trusted”  but only 31% viewed most others as worthy of trust in 2016 (thus causing my negativistic prediction about you today).

So where did those 46% points worth of trust go in that 52 year span?

My uneducated guesses include such things as the highly vitriolic and alarmist tone of political discourse, high profile cases of corporate greed, a 24 hour news cycle trolling for stories of human depravity, a level of social media viciousness fueled by people relishing in the anonymity and reach of their online posts, etc.  But I will let social scientists take a scholarly approach to understanding our ‘trust gap.”

Trust and Customer Experience

For me, as a customer experience consultant, “low trust” has huge business importance. The 2016 data emerging from research conducted by Stanford Law School has led PBS to opine that the new US motto should be “In Nothing We Trust.” This pervasive cynicism is not limited by how we view one another but how we view most institutions including government and business.

So how do businesses thrive when they are likely populated by owners, employees, and customer who all share a common and heightened level of distrust?  More importantly how do you differentiate yourself as a trustworthy brand?

Given the enormity of this topic, I will try to digest it over multiple posts.  For this week’s installment, I will focus on the importance of EXTENDING TRUST IN LOW TRUST TIMES.

Trust Extending Customer Experience Example from Zappos

I remember working with Tony Hsieh, the CEO of Zappos, as he defined a policy that allowed his contact center staff (referred to as the CLT- customer loyalty team) to credit a customer’s account with a return if a customer notified the CLT that they were “going to be returning” items.  In essence, a call to the contact center might go as follows:

Customer:  “I have ten pairs of shoes I am going to be sending back.”

Zappos CLT: “Great I will remove those charges from your credit card.”

Customer:  “Wait, I don’t trust myself to do that immediately.”

Zappos CLT:  “That’s ok,  I trust you and I have off backed the charge.”

Customer: “WOW, are you real?”

That type of unconventional policy essentially extends trust “even before the customer” thinks it is warranted.  (BTW, if the shoes never make it back they can always re-run the charge.)

Customer Views of Brand Trust

From a customer’s perspective it is a rare brand that extends trust.  Given laws of reciprocity, people tend to return that which they are given — thus, unexpected trust results in the reciprocal action of finding a brand to be trustworthy.

There are at least 3 key elements to extending trust.

1) Contrary to the emerging trend, you have to fundamentally believe that “most people are trustworthy”; personally, I am not sure if I can operate any social contract if that is not at the center of my belief system

2) You have to authentically extend trust whenever possible, and

3) You need to know reasonable limits of trust and how to manage those cases where your trust is violated.

Sidestepping the Cynics

I know the cynics. They talk about how “customers will rob you out of business” or “if you give an inch an employee or customer will take a mile.”  They will cite examples like the recent story in the Washington Post where an umbrella-sharing start-up in a very “communal” culture like China struggled from overestimating the trustworthiness of people. According to the article,

“For a deposit of about $2.79, users could check out an umbrella via app. They would then pay about $.75 for every half-hour of use and check them back in when done. Users could find the umbrellas in stands at subway and bus stations, they could leave them wherever. Once checked out, a user would receive a code to unlock the lock built into the handle….<BUT> not everything that can be shared should be shared <as> nearly all of the 300,000 umbrellas have gone missing.”

I counter with examples of businesses that adhere to the three tenets I’ve listed above and how those businesses extend trust to customers as a part of the respect they have for them.  That respect and trust are foundational to all relationships and should be assumed until the other person acts to erode it.

Tracking Reasons to Trust People

Call me naïve, but I would rather read less about humans being untrustworthy and read more about #dressmatchmaker – the hashtag used by a grassroots movement of women offering to let other women “borrow” their wedding dresses in the wake of dress manufacturer Alfred Angelo’s sudden bankruptcy.

Here are excerpts from a few tweets that continue to give me cause to trust the amazing goodness of people….

#dressmatchmaker I just got married in May and am willing to give my dress to a scrambling Bride in need!

#dressmatchmaker I heard the news! I have a size 18/20 dress that I would happily part with to a bride in distress!


Anyone willing to donate their wedding dress to a bride in a bind? I’m going to offer mine after our wedding in 2 weeks. #dressmatchmaker

I am looking to share more on “trust” in future blog installments and you can TRUST that!


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

{Infographic} CAIO or No CAIO


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli



CAIO or NO CAIO: Customer Experience Depends Upon Structuring People to Manage Information

I first heard about “it” in a Harvard Business article in 2016 and subsequently have been asked about “it” by clients and colleagues alike. “It” is yet another entrant into the C-suite. “It“ (actually a she or he) is a Chief AI Officer (CAIO). That’s right a human Chief Artifical Intelligence Officer (not a machine or robot occupying an executive office).

The Transformational Power of AI

In his thought-provoking HBR article, Andrew Ng suggested artificial intelligence will produce social transformation on par with electricity from 100 years ago and the internet from approximately 20 years back. Andrew, the chief scientist at Chinese internet behemoth Baidu Inc., also linked the emergence of the internet with the evolution of the essential corporate position of Chief Information Officer (CIO). All of which set the frame for Andrew’s central argument:

“To the majority of companies that have data but lack deep AI knowledge, I recommend hiring a chief AI officer or a VP of AI. (Some chief data officers and forward-thinking CIOs are effectively taking on this role.) The benefit of a chief AI officer is having someone who can make sure AI gets applied across silos. Most companies have naturally developed siloed functions in order to specialize and become more efficient.”

We’ve Been Here Before

It is this “same logic” that drew my support for the chief customer officer (CCO) concept around 2006. For historical reference, the first customer officer, Jack Chambers, was appointed in 1999 at Texas New Mexico Power but the role didn’t gain significant visibility for many of us until at least 2003, when a small but impressive group of CCO’s began to surface (e.g. Jeff Lewis at and Marissa Peterson at Sun Microsystems). In the early days of the CCO movement, the case was being made (and continues to be made today) that Chief Customer Officers are needed to “break down silos” and “focus on enterprise-wide strategy placing the customer at the center of all corporate decision-making.”

Decentralized and Nimble

Despite the general attractiveness of placing senior level leaders at the helm of enterprise-wide efforts, I’ve found myself resistant to the slowly emerging Chief Artificial Intelligence Officer (CAIO) movement. It wasn’t until I read 2017 HBR article from Kristian Hammond that my unsettled feeling was given voice. Here is Kristian’s key thesis posited in his article so aptly titled,  Please Don’t Hire a Chief Artificial Intelligence Officer:

It’s not that I doubt AI’s usefulness. I have spent my entire professional life working in the field. Far from being a skeptic, I am a rabid true believer. However, I also believe that the effective deployment of AI in the enterprise requires a focus on achieving business goals. Rushing towards an ‘AI strategy’” and hiring someone with technical skills in AI to lead the charge might seem in tune with the current trends, but it ignores the reality that innovation initiatives only succeed when there is a solid understanding of actual business problems and goals. For AI to work in the enterprise, the goals of the enterprise must be the driving force.”

From my vantage point, AI is a monstrously powerful tool baked into the fiber of all aspects of data-savvy companies. It is best managed by agile teams that leverage Artificial Intelligence as a solutions and innovation tool. Neil Jacobstein the head of artificial intelligence and robotics at Singularity University went further by telling the Wall Street Journal  that:

“It’s very important to match the speed of the technology with the nimbleness of the teams. And having a centralized AI guru at the top, where everybody has to ask questions of that person, is unlikely to be as fast and effective as having a decentralized organization with powerful teams. Centralizing AI across an enterprise might prove unwieldy compared to having small teams.

AI Itself Can’t Solve This

Invariably large, data-rich organizations will wrestle with the question “to add or not to add” a CAIO. Until I hear a more convincing case for this new position in the C-Suite I doubt I will be recommending the change.

The big takeaway for all of us is an appreciation of the transformational power and potential of big data, machine learning, and artificial intelligence. Also, it is the awareness that machines won’t likely solve issues like how to structure our teams and leaders to use that very data as we pursue key business objectives. Some things can only be left to the intuition and modifications of people!


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

{Infographic} Customer Value – Expanding across the 12 Standard Forms of Value















































Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

Customer Value: Expanding Across the 12 Standard Forms of Value

Great leaders often ask me to help them create “customer value”, while others ask me to help them create “profit.” For me, the only way to generate sustainable profit is by developing a core competency for customer value creation. Chasing profits is a tiring and stressful endeavor – creating value is an innovative and energizing pursuit.

You have a customer solution, now what?

Assuming you know your core customer segments, listen well to the needs of people in those segments, and think about ways to easily meet their needs in ways that resonate with their values and lifestyle – you are likely well on the way to being a “customer value” based business. But how do you maximize the platforms through which you deliver that value? 

To answer that question, Josh Kaufman offers a valuable tool!

12 Standard Forms of Value

Josh has one of those brains that I envy. He is a voracious reader and an entrepreneur who synthesizes wide swaths of information into accessible and practical models and tools. In his book, The Personal MBA, Josh outlines 12 standard forms of value delivery:

  1. Product
  2. Service
  3. Shared Resource
  4. Subscription
  5. Resale
  6. Lease
  7. Agency
  8. Audience Aggregation
  9. Loan
  10. Option
  11. Insurance
  12. Capital

Most of the labels provided by Josh are fairly self-explanatory (e.g. product, service, loan, or insurance) but other value platforms require some unpacking. Fortunately, Josh generously offers detailed descriptions both in his book and on his website. For example, he notes a shared resource is “a durable asset that you create once, and then charge the customers for using it many times. Classic examples of this form of value are gyms, museums or amusement parks.”

Even before I ran across Josh’s comprehensive delineation, I’d been encouraging my clients to maximize value delivery by considering multiple platforms. Let me give you an example of a company that is doing that very thing. They are called Omni.

Omni Value Platforms

Omni’s core customer has too many items in their living area and is ostensibly in need of  “leasing” storage space. Like several other players in the storage industry, Omni has created value through “on-demand” storage – meaning that you don’t encounter the pain points of leasing a storage space under a long-term agreement or feel constrained to a certain size storage unit as your needs expand or contract.

In addition to the fluidity of “on-demand” storage, Omni delivers additional “service”, and  “agency” value. In an article for Techcrunch, Ryan Lawler shares some of Omni’s service value components:

But where Omni seeks to differentiate from other storage startups is in providing item-level categorization and access to its users’ stuff. When you store your stuff with Omni, it doesn’t just sit in a box or crate collecting dust in a warehouse somewhere. The company goes through the process of photographing, identifying, categorizing and adding each item to an inventory that can be managed in a mobile app. Users can choose to take items out of storage at any time, so long as they give the company at least two hours notice.

From my vantage point, photographing, identifying, categorizing, building an inventory,  housing that inventory in the cloud, and making the items accessible through a customer’s app portal represents “service based” value enhancements provided by Omni. The profits that Omni derives from those value offerings come from the charges involved in storing each individual item. In fact Omni’s VP of Product and Growth, Ryan Delk is quoted in the Techcrunch article as saying, “We positioned ourselves as a storage company knowing that was a Trojan horse…Omni has itemized more than 100,000 goods in the 18 months since launch, and <we’ve accomplished this because> everything happens on the item level.”

Omni’s service and lease value platforms are priced for small items at 50 cents per item per month and large items at 3 dollars per item per month. Omni adds more service value by picking up your items for storage at no cost and delivering requested items at a cost linked to the urgency of that delivery. For example, if you need your large step-ladder delivered to you tomorrow, they will do that for a cost of $3. If you need it within 2 hours that same delivery will cost you $20.


One final twist in the evolving Omni value model is “agency.” Josh Kaufman describes agency “as marketing and selling an asset you don’t own. By establishing a new relationship between a source and a buyer, you earn a commission. The benefit for sellers is generating sales that without an agency might not happen. Buyers benefit by finding assets to buy that the agent, whom they trust, filters for them.”

Omni is testing an app feature that lets a customer share part or all of their stored items with friends and family members – such that the customer’s network can request delivery of stored items with the permission of the owner. 

As Techcrunch author Ryan Lawler astutely predicts, some people are already doing this, by hacking the system with peer-to-peer Venmo or PayPal payments when they borrow an item from a friend or neighbor. And you can imagine how the company would want to capture some of the commerce it already sees on its platform.”

How are you taking the customer value you deliver and expanding it to “capture some of the commerce” across more of the 12 standard forms of value?


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

{Infographic} Customer Experience and Value Add



Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli

Customer Experience and Value Add: Make it Personal, Emotional, and Sensory

Being raised in an emotionally expressive Italian family, it’s no wonder that I’ve been attracted to the emotional side of business and the importance of “emotional value” in customer experience creation.

emotional value

Over the years, I’ve gravitated toward thought leaders who’ve echo my belief that “all business is personal” and to my view that “behind every purported rational decision lurks a powerful emotional driver.”

Love and Profits

Dating back to 1991, I was taken by the writings of James Autry as he broke with traditional boss/employee power hierarchies and encouraged a more personal/emotional approach to leading people. Writing in his book, Love and Profits, James noted, “Good management is largely a matter of love. Or if you’re uncomfortable with that word, call it caring, because proper management involves caring for people not manipulating them….Management is a sacred trust in which the well-being of other people is put in your care during most of their waking hours…. So management is a matter of being ‘in relationship.’” From James Autry’s and my vantage point, leading through “love” and “relationship “ are authentic emotional drivers for employee engagement.

Predictably Irrational

Behavioral economist, Dan Ariely’s work on emotional decision-making has also been ground-breaking and inspirational; particularly, when it comes to consumer behavior. In this blog post from 2008, Dan noted:

We used to think about decisions as cold calculated, detached, computations that examine the costs and benefits, but recently we have gained a higher appreciation for the role of emotions in our decisions and for the fundamental ways in which they change us…. Emotions are an integral part of who we are, a part that represents our evolutionary history, a part that is a basic and necessary component of our behavior.”

Dan’s Nobel Prize winning research and books like Predictably Irrational continue to highlight the effects of human expectations, arousal, and “high-emotion” situations on decision-making, purchase behavior, and loyalty.

Emotional Value Across the Journey

Thought leaders and researchers like James and Dan champion the importance of incorporating emotional value into every decision we make when serving others (team members, direct reports, suppliers, shareholders, and customers). Our value and the value of our goods and services is often fully realized when people, processes, and technology align to make our deliverables personal, emotional and sensory.  

To demonstrate the importance of the sensory connection, for example, one need look no further than the evolution of virtual reality. From my first exposure to early Oculus Rift innovations to more advanced deployments leveraged by my clients and others, I’m convinced that virtual reality is emotional reality.

Evolving VR

If virtual technology to date isn’t immersive and intensely emotional enough, new breakthroughs are taking this brain-absorbing tool to a new level. Writing in Venture Beat, Dean Takahashi previews a new semiconductor being developed by Tegway called ThermoReal. According to Dean:

“ThermoReal is a thermoelectric device that can generate heat and cold upon demand and translate that feeling into your hands as you hold touch controls in VR. It is a new kind of human-machine interface….. I put on a VR headset and held the ThermoReal controller in my hand. As I touched something flaming, I felt actual heat. And when I touched something cold, I felt the coldness for real. And to make me feel pain, the ThermoReal device generated both heat and cold at the same time. It was an electrifying experience.”

Whether it is the heat, cold, or pain of ThermoReal, or the surprise and delight customers feel when they are remembered from visit to visit, brands that deliver emotional value are, in turn, emotionally valued by their customers. Those who simply deliver practical value are at the mercy of those who can deliver that same value, with a touch of the personal, emotional, and sensory.

How About You?

What are you doing to drive emotional value? How are you making it personal, emotional, and sensory particularly at the “moments-that-matter” for those you serve?


Joseph A. Michelli, Ph.D. is a professional speaker and chief experience officer at The Michelli Experience. A New York Times #1 bestselling author, Dr. Michelli and his team consult with some of the world’s best customer experience companies. Follow on Twitter: @josephmichelli