Leading Innovation To Respond to Customers’ Changing Needs

Chris Curran: Growth Igniters Radio, Episode 60: Leading Innovation to Respond to Customers’ Changing Needs − A Case Study.

This episode is brought to you by Business Advancement Incorporated, enabling successful leaders and companies to accelerate to their next level of growth − on the web at www.businessadvance.com. And now, here’s Pam and Scott.

Pam Harper: Thanks, Chris. I’m Pam Harper, founding partner and CEO of Business Advancement Incorporated, and with me is my business partner and husband, Scott Harper. Hi, Scott.

Scott Harper: Hi, Pam. It’s another day in paradise, and I have the pleasure of joining you for Growth Igniters Radio. If this is your first time listening, our purpose is to spark new insights, inspiration and immediately useful ideas for leaders to take themselves and their companies to their next level of success. So Pam, what are we talking about today?

Pam Harper: A case of study of what it takes to lead innovation to respond to customers’ changing needs. Now, it’s not always easy to pick up on what is most important to customers as the business environment evolves, which leaves too many companies scrambling to introduce new products and services that are either too late to market or are not really a fit with needs. When you can foster a culture that truly values innovating in a way that is most relevant to customers’ new needs, it’s a win for everyone.

Our guest today exemplifies this. In episode 39, we interviewed Julie Sue Auslander, President and Chief Cultural Officer of the award-winning company cSubs, about her commitment to consciously shaping her organization’s culture as the foundation for growth. Now, cSubs is a highly successful middle-market, woman-owned business that manages subscription programs for leading corporate and professional subscribers. It’s one of the few companies that Inc. Magazine has named among its 5000 Fastest Growing Companies for more than 6 years in a row, beginning in 2008.

Over the years, both cSubs and Julie have received many other honors, including being named to the Women’s Enterprise list of top business enterprises in the U.S. and receiving the 2015 ACG New Jersey Corporate Growth Award, which is where I met her. In addition to leading cSubs, Julie sits on the advisory board of the Center for Women and Enterprise and the Leadership Forum for the Women’s Business Enterprise National Council, which is an organization of more than 12,000 woman-owned companies. You can find out more by scrolling down to Julie’s biography on the Episode 60 page of Growthignitersradio.com.

Julie, welcome back to Growth Igniters Radio.

Julie Auslander: Thank you. The pleasure is mine.

Pam Harper: Let’s get to this conversation, because you’ve done some amazing things with cSubs. We’ve enjoyed getting to know you and learn more about this. Increasingly, we hear about successful companies like, say, Blackberry that lost their way in staying responsive to their customers’ changing needs. Yet your company, cSubs, continues to successfully innovate and grow. What aspects of your culture particularly reinforce innovation in response to [changing customer needs]?

Julie Auslander: Pam, I’m so glad that you see the importance about speaking of culture. It really is the bedrock foundation upon which everything else in the company is built. We can count on change as being constant, and what’s happened is that the rate of change, the acceleration of change has just geometrically moved forward. With that change, we all need a compass to know what direction we’re going in. Culture is that compass.

What companies that have lost their way have done is that they may have had an original culture, but as the company grew, that culture didn’t have baked into it that change was going to happen. As you grow, culture can’t be looked at in such a small way. It has to be looked at in a much larger way that can be successfully applied over many people, and a growing number of people, and a growing number of processes, and a growing number of locations, and a growing number of clients for that company.

Scott Harper: Okay; so your culture has this really central premise to it − the reason for being, what Simon Sinek calls your “why,” and it guides everything that you do, you have done and you are going to do. How does this apply to how you all at cSubs do innovation?

Julie Auslander: Our ability to innovate is an outgrowth of our culture. Without our culture, we would have no north star for which to innovate. I think that one of the things that happens to companies that get lost along the way is that it’s not listening to their clients and listening to their customers, so being customer-focused and employee-centric is not baked into their cultural model. They lose their way because innovation comes from those two aspects. I think what some companies and products that we all had an experience with you’re like, “How did they figure this out?” It doesn’t work. People go into a room and innovate. That’s not how innovation, I believe, successfully evolves.

Scott Harper: Yeah. You can’t do it in a vacuum at all. No.

Julie Auslander: You can’t. I think that many companies do that, and so what I…

Scott Harper: “This is a good idea and let’s do this,” right?

Julie Auslander: That’s exactly right. It’s one-dimensional. What I’m suggesting is that, from a culture where the basis is client and employee focused and centric, innovation will come, and it will be meaningful innovation because it’s being driven by the people for whom that innovation is being developed.

Pam Harper: Julie, when we first met, in fact, you were receiving an award because of the innovation that cSubs had specifically developed that was enabling you to sustainably grow over at least 3 years. Can you describe a little bit of what that was, so we can get a real feeling for that?

Julie Auslander: Being that cSubs is a technology company, there is a tremendous need for innovation and to continually keep innovating. What we’ve done at cSubs is we listen very closely based on our cultural imperatives to our clients and to our employees. Our employees are on the front line of taking the temperature of what needs to be done in innovation and they are reinforced for extracting that from our customers.

With that, we have been managing subscriptions for the last 35 years. We started doing that on index cards. Now, we’re doing that on a very sophisticated technological platform. The reason why that platform that we have is relevant is because it was developed with input from our clients’ needs, dreams and desires, and our employees’ interpretation of those. From working on index cards and fast-forwarding through spreadsheets and file cabinets and other innovations which were all innovative in their time, we now have this very sophisticated software.

Based on our clients’ needs, we’ve developed a product called Clarity because the subscriptions have moved from the physical world to the electronic world and they have different requirements, constraints and needs in order to stay within compliance for the use of that material.

Scott Harper: The world changes and it’s only through really getting in and interfacing intimately with your customers that you can keep up with those changes and anticipate what’s coming next?

Julie Auslander: That’s exactly right.

Scott Harper: Okay.

Julie Auslander: You don’t always get what’s coming next exactly right because it’s really predictive …

Pam Harper: Okay.

Julie Auslander: … but at least the process of being engaged in those predictions moves you forward in a meaningful way.

Scott Harper: Sure.

Pam Harper: That’s a good place for us to take a quick break. When we come back, we’ll talk more with Julie Auslander, President and Chief Cultural Officer of cSubs, about leading a company that exemplifies forward-thinking innovation. Stay with us.

Scott Harper: You are listening to Growth Igniters Radio with Pam Harper and Scott Harper, brought to you by Business Advancement Incorporated, −on the Web at www.Businessadvance.com. We enable successful companies to accelerate to their next level of innovation and success, and if you like what you’re hearing, spread the good word. Go to www.Growthignitersradio.com, select Episode 60, and use the “share links’ for Facebook, LinkedIn and Twitter at the top right of the page to tell your social media communities all about us. And while you’re there, sign up for our weekly alert of upcoming episodes so you’ll always be up to date.

Pam Harper: Welcome back to Growth Igniters Radio with Pam Harper − that’s me − and Scott Harper. Scott and I are talking today with Julie Auslander, President and Chief Cultural Officer of cSubs, about how company’s culture supports forward-thinking innovation. Julie, can you tell us how people can reach you and learn more about cSubs?

Julie Auslander: Www.csubs.com on the Web.

Pam Harper: You can access this also by visiting www.Growthingnitersradio.com and selecting Episode 60.

Getting back to our conversation, one of the things that we often see in a company’s journey of growth is that the very things that reinforce a strong corporate culture can hold them back from innovating − such as, say, promotions for people who are most successful at the established ways of doing business. How have you been able to encourage people to step out of their habits, even the productive ones I’m talking about, and decide to take new risks that serve your customers even better?

Julie Auslander: Pam, this is just such an interesting question. At cSubs, we don’t experience our culture holding us back; we experience our culture propelling us forward. I think that that happens because, from the very beginning, what we value has been baked into our culture and people understand that, and we manage the culture and the people so that it’s a living, breathing experience that our employees are interacting with every day and our clients are experiencing in every transaction.

Scott Harper: That makes a lot of sense, Julie. I think though, that the question that Pam was getting at is something that we have seen out there in the world − and sometimes with people that we work with − and that is that people can get addicted to success. “This worked and I got rewarded for this things that I did,” whatever it is, a process, a habit, and it becomes a habit.

Julie Auslander: It’s a positive habit.

Scott Harper: It’s a positive habit because it really reinforces success and, for a while that worked, but, as things change, it’s sometimes hard for people to let go of what they used to do that worked well and got them rewards and accolades and recognition and launched on to the next thing…

Pam Harper: Because it feels risky.

Scott Harper: Yeah.

Pam Harper: I guess the question is how do you enable in your culture for people to take risks, because you clearly do? It feels risky to change, for instance, say the customer needs something new. You haven’t baked it into the culture as you said. How do you do that?

Julie Auslander: I think it’s interesting because I think, Scott, you hit the nail right on the head. It really is about what you reward.

Scott Harper: Yeah.

Julie Auslander: We reward innovation. The people at cSubs don’t get rewarded for doing the same thing well. They’re much more highly acknowledged for the new thing that they may have just done well.

Scott Harper: Okay. People use the word “reward” to mean a lot of things. When you say “people are rewarded,” what does that look like? It’s more than just money.

Julie Auslander: That’s right, because money goes and comes.

Scott Harper: Right.

Julie Auslander: At cSubs, we have a very innovative program for reward. What we do is we have an employee incentive program. What we have done is identify the behaviors, habits, desires that are necessary for us to keep innovating. Therefore, it’s baked into our culture and baked into the rewards, so the cSubs-

Pam Harper and Scott Harper: Yeah.

Julie Auslander: The cSubs employee incentive program is that our employees get what we call “csubs dollars” for exhibiting, participating, developing what we feel is important and exemplifying that in their behaviors. We reward risk-taking. What happens is they get different amounts of cSubs dollars for different behaviors. There’s, of course, more dollars associated with more complex behavior. There are more dollars associated with behaviors that bring more change. At the same point within our culture, it’s very important for us that we give back. When our employees do community service, they also get cSubs dollars. Every behavior that we value within the company has a place in this reward system. Upon accumulating a certain number of cSubs dollars, the employee can go with their family anywhere in the world, stay at a timeshare and enjoy a vacation on cSubs. Not only is the employee very motivated, their whole family is out there saying, “What did you do today?”

Scott Harper: That’s great. And what’s really cool about this is this sounds like it’s in real time. It’s not waiting for a quarterly or a yearly performance review. Something good happens − here’s a recognition of that right now.

Julie Auslander: The performance review is separate, so the performance review really speaks more as to your citizenship in cSubs. Can we depend on you? What is your engagement as an employee? The rewards program really rewards specific behaviors.

Scott Harper: Sure.

Julie Auslander: What happens is, of course, the two are correlated, so people that are not receiving cSubs dollars and being rewarded don’t last within the company. We have people that go on vacation every year on us. I am so happy to send them off.

Scott Harper: Good, because they’re doing good things for the company and for your customers, and that real-time reinforcement just keeps that virtuous cycle going.

Julie Auslander: We also encourage our customers to reward our employees. We ask our customers to tell us about the innovation and benefits that our employees have brought to them and they get rewarded for that as well. Our customers are very excited about rewarding our employees.

Scott Harper: Okay, and that’s another way of tying in to the customer and making sure that you know what they value so you can respond to that. That’s really nice.

Pam Harper: What a great way to encourage innovation.

Julie Auslander: It really is. Innovation to me is really a 360 view; it’s not a 1-way view. It encompasses everybody in the process. It encompasses the employee. It encompasses the client. it encompasses the technology and, most importantly, encompasses our culture.

Pam Harper: That is fabulous, Julie. We’re going to continue this conversation about how other people can do some of these things in their own company, but we’re going to take a quick break right now, and,when we come back, we’ll talk more with Julie Auslander, President and Chief Cultural Officer of cSubs. Stay with us.

Scott Harper: Pam, as some of our listeners may know, we speak at events, conferences and company off-sites. Can you tell our listeners why our clients engage us for this?

Pam Harper: They are seeking new insights for dramatically accelerating company transformation and growth. They’re also seeking new leadership insights about themselves, their teams and their organizations so they can make bold, new decisions about strategy and implementation. It’s been especially rewarding to find that some of our company off-sites have resulted in breakthrough decisions that have generated as much as tenfold growth over 5 years.

Scott Harper: So contact us today at www.Businessadvance.com to arrange for a brief call to discuss your needs and options for helping you achieve your most important goals.

Pam Harper: Welcome back to Growth Igniters Radio with Pam Harper and Scott Harper. Over the last 2 segments, Scott and I have been speaking with Julie Auslander, President and Chief Cultural Officer of cSubs about her company’s culture of innovation that anticipates and responds to changing customer needs. Julie, how can people find out about cSubs?

Julie Auslander: We’re on the Web, www.csubs.com. I will look forward to hearing from you.

Pam Harper: Okay. Again, you can access this by visiting www.Growthignitersradio.com, Episode 60. Now, let’s get back to our conversation.

We’ve really enjoyed hearing about these different ways that you’ve built into your cultural responsiveness to customers and their new needs, their evolving needs. Let’s talk about immediately useful ideas, so as soon as somebody is done listening, they can go back and think about it and make some new decisions about things that they could possibly do to reinforce their own culture of innovation.

Julie Auslander: I think it’s really important that people look at what their culture is and make sure that each person in their organization from the bottom to the top understand, and can tell you what that culture is and can tell you how that culture impacts what they do and how they impact the culture. That’s the very beginning.

Scott Harper: You say that “look at your culture.” How do you do it? How can somebody look at their culture and find out those things that you’re saying that are so important?

Julie Auslander: I think it starts with saying, “What is our culture?” and maybe polling your constituents, your clients and your employees, and asking what is your culture, what is cSubs’ culture?

Pam Harper: It is hard for people to see it sometimes.

Julie Auslander: That’s right, because it doesn’t get talked about and it’s not…

Pam Harper: That’s right, so having that discussion is the first piece.

Julie Auslander: That’s right.

Pam Harper: It’s the first point.

Julie Auslander: That’s right, and then rewarding people for participating in that conversation. Explain to people that culture is important, everybody has one whether you know it or not. Take our culture out of the closet and put it in front of people so that we’re all working and rowing in the same canoe.

Pam Harper: It’s interesting. I’ve had conversations with people about this. It is fascinating how people don’t always look at culture as comprehensively or as clearly you do and that we do, too. I mean, I look at it as all the values and beliefs and the practices of an organization, which you’ve exemplified − many that have to do with how we conduct business day in and day out. When you think about it that way and you’ve been talking it that way, it’s easier to see.

Julie Auslander: Absolutely. It’s the only way to effectively incorporate culture into an organization. Every organization has a culture whether you know it or not.

Pam Harper: That’s right.

Julie Auslander: I’ll give you 2 very quick examples. I was at an event at a very high-end hotel in New York City last week, and the waiter spilt something on the person next to me and was very concerned about escaping before anybody knew, and I turned to the waiter and said, “You just spilt that whole cream thing on the back of this guy’s suit,” and he just disappeared.

Scott Harper: Oh, dear.

Julie Auslander: You contrast that to a restaurant I was in about a month ago where they spilt butter sauce on one of the people we were with, and they came over. They had a process in place for that …

Scott Harper: Oh, my.

Julie Auslander: … because … within their culture because it happens.

Pam Harper: That’s right.

Julie Auslander: This is part of what happens in that business. Instead of trying to sweep it under the table, which is clearly the culture in that the big, expensive hotel, in this restaurant, the manager comes over and says his piece, comes over with a gift certificate for a free dinner. You don’t have to ask.

Pam Harper and Scott Harper: Wow.

Scott Harper: That’s culture.

Pam Harper and Scott Harper : Yes, it is.

Julie Auslander: It’s palpable to the person, to the customer who was having that experience. Within both of those organizations, there’s a culture that starts with everybody in the organization because, in every way, every day, each person in that company is delivering culture, even people that are not client-facing. The people within the organization that we call “back-office” that really just interface with your employees …

Scott Harper: Yeah?

Julie Auslander: … are they embodying culture?

Pam Harper: Absolutely.

Julie Auslander: Are the employees happy to deal with them? Do they remind the employees of what the culture is and the values?

Pam Harper: Is it the same culture?

Julie Auslander: Is it the same culture? That’s really the point of having everybody contribute to this culture, writing it down in a very public space, having it up there so people can see it, but also talking about it every day in every way …

Pam Harper: … and living it.

Julie Auslander: … and living that culture; right. I feel so strongly about it. That is why I assumed the title of Chief Culture Officer. I believe that, even though I function in the role of CEO, without culture and me holding the culture that cSubs has, there would be nothing for me to CEO about.

Pam Harper: You’ve got a great point, Julie. What’s another practical thing that people can do? The first one was absolutely right.

Julie Auslander: Yeah, so the first one is to just make sure that everybody is operating under the same culture and to have it visible so that people can see it. The second thing that I think is very important, we always succeed at what we measure. Whether it be our weight, our daily steps, our savings, we need to have ways of measuring. We need to identify what those measures are. What are we looking at culturally that we feel is important? We need to poll everybody within the organization to make sure that they understand what that culture is and can talk to us about how what they do impacts on the culture and impacts on the clients, and then we need to continually measure by doing a 360 review.

We are constantly asking each employee and our clients how we are measuring up against our culture, and we get a rating. Anything less than 90% is not acceptable to me.

Scott Harper: Yeah, we absolutely believe and agree with you that you get what you measure. To take that a little bit further, you better be measuring the right things, because the law of unintended consequences can always come up and bite you. If you’re measuring things that actually don’t reinforce the behavior you want, people are going to do things that you don’t really want them to do. And they may not do things that you may not be measuring, but are really, really important, so you’ve got to pick those things carefully.

Julie Auslander: That’s exactly right.

Scott Harper: In this case, the responsiveness is the key?

Julie Auslander: Yeah, and it’s not you. The “you” is not one person. The “you” is a global constituency of employees and clients.

Scott Harper: There you go.

Julie Auslander: The mistake that people make − and that’s why the word “you” troubles me − because “you” implies one person. This is a collective effort. It only works if each and every person gets it and does it.

Pam Harper: We agree with you 100%, Julie. We have two. What’s a third thing that people can do?

Julie Auslander: I think it’s very important that leaders of an organization continually walk their culture. I think that people are very − that people have experience with either the concept of Undercover Boss, the TV show, or the Secret Shopper, and I think that what those bring to light is that what actually goes on is very different than what you think is going on.

Scott Harper: Yeah.

Julie Auslander: It’s very easy for somebody to think in a management role that they’re delivering the culture, but nobody has gotten the memo, so … and it’s not this 360 view that I’m talking about. It’s a one-way look at what you’re doing. Again, I can’t reiterate clearly enough and strongly enough that the things that are important to the culture… one of the things that’s important to our culture is we get rewarded for making mistakes because everyone in my organization will tell you that if you fall forward, you’re still moving ahead. We reinforce that and we value that. It’s really important that the cultural aspects that move a company forward and enable them to innovate are baked into the cultural statement that’s developed, and that each person in the organization, each person, whether it be the person that cleans the offices to the CEO, to the clients understands people don’t do business with companies, they do business with people and it’s people that deliver the culture.

Scott Harper: By making those decisions to get out there and really figure out what’s … and see what’s going on and experience it with people, you are uncovering or even eliminating secrets, those unknown things that are happening that can really rise up and bite you in the ankle.

Julie Auslander: Right, and I think that that’s what happens with the Secret Shopper or the Undercover Boss, that people have developed end-zones and worked around things that no longer really serve the clients and don’t serve the employee, but it’s the best that they could do because nobody was listening to their needs.

Pam Harper: That’s right, so it’s a way to stay in sync with your customers and make sure that everybody is in sync with each other as your company continues to change and grow, as your customers are out there continuing to change and grow.

Julie, this has been so helpful. Love the examples that you’ve been giving. Can you leave us with just a thought to keep in mind?

Julie Auslander: What’s important gets done. What’s measured gets done. Culture is the bedrock and basis for everything that needs to get done and needs to get measured. I strongly suggest that you do a 360 view of your clients and employees and understand what your culture is, and have each person and every person in your organization be able to articulate what their role is in delivering that culture.

Pam Harper: Okay. Thank you very much again for being our guest today.

Julie Auslander: You are most welcome. This is always a pleasure. I look forward to the next time.

Pam Harper: Absolutely.

Scott Harper: Yeah, so do we, Julie. Thank you so much, and thanks to you out there for listening to Growth Igniters Radio with Pam Harper and Scott Harper. To check out resources related to today’s conversation, share on social media, find out about upcoming episodes, or open a conversation with us, go to wwwGrowthignitersradio.com and select Episode 60.

Pam Harper: Until next time, this is Pam Harper …

Scott Harper: … and Scott Harper …

Pam Harper: … wishing you continued success, and leaving you with this question to think about:

Scott Harper: What decisions do we need to make that will sharpen our ability to read the changing market and translate that to innovation that matters to our customers?