Profiting at the expense of partners is a short cut to a dead end

Loyalty can be earned only when leaders put the welfare of their customers and partners ahead of their own self-serving interests. Herein lies the paradox of loyalty. If it is really about self-sacrifice – that is, about putting principles and relationships ahead of immediate personal financial gain – what relevance can it possibly hold for business, which is in large part driven by self-interest?

There is indeed a high road in business, and it is the only road to lasting success.

A 5% increase in customer retention yields a 75% increase in customer net present value

Play to win/win: Profiting at the expense of partners is a short cut to a dead end.
Leaders who want to build loyalty and generate the loyalty effect must exercise extreme discipline to protect their partners’ interests. They know that the key to winning is not to make sure their competitors lose, but to make sure their partners win.

Play where you can win
If you want to win/win, you must have the discipline and focus to play only where you can win. CEOs of top loyalty companies know precisely where they have the wherewithal to win and where they don’t. They don’t compete for every new business that seems profitable for the moment; they invest only where they see the potential for building sustainable assets and relationships.

Protect your partners’ interests
Only by helping partners reach for the stars – by targeting customer value that is even better than the best – can a leader ensure that the organization will stay on the high road to success. Too many leaders shrink from the demands of this goal and don’t insist that their organizations target the very best value. It is much easier, and seems less risky, to shoot for fair or reasonable value.

To ensure that your organization can continue to set the standards of excellence, you must focus on the basics of cost, quality, and timeliness as well as on discovering new levels of excellence for your customers’ lifetime experience.

Play to win/win to achieve sustainable growth. Loyalty leaders’ growth rates surpass industry averages across the board.

Want to find out more about how leading companies thrive in a customer-driven world? And how you can implement the fundamentals that drive sustainable growth?

Fred Reichheld is a Bain Fellow and founder of Bain & Company’s Loyalty Practice, which helps companies achieve results through customer and employee loyalty. He is the creator of the Net Promoter system of management.

Consulting Magazine chose Fred as one of the “25 Most Influential Consultants” in its 2003 annual survey. According to The New York Times,” [He] put loyalty economics on the map.” The Economist refers to him as the “High Priest” of loyalty.

Fred is a frequent speaker at major business forums and his work on loyalty has been widely covered in the Wall Street Journal, New York Times, Financial Times, Fortune, Business Week and The Economist. In 2012, Fred Reichheld will be visiting Sydney for the first time and will be speaking at Australia’s leading two-day executive event for entrepreneurs and
business leaders of growing companies.

Whether you’re starting a business or operating in a large organization, Fred Reichheld workshop will provide a blueprint for long-term growth and success. (Find out more)

Special rates available for Optus Business readers. Book Online Now or call 1300 721 778.

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