Corporate Attitude Flows From the Top Down

Dear Friends,

It seems to me, the attitude towards customers shown by the lowest employee in a company, is a direct effect of the leadership of that company. Take Best Western and United airline for examples. They are both in the service industries, they both cater to travelers and as a result both are customer oriented. One, United, is an airline, the other Best Western is a hotel chain. In all human groups the leader sets the example which the people, employees in this case, follow. It should seem obvious to anyone that the attitude of the leadership transmits to the lowest leve of an organization, but sadly, this truism is lost on many if not most in the new class. This has profound implications for those of us who invest our hard money.

That people follow their leaders was a major tenet of Confucius’s philosophy. He of course was teaching about the people following their leaders into corruption but the paradigm holds true for any aspect of a group of human beings. It is innate to humanity that the leadership leads the followers, in both orders, attitude and intention. When the leadership of a company holds that the customers are the enemy that attitude will permeate every corner of that company. The opposite holds true as well, when the leadership of a company values their customers that attitude will also permeate a comapny.

I recently flew United airlines. That trip was a disaster from stem to cudgel. United apperently forgot to schedule a flight crew and so stranded me for a day. The only person I met that worked for United that was not rude was a manager in that airport. Other than that man the rest of the employees were rude, incompetent and actually seemed to relish in annoying the customers. The second day was even worse than the first. Suffice it to say I will never fly United again. Without question the attitude towards customers at United is that the customer is the enemy. Had I owned any United stock I would have sold it the moment the market opened Monday.

On a more recent trip I stayed at several Best Western hotels. The employees were kind, helpful and courteous. The company allowed my pet to stay and offered a well prepared breakfast. Today people travel with their pets more and more. Such bending to the customer’s needs is a sign that the company takes it’s customer’s needs seriously. Other than a finicky Wi Fi… he experience was uniformly good. Clearly the attitude towards customers at Best Western is that the customer is king. I am considering buying stock of the company that runs Best Western.

If top management of a company has no consideration of it’s customers how much less to their employees? When a company treats their employees horribly how well do you suppose it will treat their customers? Both speak to the attitude of the new class management to other human beings. Companies are built upon a foundation of care for our fellow man as such those companies that are considerate of their employees will probably care for their customers and visa versa.

Of course these examples are anecdotal, but empirical evidence is always based on a piling up of anecdotal evidence. The attitude of the top management of all companies is reflected in their employees. That attitude, either of enmity or care, flow from the top down and colors every decision every employee makes. Since the profits of a company are based on it’s customers perception of value, except in the case of monopoly, the corporate attitude is reflective of the potential longevity of a company. It’s business model, whether to fail or to succeed, is the impression the customers get when they use the services of that company… so when looking to invest your hard earned dollars, look to a company that serves it’s customers well, provides value and treats their employees well and you will be well served by your investments.

Sincerely,

John Pepin

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