I have started my MBA lectures on Organisational Behaviour which I thought would be quite boring but so far it has been very, very thought provoking. The underlying principles of organisational behaviour studies look to understand how people and groups behave in organizations.
We had been debating the role of rules in the work place and the balance between lots of rules like government where rules govern everything contrasted with an organisation like Nordstrom which has only one rule, “Use good judgement at all times”.
I have learned that the strict definition of a bureaucracy is an organisation where the rules are inflexibly applied (the computer says “no” effect) and that the opposite end of this is an adhocracy, where there are few rules, lots of flexibility, and relies more on employees judgement.
This is all well and good but how might this affect your brand and your reputation. I had a perfect example of this today.
I was in Homebase (a DIY store) today and I was trying to return an item that I bought 29 days ago. I spent quite a long time queuing before being served and when it was finally my turn I presented my item and a valid receipt. The lady behind the desk said “I am sorry sir but you can only return an item before 28 days”. I looked at her in total amazement this was one day late surely she could make an exception or see this from my point of view? But no, “the rules are the rules”.
I left the store in amazement and I did not have the energy to argue my point for the sake of a £5 door lock. This total reliance on the rules with no flexibility has meant that Homebase have saved themselves £5 to their bottom line. This to me seems very short sighted, I will now not shop at Homebase so they have lost twenty years of my custom. More so than that I have written this post and if only one person reads it that might persuade them not to shop at Homebase either. Then there is the multiplying effect of me telling my friends and family of the childish behaviour and perhaps they might think twice about shopping there.
Contrast this with the much more flexible B&Q (a rival DIY store), earlier in the year I took some items back that I did not even have a receipt for and they issued me a credit note. This then led me to buy some tools, and then later in the year a kitchen and some wardrobes, which has resulted in a lot more profit to their bottom line.
It seems so obvious to me, give your front line employees the flexibility and empowerment to make customers happy and coming back to your store. Of course there has to be controls on this perhaps you set a maximum value of £50 before they have to get authority from a more senior manager. Inflexibly applying the rules in the long run is a recipe for disaster.
















