THIRD EDITION
Copyright © 2017 by Robert Spector and breAnne O. Reeves. All rights reserved
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada
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Library of Congress Cataloging-in-Publication Data:
Names: Spector, Robert, 1947– author. | Reeves, breAnne O., 1980– author.
Title: Nordstrom way to customer experience excellence : creating a values-driven service culture / Robert Spector, breAnne O. Reeves.
Other titles: Nordstrom way to customer service excellence
Description: Third edition. | Hoboken, New Jersey : John Wiley & Sons, Inc., [2017] | Earlier edition published as: The Nordstrom way to customer service excellence : a handbook for implementing great service in your organization. | Includes bibliographical references and index. | Identifiers: LCCN 2017019609 (print) | LCCN 2017033173 (ebook) | ISBN 9781119375371 (pdf) | ISBN 9781119375388 (epub) | ISBN 9781119375357 (pbk.)
Subjects: LCSH: Customer services—United States—Handbooks, manuals, etc. | Nordstrom (Firm)—Management. | Department stores—United States—Management.
Classification: LCC HF5415.5 (ebook) | LCC HF5415.5 .S626785 2017 (print) | DDC 658.8/12—dc23
LC record available at https://lccn.loc.gov/2017019609
Cover Design: RSi
In loving memory of my parents,
Fred and Florence Spector,
who taught me The Spector Way:
Work hard, be good, do well.
—R.S.
Thank you, Clara June Reynolds,
for reminding me every single day,
to stay silly, be nice, put others first,
enjoy life, and most importantly, have fun!
—B.O.R.
“Your beliefs become your thoughts,
Your thoughts become your words,
Your words become your actions,
Your actions become your habits,
Your habits become your values,
Your values become your destiny.”
—Mahatma Gandhi
My Nordstrom journey began in 1982, when I became the regular freelance correspondent in Seattle for Women's Wear Daily and the other trade newspapers that then comprised Fairchild Publications.
One of the first companies I wrote about was Nordstrom, which was then a strictly West Coast retail chain, but was beginning to gain a national reputation for its culture of customer service. As a native of New Jersey, whose first job out of college was writing retail advertising for Bamberger's department store (a division of Macy's), I was fascinated by the Nordstrom culture of taking care of the customer. I remain fascinated to this day.
In 1990, I was contacted by Elizabeth Wales, a Seattle literary agent, whose next‐door neighbor was Patrick McCarthy, then Nordstrom's number one salesperson. Elizabeth asked me if I'd be interested in writing the book with Patrick. You know what my answer was. Five years later, John Wiley & Sons published The Nordstrom Way: The Inside Story of America's Number One Customer Service Company. It quickly became a bestseller, and it changed the course of my life.
As a keynote speaker, I've had an opportunity to speak to every kind of business you can imagine (and some you can't imagine) throughout the United States as well as in 26 countries. It's been quite a ride!
And as an author, I've had the unique opportunity to periodically revisit Nordstrom, both literally and figuratively (as we explain in greater detail in the Introduction). Each time I research and write a version of The Nordstrom Way, I learn something new. Each time I learn something new, I have something new to teach. Over the past few years, I have shifted some of my time to teaching business students at the University of Washington's Bothell campus, and at Western Washington University in Bellingham. I believe that it's essential for students to not only understand traditional business skills but also to understand what it means to operate a business or to be a stellar employee—viewed through the lens of these values that we have identified that are crucial to Nordstrom's success. I tell my students that regardless of whatever field they choose, the values of The Nordstrom Way will serve them well.
I've also had the opportunity to be an adviser and thought leader to organizations large and small around the world. I particularly enjoy the breakout ideation sessions where people at every level of the organization are given the opportunity to brainstorm on how they can help their organization become the Nordstrom of their industry. After leading and observing these brainstorming sessions, where people talk about how they can do their jobs better, I've come away with what I call the Three Immutable Truths:
With all of that as a backdrop, I want to acknowledge all the people who helped to make possible all the versions of The Nordstrom Way.
Deep and heartfelt thanks to:
ROBERT SPECTOR
Bellingham, Washington
My Nordstrom adventure began in 2009, when I met Robert Spector. After a successful run in the corporate sales and marketing world, I decided to venture out and start my own business(es). I swore that I would never sit through another sales training, keynote, or “sales rally” again. I swore I would never sell anything to anyone that they did not need.
After a fateful meeting with Robert and after many happy‐hour conversations over glasses of wine, Robert hired my modest firm to support the launch of his newest book, The Mom & Pop Store. We were tasked with hosting the book's first launch party, to be held at Capers, a home‐furnishings store in West Seattle, where we were both living at the time. Most book launch events go a little like this: show up, schmooze with the author, get a book signed, have a paper cup full of coffee, tea, or wine, then leave.
Well, I had a different idea of what a book signing should look like. Maybe this is the Nordstrom in my blood. My team and I took it upon ourselves to get to know Robert and find out where he got his morning coffee, his afternoon sandwich, his happy hour, and oh so much more. How's that for getting to know a client?
We continued on our Nordstrom Way journey by having each of his favorite mom‐and‐pop establishments run a special the day of his book launch in West Seattle: His fave coffee beverage at Hotwire Coffee, his fave breakfast plate at Easy Street, his fave sandwich at Husky Deli, his fave cocktail at Fresh Bistro. You get the point. Additionally, we had Elliot Bay Brewing provide a keg of his fave Northwest beer, and Northwest wine as well. We packed the house. Everyone had a great time. And guess what? It had nothing to do with the book. Or Robert. It had to do with the customer experience. It had to do with partners and vendors. It had everything to do with caring about others.
Aha moment number one: I need to read The Nordstrom Way.
Aha moment number two: The Nordstrom Way is more than a book. It is more than a keynote. Let's create platforms to help companies around the world become better based on this knowledge.
During one of our many meetings, Robert asked me a life‐changing question: “Would you like to own half of The Nordstrom Way?” I said, uh, yes! The thought of leveraging the material from The Nordstrom Way in order to support the success of others was beyond provocative to me. From then on, my focus was on digging into the culture of Nordstrom and sorting out the values that make Nordstrom what it is.
As we identified the values that sustainably drive Nordstrom, I could not help but compare them to my family and upbringing. This was the moment when I knew for sure that I was in the right business.
Empower people to be good and do good. It is that simple.
I would like to thank:
BREANNE O. REEVES
Bellingham, Washington
As a Seattle native, I've had a front‐row seat to Nordstrom's growth from our little corner of the world to 39 states, three Canadian provinces, and one commonwealth, while earning an international reputation (with online customers in almost 100 countries!) for providing the gold standard in customer service experience.
I've had the pleasure of knowing several members of the Nordstrom family and I've expressed to them my admiration for how they conduct their business. Nordstrom, like Starbucks, exemplifies our Northwest values that combine competitiveness with caring.
In our hypercompetitive, ever‐changing, ever‐challenging retail world, where concepts come and go and where competitors rise and fall, how has Nordstrom been able to survive and thrive for almost 120 years? Robert Spector and breAnne O. Reeves provide the simple answers to this existential question.
As the subtitle indicates, this is a book about creating a values‐driven, service‐obsessed corporate culture that encourages, motivates, rewards, recognizes, and compensates employees to consistently deliver a world‐class experience to customers, one customer at a time.
As the world economy becomes more and more about relationships and connections that are built on the foundation of trust and respect, Nordstrom's principles of personal leadership are more important and relevant than ever.
At Starbucks, we believe what Nordstrom believes: The employee experience determines the customer experience. If you regard employees and customers as human beings, everything else will take care of itself. It's an article of faith that if you engage your staff as partners (not assets or labor costs), they will achieve results beyond what is thought possible.
Through four generations of family leadership, the Nordstroms have shown that they know who they are, and that they know the kind of people they want to attract to their team. The Nordstroms bring clarity and honesty in regard to who they are, where they want to go, and how they're going to get there. They are clear about their purpose, values, and goals, and they draw people who are aligned (both individually and collectively) with the very same purpose, values, and goals.
Culture is a funny thing. Changing it is not about talking about it; it's about living it. People will rise or fall to the expectations that the organizational culture puts on them. If cultural expectations are high, the chances are good that they will be met. Conversely, if expectations are low, those expectations will also be met.
Nordstrom believes in doing the right thing. The company seeks out people who want to do all the right things for all the right reasons. They seek out individuals who can think independently and who make the goal of creating a satisfied customer their highest priority. Nordstrom believes in throwing out the rules—real and imagined—and promoting empowerment and autonomous thinking. This philosophy is epitomized in their only rule: “Use Good Judgment in All Situations.”
In many cases, in most organizations, the rulebook goes way too far. It tries to tell people how to be instead of explaining what they're trying to do. At Starbucks, we always said that we need “recipes, not rules.”
Again, clarity of purpose is essential. Nordstrom is clear that every decision the company makes is for the benefit of customers, and that Nordstrom employees—both on the frontlines and in support—are crucial to enhancing the customer experience.
Trust is the cornerstone of all human interaction, be it social, emotional, or commercial. Caring—for coworkers and customers—is a sign of strength. Without trust and caring we'll never know what could have been possible in our organization.
High‐trust companies hold their people accountable, treat them like responsible adults, and encourage them to take ownership of the customer experience. They want their people to be true to themselves and to their values. Positive actions and decisions build trust and show that you care. The best Nordstrom sales associates will do virtually everything he or she can to make sure a shopper leaves the store a satisfied customer. As my friend Bruce Nordstrom says, “The happiest customer is the one who leaves the store carrying a Nordstrom shopping bag.”
“Servant Leadership” is a philosophy and set of practices that I have tried to adhere to—from the days of watching my parents running their small grocery store in Seattle, to all my years at Starbucks, to the life I live today as an author, speaker, and mentor. The Nordstrom family and every successful Nordstrom manager, buyer, and executive represent the ideal of servant leadership. We are here to serve and support our team, not the other way around.
At Starbucks, we believe that there is no conflict between treating your people with respect and dignity and making a profit. We simply stated that respect and dignity are essential, which is why respect and dignity were factored into the price of every cup of coffee we sold.
Robert and breAnne have identified core cultural values that are absolute necessities for every organization: trust, respect, loyalty, awareness, humility, communication and collaboration, competition and compensation, innovation and adaptation, and give back and have fun. We can all agree that these values are essential to loyalty and longevity.
In this compelling and entertaining book, Robert Spector and breAnne O. Reeves show how any organization—including yours—can create a lasting customer service culture by attracting people who buy into your nonnegotiable core values.
Chock‐full of stories of exemplary customer service, unselfish teamwork, fearless innovation, community and global citizenship, and good old‐fashioned fun, this book will make you laugh, shed a tear or two, and convince you that your organization has the potential to become the “Nordstrom” of your industry.
If that's your goal, what better time to start than right now?
HOWARD BEHAR, retired president,
Starbucks North America and Starbucks International
A few years ago, Blake Nordstrom, copresident of the company with his two brothers, scheduled a lunch with the chief executive officer of another famous Seattle company. The CEO asked Blake if he wouldn't mind stopping by the tailor shop of the downtown Seattle Nordstrom flagship store on his way to the lunch, and bring with him a couple of pairs of slacks that the CEO had arranged to have altered.
“Blake said, ‘Sure, no problem,’” the CEO remembered. By the time the two executives met for lunch, both of them had forgotten about the pants. “That evening at nine o'clock, there's a knock at my door. There's Blake with those two pairs of pants. I said, ‘Man, that's what I call service.’”
In a sense, Blake's personally delivering those pants is the perfect metaphor for The Nordstrom Way. Nordstrom's culture encourages entrepreneurial, motivated men and women to make the extra effort to give customer service that is unequaled. “Not service like it used to be, but service that never was,” reported Morley Safer in a profile of the company on the CBS television program 60 Minutes. “A place where service is an act of faith.”
Morley Safer made that observation in 1990. Although much has changed since then, Nordstrom's commitment to service has never wavered.
When The Nordstrom Way was first published in 1995, it struck a chord with countless organizations in a broad variety of industries all over the world. Many hundreds of thousands of copies and four iterations later, The Nordstrom Way continues to serve as an inspiration for virtually every sector of international business. Nordstrom endures as a standard against which other companies and organizations privately (and often publicly) measure themselves.
“If all businesses could be like Nordstrom,” said Harry Mullikin, chairman emeritus of Westin Hotels, “it would change the whole economy of this country.”
“The Nordstrom Way,” the phrase that we have helped to popularize, is shorthand for a customer experience that is sui generis. Through all the changes that Nordstrom and the retail industry have gone through over more than a century, the Nordstrom Way is still in a class by itself.
It must be noted that Nordstrom did not suggest we write The Nordstrom Way nor did the company commission its publication. Nevertheless, when the original book was written, the company made its top executives, managers, and salespeople available for interviews. Through all the different versions of this book that we have written over the years (which we will explain in greater detail), Nordstrom has cooperated in helping us to tell their ever‐evolving story.
This is a completely different book from the first and second editions, just as the first and second editions were completely different from the 1995 book and the 1997 trade paperback.
In 2005, for the 10th anniversary of the original publication, we initially thought of adding a new chapter or two. But upon reviewing the material, it was obvious that much of the book was too dated to be relevant. For example, the original book didn't mention something called the Internet. By 2012, the 2005 first edition was also dated. Hence, the necessity for the book you are now reading. Our books have evolved just as Nordstrom has evolved. Our books reflect both Nordstrom's bedrock culture and its understanding that survival requires perpetual adaptation and evolution.
This third edition is coauthored by breAnne O. Reeves, cofounder and partner of our consulting company RSi, a thought leader in customer experience. This book is her vision, based on our years of research and working with clients in many different business sectors all over the world.
This is not a book about selling shoes or clothes or cosmetics or jewelry. As the subtitle spells out, this is a book about creating a values‐driven, service‐obsessed corporate culture that encourages, motivates, rewards, recognizes, and compensates employees to consistently deliver a world‐class experience to customers.
Each one of us is an expert on customer service. At one point or another during the course of our day, every one of us plays the role of the customer. We all know the difference between good service and bad service. You don't have to read yet another book to understand this.
So, then, why is good customer service so rare?
Picture in your mind a customer service counter. On one side of the counter is you, the customer. You know exactly what your expectations are: a good product or service at a fair price. If there's a problem, you want it taken care of as quickly, seamlessly, and painlessly as possible. Simple stuff, right?
But a funny thing happens to people when they move to the other side of the customer service counter (or the front desk or the reception area or the phone or Internet) where they are the ones who are giving service as opposed to receiving it. Unfortunately, this is the place where their behaviors are determined and dominated by the rules, the process, the manual, the bureaucracy, the way it's always been done:
When we are customers, we don't want to hear those excuses. So when we are dealing with our customers, why would we want to offer up these lame excuses to our customers? It's as if someone hit the “delete” button on our customer service memory. We forget about the Golden Rule, about empathy, about the customer's experience. Because organizations are so wrapped up in the day‐to‐day minutiae, it's difficult for them to consistently give customer service.
Although we all know that the key to success is a satisfied customer, few of us are as single‐minded as Nordstrom in creating and sustaining a customer‐obsessed culture and hiring people who fit the culture and who happily provide that exemplary service—because it's demanded and expected of them.
When it comes to singing the song of customer service, anyone can recite the words but few can carry the tune.
Most companies, large and small, base their business model on their own internal systems. These systems are set up to make life easier for the company not necessarily for the customer.
One three‐panel Dilbert cartoon strip, by Scott Adams, illustrates this mind‐set. In the first panel, the lead employee tells two others: “Our goal is to ship a million units this quarter.” In the second panel, another employee asks: “Do we have any goals that involve making customers happy?” In the third panel, the lead employee responds: “I'm talking about our goals; not theirs.”
When we show that cartoon strip in our keynotes and training sessions it inevitably gets a knowing laugh from the audience. It's funny because it's true. Too true.
On the other hand, because Nordstrom is dedicated to making life easier for the customer, it believes its job is to adjust to the customers' needs at the time of the purchasing decision. Nordstrom doesn't determine what good service is; the customer does.
“From the sales floor to support, no matter where we work, our challenge is to constantly put the customer at the center of everything we do,” said Blake Nordstrom, who runs the company with his brothers Pete and Erik. “The ultimate filter for all our efforts should be: ‘How is this meaningful to the customer and will it increase sales?’ If something is important to the customer, we should find a way to deliver it. If it's not important to the customer, we need to question if it's worth our time and focus.”
Nordstrom has no official mission statement or value statement, “because sometimes that becomes the flavor of the month,” said Blake. Mission statements “are only as good as the words on the paper.”
Nordstrom is customer‐driven not customer‐focused. “Customer‐driven” means that Nordstrom puts the needs of the customer in the center of every decision on how and where to allocate resources. It means putting the customer in the driver's seat and setting aside notions and historical preconceptions of how the customer wants to be served. Customer driven is about empowering customers to dictate their terms when it comes to the different ways they choose to shop.
This mind‐set is significant because of the astonishing speed with which the shopping experience is changing and how customers are reconsidering the service experience. Customers want to do business with companies that swiftly recognize and respond to their needs and desires.
Nordstrom has been ranked as a retail industry leader in customer satisfaction by the American Customer Satisfaction Survey in each and every year since 1995. Nordstrom has consistently ranked as America's favorite fashion retailer in Market Force Information's annual survey, which cited Nordstrom as the industry pacesetter in (1) service, (2) ease of shopping, (3) ambience, and (4) brand value.
Nordstrom has long been a popular subject for study among authors of customer service books and educators at business graduate schools such as Harvard and Wharton. Roll Call, the newspaper of Capitol Hill, once advised press aides for members of the United States Congress to use the “Nordstrom approach” when trying to sell producers of political talk shows on the benefits of booking their bosses. The New York Times Magazine noted that a minister in Bel Air, California, told his congregation in a Sunday sermon that Nordstrom, “carries out the call of the gospel in ways more consistent and caring than we sometimes do in the church.”
In an article in the Nashville Tennessean newspaper, a writer called for local schools to create a “customer‐centric culture,” to create “the loyalty and enthusiasm that is crucial to participation, funding, and community pride. The Walmart model is good for some things, but if it is quality you desire, Nordstrom is the way.”
Businesses of every kind strive to become the Nordstrom of their industry. Over the years, we have collected dozens and dozens of examples of this metaphor.
Recreational Equipment Inc., a Seattle neighbor, has been called “the Nordstrom of sporting goods stores” and Specialty Foods magazine described A Southern Season, a store in Chapel Hill, North Carolina, as “the Nordstrom of specialty food.”
A top broker for Century 21 once told Fast Company, “I want people to think of me as the Nordstrom of real estate.”
A dean at Fullerton College in California vowed to create, “the Nordstrom of Admissions and Records.”
The University of Colorado Hospital installed a baby grand piano (a popular feature in many Nordstrom full‐line stores) in its lobby and began advertising itself as “The Nordstrom of Hospitals.”
You can find similar comparisons in yoga studios, restaurants, cloud computing, office furniture, public libraries, construction supply distribution, hot tubs, dental offices, pet stores, thermal rolls, foundries, workplace giving, doors and windows, and contract consulting.
We've even found “the Nordstrom of garbage collection.” I don't know what its return policy is, and I don't want to find out.
Even Nordstrom uses this metaphor. In describing the company's Rack division of clearance stores, Blake once said, “We like to think that the Rack is the Nordstrom of the discount world.”
So, what does it mean to be the Nordstrom of your industry? It's not just a smiling face that greets you when you enter the department. It's covering every aspect of the business—the things the customers see and the things that they don't see.
How can an organization create a culture and atmosphere to provide Nordstrom‐like service? This book answers those questions and shows you how to do it.