Just F1-off!

Jun 22 2005 by Max McKeown Print This Article

A Formula One car can accelerate from zero to sixty miles per hour in about one and half seconds. It's not the fastest thing on land but it's pretty impressive for a car.

A Cheetah, the Ferrari of the Feline world, accelerates rather more slowly, can only hit 70 mph (compared to an F1 car's top speed of 240-odd mph) and has to pause for breath after only 30 seconds.

But the prize for acceleration goes to the humble flea with a rate of acceleration 20 times that of the space shuttle when taking off.

The speedster F1 machines are less impressive when they are grounded due to "technical difficulties", however. The seven teams which elected not run at last weekend's US grand prix did so because they were party to an extreme piece of misjudgement by a tyre manufacturer who was unable to vouch for the safety of it's own circular product.

After two accidents during the practise sessions caused by Michelin tyres that inexplicably 'burst', the company felt unable to warrantee their use in the race itself which meant that the teams felt unable to race which meant that Schumacher (the seven-times champion who has yet to win a race this year) managed to win a pretty meaningless, race.

The 100,000 fans and U.S. F1 fans will travel from all over the country for this one accessible event of the year - were (and are) fuming. True to their cultural heritage, many are already suing for their ticket, accommodation, travel, and lost time.

The first to apologise was the owner of the track who hadn't made the decision. Next was Takuma Sato, a driver for BAR-Honda who sent a "sincere apology" who hadn't made the decision. Champ Car, US motor racing competitors, also apologised for F1's ineptitude and offered to let anyone with an F1 ticket stub into their next race in Cleveland but again they hadn't made the decision.

The apology should come from Michelin and the teams who jointly made the decision. They should be saying sorry because they couldn't figure out a way of letting the race go ahead, perhaps by using tyres from their competitors (even with a deduction of points) or shipping in new tyres (even if they were disqualified). Both solutions would still have given spectators a race worth watching.

This inability to apologise for incompetence is ingrained into the culture of many organisations. Consider how credit card companies can fail to protect my privacy (and that of 40 million other customers) and not say sorry (although CardSystems the company behind the security breach may be fined $500,000 none of which will go to customers.).

When I don't pay a credit card bill on time I get fined an extra 20 and am told "that it is your responsibility, your account, and your fault".

And yet when they make a mistake by not sending me a text message or an email to remind me about a payment date, "because the system didn't work" - they never give me 20 because it's "their fault".

This approach is insulting because it is one-sided. It is maddening because the relationship is soured by the 'contempt' of the corporation for the customer. The organisation doesn't think that the customer (or voter or tax payer or student or patient) is deserving of the same level of consideration and respect as it demands back. If the organisation wants to scold you it will call you on a Sunday evening (you would drop a friend who did the same thing). If you want to complain about the intrusion a contemptuous organisation will tell you that you must write (on paper of all things) because there is no phone number available to a common customer like you.

Contempt is born of ignorance in those who think that they are above the customer and enjoy the feeling of temporary power

If you don't like the rules (which the person serving you didn't write he or she just "follows them") then you should just go elsewhere ("we have other customers you know").

Contempt is born of ignorance in those who think that they are above the customer and enjoy the feeling of temporary power. John Gottman, one of the leading expert in couple relationships, describes it as one of the "four lethal horsemen" of the relationship apocalypse (the others are criticism, defensiveness and stonewalling).

His research (in which he can successfully predict, 85 per cent of the time, whether a couple will still be together in 15 years after only 15 minutes of watching them describe how they met) indicates that contempt is a clear indicator of a current or future negative spiral that will end in relationship breakdown.

First comes the refusal to engage, then the eye rolling, then the relationship ends in silence.

In an interesting parallel, almost eight out of 10 customer relationships end without any discussion about why the customer is leaving. Moreover, organisations only bother to try and retain their customers in one in 10 instances once they have explained their decision to walk away.

This is not because they have made a careful analysis of the likelihood of keeping the customer against the cost of making the attempt. It is because they are either ignorant about how or even why to retain customers or have no interest in what anyone outside of the organisation feels or says about anything.

Contempt ruins all organisations, and particularly those that owe their initial success to customer focus. Listening and acting on the concerns of unhappy customers not only retains that individual but improves the organisation as a whole.

Once a UK retail powerhouse, Marks & Spencer (M&S) doomed itself to decades of misery because it grew to be contemptuous. It didn't have a marketing department until 1998 (the year that profits and sales dropped). It spent a pittance communicating with its customers (4.7 million against 27.5 million for Tesco). It couldn't be bothered building out of town shopping centres and until the late 1990s, wouldn't even accept credit cards. For M&S the focus became doing what was convenient for M&S since its own needs were so much more important than those of its customer.

People who went to work in the luxurious surroundings of its head office in Baker Street, London, were clearly (in their own heads) more worthy of consideration than those who bought their over-priced, under-whelming underwear. Anyone who wasn't happy merited even less time and attention. It wasn't really complacency but contempt that made executives forget the market stall foundations "don't ask the price, it's a penny" upon which the M&S empire had been built.

Stuart Rose, the firm's current CEO doesn't seem to be much more humble, disrespectfully preventing Philip Green (billionaire entrepreneur, turn-around artist, and owner of BHS) from even seeing the accounts and expensively discarding staff (such as Vittorio Radice, who saved Selfridges but was unable to work in the M&S culture of complacency).

Meanwhile while M&S profits fell by 19 per cent last year, boardroom salaries more than doubled to 9.7million. Mr Rose received a sizable 2.2 million signing-on fee and a salary of 850,000, although he failed to qualify for any bonus payments under his performance-based contract.

It may have been this failure to gain a bonus by making a profit that has inspired him to implement a similar scheme for the rest of the 400 most senior members of the team. It seems to say that, "we pay you lots but we know it's not quite enough to make you do your best work, so here's a carrot".

Meanwhile the rest of M&S employees will have to dig deep to motivate themselves to put in some effort for one hundred times less (about 8,500).

Contempt. Relationship rusting. Democracy damaging. Corporation corroding. Let it not end in silence and tears.

Contempt has torn value away from Michelin shareholders (share price down 3 per cent already), left fans and advertisers furious, and potentially lethally wounded F1's American dream. The reaction has been breathtakingly swift and entirely predictable.

Only humility and appreciation will save the day but don't expect the contemptuous to act on that advice in a hurry.

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About The Author

Max McKeown
Max McKeown

Max McKeown works as a strategic adviser for four of the five most admired companies in the world. He is a well-known speaker on subjects including innovation and competitive advantage. His latest book, #NOW: The Surprising Truth About the Power of Now, was published in July 2016.