Unigate Dairies Ltd is a leading processor and distributor of fresh milk in southern England and South Wales. Accustomed to “living on success,” the company’s top management saw no need to dramatically change business practices. However, with industry deregulation, coupled with many of their traditional and potential customers preferring supermarkets, Unigate saw its doorstep customers—as they are called in the UK—begin to decline. This decline accelerated over the next five years, which equated to several hundred customers lost per working day. Because the company also supplied the supermarkets, Unigate’s overall sales remained fairly steady, but supermarket sales were, for obvious reasons, less profitable than direct doorstep business.

The company managed the decline in doorstep activity through rationalization and cost-cutting activity, but they recognized that a different approach was required. Senior executives called in Morgan Pierse, head of Blanchard^® International in Ireland, to work with the executive team to design and implement a major change initiative that would tackle the problem of declining doorstep customers.

Issues

Unigate had benefited from Blanchard programs in the past, and the company’s current problems made the executive board especially receptive to a service program. In fact, as Pierse recalls, they were too receptive. “They were looking for a service program ... it was quite easy to sell to them.” But, when he made his first presentation to senior management, Pierse discovered two critically important things.

• Unigate believed itself to be in “the milk business,” and
• Every member of the executive board thought that the milk business was “in decline.”

Those were the beliefs. The facts were different. Pierse pointed out that Unigate was in the convenience business selling service, not milk. And, in terms of overall sales, the dairy business was not shrinking, it was growing.

When the presentation was over, Unigate management told Pierse, “We want to buy.” His response was a stunning: “I’m not selling.” He knew that no service program, no matter how good, could resolve Unigate Dairies’ problem without some preliminary work. First, top management had to demonstrate that managing the decline was insufficient and, second, that the company intended to be a long-term player in the doorstep marketplace.

From the top down, Unigate people had become “resigned to this business going into the ground some four or five years hence,” recalls Terry Mills, Unigate’s management development manager. In the meantime, management wanted Pierse to put a service plan into place that would stem the flow of doorstep customers. This, they hoped, would at least ensure the company’s immediate future.

“[You are] asking me to do the impossible,” Pierse told Unigate management. Winning back customers requires accurately understanding why they left in the first place. To accomplish this, Pierse asked senior executives a series of questions that would help define their focus.

• What were their customers telling them?
• What product were they really buying?
• What was Unigate providing?
• How did it meet their customers’ needs?
• What was Unigate, as a company, all about?
• What did it provide its customers?
• What were its values?

Armed with the answers, Pierse explained to the senior executives that of the three basic steps in the Blanchard Raving Fans process (decide, discover, and deliver,) Unigate had demonstrated an ability to accomplish only the third step. He advised management to begin by deciding what the company’s real business was and discovering what their customers really wanted.

Process/Solutions

It took the board several months to develop a value statement. Once they had, they began to understand that what Unigate needed was an internally driven culture change, not an externally imposed training program.

When senior executives asked Pierse to return, they committed themselves and the company to a new set of aspirations. They were ready to embrace the Raving Fans philosophy, from the inside out. They set “creating legendary service” as their new goal. Most importantly, they understood that this commitment to service applied as fully to those inside the company as to those outside of it.

Blanchard helped Unigate implement the Raving Fans program (customized as Legendary Service) in ongoing, structured stages. After piloting the materials with a small group of managers, Blanchard began holding workshops for management teams throughout the company. Service is a line issue. So, too, is the basic Raving Fans message—decide, discover, and deliver. Therefore, at each workshop, volunteers are recruited to train as facilitators. These individuals then carry the message, spreading the Legendary Service program down the line.

This approach is especially important at Unigate, where management turnover is extremely low. These very loyal employees included some that felt this change initiative would not make a difference and clearly needed convincing. Terry Mills explains that the Legendary Service process offers a way to “win over the cynics” in the company. The value statement, for example, combines an emphasis on intent or aspiration with a recognition of hard economic reality. Unigate can’t afford to lower its price for milk, and it is already the acknowledged market leader in quality. Only by increasing service can it hope to increase profitability. Getting that message from a colleague who really means it is proving much more powerful than hearing it from a consultant. “It’s the facilitators,” Mills says, “who have turned the company around.”

Lessons/Outcomes

Unigate’s experience with Legendary Service has taught the company many lessons and they are now reaping the benefits.

• Discovering that their business is a home-delivery service has spurred Unigate to reposition itself in the community and has given it the confidence to win back customers.
• Training managers as facilitators and giving them a message that they understand and believe in has boosted these employees’ personal development and enhanced their management skills.
• Holding workshops for a functional mix of personnel has sealed the success of the program. Shared understandings create empathy and set the stage for cross-company communication.
• Focusing on small improvements (1% Clubs) has put success within the reach of every employee.
• Coaching managers by telephone, an innovative program that uses outside consultants to assist with Back-at-Work Plans, has helped reaffirm service as Unigate’s key goal.

But perhaps the most dramatic effect of the Legendary Service program is the change in Unigate’s corporate culture. The old “budgeting for decline” mentality has been replaced with a new sense of confidence. With Unigate’s parent company now eager to invest in the dairies’ future, there are plans to expand. Legendary Service is no longer thought of as a training and development initiative. It is now recognized as a major driver in the company’s commercial success.