The perfect form Featured

8:00pm EDT July 27, 2006
 The best advice Al Trujillo can give other CEOs is this — Don’t compare your company to the competition.

When Trujillo was named president and CEO of document management company Recall Corp. in 2002, customer surveys showed that Recall surpassed the competition and that customers were satisfied with the service they received.

“That gave us a certain amount of satisfaction and maybe too much comfort,” says Trujillo. “The real genius back then was when we decided not to ask our customers what our performance was relative to our competitors, or even what our performance was relative to their expectations, which is the definition of satisfaction.”

When customers were asked about their expectations, Trujillo was shocked to discover that they were extremely low, because no one in the industry was providing reliable, consistent and accurate service.

“You can be lulled into a false sense of security if customers’ expectations are, in fact, very low,” says Trujillo. “That means if you just do a little better than very low, you could still actually be quite poor, and yet your customers say they’re satisfied because you’ve basically met their expectations. That’s exactly where we were back in 2002.”

Trujillo decided that to accurately judge Recall’s performance, he needed to compare the company to a standard much higher than the competition or the expectations of customers, and that standard was perfection.

Trujillo had been with Recall, a subsidiary of Australia-based Brambles Corp., since 1997 and appreciated that it provided its services — the secure storage, organization, retrieval and destruction of documents — in a consistent way all over the world. But what wasn’t consistent was its commitment to service.

“We all kind of subscribed to the view that providing consistent, reliable and accurate service was an important characteristic, but we didn’t do it in a consistent way,” says Trujillo.

Outperforming the competition was no longer an acceptable goal, and from that point on, Trujillo would accept nothing less than perfection. A plan called the Perfect Order system was created to get everyone there.

Trujillo focuses on answering the questions what, how and why to drive commitment to the Perfect Order system. He uses these three elements to lead all of his 4,600 employees in 24 countries around the world.

“One is, you have to know what to do, so there’s a certain amount of planning and analysis that is required in any leadership role,” says Trujillo. “You have to be able to define what the objectives are and how you are going to achieve those objectives.”

To answer the first question — what — Trujillo needed to clearly explain Perfect Order so that there would be no confusion about what is perfect and what isn’t.

“We tried to quiet the opinions and fill them in with objectives, so it reduces any possibility of miscommunication,” says Trujillo. “We adopted a common language about how we would discuss and describe service delivery so that we were all talking the same language. I think that’s an important start. If you want someone to learn a different way, you have to all agree that you are going to communicate using the same set of definitions.”

From then on, all Recall employees knew that a perfect order was one that was on time, complete and secure. Now that there was a definition, Trujillo had to answer the second question — how. How would they determine if an order met those three components?

“We don’t think customer satisfaction or whether we provide good service should be defined as an opinion,” says Trujillo. “We believe it should be based on metrics — things that can be measured and improved upon. If you are a customer and you ask for 10 items and you want them delivered within two hours, we will measure ourselves against that standard objectively.

“Did we find all the items that you wanted? Did we deliver them to you and hand custody to you of those items? Did we do that within 120 minutes of you placing the order?”

If any of those conditions are not met, regardless of the reason, the order is imperfect. The company keeps a record of who was involved and the reason for the imperfection so that action can be taken to correct it.

Changing behaviors to decrease the number of imperfections was important to improving consistency of service, but it wasn’t easy. Whether it’s a veteran Recall employee or an employee gained through one of the company’s nearly 70 acquisitions in the past five years, Trujillo says the toughest part of changing the way something is done is answering the third question — why. It is essential to motivate employees to want to change, and that is something that many leaders overlook.

“I think that all individuals, regardless of culture or location, really want to understand the ‘why’ and what’s ultimately in it for them and why this is right for them to do and not just follow through on an edict,” says Trujillo.

All managers play a role in motivating employees at Recall. They stress the importance of improving their service through face-to-face conversations, video messages and in writing.

“The biggest challenge is to get into the hearts and minds of the organization, so they are clear that this is more than just following a new set of procedures,” says Trujillo. “It’s a different way of looking at service in terms of it being a commitment between Recall and its customers — one that’s based on facts, figures and metrics as opposed to an opinion that might be able to be swayed by a particular relationship.

“That’s the piece we work on. It’s the communication piece to make sure that they understand that while, from an activity point of view, it may seem very similar, there’s something behind the activities that they should subscribe to as well.”

Communication between employees and management has always been emphasized in Recall’s culture, and Trujillo says it is essential to being a good leader.

“You have to provide for the opportunity for feedback and open discussion about objectives,” says Trujillo. “We have institutionalized that at Recall since 1997 in what we call our recharge sessions.”

Twice a year, every Recall employee is entitled to two face-to-face sessions, where formal material such as financial performance, team member performance at a regional, country and global level and various other objectives are presented. By keeping the lines of communication open, Trujillo has kept his employees motivated, especially in their commitment to Perfect Order.

“We made Perfect Order and striving for the achievement of perfection a major theme of those recharge sessions,” says Trujillo. “I think that had a significant influence on the success of this program.”

By communicating with his employees, Trujillo found out that they really want to do a good job, and by measuring their performance, they could see if and by how much they’ve improved and how they compare to their peers.

“It appealed, in many cases, to their sense of pride in being able to deliver service at the highest level at the highest standards,” says Trujillo. “And that, I believe, was the magic ingredient in rolling out this program. ... It didn’t require a lot of carrot to motivate them. It really required the opportunity to give these team members around the world the opportunity to excel. And that opportunity to excel, I believe, is universal.”

And that is what has enabled the Perfect Order system to improve Recall’s global performance. When Trujillo first measured the company’s performance against perfection in 2002, it delivered perfect orders only 65 percent of the time. Now, that number is between 98.6 percent and 99.3 percent.

Today, the $600 million company is still the best in the industry, but Trujillo can now stake that claim with pride and proof. He says that it was not a hard transformation — it just took being a strong leader who is willing to openly communicate with his employees.

“From a leadership point of view, you can get the most out of people, the most out of an organization, the most out of a team, if you’ve got everybody understanding where you are going and then, hopefully, the majority of them subscribing,” says Trujillo. “It’s pretty simple stuff. I don’t think I’m inventing anything here, and there are probably a couple dozen books out there that tell you why this is logical. I can tell you from my experience that it has been.”

HOW TO REACH: Recall Corp., www.recall.com