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 Wisdom to Win
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James Heskett (1933- )James Heskett


Harvard Business School professor and expert on corporate culture and marketing strategy (pictured right).



Key booksJames Heskett

Corporate Culture and Performance (1992), written with John Kotter (pictured right)

A strong corporate culture (strongly shared values and beliefs within an organization) can significantly increase long-term profits, if it emphasizes the continual satisfaction of customers, employees and shareholders.

But effective visionary leadership is vital to overcome any resistance to change that arises particularly when organizations are:

  • successful.
  • inwardly focused.
  • arrogant.
  • overly bureaucratic.


Key quotes on corporate culture

Cultures can be very stable over time, but they are never static... New challenges can lead to the creation of new ways of doing things.

The single most visible factor that distinguishes major cultural changes that succeed from those that fail is competent leadership at the top


Key quote on the service profit chain

When employees...begin to interact with customers and their problems and needs, they often begin to value the interests of customers more highly.

 James Heskett

The Service-Profit Chain (1997), written with Earl Sasser (pictured right) and Leonard Schlesinger (pictured right below)

The “service profit chain” shows the link between employee satisfaction, customer satisfaction and profit and must be put into effect by an organization’s leaders and managers:

 James Schlesinger

Employee satisfaction leads to...


Employee retention leads to...


Customer (or external) service quality leads to..


Customer satisfaction leads to..


Customer retention leads to...




Employee satisfaction and retention are dependent on work’s “internal quality” (people’s feelings about their jobs, colleagues and organization).


Key questions are:


1. How do you measure employee productivity and employee satisfaction in terms of creating customer value?


2. Is quality of service to customers adequately measured and recognized?


3. Are customer needs incorporated to employee selection criteria and methods?


4. Are employees adequately rewarded for customer satisfaction?


5. Do employees know who their internal customers are?

(Internal customers are the employees they serve to eventually satisfy customers)


6. Do employees know who the organization’s customers are?


7. Are employees given adequate resources and support to deliver customer satisfaction?


8. How do you create both employee and customer loyalty?

(So employees can’t be complacent and resistant to change)


Key quote on customers

Customers don't buy products or services. They buy results.

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