1. Heart to Heart The Importance of Employee Engagement in Delivering the Brand Promise to Customers November 28, 2006 Brian Carlin President Maritz Learning

2. Agenda Customer Experience – The Battle for the Hearts of Customers Employee Engagement – The Battle for the Hearts of Employees The Battle Plan – How to Engage Employees Famous Battles - Leading Edge Companies and Their Stories Preparing for Battle – Key Steps

3. Customer Experience

4. Customer Experience Facts The pain of poor customer experience (1) : –Nearly 50% of customers who defect, leave because of poor service –77% of customers who experience poor service blamed employee attitude –83% of customers who receive poor service tell at least one other person (1) 2006 Maritz: “The Power of Customer Experience” An important issue (3) : –96% of executives identified improving customer experience as “very important” (36%) or “critical” (60%) to their success –25% have named an executive in charge The reward of good customer experience (2) : –81% will continue buying from the company –74% are likely to recommend their favorite companies to others –50% said they would respond to “specials” (2) 2006 Accenture: “Seller Beware: The Curse of the Disloyal Customer” (3) 2005 Forrester Research: “The Customer Experience Value Chain”

5. The Importance of Employee Engagement The battle for the hearts and minds of your customers … … will be won or lost in the battle for the hearts and minds of your employees.

6. The Pyramid of Employee Engagement

7. Employee Engagement Defined Engaged employees … –Generally feel a strong emotional bond to the organization that employs them –Demonstrate a willingness to recommend the organization to others –Commit time and effort to help the organization succeed –Are typically motivated by intrinsic factors (e.g. personal growth, working to a common purpose, being part of a larger process) as well as extrinsic factors (e.g. pay/reward)

8. Employee Engagement Obstacles Empty Suits Leadership does not connect with employees emotionally The Isolation Effect Employees don’t see how they fit in the big picture Mandates from the Mountaintop Traditional, top-down structures irrelevant Motivation Is Neglected Over-dependence on training and communications The Silo Effect Lack of integration among disparate customer-facing functions

9. Employee Engagement Model

10. Lexus Taste of Luxury A new conversation about the customer experience Create an immersive and engaging experience Challenge dealers to “think different” Address “hearts and minds” Learn from some of the world’s greatest luxury brands Inspire dealers to take a leadership role The Challenge

11. Lexus Taste of Luxury Our Core Values

12. Lexus Taste of Luxury Learning From Our Customers

13. Lexus Taste of Luxury Benchmarking Great Brands

14. Lexus Taste of Luxury Engaging Associates

15. Lexus Taste of Luxury Translating Ideas into Action

16. Lexus Taste of Luxury The Result “Outstanding. It's one thing to learn and be taught something. It's another to experience it. This was by far one of the most impressive maneuvers that Lexus could have done to take us to the Next Level of Customer and Associate Engagement.” - Lexus Dealer

17. Lexus Taste of Luxury The Result “This is very helpful as we continue to help Lexus move to the top of the Luxury World. The program was excellent. I would be willing to spend $5,000 per manager to send our managers to this program... It will have more impact than any advertising we do.” - Lexus Dealer

18. Revitalize Barclays brand and engage staff in delivering on the new brand promise Support the launch of the new brand –New advertising campaign –Revamped High Street branches –New brand promise “We will always help you make it happen.” Articulate the brand strategy, making it relevant to 43,000 members of the organization Sustain the required cultural and behavioral changes over time The Challenge

19. Customer research identified key dimensions of desirable, enabling brand personality, i.e. “Barclays DNA” Four-phase “BIG” program approach –Design and focus: gained executive buy-in, created compelling vision, developed rigorous rollout plan –Priming (“BIG Idea”): launched program to 1,000 senior managers, who then cascaded key messages to 5,000 mid-level managers –Leadership alignment (“BIG Step”): 360’s, manager 1-on-1’s, self- development workshops on leadership qualities and style in the new organization –“Living the Brand” (“BIG Day”): one-day brand experience aimed at 43,000 staff in retail branches, call centers, and back office facilitated by Barclays Champions (trained by Maritz) Achievers recognition program to promote and sustain behavioral changes The Solution

20. Over 200 champions inspired and trained to disseminate the BIG messages Local action plans in place to ‘release the power’ in everyone HQ/branch priorities and channels clarified to ensure focus on the customer Current accounts up significantly after one year (000,000’s) Products per customer increased from 2.5 to 4.3 Employee surveys show overall improvements in levels of commitment, views on senior management and belief in Barclays products “The impact on employee performance has been dramatic and sustained. Over 18 months on, employees are still aligned to the values and behaviors that were initially communicated through the BIG experience.” - Malcolm Hewitt, COO, Personal Financial Services, Barclays The Results

21. Touching Lives, Improving Lives Improve innovation of 7,000 person R&D organization Series of residential colleges designed by Maritz Targets front-line scientists, researchers, senior executives The Challenge

22. Touching Lives, Improving Lives

23. This is Our Country The Challenge

24. This Is Our Country The Program

25. Key Steps Gain awareness Define desired customer experience Co-create purpose, values and behaviors with employees Align employees to new vision Utilize employees as source of innovation Establish ongoing reinforcement program –Communications campaign –Create a coaching culture –Peer Forums –Measurement