Behavior has been a potent differentiator for such industry‐leading companies as Ritz‐Carlton, Marshall Field’s, Nordstrom, Southwest Airlines, SAS, Xilinx, Volvo Cars, and Harley‐Davidson. Beyond customer service, however, many companies fail to consider behavior an element of their business strategy. Behavioral differentiation (BD) is particularly important when a company’s competitors offer essentially the same products and services at similar prices. A company’s behaviors can differentiate both positively and negatively, but negative differentiators have about five times the impact of positive differentiators. Consequently, companies should manage their behavior toward customers at every point where customers interact with anyone in the company. Companies can behaviorally differentiate themselves in four ways. (1) Operational BD occurs when they make exceptional customer treatment part of the way they normally do business. Operationalizing the behaviors customers experience as significantly positive enables companies to create systematic and sustained competitive advantage. (2) Interpersonal BD cannot be systematized because it depends on each employee’s emotional intelligence and interpersonal skill. However, companies can hire for high emotional intelligence, can set expectations about how customers are greeted and treated, and can ensure that their most interpersonally adept employees are assigned to important, high‐frequency customer touchpoints. (3) Exceptional BD occurs when companies allow employees to “break the rules” and do exceptional things for customers in need of exceptional treatment. Beyond creating the conditions that permit exceptional BD, companies should make heroes of employees whose exceptional behavior has surprised and delighted customers. Finally, (4) symbolic BD occurs when companies walk the talk, when their behavior reflects their mission, mottos, and other messages. Few companies are as accomplished at this than Harley‐Davidson. You are on stage with your customers all the time, and they are constantly comparing you and your behavior to your competitors and their behaviors, and you are how you behave.
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