Fast Company

Leader - Feargal Quinn

Ireland's "Pope of Customer Service" dominates his market -- and continues to beat bigger rivals -- with a leadership philosophy that is at once folksy and radical. Behind all his success is one big question: How do we convince our customers to come back?

Feargal Quinn is in no rush to get to the point. It's Monday, the only day of the week that he spends in the nondescript suite of offices on the outskirts of Dublin that constitutes the "support office" of Superquinn, the supermarket chain he founded 40 years ago. Quinn has leadership lessons to teach, but right now he has stories to tell.

Which is most welcome, because to hear a story told by Quinn, a compact Irishman with silver hair and dancing blue eyes, is to settle into the front row of a performance that has been given many times, but that still imparts valuable secrets.

"If you've got the chance to be born again," he says with a wink, "do your best to be born into a family that runs a holiday camp. It's a smashing way to grow up -- and a smashing business education." That's how Quinn grew up, of course. He spent school breaks at his father's Red Island holiday camp just outside Skerries on the coast of northern County Dublin, working as a waiter, page boy, bingo caller -- whatever the day called for. What he was really doing was soaking up insights and experiences that formed the core of a leadership philosophy that is at once folksy and radical.

The most vivid takeaway for the young Quinn was his father's policy of charging guests up front for their entire holiday. "It was set up so that no matter how hard we worked to give our guests a great experience, we wouldn't increase our profit from their stay," says Quinn. "The only way we could judge our success was if the guests came up to my father and said, 'Mr. Quinn, I had a great holiday. I'm rebooking for next year.' Every single thing we did was centered on one overriding aim: to get people to come back. I learned that if you look after getting repeat business, profit will largely take care of itself. When faced with any business decision, any call on your time or resources, you need to ask, What will this do to help bring the customer back?"

Quinn's tireless and inventive exploration of that question has earned him a reputation as Ireland's "pope of customer service." In 1960, he opened his first shop in Dundalk, when he was 23. Today, he is the executive chairman of a 5,600-person, 19-store chain of supermarkets (estimated annual sales: $700 million). For Superquinn's relatively tiny size (its fiercest competitor, the British chain Tesco, has $30 billion in annual revenue), its brand, impact, and ambition are remarkable.

Over the years, Superquinn has worked with exclusive suppliers to create a range of "destination products" dear to Irish palates, including a custom-designed potato and made-to-order sausages. Superquinn is piloting some of the world's most advanced retail technology, including self-scan shopping, multifunction kiosks, digital shelf labels, and mobile checkout technology. Superquinn's most celebrated features are its lowest-tech innovations -- from professionally staffed child-care centers to complimentary umbrellas at the door. Superquinn inspires such intense devotion that many customers say that they drive out of their way -- and past several of its bigger competitors -- to shop there. That translates into market leadership for the privately owned company in its greater-Dublin base, and 9% of Ireland's $11 billion grocery business. (Quinn, his wife, and their five children control 95% of the company's assets.)

Feargal Quinn is not just the face of Superquinn; he's something of an institution in Ireland. He is at least as well known for his 10-year stint as chairman of Ireland's national postal service (1979 - 1989), during which he led the transformation of a money-losing government institution into an innovative, profit-making semi - state enterprise. In 1993, he was elected as an independent member of the Seanad Eireann, the upper house of the Irish parliament. Still, more often than not, Quinn can be found in one of his 19 stores, bagging groceries, talking to customers, checking in with employees, and straightening up displays.

Indeed, for Quinn, customer-service innovation and public service demand the same defining trait: humility. Quinn likes to remind business leaders that they should make only five assumptions, which he calls his five lessons in humility: "My customers know more than I do. My employees know more than I do. Neither my employees nor I can be creative all of the time. What I knew yesterday is not enough for today. I'm not responding fast enough for my customer."

The Right Choice, Not the Easy Choice

The first thing that hits you when you walk into one of the 19 Superquinn stores in and around Dublin is the comforting aroma of baking bread. Big brick ovens, giant sacks of Irish flour, and bakers in caps complete the picture. Superquinn may be the only grocery chain in Europe with a full-fledged bakery in every store. Besides the enticing smell, the bakeries guarantee that customers never buy bread more than four hours old. And with twice-daily deliveries, fruits and vegetables are farm-stand fresh. Each batch of mushrooms, lettuce, and melons is marked with the time it was picked, a picture, and a biography of its grower.

But what really sets Superquinn apart is what's behind the dazzling products and the impeccable service. To shop at Superquinn is to feel understood, to see your questions and complaints addressed before you raise them. Why do you have to pay for the broccoli stalks and carrot tops you never use? At Superquinn, you don't. The store provides scissors at the display, so you can cut off what you don't want. Why can't you ever decipher your receipt? At Superquinn, the checkout technology provides a running tab on a screen that faces the customer, and then organizes the final receipt by product category, rather than by the order in which products were scanned.

The Superquinn experience is not so much a product of high-concept design principles as it is the result of Quinn's first principle: In every deed, focus on persuading the customer to return. Quinn calls it the "boomerang principle." The challenge in building a business on the boomerang principle, he says, is that, in many cases, the option that brings the customer back isn't as quantifiable as the option that maximizes profit on the current transaction.

Take the standard industry practice of stocking candy at checkout counters, which causes a hassle for moms shopping with kids. "They kick up blue murder until the mother buys them something from the display of goodies," says Quinn. While Quinn had hard data spelling out the considerable revenue he would forgo, he had no accountant-friendly evidence on the benefits of removing the sweets. But clearly, removing the displays presented an opportunity to generate repeat business from grateful mothers. "This is where leadership comes in," he says. "It requires courage to take the unquantifiable option." Superquinn ultimately went with the customer-driven choice and banned sweets at checkouts across the entire chain -- to an immediate and overwhelmingly positive response.

In an even more dramatic appeal to maternal goodwill, Quinn and colleagues instituted the Superquinn Playhouse concept some 20 years ago. Today, every store features a professionally staffed playhouse where mothers can leave young children while they shop. The program costs Superquinn a bundle each year -- but it has earned even more in loyal customers and reputation. Kindergarten teachers around the country (Ireland doesn't have preschool) recognize "Superquinn kids" as the most socialized and school ready of each new class.

The Best Listener Wins

It's the explicit job of every Superquinn employee to cultivate a bone-deep feel for the customer. "If you believe you're in the business of serving the customer better," says Quinn, "then you have to move the center of gravity of the organization to where the business meets the customers." In Superquinn's case, that means the shop floor. Quinn did away with the company's "head office" years ago in favor of distributed support offices for management functions. Managers are expected to spend substantial time each week on the shop floor. Quinn himself spends most of his week shuttling among the 19 stores. He rarely goes two weeks without visiting each shop or attending regularly scheduled customer panels. Store managers have tiny, dingy offices at the back of their shop -- to remind them that their real work is on the floor. Most meetings among colleagues -- as well as those with suppliers, partners, and managers -- take place out on the shop floor.

When it comes to getting a feel for the customer, nothing beats "jumping the counter." Each month, Superquinn managers are required to spend time "in the customer's shoes" (shopping, asking questions, lodging complaints, waiting in line). "The difference between being a customer yourself and waiting on a customer is amazing," says Quinn. "What seems reasonable or even valuable from the perspective of the company is often glaringly wrong from the point of view of the customer."

In a business environment that is becoming more and more sophisticated about connecting with customers, the simplest approach is sometimes the most effective. For Quinn, that means listening. "Genuine listening ability is one of the few true forms of competitive advantage," he says. Superquinn's multichannel "listening system" includes regular customer panels, customer-comment forms, a service desk at the entrance of every store, and formal market research. In addition, every store invents its own channels. David Fox, manager of the brand-new store in the futuristic shopping center in Swords, personally calls the top 150 participants in Superquinn's loyalty program, SuperClub, every quarter.

Innovation Everywhere

Superquinn's listening system not only picks up ideas and insights from customers -- it also fuels innovation in the ranks. Every Superquinn colleague -- whether a regional manager or a produce department's champion of green vegetables -- has access to chainwide results every week, including the past week's sales, relative store performance, cost of labor, and year-to-year improvements. But the most important metric -- and the one that determines compensation and rewards -- is loyal households (that is, the number of returning members of a household, rather than the total number of customers that come through the door). The very visible challenge for each employee is to increase the number of loyal households in his or her piece of the business.

Just two guidelines matter when it comes to rank-and-file innovation. First, all innovations must be tested on the shop floor before seeking organizational approval. The second rule, says Quinn, is "you can add, but you can't subtract. Once the organization has accepted something as a practice -- such as the no-sweets-at-the-checkout policy -- you can't individually decide to change it. And some standards, including food-safety procedures, aren't up for discussion."

Superquinn's customer insights have attracted a variety of business partners that would normally gravitate toward the leverage of bigger players. The chain's Swords store, for example, is the world pilot site for National Cash Register Corp.'s cutting-edge retail technology. Superquinn's fresh produce, butchers, and fishmongers are mixed in with futuristic flat-screen displays, digital shelf labels, and kiosks that link customers to their bank, to their SuperClub account, as well as to wine recommendations and interactive recipe planners.

Quinn credits his listening systems for the company's status as a pioneer in food safety. More than five years ago, Superquinn developed the world's first meat trace-back program in a joint effort with a Trinity College startup, IdentiGEN. Since 1998, Superquinn has used the DNA-tracing technology to test more than 100,000 animals. In the midst of Europe's BSE (mad-cow disease) scare and its foot-and-mouth crisis, Superquinn's sales of beef have experienced double-digit increases.

Quinn has been equally bold in leading Superquinn into new business lines. Its newly launched online division boasts more than 26,000 registered customers and a booming wine-delivery service. Texaco has partnered with Superquinn to develop, source, and train staff for a chain of full-service convenience stores, called SuperQ, at filling stations around Dublin. Meanwhile, Superquinn has plans to open six new shopping centers and stores by 2005.

Spend any amount of time with Feargal Quinn, and you'll hear one mantra repeatedly: "I listened, I learned, I discovered." His humility when it comes to what he doesn't know -- and his humanity when it comes to thinking about the customer experience -- are the simple secrets of his success. What's more, Quinn genuinely delights in his customers -- and looks on them as individual people to be won over, not as statistics to be managed. "The real entrepreneur," he says, "is always spurred on by a wish to attract every customer -- by a childlike belief that you can win all the time, every time."

Polly LaBarre (plabarre@fastcompany.com) is a Fast Company senior editor based in New York. Contact Feargal Quinn by email (himself@feargalquinn.ie).

Sidebar: What's Fast

Feargal Quinn is a pioneering entrepreneur and a respected Irish senator who starts every interaction with employees or customers by talking about what he doesn't know. Here's what he does know.

Leaders are listeners. "If you expect to learn from your customers and employees, don't rely on market research or a suggestion box. Host customer panels, solicit complaints, step into your customer's shoes, plant your people at the front lines, and learn a dozen customer names a week. Listening is not an activity you can delegate -- no matter who you are."

Watch the time. "If anything matters to people today, it's time. We call these people 'CTT customers': can't cook, too tired, and have no time. The best service for these customers is invisible service: They want what they want, when they want it, how they want it. We've developed a variety of meal solutions for these customers and reduced the maximum wait in any checkout line to 60 seconds."

Make yourself available. "When I hear leaders talk about 'managing by walking around,' I think it's great that they're working on their visibility to employees. But I worry that they're forgetting how important it is to be visible and accessible to their customers. I recently had a meeting with the head of Coca-Cola Ireland where I have most of my meetings, which is right on the shop floor. We were standing in the soda section and were interrupted constantly by customers. Later, the Coke executive said he learned more in our short meeting than he had in the previous six months!"

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