Underpromise but overdeliver

You may recall a few weeks before iconic Apple co-founder and CEO Steve Jobs died in 2011, the giant tech company’s stock dropped a few percentage points. It wasn’t Jobs’ death that brought the valuation down as it was already factored into the stock market years ago when news of his sickness first surfaced. The stock dropped because the market expected something and didn’t get it.

In essence, Apple didn’t deliver on its promise. Each year Apple holds a conference. Every event is exciting because of new product announcements, usually revealed during the CEO’s presentation, which before his death, was always handled by Jobs. The speculation then was the expectation of the announcement of the iPhone 5. Instead of the iPhone 5, Apple’s raving fans received news on the iPhone 4s, an upgrade to the phone already on the market. The industry was less than impressed with this and thus Apple’s stock was sold.

One of my golden rules in consultancy work is to underpromise and overdeliver, NOT overpromise and underdeliver. Underpromise and overdeliver is the mantra everyone should live by. On the other hand, overpromise and underdeliver is a culture we should avoid. To illustrate this, let’s say a writer confidently tells his editor: “I’ll get my article ready in two hours.” Two hours later, he’s still struggling with the opening paragraph. His editor pops over to check on things and finds to his utter horror the writer’s still figuring out how to even start his article. Well, I won’t blame the editor if he were to lose his cool.

Promises date back to time immemorial. They represent a complex social norm and when we break them, the consequences can be disastrous. In the above example, the writer has made an ambitious promise but failed to live up to it. In other words, he has overpromised – which is to get the article ready in two hours – but ended up underdelivering. Had the writer promised his editor he could get his article ready in two hours and surprised him by getting it ready in under an hour, he would have exceeded his editor’s expectations. This is the essence of underpromising and overdelivering – you set the expectations or bar low and then exceed it.

Managing customers’ expectations is a key concern of most, if not all, businesses. When customers pay you for something and they don’t get what they expect, that’s when they reach for the refund button. We all know how important it is to understand customers’ expectations, but the sad part is many don’t know how to manage those expectations and deliver.

The art of understanding the customers’ expectations and then underpromising and overdelivering is no rocket science – it’s simple and effective. Let’s say, it’s Monday morning and a customer presents you with a requirement – he wants it completed by Friday and believe the cost should be RM1,000. You quickly assess his requirement and believe it’ll take 15 hours of work and will cost RM500. You don’t promise the customer it’ll be completed on Wednesday and will cost RM500. You prepare a proposal or job sheet with a detailed scope and tell the customer you’ll deliver on Friday and the cost will not be more than RM1,000. What you’ve done is simple – you’ve committed to meeting the customer’s expectations and nothing more. The customer is pleased and signs off on the job sheet.

Customers will love you

On Wednesday, you call the customer and notify him his request has been completed and you’re ready to deliver, and the cost is just RM500. Bravo! You’ve just successfully managed the customer’s expectations, exceeded those expectations and have therefore underpromised and overdelivered. If you do this often enough, I believe all your customers will fall in love with you. As customers ourselves, we love to be treated that way too, right?

Expectations are largely based on what has come before. Hence, it’s important for you to know what the accepted benchmarks and best practices are in your industry and how you can do better. Review how your competitors solve the problems your business solves, and find a better and more reliable – and of course cheaper – way to do it. In essence, you strive to exceed the bar and if you do it often enough, your credibility and that of your organisation will soar!

Just a word of caution though. Beware of danger – it’s not the overdelivering part that is dangerous. Overdelivering and wowing your customers is good business as it increases customers’ satisfaction, repeat business and word of mouth which all lead to referrals. It’s the underpromising part that could be deadly.

What do I mean by this? Let’s say you put a sign on the door of your deli proclaiming “we’ll brew your favourite coffee in less than an hour for just RM5.50”, thinking you’re underpromising to get the coffee ready in about an hour and then surprise your customers by overdelivering in just 10 minutes. No one is going to get excited about a weak promise. If your initial offer isn’t strong, then don’t expect to stand out from the crowd. Yes, exceeding customers’ expectations is awesome – it’s great for business. But to get a chance to overdeliver you must first excite them with your promise. And make sure it’s a jolly good one!

Staff interaction

Underpromising and overdelivering is equally vital for day-to-day staff interactions. If you as a manager promise your team a 10-day trip to the Caribbean if you hit your annual sales target, but then bring them to Phuket for a three-day holiday when the target is achieved, you’re in for trouble. If you still don’t get it, you’ve just messed it up by overpromising and underdelivering!

One of the major pitfalls of management is managing expectations of potential recruits. It’s natural to do everything you can to convert a potential candidate you’re interested in. However, mistakes made during recruitment and the subsequent onboarding stage can lead that person to leave early.

Recently, a friend left his job after three years with a family-owned company. He had spent four months looking for a job and deciding that one was the right fit as it came with 30% more pay and promise of another 25% increment upon confirmation, and a company car. During the interview, the company had represented itself as a market leader, growing quickly and had a great working environment. But after joining it, he found out it wasn’t. It was growing but slowly, and wasn’t even a major player in the industry but had only 5% market share.

His new boss was aloof and hardly mixed with the staff. Working conditions were bad and there was no culture of hanging out together. To add salt to his wound, he wasn’t given any increment upon confirmation and no company car was in sight! Four months later, he quit to return to his previous company.

So how did the company lose a talent it spent months recruiting? Its main mistake is all too common in today’s marketplace: overpromising and underdelivering. The company lost not only a talent, but also its credibility. So think twice before you promise!