Rory Sutherland

Now, as Roger L. Martin, your fellow Canadian and my own personal Svengali says, any idiot can cut costs, okay?

What takes real skill is cutting costs in a way that doesn't destroy value.

One of the things that I don't think is understood by tech nerds

and if I'm being really cruel, males in general in many cases, is the extent to which in evaluating any business or experience, the human component of it, the face-to-face component, does really, really heavy lifting.

I've got a lovely story to illustrate this, which I think is fantastic.

It's the absolute perfect example of misalignment of optimization through quantification bias.

So wonderful man, Alex Batchelor, used to be the marketing director of Royal Mail, similar to what you have with Canada Post, USPS.

Sorry, not USPS.

Yes, it's USPS.

And they couldn't make any sense of the fact that the brand perception of Royal Mail bore no relation to service levels.

So there would be districts and areas where, you know, every single first-class letter arrived early the following day, extraordinarily reliable levels of service, and Royal Mail wasn't particularly held in affection or esteem.

There are other areas where the service was frankly a bit ropey and people seemed to love it.

Now, this obviously upset them because they thought that all the billions or certainly hundreds of millions they'd invested in service quality improvement should translate into customer satisfaction and therefore, you know, some sort of brand voltage.

And someone had a theory and they said, I think something else is going on.

And the theory, which was put to the test and proved absolutely right, was that the major determinant of whether you liked royal male or not was whether you liked your postman or postie, technically, to be used the gender neutral term.

So people who had a rather unreliable service, but the postman did the odd favor for them, left things in the porch, had a chat with them, those people thought it was a brilliant organization, regardless of the actual metrics that were being pursued.

And I think that's very true in any service organization.

There's an electricity company, a gas company, a water company, a utility.

You may interact with them online 95% of the time, but the one or two occasions where you interact by telephone or face-to-face disproportionately affect your perception of the organization.

And I've argued for quite a time, if I were being completely honest, I've worked in advertising for 36 years, and if I were a wholly honest person without fear of annoying my colleagues,