Is Your Efficiency Killing Your Effectiveness?

The advent of the quality movement has morphed into efficiency spawned by cost-cutting.  However, to be efficient doesn’t mean you are being effective.

Customers want you to be efficient because costs get lower, but not at the expense of effectiveness.

Confused?

Efficiency needs to yield to effectivenessAs a service organization — or even as a manufacturer — you have products and services that make the life of your customer better, easier and/or more fun.  You could say your reason for existence is to  achieve this.  The actions of service organizations  seem to indicate a lack of understanding of this simple fact.

OK, still confused?

Let’s take the Interactive Voice Response (IVR) system that customers have to go through with service organizations.  You know, the push-button or voice activated greeting you get.  Customers hate them.  Rarely do you find a menu of options that makes any sense to a customer.  Frustration ensues.  Misroutes are notorious with an IVR system.

It doesn’t end there.  Customers often have to give their name, account number and other pertinent information to the IVR and when the service representative answers they ask the same questions.

If customers hate them so much, then why do service organizations use them?

Because they assume they make their organization efficient.  If any organization wants to make a customers life easier, better and/or more fun — they wouldn’t put in an IVR.

One other word about IVR and customers.  I did some internet research for a survey about how customers hate IVRs.  Most of these surveys are done by — you guessed it — the ones that sell IVRs. One blog promoted with delight that only 66% of customers hate them.  They found this encouraging.  I am not kidding.  Could you find  any other product with a 34% approval from customers that still exists?  Beside politics?

Service organizations happily keep buying these modern marvels despite there ineffectiveness.  Technology is treated  this way in general.  Say the word “technology” and people swoon over having to get one.  Then it becomes “just keeping up with the Joneses.”

There is a constant push to move customers to “more efficient” channels to conduct business.  This is done in the name of reducing costs.  IVRs are one category, and websites are another.  But something is lost.  The interaction between a customer and an organization becomes less intimate.  Building a strong bond does not come from CRM systems, it comes from relationships  through front-line workers.

In the end, effectiveness has to beat out efficiency.  Being effective means doing what increases the chance of doing what is important to customers.  The financial, mechanized approach won’t get you there.

Take a look at your organization as your customers see it – our 4-day workshop has been called “an awakening experience.” You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance. Tripp Babbitt is a service design architect and organizational futurist. His company helps service organizations understand future trends, culture and customer. The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness. Read his column at Quality Digest and his articles for PEX and CallCenterIQ. Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

 

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Do You Want New Customers?

Almost every for-profit organization wants more customers.  Who wouldn’t?  More revenue and profit — sure beats the alternative.

Let’s not talk about that.

Good service costs lessThe funny thing is that customers that you currently have sometimes get the shaft.  Look at the recent deal by Sprint that is not offered to existing customers.  Say what?

Ignoring existing customers doesn’t build customer trust.  This really   is a poor strategy.  Customers resent the “your important until you become a customer” mantra.  Customers that hate your service — leave.

Another industry that doesn’t seem to get it — are hospitals.  They are all about branding and having “world-class” doctors, but many don’t share data to prove they are “world-class.”

The reason they don’t is because they are not.

You have to wonder what the marketing spend would have to be if you actually did take care of customers.  Happy customers tell others and then they do business with you.  The service you provide creates the brand and not vice versa.

The mirage is a mirage when it comes to branding.

You get one good chance to keep a customer for life.  Don’t blow it.  Otherwise you will have to spend a ton on branding and marketing to convince the market you are something you are not.

Take a look at your organization as your customers see it – our 4-day workshop has been called “an awakening experience.” You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance. Tripp Babbitt is a service design architect and organizational futurist. His company helps service organizations understand future trends, culture and customer. The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness. Read his column at Quality Digest and his articles for PEX and CallCenterIQ. Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Do You Think Your Employees are the Problem? They’re Not — It’s You!

Blog Pictures 048Placing blame for organizational problems is what executives like to do.  If it isn’t unions or a poor education system, it has to be incompetent workers?  This doesn’t exonerate all workers, but 95% of them — yes!

Have you ever worked in the trenches?  We are not talking about when you were in high school or college, but today.  Since you got that executive position, you have been so busy planning and hitting the numbers that you have forgotten what the work is all about.

Customers are being represented by numbers rather than relationships.  That report tells you nothing about what is important to the customer.  Without a touchstone and principles to guide your path over-control and over-engineering reign supreme.

What is a good touchstone?

The Customer.

That’s the big “C” and not the little one.  Not the internal customer and other such non-sense, but the end customer.  The one that pays salaries and provides profit.

Make a customer happy and you stand a chance.  Bury your head in reports and internal drivel — watch for the downward spiral.

What about principles?

Executives embrace dictates — send me a report, project plan and data.  Make a decision and then follow-up with policies, rules, procedures and scripts.  Next, inspect and audit the worker into submission.

Then ask, ” Why are my workers not critical thinkers?”

Your work design seeks compliance — not thinking.  Check your brains at the door and pick them up on the way out!

Principles are something different.  Principles are guidelines developed to deliver what is important to the customer.  Customer-facing workers can think and deliver with principles.  Rules and scripts do not provide that leeway.

So, the next time a counterpart — because you are not the problem — wants to disparage a worker, tell ’em that we designed it that way.  Don’t blame them.

 

Take a look at your organization as your customers see it – our 4-day workshop has been called “an awakening experience.” You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance. Tripp Babbitt is a service design architect and organizational futurist. His company helps service organizations understand future trends, culture and customer. The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness. Read his column at Quality Digest and his articles for CallCenterIQ. Reach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

 

 

 

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The Real Core Competency to Drive Performance

Good service costs lessI still hear a lot about core competency and outsourcing what you are not competent at in your government and business.  There are certainly advantages and disadvantages to such thinking, but what is often missed is the end-to-end system.

Bill recently purchased a music mixer for his band .  Bill had not used a mixer before, but felt that he could learn from friends and YouTube videos.  He purchased a mixer from a distributor of the product manufacturer.  He had difficulty in following the instructions provided with the mixer for set up.  He went to get some help from the outsourced contact center and upon calling the contact center he discovered that they knew less than him.  In fact, Bill frustrated with the support returned the mixer believing there was something wrong with the unit.  He agreed to return the mixer for a replacement unit.  Bill enlisted the help of friends to follow the instructions and discovered that the instructions for set-up were incomplete, but the unit itself was fine.

I have listened to similar stories in every industry.  Product manufacturer outsources there service to a “competent” service provider.  Only to discover that they can pick up the phone and smile and run cool reports, but the ability provide knowledge and end-to-end service is lacking.

There are costs associated with the “core competency” thinking when it is rooted the functional separation of work.  Returns, lost sales (present and future) and the opportunity to help customers and get direct feedback on the end-to-end service.

The manufacturer and the service company have to work as one system because that is the way customers see it.  You lose business quickly with the power of social media when the manufacturer and the service provider blame each other.  Quite frankly, customers don’t care about the service provider contract and the blame game . . . they want their problems solved and to receive good service support for the products and services they buy.  If you can’t deliver end-to-end service you may find customers going elsewhere.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Gallup Survey: 70% of American Workers are Not Engaged or Actively Disengaged

Coercion by inspection and audits doesn't change thinkingA shocker? Not really. 70% of American workers are not engaged or are actively disengaged. Dreadful and depressing.  Unfortunately, Gallup has decided that worker assessments are the answer – it is not.  Not to say there isn’t interesting information to be learned about individual interests, just not very impactful to the business.

The real reason that workers are disengaged is because their work design is awful.  As a worker, you get told daily about what you should do and organizations have the processes, rules, scripts, performance appraisals, etc. to back it up.  Even the support areas get more respect than workers and even dictate their edicts to workers – after all, they are the smart ones . . . just ask them.

The survey also mentioned that “actively disengaged workers” are costing the US economy between $450 and $550 billion dollars a year.  No small sum and you will be adding to this sum if you turn to coaching the individual as the answer.

Design work that workers enjoy and embrace and the rest will take care of itself.  The individual is rarely the problem and represents only 5%, 95% of the problem is in your organizational design.  Design good work and engagement will be a problem of the past.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Back to Design Basics

I recently watched Peter Skillman (VP Designof HERE) discuss an experiment he conducted and the discoveries he made while doing it – listen below:

The kindergartners outperformed all the “smart” people in the experiment!  The lowest performing group . . . business students.

Telling.  Organizations have over-thought and over-designed just about everything – leading to complexity and waste by designing in  their own problems.

Over and over again I have found that the approach from management in service organizations is to get an idea, plan and roll-out to the organization via project management the implementation of the idea.  Long projects (Over 6 months) have requirements change because of the dynamic nature of service.  The project is typically obsolete before the implementation is finished.

Information technology companies selling software perpetuate and lock in the waste by “nailing down” requirements and writing contracts that impede or dismiss an iterative approach.  In fact, the whole software development process has created a barrier to changing requirements.

Those software companies that do iterative type of software development are still missing the work design issues that need to be dealt with before starting to code.  The business requirements are born from a poor work design and can only be seen when developers actually understand the work – not through written requirements, but through observation and iteratively improving the work.  This is a programmer-user activity with no intermediaries.

Few software companies address the work design itself and when they do it is usually a retrofitting activity.  Slam the software in and then make process improvements.  The operating assumption is that the design ONLY needs process improvement rather than redesign BEFORE any software is provisioned.  Monthly sales targets in a software organization wouldn’t allow such diligence and even if this didn’t exist most software organizations don’t have the knowledge to do a redesign (one of the reasons I offer a workshop and consulting in this area).

Service organizations would be better off to design/redesign services before pulling in IT companies.  When you have iteratively discovered a better design, then software may make sense.  Service organizations just like to do things backwards . . . an operating reality.

Regardless, there are better ways to go about improving service organizations than the large single-focused project.  We are better off being armed with knowledge and an “iterative” discovery process than the business school definition being used today.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

 

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Barclays: 2,000 More Layoffs for Decimation

Barclays  announced they plan to cut 12,000 workers and give out 10% more in bonuses for management  as reported in the USAToday article, Barclays cuts 12,000 jobs, ups bonuses 10%.

If Barclays had laid off another 2,000 employees they would have achieved the decimation that ancient Romans used to seek compliance.  You see, back in the days of the Roman empire when you had unrest, mutiny, disobedience, etc. in the Roman army you would kill every 10th man to restore order.

Barclays has committed an act that everyone knows deep down smells bad.  There is something not right about this practice that does not sit well in the gut of most people.  Besides the moral issues, the unrest is real.  If you read the comments section of the article you will find that people are calling to boycott Barclays and today the stock is tanking – but who knows what tomorrow will bring?

I have written much about the problems associated with ranking, Better Thinking: The Case Against Targets, Rewards, Incentives, Performance Appraisals and Ranking Workers and you can search this blog for more.

I believe an important question to pose to anyone doing layoffs to keep the most talented and rid themselves of the under performers is, ” Why did you hire the under performers in the first place?”  There is real cost associated with hiring poorly . . .especially 12,000 of them.

Another question I would have . . . would be, “Were they really good performers working in a bad organizational design?”  Here is where I find the biggest problem, the design of the work and system of management that has been put in place.

It is hard to blame the CEO – although many will.  The culture of many organizations is steeped in this Darwinian, “survival of the fittest” mentality.  The cost to both society and the organization are immeasurable, however, most CEOs have learned that getting to the top means leaving carnage strewn behind them is the path there.  It is they way of the world.

There is a better way.  Safer than the known way.

This means building a system where all people have dignity and worth.  Especially, those on the front line that can deliver what is important to customers without them there is no business.  Building a better system to work in can lead to not having to make cuts in the first place.

However, dire times require action.  It is hard to justify bonuses to the best while dumping 12,000 souls on society that at one time you found worthy to hire.  The loss is too great.  Just ask Enron who hired and kept the best.

Here is what I would suggest to organizations instead that would provide better leadership:

  • Forgo the bonuses and keep the employees.
  • If that is not enough, management should take a 10% cut.
  • If that is not enough, than a 10% across the board cut of salaries for all employees.

The above are actions to take for executives that want to lead from the front and not behind.  Otherwise, by default, society will view you as greedy and employees will view you as selfish.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

 

 

 

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Standardization: A View

Blog Pictures 092Allow me to give you a view on standardization.  As part of this view, I will give you my background which will give you some insight into why I see things this way.  Gone is the moniker of “Lean basher” or being part of a group that takes pleasure in being experts, but not very helpful.  I represent only myself and what I have learned.

I started my “organizational improvement” journey back in industrial distribution in the mid-80s. I was influenced by the work of W. Edwards Deming as his message was far different than what I had learned in my MBA program.  I made lots of mistakes (and still do) and continue to learn.  I do not believe there are experts when I consult, the true experts are those doing the work.  I can only offer what I have experienced and learned.

I’ve worked with just about every type of service organization and spent a large bulk of this time working with information technology companies.  Upon reflection of these years, most of the work was to standardize and improve processes as coding to a standard process is much easier than coding to large variation.

The more I saw standardization being written into business requirements the more I saw workers and service suffer.  Standardized menus to choose from call center workers that don’t reflect the actual demands.  In contact centers, I saw the most popular choice of call type being “miscellaneous” or “other” – worthless data that could help no one.

I also saw workers being forced to standardized processes, scripts, rules, procedures that did not fit the questions customers were asking.  This caused customers to call back or leave – you can measure the ones that call back, but it can be difficult to measure who left or gave up and will eventually leave.

I have also seen that as I worked with information technology customers’ that making a change to the software became an event.  Even small changes had to be vetted and prioritized while workers and customers waited.  Governance meetings were held and items would move up and down the list.  I knew there was something seriously wrong when a developer after a governance meeting stated, “I could have made that change in 5 minutes and we discussed it for two hours.”  The software development cycle (a form of standard work) to build software had become the inhibitor to enabling the work that mattered to workers (end users) and customers.  IT had lost its aim – to help users create value for customers.

Side note: Information technology companies have made it much harder than it used to be or needs to be.  The answer to budget and time overruns to IT projects was building more bureaucracy with BAs, Testers and PMs.  Most of the time the PMs are just asking the developers when they will be done or ticking some other box.  The truth is the only role that creates value is the developer.  The way software has been split into multiple specialists has created more complexity and waste.  Even small changes can take weeks and months.  All in the name of process.

Today, when I work with a client I don’t even talk about standardization.  I talk about a customer’s interactions and aims, and organizational perspectives, beliefs and assumptions.  The first two help you see what the customer sees and that last three help you understand why you designed the work that way.  I call it a Model to Unlearn as part of the 95 Method – it is explained in the 95 Method video.

During this exercise, I typically will find where standardization is driving in avoidable demand (demand that customers don’t want to have and service organizations don’t want).  If I was talking about 1 or 2% that might be OK, but when you see 25, 50 – 80% you know there is something seriously wrong. The root of the problem is not all standard work, but it is certainly its brothers and sisters . . . scripts, rules, procedures, etc.  All these things create barriers between front-line worker and customer.  And many were created by management and support areas without worker input.

Instead, what I find works best is smartening up workers.  Learn the end-to-end system and the beliefs and assumptions that went into it.  Armed with knowledge, understanding and wisdom . . . workers can decide how best to design the work.  This is not what I see happening under any moniker (lean, six sigma, TQM, continuous improvement, etc), instead we get the “smart” people from support areas and management to make standardized work to control the worker.  Adding additional waste by inspecting them, pressuring compliance and then rewarding or disciplining them – how fun a job is that?  The worker I mean.

The key to me is that I don’t even bring up standardized work until the worker says, “It would be nice to have something that helps me do this.”  It is natural and unprovoked by outside influence – you won’t have to reward, discipline, inspect or seek compliance because the worker understands the need.  The added benefit is increase morale.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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Service is a Box of Chocolates

You never know what you’re gonna get.

 

The standardization juggernaut continues to carve a deep path through service.  Improvement folks, IT, management, etc. continue to hitch their wagon to the standardization movement.  Complete with mind numbing audits and inspection to seek compliance.

It wouldn’t be so bad if the workers were “pulling” for standard work, but what I continue to see is folks not doing the work or even really have a clue about the work coming up with standard work and sending the audit police after the perpetrators.

However, this is only half the problem.  The other half is the problems you get if the processes look the same from location to location, but the demands are different.  Now you may be creating avoidable customer demands in the name of standardization.

Still another half (yes, I know I have used up my halves) say, “no kaizen without standard work” quoting Taiichi Ohno and the Toyota Production System (TPS) assuming manufacturing is the same as service . . . it is not.  Consider Forrest Gump and the box of chocolates, if the variety of demands is great or different by proximity forced standardization can create more problems (increased costs, lost customers, more mistakes, etc.).

Regardless, studying the effects of standardization before a massive roll-out is a good place to start.  Steps to standardization:

  1. Study customer interactions/demands and do this with workers that deal with customers/clients/patients/constituents.  Are they repeated over and over (like manufacturing)?  Probably not, but if they are then make sure the worker is asking for standard work – after all they have to use them.  Forced standardization will create zombie workers.
  2. Train on customer demands, not processes.  If workers are being trained, they need help to learn.  If 80-90% of the volume of demands are from just a few types of interactions then only train what they need to do them.  Leave out the IT system training, only train to what they need to handle what customers are asking for . . . the rest is waste.
  3. For the rest, customer-interacting workers are better to work to axiom and principles.  If you have a principle to “Do what is important to customers – that is reasonable.”  Workers will know what to do without having their minds checked at the door.  The workers engaged with customers have all the information needed and are in the best position to make a decision on what is best for the customer.  Once you restrict this with policies, rules and procedures or have to pass to managers you enter cost and waste.

 

Maybe I need a new slogan like:

“Friends don’t let friends standardize”

“When it absolutely, positively, has to be standardized let the workers do it.”

“A mind is a terrible thing to waste.  Don’t standardize.”

The tyranny of forced standardization without knowledge or worker input has to come to an end.  I hope it comes soon.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CallCenterIQReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt. 

 

 

 

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Beliefs and Assumptions – How Damaging?

 

All too often, I hear the use of statistics like the clip from Anchorman (above).  People don’t quote percentages too often, but they do say things similar to, “most of our customers like . . .” or “that happens . . . all the time.”  The problem is what follows.  I have witnessed multi-million dollar IT and management decisions based on nothing more than a claim.  I am often assured that the claim came from a “good source.”

I do not believe that organizations do enough to challenge the beliefs and assumptions where decisions are made.  The skeptics often succumb to the hierarchy – meaning if the source of the belief or assumption is up the chain of command it can’t be questioned.

It’s funny to me that people get challenged on things like their expenses, but not on operational decisions of much greater magnitude.  Some degree of due diligence would seem to be appropriate.

Conversely, it seems silly to me that those conducting a due diligence will quote ROI numbers for new lines or IT.  Then, proceed to roll-out a large project without even a small scale pilot.

You see all projects and decisions are based in assumptions and beliefs.  Some we pick up from other people, companies, articles, etc. and others from internal sources of “authority.”  Assumptions and beliefs make up our world as we know it.  We just need to be aware of what they are and test them against reality.  You never get a full answer, but you do gain knowledge when you test things first.

The question is, “What are the beliefs and assumptions that went into your last strategic plan, project plan or decision?”  You should have a list of what they were when you made the decision or even better make the list AS you deliberate the next plan or project.  Test it on a small scale and then make a decision.  This is scientific method.

Take a look at your organization as your customers see it –  our 4-day workshop has been called “an awakening experience.”  You will understand the customer view of your organization and take inventory of the assumptions, beliefs and perspectives that drive performance.  Tripp Babbitt is a service design architect and organizational futurist.  His company helps service organizations understand future trends, culture and customer.  The 95 Method designs organizations to improve the comprehensive customer experience while improving culture and management effectiveness.  Read his column at Quality Digest and his articles for CustomermanagementIQ.comReach him on Twitter at www.twitter.com/TriBabbitt or LinkedIn at www.linkedin.com/in/trippbabbitt.

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The 95 Method