Profit Bandits

October 1, 2015
Featured image for “Profit Bandits”

Every company has its own style and approach to business – some are just more successful than others. In every industry certain companies retain competitive advantage for good reason.

On the other side of the coin, then there are organizations with Profit Bandits!

Profit Bandits are business practices and management approaches that negatively impact cultural growth and subsequently, customer purchases. Often, when left unfixed, Profit Bandits directly affect an organization’s bottom line.

Consider companies that have compromised customer loyalty, such as the recent Volkswagen AG emissions debacle. The perception you have of that company is likely different than your attitude toward Apple or Google, which can be viewed as high profile examples of doing it right. Company culture and customer loyalty are the real drivers of profit. Profit Bandits get in the way. In this blog we’ll delve into different facets of a Profit Bandit – leadership, company culture, and client perception – and how you can overcome them.


After surveying employees, customers, and performance metrics, facts illuminate the challenges. Managers generally fall into three groups: facilitating, activity-based, and a small percentage which is toxic. This general categorization carries across all sizes and complexities of private or public companies.

Managers bring all kinds of behaviors and communication styles to work every day.

Some are facilitating managers — transforming and inspiring subordinates to follow the values and achievement expectations.
Some are activity-based managers — greater emphasis on achieving activities rather than the objectives and mission.
A few toxic managers exist — operating like a ball and chain to the enterprise. Dark little viruses contaminating the workplace.

We take our best soldiers and promote them into leadership positions and expect them to do well.

Excuse me, did I say leadership? Yes! Management is leadership. Leadership influences culture. Culture influences customer relationships. So even low-level managers are providing leadership to subordinates (likely those who are client facing). Even managers without direct customer contact are influencing the customer experience.

This is why the notion of Profit Bandits is so applicable even to leadership.

Young or newly-promoted managers may have challenges or legacy behaviors. Typically it begins with a lack of management training, clear expectations, or accountability.

Tip: Quality training elevates most managers into more effective leaders.

Facilitating Managers are what we strive for. With training, managers become more skilled at facilitating and achieving objectives. Performance metrics and accountability help ensure behaviors do not revert back to the original position.

Company Culture

Culture is “the shared beliefs and values of the company.” When you really think about it, company culture is a word encapsulating everything meaningful about the business. It’s the aggregate of the good, bad, and ugly.

Owners and senior management tend to view company culture with rose colored glasses. Because they believe it to be so, it must be true. Employees and customers have a different perception.

Company culture and perception go hand in hand. Perception is “an attitude or understanding based on what is observed or thought.” Perception is reality. But to understand that perception, you must see it from all sides (not just with the roses).

Tip: A stark view of management perception can be found through initiating Employee 360 Assessments. The cold hard facts gleaned from a well crafted assessment are the first step in modifying culture.

As part of our services, we conduct a substantial number of organizational assessments. Believe it or not, unequal employee accountability and poor management planning are the most often cited sources of negative company perception. All are consequences of the Profit Bandits.

Customer Perception

Metric-driven customers are very much aware of the benefits of doing business with quality suppliers and service providers. They are measuring hard costs in doing business with suppliers. They are measuring risk and profitability.

Companies with cultural challenges unload their products or services at the customer warehouse door like everyone else. The difference is they usually include a few cases of dysfunction and grief. Dysfunction and grief is labeled as poor quality, communication, and service. It comes with all kinds of consequences. Quality customers have it figured out. They choose to limit their exposure.

These Profit Bandits impact customer retention, sales revenue, and customer loyalty. They are a result of activity-based management. Effective leadership simply does not condone or accept the “Bandit” mentality.

Tip: Talk with your customers, query them to determine their perception. The majority will be honest. Find the issues, and fix them, before they go to your competition.

For example, we frequently assist with 360 Customer Surveys, which identify challenges to customer loyalty.

Identify Your Profit Bandits

Profit bandits come in all shapes and personalities. They wear the disguise of symptoms and consequences. Consider company culture is really shaped by all management and employees rather than top leadership. We’re after the source rather than the symptom.

Our top-line recommendations.

360 Employee Assessments– create transparency about company culture. Well crafted assessments identify activity based management and leadership challenges. Employee perception translates into customer perception.

360 Customer Surveys– identifies challenges to customer loyalty. Unless your business is very unique, we need loyal customers who return frequently to purchase. Every obstacle to positive customer relationships should be identified and eliminated.

Employee Accountability– Managers and employees need specific job descriptions centered on achieving objectives rather than activities. Performance metrics based on objectives achieved should be supplied consistently and accurately to every employee.

Management Training– Effective training creates a single performance language supporting the culture. Quality training begins with top management and cascades downward. Top management must be committed to cultural improvement, positive customer perception, and equal accountability. Without solid commitment, all is for naught.

Top-to-Top Communication– Quality customers want and expect top-to-top communication from senior management. Senior management who is customer centric experiences less attrition and greater employee perception. They are better in tune with company silos, challenges, and innovation.

Final Thoughts

There are two questions key management should be concerned about in the quest for competitive advantage:

What is the real financial liability of their profit bandits?
Is the company a commodity or innovator because of their culture?

These are tough questions CEOs and stakeholders must ask about their business.

Many times customers leave not because of price – rather it’s business practices. Customers are far more educated and critical about purchasing decisions. That includes the underlying costs of purchasing from challenged companies with “Profit Bandits” in place.

The same holds true for employees. Quality employees are far less tolerant of poor working environments and management behaviors. It’s not about compensation, it’s about team.

We encourage organizations to utilize tools like assessments to better understand company both from the outside-in (your customers’ perception) and the inside-out (your employees’ perception). Then your leadership team can understand the challenges the organization faces (re: Profit Bandits) and implement tools to combat it. This is where advanced training and organizational change come into play. What are your Profit Bandits?

About Us

Tacticware Resource Group is a management consultant. We offer management, HR, marketing, and sales training as well as 360 assessments and surveys. Tacticware is a member of the Society for Human Resource Management and subscribers to their code of ethics.