In the words of Bill Hewlett: “Fundamentally, the HP Way is respect for the individual. If you give him a chance, the individual will do a lot more than you think he can. So you give him the freedom. Respect for the individual—not just employees, but customers and the works.

Once you have a workforce made up nearly exclusively of high performers, you can count on people to behave responsibly. Once you have developed a culture of candor, employees will watch out for one another and ensure their teammates’ actions are in line with the good of the company. Then you can begin to remove controls and give your staff more freedom. Great places to start are the lifting of your vacation, travel, and expense policies. These elements give people more control over their own lives and convey a loud message that you trust your employees to do what’s right. The trust you offer will in turn instill feelings of responsibility in your workforce, leading everyone in the company to have a greater sense of ownership.

Think of all the resources you devote to hiring good employees: interviews; background checks; references; tests for ability, motivation, and cultural fit. Now think of the energy you spend on "hiring" the right customers. In most companies, there's no comparison, even though customer behavior can have just as much of an operational impact as employee behavior. Customers can play a defining role in your ability to deliver great service at a sustainable cost. And the greater your expectations for your customer-operators, the more time you need to devote to choosing the right people for the job.

Here's one way to think about it: if you run a service business, then your customers "work" for you in many of the same ways that your employees do. But these aren't your average employees. They're erratic, unskilled, and entitled. Their interests and your interests regularly diverge. Employees are contractually bound to work on behalf of the firm, but customers operate under no such constraints. Customers are looking out for number one, as they have every right to do.

Think of all the resources you devote to hiring good employees: interviews; background checks; references; tests for ability, motivation, and cultural fit. Now think of the energy you spend on "hiring" the right customers. In most companies, there's no comparison, even though customer behavior can have just as much of an operational impact as employee behavior. Customers can play a defining role in your ability to deliver great service at a sustainable cost. And the greater your expectations for your customer-operators, the more time you need to devote to choosing the right people for the job.