Customer-centricity is too costly and disruptiveby
Attempts to become customer-centric are flawed because they demand that the organisation is radically overhauled, involving great cost and disruption. So is there a more pragmatic way to better satisfy your customer wants and needs?
Are you satisfying the needs of your customers to a remarkable degree?
Many survey results refer to the current poor state of the customer experience, often based on the lofty ambitions of placing customers at the centre of each organisation. In the real-world, organisations continue to serve customers, produce profits and grow, even if they are not ‘customer-centred’.
That being the case, they must - at least to some extent - already be doing something right, otherwise they would go broke. Is there is a way they can move forward and create better customer experiences, without throwing the baby out with the bath water?
Let’s start with the importance of knowing what customers need and want:
- Simply asking customers about their needs isn’t enough.
- Look beyond the headline metrics and simple surveys that your company may overly rely on to determine your performance.
- There are often largely neglected and underused sources of customer feedback that contain valuable and actionable information.
- Leaders need to fully digest the millions of words shared by customers and explore the patterns present to respond to (and importantly) anticipate their needs and wants.
There are powerful ways of finding out, with absolute clarity, about your customers’ needs and wants, how well your teams are delivering them, and how they need to continue (or improve):
- It’s about feedback informed by emotion.
- Capture knowledge about what Basic Customer Needs are and highlight those Customer Needs that will have the largest impact for an organisation.
- Understand the real experience behind the mass of data and %s – what is (or would) drive satisfaction with the experience?
- How can frontline teams deliver the basics that customers need?
- Fully digest the millions of words routinely shared by customers and turn this largely neglected and underused source of data into valuable and actionable information.
- Understand what drives success and importantly where specifically to focus your resources to enable and grow your business.
- Gain valuable insight to enable better decisions about strategic direction.
But you also need to change the underlying premise under which you are operating. The days of customer-centricity are gone. Leaders need to think about delivering a better customer experience through a ‘customer-enabled’ organisation.
What is a customer-enabled organisation?
Let’s start with a definition (always useful):
A customer-enabled (CEO) organisation is an organisation that actively seeks permission from its customers to engage in a value exchange, where both parties feel that the experience was positive.
Before we go further, just a thought about ‘value exchange.’
In the rush to worship at the altar of customer-centricity, it is often forgotten that for most organisations, the customer is a way to meet the organisation’s own goals, whether they be altruist or to deliver profit to shareholders. John Lewis in the UK, an exemplar of customer service, was not set up by its founder Speden Lewis for the benefits of its customers, but rather for the partners who co-own it. The customer was important to deliver good and meaningful lives to the workers or Partners.
The concept of a ‘value exchange’, something that has mutual benefits, is an important part of CEO. Traditionally this is something that refers to consumers giving their data in exchange for something. It seems to me that whilst the principle is sound, it should not be limited to data. There are some definitions that focus on goods and services. Whilst this does not preclude an exchange of data, this is far more appropriate.
Why move from CX to CEO?
The main difference between CX and CEO is that CX assumes that your organisation is broken, and you need to go through significant change to put the customer at the centre. Whilst good in principle, the problem is it also most never gets implemented because:
- It costs too much.
- It takes too long - ROI is often outside the term of the current management team.
- It disrupts BAU, making the customer experience worse, certainly in the short-term.
CEO on the other hand assumes that the organisation basically works from the customer’s perspective and identifies areas of incremental improvements that enable the customer to keep choosing that organisation. In other words, they meet the customers’ needs and go further to create positive memorable experiences. This has the benefit of:
- Building on, not tearing down, the current operating model (lower cost).
- Being able to be delivered quickly, so the current management team can see the results.
- Incrementally improving BAU, rather than disrupting it. The customers only see continued improvement in their experience.
Examples of CX and CEO
Companies tend not to boast about their CX failures! How many organisations have implemented expensive CRM systems, as a solution to ‘put the customer at the centre of the organisation’, only to deliver increasing complexity for the customer and organisation alike, without realising any tangible benefit to either party?
However, there are many examples of delivering both reduced operating costs and improved customer engagement through implementing changes based on what customers need or want from an organisation. Such as a major retail chain increasing revenues by 5% in stores where they implemented a customer need based training programme for frontline staff; a travel company saving significant operating costs by taking out 80 seconds of script on all in-bound calls that added no value to the customer; and a financial services company that added an average 10 seconds per call through introducing an empathetic approach, that significantly improved engagement levels (and satisfaction scores).
So how do you move from CX to CEO?
One way to becoming a customer-enabled organisation is to deliver the things that the customer and the organisation only think about when they are not delivered. In other words, needs that aren’t met on both sides of the ‘value exchange’. That said, the experience on both sides must go beyond the basics and deliver, in each value exchange, things that both sides want.
This is a very simple concept: just discover what each value exchange needs, then deliver just a few Wants that go above and beyond the basic Needs. This is the simple path to becoming a customer-enabled organisation. Know about the handful of important things that make a difference to your customers and the organisation’s ‘value exchange’. If you don’t already do them well, take small incremental steps to improve. Iterate, test and then listen to feedback, internally and externally. Define the benefits within your set accounting periods so that organisations can really see and measure the benefit of CEO.
Some may say “Well that’s the same as being customer-centric and putting the customer at the centre of your organisation”. However, as I was reminded by a colleague the other day, the customer really does not care about being at the centre of your organisation. They are in fact at the centre of their own universe and today have the power and tools to enable whichever organisation they choose.
So rather than restarting and transform the whole business, customer-enabled organisations (CEOs) focus on incrementally meeting more Needs and just a few Wants. This has the advantage of being easier to do, by identifying failed Needs as well as new Wants. These might require an adjustment to process, training, information or the products and services that a business delivers, but rarely involves wholesale transformation. If done correctly, it is also possible to identify new needs that, if met early, will ensure you continue to be the first choice for your customer in an often-crowded market.
This subtle but important change to the way we think about delivering value exchange for us and our customers results in a practical, implementable and cost-effective approach to becoming a customer-enabled organisation (CEO).
What do you do next?
Elvin Turner's recent article outlines his view (from research) that organisations are very frustrated with their results, i.e. 94% of leaders are unsatisfied with their results. He also outlines that executives resist radical change because it is risky, and tend to "date" it (casual, not too serious, etc.). Finally, he talks about how successful organisations strike a balance between radical and incremental change/innovation, and then goes on to talk about three key issues that if overcome, would ensure success: "I'm too busy to innovate", "overcoming risk aversion" and "evolving a certainty-driven culture".
Why am I telling you this?
Organisations trying to put the customer at the centre, especially if you accept that this is not what customers actually want, overcomplicates the strategies that companies embark on. It overlooks some simple, easy(er) to address needs, that would give customers a reason to continue to engage or engage again and generate value for that company. As Elvin says: “Look for fast small innovations that will be do-able, show results and set the organisation on the path of superior performance”.
From a customer enablement perspective, that means figure out what your customers want (even small needs) and use that as the foundation to discover the future, one step at a time. In time, the breadth of understanding you will have of your customers’ needs will provide insight into emerging needs and, perhaps, unique offers for the future that competitors don't/won't offer.
The same three strategies in Elvin's article (experiment; lower the stakes; and build a certainty- driven culture) fit perfectly with what we advise our clients.
My recommendation is to stop trying (and failing) to be a customer-centric organisation, with all the attendant disruption, cost and failed customer promises. Instead, take the lead and become a customer-enabled organisation (CEO).
As a Fellow of the Institute of Consulting & a Certified Customer Experience Professional (CCXP) Stephen's extensive work with commercial clients and with Central and Local Government has given him experience in a wide variety of industry sectors. Stephen has written 3 books about customers and employee engagement and is a regular speaker....