Three ways to ensure your CX improvements outpace your competitors'
How can you develop and then maintain a pace of customer experience improvement that will outperform all competitors?
“The essence of strategy lies in creating tomorrow’s competitive advantages faster that competitors can mimic the ones you possess today.” Gary Hamel and C. K. Prahalad.
I regularly refer to this quote from Gary Hamel and C.K. Prahalad because I think it clearly explains one of the essential elements of a successful competitive strategy, which is the need for pace.
I guess the reason traffic authorities are using more and more of those average speed monitors is because they work better than anything else. Single speed cameras do have the effect of slowing traffic down at the point(s) they are installed, but drivers then speed up when they have passed them. However average speed monitors know what speed drivers are travelling at for the whole distance between two points, in other words their pace, and that creates the desired effect of slowing traffic down for the full distance.
It's the same with attempts to improve things, like service, in any business. You could choose to do it haphazardly, whenever and wherever it's felt necessary, like the odd speed camera. That will make a difference, at the time or point that it's done, but that's all. So just as with average speed monitors, if you want to make a worthwhile, lasting difference, and build sustainable customer loyalty and competitive advantage, what matters most is your overall speed or pace of improvement.
Pace of improvement is a crucial success factor in any competitive market. As long as your pace is greater than those you wish to beat, no matter where you start from, leading at the front or trailing at the back, having the greatest overall place will ensure you will either remain in or eventually take the lead. So if you want to be recognised as the service leader in your market, sector, town, or village, and create enduring customer loyalty, and competitive advantage, a key element of that success will be your pace of service improvement.
Professor John Kotter of Harvard Business School has a similar thought. He wrote the book Leading Change which is generally considered to be the best approach to implementing change in any organisation. In it he outlines an 8-stage approach to making any change plan effective and sustainable. The first stage in this approach is to ‘Create a Sense of Urgency’. In other words, to inject pace into the programme. He later discovered that this was the stage that most organisations, especially large ones, failed at. He therefore wrote a follow-up book entitled ‘A Sense of Urgency’, to emphasise the point that urgency (pace) is an essential element of success. Pace is therefore crucial for sustainable success.
This begs the question of how to develop and then maintain a pace of improvement that will outperform all competitors. I suggest there are three vital elements to consider if you want to do this: principles and beliefs; systems and processes; and tools and techniques.
Principles and beliefs
1. Everything can always be improved.
The first and key principle is that everything can always be improved.
The often-quoted adage “If it ain’t broke don’t fix it" is in my view an irresponsible assertion. The Japanese have the much more sensible approach, based on the word Kaizen, which means Good Change. Improvements in service, no matter how small, are all a good change. They should therefore be considered as a key objective for everyone in any organisation.
2. It is everyone's responsibility to engage and contribute.
This leads to the second key principle, which is that it should be everyone's responsibility to engage in and contribute to this.
No departments or individuals should be excluded or allowed to think it doesn't apply to them. It's all or nothing if pace and success is to be maximised. Everyone must understand know they can influence the customers’ perception of service and so has a responsibility to find and implement ways to continually improve the service they deliver to both colleagues and customers.
3. Focus on your customers.
The third principle hinges on where to look for the best ideas for change.
Some believe that the best approach to continuous improvement is to keep a keen eye on competitors. It's true that in any business, it's important to know what competitors are up to, but I don't think they should be the key focus. The phrase I like is 'Look, but don't stare'. If you spend too much time and resources tracking competitors, you will tend to ignore or not look hard enough at what should be your main focus, which is your customers.
I'm reminded of something I once heard Terry Leahy of TESCO say during a presentation he made in Manchester Business School. That was:"When we stopped chasing our competitors and started chasing our customers, we thrashed the competitors".
I think that makes great sense. Of course, you need to know what your competitors are doing, but that should be considered as merely 'background noise'. Your main focus should be your customers - their needs, aspirations, thoughts and feelings. They are where to look and learn what you need to do, how important it is, how urgent it is, and therefore what your pace of improvement needs to be.
4. Complete conviction from the leadership.
Turning to beliefs, I think the key one should be held by the leaders.
You can’t successfully implement something you don’t fully believe in. It’s therefore vital that leaders believe, and are seen and heard to believe, that the delivery of service excellence will lead to lasting customer loyalty and build revenues and profits.
I’ve been lucky to work with many business leaders that have successfully made service delivery make a massive positive difference to business performance and results. Almost all of them had one particular trait; they had much more than a belief in what they were doing, they had a conviction, which the dictionary describes as a belief in something that requires no evidence or proof to validate. When leaders have that degree of belief, others will naturally follow their lead, and success will result.
Systems and processes
1. A customer feedback system.
The first and most important system is an effective customer feedback system.
This is how you learn where and what improvements are necessary and how urgent they are. My experience has shown that the best customer feedback systems are real time and event driven. By this I mean that customer feedback is gathered continuously, and not just once or twice a year. Occasional feedback like this is useful for tracking general trends, but it's not enough to fully tell you all you need to know or to drive a winning pace of improvement.
The ideal system is one that triggers the opportunity for feedback from customers every time a significant event happens, like say a delivery being made, a fault being fixed, or a complaint being reported and handled. Such feedback will create a continuous stream of valuable, timely information. Then you need an effective system to analyse this information and promptly get the results to the people that can act on it. This will then become be a powerful driver of continuous improvement, with pace.
2. An external benchmarking system.
An external benchmarking system will also trigger worthwhile improvements.
Many organisations do this by looking at what their competitors are doing. That's OK, but I'm convinced that the most worthwhile improvement ideas rarely come from competitors. The goal should not to be as good as competitors – it should be to be better; much better! You therefore should be looking for the world’s best performers, from any industry or sector, in any subjects that interest you. You can then work out how to introduce their winning tools and techniques into your organisation. Done well, that will get you ahead of your competitors in ways they will have never thought of.
3. An experimentation system.
The last system worth a mention is an experimentation system.
By this I mean a systematic approach to the trial and error processes necessary to develop new and better ways of working. In any such system, where you're stepping into the unknown and trying what's not been tried before, these trials will inevitably generate more failures than successes. But that’s OK, and people need to know it’s OK to try and fail at something new. But if you do it right and stick at it, the few breakthroughs that result should be worth all the mistakes and dead ends that led to them. This too will then stimulate continuous improvement with pace.
Tools and techniques
There are many tools and techniques that could be used to create a winning pace. The following three are in my view the ones that when merged, make the biggest difference.
1. Set your aspirations high.
Gary Hamel from London Business School is great for short quotes that contain real wisdom and make you think. There’s one at the beginning of this article, and here’s another: "No company outperforms its aspirations".
Your aspirations will either improve or limit your achievements. For continuous improvement it’s vital to set your aspirations high. The goal is not just good, but great, and not just best in class, but world-class. This thinking can also be applied to the pace goal. You should be aiming not just for a fast pace, or even for the fastest pace in your sector, but for the fastest pace of improvement possible. One way I’ve seen to stimulated this, is to reward people not just for achieving certain goals, but for also achieving an outstanding pace of improvement.
2. Attitude and focus.
Attitude and focus are also important. Shawn Achor is a psychologist working at Harvard Business School. He is one of the World’s most knowledgeable people on the subject and effects of Mental Positivity. (His TED presentation about this has now had almost 2 million viewings.) The key point he makes, which relates to this subject of pace, is that we always have a choice about how we view anything. He calls it "the lens through which we view the world".
Put simply, whether we view things with a positive, neutral or negative attitude, is a mental (and leadership) choice we make. But the lens we choose will influence not only our own outcomes and life, but also those of the people around us.
It’s therefore important to choose a positive lens for this. Things will go wrong, and you can’t ignore them, but the main focus needs to be on the things that have gone right. Some things will not work, and they too can’t be ignored, but focus more intently on what is working. You can and should look for faults to eliminate, but you should look much harder for successes, and then find ways to spread them.
The third technique is celebration. Psychologists tell us that a deep principle of human nature is a craving to be appreciated. Celebrating success is a very important element for showing appreciation and creating and sustaining a winning pace. This is something that we’re generally not very good at in businesses in the UK. But if you want to keep up enthusiasm, energy and therefore pace, you need to create simple techniques to recognise and celebrate all successes.
So there you have it, a few ideas about pace. Remember that all new things are hard to get started and can cause some pain to begin with, (for example, just try adopting a new tennis racquet grip or golf swing!).
But there’s real pleasure in it too, because it’s very satisfying to know that your organisation is the one to watch, but impossible for competitors to catch. There’s power in it too, because if you can create the winning pace of improvement you will have the power to attract the most talented people and to keep the most profitable customers.
I want to end by referring back to the subject of continuous improvement. I think within it there are two specific and powerful types of improvement.
- Conspicuous improvement. This means improving in a way that customers will notice - and love. You want them to be forever wondering what next? So they will be looking forward to their next experiences, excitedly knowing that in some way they will be better than their last.
- Combative improvement. This means also improving in a way that competitors will notice - and hate. You want them also to be forever wondering what next? But in their case, dreading discovering it, and feeling demoralised by the knowledge that it will in some way have moved you even further ahead of them.
These are two powerful examples of how a winning pace of improvement can cause pain for competitors and pleasure for you and your customers.
Chris Daffy is one of Europe’s best-known customer service fanatics. He is a Companion of the Institute of Customer Service, and founder of The Academy of Service Excellence. His experience and expertise has taken him all over the world as a consultant and conference speaker and enabled him to work with organisations a varied as 3M, Airbus, Air Products, AXA, BAE Systems, Brenntag, BT, DLA Piper, Dorchester Group, ING Group, JCB, Microsoft, Pizza Express, Toyota, Watches of Switzerland & Xerox. His website addresses are – www.chrisdaffy.com , www.loyaltymasterclass.com & www.customerserviceuk.com . His latest book Creating Customer Loyalty is now available from Amazon. His telephone is 00 44 1663 766300 or mobile 00 44 7831 628898.
Chris Daffy is one of the UK’s best-known customer service fanatics. He is a Companion of the Institute of Customer Service and founder of The Academy of Service Excellence. His experience and expertise has taken him all over the world as a consultant and conference speaker and enabled him to work with organisations as varied as Airbus, Air...