Why Customer Centricity is still disrupting you
Customer centricity transforms every aspect of your business and leaders can’t afford to slow down implementing it. Here’s a refresher to keep the momentum going!
On a recent Learning Expedition, an executive of a large multinational had to get it out of his system: “Since I can remember we talked about putting the customer at the center of what we do,” he said, “and yet even as recent as a couple of years ago, when we completely redesigned our loyalty program, the first thing we did was to lock ourselves into a room.” Of course, they used customer data and they had insights about their customer, he said, “but thinking back, I can’t believe none of us thought it strange we had everything we needed to get started in that room.”
A lot of our participants have these moments on our programs — a sudden epiphany that, with all the best intentions, things have not been changing as fast and radically as they should have.
Customer centricity is challenging not least because it can lead to a complete reinvention of an organization’s purpose and structure.
The narrative of disruption is all to often reduced to the story of niche players disrupting big brands, emerging locally and close to their community until they become more relevant than the incumbent.
The story about the disruptor suddenly coming “out of nowhere” and destroying a whole industry’s business model is catchy, but also too specific and infrequent to make a real impact in companies. But established big players are cultivating disruption and take it to market successfully, and so creating alignment behind customer centricity becomes an inevitable task.
Customer Centricity needs access to all areas
In its essence, customer centricity or customer obsession (you say ‘Tomato’…) means that every strategy, process, operation, and product should be created with the customer and customer needs in the center. The goal is always to create the perfect customer experience and starting by really getting to know your customer (read our article about empathy for more on this).
Are we measuring the right thing?
On a strategic level, the value proposition for the customer should feature prominently in the purpose and values of a company. But crucially, this has to be reflected in the metrics that are used internally: Are the key performance indicators the right ones to measure how well the company is doing in terms of customer-centricity? Are they defining milestones and roadmaps? Is it driving revenue?
KPIs can be something like Customer Lifetime Value (the amount spent by one customer in his or her relationship with the company), Customer Equity (number of new customers over a given period multiplied by their CLV), Early Repeat Rate (how many customers make a second purchase within a certain period), and many more.
For our client Belfius, for example, customer satisfaction is a strategic priority. Each cost and investment is examined in view of its true added value for the customer. Belfius is aiming for a global satisfaction score of 95% and has been exceeding year after year.
Customer centricity needs to be embedded in values and underpinned by rituals. Behaving customer-centric is still a struggle because many organizations lack the shared language and so inevitably conversations follow old patterns.
It doesn’t help that IT people talk about agile, product people about lean and strategy people about customer obsession. While the methodologies all make sense in their own right, they are meaningless theories if they are not anchored in a bigger context. They need to find expression in the way people behave, talk and refer to their goals and missions.
The fantastic opportunity of customer centricity is to finally speak the same language. When everybody has a shared understanding of the customer or even several customer personas, silos are broken and productive conversations happen effortlessly across teams and departments.
Establishing processes that connect every team to their purpose and goal in the customer value proposition is fundamental. For example, are employees given access to customer feedback?
It seems much harder for individuals in large organizations to step outside and connect with their customers or even bring relevant knowledge and insights from their life outside the gates into work. But allowing for inspiration to come from outside the company is crucial. Having the customer in mind is not the same as leaving the desk and meeting the customer one to one.
It’s a mistake to think providing summarized customer feedback is enough, even for a team that is one step removed from the touchpoints of the customer. A spreadsheet with customer data seldom sparks a sense of urgency and motivation to innovate.
Many companies are using the voice of individual customers to let people see directly where the pain points are. Healthcare providers Sanitas and Bupa, for example, use an app that let’s their employees hear unfiltered feedback on specific points of the customer journey.
Other solutions integrate with inboxes or other communication channels. This also allows employees to share inspiring insights and communicate their ideas better.
All of this is driven top-down. Leaders must take action, let their company evolve with their customer and enable change where necessary. This means they have to put themselves into the customer’s shoes too. Not talking to customers directly is unacceptable in today’s world.
Continue with our article: Empathy in practice — Dive into the world of your customer.
More about Customer Centricity:
To be truly customer-centric, Companies need to place a higher value on empathy. Here are some ideas on how to do this and why it’s not a choice.How much good has ever come from not being empathetic? A lot, you’d think, given the word’s wallflower existence in the corporate responsibility section of the website. Outside of people writing glossy copy, empathy is seldom mentioned or referred to as something to be implemented into practice. Or so it has been.At the World Economic Forum in 2015, the CEO of a British [...]
Sign up here to subscribe to WDHB Quarterly and get new inputs and news from us – you guessed it – four times a year!