Customer First – myth or reality?

BY GRAEME CHIPP, PARTNER

To paraphrase the famous Winston Churchill quote:

  “Never in the history of commercial conflict was so much written by so many about Customers but understood, let alone practiced, by so few.”

As we enter a new year with the daily headlines of the financial services Royal Commission taking a break from the front pages, a critical truth may become lost in the story.

The evidence is not in doubt. Despite what CEOs and boards have promised over the years as their critical mission, further emphasised in Annual Reports and market briefings on a regular basis, the Customer is far from being at the centre of the organisation or the positive driving focus of business culture, decisions and actions. Indeed, with many of our leading organisations, customer centricity seems no closer.

And the irony is that customers have never had so much devoted discussion. It has even spawned a new industry of specialist services around customer experience - familiarly known as CX - with many millions of dollars invested with questionable returns.

Graham Chipp

"The truth is that customer led transformation requires a new approach. Not customer experience improvements, but a ‘whole of business’ approach focused on establishing effective intent across the entire business combined with a heavy dose of customer reality."

One could be forgiven for thinking that suddenly understanding the customer’s needs and behaviours is the new mind-opening discovery of the C-suite and boardroom. We’ve even seen new C-suite roles created: Chief Customer Officer, Customer Experience Officer, and so on. ‘To win in the ‘customer-winning’ game, just buy this program, plug it in, marvel at the data, and victory is on its way’...!

The sad reality is that understanding what ‘Customer First’ actions mean has not been backed by evidence of improved customer outcomes. Why is this so?

The truth is that customer led transformation requires a new approach. Not customer experience improvement but a ‘whole of business’ approach focused on establishing effective intent across the entire business combined with a heavy dose of customer reality.

2019 should be the year where the gap between organisational intent and desired outcomes is closed.

 

Here are six questions to consider that will help you re-dress the imbalance on whether you are getting a return on your own Customer Experience investment.

1. Is customer empathy and insight a core value and skill of the organisation?

As the saying goes, ‘What gets valued, gets done’. Empathy is both a value and a skill dependency for any customer first organisation. Is empathy a value articulated, taught and re-enforced in your organisation?

Much has been written about the value of data analysts as a core skill for organisations and work of the future. But well underdone in this debate is the need for those who can read and interpret human behaviour, and inform where data analysts and technical skills can be directed to identify and translate how customers buy and make decisions. Behaviour is a lead indicator and, often, observation and interaction can uncover motivations and influences in the context of purchase decision.

Think about your own organisation’s customer charter and values. Read them from the point of view of your customer. Now from the perspective of each corporate function. Are they consistent? Do they have together as a guide for customer first outcomes? Now consider your organisation’s staffing strategy. Are you hiring and developing people who can understand and lead customer first outcomes?

2. How clear is your customer strategy? Does it pass the three-way test?

Customers are the source of where revenue and cash flows. Customers also determine your brand’s superiority. So it's imperative that it is clear to all which customers you aim to serve.

Three questions to ask - Are we all clear on which customers we aim to serve? What customer needs our organisation is striving to meet? And, how will our business work effectively together to deliver these needs, consistently and profitably?

Think about the wheel spin internally that occurs through debate on which customers you’re targeting or what they need. It's important to ensure each function is on the same page in terms of what role they play and how meeting customer needs can make a significant difference.

3. Is your customer experience program delivering a winning customer promise? 

Great brands deliver on promises made, with a customer experience that consistently matches or exceeds customer expectations. Too often, brand promise is not embedded into the transformation or customer experience work – it’s an afterthought.

Great brands anchor the design of customer experience in delivering their chosen brand promise.

Outstanding customer experience is only achieved when expectations are met or exceeded. Too many CX programs don't apply enough thought into understanding different expectations or use context of different customers. Understanding this will drive very different responses in CX design and customer impact.

Consequently, the essence of what drives an outstanding customer experience is often at risk of being misunderstood with customer experience solutions missing the mark.

4. Are you organised to deliver your brand promise? How are you breaking down the silos? 

The organisational, often legacy-system, siloed structure challenge continues. Customers don’t think in silos, yet practicalities require us to organise this way. So, the game of unintended consequences – 'whack a mole' – remains well and truly alive.

Ensuring your organisation has set up to effectively work across functions, with all teams on the same page as to the customer promise and how they collectively will deliver consistently against this, is acknowledged as valuable but often misses the mark.

Shared purpose and governance, cross-functional project teams with aligned support systems, measures, and processes, all will help.

5. Can you remove the constraints with and within your systems, processes and operating practices so these can help not hinder?

Do you have the right measures in place? Are these promoting the right behaviour. How can these be focused and simplified?

In our experience, Net Promoter Score (NPS) doesn't always provide the right cues as where to focus and what to address. As the NPS has moved to a default industry standard, thinking and challenging what are the right customer measures has become lazy. While NPS indicates the degree of customer advocacy, the quest for a ‘silver bullet’ metric is often impractical and counterproductive.

Furthermore, customer data strategy is often lacking insight. 'Ones' and 'Zero' based data is one form but can only get you so far. There is a need to ensure management get a feel for human motivation and behaviour when making decisions. 'Data heavy/insight light' is too often the claim.

There is a role to think through what other qualitative or observational data can be used alongside judgement to determine customer impact.

6. Finally, are your leaders setting the right tone?

Too often the board isn't brought into the world of the customer. Bring the customer into the boardroom. Board and CEO decision-making is too far removed from the Customer perspective. What are your leaders doing and saying to set the right tone? Requiring cascade leader-led communication of intention, how can both the board and management ensure a heavy dose of customer reality is continually kept front of mind?

The inevitable move to more compliance as a protection for customers is only one lever to manage risk and, indeed, could worsen customer experience. Investment in board skills and exposure to customer can only help; As will the role of the CEO and team in re-enforcing and encouraging a customer orientation to strategy development, decision making trade-offs, and day-to-day operations management.

A closing thought

Consider your own recent customer experiences and compare these against your expectations. As a shopper or consumer of energy, telco, government services or with your business service providers. Recall the promises made, "your call is important" voice recordings, and why you made the last decision to move your business. Then read your own carefully crafted statement of Customer dedication.

It’s not just the Banks and other financial service companies. While currently in the glare of the customer neglect spotlight, they are far from being alone in the charades of customer-centric claims. It’s time for a serious reality check across your business about how well you’re set up to deliver ‘customer first’ claims.

What did you uncover? Myth or reality?

Speak with our Growth Practice expert