The term customer centricity has been around for years, however it is only really in the past five years that organisations have begun to pay it any real attention. It has increasingly found its way onto the agendas of board rooms around the globe, but for most it has remained a concept rather than a reality.
Customer centricity is somewhat of a curate’s egg, with some good bits and some bad bits. And here’s why…
It would be very difficult for anyone to disagree that focusing on the customer is a bad thing. After all, it is the customers that ultimately pay all of our wages. They provide the money from which the company makes its profit. Not focusing on the customer would seem intuitively wrong. So for an organisation to state that it would like to be more customer centric is a clear indication that the business is taking the matter seriously. Surely it can only be a good thing?
On the other hand, for some, customer centricity is beginning to get a bad reputation. And there are a number of reasons for this:
- Lip Service – In the worst possible scenario, there are individuals within a company who will be seen to publicly back customer centricity, as it might be viewed as the CEO’s or COO’s latest ‘toy’, but in private they consider it to be fluffy nonsense that gets in the way of running the business properly. These people truly don’t get customer centricity and possibly never will.
- Everyone’s second priority – Even in an instance where every single individual agrees that focusing on customers is the right thing to do, it still might not happen. The reason for this is often that in functionally organised businesses, of which most are, the customer is important, however is always a secondary priority to the ‘day job’. The CFO might wholeheartedly agree with it, but month end or year end will always be more important. The Sales Director loves customers, but hitting his quarterly targets is always going to be his priority. And whilst everyone prioritises their day jobs, customer centricity is always likely to be an afterthought.
- Great, but how? – Then there are those that don’t really understand what customer centricity is, or what it actually means in practical terms for the business. I once overheard a cynic ask whether we should be standing around the customers in a circle in order to be truly customer centric! Even for those people that understand the concept, many still need guidance on where to start.
- Farming out – When the C Suite are unsure of where to start, they will often delegate it down the chain to someone who may not have the influence, authority or resources to get the entire exercise off the ground. Often they need some guidance on where to start too.
One of the biggest stumbling blocks is where organisations treat customer centricity as a work stream – something that can be managed as a project alongside all of the other projects within the organisation. What many don’t truly appreciate is that for an organisation to become customer centric, it isn’t just about doing a few things a little bit differently, it’s about full scale culture change. And such a culture change exercise involves every single person in the business, has a significant impact on leadership resources and time (at least initially) and may take something in the region of 3-5 years to complete.
They say that a product can be copied in five days, a service can be created in five weeks, but it can take up to five years to change a culture. How very true.
Culture Change – from Power Centric to Customer Centric
In a blog two years ago, we wrote about Business Culture and all of the different considerations required for/during transformation. Thinking specifically about customer centricity, the following needs to be considered:
- Power & focus – In the business culture blog, we spoke initially about three things, namely culture coming from power rather than leadership (often they are the same, but not always), creating a common focus, and concentrating on what unites rather than divides.
‘The customer’ provides is an obvious common focus/ point of unity, and can also hold the key to breaking down negative power structures. You get the business to stop pointing inwards and to start pointing outwards by refocusing the business away from negative functional misalignments & squabbles, and towards the ‘higher authority’ coming directly from customers’ pockets!
However different ‘levels’ of the business ‘point inwards’ for different reasons, so we need to tackle each, layer by layer:
Cultural change – layer by layer
- The Leadership team
The senior team understand the importance of customers, yet with so much functional responsibility – with so many people’s livelihoods at stake – customers are always going to be everyone’s second priority. They can be presented with poor NPS and CSAT scores, however this still might not be enough. When significant problems arise, even the senior teams of major multinational brands can be guilty of functional retrenchment, hoping that someone else will address the elephant in the room. But there is only one easy way for a tribe to take down an elephant – together!…
One of the things that we do to bring the elephant into focus is to undertake some kind of Leadership Immersion exercise, whereby the leaders of the business get to experience first hand what their customers experience. There are several different techniques that can be employed, one example being what we call a ‘To the CEO’ voxpop video session. When undertaking focus group research, we got participants to speak directly into the lens of a camera and recorded them telling the CEO of the company exactly what they thought of the business. When this is played back in the boardroom, this can starkly illuminate the depth of the issues, providing that essential ‘moment of realisation’. Combined with other immersion techniques, this can provide the moral authority required to get full boardroom backing.
- The Frontline
The people who deal with customers on a day-to-day basis understand better than anyone the problems faced by these customers. Although they ‘get it’, they might not always know how to address the issues, or have the authority to do so.
The challenge is, when the business eventually does attempt to take the issues on, the frontline teams are often cynical. Poorly conceived previous attempts to tackle some of the key customer issues lead the frontline teams to view each new initiative with contempt, stating that they’ve “seen it all before”.
There are two things that can be done to help get these teams ‘on side’:
- Big Statement – the frontline teams can usually tell you why the initial initiatives went wrong. Half-hearted activities and contradictory policies are easy for everyone to spot. So for this initiative to stand out from the others, the business needs to make some kind of ‘big statement’ that shows that they are serious this time. Examples of this can be the dropping of unfair charges or policies that disadvantage customers, yet are perceived to be a revenue stream for the business, e.g. dropping a premium rate customer support helpline
- Leading the charge – As the frontline teams have the best knowledge of the customer issues, it makes sense that they take a primary role in leading the transformation activity. This not only helps the business get it right, it also helps engage the frontline teams, ensuring that change not only happens, but also remains embedded.
- Middle Management
The most difficult part of the business to come around to customer-centric change is middle management, as they can perceive themselves as potentially losing the most. Customer centricity involves breaking down cross-functional barriers, which can be viewed by the middle management as a form of ‘land grab’ to their functional areas of responsibility. It isn’t always in their interest to cooperate with others, so they also need to undertake some form of leadership immersion.
As long the senior and frontline teams are on board, the middle management teams are likely to find themselves ‘squeezed in the middle’, and can often be sacrificed through ‘delayering’ unless they are able to get onboard with the customer centricity message.