“Outside-in” is a popular term in the customer experience field. It refers to the importance of customers’ inputs as a guiding light for the inner workings of an enterprise. In the quest for “outside-in” most companies have voice of the customer programs, loyalty programs, and high-touch service. Even so, these outside-in efforts are typically skin-deep. Outside-in is often only being brought into the customer-facing portions of the company. And the rest of the company is still behaving in inside-out mode. In the future, companies that are truly outside-in will outpace their competitors in success.
A consequence of skin-deep outside-in is a mis-match of customer-facing messages with the reality of processes, policies, business models and products. How many companies do you buy from where this is the case? Most likely, your answer is more than there should be! Mis-matches may be tolerated presently, but they do not bode well for the future. Customers’ trust is eroded by inconsistency. Especially with inconsistencies between what is said and what is done. It’s the non-customer-facing parts of the company that generally create the bulk of what customers buy and experience. Customer-facing staff and touch points are often a buffer between mis-matches and heroic efforts to mollify or endear customers.
Let’s compare superficial versus true outside-in (read from left column to right column, line by line):
|Your Approach||Skin-Deep Outside-In||True Outside-In|
|VoC asks . . .||how the company is doing||how to support customers’ goals|
|Journey maps focus on . . .||touch-points||customers’ consequences|
|Closed-loop communication is with . . .||low-raters||all customers|
|Customer comments are . . .||summarized||read by everyone|
|Metrics focus on . . .||customers’ behavior/ratings||VoC action plan progress|
|Fixes . . .||are by customer or by department||prevent recurrence for all customers|
|Voc action . . .||planning is optional or by top issues||plans are systemic, involving everyone|
|Skill building focuses on . . .||customer-facing staff||internal value-chain|
|Marketing . . .||leverages the positive||is grounded in customers’ realities|
|Customer retention . . .||is pushed||is earned|
|CX investments . . .||make up for mistakes||aims at doing right the first time|
|CX excellence is . . .||customer-facing groups’ job||a way of life, no exceptions|
|CX insights are applied to . . .||image-building||policies, rituals and culture|
|Goal: . . .||customer evangelism (immediate revenue)||mutual value creation (organic growth)|
|Attitude: . . .||what can customers do for us?||what can we do for customers?|
True outside-in requires humility and falling in love with customers. It’s akin to keeping a romance fresh. It’s about aligning the company to the boss: customers. Not the other way around. It recognizes that shareholders leave when customers leave, not the other way around.
True outside-in rises above industry norms. It looks objectively at the plight of customers, and strives to stand out from the crowd in fitting like a glove to customers’ needs. It rises above mainstream customer experience management practices, as described in the table above. It considers what makes the most sense for long-term value to all parties: customers, employees, investors, and other stakeholders. For example, in the book Firms of Endearment, the most-loved companies have a balanced approach to managing the interests of all stakeholders, and their performance far outpaces their competitors and the S&P 500.
True outside-in is transformation-oriented. Transforming the inside, not the outside. Yet using customer experience insights to guide it, not traditional cost and politicking parameters. One of our clients was sophisticated in value stream mapping, or process management for smooth flow of information and materials. Prioritization of improvements was based on issue frequency and cost to the company. When our customer experience journey mapping quantified consequences to customers, it became clear that the standard prioritization formula was flawed. Customers were splitting their orders with different suppliers because of inconsistency in delivery times. By omitting customer consequences from its internal criteria, the company was unknowingly losing significant revenue that was going to competitors. Prioritization first by consequences to customers, and second by cost to the company made a lot of sense, considering that customers’ well-being is a prerequisite to the company’s growth.
True outside-in is value-creating. Not just value-extracting. We’ve all seen industries implement policies to extract value from customers without value creation, and it’s not a pretty situation. Customers have already paid fair market value for our product. To extend revenue, we should extend value to continue a fair dynamic for customers to further engage with us. Focusing on the customers’ goals can make a huge difference in what we can achieve through CXM. First of all, it gives employees and suppliers a higher purpose. Second, it is the key to being more innovative, and more successful in launches. Third, it characterizes expectation-sets. Customer segmentation and CX personas based on expectation-sets are more natural and a better view of reality, and they are instrumental to every manager using CX excellence as a context for their decisions and deliverables.
It’s human nature to be inward-focused. Yet inward-focus is dysfunctional. We know that’s true for any type of relationship. Like the saying, “No man is an island”, a keen awareness of how we affect and rely on others is a sign of maturity in any aspect of life. Otherwise, as much as we’re reaching out, it’s actually from an inside-out, self-serving perspective. Companies that make customers’ well-being a guiding light for the inner workings of the entire enterprise will rise above the pack in the future.
This article is the third in a series of articles about Customer Experience for the Future.