Not long ago I participated in a webinar in which one of the keynote presenters was someone very well known as a thought leader in the customer relationship world. This respected speaker inexplicably (to me, anyway) spent the first third of the session discussing “why customers are so important.”
I wasn’t sure whether I’d stumbled into a parody of an industry conference, or if this was some sort of high school level introduction to business. Anyway, it sometimes seems to me that we still spend a lot of time debating the wisdom of creating “customer centric businesses.” The desirability – indeed, the necessity – of doing so should no longer be an issue.
That’s why I enjoyed an exercise at the recent CustomerThink retreat, where participants focused instead on defining the customer centric business. Many of the attributes discussed were rather self-evident, e.g., listening to the customer, welcoming the customer’s voice as a key stakeholder in product design, empowering staff to satisfy legitimate customer needs and desires without resort to bureaucracy, and so on.
But one insight struck me as a rather original one, and a thought worth sharing: that a customer-centric business is one that does a good job of balancing short- and long-term goals and objectives.
While attention must be paid to short-term metrics such as quarterly earnings growth, I think you’ll find a correlation between those businesses that over-emphasize such short-term measures and those whose business models are the least customer centric. That’s because the activities that lead to increased customer retention and loyalty, and ultimately to maximum lifetime customer value, take much longer than a quarter to measure. Such activities include management leading by example, personally interacting with customers; or selecting, training and compensating frontline staff so that they will surprise and delight customers when they interact. These are the kind of actions that invest a business with customer centric values – and it is values, not tactics, that make a business customer centric.
Howard, thanks for a great blog. Perhaps there has been too much time spent explaining why customers are important. I’ve probably been guilty of that a few times myself.
It is amazing, though, how far out of touch businesses can be about their customers. Some think they are customer-centric because they can track purchases by customer segment.
I do believe it’s important to turn our attention to how to create and grow a successful customer-centric business. And it has to start, in my opinion, with a courageous leader willing to look past the short-term costs and bet on the long run.
Bob Thompson, CustomerThink Corp.
Blog: Unconventional Wisdom