Value Creation is all about how it impacts CEO thinking on short term vs long term, and how he can add value to customers, employees, and build the Value Creation principles in departments in the company. We have talked about creating value in training, in leadership and in making the customer your partner and making him your ambassador.
We have suggested to the CEO to change the focus of departments such as HR and IT to become customer focused and become line managers. We have dwelt upon reducing the focus of executives on routine tasks and concentrate on important value creation jobs, instead “outsource” routine work. We have talked about the future, self-tuning companies and agility, adaptation and ambidextrousness, moving from selling to customers to becoming his buying aide.
CEO’s must have a Value Creation strategy in order to implement all of these. This includes many of the steps mentioned above.
One major step is to change your companies and which should be part of your strategy is to break silos and make the customer the focus of all departments, and make the customer experience seamless.
If companies truly wish to give the Customer his deserved place in the company, they have to start a Customer Department. This department will have all functions that are necessary for and/or relevant to the Customer. The functions include product development and products, manufacturing delivery and delivery chain, supply chain, IT and even manufacturing.
Why is a Customer Department needed?
First to break silos and unnecessary demarcations in companies where the convenience of the company comes ahead of the convenience of the Customer (let’s say the delivery departments focus is on cost cutting and not on working out methods to suit the customer)
Second to have one point of control for the Customer
Customer reporting: the Value we added to the Customer, and his value to us. Have these gone up?
No more billing goof ups at the finance department
A proper and dynamic customer strategy
Customer Improvement programs
Promises and procedures to ensure the Customer’s Bill of Rights is honoured
Seamless delivery
Service Department
Customer relation problem to solve customer problems
How will the Customer Department function?
It needs one COO type of coordinator or manager
Non customer related work (like tax, treasury, employee information such as leave due, leave taken, attendance, functional training like finance for non-financial mangers) are not part of the Customer Department
The COO acts as the Chief Customer Officer, whose role is to ensure that Customer tasks are divided within the Customer Department, and the departments become Customeric. Executives are taught to focus on the Customer and his needs. Continuous Customer improvement programs are put into place. The COO ensures that the Customer comes first and divides the department and thereby the company. Employee Value Creation programs are started.
The COO reports Customer scores along with why scores are improving or not, and to correlate with market share and profits.
The CEO focuses on the Customer Department and non-Customer Departments and reports Customer and financial data to the Board. The CEO assigns key performance indicators and customer score driven bonuses.
Hi Gautam
A customer ‘Bill of Rights’ is the equivalent of a ‘Company Bill of Responsibilities’. They are in effect the mirror image of each other.
If customers have Bill of Rights, do they also have a matching ‘Bill of Responsibilities’? A Company ‘Bill of Rights’ so to speak.
In moral societies rights usually come together with responsibilities in roughly equal order.
Graham Hill
@grahamhill