Hidden Champions know (and serve) their customers better


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«Hidden Champions of the 21st Century» by Hermann Simon made quite an impression on me and I want to share some insights.

The book reveals success factors and strategies of companies that Simon calls Hidden Champions.

Hidden Champions comply with three criteria:

1. No.1, 2 or 3 in the world market or no.1 in Europe (Europe centric view here)
2. Total revenue less than 3 billion Euros
3. Little known in broad public

In short, very successful small to medium sized companies mostly specialised in a specific niche.

I don’t want go into all of the success factors, but point out one, that I found very interesting especially in contrast to very big enterprises: customer relation and understanding.

According to Simon Hidden Champions have a very close relation to their customers. In contrast to big enterprises the rate of employees with frequent client contact is five times higher. Also top management values direct client contact highly.

These Hidden Champions usually have a holistic view of their clients. They have cross-organizational teams that take care of a client or segment rather than segregated departments that have been split a long the value chain. Not only does this segregation hinder a holistic understanding of a customer but often big enterprise departments fight little wars with each other (e.g. marketing and r&d). This results in a waste of resources, obstructs innovation and by that reduces customer value.

And customer value is what drives Hidden Champions and makes them successful. With their good understanding of their customers they are able deliver high customer value solutions, because they know about problems and needs of their customers and tailor solutions to fit them optimally. Often they team up with their customers and develop solutions together. This leads to satisfied customers that are less price sensitive but value quality, customer proximity and consulting.

While a lot of the Hidden Champions’ businesses are about high quality, high tech products they actually sell solutions, integration and finally their competence and skills to deliver what their customers need. The actual products are – although very important – just part of the means to solve their customers’ problems or satisfy their needs.

I see a parallel to Customer Experience here in various ways:

* Products and services are also part of a higher goal, i.e. creating customer value by delivering a good Customer Experience.
* In order to be able to do so companies have to fully understand their customers, their needs and desires.
* Employees need to understand customers, their issues and relation with the company beyond their own area of responsibility.
* Good Customer Experience requires a seamless integration of proceses and interaction throughout the company: departments need to work hand in hand not against each other.
* As well as being able to serve and satisfy customers on a very high level of excellence requires competence and values, delivering a superior Customer Experience requires the latter.

I agree with Simon that big enterprises could learn a thing or two from the way Hidden Champions work, since there is more than one example where one of the Hidden Champions has driven a big enterprise out of the market.

Helmut Kazmaier
Electrical engineering background. Seven years experience of User Centered Design and User Experience Design. Shifting focus to Customer Experience including all touch points of the customer experience chain.


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