Where Does Value Come From?


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IBM’s annual survey of CEOs* identifies five traits for what IBM calls ‘the enterprise of the future’. One of them, intriguingly, is “innovative beyond customer imagination”.

In other words, don’t ask customers what they want from the customer experience, surprise them. This is right, of course. Customer research is useful for finding out what customers think of your current customer experience. It’s not always so useful in anticipating where to go next.

When Virgin Atlantic tested with customers the idea of a new form of private lounge, The Clubhouse, complete with a video game ski machine and hairdresser, it was rejected. Customers simply couldn’t imagine it.

Branson and Chief Marketing Officer, as he then was, now CEO, Steve Ridgway, went ahead anyway with their plans for a new form of lounge. It was and is a massive success. Customers couldn’t imagine it until they experienced it.

So that phrase of IBM’s – that you have to be ‘innovative beyond customer imagination’ – rings very true to me. Ask customers what they want, says Kjell Nordstrom, the Swedish economist, and the answer will nearly always be “more of the same, but do it better”.

Your role as a creator of a compelling, unique customer experience is to know what customers will love before they do themselves, even if they can’t tell you that because they can’t imagine it. You have to know them better than themselves, in other word. And then take a leap of faith, even if it goes against what customers say they want. That’s why being bold is an essential attribute for creating a compelling customer experience. Hence the title of our new book Bold Business.

But, don’t think that this ‘innovative beyond customer imagination’ skillset is a rarefied thing, confined to high level customer experience designers, working with the boardroom, which is one essential part of what we at smith + co do.

The need to add personality and flexibility into the customer experience means it is just as important to get the front line element right as it is to get the top level ‘beyond imagination’ idea right. Indeed, your front line people may well have the insight into your customers that will help you create and evolve your customer experience beyond your customer’s wildest imagination.

There’s a powerful phrase that encapsulates this and gives us the answer to the question ‘Where does value come from?’ that heads this post. It’s in Peter Georgescu’s book The Source of Success, and it goes like this:

“The key source of value in today’s corporation (is): the relationship between the informed customer and the creative employee – a relationship that must be built with honesty and integrity.”

That struck me as a profound and powerful insight. ‘The informed customer and the creative employee’ – It’s in the interaction between the two, in that space, that your customer experience happens. That’s where your market is made, one customer at a time; where loyalty is won, where value is created, where customers become fans. Or, if you’re not paying enough attention to what happens in that intimate space, then that’s where you lose the customer experience battle to your competitors.

*The Enterprise Of The Future, the latest in IBM’s annual survey of what’s top of the agenda for over 1,100 CEOs around the world, is downloadable from IBM’s annual global study of CEOs

Shaun Smith
Shaun Smith is the founder of Smith+Co the leading UK based Customer Experience consultancy. Shaun speaks and consults internationally on the subject of the brand purpose and customer experience. Shaun's latest book 'On Purpose- delivering a branded customer experience people love' was co-written with Andy Milligan.


  1. Shaun,

    The statement, “innovation beyond customer imagination” is a double edged sword. On the cutting edge I think back to a statement Gary Hamel and C.K. Prahalad made in their 1994 book on Competing for the Future, “Lead them to where they want to go but just didn’t know it yet.” Apple and the ipod is a good example of this sort of innovation.

    The bleeding edge of the sword happens when a company introduces complexity and confusion into the lives of customers and does little or nothing to reduce the resulting anxiety or frustration. Another way of saying this is that they don’t help the customer get over the idea gap. When this happens the customer doesn’t get it, doesn’t buy it or dumbs down the concept to a logic that already exists. This prematurely pushes the product into the realm of commodities.


    John I. Todor, Ph.D.
    Author of Addicted Customers: How to Get Them Hooked on Your Company.


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