You can’t handle the truth – why most leaders say they want their businesses to be customer-centric but aren’t willing to take the first step

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Creating a new business that endures over a long time is hard. We all know the statistics; 80 % of companies fail within the first 2-3 years.

What separates the businesses that sustain from those that wither away? Customer obsession. These companies have found a problem worth solving, a need that must be filled, and customers willing to pay. It all sounds simple.

What happens when these businesses grow up?

Over time their success breeds complacency. They no longer have to fight to win every customer; customers come to them; life is good. Leaders become managers and get paid to manage things already in place. The focus becomes the numbers, and the tail begins to wag the dog.

In markets where growth is turbocharged, mistakes are brushed under the rug. “So we stuffed up for that customer. There will be another one to replace them….”

It all goes well until the music stops; the tide goes out, and companies are exposed. Suddenly new products or services start failing not because they are bad products or services but because customers have lost trust. Managers have not been paying attention to the real source of revenue and profits – loyal customers.

Things have changed, growth has stalled, reputations decline, and customers are walking away.

Time for some customer-centricity.

The time has come to take a hard look at the business, how we are operating, what needs to change. We need to shift to a more customer-centric way of doing business!

Where do we start? How do we make it happen?

Like any and every major accomplishment in human history, everything great begins with one step forward.

In this case, that step is to take a realistic view of exactly how customer-centric you are as a business. For many that small step maybe a step too far: they don’t want to know.

Feedback hurts – it can feel like a knife twisting, gauging a hole in our being. It instills fear, even panic in us. And yet it is the truth, the way we perceive things is the way they are no matter what stories we want to tell ourselves.

So why do leaders say they want their businesses to be customer-centric but are not willing to take the first step?

Fear.

Fear of failure.

Fear of exposure.

Fear that it will distract.

Fear that it cannot be sustained.

Fear that they cannot do anything to change.

So what is the antidote to all this fear?

Just do it.

A funny thing happens when you face your fears – you grow.

If you think its time to face your fears and improve your business find out more about our unique customer-centric culture assessment here

19 COMMENTS

  1. “Just do it” is the right advice. I’ve never known a company to fail because their customer experience was too good.

    I’m not sure, though, that fear is the primary driver of the reluctance of companies to take the steps they need. It more has to do with underestimating both the potential payoff (NewVoiceMedia tells us that there’s $75 Billion dollars up for grabs), and the level of commitment it takes to get there. Perhaps the biggest roadblock is that these transformations are too often left to a ‘department’, and put in the hands of someone who has not authority or ability to effect systemic, cultural change. It has to be driven from the very top.

    Even when cultural change is championed at the executive level, there is the issue of persistence. They need to report monthly/quarterly on the impact of investments and initiatives. Transforming a company’s culture takes a strategic, methodical approach. There is an ROI to it – a big one – but not one that can be captured monthly or quarterly. It’s kind of like trying to capture the ROI of that vitamin we took this morning. Investors and board members are not renown for their patience.

    That all being said, “Just doing it” is still the answer.

  2. What you’ve identified is the tactical, non-proactive orientation of most enterprise leaders. When their managerial and leadership approaches fall short, and they are casting about for a ‘fix’, they reach for customer-centricity as a panacea. Like right-sizing and re-engineering from a couple of decades ago and CRM more recently,, this type of approach can have long-term damaging impact on the culture.

    The most effective stakeholder-centric path is servant leadership. Servant leadership, and its benefits to organizations, have been understood for centuries. In the Tao Te Ching, attributed to Lao-Tzu, it was written: “The highest type of ruler is one of whose existence the people are barely aware. Next comes one whom they love and praise. Next comes one whom they fear. Next comes one whom they despise and defy. When the servant leader’s task is accomplished and things have been completed, all the people say ‘We ourselves have achieved it!” Leaders of organizations desiring to be customer-centric, ultimately stakeholder-centric, and managers wanting to help leaders achieve that worthwhile goal, would do well to follow these ideals.

  3. Why do people who know they need to lose weight lack the discipline to do so? Hold that thought. Most CEO’s lack the discipline to start the path to being customer-centric or stay the course once started because they are 1) not obsessed with the customer or 2) lack the compelling metrics to see the value. Many CEO’s went to business school. Ask a CEO which course covered customer centric metrics?

    Now back to weight loss. I have a friend who was overweight and would not exercise and now is a health nut. What changed him? He had a near-death heart attack and now is obsessed with staying healthy. It altered his belief system. If mediocre service robbed enough of an organization’s customers (and you had the forensics data to proof it). CEOs would change (or their boards would change them). And, metrics? What if you had a Fitbit or fancy watch that showed you how many minutes your life was shortened by eating that donut or how many minutes were added for each mile you walked or ran? You might get on the treadmill. Note to change agent: Your job is to make a compelling case to CEO’s that being customer-centric has significant ROI in terms of customer retention, acquisition and advocacy. And, there are many ways to make that case if you use language understood by the value system of the CEO. “Just to it” does not get a couch potato off the couch or out of the kitchen. “Just do it…or you will suffer grave consequences and/or win big” is a far more compelling cheer.

  4. Many if not most executives proclaim their love of customers and are willing to take a first step doing… something. Like assigning someone to collect survey data, or putting up “the customer is king” posters.

    The problem is not the first step, but all the steps that must follow to create real change. It’s a daunting task, one that few senior leaders seem to master.

    So maybe their fear is rational. Much like I would be afraid to run a marathon, but would be fine running around the block.

    Your main point about customer obsession is right on, in my view. Top customer-centric firms have a genuine passion for customers, and they sustain it for years with the right strategy, hiring/training practices, metrics, etc. etc.

    My opinion: leaders of customer-centric “winners” are wired differently. They believe it’s the path to success and put all their energy behind it. They don’t have to exhort themselves to “just do it” because it just feels like the right thing to do.

  5. So why do leaders say they want their businesses to be customer-centric but are not willing to take the first step? Fear??

    No, the root cause is greed! They want to continue to remain at the top. Discipline is another issue – to stay on the course of customer-centric (Chip R Bell). Businesses have to look beyond profit (TBL) and rise above material leadership.

    My thought: A radical transformation of human thought process has to take place if we really want to achieve ‘customer-centric’ oriented businesses and want to treat ‘customer as king’

  6. Chris, a good read. While I personally subscribe to the ‘just do it’ philosophy (and its consistent with design thinking) I have to admit that fear is as gripping as asking others to play golf with hands tied behind their backs. I just posted a paper that is under review in which I note that fear can be a great impediment to success with CX initiatives. I have no illusions that this will be harder than stating that it should be extinguished.

    Michael makes a good case for leadership to step up. Unfortunately, many of those leaders too are gripped with fear, except for those who are wired differently, as Bob has noted. Observations by other colleagues in their posts are also compelling.

    Reminding readers of the fear impediment is worthwhile.

  7. Agree with the observations of Mohamed, Chip, and Bob. Would add, however, that there are also gradations on the leaders’ road to the limiting effects of fear. First level, I’d suggest, is complacency or inertia, defined as the tendency to do nothing and/or remain unchanged. I’ve often recounted the challenges of complacency where CX metrics are concerned. For complacent leaders, if CX initiatives are conceived and begun in this state, they ore often unsupported or passively supported at the top, given little attention, are assigned to managerial staff who know little about CX and have little interest in it, or unfunded/underfunded. Looking at these situations from the outside as a consultant, I’ve seen many worthy CX projects evaporate because of leader complacency.

    Complacency is the law of CX entropy working in real-time. Namely, if customers and value delivery do not have priority, or even sufficient cultural and process focus, the organization is in danger of decay, collapse or take-over

    The next level before reaching fear is timidity. This is not the lack of discipline or ‘finishiative’ that Chip described, but it is a lack of courage – the persona of The Cowardly Lion in The Wizard of Oz. Timidity is at least as damaging as complacency. Where CX initiatives are concerned, where decision-making push comes to shove, timid leaders will simply back away or move to something safer, or more easily understood, like cost-cutting, staff-reduction, or remaining product-centric, justifying such moves as a better use of resources. With these leaders, the customer isn’t king, nor is enterprise-level customer-centricity a goal, but just another flavor-of-the-month. A key challenge of leadership timidity, as well as complacency, is that it permeates and weakens the entire organization.

  8. First off, thank you all for your great insights and perspectives, your comments have quadrupled the value of this post and are much appreciated!

    Shaun, I agree the upside is huge but like anything with a big pay-off consistency and persistence is crucial. Many years ago I committed myself to always be physically fit and healthy no matter what obstacles stood in the way. Once the decision is made the rest can follow, but it requires a constant refreshing, re-energizing and reminding of that commitment.

    Gautam, lack of knowledge is still a big factor and the belief that it is all too hard so why do anything.

    Micahel thanks for sharing your great insights on servant leadership and your articulation of leadership complacency and timidity both factors that come into play.

    Chip, great question which business school does cover customer metrics? Seems it is covered a little exec ed but not built into a lot of MBA programs. The pain of the loss of customers is typically a significant driver of change in our experience also. Often this is not very visible (back to lack of customer metrics).

    Bob thanks for your thoughts. The way to start the marathon is by running around the block! There is definitely something different about customer-centric leaders, they are wired differently and I suspect better suited to the business world we face now and into the future. An interesting question is are they born, or do their experiences shape them or some combination of these factors?

    S Shyam, I think greed can factor into the equation for some leaders, my experience has been these are a minority (varies by industry). I believe businesses must be profitable (otherwise there is no way to reinvest, grow, add value, improve, return funds to investors etc) but leaders need to understand where that profit comes from and that it is as a result of creating value for customers rather than extracting value from customers (some businesses are good at this but I don’t see it as sustainable unless they have monopolistic power).

    Mohamed thanks for your thoughts, I would be interested to see your paper!

  9. Accurate observations, Chris. Besides fear standing in the way is myopia: short-sighted views and business-as-usual contentment. I’m a stickler for logic. Logic says follow the money. It doesn’t really come from investors, ultimately. Investors want to be paid by revenue generated by customers. The buck stops/starts there.

    Wouldn’t it be great if all our managerial rituals started with “what’s in it for the customer” and “how congruent is this with our customers’ goals”? Managerial rituals are what we do to run the business, aside from making, selling or delivering the product, e.g. hiring, reviews, budgeting, meetings, etc.

    In healthy families, equivalent rituals tend to consider “what’s in it for each family member” and “how congruent is this with our family’s goals”? This precedent and contextual decision-making can be applied to managing a business. Unfortunately we’ve grown accustomed to using similar context with investors as the focus, while customers are the horse that pulls the cart, in reality.

  10. Great article Cristopher! I agree that fear is in most cases the main obstacle to becoming truly customer-centric. However, sometimes it’s leaders’ cluelessness that holds them back. I saw that at many businesses that wanted to scale: they knew exactly how this process should unfold, but somehow always missed one “little” thing. They never thought of how this would really affect their customers. I think this happens when leaders have been running the business in a certain way for a while, so they get a little too comfortable and forget their customers do not necessarily feel this way.

    So, in my opinion, great leaders are always up for a reality check – and never get too far from the world their customers live in.

  11. Great points Lynn thanks for weighing in! It all begins and ends with the customer.

    Julia, it is funny how customers can become an afterthought… On your last point, I agree that is a key difference – great leaders never allow themselves to become too distant from what is happening on the ground.

  12. Hi Chris,

    Hope my response isn’t coming too late.

    I agree with your title but I don’t agree with your content.

    There’s an inconvenient truth “Why most leaders say they want their businesses to be customer-centric but aren’t willing to take the first step”. However, it’s NOT because of CEOs ‘fear’; the inconvenient truth is: CEOs ‘suspect’. In my view, CEOs have two suspicions:

    1. Does “Obsessed with Customer” Equal to “Obsessed with Customer Interactions”? The common definition of customer-centricity is “putting the customer at the center of everything you do”. And most CX experts interpret customer obsession as “obsessed with customer interactions”. CEO’s may not agree with this biased and narrowly-defined interpretation.

    2. Is ”Just do it” Sufficient to Justify a CX Transformation? CX Transformation is too expensive – time, manpower, and financial – to many companies. “Just do it” maybe a good attitude in sports. However, unless you own 100% of the company with no other shareholders, it’s a dangerous mentality and an irresponsible behavior. Sensible and responsible CEOs are unlikely to “Just do it.”

    I’d love to hear your thoughts.

  13. Hi Sampson, great points thanks for sharing.

    1. Obsessed with customers is about being obsessed with customer value rather than interactions, it is a more holistic approach. The interaction is one component.

    2. I agree CX Transformation on an enterprise-scale is a massive undertaking, only those that have built a business case that connects customer behavior to business profitability will invest. I have worked with several large telcos that have made those investments and been very successful in shifting the organizational mindset and operations.
    However, there are benefits that come from simply looking at the business from a customer perspective and generating a more customer-centered mindset that does not require massive investments. I am advocating for this shift in the way business leaders think about doing business. When you change your thinking you change your behavior and that does not necessarily require a massive investment.

    What has been your experience?

  14. Chris,

    Thanks for your prompt reply.

    Personally, I truly appreciate the original noble idea of customer-centricity (as you said, obsessed with customer value) and admire the passion of customer-centric enthusiasts.

    You are right – “Obsessed with customers is about being obsessed with customer value rather than interactions.”

    However, similar as CRM should be a business strategy, NOT software; customer-centricity should be “obsessed with customer value” NOT “obsessed with customer interactions”. Look at who are the most praised customer-centric brands: Amazon, Apple, Starbucks, Virgin Atlantic and Zappos. All of them “serve customers well”. Brands merely focus on pricing or product would never on the list.

    You are right – “When you change your thinking you change your behavior and that does not necessarily require a massive investment.”

    However, when the industry norm of customer-centricity is still “obsessed with customer interactions” and the solution is always to take a CX transformation, I will hold my argument: “Just do it” is a dangerous mentality and an irresponsible behavior.

    Chris, how can we change the status quo of customer-centricity?

  15. While I agree with everyone, most people think customer centricity is difficult. It is not. It is a mind set.
    First, we need to work on things that cost the company nothing but a mind-set. Smiling, doing the right thing do not cost anything, but we don’t promote these.
    Let us start with the simple stuff and the rest will fall in place.

  16. Hi Cyrus,

    Let me explain why “obsessed with customer interactions” is not a good idea.

    1) Obsessed with Customer Success

    Joseph Michelli, chief experience officer of The Michelli Experience, “Customer-centricity is a commitment or a strategy to assure the success of your customer.”

    Michelli’s definition may not be the perfect or ultimate one, but it’s much closer to the original intention of customer-centricity – creating values for customers / helping customers achieve their desirable goals – than the most common definition “Putting the customer at the center of everything you do”.

    Though none of the CX experts would admit, most of them interpret customer obsession as “obsessed with customer interactions”. It’s not right.

    2) For All Companies

    It’s a strong belief that companies have to take a CX transformation in order to be customer-centric.

    This “Serve Customers Better” approach generally includes (the terminologies might differ, but their meanings are similar): culture transformation, emotional engagement, employee engagement, and service improvements.

    Customers have different needs / wants – e.g. inexpensive prices, prestige feeling or great products – not only good services. It makes NO sense to take a CX transformation – bearing its huge manpower, time and financial costs – if the competition strategy of your companies isn’t service-focused.

    Every company, no matter big or small, whatever your focus (pricing, product or service), can be customer-centric as far as they help customers achieve their desirable goals. It’s not merely for a minority of companies.

    3) Drives Repeat Customers

    CX pros have long been criticized for failing to achieve business results. But they are innocent.

    CX pros believe that what they are doing is driving business results. Industry experts and authorities keep on telling them “improving customer experience will improve business results”.

    It’s untrue. Because when customer experience is always referred as customer interactions, improving customer interactions may create “happy customers” but not necessarily repeat customers.

    On the contrary, when you help your customers obtain their objectives, it drives business results – acquisition (first-time purchase) and retention (repeat purchase).

    I strongly believe “obsessed with customer success” is a better option than “obsessed with customer interactions” in driving CX success and transforming more companies to be customer-centric.

  17. One of the first places to start with any company/leader interested in customer-centricity is to define what that term means in *that company*. Since there is no agreed-upon industry definition.

    CustomerThink did study this question in 2014 and found
    * Most believe that customer-centricity is about creating loyal customers, and that doing so should also create shareholder value. It is not just about “being nice” to customers or “putting customers at the center.”
    * Respondents strongly rejected the notion that customer-centricity means just doing whatever customers ask, that employees don’t matter, or that customer-centricity is the only factor in business success.
    * Two-thirds *disagreed* that customer-centricity is mainly about customer interactions, not products or pricing.

    Customer Experience (CX) has been positioned about improving “interactions” from the beginning. But what is an “interaction”? CX thought leaders define interactions so broadly it means anything including product, price, brand, etc.

    Regardless of industry definitions, according to CustomerThink’s 2018 study, most CX initiatives are actually focused on touchpoint or process improvement, only rarely about products, and never about pricing. However, more recent research (not published yet) suggests B2B companies place a higher priority on products in their CX efforts.

    I don’t think another industry debate about what these terms mean is all that productive at this stage. Instead, spend time internally debating and agreeing on what is included, or not.

    I do agree that customer success is a good way to describe the goal of customer-centricity. And perhaps CX, too. If you focus on customer goals first, then it would lead companies doing whatever helps customers achieve those goals.

    In any case, I don’t think it changes the fact that the CEO and senior leaders need to be obsessed about delivering the value customers care about. Call it whatever you like, just do it!

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