So you want to be customer centric?

So You Want to Be Customer Centric?A Futurelab Action Guide

FUTURELAB

Alain Thys, December 2010

About this presentation

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“Customer centricity is a journey. This presentation

offers you some guidelines for the first few steps.”

Prelude

Most herald the same brilliant companies as examples.

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There are many great books, articles and presentations about customer-centricity


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What do you do if you live in the real world ?

In most large organisations:

• CEO’s don’t wear turtlenecks or fly balloons.

• Silos, habits and politics get in the way

• Thousands and thousands of people need convincing

11-28% of customer questions NEVER get answered In the real world

Source: Insites Consulting survey of 500 senior marketers in Belgium, Netherlands, France, Germany and Great Britain

But while best practice and academic models can be inspiring, life often doesn’t reflect the reality they portray.


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Five steps to make your business (more) customer-centric


Futurelab associates have been involved in over a dozen customer-centricity programmes involving tens of

thousands of employees across each continent. This action guide brings together the pragmatic lessons learned.

#1 Understand it’s a mindshift game

#2 Show them the money

#3 Make the customer voice actionable

#4 Pick your battles carefully

#5 Build a movement

Understand it’s a mindshift game

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“By doing more of the same, you won’t get a different

result. You need a new perspective.”

Step #1


While useful, too much customer thinking starts with the tactics

• What is the best metric to use?

• Which CRM software best meets our need?

• How do we improve first call resolution time?

• Which customer methodology is most suitable?

• What social media tools should we use?

• Which questions should we ask our customers?

• How can we benchmark ourselves?

• ...

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When the chips are down, most

companies choose shareholder value

over customer value any time.


But by doing so, they avoid the elephant in the room

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Reality Check

Sorry my friend, but

customer happiness

doesn’t buy you much on

Wall Street.


Much of the well intended customer rhetoric misses the point

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The customer evangelists say:

• We owe it to our customers

• Customers pay our salary

• We will lose our competitive edge

• It’s important

The business hears:

• This may cost money

• This will upset the status quo

• I’m already busy enough

• Yes, this will cost money

DON’T: BE A CUSTOMER CARE BEAR

Even if this is your driver, don’t talk about

customer-centricity in terms of morality or

long term gains.


STEP 1: Change the way customer-centricity is perceived

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DO: TAKE THE FINANCIAL PERSPECTIVE

If your company only really cares about the

money, talk about the profits that can be made

from being customer-centric.

Show them the money

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“Saying that happy customers are more profitable

isn’t good enough. You must prove it.”

Step #2

Show them the money

Traditional satisfaction metrics aren’t boardroom proof

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Customer satisfaction is no

guarantee for loyalty, repurchase

or other forms of “new profit”.

• In spite of standing ovations, churn rates among

concert goers of 55% are not uncommon (OW, 2008)

• Upto 80% of customers that left a given ISP declared

they were satisfied in the 12 months before they left

(Mercer, 2004)

• 60-80% of “lost” US banking customer described

themselves as satisfied in surveys just prior to

departing (Brandchannel, 2010)

• There is no relevant correlation between satisfaction

and market share (AT&T/Gale Consulting, 1997)

Show them the money

Newsflash: People pay to be satisfied

Where satisfaction works

Satisfaction measures are very useful to

check whether people received what

they expected.

Where satisfaction breaks down

There is no hard business case for

satisfaction alone.

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When was the last time you voluntarily

bought something with the explicit

expectation not to be satisfied?

Show them the money

You need a metric that correlates with economic behaviour

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0 1 2 3 4 5 6 7 8 9 10

Extremely

unlikely

Extremely

likely

NPS™= (Promoters-Detractors)/Total

DETRACTORS PROMOTERSPASSIVES

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, and Fred Reichheld.

Show them the money

And express this in terms your business can appreciate

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The more likely customers are to recommend, the more profitable they become

0 1 2 3 4 5 6 7 8 9 10

Investment: the cost of making customers more likely to recommend

Your Business Case

Return: the gains from the altered economic behaviour

Promoters:

• buy more & more often

• are more loyal

• negotiate less

• are easier to service

• bring their friends

• ...

= are more profitable

ROI for decision making

DON’T: GET LOST IN SATISFACTION LAND

Customer satisfaction is a useful measure, yet

does not meaningfully contribute to the

financial impact of customer centricity

Show them the money

STEP 2: Make a business case for customer-centricity

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DO: ESTIMATE THE ROI

Look at actual economic behaviours from

different customer types to build a business case

with a measurable ROI.

Make the customer voice actionable

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“All this customer information is interesting, but what

does it mean to ME?”

Step #3


Customer voice data & market research are often distant

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While containing extremely valuable data, traditional customer survey and voice-of-customer

programmes are often too complex or abstract to inspire executive action. Even those that

wish to act often need to wonder what all this interesting data actually means to them.


Bring the customer’s voice into the business, literally.

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How often do members of your

executive team actually meet

and talk to real customers?

Don’t

Show a graph saying that

9% of your customers are

highly dissatisfied.

Provide abstract graphs on

aspects customers like or

dislike about your service.

Summarize verbatims into

generalised statements.

Do

Play a video of 27 customers

saying how your business

“sucks” (and why).

Bring a dozen customers into

the business and have an

executive conversation.

Have your teams go through

every individual verbatim.

NPS Tip

If you ask people about their likelihood to recommend, simply asking them one

or two more questions on their reasons and the opportunities they see for you

to improve, can give you a wealth of information.


Create a cross-functional platform for action

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Fact

Customer’s don’t care about the way you

are organised. Acting on their voice may

break through every silo you have built

and challenge every orthodoxy or KPI

your business believes in.

Set up cross functional meetings and action mechanisms at every

level of the organisation, to directly listen to the customer’s voice

and establish multi-department action plans.

Establish an alert system that ensures you keep going until every

touchpoint gets it right.

DON’T: RELY ON ABSTRACT OBSERVATIONS

Executive teams have become too distant from

their customers. This is only worsened by abstract

research and VOC programmes.


STEP 3: Bring your customer into your business

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DO: REALLY LISTEN AND ACT

Bring the customer’s voice really into the

business and listen to it across silos. Then act

on what you hear.

Pick your battles carefully

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“The goal is to make change happen, not to become

a customer martyr”

Step #4


This is not a walk in the park

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Many companies have attempted –

and failed – at integrated customer

programmes.

The ride can be rough.

Some of the hurdles you will encounter:

• Disbelief in de customer value numbers

• Extensive debate about the validity of your data

• Silo-based myopia

• Structural/political opposition

• Data being interpreted wrongly

• Project hijacking

• “It’ll pass” behaviour

• Outright cynicism


Start with a pilot project

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Gain (private)

executive

sponsorship

Test your

assumptions

in a pilot

Refine &

test

again

Announce

to the

world

No two customer centricity projects are ever the same.

This means you are bound to make mistakes.

Don’t start running before you can walk.


Balance quick wins with structural improvements

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Time

€Im

pa

ct

Quick wins

Structural

improvements

Understanding the future

buying behaviour of your

customers allows you to

devise sales strategies

which generate short and

long term wins.

Even if you get people to

commit to a long-term

customer strategy, there will

be a point where some get

impatient and want to see

results.

Make sure they get them by

securing a few quick wins.


Be patient and pragmatic

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You will not be able to make your

company customer-centric

overnight. In fact, the process

may take years.

So don’t be too quick to judge the

organisation against absolute

standards, yet consider the

progress that is being made.

DON’T: BLINDLY CHARGE AHEAD

Your business will not benefit if you become a

customer martyr. Don’t announce big programmes

or changes before you’re ready.


STEP 4: Move with utmost deliberation

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DO: ACT WITH RESTRAINT

Build your customer case in a way it becomes

impossible to ignore or discredit. Manage

expectations along the way.

2/01/2011 28

Start a movement

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“Customer-centricity cannot be conscripted. You

need to light the fire, and get out of the way”

Step #5

Start a movement

Customer centricity: it’s all about the people

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DO YOUR PEOPLE WANT TO BE CUSTOMER CENTRIC?

Willing: Do they want to behave in a customer-centric manner

Skilled: Do they have the knowledge and practice to do what is right

Able: Can they do the right thing, or does the business get in their way

You will face three types of people in your business:

Those that actYour primary focus

Those that waitGently encourage

Those that hinderEliminate or ignore

Start a movement

How to start a customer movement

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http://www.youtube.com/watch?v=fW8amMCVAJQ&feature=related

Start a movement

In practical terms: success will generate success

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1. Identify those who already behave in the right way

2. Get their support for your bigger objective.

3. Find champions at all levels in the business

4. Help them be successful as well

5. Highlight these successes to the organisation

6. Attract more supporters

DON’T: FIGHT FUTILE BATTLES

Not even the CEO can change an organisation

alone. Don’t waste your energy and resources on

trying to move things that are too strong.


STEP 5: Start dancing

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DO: BE A REAL LEADER

Set the example that you encourage others to

follow. Help them in their efforts and use their

success to build a movement.

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Five steps to make your business (more) customer-centric

To Conclude

#1 Understand it’s a mindshift game

#2 Show them the money

#3 Make the customer voice actionable

#4 Pick your battles carefully

#5 Build a movement

And if all the above is too ambitious, just step out of your office and meet a customer.

Hi there,

If you have made it this far in the presentation, customer-centricity is

probably on your mind. So perhaps we should talk.

Futurelab’s 30+ associates have been involved in over a dozen

customer-centricity programmes involving tens of thousands of

employees across each continent.

This makes them perfectly placed to assist you in your customer-

centricity efforts. Not with complex methodologies and theoretical

advice, yet with pragmatic recommendations rooted in experience.

So if you feel you’d like to have an informal chat about the ways we

can make your business more successful, please do get in touch.

Alain Thys:

Email: [email protected]

Twitter: @FLB_alainthys

Stefan Kolle:

Email: [email protected]

Twitter: @FLB_stefankolle

FUTURELAB

A world-class team that believed in customer-centricity before the word existed.

A moment of self-promotion