I’ve read many papers, blogs and articles telling me what being Customer Centric is all about. I agree with most of them when they provide lists of the differences between the product centric and the Customer centric organization. I also like more recent views that we are in need of a more balanced network centric approach, taking all stakeholder interests and roles in the value creation process into account, although I feel many continue to overlook the (importance of the) Customer’s role in that process. But this is not the essence of today’s post.
The importance of boundaries
My issue with the many views, explicit or implicit, on Customer Centricity, is that they always seem to tell you what you need to stop and start thinking of or doing, but they hardly discuss or let you know where the boundaries are. Or at least discuss the notion of boundaries and their importance.
As a result many organizations get stuck in Voice of the Customer programs because they do not know how to handle the abundance and variance of feedback they collect, exhausting their resources with too many things to focus on and too little meaningful results, for Customer and company. And as a result Customer Experience programs turn into action plans or campaigns trying to create a Disney-like WOW-experience on every touch-point or even create completely new ones where “old” ones continue “as is”. And as a result many continue to try please every (potential) Customer with a big enough wallet to come through the door and then throw away the key. And, last but not least, many continue to think it is important to exceed Customer’s needs, whereas the rise of the mini-laptop, among others, prove otherwise.
4 Constraints to take into account
Thus, we are in need of boundaries or constraints, to prevent us from being ineffective. Here are some constraints I’d like to take into account:
- (Social) CRM tells me we need to focus on Customers with the highest (potential) engagement value
- Customer Experience Management tells me we need to focus on the touch-points that contribute significantly to both Customer’s and company’s desired outcome
- Service Dominant Logic tells me to focus on Co-creation of Value-in-use, for which “Customer jobs-to-be-done” is a good proxy
- Lean start-up thinking tells me to get out there to test our hypotheses (or assumptions) to prevent late failure
My own logic tells me I need these constraints to prevent me from wasting my resources and/or capabilities, because I firmly believe wasting my resources will ultimately result in wasting my Customer’s resources (be it time, money, effort etc.) as well. And that, I believe, is far from Customer centric.
What are your boundaries to Customer Centricity?
While reading this post I realized possible boundaries to Customer Centricity from data management point of view. All the company knows about customers is kept in CRM and transactional data. Most CRM are product centric , what explains that marketing is organized around products and to some extent around customer demographic data. Very important aspects of customers such as lifestyle, behaviour patterns, opinion, insterests (psychographic data) are more difficult to model. However I see very good indications and cases that this is the way to proceed within database marketing community. The management can argue how to proceed but unless there is data your hands stay twisted.
Data for sure is an important constraint. Not only because of data not being there, but also because it is not always easy to gather it and then to turn it into actionable insights.
On top of the product/transaction/demographic data and psychographic data, I also think contextual data (e.g. previous steps in the Customer journey, location etc) and network-data are becoming more and more important to fully understand the Customer..
But, many insights can come from faily easy observations and usage of data that is available. The most common mistake I see in these kind of effort is that people think they should wait until the systems are in place and the data is available.. Mostly not more than an excuse not to have to move.. And missing out on all the fun doing so..
Thx for stopping by and hoping to se you back here soon!
Thought provoking and I agree, to tackle a problem that can be as unbounded as instilling customer centricity throughout an organization, starting with well structured parameters is critical.
One potential shortcoming I see is that the companies struggling w/ the larger issue of customer centricity almost certainly have struggles with some, if not all, of the parameters you suggest.
In particular, these companies often don’t know who the customers with the highest potential engagement value are, and don’t have a good grasp of those touch-points that contribute to Customer / company desired outcomes.
So my question is this: does a company need to start by developing an understanding of these underlying issues first before even engaging in any voice-of-consumer initiative? Is understanding these parameters a necessary step in all cases, or could other parameters / proxies be used?
From what I’ve experienced, these seem to be more the stumbling blocks – that most don’t have good inputs & understanding to even define the problem.
Thx for stopping by :)
With regard to your question I would say that thinking through the above perspectives is a good starting point of a Voice of the Customer initiative, because we do not want to listen to all Customers.. We listen to those we can really help with the best of our (limited) capacity and capability.. Imho it is not only about limiting your actions, but limiting your entire focus on where it matters most..
That’s not bringing in stumbling blocks.. That’s removing them..
You bring out a point often ignored in the business world – the execution of a customer-centric (or focused) approach. Customer focus or customer-centric does not mean being plugged into all your customers, even though that is precisely the mental-model many have in their minds when they think about those terms.
I like the constraints you listed in your post. Understanding these and working your way around is definitely one approach to execution. Another would be leveraging analytics & segmentation. Some folks might not agree with me but analytics along with segmentation is a powerful way to determine how to expend your resources for the max ROI and providing the max impact value to the customers (including the most relevant touchpoints for the various customer factions you might have). Also, an often forgotten part in all this is the process, infrastructure & culture – to make the customer happy, the firm has to be “wired” for it.
Eventually, customer-centricity in its true-form is channel agnostic and requires us to have a fluidity in our thinking different from what we were used to in the past. Irrespective of which channel/touch-point the customer uses, the firm should be ready to ‘make-it-happen’ for them (whatever they are trying to do – research, transaction, customer service etc.). Understanding this mind-shift would go a long way in how we can enhance the experience and value for both parties.
We seem to be on one line again. Analytics (for segmentation, regardless if it’s Customers, Touch-points and what have you ;) is the aorta of the first 3 bullets in my 4 bullet list..
Nothing more to add. Gr8 comment & thx for the shout :)
Hi Wim, Thx for your reply. Yes we indeed agree mostly. I was not clear enough. I mean focus on your best (top 20%) products – the ones that give you the most profit and are most important for your brand. A lot of companies have too large assortments and sell products and services few customers want and they have to service them also. Clean them up would be my suggestion.
I have a lot of blogs in mind. So we’ll see.
Valid points, contraints are necessary. Though I would call it customer focus and not centricity. I would also change some of your points and add one – focus on your (best) employees. So from a CEM perspective this is what we do:
1. Focus on your target customers (highest value / highest engagement) and their needs and expectations (point 3 included)
2. Focus on the touchpoints most important for customers AND the brand
3. Focus on your most important products
4. Focus on your best employees
5. Validate the designed brand promise and experience
6. Keep Lean away from customer processes
Great to have you here & thanks for your contribution to the discussion.
I think at large we agree and I’m grateful you added the Focus on best employees. What goes for Customers, most certainly also goes for other stakeholders, and employees are among the most important ones (some even say more important than Customers)
I think your point 1 and 2 are the same as my first two “dots” and your point 5 is exactly the point of my last “dot”, so we agree on 3 out of 4 at least. A good start ;)
With regard to you point 3, I’m not sure I fully agree, or at least it leaves me with the question what happens when your most important Customers (by their engagement value) do not buy your “most important” product). Maybe you can help me out here?
And we do agree we should keep lean (and 6sigma for that matter) away from Customer processes, at least to the extent that they are only about trying to manage away variance, not absorb it.. but that’s also a completely different topic, worthy of a separate post. Maybe you want to write it?
Profit-centricity is another boundary of customer centricity. I’m not saying that companies should not make profit, but if they really care about customers, they should be ready to accept lower profits and invest in people and tools to improve the relationship with their customers.
This can build loyalty and will bring more profit in the future. Unfortunately, many companies only put the customer in the center because they know they’re not going to sell anything to unhappy customers. But if they could, they would, and some even do it.
Thx for stopping by and taking time to comment! And I agree with you that companies should be willing to seed before they can harvest.
Your second point opens up another interesting element to the discussion that I will not pick up on this occasion. That’s a entire post in itself. Maybe you care to write it?
I think it’s a very valid point you make as well as a great starting point for organizations and people to understand that hype will only hinder the value that comes from such initiatives.
We don’t want to burst bubbles anymore rather lay solid foundations.
Thx Spiro, for reading and the nice feedback! And thx for kicking off the comments, because it only takes one to get more!
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