What does it take to drive a top-down plan for customer-centricity?
COLLOQUY Staff
Through a special arrangement, what follows is a summary of an article from COLLOQUY, provider of loyalty-marketing publishing, education and research since 1990.
To effectively establish an enterprise-wide customer-centric mindset, change management is the key, and change management initiatives work best when driven from the C-suite, according to Clay Walton-House, who leads the customer retention and loyalty practice at Lenati.
“The C-suite needs to make the case for change,” said Mr. Walton-House. “Customer-centricity can tie directly to profitability — and employees need to be aware of that connection. It’s crucial to engage all departments, especially those with limited or no customer contact.”
The top-down approach, according to Mr. Walton-House, offers specific benefits:
- Streamlined approvals. At the management level, approvals must typically be obtained both vertically from supervisors and horizontally from peers in other departments. The C-suite can bypass potential obstacles in navigating the organizational chart.
- Clarity of message, since the directive comes from a single authoritative source.
- A sense of priority and urgency, because when organizational leadership points the way, employees are motivated to follow.
- Faster acceptance by employees, as they follow the strategic direction from the C-suite.
He said three key action steps help ensure successful change: defining, measuring and implementing.
“An explicit, clear-cut definition of customer-centricity ensures enterprise-wide consistency and enhances employee buy-in,” said Mr. Walton-House. “From senior leadership, this requires an explanation of what customer-centricity means in practice and how the principles apply specifically to the organization.”
Measurement criteria should move from product-driven metrics — such as units produced, units shipped or sales volume — toward metrics like customer lifetime value and share of wallet. Said Mr. Walton-House, “Setting up this type of measurement reveals where opportunities exist at the customer level — not the product level — which is the essence of customer-centricity.”
Finally, implementation involves linking employees to specific tactics that pertain their areas of responsibility.
“Throughout the process, employees need reinforcement — not just slogans, but reminders of why it’s important and their role in its success: ‘Here’s how you influence customer value, and here’s how you can increase it,’” said Mr. Walton-House. “Tying customer-centricity to the bottom line, regardless of department, makes the message both meaningful and impactful.”
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19 Comments on "What does it take to drive a top-down plan for customer-centricity?"
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Founder & CEO, ReturnLogic
It takes a bottoms-up approach. Companies can’t suddenly decide to be customer-centric — it is ingrained in the founding DNA. That is the reason Walmart.com could never compete directly with Amazon in terms of the customer experience. Walmart finally realized this and purchased Jet.com in hopes to close the gap.
And that’s the power of being truly customer-centric. It must be authentic and can’t suddenly be decided in a board room.
Global Retail & CPG Sales Strategist, IBM
You know, talk is cheap. We have done research that shows 80+ percent of CEOs say they’re customer-centric, while 80+ percent of their customers feel the brands don’t understand their needs. The creation of awareness, (both internally at the organization and externally with customers) of the brand’s customer-first approach needs to be executed with a relentless, consistent drumbeat of communication. Leaders must exhibit this focus in a genuine way that gives credibility to the effort. Then staff will believe in the culture.
Professor, International Business, Guizhou University of Finance & Economics; Executive Director, Global Commerce Education
Gordon Bethune, former CEO of Continental Airlines wrote “From Worst to First.” It is this story precisely. How to make a company with tens of thousands of employees customer-centric. I recommend it to any CEO who is serious about implementing customer-centricity. I use it for my leadership students.
The steps:
President, The Ian Percy Corporation
Bethune’s book sounds well worth reading, Gene. Thanks. On point two about “measure, measure, measure,” I’m hoping “They aren’t what you think” alleviates my concern about being strangled by metrics. If management tries to measure the behaviors of those who, naturally out of their own heartfelt beliefs, truly put the customer first, and then turn those behaviors into an obligatory employee training program, I predict failure. Nothing kills love faster than trying to measure it and make people do it.
To be clear, this is not an anti-measurement sentiment. We just need to measure the right things.
Professor, International Business, Guizhou University of Finance & Economics; Executive Director, Global Commerce Education
The key is to measure the results, not the activities. Are we meeting the KPIs, which are very different than revenues, margin and profits? For Continental it was such things as on-time performance and lost luggage. Things that were critical to the customers’ decision to choose one airline over another — or one retailer over another.
Managing Director, StoreStream Metrics, LLC
Being customer-centric means that your customer-facing employees are empowered to do the right thing for the customer that is standing right in front of them at that moment. All too often employees operate out of fear and indifference and only recite policies that were created by lawyers and corporate MBAs to protect the company rather than help the customer. Empowerment relies on trust and respect — and corporate board rooms have little use for these traits in responding to Wall Street.
President, The Ian Percy Corporation
“…corporate board rooms have little use for these traits in responding to Wall Street.” You sure have that right Adrian! Well said.
President, Max Goldberg & Associates
Every organization talks about being focused on the customer, yet few are nimble enough to pull it off. There must be a mindset of challenge and change — challenge to constantly find what consumers want and change to rapidly implement those desires. Management needs to model the behavior it wants from all employees. It needs to hire change agents and adopt a willingness to try ideas suggested by them. And management needs to create an atmosphere where innovation is encouraged and accepted.
Chief Amazement Officer, Shepard Presentations, LLC
President, Global Collaborations, Inc.
Implementation is the challenge. Training employees, at every level, need to understand how a consumer-centric approach affects their job, access to relevant information and the resources necessary for action. In addition, new metrics need to be used to evaluate success and care needs to be taken to link metrics with desired results. If either of these steps are ignored or not fully implemented, the change will not happen. This is not a journey for the faint of heart or a decision that can be ignored once made.
CEO and President, Walking TALL Training & Consulting, Inc.
What is missing here is exactly how you engage employees to change their mindset. This is frequently the element missing in this type of initiative. I agree with the statement ” … employees need reinforcement — not just slogans, but reminders of why it’s important and their role in its success.” However, “reminders” are not enough. Personal development training needs to be provided that enables employees to be crystal clear about their value, then to be consistently respected and valued by their line managers and be empowered to do what is needed to truly be customer-centric in their own authentic way. This is the “what’s in it for me” factor and this will get results.
President, The Ian Percy Corporation
CEO, rDialogue
There’s no doubt that customer-centricity starts at the top: not just the C-suite, but the CEO and ultimately, the board. We see many clients (companies) where there is a shift to customer centricity — including from some of the world’s great brands — but too often it’s nothing more than lip service or messaging.
For customer-centricity to be genuine, it means that the company’s business strategy includes the customer as a top priority. By our assessment, this prioritization means that the customer commitment is a top-3 or at worst, a top-5 priority within a company’s business plan. This type of commitment means it’s measurable, and talked about not just internally but externally. The external communications are essential and ensure accountability from shareholders and Wall Street, the ultimate scorecards (for public companies).
Global Managing Director, Prosper Business Development
President and Managing Partner, Sixth Star Consulting
Good stuff. This is great in theory, but most companies don’t bring it down very well from the clouds to the ground level. That’s why I believe one of the biggest areas of focus needs to be turning customer-centricity into specific behaviors and actions for frontline employees created by frontline employees. It’s more than a training. It’s a new way to engage, serve, and likely sell the customer.
Title Question: “What does it take to drive a top-down plan for customer-centricity?”
Q1: What do you see as the main hurdles?
Q2: What are the overlooked steps toward creating a customer-centric organization?
Q3: How do leaders most frequently lose focus?
Founder & CEO, Dextro Analytics
A culture shift is the biggest hurdle for any change — analytics, customer-centricity, and change management. Talking the talk is not sufficient. Show financial impact to C-suite. Reflecting from past engagement, combining organization data and building model that quantifies impact of customer experience and centricity are the sure fire way to walk the walk. When you can show impact of customer centricity efforts on sales and revenue, you no longer need to do any convincing.
Director, Alvarez & Marsal
While a top-down direction is critical from an executive sponsorship perspective, as well as driving overall corporate change, those closest to the customers will provide the insights and direction in order to be successful. Executives certainly could provide the overall leadership and company culture, however, it’s those who are on the operational side of the business, and who actually interact with the consumers, who could be the most impactful.
A bottoms-up approach could certainly help drive insights about the most loyal customers.
Companies could ill afford to make any missteps with the customer experience, as:
1. The choices for the consumer are vast;
2. Consumers have greater authority over the shopping journey;
3. Friction = lost customer loyalty and business;
4. Critical to driving a superior customer experience, are leveraging the measurable and tangible analytics, KPIs and insights that are not so apparent from an executive level.
CEO, Motista