Customer centricity is a way of doing business and a way of thinking that focuses on customer needs and is committed to creating a great customer experience. The goal is to provide customers with great experiences at each step of their journey, by focusing on what they need, their preferred means of communication and interaction.
Sounds very logical doesn’t it? – Of course, customer experience and customer service should be very important. Unfortunately, this is not always the case in practice. When it comes to way of doing business and a way of thinking, the culture of the company becomes a key success factor. As Peter Drucker once said, “Culture eats strategy for breakfast” and we see how valid that is in many cases. Culture is about “how things work” in an environment. Although a new strategy may define many changes on paper and describe the ways that will make the company more successful in the future, the unwritten rules of the company determine whether to use these new ways. These unwritten rules, no matter how clearly and clearly the strategy is expressed, determine the result. So it is not about the instructions but the habits of the company that matter. For this reason, creating a customer-centric organization actually describes a cultural transformation and requires a lot of effort, contrary to what is believed.
Achieving this transformation is undoubtedly difficult, but not impossible. We all have read case studies of companies such as Amazon and Apple, which are successful examples of this transformation. We frequently see/listen to similar stories in LinkedIn articles and/or conferences. So, what are the key success factors for a customer centric organization that every customer experience professional dreams of?
- A strong customer experience team: Since customer experience requires the joint efforts of all departments in the company, establishing a strong customer experience team to coordinate these efforts and guide the company’s customer experience strategy should be the first step of transformation.
- Action-oriented cultural transformation program: Many customer experience transformation programs remain on paper because they are not designed properly. In order to unite individuals in the organization around a common goal and to make them believe in this vision, it is very critical that the transformation program generates actions that contribute to customer experience scores.
- Employee engagement: The happy employee and happy customer equation has proven itself now and then in every sector. A company that does not take good care of its employees cannot take good care of its customers. Therefore, the commitment of employees at all levels of the organization to the company and its vision is one of the important success factors of any transformation program.
- Effective communication: One of the most important building blocks of change management is effective and healty communication. Transparently explaining voice of the customer as well as actions taken and results achieved to employees in the organization plays a critical role in transforming into a customer-centric organization.
We will be studying all these key success factors as individual topics over the next 4 weeks.
Webinar: The Future of Retail and Customer Experience
Covid-19 crisis and the evolving customer behaviors have forced many retailers to adapt to mandatory shifts. These uncertainties disrupted the industry and have pushed retailers to reorganize. The already digital-savvy companies were able to make these shifts relatively easily and, most importantly, seamlessly for the customers. MediaMarkt is one of these companies. They were able to transition their stores, adapt customer journeys and createa safe and engaging work environment by adapting to their employees’ and customers’ needs.
Yenal Gökyıldırım, CEO of MediaMarkt, talks about how the company adapted to these uncertainties and shares his view on the future of retail and customer experience. In our new Industry Leaders webinar, Çağlar Göğüş, CEO of Doğan Holding, our moderator for this recording, asks critical questions to unveil the underlying reasons for MediaMarkt’s success.
Here are some of thediscussion topics:
- Why is customer experience important, and why should it be integrated within the company strategy?
- How did Covid-19 and evolving customer expectations shape the future of retail?
6 Ways to Build a Customer-Centric Culture
Companies have been trying to adopt customer centricity for nearly 20 years now. But the CMO Council reports that: “Only 14 percent of marketers say that customer centricity is a hallmark of their companies, and only 11 percent believe their customers would agree with that characterization.”
Why do so many companies struggle to get customer centricity right? The volume, velocity, and variety of customer data overwhelm many organizations. Some companies don’t have the systems and technology to segment and profile customers. Others lack the processes and operational capabilities to target them with personalized communications and experiences.
But the most common, and perhaps the greatest, barrier to customer centricity is the lack of a customer-centric organizational culture. At most companies, the culture remains product-focused or sales-driven, and centricity is considered a priority only for certain functions such as marketing. To successfully implement a customer-centric strategy and operating model, a company must have a culture that aligns with them — and leaders who deliberately cultivate the necessary mindset and values in their employees.
To build a customer-centric culture, business leaders should take six actions:
Operationalize customer empathy. Empathy is one of those buzzwords that sound really good, but very few companies actually understand what it means, much less practice it. Essentially, customer empathy is the ability to identify a customer’s emotional need, understand the reasons behind that need, and respond to it effectively and appropriately. And it’s pretty rare. According to PwC, only 38% of U.S. consumers say the employees they interact with understand their needs.
To install empathy as a universal value, one that guides everything their organization does, leaders must do more than giving it lip service. Slack, the business communication software company, operationalizes empathy. Employees spend a lot of time reading customer messages and observing customers to intuit what they want and need. Customer support specialists are encouraged to research the people they’re helping and create mini personas for them to better understand how the customers are using Slack. The company screens for support people who know how to express empathy through the written word, and the company doesn’t allow them to cut and paste canned responses. And for partners who build apps on the Slack platform, the company promotes nine best practices to help them practice empathy, including “outline your use cases” and “storyboard each interaction.”
Hire for customer orientation. From the very first interaction with prospective employees, organizations should make it clear that thinking about customers and their needs is a priority. At Hootsuite, the social media management platform, marketing and human resources executives collaborate to do this.
During the interview process, hiring managers are required to ask every candidate, regardless of role, a question to gauge their customer orientation. Kirsty Traill, the company’s VP Customer, explains that this practice not only assesses candidates and ensures that every new employee is aligned with customer-centric thinking, but also sends a clear message to everyone — recruits and hiring managers alike — about the importance of customer experience at the company.
Democratize customer insights. For every employee to adopt a customer-centric mindset, every employee must understand the organization’s customers. Adobe Systems has opened up access to customer insights for all employees. It doesn’t store up customer understanding in the sales and marketing groups and then expect other departments to focus solely on their functions.
The company created a new department, a combined customer and employee experience team, to facilitate customer understanding. It set up listening stations where employees can go, either online or in an Adobe office, to listen to customer calls. And at every all-hands meeting, leaders give an update on the company’s customer experience delivery.
Facilitate direct interaction with customers. Companies need to develop ways for employees to interact with customers directly, even in “back office” functions. After all, every employee impacts the customer experience in some way, even if indirectly, so every employee can benefit from interacting with customers to better understand them and learn about their successes and challenges.
Airbnb considers hosts, the people who rent out their homes, to be customers, so it facilitates employee-host interactions by requiring employees to stay in Airbnb rentals whenever they travel for business. The company also asks employees to let hosts stay with them when they attend meetings at the Airbnb offices. What’s more, employees participate in an annual event alongside hosts so that together they discuss learnings from the past year and plans for the next.
Most organizations’ business models probably don’t allow for direct employee-customer contact as organically as Airbnb’s does, but leaders can still facilitate interactions by letting employees observe focus group, sales and support calls, customer visits and ride-alongs, and co-creation labs, and participate in customer events like advisory board meetings and industry conferences.
Link employee culture to customer outcomes. The adage “You can’t manage what you don’t measure” applies to customer centricity, too. Managers will be motivated and equipped to cultivate a customer-centric culture if they know if and how it impacts results, so organizations should ensure that they establish and track the link between culture and customer impact. According to Diane Gherson, head of HR at IBM, employee engagement drives two-thirds of her company’s client experience scores. That proves what Gherson and her team knew intuitively: If employees feel good about IBM, clients do, too.
Temkin Group, a customer experience consulting firm, has developed a model that estimates the impact of customer experience improvements on revenue in different industries. On average, Temkin calculates, a typical $1 billion company can gain $775 million over three years through modest improvements such as reducing customer wait times or making a transaction easier for the customer.
Tie compensation to the customer. Organizations should reinforce a customer-centric culture through their compensation program. Donna Morris at Adobe calls this “giving every employee skin in the game.” She says that for employees to know that customer-oriented attitudes and behaviors are expected from them, there has to be “an element of risk” to it.
So Adobe implemented a compensation program tying every employee to the customer. The short-term cash incentive plan reflects the company’s revenue performance as well as customer success measures such as retention. The program not only makes tangible the contributions to the customer that every employee makes but also produces organization-wide alignment because everyone is working toward the same goals.
Company leaders are starting to recognize that culture and strategy go hand in hand. Only when customer-centric strategies are supported and advanced by culture, a company can realize its customer-centric vision.
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If you want to learn more about cases where Alterna CX Voice of Customer solution was used for building customer centric culture, contact us at firstname.lastname@example.org