Author Archives: Christopher Brown

How a customer culture makes or breaks new product success: A lesson from Comcast

For those of you familiar with our work you will know that we successfully validated the link between a customer centric culture and new product success. Our chart below shows the links between our 8 dimensions of a customer centric culture and the key business performance outcomes.

8 Dimension Performance Links

Essentially organizations that develop a cultural focus that is obsessed with customers, outperform everyone else in the markets in which they play.

I just came across a great example of how this can work in reverse for a company that has not developed a customer culture – Comcast Cable.

Comcast recently announced a major new product – they are now a cell phone provider in the US market:

Comcast New Product Intro

Here is the reaction I found in some comments people who saw this announcement on LinkedIn (the majority of the comments were along the same line….):

Comcast New Product Intro Reaction

This is of course only anecdotal evidence, however, it is going to make it tough to make this product launch a success with an undercurrent of negative feelings towards the experiences many customers have had with the brand in the past….

How you treat your current customers today will have a massive impact on how they will respond to new product introductions in the future. 

Build your company’s customer culture today to ensure you continue to be successful in the future. Learn more in the Customer Culture Imperative, our award winning book.

Adapting to change by putting Customers at the center of everything: Lessons from Macquarie Telecom

Transforming Unhappy Customers into Happy Customers

“The Only Thing That Is Constant Is Change” – Heraclitus 500BC

It’s hard to believe this quote is from more than 2000 years ago… I can’t think of a more relevant quote to describe the times we are living in right now!

From a business context the change we are experiencing is the rapid shifts occurring in customer expectations and behavior. The companies that are embracing this are the ones that are winning and will continue to win in the future.

The question is how do we adapt to this changing customer environment, stay ahead and stay relevant?

Many forward thinking organizations are using increasingly sophisticated customer experience metrics to stay in touch with what their existing customers are experiencing. Specifically they have embedded these processes in a manner that makes it part of their organizational culture – we call this a “Customer Culture”. A great example comes from the work being done at Macquarie Telecom, a leading Telecommunications firm in Australia.

Macquarie’s CEO, David Tudehope, has taken a personal interest in leveraging the Net Promoter Score (NPS) methodology to help drive a customer centric culture. NPS is essentially a simple way to measure customer advocacy. It is based on answering the question – “How likely are you to recommend us?” on a 0-10 point scale. While a great methodology, it is not the right one for every business. What’s more important than the metric is the fact there is a focal point at which all employees can focus on and work together to improve.

For Macquarie, leveraging this methodology has been transformational. It has raised the visibility of the importance of customer experience on customer retention and ultimately business performance. It has also served as a goal that aligns everyone and drives collaboration across the firm.

What have Macquarie learned from their transformational journey that you can apply in your organization?

  1. Engage everyone in the journey – measure every significant touch-point as everyone has an impact on how customer’s experience the company
  2. Be Transparent – display results for everyone to see so teams can see how others are performing and compare results
  3. Celebrate individuals and teams – share great customer stories and celebrate teams with high NPS scores
  4. Integrate into hiring processes – hire people with a desire to create great experiences for others
  5. Customer Success gives employees meaning and purpose – connecting people’s roles with the impact they have on customers provides meaning, inspiration and purpose and will derive up engagement levels and ultimately people’s performance

What are the results?

Macquarie’s NPS is 60+ which means they have many more promoters than detractors (see this post to compare Macquarie’s NPS with the most customer centric companies in the world). While they are not the best in the world (they can still improve), they significantly outperform their competitors in the space they play in.

To read more about how to begin the journey to a customer centric culture, get a copy of our book, the Customer Culture Imperative or learn about the Market Responsiveness Index.

What happens when you don’t have a corporate culture obsessed with customers – Lessons from United

united_man_removed

A man is forcibly removed after not giving up is pre-paid seat on a United Flight

We witnessed one of the most extreme examples of what can go wrong in a business that has truly lost sight of its purpose.

As a former United Global Services member (United’s top tier for frequent fliers) I was appalled at how badly United handled a relative routine situation that probably happens multiple times a day in various cities across the US. What on first pass looked like the removal of a potential terrorist happened to be a paying passenger who was also practicing physician.

United sometimes over sells airline tickets in order to make sure they fill their flights and remain profitable. I am not against this practice, it makes business sense. However when this impacts customers, (and it inevitably will) this becomes a true test of an organization’s customer centric culture. Will it do what’s best for the customer? (A customer centric view) or will it protect a short term myopic view of its profits for that particular flight (a transactional view).

In this case United choose its policy and procedures over doing the right thing for its customers. Clearly there was an upper limit on what was available to be offered to make this situation right for their customers. United claims they offered $1000 to passengers to take another flight so that crew members for another flight could board to go to another plane – there were no takers. Instead of upping the compensation to a point that passengers felt like it was a fair deal, they decided to pick passengers based on their frequent flier status and other connecting flights. Three left peacefully although clearly unhappy and one refused resulting in the social media and traditional media storm that came after a video showed the passenger being forcefully removed.

Company Centric CEO Reaction – Oscar Munoz

Those of us that work in the culture space know that the CEO and top team set the tone and shape organizational culture.

Oscar’s initial response was to apologize for having to “re-accommodate these customers”. While externally he made attempts to diffuse the anger at the situation internally he sent a memo to employees that defended the crew’s actions, calling the passenger ‘disruptive and belligerent’ and praising his staff for going ‘above and beyond‘.

united_comment_twitter

I understand he wants to stand behind his employees, support them and not throw them under the bus for this incident but really he was trying to “protect” the company and the United Brand. This message also reinforces poorly thought out policies that do not get to the heart of what great companies do – they have a culture that puts the customer first.

Finally, two days later Mr Munoz has accepted responsibility for the disgraceful incident:

“I continue to be disturbed by what happened on this flight, and I deeply apologize to the customer forcibly removed and to all the customers aboard………. “No one should ever be mistreated this way.”

A colleague of mine recently relaid an experience he had in a very similar situation on an Emirates flight. He said they just kept increasing the enticement to get of the plane. Eventually enough people took up the offer. They ended up giving away 2 business class return tickets from Australia to Dubai  as well as accommodation plus $US600.

This price was small compared to what United will now go through…..

United takes a $255 million dollar bath.

The value of United has fallen by $255 million as a result of this one incident and the bad press and social media storm surrounding it. How much were they offering passengers to deplane again?

Eric Schiffer, CEO of Reputation Management Consultants, termed United’s handling of the incident “brand suicide.”

“When you go onto a United flight, you shouldn’t have to be concerned there will be blood or you will get slammed in the face,” Schiffer said. “I think you will see an effect on sales from those who are disgusted by the gruesome action. And it’s catastrophic for a brand’s trust.”

No doubt United will lose customers and it deserves to, what comes next is a question of leadership and culture.

If all employees have a customer centric mindset and are empowered to do what is right by the customer this would not have happened.

That’s what we do at MarketCulture. We help companies understand the importance of putting the customer at the centre of the organization – a mindset that establishes the idea that “What’s best for the customer is best for the business”

Why it’s time for the banks to shift their corporate cultures

Wall_street_bull_CREDIThtmvalerio_Flickr

Image Source: htmvalerio

Big banks and investment houses around the world have been guilty of bad behavior stemming from unacceptable corporate cultures that have led to the disaster of the global financial crisis in 2007-2009. This was followed by the London foreign exchange scandal in May 2015 when six global players agreed to pay $US6.5 billion in fines for their misbehavior. On a smaller, but still significant scale, behavior of the big four Australian banks has come under scrutiny and evidence indicates that they have failed the culture test. A banking enquiry was instigated in Australia with several recommendations made, but not yet implemented.

A big part of the answer to poor corporate culture lies in the large banks developing a strong customer-centric culture. This is a culture where the well-being of their customers is a central philosophy and value that guides decision-making. It is a philosophy embodied in a bank’s vision and purpose that is well beyond making money. It is a mindset acted out at all levels that says “what’s best for the customer is best for the bank”. This doesn’t mean that the banks give their customers everything they want. It means that they understand the needs of their customers and deliver what they promise embodied in their strategy to deliver value and a good experience.

The leaders of big banks will tell you they are customer centric and do this. They point to improving customer satisfaction and net promoter scores. That may be evidence of improving customer centricity, but it does not give us the direct evidence of a strong customer culture. To show that evidence they have to measure it directly – not just some type of anecdotal absolute measure, but using a valid tool that compares their customer culture with the best in the world like Amazon, Virgin and Lego. These companies and others have a powerful purpose that aligns vision, values and strategy around serving their customers and communities that is embedded as a culture in everyone in the organization at all levels and all functions. It is led, role modeled and reinforced in their decision making by their senior leaders.

There is such a valid benchmarking tool available called the Market Responsiveness Index (MRI). This tool based on extensive research and validation testing now enables a bank to benchmark itself in a global database of more than 250 organizations on 8 decisive cultural capabilities. It points out cultural strengths and weaknesses and guidelines for fixing them. It provides credible evidence of a bank’s level of customer culture. This can provide the checks and balances that banking leaders need to be confident that their culture is as it should be – serving customers and the community (profitably).

The Customer Culture Imperative – an award winning book – provides the framework for measuring customer culture directly and the research that underpins the MRI benchmarking tool.

This can help bankers sleep at night as well as the rest of us in the community. And it can allay the fears held by regulators of potential ongoing problems that stem from poor cultures in large banks.

Why are so many customer-centric leaders on their own?

businessman thinking in office

Many customer centric leaders we have spoken with are facing challenges they did not expect. While they themselves understand the imperative for a customer culture that will drive future business performance and sustainability and act as role models in leading the business in this way, so often they feel alone and frustrated at the top. Despite their best efforts their leaders don’t see it in the same way.

Why? Because their direct reports are still operating with a functional mindset. Or they see proposed initiatives to strengthen the culture to improve customer experience as extra work they don’t have the time for. Or they don’t understand what it means to be a customer-centric leader and why it is critical in today’s disruptive business environment. And this is spiraled down to middle management and to the people who report to them.

This is perpetuated by managers’ KPIs that are primarily functionally focused. This creates silos, lack of collaboration and lack of effective support for organization-wide initiatives.

This is not solved by ad hoc efforts to get people on board.

It requires a commitment to an organization-wide initiative that measures and benchmarks the current level of customer-centricity and engages leaders at all levels for the their inputs. It requires the development of a customer-centric strategy designed to align people with purpose and job relevance that connects the value they deliver to the customer. It needs to create a focus on easy to understand, credible and robust organization-wide customer metrics that everyone can buy in to. This needs to be part of an implementation roadmap of digestible steps that inspire people to participate in and carry through.

Above all, this must be tangible, meaningful and actionable.

Often the hardest part for a senior leader feeling all alone and frustrated by his or her team members that don’t ‘get it’ is to make a start.

The best place to start is to get a tangible benchmark of where we stand today as a business against the most customer-centric organizations in the world. This assessment involves the participation of all leaders and places a mirror to our business. The Market Responsiveness IndexTM (MRI) is a powerful tool to help you get your team on board. It is an assessment tool that will show you that you are not alone – in fact there are many others in different parts of your business and at different levels that think just like you do.

And they, just like you, want to make a difference that counts.

Customer Centric Leadership in Action – A lesson from Elon Musk

tesla_charging_station

One of the central tenets of being a customer centric leader is listening to customer feedback and responding with action.

There is no better recent example than Elon Musk’s response to a customer complaining about the Tesla charging stations being used simply as car spaces.

The Tesla customer complaining happens to be Loic Le Meur, a fellow entrepreneur and major tech influencer, with 130k followers on twitter. You could argue that probably holds more weight than just your average customer but clearly the issue was one bubbling up and on Elon’s mind.

Here is the interchange from the two on twitter below:

elon_musk_twitter_response

Loic’s tweet was responded to within 20 minutes and within 7 days the press announced “Tesla to begin charging idle fees to those remaining on the charger beyond a full charge”

As the team at OfficeChai reported:

“Tesla was going to charge $0.40 for every minute a fully charged Tesla would stand at its parking stations after a five minute grace period. This simple change would ensure that people wouldn’t leave their cars at parking stations, preventing others from using them.

And what’s incredible is the pace at which the product change was implemented. Tesla might still call itself a startup, but it hardly is one – it has over 30,000 employees, and large engineering teams. To have a product feature conceptualized, implemented and shipped in a week is nothing short of miraculous.”

Now this might not be the perfect solution but Tesla will listen to customers and refine further as needed.

This is what customer centric leadership looks like in action, in this case led from the top. Elon’s expectation is that everyone in Tesla is listening to customers and responding to continually refine and improve the experience and value being offered.

Are you are customer centric leader? Find out more in our book, the Customer Culture Imperative

 

How a Customer Centric Culture can save lives

virgin-trains_driver

The team at MarketCulture recently ran a one day leadership workshop in Sydney, as is often the case we get to hear some incredible stories of the power of customer thinking.

One that really stood out was the story of a driver for Virgin Trains.

Virgin Trains is a great story of a business that is always trying to improve the customer experience, Richard Branson is well known for saying “there is always another way to delight a customer.”

Many people would think why would you include train drivers in a program designed to improve the customer experience? They just need to drive the train, they are hidden away at the front with little interaction with actual customers.

Virgin did not believe this, their philosophy was that everyone matters when it comes to delivering a great customer experience. As a result the train drivers were included in workshops designed to help each employee think about their role in delivering great experiences.

A week or two after one of the sessions, a veteran train driver was taking the normal route he had taken for many years and as he rounded the bend on a bridge he noticed a slight bump on the tracks. It was not particularly unusual, small bits of debris can often end up on the tracks. However this time, with the recent customer thinking training on his mind, it made him think more deeply about the bump. More specifically he thought about the passengers on the train and his responsibility for keeping them safe.

He wondered whether passengers had noticed the bump? At the next stop he decided to radio the maintenance crews and report it. In the past it was not something he would normally do as it would mean an investigation of something that was in his 30+ years experience probably nothing.

He continued to the end of his journey for the day. As he pulled up to his last stop his shift manager was there waiting.

“That bump you radioed through”… the train driver winced thinking he wasted a bunch of people’s time… the Shift manager continued “our engineers were just out on that part of the track, it seems a strut supporting the bridge has failed. If we kept running trains over that section we would have had a derailment and hundreds of people could have died. I am so glad you noticed it, you have helped us all avoid a catastrophe. Even if it was nothing, I am glad you reported it, customer safety really is our number 1 priority.” The train driver was relieved, not only had he averted disaster but he had been empowered to do the right thing for customers even if it had consequences for the train’s operations.

The driver was later awarded outstanding employee of the year and celebrated at the annual Virgin Conference in the UK.

This is a powerful story about how customer thinking can help people connect their work to the bigger picture and their responsibilities in creating a great customer experience.

For more stories on Virgin Trains and other great customer centric companies you can check out our book, The Customer Culture Imperative