Author Archives: Dr Linden Brown

Customer Obsession: Its a Mindset! Here’s one senior leader’s take on it.

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I have known and worked with John Stanhope over many years. John had a long career with Telstra culminating as CFO. He is now Chairman of Australia Post. Ever since I have known him he has had a customer mindset. Almost an obsession!

When I spoke to him about the mindset challenges in today’s business he said: “Today the focus must be on ‘customer innovation’. Many companies focus on innovation, but it is customer innovation that counts. At Australia Post our customers want their parcels anywhere, anytime, so we ask: How can we provide a great delivery process that gets better and better over time and do it profitably? Innovation must occur to meet our customer’s need and expectation of ‘anywhere, anytime’.”

He says all leaders must have a mindset that is externally and future-focused. This includes foresight and peripheral vision with future customer needs and changes in customer behaviour as central. This is what drives customer innovation.

To develop this mindset leaders must have a relentless pursuit that everything is about the customer. John says: “There are little signs that tell you. At the start of a meeting ask – Is this about our customers? If not, don’t have the meeting. Another key sign is ‘language’.  How do you frame a problem or an issue? Is it framed in terms of the customer or not?”

I asked John how you get this mindset. He says: “ There are many factors, but I think a key one is that you must immerse yourself with customers. Ask them questions, listen to what they say, observe their behavior and then put yourself in the customer’s position. If I were the customer, what would I want to solve this problem? How would I like to be treated? That applies to anyone in a business no matter what level and what function.”

In every company that is continually successful at innovation, there are leaders and employees that have a customer obsession mindset. Like Amazon, that has developed a customer-obsessed mindset and a customer culture to match, this is required for sustainable success.

The only way to future-proof your business, your leadership or your team is with a strong adaptable, innovative customer culture.

Learn more here

The reason why all the best leaders are M.A.D. Are you one of them?

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Last year I met with the CEO of the BPAY Group, John Banfield. BPAY is a leading payment systems service provider with Australian banks and financial companies. John told me that from an early age he always wanted to ‘Make A Difference’ (MAD). He said his two boys play rugby at school against a number of much larger, intimidating players, some are almost twice their size. He urged them to think MAD — that is, “Make A Difference” with a tackle or a pass. To keep their focus he would write MAD on their hands to remind them particularly when the going got tough.

John says that he expects that of himself and others in his business. In particular to think MAD with a purpose. John has been transforming BPAY over the last 3 years leading all employees to “think customer”, which is a central corporate value, and make a difference through customer-inspired innovation throughout all parts of the business.

This includes the shared services functions such as IT and Finance where it is not always easy to create tangibility for a customer mindset. John said: “In these cases customers are employees for these functions. It is here that the values of “better together” and “think customer” connect. So shared services resonate by putting collaboration and customer together with internal customers. If they need to collaborate with three or four departments on a particular day, they sit together. This is particularly important because we are working to develop innovative new products with entrepreneurs and customers and keeping our eye on customer and culture is critical.”

Like all customer-centric leaders I know, John believes that the financial results are a consequence of what comes out of the customer experience and what is delivered that is valuable to customers. He says: “The numbers will come and our shareholders will be happy when our customers embrace the services we provide”.

This is the centerpiece of an innovative customer mindset and you have to want to ‘make a difference’ to implement it. To prove the point John and his team at BPAY have just introduced a new person-to-person payment product Osko by BPAY™.

More than 50 Financial Institutions are beginning to gradually roll out a whole new way to pay and get paid into their online and mobile banking. Osko will make payments faster, easier, and more convenient for consumers and business than ever before via any participating bank.

With customer-led innovation like this you end up with inspired employees, delighted and loyal customers and satisfied shareholders — the strong fundamentals of a sustainable business.

Want to learn how to build a customer-obsessed company?

Learn about where to start here.

The reason what they teach in business school is wrong and why a customer-obsessed culture is the only answer

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Many of today’s senior leaders were educated in an era where business school professors told them the sole purpose of a business was to create value for shareholders. This, at a time when only a few voices professed what revered thinker and writer, Peter Drucker, proposed that the purpose of a business is to create customers profitably. The two mindsets are complete opposites.

I recently watched the Netflix series: Dirty Money. It investigates three cases of big corporations where the only consideration by their senior leaders was the creation of shareholder value and their own bonuses at any cost.

Volkswagon was proven to have initiated and perpetuated (by senior leaders) built-in software to falsify carbon emissions in order to make claims about their cars to enable them to grow their business in the US with diesel-fuelled vehicles. Even when proven, senior leaders were in denial until indicted by the US government.

HSBC turned a blind eye to money laundering by the Mexican drug cartels through their banking network. Despite being castigated in US Senate investigations and regulators over a decade, there was no effective action taken and finally, the company was fined almost US $2billion with an admission to serious charges. This was a willful disregard of the consequences of their actions (or non-action) to achieve their profit goals at all costs.

Valiant Pharmaceuticals embarked on a merger and acquisition strategy to buy drug companies with unique monopoly brands as a basis for growth. Once acquired the prices of these life-saving products were hiked to levels where consumers could not pay for them – with life-threatening consequences. The CEO’s one stated aim was to create value for shareholders.

The senior leaders of all three companies gave no thought to the consequences for their customers and the community. In fact, they saw them as irrelevant. Excessive pollution from cars is a prime cause of the premature death of many consumers. Enabling money laundering financed drug lords and the associated violent deaths of innocents in Mexico and the drug habit in the US. Hiking pharmaceutical drug prices 10 or 20 fold over a short period created havoc and misery for many consumers with life-threatening illnesses. All of this because the senior leadership mindset and corporate culture were focused only on profit and their own bonuses.

I have heard this in many large businesses where people down the line tell me that the only concern of leadership is to meet profit goals at any cost. That cost is often lost jobs, unhappy and disengaged employees and frustration and disgust of customers.

Yet we know that the leaders of today’s most successful, modern large businesses have a totally different mindset. It is best illustrated by Jeff Bezos, who from day 1 at Amazon has built a culture around customer obsession and a focus on continually improving the value and experience delivered to its customers. He has never wavered from this mindset despite criticism at different times. What is the result? It is the most valuable and sustainable business on the planet – with a history of little more than 20 years.

We are starting to see this mindset in other leaders of long-established businesses. Richard Branson at Virgin is one. Paul Polman at Unilever is another. These leaders take the view that “what’s best for the customer is best for the business”. They truly believe that by creating a customer-obsessed culture in their leadership and employees they will deliver superior value to their customers and for their communities. And by so doing they will achieve long-term profitability and sustainability in their businesses as well as personal rewards and happy employees. They take a longer term and future-oriented view in their decision-making and their behavior.

This is foreign to many senior leaders and there is a lack of experience as to how to do it. In our research of more than 50 customer “obsessed” CEOs around the world and more than 300 businesses we now have a measurement tool that can create this mindset, benchmark your business against the best in the world and set out best practice steps to move you to the next level – a level that will be required for survival and success.

This is why every business should have a “Minister for Foreign Affairs”

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Recently I interviewed Annalisa Gigante, a Board member of ZIS (Zurich International School) and former Head of Innovation at LafargeHolcim. We were talking about customer-centric leadership and Annalisa suggested that companies could really benefit from a “Minister for Foreign Affairs”. She said today “we need to know what’s going on with the rest of the world.”

I thought about this and realized that the amount of disruption we are facing in our businesses and work lives suggests that we can gain better context on what’s happening, make better decisions, and have a better chance of benefitting from it if we do what she suggests.

In our research and work with companies wanting to become more customer-centric, we have called this factor: Peripheral Vision. That is, the externally focused “wide vision” activities carried out to understand the likely impact on the future business from changes in technology, society, economy, political and legal, and the natural environment.

Many companies seem to have a “Minister for Foreign Affairs”, but like we see in politics, often the learnings and potential impacts of these insights are not widely shared – and consequently not acted upon. In practice, peripheral vision should be built into future business strategies. But in our experience, it is frequently missing.

If you want to know how you can identify if your “Ministry of Foreign Affairs” is effective, find out about how our MRI (Market Responsiveness Index) can help you.

You can’t fake customer-centric culture

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We hear a lot about fake news these days – what’s real and what’s fake is sometimes hard to know. That’s not the case when it comes to customers “reading” your culture.

Let me recount my experience with 3 upmarket restaurants in Sydney, Australia.

Sydney has many fine restaurants. I will compare my experience at two of these – Aria is at Circular Quay looking at the opera house and the Sydney Harbor Bridge and Jonah’s is on a cliffside on Sydney’s northern beaches overlooking Whale Beach and the Pacific Ocean. Both serve fine dining at expensive prices with excellent food.

I decided to book Jonah’s for my wife’s birthday and asked for a table next to the window overlooking the ocean. I was told this was not possible and when I asked why, I was told by the manager that there are many factors that they use to decide who have the window tables – when the booking was made, how many people are in the party, what the booking levels are for that particular day. I was making the booking more than a week in advance and on a weekday at the earliest lunchtime sitting, but still could not be told whether I would get a window table. Choices were 12 noon or 1.30pm. He said, “ we are very busy, we get tours and we decide on the day where people sit.” There was an arrogant tone in his voice so I decided to try Aria.

The call to Aria was a totally different experience. “Yes, we can give you a window table, would you like a surprise cake for your wife’s birthday?” You can choose your time of arrival – “12.30pm is fine and you can stay the whole afternoon.” Aria is just as busy as Jonah’s but you have a completely different mindset. At Jonah’s it is all about their convenience, their operational procedures, their rules for organizing tables. At Aria, it is about what the customer wants and how can they be satisfied. You cannot fake it. The customer mindset exists or it doesn’t. The customer knows this with a simple phone call.

Then there is the dining experience. My wife and I went to Pilu, a Sardinian specialty restaurant at Freshwater beach on Sydney’s northern beaches. This too is an upmarket restaurant. What impressed us about this restaurant was the staff. The sommelier knew every detail possible about the wines, the server knew exactly what was in each dish and could explain it. Both established a relationship with us by telling us about their hometown in Italy. They were not rushed, were patient with our questions, answered them fully and made suggestions. At the time of payment, the manager told us how much of a team effort was involved and how his team worked together to make a memorable experience for their guests. At the end of the evening, they asked if we would like to give them information on our birthdays and we would be offered a 5-course degustation meal free at that time. We happily signed up and provided the information they wanted.

A customer culture only exists when it is authentic and all employees are part of a happy, collaborative team, knowing that it is the customer that is the center of their world. It can’t be faked. It’s the difference between getting the business and creating advocates and not getting the business and getting bad reviews.

How do you get it? You will find many of the answers in our book: The Customer Culture Imperative.

Is there a customer-centric gene?

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Recently I was talking with Dmitry Pukhov, co-founder and owner of a very successful event catering company in Moscow. When I asked him about customer-centric leadership he said the core characteristic is a desire to help people that comes from the heart. He said he believes that we all have a gene that can create a drive to provide service to others. But only some people have developed this gene – through their upbringing, experience, interaction with others who use it and mentoring from customer-centric role models.

There is some scientific evidence to support this. Research shows that people who are more caring and compassionate towards others share a common gene variation linked to the receptor for oxytocin (sometimes referred to as the “love” hormone) that plays a key role in the formation of social relationships and impacts our capacity for empathy. The science suggests that those with the “GG” variant of this gene are better with people and generally more caring.

But all is not lost for those of us that don’t have the “GG” genotype. There is also evidence to suggest that compassion and empathy can be developed through socialization with people that role model it and experiences that elevate it.

I asked Dmitry why his business is so successful – it has grown rapidly over the 12 years since he founded it – and he told me it is because being customer-centric and service focused has always been the driver in his business. He recruits people that exhibit the customer-centric gene and invests in the ongoing development of the gene in all his staff.

Are you using your customer-centric gene or is it dormant? If you want to know what to do to develop it, refer to our book: The Customer Culture Imperative.

This is why superb customer experience is not consistent or sustained by most businesses.

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Don Peppers wrote a profound article recently pointing out that most companies are not acting on building superior customer experience over the medium and longer term. He tells us that most of what is being done delivers minor efficiencies and is short-term in impact – NPS measurement that addresses the symptoms and not the cure, customer journey mapping that is not really acted on, and creation of a customer experience role or function that has no authority and limited influence across the organization. Over time this impetus dilutes and dies as senior sponsors move focus on to other initiatives. He provides some good advice on how to overcome some of these weaknesses.

In our experience, most companies, claiming to be customer focused or embarking on the activities noted above, are missing the key foundation required for sustained customer experience success – a strong customer-centric culture. The diagram below illustrates how a customer engagement culture encompassing all leadership and employees drives customer experience, which in turn creates loyalty, advocacy, and better business performance.

Customer Culture Pyramid 2017

Peppers notes, and we agree, that customer experience is a journey. It requires the capabilities that a strong customer culture delivers and needs a focused plan and commitment by senior leadership to carry it through to the medium and longer term. It requires a “customer” mindset in all parts of the organization and a deliberate commitment to embedding this at all levels and all functions as “the way to do business”.

It should begin with measurement and benchmarking of the level of customer-centric culture in all parts of the business. This highlights strengths, weaknesses, levels of employee engagement with customers, and priorities for capability building. This forms the foundation for an ongoing customer experience improvement strategy that all employees in the business can buy into and can contribute towards its implementation.

At MarketCulture we have a proven roadmap that successful companies use to build an ongoing customer experience capability that delivers consistency and sustainability – and results in sustained growth and industry-leading profitability.