Tag Archives: Customer Experience

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

dirty-money

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 the secret to delivering powerful Customer Experiences that only a handful of CEO’s know about!

Richard_Branson_Customer_Centricity

Why engaged customer-focused employees are vital to business success!

In today’s market, the majority of companies have very little to differentiate themselves from their competition. Their product and services are very similar if not identical. It is so easy to change to another company that it can be done in minutes or even seconds on the web. Social media can instantly let millions of people know what just took place. Customer expectations have changed and their demands are greater than ever.

Future business performance and sustainability will come down to whether or not customers continue to use your products and services or leave for an alternative supplier. It costs 7.5 times as much to gain a new customer yet the majority of companies spend their budgets on attracting new customers. What are you doing to retain your current customers?

MarketCulture’s purpose is to help companies recognize the importance of building stronger customer experiences that retain customers. We believe that inspired, engaged and empowered employees focused on customers are vital to success. It comes down to how the company delivers on its promise and ultimately it is all employees that make this happen. It takes one bad experience and you have lost a customer.

As leaders do you truly understand what your employees need in order to deliver a great customer experience? Are we telling them what to do or are we engaging them in what they believe is important? Richard Branson says that engaged and happy employees deliver superior customer experiences. Virgin enters markets where customers are dissatisfied. They quickly win a strong market share by providing great service with a touch of magic. Employees want to be part of the solution and feel that they belong. They want to be listened to and feel that their feedback contributes to the success of the business. Your employees are the ones that retain or lose your customers.

Companies today implement many tools that measure either employee engagement or customer satisfaction. They allow leaders to know whether or not they have happy/unhappy employees or satisfied/dissatisfied customers yet they rarely provide insight into how they can improve. Leaders need to understand what employees need to deliver the company’s promise and customer satisfaction.

“There are many ways to center a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But in my view, obsessive customer focus is by far the most protective of Day 1 vitality.” Jeff Bezos – Amazon Founder and CEO

How do we engage employees to build stronger customer experiences?

Customer experience comes down to the way your company and employees behave – whether you deliver or not on your promise. It can be as simple as responding to a customer in a timely fashion or just the tone of your voice. Amazon is now one of the biggest companies, yet they have retained a strong focus on their customer experiences even as they have grown to employ more than 300,000 people. The test of a company is not when things go well but when they don’t. Customers are looking to receive the value they paid for or they will simply try an alternative supplier. Where do you start building a stronger customer experience? You can start with the customer and find out whether or not they are satisfied but that is after the event has occurred and maybe too late. Alternatively, you can start with those that create the experience – “the employee” – and find out what they need in order to be able to deliver a great customer experience.

Steve Job’s recognized this towards the end of his time as CEO of Apple when he said:

“It’s not about me, it’s about the company and it’s about the cause. It’s not about everything being dependent on me. I have to build a culture, I have to think about a successor, I have to think about setting this thing up to do well over time. And in the end, what matters is, I want Apple to be an enduring great company and prove it didn’t need me.”

How do we do it? – It is simple. Listen to your employees, find out what is important to them, engage them, act on their feedback, empower them to solve customer problems and they will deliver better customer experiences.

MarketCulture researched 100’s of companies across the globe that exhibited both customer-centric decision-making with employees empowered to deliver great customer experiences. Some of these companies included Amazon, Google, Virgin, Apple, and Ikea.

The research revealed 8 disciplines that employees act on to deliver great customer experiences. We found these disciplines used across the entire organization including all support functions. This was not evident in companies that deliver inconsistent customer experiences.

Through both quantitative and qualitative employee feedback companies are able to act on strengths and weaknesses in order to support employees in delivering superior customer experiences.

What – A unique employee assessed customer engagement measurement tool.

Where do we start? The first step is to discover what is important to the employees in order to provide a better experience for customers. To do this we need to engage the employees and gain their feedback. The Market Responsiveness Index (MRI) is a unique assessment tool that all employees, including leaders, complete. The MRI has quantitative (scaled questions/benchmarked) as well as qualitative feedback (verbatim comments). This will identify the strengths and weaknesses of your company against companies that use best customer-centric practices. This will create change and build future business performance through the retention and growth of customers. Studies have shown that companies with Customer Centric practices outperform the others.

What is the Market Responsiveness Index (MRI)?

The MRI is a web-based employee assessment, requiring 15-20 minutes to complete, that benchmarks employee behaviors within your business against the most customer-centric companies in the world. This translates into 8 key disciplines all with a strong focus on the customer. These are Customer Insight, Customer Foresight, Competitive Insight, Competitor Foresight, Peripheral Vision, Cross Functional Collaboration, Empowerment and Strategic Alignment. Your company’s performance in these disciplines has been shown to drive future customer satisfaction, revenue growth, and profitability.

The MRI will provide key benefits to your company.

1. Momentum, Engagement and a New Mindset: It will create focus and momentum for a Customer Centricity initiative across the business and can be used to drive the embedding process.

2. Measurement: It is designed to provide the basis for benchmarking and measuring progress on those customer-focused behaviors that drive customer satisfaction, advocacy, revenue growth, profit and plans for individual managers to drive improvements.

3. Gain Insights: Hear directly from employees on the key issues holding the organization back from being more customer-centric in specific areas and across the entire business.

4. Tangibility and Communication: It makes customer culture tangible for all staff by identifying relevant activities that support business strategies. Through its methodology and measurement process, it facilitates communication of clear priorities.

5. Gain broad employee involvement: It provides staff with an opportunity for input and direct engagement in Customer Culture initiatives and a forum for agreeing with actions to be taken and a feeling that they are a key part of the journey and contributing to its success.

6. Build a common language across the Business: It also acts as a tool for ensuring staff within the business “get it” and develops a common language and behaviors from Customer Culture initiatives. It forms the basis for ongoing discussions and actions deep within each functional group which is where the ultimate success in embedding customer culture will be determined through collaboration.

7. Accountability: It provides customer-centric behaviors that can be included in the Key Performance Indicators of managers and their teams.

8. Benchmark: It provides the business with a benchmark against some of the world’s most customer-centric organizations. How do you compare with companies like Amazon, Apple, 3M, Virgin and others included in the database? The current database includes more than 300 corporations globally across B2B and B2C and several hundred business functions and units.

Interesting in starting your journey to a customer culture? Learn more here.

You can’t fake customer-centric culture

Woman holding mask of her happy face

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.

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.

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

 

How one person can make a difference role modeling customer centricity

tarpys

Tarpy’s Roadhouse just outside of Monterey, California is renowned for its good food, friendly hospitality and fast service. One person, Niranjan (“Nick”) Subedi, a native of Nepal, shines out as a role model in serving guests at the restaurant since 2000. A phrase known to every Nepali translates to “guests equal god” and offering all you have to a guest is considered a moral duty. Nick remembers every guest and their preferences even when they have not been back to Tarpy’s in a long time. Clint Eastwood, who lives in the area, is a big fan and he like many guests requests to be seated in the area where “Nick” is serving. Nick’s belief is that service is a duty and a pleasure and he shows this in his wide grin and attention to customers’ needs. But more than that he says: “I try to bring the human element to dining, to show that I love the guests”. He lives nearby with his wife in a house he owns “ because of my customers. I owe everything to them,” he said.

“Guests equal god”

It only takes one person like “Nick” Subedi to act as a powerful role model in a business reflecting strong customer-centric behaviors to lead others to do the same. If enough people in your organization follow this example you will have a strong customer culture – and a sustainable thriving business.

Lessons from REI: Aligning your People

We have just completed one of the busiest weeks in retail in the United States, with Black Friday for the physical stores and Cyber Monday for the online retailers. This week now blends together with doorbuster deals bombarding us constantly online and instore in the week leading up to Thanksgiving as well as weekend afterwards.

What is different this year is that some major stores have decided to stay closed during this period. In the land of the consumer this a really big deal!

One chain in particular stands out, REI, the outdoor recreation retailer with more than 12,000 employees and 140 stores around the US decided to close this past Black Friday. See below, their CEO, Jerry Stritzke’s 30 second announcement:

 

“We believe that being outside makes our lives better. And Black Friday is the perfect time to remind ourselves of this essential truth.” – REI CEO, Jerry Stritzke

So what is behind this decision? I believe it is to better align REI’s core values with its actions in the market. REI’s core mission is “to inspire, educate and outfit for a lifetime of outdoor adventure and stewardship.”

What better way to live that mission and align all of their people around it than closing on a day that allows their own people get outside and live the company’s mission.

Now that all sounds great but how does that help their customers? No doubt some customers may be inconvenienced by their physical stores being closed. However they will still have a small number of staff manning their website so they are not completely close for business.

REI are reacting to growing concerns by their customers and others that retail in general is overshadowing the core purpose of thanksgiving which is to celebrate with family and friends. They are betting that this decision will pay off over the longer term by aligning their people with their mission while also meeting the changing expectations of their customers.

Ultimately if you want your people and customers to really buy-in to what your company is about you must walk the talk, for me this is strategic alignment in action!

Interested in what it takes to be truly customer centric? Learn more here