|According to Gartner, 80% of your company’s future revenue will come from just 20% of your existing customers. This means that delighting the customer at every turn needs to become a business imperative. Shifting to a culture of customer-centricity is not without its challenges, but, in an age where the consumer wields greater power than ever before, it’s the only avenue to increased profitability and better performance.|
What is it that distinguishes leading customer-centric companies from the rest? More often than not, it’s a universal focus on what the customer wants, and an intrinsic understanding of the customer experience that’s embedded in the very heart of the business. In a customer-centric organization, each individual is dedicated to delivering a seamless customer experience at every touchpoint throughout the customer’s lifecycle.
Customer-centric organizations understand that traditional business-driven strategies must give way to a customer-driven strategy. The focus is on finding out what customers need and want, and then structuring products and services to meet those needs. Customer-centric means looking at the organization from the outside in rather than inside out. It is about understanding what problems and issues customers face and then developing and implementing mutually advantageous solutions.
Nowadays, consumers put greater stock in social media feedback, which means that your brand’s reputation lies squarely in the hands of your customers, and by extension, their audiences.
In his article, What Customer-Centric Really Means: Seven Key Insights, (Harvard Business Review), David Stauffer defines being customer-centric as follows:
- It goes beyond handling customer calls efficiently — being customer-centric means addressing all customer issues fully and resolving them completely
- It is not merely about ensuring that support functions regard frontline workers as their internal customers — it is about ensuring that every employee adopts an external customer focus
- It involves more than telling employees how to treat customers appropriately — being customer-centric involves giving employees the authority and tools to decide on the right way to manage customers
- Being customer-centric is not only a matter of guiding customers through processes the way that the organization envisioned — it means letting customers interact with them as they require or wish
- It means striving to meet the customers’ future needs and is not limited to giving customers what they want in the here and now
- Being customer-centric is not about creating an organization that serves customers — it is about allowing customers to drive the organization
- It is not only about winning new customers through recommendations by current customers — it means having customers that say that prices should be raised
The rise of the consumer-led economy
Rapid technological advancements have given rise to a generation of highly discerning consumers that have a sea of information at their fingertips. In this consumer-led economy, customers can use their smartphones and other devices to compare products and service providers and, more importantly, to look up peer reviews on social media platforms.
This is a vastly different picture from 10 years ago, when consumers would make purchasing decisions based primarily on product features. Nowadays, consumers put greater stock in social media feedback, which means that your brand’s reputation lies squarely in the hands of your customers, and by extension, their audiences.
Consumers have become increasingly fickle and won’t hesitate to end a relationship with a company that fails to meet their needs. These empowered customers expect flexibility, agility, convenience and personalization, and when they don’t get it, they simply go elsewhere. This inversion of the relationship between customers and businesses means that consumers have more power than ever before to dictate an organization’s future.
Designing a culture that enhances the customer experience
Customer-centricity is not a once-off initiative; rather it is an organization-wide culture shift that places the customer at the forefront of all decisions across all departments and functions. Ultimately, customer satisfaction is every person’s responsibility, not just the job of those in customer-facing roles. It requires significant cross-functional collaboration, as well as a deep understanding of how each employee’s role impacts the customer experience, be it directly or indirectly.
Eight ways to kick-start your journey to customer-centricity
Becoming customer-centric is no longer optional, it’s a core business requirement which will improve efficiency and profitability, and secure return business. It requires a sea change in company culture, and should be viewed more as an evolution than a revolution. Following are eight steps you can take to kick-start your journey to customer-centricity.
The first step toward becoming a customer-centric organization is ensuring buy-in. Customer-centricity must be an executive priority — ultimately, it is the senior executives who will initiate the process of breaking down organizational silos and securing the cross-functional collaboration that is required to become truly customer-centric.
Organizational culture is made up of the collective beliefs, attitudes and behaviors of your people. To catalyze the mindset shift required for the move toward customer-centricity, management tiers need to engage with employees by asking the following questions:
- Which parts of your job directly affect the customer experience?
- Which parts of your job indirectly affect the customer experience?
- How can we improve on these aspects of your job to ensure our customers have a seamless experience?
Creating an awareness of how each person’s role impacts the customer experience, and stipulating how customers should be treated will go a long way toward creating a customer-centric ethos.
Every activity and process should be performed with the customer experience in mind. This is only possible when every employee in the company subscribes to the concept of customer-centricity. This will manifest differently in the various functions, for example:
Finance: “Are our invoices easy to understand?”
Legal: “Are our terms and conditions jargon-free?”
Procurement: “Is this supplier reliable enough to ensure we can keep our delivery promises?”
Marketing: “Is our website engaging and easy to navigate?
Ultimately, it is the senior executives who will initiate the process of breaking down organizational silos and securing the cross-functional collaboration that is required to become truly customer-centric.
To effect lasting change, you need to provide practical guidance to your teams and model the behaviors that your people need to adopt. This means actively coaching, guiding and mentoring your people to behave in a manner that is entirely customer-focused. It also means providing your people with the right tools and information to execute their duties effectively. You could consider instituting reward and recognition frameworks to cement the new behaviors.
It’s important to clarify the differences between a customer-centric approach and a customer service approach. Download the infographic: Why customer service isn’t customer-centricity for a deeper understanding of how the two philosophies impact strategy, customer retention and profitability in the long run.
Ensuring that real-time customer feedback is highly visible across the entire business is sure to keep the customer-centricity philosophy top of mind. All departments should have access to customer feedback, and a dedicated team must be appointed to respond to customer comments, reviews and complaints timeously. By making customer feedback visible to all, you’ll be encouraging every employee to ask: “What could I do differently to avoid this type of complaint? How can we do better?”.
The move toward a customer-centric culture is a journey, not a destination. With customer needs constantly changing, and competitor products always improving, the companies that will win are those that foster an attitude of continuously wanting to improve. So even when your customers are satisfied and repeat business is on the rise, it’s important to keep innovating and making changes to continually enhance the customer experience.
For an organization to become truly customer-centric, organizational silos must be broken down and cross-functional collaboration must be fully embraced. All employees need to understand that they are a link in a chain, and that changes within their function will impact other functions as well. To deliver a seamless customer experience, you need to ensure that all your people fully understand the customer journey and how each function contributes to driving value for customers.
It’s important to keep innovating and making changes to continually enhance the customer experience.
Customer-centric organizations strive to develop meaningful relationships with their customers. This enables them to better understand their customers’ wants, needs, motivations and buying behaviors. By understanding their customers more deeply, these organizations are better positioned to deliver seamless customer experiences. It’s vital that you develop authentic relationships with your customers — if you engage regularly with them, they are more likely to remain loyal.
For organizations to survive and thrive, they must delight customers at every turn.
Advances in digital technology are putting consumers firmly in the driver’s seat — for organizations to survive and thrive, they must delight customers at every turn. The key to providing an exceptional customer experience is an organizational culture shift — though it may be challenging at first, adopting a customer-centric approach will maximize value and drive superior performance over the long term. It’s this enduring commitment to understanding your customers’ wants and needs that will give you the edge over your competitors, and deliver optimal business outcomes.
This resource has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained herein without obtaining specific professional advice. Competitive Capabilities International (CCi) does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this resource or for any decision based on it.