Right customer orientation

Each of us is a customer, so “customer centricity” should be a very easy topic to understand. As a customer, what do you think it means to be customer-centric for those you shop with? For me it means that they “understand” me in that I can easily access and use their offer that helps me to do something in my life/business. Just stick with that statement and the gems are there:

  • “Simple” typically means without major costs such as burdens in terms of time, concern, effort and financial aspects
  • “Access and use” typically means both finding the solution that helps me get something done and using it to get something done (pre-purchase and post-purchase).
  • “Helps me get something done” usually means that whatever I buy is a means to an end. I’m just trying to live my life and run my business.

Note that as a customer, it’s all about me. Sure, I’m happy to provide feedback to my suppliers, but usually because I hope it will help me in the future – or at least help someone else avoid some of the pain I may have been experiencing. And that is the basic fallacy of most CRM/CEM/NPS/C-Sat/etc. Aspirations: Companies tend to ask questions from their perspective, map the customer journey from the company perspective, motivate employees from the company perspective, and so on — NOT from the “customer” perspective.

To be customer-centric, companies simply need to see things the way customers see them and align their day-to-day decision-making accordingly, with all other efforts being secondary to – or related to – seeing things the way customers see them.

Customer-centric ROI

Why should a company be customer-centric? Because customers activate the money machine. Shareholders leave when customers leave, not the other way around. If company relay a message with customers, they sacrifice non-value-added and wasteful efforts, policies, processes, behaviors, time and costs. And alignment helps customers feel the business is “getting them,” leading to organic customer evangelism: customer retention, share of wallet, positive word of mouth, business growth.

The book Firms of tenderness (of Sisodia, Sheth & Wolfe) explains how “lovable companies tend to be enduring companies”. To identify the companies of the Kosetung (FoE), the authors asked a broad sample of people which companies they love, then worked backwards to identify those companies’ collective, distinctive core values, policies, and operational attributes—and then their return on equity – astonishing insights emerged. The FoE list includes the usual suspects and then some: Amazon, BMW, Caterpillar, Google, Harley Davidson, IDEO, IKEA, JetBlue, Johnson & Johnson, LL Bean, REI, Trader Joe’s, UPS – just to name a few. “They actively align the interests of all stakeholders, rather than just balancing them… and can do seemingly contradictory things like pay high wages, charge low prices, and achieve higher profitability.” Indeed, the finance experts seal the deal: “The public FoEs brought returned 1,026 percent to investors over the 10 years ended June 30, 2006, compared to 122 percent for the S&P 500; that’s more than an 8 to 1 ratio! Over a 10-year horizon, FoEs outperformed good-to-great companies by a ratio of 3.1 to 1.” While the journey to customer centricity is still underway for these companies, they differentiate themselves from their peers by seeing things the way they are customers see them and adjust their day-to-day decision-making accordingly.

Don’t bastardize customer-centricity

When the term “customer centricity” is used, it is often used incorrectly! It is overused in an attempt to gloss over selfish approaches. Claims of customer focus are too often made from the wrong perspective by companies. So many people see this as a buzzword, a jargon, something fleeting, a misguided concept. Your business can become customer-centric, but not just by saying so. This term contains deep and broad substance. Please don’t say it if it’s not really part of the fabric of your culture.

Customer orientation is not a form of interaction; It’s a way of life that needs to go beyond the frontline to include the domino effect of handoffs throughout the internal value chain across the enterprise. Mom and Pop businesses usually find this a necessary way of doing business, but as a company’s management expands it tends to focus on itself. Marketers, engineers, accountants, and everyone else in the value chain will only be customer-centric if they see their role as advocates for what matters to customers — if they put other endeavors first, they will always be at odds with customers stand and create waste, distrust and malevolence. These negatives are not initiated by customers, they are created by people within the company.

Customer centricity is a culture that does not “prevent” value for customers while maximizing value for customers. In a customer-centric culture, the well-being of employees and shareholders is pursued in the context of doing what is right for customers. This applies to both B2B and B2C. Very few companies have ever been truly customer-centric. But let’s be honest: since YOU are a customer, you know what it should really mean.