I say that the way to make a significant impact on the quality of the customer experience (as experienced by the customer) is for the organisation not to focus on improving the Customer Experience. That is a bold assertion and shows up as nonsense to many. So what is it that I am getting at?
It is my experience that after accessing the voice of the customer and doing the journey mapping a range of initiatives are on the table. So the folks around the table getting busy figuring out which initiatives to take forward. Which ones do they take forward? The ones that don’t rock the boat. The ones that are the least risky. The ones that are usually called low hanging fruit: the easy ones that involves a tinkering at the edges, and in the bigger scheme of things make little difference.
To Improve The Customer Experience Ramp Up The Quality Of Competition
Take a look at this photo. Notice, the people standing up – how many there are, and how closely packed they are against one another. I invite you to step into this picture. Imagine yourself standing up in this train. And finding yourself packed in like sardines in a tin.
I found myself on this train – standing up. This train was so packed that it took considerable skill to just get my smartphone out of my trouser pocket – to take this photo. How long was I standing up in this train? For one hour and ten minutes.
So I ask you how is it that this kind of occurrence is actually a regular occurrence on the trains going into and coming out of London at peak travel times? It is so because there is no competition. On each line there is one company that has won the right to run the train services. A monopoly is in place and the folks who need to use the train have no choice but to put up with whatever they have to put up with.
Now consider that the Tops of just about every business strive to minimise the competition. Why? Because where there is no genuine competition, Tops can ignore customers, and run the organisation in a manner that extracts surplus profits from customers.
Looking at the situation from the Customer’s point of view I am clear that the most effective way of causing improvements in Customer Experience is to effect genuine competition into every industry, every market place. Genuine competition for customers will force companies to do that which they are not willing to do today: focus on creating superior value for customers – that includes the Customer Experience.
I don’t know about your country, I do know about the UK. I assert with confidence that there is no genuine-significant competition in many industries: retail banking, grocery retailing (Aldi, Lidl are starting to make a dent), energy (gas, electricity) suppliers, telecom’s providers….
Consider that if business genuinely had the interests of customers at heart then the Tops of every business would welcome increased competition in their market place. Why? It would provide the impetus to do better: to focus on creating superior value for customers – including providing a better Customer Experience.
Is injecting genuine competition into a market place enough? Is it enough to ‘force’ the incumbents to pay attention to customers and do right by customers: focus on providing superior value for customers?
Effective Regulation Is Necessary To Make Competition Work
For two years I was leading a data mining and predictive analytics practice which operated across Europe. So I got to know something about how different countries went about implementing-enforcing the European Data Protection directive. Some countries were effective (Germany, France, Italy, Spain) and others (UK) ineffective. Why? The Germans, French, Italians, and Spaniard adequately funded their national data protection agencies and allowed them to levy unlimited fines (usually running into millions of Euros). I believe one of these countries set up the funding arrangements so that the data protection agency had to fund itself through the fines it levied on those companies found bending or simply not following the legislation. Whereas the UK government provided the minimum funding possible, and limited the fine that the national data protection agency could apply to £50,000.
Let’s get back to the issue of competition. Is it necessary for national governments to put in place effective regulations and enforcers of these regulations? No? Are you of the view that multinationals so love their customers, and are so committed to the Customer Experience, that regulation is not necessary? If so I invite you consider this: business, especially, big business is not customer friendly. Allow me give life to this assertion.
Yesterday I read this Guardian article: France fines 13 consumer goods firms €951m for price fixing. Which companies are involved? Companies include:
- Proctor & Gamble
- Reckitt Benckiser – €121m
- Unilever – 2nd largest fine, €172.5m
- L’Oreal – largest fine, €189.5m
- Johnson & Johnson
- Henkel (maker of Persil) – €109m
- Biersdorf (Nivea) – €72m
- SC Johnson
Which products were involved? As far as I can figure out, just about everything. Here’s what the Guardian says (bolding mine):
The price-fixing affected a large number of popular brands, such as Vanish stain remover, Palmolive washing-up liquid, Sun and Calgonit dishwasher tablets, Sanex and Petit Marseillais shower gel, shampoos including Head & Shoulders, Fructis and Elsève, and Colgate and Signal toothpaste. Mouthwashes, deodorants, shaving creams and razors, female hygiene products, body lotion, facial and sun creams and insect sprays were also affected.
So what went on? What did the folks at these companies do to merit such a large fine? This is what the Guardian says (bolding mine):
The regulator said the 13 companies ….. had colluded on price increases between 2003 and 2006. “These two sanctions are among the most significant imposed to date by the competition authority,” it said. The regulator added that the price-fixing had kept prices “artificially high” affecting consumersand “caused harm to the economy”.
…. commercial directors and other sales officials from the companies involved met “regularly and in secret” to co-ordinate price hikes at restaurants or via correspondence to private homes, as well as through telephone calls. The groups in which they met were called “Team” or “Friends”.
Consider that if business genuinely had the interest of customers at heart – were committed to creating superior value for customers – then business Tops would not only welcome regulation, they’d want it enforced rigorously and big fines handed out to those who cheat customers. Name me a Top that advocates this position – can you think of one? I cannot.
I say greed, selfishness and even corruption permeate our way of life. It permeates politics, national government, and local government. It permeates the police. It permeates business. It permeates the broader society – us. Given this context, I say, all talk of customer - customer focus, customer service, customer relationships, customer engagement, customer experience, customer obsession – is totally and utter bullshit.
Do you study history? I have. This is what I have learnt: every right that you/I enjoy today was earned and paid for through blood of brave souls many years ago. So if you and I are going to be treated right by folks in big business then it behoves us to fight for genuine competition in the market place, stronger customer protection legislation, and effective enforcement bodies. What you and I cannot count on is business itself: yes, the words have changed, and business as usual (screwing customers) continues unabated. I say that the true customer strategy of most business is something like this: blind customers with bullshit, and empty their pockets whilst they are not looking.
What can we learn from Havas Media’s 2013 Meaningful Brands survey?
For me, the highlights from the survey report are:
- Just 20% of brands worldwide are seen to meaningfully positively impact people’s lives;
- The majority of people worldwide wouldn’t care if 73% of brands disappeared tomorrow;
- Only 32% feel brands communicate honestly about commitments and promises;
- 54% of us don’t trust brands; and
- The meaningful brand index outperforms the stock markets by 120%.
It would appear that the case for making a shift towards a ‘meaningful brand’ is compelling according to Havas Media and yet most brands do not show up as meaningful. This shows up as interesting for me given all the talk-spend on brand, branding and brand building.
Let’s shift perspective and take a look at the situation through the eyes of Customer Experience.
What is the state of Customer Experience at the end of 2013?
In her November post, “Sucking Less” is Not a #CX Strategy, Annette wrote:
“Are organizations seeing the value of delivering a great customer experience? Clearly they pay lip service, but we know that actions speak louder than words. Do they really get it? No. There’s no real commitment of time, resources, and budgets to initiatives that improve the customer experience.
I spend a lot of time talking to prospects and clients about how to sell the value of customer experience to company leaders. It’s so disheartening …..”
My experience resonates with Annette’s. And our experience is not unique – talk with Customer Experience professionals and you get a taste of how difficult it is to move the Customer Experience ball beyond conducting VoC surveys and collating-publishing the results.
So what is going on here? If Tops are VCs and Customer Experience is seen as investment then the Tops do not see the value of investing in Customer Experience ventures.
What is the state of CRM at the end of 2013?
It occurs to me that large established companies have spent large sums of money in the name of CRM – usually in procuring and implementing so called CRM systems. What is there to show for this investment in terms of generating superior value for customers and cultivating meaningful profitable relationships with customers?
As I look around I find that the single customer view is just as elusive today as it was when Siebel was promising it, through the adoption of its CRM suite, back in 1999. The gulf between the talk and the reality continues to stun me. So many companies still struggle to work out the totality of their relationships (products purchased, interactions) with their customers.
I notice that many marketing, sales and service (customer, field) processes are just as broken today as they were in 1999. Why? Because too many people implemented CRM to automate the existing way of doing business.
It occurs to me that the challenge of getting the marketing, sales and service folks to genuine work together to build meaningful relationships with customers is beyond almost all companies. These functions and the people in them continue to work in silos, pursue their functional objectives, and work to their particular style.
I notice that the state of fragmentation within the marketing function is higher today than in 1999 due to the proliferation of digital channels. Marketing has become so complex that a whole industry, marketing automation, has grown up with the aim of automating marketing with a view to taking the complexity out of it.
Why do organisations continue to grapple with the same challenges despite their investments in CRM and Customer Experience?
Having been in the field since 1999 I am struck about how little has really changed despite all the changes that have occurred outside and inside organisations. What is going on here? Why is this the case?
It occurs to me that most of that which has taken place in the areas of CRM and Customer Experience has occurred in the domain of doing. And this doing has arisen from the same old domain of being. And as such, the mode of being has poisoned-corrupted all the doing. How best to illustrate this? Think King Midas. Whatever King Midas touched it became gold. Being has that kind of power: every action is tainted with the being that gives rise to it. Yet, those who have walked the CRM and Customer Experience path have been oblivious to this corruption because the the current style of showing up in the world is so taken for granted that it is invisible to us:
“The way of life of a culture is not an explicit set of beliefs held by the people living in it. It is much deeper than that. A person brought up in a culture learns its way of life the way he learns to speak in the language and with the accent of his family and peers. But a way of life is much broader than this. It involves a sense for how it is appropriate and inappropriate to act in each of the social situations one normally encounters; a familiarity with how to make sense of things and of how to act in the everyday world; and most general of all, a style, such as aggressive or nurturing, that governs the actions of the people in the culture although they are normally not aware of it. We can think of it as a cultural commitment that, to govern people’s behaviour, must remain in the background, unnoticed but pervasive and real.“
– All Things Shining, Hubert Dreyfus and Sean Dorrance Kelly
This sense of the being, of the default ‘style’, of organisations (and the people who work in them) is spelled out clearly by Vik Maraj in an interview published on the Huffington Post where he talks about the challenge of transforming the not for profit sector:
“Question: What is the over-arching challenge in the not for profit sector?
Answer: We act mostly inside of a context of charity not empowerment. Very few people are “learning to fish”. And this is a societal issue not just a not for profit issue.
Question: With respect to the not for profit sector, what is the truth that we don’t want to talk about?
Answer. We compete with each other with a smile on. We protect ourselves. And we collaborate in an opportunistic way. And the game is rigged such that this behaviour is almost inevitable. And the rigging is usually done by a decades old governmental policy…….
At first some of the obvious challenges are a lack of funding, a lack of resources, a lack of volunteers, turnover, a lack of being valued, lower salaries, lack of training and development, lack of policy, political unwillingness, the economy, etc. There are many more that I have not mentioned and what they all have in common is that none of them are the real problem.
Question: What’s the real problem, and what’s the answer?
Answer: The real problem is that we don’t collaborate and align our vast, often duplicated resources, talents, and mandates, to have a collective voice. Collaboration is both a missing mindset as well as a missing process. We mostly define collaboration as “getting together”. As one of our clients said, “[we act as] independent islands chipping away at symptoms”.
Almost all transformative change started with a series of small groups led by a few courageous people. They came together to tell the truth to one another, did the tough work to get over their differences, and then whole-heartedly went after an intolerable circumstance that each could not surmount on their own! The answer is to move from a “me or you” mindset to a “me and you mindset” and to stop pretending that we are always noble or even often noble!
Question: If this is the answer, at least one powerful answer – so then why aren`t we doing it?
Answer: Good question. Given the common goals, overlapping skillsets, and in many cases overlapping client bases and services, why aren’t we truly collaborating and coming together to increase the power of our voice and share resources, information, and talent? Why? The answer is that there is too much self-interest and survival thinking to allow for this. Making it and surviving forms an almost inescapable context within which people operate.
If you are awake and have any lived experience of the for profit sector you will see the parallels.
Summing up, excellence in CRM and Customer Experience requires a transformation in the character (being) of organisations (and the people in the organisations especially the Tops) not just a change of clothes to project a more ‘customer friendly’ personality. This is a challenge that few have taken on wholeheartedly – arguably the CRM and Customer Experience fixes were actions designed to bypass the need for a genuine shift in being, in transforming from extractive capitalism to conscious capitalism.
In response to an earlier post (The Paradox At The Heart of Customer-Centric Business) Christopher Frawley commented:
Maz, your post is both intriguing and confusing. You’ve stated what you’re against, but I’m not sure that you’ve clearly articulated what you’re for. You do make the point about business being an ecosystem that’s larger than the customer and yes that’s true.
I would argue that the decisions you make about hiring, treating suppliers, revenue models, etc. are all in service to meeting and exceeding the needs of customers – the reason you have a business at all. All the questions about how the business operates should be answered through the lens of with what will help us do the best job for customers in the marketplace.
So many have awakened to the reality that more outward attention must be paid to the customer and you may consider much of what’s being said and done simplistic (as you stated). If a customer centric business does not center itself on its customers, then what if anything is at the center and/or what should it be? Thanks.
It occurs to me that Christopher makes good points and is asking questions worth asking. So the least that I can do is make the effort to grapple with his questions and share that which shows up for me.
I say that all of us talk a lot of nonsense and mostly we are not present that it is nonsense. Why? Because we fall in with the customs and fashions of the day. Whilst thoughts may show up for us, most of us rarely think. It occurs to me that a lot of nonsense has been talked about in the Customer domain by those who have something to sell to those who buy the nonsense.
Is business about meeting and exceeding the needs of customers?
Is it a God given commandment that the purpose of business is to meet-exceed the needs of customers? I haven’t seen it any of the holy books so it occurs to me the answer is no. Perhaps a better question, given that we worship at the altar of science, is to ask if meeting-exceeding the needs of customers is a scientific law. Can you and I agree that science has nothing to say on this matter, it is silent?
Which begs the question, who says that the reason you have a business at all is to meet-exceed the needs of customers? In grappling with this question, I ask you to consider that the taken for granted view (embedded in company law in USA, UK) is that the duty of management is to run the business so as to maximise the returns to shareholders. There is no mention of customers. There is no duty towards customers other than those duties imposed by consumer protection legislation. Do you not find it interesting that consumer legislations has been enacted to stop companies misleading even abusing customers?
Do entrepreneurs risk all so that they can meet-exceed customer expectations? I have had the privilege of working with some entrepreneurs. Based on that experience, it occurs to me that the answer is no. Some entrepreneurs start their businesses to escape the rat race. Others because they see an opportunity to make a lot of money. From what I have read, Steve Jobs did it to ‘make a dent in the universe'; Jeff Bezos did it because he did not want to regret missing out on the possibilities created by the internet; Tony Hsieh did it because he loved building businesses; Chris Zane did what he did because he found himself good at fixing bicycles….
Back to the central question and let’s ask this question differently. What is the basis of the assertion that the reason you have a business at all is to meet-exceed the needs of customers? The common answer is that it is the customer that pays the wages. Let’s take this to mean that without customers there is no viable business. Agreed. Now consider this question. What happens to a business if the people who work in the business all drop dead? What happens if the employees get together and go on strike? Is this business a viable business? I say no. If you think otherwise, then ask yourself why it is that USA and the UK governments and business establishment have sought to undermine unions and union power.
Let’s consider the energy companies in the UK. It is arguable whether they meet and exceed the needs of their customers. A fundamental need is for transparent pricing plans so that customers are in a position to make the right choices. The energy companies have done and continue to do all they can to stop customers getting this need met. These energy companies make huge profits by structuring the market to meet their needs – needs of top management and shareholders.
It occurs to me that business is as much about meeting-exceeding customer expectations as my life is about breathing, drinking and eating. Which is my way of saying that in the same way that it is simplistic to reduce my life to breathing-drinking-eating, it is simplistic to reduce business to meeting-exceeding customer expectations.
You may disagree. In that case can you and I agree that I have shared with you sufficient grounds to at least question the God given status of the truth of the assertion ‘business is about meeting-exceeding customer expectations’?
Should all business questions be answered on the basis of what will help us to do the best job for customers?
To answer this question, it is worth getting present to something: customers don’t exist. How to point this out more concretely? When i-you say “all business questions should be answered on the basis of what will help us to do the best job for customers” which customers are we talking about? Are we talking about the customers which are most profitable for us? The customers on which we are losing money? The customers where it occurs to us we have the most potential to grow their wallet share with us?
In ‘Onwards: How Starbuck’s Fought for It’s Life without Losing It’s Soul’ Howard Schultz draws attention to the real world – the world of messiness. Under the previous CEO, Starbucks had expanded rapidly to please Wall St. When an analysis of the stores was done there were 100s of stores that were simply not viable. So the decision was taken to close these stores. What happened when customers of these stores found out? Some customers wrote in asking-pleading for the stores to be kept open. Why? Because the Starbucks store played such a central role in their lives. What happened? Howard and the team listened, did the maths, and closed the stores.
When the folks at Apple were playing around with the technologies that would eventually constitute the iPhone were they doing so in order to meet-exceed customer expectations? Or was Steve vested in creating-building a phone that he enjoyed owning-using? I wasn’t there so I do not know the definitive answer. The writers (that I have read) say that Steve was concerned with creating a phone that he and his family-friends would enjoy owning-using. The effect of succeeding in creating such a phone was that of exceeding customer expectations. Yet, it was not customer expectations that drove the investment, effort, or passionate commitment to creating the iPhone.
Then there is Clayton Christensen and his theory of disruptive innovation. As I understand, Clayton Christensen makes the claim that successful companies become good even great at building a business around a highly profitable group of customers. And in the process they ignore other customers thus creating an opening for innovative disruptors. Consider Amazon, how is it that Amazon has become the giant of book retailing? I say it is in part because the incumbents were to busy answering question on the basis of their understanding, and investments, in doing the best job for customers who bought their books – the people who turned up, looked at and bought books in the store.
Can you and I agree that the game of business cannot be reduced to any simplistic formula. Including, ‘all business questions be answered on the basis of what will help us to do the best job for customers’?
What is my big issues with customer-centricity?
Life is messy. Life is full of polarities, contradictions, and paradoxes. Business is a realm of life and as such the game of business is messy, non-linear, full of polarities, contradictions and paradoxes. This is not a realm in which simple minded thinking, simple minded formulas, and simple minded approaches are effective. It occurs to me that too many of those working on customer focus, customer experience, and customer-centricity are falling into this simple minded trap.
Consider that the success of Amazon is as much on its ability to deliver the goods to the customer quickly as it is about its website. And that Amazon lives by the principle ‘the best service is no service’ – ensuring that everything works just right so that there is no need for the customer to contact customer services.
Consider that the success and value of Apple is tied to the ability of its people to come up with ‘magic products’. And Apple invests in on helping its customers make good use of these magic products. How many folks working on the customer experience even consider these two domains?
Consider that Ryanair has been hugely successful by enabling people who would not normally fly (as they could not afford flights on the likes of British Airways or Aer Lingus) to fly. It occurs to me that Ryanair is a great illustration of Clayton Christensen’s theory of disruption. By tapping this unmet need the folks at Ryanair have been getting away with treating their customers rather badly in terms of service, fairness, and charges.
Consider that Tesco was held out as the exemplar of taking a data driven, customer-centric approach to retailing. What is the case today? Tesco has been struggling since the recession whilst the likes of Waitrose, Sainsburys, and Aldi are doing rather well. So perhaps data driven retailing is not the magical formula for business success.
Consider that the John Lewis Partnership (John Lewis, Waitrose) have been growing from strength to strength – this is a business where the employees own the business and where their rights and obligations are enshrined in a legally binding constitution.
My primary interest is human beings. The value that I most value is empathy. I find myself moved by the kindness-connection-helpfulness that flows when empathy is present. I have noticed breakthroughs in relationship often generate breakthroughs in performance. Which is why I was happy to take up the offer to read-review-share Mark Ingwer’s book Empathetic Marketing.
Let’s start with a passage that gets to the heart of the challenge:
The range of what we think and do is limited by what we fail to notice. And because we fail to notice that we fail to notice, there is little we can do to change until we notice how failing to notice shapes our thoughts and deeds.
– Daniel Goleman, Vital Lies, Simple Truths: The Psychology of Self Deception
What is it that we fail to notice? I say that we fail to notice that human beings are not just automatons, computing algorithms, merely rational beings. We fail to notice that human beings are emotional-rational-social-embodied human beings. And this has consequences for how we treat customers, treat employees, treat suppliers, treat ourselves. It has consequences for the quality of our relationships and our performance.
Mark Ingwer says we fail to notice the nuances that make us human
What does business psychologist Mark Ingwer say? He says:
What we fail to notice is the powerful effect of our unconscious on behavior and personalities.… To truly understand why people say what they say and do what they do, we must look at the psychodynamic context surrounding consumer decisions.
…. when faced with many options and advertisements ….. we often decide what’s best for us by gravitating towards what feels right (or frequently away from what feels wrong).
Even when they claim to desire lifetime relationships with their clients and customers, many businesses tactically distance themselves from the humanity of their interactions. The systemic nature of marketing and business strategy inadvertently depersonalises their audience by using language that groups customers into market segments and targets. People are commonly referred to as “buyers,” shoppers,” “payers,” “non responders,” “early adopters,” and “eyeballs.” But too often what is lost is the nuance that makes them human.
Why does this matter? It matters because when we do not keep ‘the nuance that makes us human’ at front and centre of our business decisions then we create products and services which flop. We spend fortunes in business to get people to buy our products – become customers – and then we neglect their emotional needs for the rest of the ‘customer journey’. This is what Mark Ingwer says:
I contend that emotions and resulting behaviours are the foundation for satisfying complex psychological needs…. And individual’s needs are satisfied when he or she is connected meaningfully to others, and through these connections comes to find his or her own unique value and identity. It is a ceaseless, evolving, lifelong endeavour.
.. businesses must have an intimate and conceptual framework for understanding these emotional needs and a passion for meeting them every step of the way.
The heart of the matter: putting full bodied humanity into business?
It occurs to me that Mark Ingwer is pointing at that which shows up for me as the heart of the challenge: putting humanity into business so that the one dimensional picture of human beings becomes alive in all of its many dimensions. There are three sentences in particular that resonates with me and I wish to share with you:
Physical needs create life and keep us living, whereas the emotional needs alluded to earlier are what make life worth living.
Meeting needs is not like climbing a mountain. It’s more akin …. to a lifelong game of tug-of-war.
We are beings in conflict, individuals attempting to engage with our many needs outwardly and subconsciously.
What are the fundamental needs that drive shape-drive human behaviour?
Which begs the question, what are these fundamental human needs that shape-drive human behaviour? Mark Ingwer calls attention to two needs in particular: individuality and connectedness. This is what he says:
Throughout life’s stages, we balance our primary needs for individuality and connectedness…… These two needs underlie most all human motives and serve as the polar forces of a needs satisfaction model, which I call the Needs Continuum.
Sitting on the left-hand side of the continuum, our need for individuality finds a way to sneak into almost all of our behaviour. Western society values the stalwart, self-reliant man….. We subconsciously take and borrow from every one of our relationships and connections in the world to arrive at a better sense of self.
Sitting at the opposite pole of the continuum, the need for connectedness moves hand in hand with individuality …… The need for connectedness motivates us to prioritise friends and family. We often want to buy higher quality goods and services ……. for them them than we do for ourselves. Connectedness …. defines our role as social beings. It’s impossible to live our lives without others with whom to share it. We must be cared for, loved, nurtured. We must be recognised. We must belong to something larger than ourselves.
We need to seek and achieve connectedness in order to thrive and truly know ourselves. Other people are mirrors through which we develop and sustain identity…..to be connected to others is to open the door to sustained personal growth and happiness.
On the continuum between individuality and connectedness are the following six core emotional needs: control, self-expression, growth, recognition, belonging, and care.
When approaching customers or prospects, a business must understand which of the six core needs its products or service addresses and then tailor its marketing and product development to best address that core need
In the next post on this series (based on Mark Ingwer’s book Empathetic Marketing) I will explore the powerful human need for control.