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Happiness, Leadership and Customer-Centricity?

What is the connection between happiness, leadership and customer-centricity?

On Happiness

A lot has been written about happiness. Not much of it speaks to me. And there are some speakers whose speaking resonates with me. Let’s start by listening to a wisdom master:

Happiness is almost not worth talking about because the instant you turn happiness into a goal it isn’t attainable any more. In other words, happiness isn’t something you can work towards.

- Werner Erhard

Let’s follow this up with the following quote which is in alignment with that which Werner Erhard is pointing at:

Happiness is not a station you arrive at, but a manner of travelling.

- Margaret Lee Runbeck

On Leadership

Many want what are presented as the trappings of leadership.  Few get the reality, lived experience, of being a leader and the exercise of leadership. What is the reality? I’d say it something like the following:

Being a leader and the exercise of leadership is not a destination you aim for or arrive at. Nor is it the path that you take. It is a manner of being-showing up in the world and travelling.

If that sounds a little philosophical for you. Then I share the following with you, courtesy of Shane Parrish at Farnham Street:

.. actually leading is different. A leader decides to accept responsibility for others in a way that assumes stewardship of their hopes, their dreams, and sometimes their very lives.….

It is mostly just hard work. More than anything else it requires self-discipline. Colorful, charismatic characters often fascinate people, even soldiers. But over time, effectiveness is what counts. Those who lead most successfully do so while looking out for their followers’ welfare. Self-discipline manifests itself in countless ways. In a leader I see it as doing those things that should be done, even when they are unpleasant, inconvenient, or dangerous; and refraining from those that shouldn’t, even when they are pleasant, easy, or safe.

- General Stanley McChrystal

 On Customer-Centricty

I’ll leave you with my take on customer-centricity which is manifested in many ways including creating-generating customer experiences that leave customers feeling happy, even delighted, in doing business with you:

Customer-centricity is not a station you arrive at. Nor is it the path that you travel. Customer-centricity is the manner of your showing up (in the world) and travelling.

I wish you a great day. And on this first day of a new year of living for me, I thank you for listening to my speaking. Your existence makes a contribution to my existence. Let’s work together to co-create a world that works for all.

 

Customer Centricity: A Sunday Morning Religion?

It occurs to me that customer-centricity has become a religion in many ways. And as such is characterised by a particular philosophy-ideology, rituals and practices. We have many books-articles published on customer-centricity, customer experience, CRM, customer service etc.  We have many gurus expounding their particular philosophy of customer-centricity. We have many consultancies pushing their flavour of customer-centricity and associated paths to customer-centric nirvana. We have the IT industry pushing an array of systems under the customer-centricity and customer experience banners.  And, we have many conferences centred on the topic of customer-centricity in one or more of its flavours.

What difference does all this make when it comes to lived experience – the real world of business?  I say that customer-centricity has become the new game to play: a charade. And in this sense, customer-centricity shows up for me as a Sunday morning religion.  This was brought home to me, recently, when listening to the advice given by an engagement manager to a project manager. It went along the following lines:

“Looks like you have a happy customer. Ring up the customer and ask if he would be willing to give us a 10. If he is willing to give us a 9 or a 10 then send him the NPS survey.”

Am I faulting the engagement manager? Not at all. The engagement manager through his instruction has simply made visible the game that has become the norm under the religion of customer-centricity.  How many Christian’s who turn up on Sunday morning are actually Christians?  By that I mean how many embody-live the principles-values-practices embodied by Jesus Christ?  Please note, I am not attacking Christianity. I find that the same has occurred as regards Islam: rare is the person I encounter who calls himself a muslim and shows up for me as being as such.

I ask you consider, be with, reflect on the following sage speaking by a sage:

The intricate maze of philosophy of different schools claims to clarify matters and reveal the Truth, but in fact they create confusion where no confusion need exist. To understand anything there must needs be the understanding being. Why worry about his bodies, his ahankar, his buddhi, creation, God, Mahatmas, world – the not-Self – at all? Why not remain yourself and be in peace? Take Vedanta, for instance: it speaks of the fifteen pranas, the names and functions of which the student is asked to commit to memory. Will it not be sufficient if he is taught that only one prana does the whole work of maintaining life in the body? Again, the antahkarana is said to think, to desire, to will, to reason, etc. Why all these details? Has anyone seen the antahkarana, or all these pranas? Do they really exist? They are all conceptual divisions invented by teachers of philosophy by their excessive analysis. Where do all these concepts end? Why should confusion be created and then explained away? Fortunate is the man [person] who does not lose himself in the labyrinths of philosophy, but goes straight to the Source from which they all rise.

- Ramana Marashi

I say put aside customer lifetime value. I say put aside share of customer wallet. I say put aside big data. I say put aside data mining and predictive analytics. I say put aside CRM and CRM systems. I say put aside Voice of the Customer and Customer Experience. I say put aside customer loyalty programs….

Now ask yourself some really hard questions and answer truthfully:

  1. am I/we willing to put the needs-concerns-wellbeing of the customer at least on par with our needs-concerns-wellbeing?

  2. am I/we willing to sacrifice revenues and profits (‘bad profits’) that I/we are making from taking advantage of our customers?

  3. am I/we hungry (passionate) about coming up with products-services-solutions-experiences that simplify and enrich the lives of our customers?

Amazon: Earth’s Most Customer-Centric Company?

Does Amazon deserve the label of ‘Earth’s most customer-centric company’?  Before I answer that question, allow me to tell you a little story about a well-known telecommunications company, one whose official strategy was to become customer-centric.

What Customer-Centricity Meant At A Well Known Telecommunications Company

I once did some consulting work for one of the world’s largest telecommunications companies. In the process, a certain kind of fellowship grew between me and the billing manager.  To some extent he was a frustrated man. Why?  The billing challenge was growing more and more complex: requiring more people, more expensive IT equipment, stronger oversight etc. .

What was the cause of the increasing complexity and thus challenge in billing?  The number of unique billing plans in place.  There were thousands of them. And most of them were legacy billing plans – many years old.  So I asked the billing manager, why he didn’t just move customers to the latest billing plans. And in so doing he would be free to delete the thousands of legacy billing plans that were the cause of the headache. Can you work out his answer?

He told me that he built a ‘business case’ and presented to his boss. Yet, the proposal had got nowhere because Marketing had vetoed is proposal. What was the basis of the veto?  The legacy billing plans were much more profitable for the company. Why?  Because compared to the latest, competitive, price plans, the legacy plans were overpriced.  And if the company took the decision to move these customers, arguably the most loyal as they had been with the company for a long time (3+ years), then this would mean giving away revenues and profits.

What did customer-centricity actually mean in this company? It involved lots of activity: vision statements, presentations, meetings, talk, customer research, mystery shopping, process changes, balanced scorecard.  What it did not involve was the conscious choice to do right by the customer: to put the wellbeing of the customer on par with the wellbeing of the company (revenues, profits, share price).

Does Amazon Deserve To Be Called The Earth’s Most Customer-Centric Company? 

We all know that Amazon works. It is easy to find and buy from Amazon. It is easy to keep track of where one’s order is. Amazon delivers the goods within the promised window. It is easy to return goods and get a refund. And on the only occasion something did not turn up when expected, I found it easy to get hold of Customer Services, and the call was handled by a friendly agent, who got my situation, validated my feelings, made  a promise to have the issue fixed by the next day, and it was fixed.

This level of performance has kept me doing business with Amazon despite my concerns over Amazon’s tax avoidance strategy, and the concerns about how Amazon treats the folks who work in the warehouses.  And to some extent my disposition towards Amazon has been a pragmatic one rather than one of affinity with what Amazon stands for.

This week the situation changed.  What happened? My wife signed up for the Amazon Prime offer and she then enrolled me into it as well.  As a result, I found renting and watching a movie (on demand) with my eldest son.  The experience of selecting, paying for, and watching the movie was effortless.

The next day, to my astonishment (I do not use the world lightly), I found myself reading the following email:

Hello, 

We’re contacting you about your recent attempt to purchase “The Wolverine”. We recently learned that a technical issue may have prevented you from being able to watch this video. We’re very sorry about this. 

To help make it up to you, we’ve issued a £3.48 for this order. The refund will be applied to your original order payment method and should complete within the next 2-3 business days. 

We look forward to seeing you again soon. 

Sincerely, 
Customer Service 
Amazon.co.uk 

Please note: this e-mail was sent from a notification-only address that cannot accept incoming e-mail. Please do not reply to this message.

Why was I astonished?  I was and continue to be surprised that there is a commercial organisation that gives!  What does it give?  Proactive service. An apology. A refund. And all on the basis that a technical issue may have prevented me from watching the movie!

Once I got over my astonishment who was I left thinking-feeling?  Given that I had watched the movie without any problems, and Amazon had been generous, I found a strong urge to contact Amazon and ask them to take their money back. Why?  Because, I was brought up to repay good with good, generosity with generosity, considerateness with considerateness.  Then I read the bottom of the email and found I could not reply to the email.

What did I find myself doing within 24 hours of receiving this email? I found myself buying a book, that I had been meaning to buy and had not bought, for £9 and watching a movie that I had not been intending to watch (this week) for £3.49.

Why did I do this?  It occurred to me that I could not treat badly one who has treated me well. And as such I felt a pull to repay Amazon’s ‘goodness’ by repaying the £3.49, which I did by buying and watching a movie on the day of the email.

If the acid test of customer-centricity is putting the needs-interests of customers on par with the needs of the company then I am in no doubt that Amazon is customer-centric.  Is this enough to show up as Earth’s customer-centric company? No. To win that mantle it occurs to me that an organisation chooses to prosper only by doing right by customers.  That is how Amazon shows up for me this week.  I cannot imagine any other company (that I am doing business with) taking the stance that Amazon takes in relation to its customers.

For those who are cynics, I get that Amazon may have taken a pragmatic decision to provide the refund so as to reduce the number of calls (and/or emails) coming into the call-centres.  Even if this is the case, then the action that Amazon has taken is smart. So at the very least the folks at Amazon are smart in a way that also benefits customers.

Taking a Deeper Looking at the Customer-Centric Ideology

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.

 

The Paradox At The Heart of Customer-Centric Business

I am no longer a fan of customer-centricity nor customer-centric business. I am not a fan of the way many are going about customer focus, customer-centricity, or customer obsession.  It occurs to me that the approach taken by many towards arriving at customer focus, customer-centricity, and customer obsession is not gold, it is fools gold.

Why? Because it occurs to me that an organisation that shows up as customer-centric does not centre itself on its customers. At least not in the simplistic sense that is being written-talked about, promoted and acted upon by many.

I get that I make a bold, even controversial statement, and it highly unlikely to win me applause. That is OK, given that my commitment is to write my truth and take a skeptical stance towards the dominant ideologies and practices.

I get that you might want to better understand why it is that I assert that which I assert here.  Allow me to point at, illustrate, and unconceal that which I am getting at here by sharing with you some quotes.  Let’s start with Emmy Van Deurzen, chartered counselling psychologist and registered existential psychotherapist:

…. one can never ignore the needs of others when making personal decisions but neither can one allow others to entirely determine oneself even when alone. This is a paradox

Yes, you do need to consider customers – their needs, their desired outcomes, their ‘jobs-to-be-done’, their preferences etc.  And you cannot run a successful business just by focussing on your customers. The game of business involves other players whose needs have to be considered.  For example, a facet of business life caught my attention whilst working with smaller businesses, which had not so gripped me for most of my life working in big businesses.  What facet? The critical importance of finding, hiring, organising, enabling, inspiring, channeling, and retaining the people who actually work inside the business to do that which is necessary to create value for customers.  It occurs to me that this is just as important for big businesses, it is not so evident because the dysfunctions of a demotivated workforce don’t show up as vividly in a huge organisation.  Or take a look at Zappos, its success is partly built on the way the founders and management team treated suppliers (as a valuable part of Zappos) and thus called forth co-operation from them.

Furthermore, if you simply follow what customers are telling you then you leave yourself open to the disruption caused by those who can see beyond what customers are saying in market research and customer surveys. Here, I share a passage from Matt Watkinson, the author of The Ten Principles Behind Great Customer Experiences:

It is not only consumers who have shifted towards other-directedness and ended up struggling: businesses have too. The dominant obsession with market intelligence, competitor analysis, and customer research is all about developing a more powerful radar, and the endless hand-wringing and strategising over social media betrays the kind of anxieties that are most often found in those eager for the approval of others.

In contrast, we most admire those businesses with a strong inner direction – a clear set of values, integrity and sense of purpose – and tend to lionise celebrity CEOs who bring that ethos to life…….. Customers churn between suppliers to find the best deal, not because we are all extremely price sensitive, but because there is nothing to be loyal to.

What Matt is pointing at here is that we are not simply the kind of beings that economics says we are.  Nor are we the kind of beings that rationalist philosophy, behavioural psychology, and scientific management assumes that we are.  The human being is a richer human being. A human being that strives for meaning and connection, open to being loyal to ideals, values, missions that elevate human life.

Finally, I want to leave you with wisdom from John Kay, an British economist:

If you want to go in one direction, the best route may involve going in another. This is the concept of ‘obliquity’: paradoxical as it sounds, many goals are more likely to be achieved when pursued indirectly. Whether overcoming geographical obstacles, winning decisive battles or meeting sales targets, history shows that oblique approaches are the most successful, especially in difficult terrain.

Obliquity is necessary because we live in an world of uncertainty and complexity; the problems we encounter aren’t always clear – and we often can’t pinpoint what our goals are anyway; circumstances change; people change – and are infuriatingly hard to predict; and direct approaches are often arrogant and unimaginative.

So let me remind you of my central assertion:

A customer-centric organisation does not centre itself on its customers. It is a paradox. And I say that it occurs to me that the way that many organisations are going about customer focus and customer-centricity, will not get them there. The path heavily promoted, and commonly taken, is fools gold.

Whilst I abhor combat, I do welcome conflict: conflict is simply the showing up of difference. And if difference is approached through the spirit of dialogue then it unconceals aspects of the world that are hidden from each of us. So if you disagree with that which I have written then please speak your mind, educate me, share that which you see and which I do not see.  I wish you a great day and thank you for making the time to listen to my speaking.

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