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2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 1)

Yesterday, I received one of the few publications I find worth reading. Which publication? The 2014 UK Analysis put together by Nunwood‘s Customer Experience Excellence Centre.  In this series of posts, I will be sharing with you my take on this report and its findings and recommendations.  Let’s start with the dominant themes.

Little Change In The State of Customer Experience Excellence From 2013

The foreword by Marketing Week is full of the kind of exaggeration-hype that goes with much of marketing:

With customer experience now firmly established as the main competitive battleground for ambitious leaders, this is a uniquely rich insight into the best practices needed for success…..

- Mindi Chahal, Features Writer, MarketingWeek

Did you get the clue?  The clue lies in the adjective ambitious as in ‘ambitious leaders’. It turns out that of the 250+ brands surveyed by Nunwood only a very small number are ‘ambitious’. And as such little has improved overall as regards the state of customer experience excellence in the UK.  Which kind of makes me question the claim that customer experience is now firmly established as the main competitive battleground. My experience is that whilst it is talked about, that is pretty much all that happens: talk.

What do the folks at Nunwood say on this matter? This is what they say (bolding is my work):

A minority of brands are shining every brighter …… These examples of brilliance are dimmed by the larger set of brands whose efforts have stalled. Either because they have hit cultural glass ceilings …… or the ambition of their leaders has failed to match the rising expectations of UK consumers … This has meant that across all 263 brands analysed the overall improvement in performance was less than 1%. 

The Biggest Improvement In Customer Experience Excellence Has Occurred In The Financial Services Sector

Which sectors show an improvement? Three of them: financial services, entertainment & leisure, and travel & notes.

Which sectors are stagnant? Three of them: telecommunications, restaurants & food, and non-food retailing.

Which sectors have declined? Two: utilities, and grocery retailing.

Did the financial services sector make the 2.2% improvement due to benevolent-enlightened leadership? Or a new found love of the customer? Or was it because some teeth have been put into a regulator and regulation?  Here is Nunwood’s take on the situation (bolding is my work):

The financial services sector sees the largest improvement in performance …. This is in no small part due to the burning platform created by the government, media and regulators. New FCA-mandated focus on customer outcomes … has led to massive investments and exhaustive leadership attention.

It occurs to me that here we have a clue as to why there has been little or no change in all the other industry sectors. Organisations and the Tops that lead them do not willingly stop screwing their customers and employees. And so switch from the easy and established way of making ‘bad profits’ to doing the hard stuff of generating superior customer value and thus reaping ‘good profits’. This kind of behaviour is arrested and weakened through a combination of effective regulation and sustained media pressure. Which may explain why it is that the utilities sector, which has been the weakest in terms of customer experience excellence has slipped further down the rankings. In my view-experience the Ofgem, the regulator for gas+electricity market, is about as toothless as you can get.

The Same Brands Continue To Shine And Some Shine Less Brightly

By now, I suspect that you may really want to know who the UK’s Customer Experience leaders are. Here are the top 10:

1. First Direct (bank without high street presence)

2. John Lewis (multichannel retailer)

3. QVC (tv based shopping channel)

4. Lush (retailer)

5. Amazon (online retailer)

6. Appliances Online (online retailer of appliances)

7. Waitrose (grocery retailer)

8. Nationwide (building society, financial services)

9. Specsavers (retailer)

10. M+S Simply Food (grocery retailer)

10. Your M+S (retailer)

Here are my take on this Top 10 list in comparison with 2013:

  • Virgin Atlantic and Ocado have dropped out of the Top 10. Virgin is now at number 21, and Ocado just outside the Top 10 at number 12.
  • Appliances Online, Nationwide, and Specsavers are new to the Top 10. This is what Nunwood says about Appliances Online (ao.com):

A clear value proposition wedded to an excellent service culture sets the brand apart.

  • Amazon continues its slide down the rankings here is what Nunwoods says:

Amazon …… continues to slip slightly in the rankings for the third year in a row, as consumers react to declining perceptions of its integrity and the performance of its delivery companies.

  • Waitrose ascends the rankings moving from being number ten (2013) to being number 7 (2014).

  • M+S (both Simply Food, and Your M+S) descend towards the bottom of the Top 10 in 2014.

My personal take is that Your M+S is a retailer in trouble. Management, probably in desperation, are bullying store managers. This then cascades down to the people on the shop flower. And in turn impacts the customer experience. So it will be interesting to see where Your M+S stands in the 2015 rankings.

The Secret of Customer Experience Success: Put Your Customers Second

You may have noticed that I insist on the need for and the critical importance of the human dimension: calling forth and putting into play the best of our humanity in order to orchestrate great relationships and generate great experiences. In short, to create a better world, a world that works for all: employees, suppliers, management, customers, shareholders, and the community.

More than once I have spelled out that the access to great customer experience lies through the folks that actually interact with and serve customers: the people working in the business and especially those who interact with and serve customers on a daily basis.  Not technology! Technology can enable or hinder the customer experience. It is merely a tool.

Which means that there cannot be excellence in Customer Experience without excellence in Employee Experience. And these two have to be in tune with one another.

What does Nunwood say on the matter?  Here is what Nunwood says (bolding is my work):

With only a single exception, the top 10 ‘Champion’ brands are characterised by their evangelical employees and superior cultures. Employees who are exceptionally proud of the brand they represent and the job they do each and every day for customers. Their culture plays a pivotal role in creating outstanding customer experience and they value that some culture first and foremost. In a very real sense, employees come first and customers come second. 

Which is the single exception? I take it to be Amazon. And in the longer term this could be the undoing of Amazon.

Enough for today, I will continue this conversation in the next post. In that conversation I propose to explore the underlying factors that show a correlation with Customer Experience excellence.  Until then I wish you the very best.

Looking Under The Hood Of Customer And Employee Engagement

A Skeptical Look Under The Hood Of Customer Engagement?

Why is Customer Engagement so fashionable?  Is that because Tops, Middles, and Marketers have found Jesus and come to love the Customer? I say “No!”

It occurs to me that Customer Engagement has become fashionable because marketers have found it increasingly difficult to get the customer’s attention long enough to exercise their dark arts of activating-influencing-manipulating human beings to want what the marketers are paid to sell.

Put differently, the purpose of the bag of tricks that falls under fine sounding rhetoric of Customer Engagement is to get customers to march in tune with the marketer’s agenda: tell us about yourself so we can sell your data and send you marketing messages; buy from us and buy more from us; and sell us, and for us, by recommending us to your social network.

I say Customer Engagement is a Taker’s way of taking whilst masking-disguising the taking that is going on. Is it then a real surprise that whilst there is so much talk of Customer Engagement, there is so little in the way of success?  Which might explain why the masters of the dark arts (those who advise-assist marketers) are busy inventing new tools-tricks for taking. And why marketers continue to fall for the latest tool-trick?

You may not be as skeptical as me; being skeptical as opposed to trusting-gullible is the norm, that is our default wiring.  So I invite your to play a mind game. Imagine that every company that is busy with Customer Engagement scraps their existing engagement tools-tricks. Instead, customers vote and choose their champion: the customer champion. This customer champion is invited to any-every discussion in the business which makes decisions that impact customers. And no decision can be made without the agreement of the customer champion.  In giving his/her consent the customer champion solicits the views of the people he represents: the customers.  Is this not real engagement with customers?  Then ask yourself if any business/organisation is doing this today. How many names have you come up with? Who even gets close to something like this?

What Is The Alternative To Customer Engagement?

If you showed up and travelled through life as a Giver how would you approach the Customer challenge?  I say that you would not be asking yourself  the following question: “How do I get the customers to engage with me and my agenda?”

It occurs to me that as a Giver you would be grappling with the following kinds of questions:

  1. How do I create superior value for my customers?
  2. How do I make their lives simpler-easier?
  3. How do I enrich the lives of our customers?
  4. What will it take for our organisation to leave customers feeling happy doing business with us and grateful that we exist?”

A Skeptical Look Under The Hood Of Employee Engagement?

Why is it the Employee Engagement is so fashionable? Is it because Tops, Middles and HR folks have found Jesus, recognised the universal brotherhood of man, and come to see the folks that work in the business as fellow human beings – of equal worth and value? I say “No!”

It occurs to me that Employee Engagement has become fashionable because the business place is so competitive. As such there is tremendous pressure on organisations to increase productivity and cut costs.  And for some organisations, there is the added pressure of generating knowledge and converting this knowledge into new products, new services, and better (cheaper) ways of doing things.

Imagine one of the Tops getting up and saying: “We are keen, even desperate, to get as much knowledge-innovation-work out of our human resources as possible whilst paying the absolute minimum that we can get away with paying.”  How much better, upstanding, uplifting, it sounds for a Top to talk about Employee Engagement.

I get that you may think that what I speak here is far-fetched. Let’s put that to the test. Imagine every company that is touting Employee Engagement goes to their employees and asks them to vote for and nominate an employees champion. And once this champion is appointed, s/he has to be presented in any-all discussion that affect the lives of the employees. And that no decisions that affect employees can be made unless the employees champion gives his/her agreement.  Now tell me how many companies that you know which practice anything like this.

I say Employee Engagement is just another term devised by Takers to disguise their taking. And I am clear that most employee are wise to this. Why might just explain why there is so little ‘engagement’ and genuine collaboration in the very companies that are touting Employee Engagement and devising-implementing the latest bag of tricks dreamed up by those passing themselves of as masters of manipulating people (psychologists, social scientists, academics, consultants, change agents..).

What Is The Alternative To Employee Engagement?

I say that if you genuinely care about your fellow human beings you would never refer to them as human resources. Just get present to this term: where is the dignity in the term human resource?  When you get home do you refer to husband/wife/partner and children as human resources?  Do you view-call your friends and members of your social network human resources?

So how would you treat your employees if you showed up and travelled in this world as a Giver?  Allow me to ask the same question differently. What are the kinds of questions you would be asking yourself if you genuinely cared by the wellbeing of your employees and the business?  I say that you would be grappling with the following kinds of questions:

  1. What kind of workplace is most likely to show up as a great place to work for the people who work (or we want to work) in our organisation?

  2. How do we involve our employees in the key business decisions especially those that affect them and their interactions-relationships with our-their customers?

  3. How do we shape what we do and the way that we do it such that this resonates deeply with that which provides genuine meaning, uplifts our employees, and calls forth the very best they have to offer?  What is it that we are doing-causing in the world that is speaks to and is worthy of the very best that lies at the deep core of our employees?

  4. How do we make sure that we share, equitably, the fruits of the creativity-knowledge-innovation-work that flows from our employees?

I welcome your thoughts on the matters I have touched upon here.

What Is The Access To Cultivating Customer Engagement and Customer Relationships?

My eldest son is in the process of buying a car, his first car.  He knows his budget (£6,0000. He knows the make and model of the car (Ford Fiesta).  Given this he knows that he will buy a used car – couple of years old.  His goal is to have this car in place by the end of this month.  His challenge is that he has never bought a car before.

What comes with this goal and challenge?  Concern. What is he concerned about?  He is concerned that he will get it wrong: that he will buy the wrong car – it is not sound; and or that he will pay too much for the car.  What does he want?  He wants help: he wants someone he can count on, who has his best interests at heart, to take the problem off his hands.  So he turned to me.

I have no experience in buying cars. My youngest brother is into cars, has bought-sold many cars, and so I have used his services.  So when my son asked me for help, I found myself telling him that I was not in a position to help him.  This was his reply:

“You’re not any help, are you!” 

It is the way that he said this that got my attention.  It was a voice of mild anger and strong disappointment.  Why?  Is relationship missing?  No, we have a strong relationship and this has been the case since his birth. Is engagement missing? No, we are engaged in each others lives – sometimes more than I’d like it to be and other times less than I’d like it to be.

Reflecting on that which occurred it hit me that we value those who show up as useful to us given our circumstances and the ‘projects’ we are grappling with.  Put differently, if you show up as useful to me then I am open to entering into a conversation with you. And through a series of conversations-interactions a relationship emerges.

Looked at this way, it hits me that all the talk of, and focus, on generating customer engagement and building customer relationships through a variety of tips, tricks and technology is misplaced.  It is misplaced. It is foolish. It is a red herring – distracting from that which matters.

So where should our focus be? On usefulness! It is when we show up as useful that the gate towards conversation and thus engagement opens.  It is only when mutual usefulness is present, does trading occur.  And it is on the basis of the repeated conversations-interactions-trading that a relationship emerges. Consider that when someone no longer ‘shows up as useful’ and they want to engage with you, have a relationship with you, they show up as clingy-needy. What is it that almost all of us do when this occurs?  We distance ourselves from these people. Why?  The simply do not show up as useful to us given our circumstances and our ‘projects’.

Please note that it is not enough to be useful as in have a useful product, service or solution.  It is necessary that one ‘shows up as useful’ to those whom we wish to trade with.  That means that an essential task is to cultivate awareness of our usefulness – to all who matter.  This was brought home to me in a recent conversation when the lady at the table said something to the effect “Where were you three months ago?  Why haven’t I heard of you? You should make sure you are on the Gartner report.”

In 25+ years of business life, I can only remember a handful of conversations where the people who matter in organisational life (Tops, Middles) grappled seriously with the question of usefulness: how can we be useful and show up as useful in the lives of our customers?

 

Is customer experience and the voice of the customer the CMO’s salvation?

The Economist Intelligence Unit has recently published a report titled ‘Outside looking in: The CMO struggles to get in sync with the C-suite’, sponsored by SAS.  This report has showed up as rather interesting for me and I want to share with you that which has caught my interest.

CMO’s face a number of big problems

The fundamental problem is that CMOs don’t get much respect from the rest of the C-suite.  CMOs say that they are doing a difficult job well: making a contribution/delivering significant value to product development, sales and customer service.  The problem is that the rest of the C-suite don’t agree – they question the value/contribution that CMOs are making.  And it doesn’t look like they listen to CMOs with much respect.  Here is how the EIU report puts it:

“CMOs believe they are constrained because the rest of the organisation does not consider marketing to be strategic; the C-suite believes marketing has not earned the right to be more strategic because it is ineffective at demonstrating value of its investments.”

Here are the other big problems that CMOs face:

1. Many organisations have trouble defining, clearly/exactly, the CMO’s role and responsibilities. Which could explain why it is that there is no agreement on what business objective the CMO (and the marketing function) should focus upon and be held accountable for.  Worse still there is a fundamental disagreement between what CMOs see as marketing’s priorities and the priorities that the other members of the C-suite assign to the marketing function.  Which makes me wonder if members of the C-suite actually talk with each other, share and agree what they expect of one another.  Doesn’t look like it. The EIU report says “..their greatest challenge: getting everyone to agree on marketing’s priorities.”

2. The  marketing function is not coping with the challenge that comes with the territory that falls under the market umbrella: advertising, brand, market research, communications, customer analytics, social media, mobile and so forth.  Why?  First, the marketing function lacks people with the necessary skills and expertise to cope/deal with this broad/dynamic challenge.  Second, members of the C-suite do not feel the CMO’s pain – they are not approving the necessary marketing investments.

So whilst it looks like CMOs are in a difficult position, there is no need to despair.  The EIU reports offers a route to influence, credibility, impact and respect from the C-suite.

What can CMOs do to make an impact and amass influence/respect in the C-suite?

The EIU report advises CMOs to focus on the customer experience and the voice of the customer. The authors pin their hopes on the following quote from Steve Cannon, CEO, Mercedes Benz USA:

“Every single customer experience is a brand moment of truth. If we create an aspiration through our advertising, and a customer walks into a store and does not deliver on that promise that reflects on marketing.” 

Any intelligent person could drive a coach and horses through this assertion.  And for the the time being lets just accept and go with this assertion.

OK, if Customer Experience is the unifying theme and the rallying call for the organisation then how exactly can the CMO contribute to this play given that the CMO is not the CEO and does not control all the touchpoints, which as a whole, generate the Customer Experience?

Focus on the voice of the customer:

Chief marketing officers (CMOs) stand a better chance of increasing their internal influence – and changing lingering doubts about marketing’s strategic contribution to the business – if marketing can consistently deliver insights and tools that benefit others across the organisation, from salespeople to call centre agents to merchandising teams.”

How feasible is this ‘success route’ being put forward by the EIU?

I say that there is a big difference between a poor strategist and a good strategist.  A good strategist takes into account feasibility.  Specifically, he asks this question: what is the likelihood that my client can execute this strategy?  And the good strategist keeps on going until he comes up with a strategy that the client has a good chance of being able to execute successfully.

So let’s ask this question, how likely is it that marketing can:

a) marshal the voice of the customer from all the disparate sources and turn this into a comprehensive view – single view of the customer;

b) generate actionable insight into customers, how they interact with the business as a whole, the jobs that they hire the business to do for them, and their experience of using the product and dealing with the company?”; and

c) inspire the various members of the C-suite to act – to make changes in their priorities, policies and practices – so as to improve the customer experience?

I’ll let you decide for yourself.  For my part I could not help noticing the following hurdles identified in the same EIU report:

1. Single customer view.  “The airline [BA] has spent the better part of the last decade integrating its systems to support the effort; data warehouse not stores 200 separate data sources from different parts of the business to provide a more granular view of the customer, based on information they have volunteered.”

2. Converting data into actionable insight. “For all the talk about data-driven customer insight, marketers are just starting to understand how they should be using the growing repository of information they are collecting through digital media and other channels.”

What do I say?

I say that if you and your organisation are serious about building your competitive position and commercial success on the Customer Experience then follow the example of Steve Cannon the CEO of Mercedes Benz USA.  Why?

Because, the role and this responsibility or organising the business around the Customer Experience is a huge change full of organisational politics. And as such it is beyond the remit and the capacity of the CMO and the marketing function.  This role/challenge – that of aligning the organisation around the customer experience requires marshalling resources, reassigning resources, engendering and dealing with organisational conflict – belongs to the CEO.

Here is what Steve Cannon did in the words of the EIU report:

“..aligning the organisation around a superior customer experience has been the focus of Steve Cannon since he took over as CEO in January 2012…. Investments in customer experience programmes have been large – such as the formation of a dedicated customer experience team – and small – like providing Mercedes Benz dealers with iPads equipped with custom apps and videos.” 

As regards what Steve Cannon is doing at Mercedes Benz USA I draw your attention to the following:

1. Steven Cannon was the CMO before he came the CEO.  When he was the CMO he did not take charge of “aligning the organisation around a superior customer experience” No, he did it when he became the CEO.  I say he is a smart man who has a sound grasp of reality.

2. If the CMO had come up with the clever idea of buying hundreds of iPads for dealers it is highly likely that he would have reinforced the C-suite’s already always listening of the marketing function as the “department of coloured pencils” (how one CEO described the marketing function) and s/he would not have got the budget approved by the CEO/CFO.

What do you say?

What does it take to generate ‘employee engagement’? (Part V – the ‘dark side’ of the being of human beings)

We are only falsehood, duplicity, contradiction; we both conceal and disguise ourselves from ourselves.”  Pascal

Truly it is an evil to be full of faults; but it is still greater evil to be full of them and be unwilling to recognise them, since that is to add the further fault of voluntary illusions”  Pascal

I have a confession to make.  So far (part Ipart IIpart IIIpart IV) I have deliberately given you a one sided – positive – picture of the being of human beings and thus your employees.  If you have read Fyodor Dostoyevsky’s novels (especially The Brothers Karamazov) you will get the true richness of the being of human beings.  And that includes the dark side – a side that the enlightenment and the humanistic philosophers and psychologists do not address adequately if at all.   In this post I want to address this darker side of being human in our age, in our organisations.

Why is it so hard to call forth ‘employee engagement’?

To create a contexts which calls forth ‘employee engagement’ is one of the hardest feats in traditional organisations.  Why?  There are two key reasons.

First, people – leaders, managers, employees – who have worked for more than a couple of years in command & control organisation have accepted and habituated in a particular mode of being and behaviour.  And it is difficult for them to change.  Why?  Because, contrary to accepted wisdom, human beings don’t have behaviours; behaviours have them!  When I write this I am thinking of both categories of people in organisations:  the managers and those who are managed and have come to expect to be managed – one category cannot exist without the other as they co-create one another.

The headmistress of the local Montessori children never takes on teachers that have gone through the traditional system and taught in traditional schools. Why?  Because she has found from experience that it is too hard to arrive at a place where these teachers embody the Montessori philosophy in their way of being in the classroom and the world.  After teachers have been teaching for some time in the traditional system it is practically impossible to get them to leave behind their way of being and making the shift to the Montessori way of being.  In a lots of ways these long timers experience the same kind of experience and success rates of feral children.

The second reason that it is so hard to get ‘employee engagement’ to show up is to do with the ‘dark side’ of being human that is always present and which we, with our obsession with the rational image of man, fail to acknowledge, accept and work with.  Let’s take a look at this ‘dark side’  – the shadow that is always with each of us.

The dark side: is this what really drives how human beings show up in the workplace, in the world? 

Peel back the onion to examine human behaviour and you might just find that the ‘machinery of being human’ seems to work to the following ‘four prime directives’ when it comes to dwelling with fellow human beings:

  1. Look good, avoid looking bad;
  2. Be right, avoid being wrong;
  3. Strive for control and dominate, avoid losing control and being dominated;
  4. Justify self, invalidate others.

It is worth pointing out that these four prime directives work at the level of the individual and the level of the tribe.   It is also worth pointing out that the root driver of these prime directives is most likely to be fear.  Fear of being excluded/ostracised like the lepers were.  Fear of being ridiculed.  Fear of being victimized/oppressed…..

How the drive for ‘employee engagement’ tends to play out

If these ‘four prime directives’ are not acknowledged and dealt with then the drive for ‘employee engagement’ tends to be a wasted effort at best and most often just a sham.  Why?  Because just about everyone in the organisation is first and foremost protecting himself.  That means those in manager roles don’t really let go of control – if they do then things might not work out and this will reflect badly on the manager and put his reputation/future at stake.  On the other hand those in the role of taking orders (including managers – junior managers take order from middle managers…) do not rise up and take responsibility for the fear of being setup to fail, being ridiculed…..  Now this dynamic does not just work at the individual level it also applies at the team level: marketing, sales, customer service, logistics…..  And it applies at the business unit level.  If you want a detailed understanding of the mechanics of this mutually reinforcing behaviour works then I recommend reading Power Up by Bradford & Cohen or The Responsibility Virus by Roger Martin.

In the next post I will share with you an effective process for generating employee engagement that has been used successfully by the corporate arm of Landmark Education.  It has a lot to do with ‘truth telling’ in the context of ‘creating a future that works for all parties at the table, none excluded’.

And finally

It is worth remembering that customers are human beings.  And as such they are also subject to these ‘four prime directives’.  Once you get this, really get it, then you have an access to all the stuff that you are doing as a corporation that is driving your customers nuts.  And how/why they are responding as they are responding.

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