As a thinker, I am struck by how rare original thinking is in the organisational world. As a thinker, I am struck by how little thinking – as in stopping and reflecting on that which is occurring and the pattern of this occurrence – occurs in organisations. As a thinker, I am struck by how little space exists within organisational life for ideas to be entertained and grappled with before the mindless rush to implement these ideas usually through some off the shelf methodologies, methods, tools and techniques.
I say that the idea of Customer Loyalty had power. And this power vanished when we rushed to turn this idea into practical customer loyalty programmes: loyalty cards, databases, offers and points.
I say that the idea of Relationship Marketing had power. And this power was drained and Relationship Marketing turned lifeless when the idea of Relationship Marketing was turned into the technology of CRM: systems that enslave human beings in data capture and script/process following slaves.
I say that the idea of Customer Experience has awesome power. And many are bleeding this idea dry, void of power, by turning it into the methodology of customer journey / touchpoint mapping, the blind worship at the voice of the customers, and the technology of Customer Experience.
What is it that I am getting at? Let’s see if I can communicate that which I am seeking to communicate to the practical people that dominate organisational life. I invite you to read the following words of wisdom (bolding is my work):
The word idea supposedly originates in the Greek word eidos, which means something seen like a form and a way of seeing like an eye, a perspective. So, ideas are not only things you can pick up and ponder. They also give you eyes, new ways of seeing things. Ideas are already operating in our perspectives, the way we look at things. We take our usual ideas for granted, and so, ideas have us rather than we have them….
Is the idea fertile, fecund? Does it make you think? Is it surprising, shocking? Does it stop you from habits and bring a spark of reflection? Is it delightful to think it? Does it seem deep? Important? …. This requires you to ponder it, which means weight it, feel its weight…. Pondering is an action of its own and keeps you holding the idea, from letting it go into other kinds of action before it is fully appreciated. Meanwhile you get a better feel of the idea….
You know, to have an idea and thinking about the idea are two different things, and being practical often means skipping over the hard thinking part…
For ideas to be therapeutic, that is, beneficial to the soul and body politic, they must gather into themselves, garnering force, building strength, like great movers of the mind’s furniture, so that the space we inhabit is rearranged. Your thoughts, feelings, perceptions, memories have to be moved around in new ways, because the furniture has been moved.
A long lasting idea, like a good poem or a strong character in a movie or a novel, continues to affect your practical life without ever having been put there. Ideas that live, live in us and through us into the world. Viable ideas have their own innate heat, their own vitality. They are living things too.
But first they have to move your furniture, else it is the same old you, with you same old habits, trying to apply a new idea in the same old way. Then nothing happens at all except the loss of the idea as “impractical” in your haste to make it “practical”.
- James Hillman, We’ve Had A Hundred Years of Psychotherapy And The World’s Getting Worse
It occurs to me that the conversations that take place here, at The Customer & Leadership Blog, are simply an ongoing exploration and pondering of the ideas of customer relationships, relationship marketing, customer service, customer loyalty, customer experience, customer-centricity, and leadership.
I am no expert, no guru, in customer relationships (CRM), relationship marketing, customer service, customer loyalty, customer experience, customer-centricity, nor in leadership. Yet, it occurs to me, that it might just be that I have grappled with these ideas at a deeper level than many. Therefore, any value that i create for you – the person who listens to my speaking – arises out of my willingness to stay with the idea rather than rushing to provide you with a silver bullet for your organisational ills.
Why I have shared this with you? To provoke thought: to provoke you into doing deeper thinking into the Customer realm before you go and buy the latest snake oil from gurus, experts, consultancies, and IT vendors. Incidentally, don’t reach for the dictionary to look up definitions of all things customer: customer service, customer relationship management, customer experience etc. Why? Definitions only provide the illusion of knowledge and understanding. There is no replacement for original thinking. A good start would be the following questions:
- What world of possibility does the idea of Customer Experience open up for us and our customers?
What might Customer Experience Leadership look like, feel like, sound like, taste like – for us, for our customers?
What is the first step on the journey of Customer Experience Leadership for us? Is it really getting access to the voice of the customer? Or is it doing that which we know needs to be done for our actions to be in tune with our words?
And finally, I invite you to consider that many if not most organisations have failed to make a success of relationship marketing, CRM, customer loyalty, customer experience etc because these ideas have failed to ‘move your furniture’ leaving the same old you, with the same old habits, trying to apply these radically new ideas in the same old way.
If you have made it this far into the conversation, I say thanks for listening. These conversations are not easy, not simple. This is deliberate – these conversations are designed to provoke thought from the thoughtful. They are not for the impatient looking for the ten steps to customer success.
Tesco: The Darling of Customer Marketing Guru’s Issues Its Fifth Profit Warning
Tesco continues to struggle. According to this piece from the Guardian newspaper, Tesco has issued its fifth profit warning, share price has plunged (down 16%): Tesco is on the floor. Why does this matter? Why is it worth me writing about. Let’s go back a little.
In the early 2000s Tesco was much lauded my many: the customer-centricity gurus, the 1:1 marketing gurus, the data mining and predictive analytics players, and customer loyalty program vendors. Tesco was the exemplar of harnessing customer data through a loyalty programme (Tesco clubcard), using data mining and predictive analytics to generate insights and then doing database driven marketing based on these insights. In the process Tesco went from being just one player amongst the UK grocery retailers to the the dominant retailer. At one point it looked like there would be no stopping Tesco.
Today Tesco is on the floor. Why? Because Tesco’s management ended up doing what management teams do: exploiting customers to extract surplus profits for the Tops and Shareholders. I think some wise person said something like “power corrupts: absolute power corrupts absolutely.”
What Can We Learn About The Challenge Of Building A Customer-Centric Organisation?
So what is it that you and I can learn from Tesco if we are grappling with the challenge of shifting a business towards a customer-centric orientation: one not based on using data/insight to exploit customers; one based on using data/insights to generate superior value (product, proposition, customer experience) for the customer? Here are the paragraphs from this Guardian piece that catch my attention (bolding is my work):
Lewis [CEO], who marks his 100th day in the job on Tuesday, said he was building “a new Tesco” that would eventually reward shareholders. “We need to get back to core principles. We need to improve the service and availability and that is what we are doing.”
Here is what strikes me, how I make sense of this statement based on my prior lived experience:
1. Moving an organisation from a business as usual (product-centred, extractive, short-term focussed) to a customer-centric organisation is akin to building a new organisation;
2. Building a new organisation is not simple, not easy, not quick. It requires the persistent application of substantial energy across a large number of people for a long period of time – years. Only a CEO who has the power and genuinely cares about the wellbeing of the organisation will do what it takes, and keep doing it over the long term of many years.
3. Part of the challenge in building a new organisation is sacrifice. This sacrifice especially involves shareholders. Why? Because usually the shareholders have gotten fat through ‘bad profits’ delivered by their agents (Tops) putting in place strategies-structures-people-practices that collectively take advantage of customers, suppliers, and the employees – extracting surplus rents (to use the term used by economists);
4. Building a customer-centric organisation is matter of getting back to core principles. Notice, it is not discovering some secret recipe nor the latest shiny miracle technology. It is about honouring already discovered, well known, rarely enacted, core principles. How does one honour a principal? By living it – being an exemplar of that principle in action.
What Specific Actions Does It Take To Be A Customer-Centric Retailer?
Let’s continue this conversation by looking at another paragraph that speaks to me. Here it is:
In a bid to improve customer service, the retailer has taken on 6,000 more staff since mid-October, and despatched 6,000 existing head office staff to spend one day a fortnight on the shop floor to get a taste for the sharp end of the grocery business. Lewis has decided not to lay off people after Christmas, a traditionally slack time for retailers, as part of this customer service drive. “Certain activities help you manage profits, but can have a detrimental impact on how you serve customers,” he said. “What we are trying to do is deliver better for customers … I believe that is the foundation from which we can build a new Tesco, which is financially attractive to shareholders.”
Here is how I choose to make sense of this paragraph:
- A customer-centric organisation is one which “delivers better for customers”. Delivers what better? Delivers better products. Delivers better service. Delivers better value propositions. I sum this up by saying it delivers a better Customer Experience.
Customer service is a key thread of Customer Experience. Organisation which seek to show up as customer-centric have to get customer service right. This is especially so for service heavy businesses where the employee to customer encounter is important, even critical.
Getting customer service right means investing in the people who actually are the customer service of the organisation. Please notice the word “are“. Your front line people are your customer service; they do not merely deliver the customer service that someone else (perhaps in head office) has already produced. This critical aspect of reality is much ignored: your front line people simultaneously invent-create-deliver customer service every time they encounter the customer – they are your customer service!
Investing in people is long term play. Think Warren Buffet: you select the right people and then you hold on to them over and for the long term. That means not laying people off during traditionally slack periods. Why? Because two way loyalty (sticking by one another) is essential to creating the context for greatness to show up from your people. When you, the CEO, take the pain for your people you are putting a deposit in the bank account of goodwill. And this allows you to draw on the goodwill of your employees when you need it. Think Market Basket.
The core challenge of building and then keeping in existence (over the longer term) a customer-centric organisation is this one: “Certain activities help you manage profits, but can have a detrimental impact on how you serve customers”. It occurs to me that this is THE most critical insight. There is a broad range of ingrained, celebrated, management practices that deliver the numbers over the short-term whilst at the same time chipping away at the quality of the Customer Experience. Over the shorter-term there is no visible impact. Then the hit occurs and when it does it is big. I refer to this as the ‘straw that broke the camel’s back’.
The people who collectively constitute the biggest obstacle to making the shift to a customer-centric organisation and keeping this customer-centric orientation intact (and effective) are the people who work in head office: those who make policies, set targets, dictate management practices…. I am talking about the Tops and Middles: those who work with concepts and not reality. John Timpson of Timpson recognised this and turned the role of the head office from a dictatorship to a helpline, and in the process reduced the number of people in head office, and moved them to the branches where the real work of interacting with and serving customers occurs.
Final Thoughts: Leadership and Governance
If find it interesting that the management practices that have brought Tesco to its knees ended up being unconcealed when an outsider (no relationship to the Tops running the organisation) took over the role of CEO; and
It is the competitive world in which Tesco competes which has forced Tesco’s leadership to deal with these management practices. It is only when that which had been hidden (bullying of suppliers by head office folks, bullying of store managers by head office folks, manipulating profits through shady accounting practices) could no longer be hidden that both people and management practices are being addressed.
It occurs to me that Tesco is in crisis as there has been a fundamental breakdown in leadership and governance. The Board of Directors failed to do that with which it is concerned. Ensuring that the right person/s are running the organisation. And overseeing the actions (and management practices) of these people. Interesting then that the Chairman of Tesco has had to walk the plank.
I thank you for listening to my speaking. And I invite you to share your thoughts and experience with me. Looking forward to reading your comments.
What Is Transformation?
For the purposes of this conversation, when I speak ‘transformation’ I am pointing at a radical shift in one’s way of being – as in one’s way of showing up and travelling in this world. If you are Christian, and know your Bible then think of the transformation (often called conversion) of Saul to Paul. What was intrinsic to this transformation? Was it not a letting go, a complete letting go, and embracing the unknown?
What Has Transformation To Do With Customer-Centric Business?
What has this conversation to do with all things Customer and especially customer-centric business? Everything. As I have said many times before a shift to showing up and doing business in an authentically customer-centric way requires a transformation: personal (Tops, Middles, Bottoms) and business (policies, practices, processes, tools).
a. What is the access to transformation?
What is the access to transformation at the individual (personal), and business (organisational) level? Allow me to share the following with you:
In some Asian countries there is a very effective trap for catching monkeys. A slot is made in the bottom of a coconut, just big enough for the monkey to slide its hand in., but not big enough for the hand to be withdrawn when it is clenched. Then you put something sweet in the coconut, attach it to a tree, and wait for the monkey to come along. When the monkey slides its hand in and grabs the food, it gets caught. What keeps the monkey trapped? It is only the force of desire and attachment. All the monkey has to do is to let go of the sweet, open its hand, slip out, and go free - but only a rare monkey will do that.
- Joseph Goldstein, A Heart Full Of Peace, Best Buddhist Writing 2008
OK, this Buddhism stuff shows up for you as ‘other worldly’ – unrealistic. So allow me to make it real for you.
b. The Transformation of Zappos Occurred in March 2003
Listen to Tony Hsieh talk about the early days of Zappos when the leadership team was struggling to find funding to keep Zappos going – the cash had run out (bolding is my work):
A month later, we still weren’t profitable. We still couldn’t raise funding.
But we had a decision to make.
How serious were we about this idea of making the Zappos brand be about the very best customer service? We had discussed the idea internally with our employees, and everyone was excited about the potential new direction.
But was it all talk? Or were we committed?
We hadn’t actually changed the way we did anything at Zappos yet. We did a lot of talking, but we weren’t putting our money where our mouths were And our employees knew it…..
For 2003, we were projecting sales to double, with about 25 percent of our overall sales coming from our drop ship business. The drop ship business was easy money. We didn’t have to carry inventory so we didn’t have any inventory risk or cash-flow problems with that part of the business. But we had plenty of customer service challenges.
The inventory feeds ….. from our vendors for our drop ship business were 95 percent accurate at best …. On top of that, the brands did not ship as quickly or accurately as our own WHISKY warehouse, which meant we had plenty of unhappy and disappointed customers. But it was easy money.
We all knew deep down inside that we would have to give up the drop ship business sooner or later if we were serious about building the Zappos brand to be about the very best customer service. We also knew that the bigger we grew, the more reliant we would be on the cash from drop shipping. There would never be a good time to walk away……
So we made what was both the easiest and hardest decision we ever had to make up until that point. In March 2003, with the flip of a switch, we turned off that part of the business and removed all of the drop ship products from our web site.
We took a deep breath and hoped for the best…..
We had to deal with our first test of our new direction right away. With a drop in revenue, cash was even tighter than before.
Now we had to figure out how to make next week’s payroll.
- Tony Hsieh, Delivering Happiness
Not easy is it? Which kind of explains why many organisations which talk about customer focus, customer obsession, customer-centricity are playing at the periphery: making process changes, buying-implementing technology etc. Which CEO or leadership team looks forward to taking a deep breath and hoping for the best?
If you are serious about cultivating genuine-meaningful loyalty between yourself and your customers then you have to open up your clenched fist. And let go of all the policies-practices-products-people that generate bad profits – profits made at the expense of your customers.
As Tony Hsieh says there is NEVER a good time to do this. So the best time to do that which goes with showing up and travelling the authentic customer-centric path is NOW! Why now? Get this, everything that ever happens, happens NOW. I know that this is not how it shows up for you, or me. And look into this, deeply, and you will see the truth of it. All action occurs in the present, NOW.
Here is where it gets interesting. There cannot be an organisational transformation unless it is preceded by individual/personal transformation; this individual/personal transformation has to start with the Tops – it is called leadership.
What is the subtitle of Tony Hsieh’s Delivering Happiness book? “A path to profits, passion, and purpose”. It occurs to me that the many with whom I speak show an avid interest in profits – increasing profits. Few show any interest in any purpose other than ego: self enrichment in its many disguised. Passion? Passion for great customer service, passion for great Customer Experience, passion for the genuine well-being of customers as fellow human beings? If you come across it then please share it with me.
I wish to acknowledge members of the ‘methodology police’, whom I met recently, for being the source of this conversation. Please note that for the purposes of this conversation I will use the terms formula, recipe, method, script, template interchangeably.
Is Success Reducible To A Formula/Recipe?
Is communicating with another reducible to a formula? Is relating and cultivating relationships with colleagues, clients, family and friends, reducible to a recipe? Does the co-creation of a ‘good’ customer experience yield to a predefined template? Does the successful implementation of a new CRM systems and the associated way of showing up and operating in the organisation yield to a specific method? Is great customer service reducible to a recipe? What about leadership: is the exercise of leading and leadership reducible to a formula?
YES. If I look at how it is that we show up and travel then it occurs to me that we operate on the basis that the answer is an unequivocal YES. Everything is reducible to a recipe: EVERYTHING. Which means that if the outcomes that we wish for are not showing up then the cause of the problem must be in one of the following domains:
- we are making it up as we go along as opposed to following a ‘proven’ formula;
we are not following the formula/method and as such we need to be manipulated (training, rewards, punishment) into following the one ‘proven’ formula; and
there is something wrong with the recipe, it is not ‘tight’ enough, or it is out of date.
Hence, our obsession in organisational worlds with the likes of processes and procedures, methodologies and methods, scripts, judgment-evaluation of people, criticism, praise, reward and punishment. With this deep rooted obsession we create a wide open clearing for all kind of charlatans to show up and sell their unique ‘secret recipes’ for success – in just any and every domain including the domains of Customer and Leadership.
What Constitutes The Deepest Lack Of Intelligence?
Is there a deeper lack of intelligence (stupidity) than seeking formulas/recipes for the major challenges of business, of education, of living and life? I say yes. What is the deeper stupidity? I say it is keeping our faith in the god like being of formula/recipe intact even when we have followed the formula/recipe and it has not generated the promised-desired outcome/s. Why do we do this? We do this because we grant, individually and collectively, divine status to formulas/recipes. Therefore, it makes sense to conclude that our understanding and/or application of the formula was at fault.
Words Of Wisdom
I invite you to listen to the speaking of one that shows up for me as speaking wisdom:
Once, several years ago, some friends and I enrolled in a cooking class taught by an Armenian matriarch and her aged servant. Since they spoke no English and we no Armenian, communication was not easy. She taught by demonstration; we watched (and diligently tried to quantify her recipes) as she prepared an array of marvellous eggplant and lamb dishes. But our recipes were imperfect; and try as hard as we could, we could not duplicate her dishes.
“What was it,” I wondered, “that gave her cooking that special touch?” The answer eluded me until one day, when I was keeping a particularly keen watch on the kitchen proceeding, I saw our teacher, with great dignity and deliberation, prepare a dish. She handed it to her servant who wordlessly carried it into the kitchen, to the oven and, without breaking a stride, threw in handful after handful of assorted spices and condiments. I am convinced that those surreptitious “throw-ins” made all the difference….
But what are these “throw-ins”, these elusive, “off the record” extras? They exist outside of formal theory, they are not written about, they are not explicitly taught. Therapist are often unaware of them ……. The critical ingredients are hard to describe, even harder to define. Indeed, is it possible to define and teach such qualities as compassion, “presence”, caring, extending oneself, touching the patient at a profound level, or – that most elusive one of all – wisdom?
- Irvin D. Yalom, Existential Pyschotherapy
Concluding Thoughts For Your Consideration
I invite you to consider:
That the guru does not even have to be a charlatan for charlatanry to show up. How so? In this example, the matriarch, was not aware of the “throw-ins” that were being added to her recipe by her assistant.
Where human beings are intrinsic to the game being played, the access to effectiveness (generating the desired outcomes) lies in a sensitivity-attunement to the context in which the game is being played.
Sensitivity-attunement to the context allows you to figure out and put into the game the “throw-ins” that make the difference between the ordinary and the extraordinary.
It is our addiction to slavishly following formulas/recipes that is the biggest obstacle to being attuned and responsive to the context and throwing in the most appropriate “throw-ins” for that particular context in that moment;
Insisting on and slavishly following formulas/recipes (including processes, procedures, scripts, methods etc) is the most significant barrier to effectiveness in the human realm. And that includes the dimensions of Customer (customer service, CRM, customer experience) and of Leadership.
You may disagree. If that is the case then I look forward to hearing what you say.
2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 3)
This conversation continues on from where the earlier one ended. As promised, I have been looking at what Nunwood has to say about certain brands. And find myself in a position to share with you the table that I have put together:
What Does It Take To Be A Customer Experience Excellence Leader?
Just about everyone I come across business is looking for the answer, the recipe, the formula for turning the ordinary into extraordinary, base metal to gold; Nobody has or makes the time to linger, to think and rethink, to grapple with, experiment, and finally arrive at a home made ‘solution’ to any serious challenge. So is there a recipe/formula for CX excellence?
If there is, then it is worth taking a look at First Direct as it is in top place in 2014 and has consistently been in the top 10. Here is what the folks at Nunwood say on the matter (bolding mine):
The First Direct formula is remarkably simple one, yet it has proved difficult to implement in other organisations: remove the barriers between customers and the bank; employ people who want to serve the customer and care about doing a good job; train them intensely and empower them to handle and resolve any issues brought to them by the customer.
What does this look like from a customer perspective? Let’s listen to a First Direct customer:
I was in Venice when my credit card was refused and it was quite stressful. I phoned First Direct and talked with a patient man with a great sense of humour who spent time talking to me about the holiday, acknowledged this this was a stressful thing to happen and worked methodically to sort thing out. I rarely phone First Direct as I can do almost everything online, but is was so important that when I needed them, they were unfailingly polite, human and ready to treat me as valued customer.
What Is It That Is Missing From The CX Game Of Excellence?
I have read the Nunwood report several times. And putting this report together with other reports and my lived experience I find myself thinking “There is no rocket science here!” and find myself in agreement with the author of the Nunwood 2014 UK CX report when they say (referring to First Direct) that the formula for CX excellence is a remarkably simple one. So why is it that so many brands fail to make any meaningful shifts/progress in CX excellence? Allow me to point at what occurs to me as ‘that which is missing the presence of which makes all the difference’ by sharing a personal story with you.
Earlier this week I was due to be at an important meeting in central London at 10:00. Seven people were counting on me to be there to ‘chair’ the meeting. I was counting on myself to be there to chair the meeting. The unexpected occurred on my way to the rail station. I found myself at a stand still on the road for 45 minutes or so. I took the next train – thirty minutes later than I had planned. This meant that my contingency was gone – everything had to work out just right if I was to make that meeting on time. I arrived at Paddington Station and made my way hurriedly toward the underground. Suddenly, I found my feet sliding, no control, left knee smacks into the hard tile floor, right leg twists awkwardly, the right ankle is in some pain. A helpful gentlemen helps me up. I recover and get that the floor has become an ice rink in some place (food for a future post). I walk slowly, in pain, towards the underground. The up escalator is out of action so I make my way up the stairs – slowly and awkwardly, in pain. I walk for several minutes to the underground entrance. It is closed. I ring both of my colleagues and the client to let them know that I am likely to be late.
Making my way to the taxi rank I notice a long queue and get that if I wait there I will not get to the meeting on time. So I make my way down the stairs and out of Paddington Station. Leaving the station, the rain falls down and I start getting wet. I walk away from Paddington station and towards central London. Why? I get that I have to get far enough away from the station to find an empty taxi. As I am walking I am in pain and mindful that I have to walk carefully on my sprained ankle. After walking for 5 – 10 minutes I find a black cab. I tell the cab driver that he is blessing, a Godsend. We arrive at the client’s office – five minutes after the meeting has started. What do I find? The meeting is on the sixth floor and all the lifts are out of service. What do I do? I embrace the pain, walk as mindfully and carefully as I can, and make my way up the stairs to the sixth floor. I chair the meeting, we do what needs to be done. Just after noon I leave and make my way home as I am in considerable pain.
What was it that allowed me to overcome a series of obstacles and considerable pain to honor my commitment? Absolute commitment to the commitments that I make: playing full out to honor my word. Ask yourself how often you find that kind of commitment when it comes to the CX realm. Now you have your answer to why it is that so few are CX Excellence Leaders and most are languishing in ‘no mans land’ of averageness.
Enough for today. In the next post I will bring this series of post on the Nunwood 2014 UK CX report to a close. I wish you a great day and thank you for your listening.