How to grow a culture that treats customers respectfully

We are embedded – thrown into and always living – in language.  The way that we see ourselves, others, the world at large is shaped by language:  the language that is spoken by leaders, managers, colleagues, friends, family and the media.

Language and culture are two faces of the same coin.  If we want our organisations to become customer focussed or even customer centred then the best place to start is not strategy, not CRM technology, not process redesign nor new metrics.  The place to start is the language that we use.

In the world of business, government, education and healthcare I have come across the following language used to describe the Customer: the market, target, conquest, opportunity, contact, detractor, promoter, advocate, punter, seat, patient …..  When it comes to the  people who work in the organisation, they are referred to as employees, resources, headcount, FTE and so forth.

This language dehumanises, it is the language of the engineer.  By being embedded in this language we strip our fellow human beings (customers, employees, suppliers..) of their humanity: the language makes it possible, even encourages us to treat them as objects – parts of the machinery.

What is our relationship to objects?  Objects are here to serve us and our needs – this is the relationship is it not?.  What do we do with objects?  Are we not always chasing after new objects.  Do we not neglect and often mistreat the objects that are no longer new?

It is this kind of language that calls into being attitudes and actions that:

  • leaves customers feeling misled, neglected, taken advantage of, mistreated; and
  • leads to demotivated employees who when they turn up in the morning for work are looking forward to only one thing – getting to the end of the day so that they can head home.

Imagine for a moment an organisation that speaks of Customers as family.  Our customers are our brothers and sisters.  Or perhaps our parents and grandparents.  Or our children. What attitudes and behaviour does this call into being.  What kinds of attitudes, behaviours and decisions does it rule out?  I helped design and provided the seed funding for a car servicing business that uses the language of family: which sees the customer as brother, sister, mother or father.  This is how this language impacts the business:

  • Car sales:  no car is sold to a customer that would not be sold to the owners mother, father, brother or sister;
  • Car repairs:  the level of care taken in repairing a customer’s care is the same as that which would be taken for the owner’s mother, father, brother or sister;
  • Car valeting:  the valeting is done to the same standard as that which would be done for the owner’s mother, father, brother or sister;
  • Employees: The people who work in the business are treated as family for example the owner goes and buys lunch for all of them and they eat together; and
  • Sales: the business has been in operation for just over 4 years and now 100% of the sales come from existing customers, referrals from existing customers or by word of mouth (reputation).

If the language of family is a bridge too far then how about using the language of tribe – the language of a club, a professional society, a community of interest.  For example I have noticed that solicitors treat other solicitors with courtesy that is born out of profound respect.

My RAC experience: another flaw at the heart of customer theory

Customer relationship theory rests on a set of assumptions declared as truths.  One of these assumptions is that a business will be able to make more profits from established loyal customers as it will be able to charge these customers higher prices and these customers will be willing to pay. Lets take a look at how well this assumption holds up in the real world.

One only has to look at the B2B world to find instance after instance where powerful customers are able to extract favourable terms from their suppliers whether these suppliers are renowned marketing agencies, management consultancies or software/IT companies. If I know I am a valuable customer and I know that you know that I am a valuable customer then I expect you – my supplier – to compensate me for it either through keen pricing, a better (customised) fit between what you offer and my needs, and/or higher service levels.

When it comes to the B2C world my RAC experience is instructive.  For about 10 years I had been a member of the RAC – car breakdown cover.  As the years racked up I noticed that my annual renewal kept going up and up.  At first I did not pay that much attention as the increases were relatively small.  Then two years in a row I spotted increases of the order of 20%+.  This prompted me to think that I was being milked with the automatic renewals so I did a lot bit of shopping on the Internet.

Within five minutes I figured out that I could take out exactly the same breakdown cover with the RAC through the Internet at 2/3 of the price that the RAC was going to charge me through the automatic renewal; I selected the RAC as the comparison shopping showed that the RAC came out top when the factor of price and customer review ratings were looked at together.

Did I follow the theory and say “Look I have been with the RAC for ten years and over that time I have had a several breakdowns and the RAC has looked after me so it is worth paying 1/3 more than I need to pay so lets pay it?” No.  I cancelled the automated renewal by phoning the RAC call centre.  And simultaneously I took out cover with RAC via the Internet. The whole effort took me 5 minutes – in the comfort of my own home.

The principle of reciprocity is simple.  You scratch my back, I’ll scratch yours.  I had been operating on that principle with the RAC and then it became clear to me that the RAC had not.  The result:  I do not trust the RAC and I do not suspect that I will ever trust the RAC.  Furthermore, I now have a decision rule: always, always do comparison shopping before renewing contracts with an existing supplier.

In the real world, human beings – across many societies – are brought up with the law of reciprocity.  Long term loyal customers expect the business to reciprocate by providing better value through a combination of price, the products fit to needs and service: they expect to be treated better than new customers.  This is the opposite of what is supposed and asserted as truth in customer theory.

To conclude: if you are selling customised solutions that take time and effort – from you and your customer – to customise and get right then you can charge a higher price.  However, if you are selling a commodity (like the RAC) then the best way to drive away loyal customers is to milk them by charging them higher prices.

 

Every Customer Experience / CRM change agent should read this book

Any and every person involved in organisational life can benefit from reading this book.  It is a must read for anyone who is a change agent.  Everyone working on getting a better alignment between the customer and the organisation will benefit from reading and applying the insights of the book.

The book is written by Barry Oshry and it is called “Seeing Systems: unlocking the mysteries of organizatonal life“.

If all the people working on / impacted by Customer initiatives – Strategy, Insight, Experience, Engagement, CRM – read and applied the insights then I am confident that their organisation can save a lot to money, time, effort and heartache.

Incidentally Barry also has a blog: The Seeing Systems Blog

The critical flaw at the heart of modern customer relationship thinking

When I was working as a Senior Consultant with The Peppers & Rogers Group the customer paradigm was explained through the analogy of a small grocer (or florist) serving his/her local community.  The thrust of it was that the grocer got to know the customer- the person, his circumstances, his shopping history, his attitude, his values, his beliefs, his preferences – and used this knowledge to offer him the right products, at the right time, at the right price in the right way.  The end point – this is important – we have the technology to recreate that kind of business relationship with our customers.

What the analogy leaves out is the social context.  In days gone by the local grocer (or any other shopkeeper for that matter) was living in the same community as his customers.  He was likely to come across his customers in the social life of the local community.  Some of the customers used to be fellow students at school, others went to the same church, others frequented the same pub, others were friends of friends and so forth.

In short the grocer’s relationship with his customers was much a social one as an economic one; he experienced his customers as rounded multi-dimensional human beings not as one-dimensional economic objects nor as abstractions on a revenue statement. Because of the shared local context the customers also invested in the grocer – they knew the grocer in a rounded context and not just as an economic entity, a grocer.

Furthermore, the owner was also the CEO and the person having the daily contact with customers – listening, talking, interacting, serving customers.

That situation today for Mr Multi-National Enterprise (Mr MNE) is completely the opposite.  There is no social relationship between Mr MNE and the customer – they typically live and move in very different social circles.  The customers do not have to support Mr MNE (like they did with the grocer – else no local grocer) and Mr MNE can find other than local customers – the world is full of potential customers.  And importantly, Mr MNE is completely divorced from the customers – he never has to see, talk with or serve a customer.

So whilst the technology exists to gather information, the all-powerful social context that is necessary for building enduring mutual win-win relationships is absent.  And that is the critical failing at the heart of modern customer relationship thinking.  It misses the fact that relationship are a natural by-product of a social context.  That social context  is missing from the modern corporate world and it cannot be recreated in the typical tenure of the CEO.