Customer Experience: A Tale Of Two Service Providers – One Public, One Private

The Technology Exists to Transform the Customer Experience

In his latest post Don Peppers shares his experience of attending the Mobile World Congress in Barcelona. Given my recent experiences as a customer, the following words particularly resonate with me (bolding mine):

“At virtually every booth, at every significant exhibit, the message was about how to use each of these new technologies or product offerings to deliver a better customer experience. To interact faster or more efficiently with customers. To provide what customers need in a more effective manner. To deliver better, more reliable service, less expensively and more flexibly.

And this didn’t seem out of place to me at all, because the customer-experience revolution is being powered by technological change. It’s always been a good thing for businesses to be customer-oriented, but it’s only within the last twenty years or so that technology has made it economically possible to be customer-centric, at scale.”

I want to pick up this theme and illustrate it through two of my recent experiences. One with a public sector organisation (The Passport Office, UK) and Churchill (car, home, travel, life insurer).  Which one is making effective use of technology to transform the customer experience?

What Kind of A Customer Experience Does The Passport Office Enable-Deliver?

1. My Experience Fifteen Years Ago

The last time I put in an application to renew my passport was fifteen years ago: 1990.  I remember it being a painful process.  First, I made my way to the local Post Office branch. Then queue up for some 10 minutes, finally only to be told that the branch had run out of passport renewal forms. This meant getting into my car and travelling to the main Post Office branch in the town centre. This required a ten minute journey, the hassle of finding a car park, paying car park charges. Waiting even longer – something like 20 minutes – to get hold of the requisite form. Whilst I was in town, I took the opportunity to get passport photos made.

Once I had the paperwork and photos, I returned home. After I had completed the paperwork, I had to write a long declaration in tiny writing on the back of several photos (of me). Then I phoned my doctor’s surgery requesting my doctor to sign two of these photos to declare that they represented my likeness. I was told that the doctor would charge a fee of £40. So the next day I took the fee and the photos and left them with the receptionist at the doctor’s surgery. I was told that the photos would be available for collection in two days.

A week or so, I remembered the photos so I made my way back to the doctor’s surgery to pick up the photos. As the surgery was busy I had to wait something like five minutes to ask for the photos only to find that they had not been signed!  After another couple of days I got hold of the signed photos. Then I put all the material together, took it to the Post Office and sent it away ‘special delivery’. About four weeks later, I received my new passport.

2. My Experience This Time Around

I had been aware for months that my passport would run out in Feb2015. I also knew I needed a passport to travel – for work, with the family on holidays  . Yet, I could not get myself to start the renewal process – except for getting the passport photos made. Why?  The memory of the previous experience was fresh in my mind. I was totally convinced that it was going to be a long drawn out effort (hassle) to get my new passport.

One day I decided to take on the challenge. This time I did not go to the local Post Office branch. I opened up my laptop and typed “UK passport renewal online” into Google. To my delight, I shortly found myself on the http://www.gov.uk website presented with easy to understand wizard/directions. By following the online process, within four minutes I had filled in the requisite screens, selected various options, paid the fee through credit card, and printed out the requisite paperwork.

I checked over the paperwork. Then I attached two passport photos – this time I was not required to get the photos attested by my doctor. I added in my expired passport, sealed everything up in an envelope, and walked to the local Post Office branch. At the branch, I paid the requisite fee for ‘special delivery’. I experience ease and marvelled at how easy it had been this time around.

Just a week into the process, I got an automated message from The Passport Office telling me something like “Your passport is being printed right now. And will be with you in a couple of days.” I found myself surprised and delighted. Why?  The Passport Office had used technology to make the application process easy and quick. Now The Passport Office was using technology to keep me up to date with progress – just at the right moment, the moment my passport was being printed. Wow!  How clued in, how customer-centric, is The Passport Office.

The Passport Office went on to keep its promise. I received my new passport within the promised two days. It had taken a total of 8 working days to get a new passport office issued. And the most effort had involved going into the town centre and getting the photos taken.  A total contrast with fifteen years ago.

Now that is how to make good use of technology to get the customer from where he finds himself (current situation) to where he wishes to be (desired outcome) easily, quickly, intelligently. And cut out unnecessary costs – for both the customer and The Passport Office.  So I acknowledge and thank the folks that have thought things through and transformed the process of renewing a British passport through the smart use of digital technologies.  Great work! It is the kind of work that I’d be proud to do myself as a digital strategist and CX designer.

What Kind of a Customer Experience Does Churchill Deliver?

Recently, I had to contact Churchill to ask how many years of no claims my wife has. So I phoned Churchill and after a couple of minutes I found myself talking to a helpful call-centre agent. She gave me the answer.  Then I told her that I needed that in writing. She told me to wait whilst she triggered the necessary paperwork, and assured me that the no claims certificate would be with me in five days.

The no claims certificate did not arrive as promised. And my wife started pestering me as her car insurer was pestering her to provide it – else her insurance policy would be cancelled.

So I rang Churchill again. Another helpful call-centre agent took my call. I explained the situation and the importance of getting the no claims certificate asap. I requested that she email it to me. She told me that she was not in a position to do that. She did not have access to email. All she could do was request (in her system) for the certificate to be printed and mailed to me. That is not the answer I was looking for.   The end result was that I had to be patient and wait to receive the certificate in the post.

Has anything substantial changed in regards to customer’s post sales interaction with insurance companies?  I am tempted to say, little – at best.  Fifteen years ago, I called up insurers to get my post sales needs met. I did the same this year. Fifteen years ago I had to wait for five to ten days to get paperwork in the mail. This time, 2015, it is the same.

Why has Churchill not made effective use of digital technologies – to make things easier, to minimise the cycle time, to cut out unnecessary costs, to deliver a customer experience that leaves their customers grateful that they are doing business with Churchill?

The technology exists to create a online self-service portal. The technology exists to allow customers to make requests through this portal. The technology exists to take these requests and convert them to cases for call-centre agents to review-execute. The technology exists to cut-out call-centre agents out of simple processes and get simple requests actioned by the system itself. The technology exists, to create documents and send them out through email. The technology exists to keep customers informed – to track the progress of their requests…. Is Churchill using any of this technology?  No!  Why not?

Summing Up: Why The Customer Experience Sucks Most Of The Time For Most Organisations

I will allow Don Peppers (who, along with Martha Rogers, deserve the label thought leader) to sum up the situation at hand:

The technology part gets faster-better-cheaper every year, but this just throws into stark relief how difficult it really is, as a business, to take the customer’s point of view, and to organize yourself to deliver a superior customer experience, across the firm. The vast majority of companies have a great deal of difficulty with this task, even with all the digital technology now available.”

Why do the vast majority of companies have such great difficulty?  Don sums this up, beautifully:

“At its core, for a firm to improve its customer experience it must minimize the friction in the experience. It has to remove obstacles, eliminate problems, and streamline processes. But the overwhelming majority of companies just aren’t organized to do this. Instead, as a first priority, companies organize themselves to minimize the friction in their production process.” 

Of course this begs the question: Why aren’t the Tops who run these companies reorganising the way their companies work?  It occurs to me that if the caterpillar had the kind of intelligence that we have it is highly likely that s/he would think the idea of ‘butterfly’ was a great one. And when it came to taking action – to going through the transformation process – the caterpillar would choose to stay as a caterpillar. And take the easier route of adding one or more colours to its caterpillar body. Our gift of foresight-imagination is both a blessing and a curse.

I thank you for your listening. For my part, I am delighted to be in a position where I can share my speaking with you.  I look forward to listening to that which you share.

 

What Is The Access to Transformation And Authentic Customer-Centricity?

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?

Summing Up

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.

 

What Is The Access To Innovation Including CX Innovation?

Some time ago I found myself in a workshop listening to and observing that which was occurring. As time flowed onwards and my existence kept ebbing away, i found myself sad, deflated. Here were a group of intelligent people who were charged with charting the future of their organisation. And that future included the label of ‘a customer-centric organisation’. There was much talk about customer obsession, trust, customer experience innovation etc.

So how is that I found myself sad and deflated?  I found myself present to that which did not appear to show up for the rest of the team. What was I present to? The following says it as well as it can be said:

We construct realities and then forget we were the ones that constructed them. When our relationship with reality has a kind of “is-ness”or “fixed-ness” to it, – it limits what’s possible and allows only for options like explaining, trying to fix, resisting or accepting. The answer to the question, what does it mean to be human, gets looked at only through that lens. The movie The Matrix says it well: “Welcome to the desert of the real.”

– Gale LeGassick, Landmark Education

Time and again, I find myself in meetings and workshops where the talk is lofty yet where the course of action is merely reasonable.  What magnitude of possibility lies in a reasonable course of action? Reasonable possibility. What kind of possibility is that?  More of the same and results which are merely reasonable. What is another word for reasonable? Average.

The access to new realms of possibility and the generating of extraordinary results lies in the unreasonable.  Unreasonable given the taken for granted “is-ness” yet not at all unreasonable when one lets go of the cage of “is-ness”. It occurs to me that if there was a master of ‘reality distortion’ it was Steve Jobs. Which may explain why it was that he was the source of new worlds of possibility and extraordinary accomplishment.

It occurs to me that the deeper reason that so few organisations innovate – in any dimension – is that the folks who are doing the innovating are reasonable folks taking reasonable courses of action.  What is more reasonable than going for the ‘low hanging fruit’? Or sticking to the proven methods?  Or involving only the people that have proven themselves to be good team players and safe pair of hands?

Innovation is not simply a matter of process / methodology. Nor is it a matter of tools and techniques. At its heart innovation, and that is just another word for transformation, is a matter of being: the being of the folks in the organisation, and the being of the organisation as a whole.  Only those whose being is ‘unreasonable’ have access to generating innovation and transforming business.

Put simply: plodders do not cause innovation or transformation, they simply plod along no matter what tools and techniques you put in their hands.

The accessing to innovation / transformation? Leaders: those who are ‘unreasonable’ enough in their being to put their very being at stake to bring forth, into the world, the ‘unreasonable’: new worlds of possibility.

 

 

Transformation: Brief Exploration Of Two Radically Distinct Customer Experience Paradigms

What Is The Context For This Conversation?

I am following the lead taken by Dawna MacLean in her recent post on encouraging businesses to become more human. It occurs to me she is a brave lady worthy of admiration and respect. I dedicate this post to her, in service of the stand she is taking and the possibility that she is living from and into.

There are many actions that I regret. Few bring me shame. One in particular is etched within me despite it occurring ‘a lifetime ago’.  I reckon I was 14 at the time, walking, alone, on my way into the town centre. I am stopped by an old lady, she has a walking stick, she tells me she is lost, she asks for directions. I draw closer to hear-understand what she is saying. She smells! I tell her that she need to turn around. I tell her she is only ten minutes walk from her destination. And I spell out the directions – twice.

A voice speaks to me along the following lines: “Take her hand, walk her there, it is even on your way somewhat. Without your help she will struggle.” Another voice speaks: “She smells awful! You are in a hurry and it will take ages to take her there. You have given her what she asked for. She’ll be fine.” I listen to the second voice, leave her to make her own way, and I walk into town.  I cleaned up a lot of history whilst participating in Landmark Education. And that is one that I never got to clean up.  If that old lady were here today, I’d ask for her forgiveness.

Why am I sharing this with you?  So that you have the context from which to make sense of what I speak-write.  I write is not to help you make it: sell more, be more successful, obtain higher status, live happily ever after.  I write to open eyes, unblock ears, touch hearts. I write to encourage-facilitate a shift of worldview. I write from the possibility of meaningful-fulfilling human lives and the possibility of a ‘world that works for all, none excluded’.  Arguably a world that works must include meaningful-fulfilling human lives.  And such a world has plenty of space for businesses that do great by doing good: enriching human lives, and life as a whole.

What Is The Experience That Goes With Transformation?

The last post ended with “So the challenge of Customer Experience is the challenge of a transformation in worldview.”  When I speak transformation, what am I pointing at?  Look at the following picture, keeping look at it until a shift occurs in what you see.

Gestalt Shift Cuble

 

What occurred? If you are like me then you probably started out seeing a small cube sitting inside of a an ‘open box’ and then came a moment when you saw a big cube from which a small cube (left hand corner) was cut-out, missing.

Please notice, the reality (that which is) has not changed. It is the same picture – nothing about the picture itself changed. Yet, that which you perceived-saw changed and you had something like a surprise: an ‘aha’ experience.  Why?  Because the perceptual switch that occurred was not simple a change-adjustment-variation of what you saw originally. What you saw was distinct from what you had seen earlier. Put differently, a transformation occurred in your seeing.

What can we learn from this?  Given the same ‘that which is so’ you made sense of it in two distinct ways.  And, this is important, each way of seeing ‘that which is’ occurred as natural, correct and absolute whilst is was occurring the way it was occurring for you. Only by looking at the picture for a sufficient period of time, in a specific manner, did the gestalt like shift in your seeing occur. And when it did occur, it occurred in an instant.  Transformation is like that.

Now think of business and organisational life and apply that which you have experienced here. And learned. Ask yourself this question: is the way that the business world is ‘pictured and talked about’ the only way of picturing and talking about it?  Is it possible that there are many ways of picturing, talking about, and showing up in the business world?  I say that there are numerous ways of seeing-interpreting the business world – that the number of ways is only limited by our imagination AND the influence-strength of the dominant paradigm of seeing.

Customer Experience: Two Radically Distinct Paradigms

Let’s take a brief look at each in turn.

CX Model 1: The Dominant Way of Seeing-Using Customer Experience

It occurs to me that a lot has been written about Customer Experience. For me most of it shows up as shallow, or simply putting ‘lipstick on the pig’.  What am I pointing at when I speak that which I have spoken. Take a look at the following picture:

Dominant Model of CX
Dominant Model of CX

In this way of seeing, Customer Experience is viewed-treated simply as a means of:

  • Increasing revenues
  • Reducing or containing costs e.g. through using lower cost channels to ‘serve’ customers; and
  • Risk management given that every customer has access to a smartphone and social media and thus is in a position to damage brand-corporate reputation.

The goal of business within this dominant paradigm is that which it has been since the ascendency of shareholder value and ‘greed is good’ ethos. This goal is characterised by a focus on self (oneself and one’s tribe), and greed: to extract as much value as possible in the short-term. Any value created for the customer is the minimum that it is necessary to create in order to extract as much value for ‘Self”.

Within the dominant paradigm, CRM (including social CRM) is simply a technology that is used to augment-strengthen the existing business logic: getting as much money out of the customer as possible whilst giving away the minimum; and getting as much value (productivity) out of employees whilst giving back the minimum.

Finally, in this model (as practiced) the deep business logic stays the same. Competition rather than collaboration. Self at the expense of others. Efficiency rather than effectiveness…… Importantly, people are neither trusted nor treated with respect and accorded the dignity that goes with being a full human being; threat, fear, and game playing are pervasive.

CX Model 2: A World Waiting To Be Invented, And Mastered By Few

I call the second model ‘A World Waiting To Be Invented’ because it is only practiced-mastered by a few. The rare few that come to my mind include: John Lewis/Waitrose, USAA, and Amazon/Zappos.  What constitutes this second model? Here is a picture:

 

A World Waiting To Be Invented
A World Waiting To Be Invented

In this model Customer Experience is a subset of Experience. Experience encompasses the experiences of all the participants-actors-stakeholders: customers, ‘partner’s (the people who actually work in the organisation and create value for customers), value chain partners (suppliers, channel partners, outsourced partners…), and the community.

The ‘Goal’ of the business within this paradigm (way of seeing the world of business) is one of creating value for and sharing this value with the whole system (all the participants, all the stakeholders). Such a business is focussed on making a contribution and serving: enriching the lives of all participants. And usually takes a stand and operates from-into a specific possibility. Take a good look at the John Lewis constitution and you will see the stand and the possibility spelled out. Read Jeff Bezos’ annual letters or Tony Hsieh’s book, Delivering Happiness, and the possibility-stand is clearly articulated.

In the model, the business logic of the organisation is designed-operated from the context of creating-generating the kind of ‘Experience’ that is mandated the ‘Goal’.  Put differently, the ‘Business Logic’ now serves as the means of delivering the Experience.  Not the other way around.  Put differently, ‘Experience’ precedes’ Business Logic’.

From where does the design of ‘Experience’ flow?  From the ‘Goal’. Remember the goal is to cater for the needs-welfare of the whole. Which is why ‘Experience’ encompasses all the actors, all the stakeholders.

In this way of looking at the world of business, and according to me, Customer Experience takes it’s rightful place. Rather than dominating the discussion, Customer Experience is seen for what it is, just one component whose meaning-impact comes from how it fits into the other components of Experience. And how it gives life to the ‘Goal’.

What becomes of CRM in this model?  CRM systems are simply tools to give life to the ‘Experience’ that the organisation is committed to creating-generating.  As such CRM systems must take into account the needs of Customers and ‘Partners’ (people who will use the systems) and deliver the kind of experience(s) that these folks are looking for.

Enough for today. I may elaborate on these models in the future. If you find yourself moved to share your thoughts then I invite you to do so.

 

Who and What is the Biggest Obstacle to Making the Transition to Becoming a “Customer Company”?

Are the Tops are the biggest obstacle to your organisation becoming a “Customer Company”?

Some of you have questioned my emphasis on the Tops and their critical importance to any successful shift towards your organisation becoming a “Customer Company”.  Some of you have asked me why it is that I have focussed on the Tops and not the Middles and the Bottoms.  The answer is twofold.

First, there is the fact that every system has certain points that have much higher leverage than others. Isn’t that  what we are looking for when we map the customer journey, assess the customer experience, and look for the “moments of truth” – the interactions that really matter and leave customers happy or unhappy, promoters or detractors?  Ask yourself who you would approach and seek to convince/persuade if you wanted to trigger major organisational change.  Would you approach the sales rep or the call-centre agent or would you approach one or more people in the C-suite?

Second, there is my 20+ years of experience at the coal-face of organisational change and business performance improvement in its many disguises.  Yes, the Middles and Bottoms have some capacity to resist/impede change initiated by the Tops. What is missed is that they rarely have the capacity to initiate major organisational change nor to bring it to an end abruptly.  This capacity, this power, lies with the Tops.

Never underestimate the Tops addiction to control and the fear of losing it!

Allow me to share a real life example with you.  This example is provided by Judith E. Glaser in her book Creating We. In this book she shares the story of  a weight loss company and its shift toward customer-centricity.  Here is an abridged version of her story:

Major change – or transformation – usually involves a huge shift in power that takes place across a company. In the 1990s, a weight-loss company was experiencing customer defection at a high rate….

Customers were defecting from their programs and, worse than that, they were telling other potential customers that the company was awful…… The company was getting a bad reputation for high cost/low value…..

The company leaders didn’t believe how serious the situation was. They felt that Weight Watchers and Jenny Craig were no match for their billion dollar powerhouse. But they were wrong and the feedback proved it.

……. we did extensive customer research, as well as franchise research among their 4,500 sales consultants, and discovered that the hard-sell style did indeed cause customers to rebel at some point and to spread the word that the company was insensitive, pushy and only out for money.

….. we engaged hundreds of internal consultants and totally revamped the sales approach, and, most of all, its relationship to its customer.  The company changed its value proposition ……. we created a sales-training process to teach everyone how to be sensitive to customers, to talk and partner with them……. the program was called “Partnership Selling”….

Customers loved the new approach, and sales consultants did, too. Interestingly, however, the new approach created great problems for the leadership team. 

The previous hard-sell approach…… enabled the company to track each sales consultant’s every move. Each was trained to memorize a sales script and not divert from it….. This highly structured, predictable, customer insensitive approach enabled them as a company to track what everyone did and said down to the last word, giving the company control of every customer interaction. They rewarded sales consultants for getting the pitch perfect…….

The new customer-focused process reduced the control of the corporate headquarters and increased control for the sales consultants to manage the “customer experience”.  Corporate went along with the new approach for a short while, maybe six months, then retracted the whole value proposition, for fear they were losing control.  Corporate were unable to ensure that everyone followed the same process. They therefore were unable to reward the best sales consultants for following the script…… Their focus was totally internal and control-based. 

…. during this time, the former president returned to run the company. He favoured the canned controlled interaction with customers and reinstated the old approach to selling. The hard sell returned and the customers left……

During the process, they were hell-bent on reinforcing their own way of doing business, dominating the customer and the sales organisation, and being in total control. After they went out of business, a few of the executives realised they had authored their own demise.

They executives were at the edge of new insights. They were taking the coaching and doing well. Then their insecurities kicked in, the fear of losing control returned, and they went back to square one.  They could not leave their Comfort Zone of doing things the way they’d always been done.  The only WE they could see was the familiar WE of their fellow senior executives, not the inclusive WE of the enterprise as a whole, and certainly not the WE of the customers.

When organisations are faced with change, fear often causes them freeze and hold on to the current way of doing things, even if its not working…..

Unhealthy cells stop taking nourishment from outside, stop taking feedback, and defend their position; and the president responded the same way. He stopped listening to the marketplace, to the customer, and defended his point of view; he was not open to feedback or to new ways of thinking. People had to please the boss, and they did.

 

Customer Experience as an access to & source of business disruption and transformation

What do the failures of three high street chains disclose about Customer Experience?

Over the last week or so, three brand name high street retailers – Blockbuster, HMV, and Jessops – have failed.  What do these retailers disclose about the Customer Experience?

I say that these retailers disclose that Customer Experience is both an access to business transformation. And at the same time, a source of business disruption.  Yes, digital technologies often enable a superior Customer Experience. Yes, someone has to figure out a viable business model. And yet, it is the superior Customer Experience that attracts customers and thus enables business disruption and transformation.

I also say that the demise of these retailers shows something else.  What? It shows that most of the companies that are talking about / using Customer Experience are using it as a tactical tool. And that is a mistake.  How can I point this out clearly? Let’s take the airline industry.  I say that as and when a company invents a ‘teleporter’ (think Star Trek, Blakes 7) it is the end of the airline industry no matter how much money the airlines spend on improving the Customer Experience associated with flying. And even with a ‘teleporter’ the people who go on sea cruises will continue to go on sea cruises.  I hope you get that which I am pointing at.  Just in case, I have failed to communicate, I am going to take a look at the demise of Blockbuster.

What lesson does Blockbuster disclose?

Why did I turn to Blockbuster?  To do a job.  What job?  The job of entertaining myself and/or my family.  What role did Blockbuster play?  Blockbuster provided the means for me to get that job done?  What was ‘the means’?  The video.

What did I have to go through to get the job of entertaining myself and my family done? I had to drive 12 minutes to the nearest Blockbuster store only to find that the car park was full. Then I had to drive around and find somewhere to park – not easy. Once I parked the car, I had to walk to the store. Then hope the right video was in store.  Select a video, queue and pay. Then walk back to the car and drive home. Watch the video. Tell myself to remember to take the video back. Next day, drive to the store, find somewhere to park, walk to the store, return the video.

Do you notice something?  The Blockbuster Customer Experience imposed costs – time, effort, worry – on me.  I did not want to drive.  I did not want to find somewhere to park. I did not want to turn up at the store and find Blockbuster had no more copies of the movie I wanted to watch.  I did not want to have the threat of late fees hanging over my head. I did not want to go back to the store to return the video.  These were the costs imposed on me by the Blockbuster Customer Experience.  I put up with them because I did not have a better alternative.

When the better alternative came – a better Customer Experience – I left Blockbuster. With Netflix and/or Lovefilm I select the movie I want to watch and I can watch it instantly on TV, on the PC, on the iPad, on the iPod. And if I don’t like that movie? I stop it and instantly start watching another one. All for a flat monthly fee which is better value than Blockbuster ever was.  Actually, it is better than that because I don’t watch many movies, my family does. Now, they do it themselves and I have no work to do!

What are the fundamental insights/lessons here?

It occurs to me that there are two lessons.  First, digital is disruptive. Digital technologies, used imaginatively, used courageously, hold the potential and promise of business disruption. Why? Because they enable companies to craft and offer superior customer experiences.  How?  They collapse time-distance-effort-worry. And thus enable smart companies to come up with value propositions and customer experiences that customers value. Which probably explains why the bulk of my work over the last two years has been concerned with digital strategy and digital customer experience.

Second, the real leverage in Customer Experience is not tinkering with what it is – which is what most companies are doing.  The real leverage is using insight and imagination to design fundamentally new and disruptive customer experiences.  The ones that enrich the lives of customers (by delivering unexpected benefits) and at the same time take out costs – time, effort, delay, worry  – and deliver greater value for money.

And finally

It occurs to me that if you want to get strategic value out of Customer Experience then go back and read/study The Experience Economy.  The point is not merely to improve the experience associated with a product, service or solution.  It is more than that.  What it says is that you can choose to compete at a completely different level – the experience level.  What are you selling?  An experience.  What kind of experience? The kind of experience that Build-A-Bear has come up with for bears for children.  The kind of music experience that Apple has created through iPods, iTunes, iCloud.  Or the membership experience that the MVNO giffgaff has put together for mobile telecommunications.  The kind of experience that Netflix and Lovefilm deliver for movies.

Please remember that if your business is open to digital disruption then it will be disrupted.  You can choose to do that yourself. Or you can wait for someone else to do it.  Blockbuster and HMV could see the disruption, they chose not to act.  As for the folks at Jessops, hindsight says that they should have got out of the camera business and into the business of selling smartphones.  What do you say?

Extreme Trust: can honesty be a means of competitive advantage? (part 1)

I enjoy reading what Don Peppers and Martha Rogers write.  In fact their point of view spoke to me in such a way that it called me to join up and become a part of  The Peppers & Rogers Group, for a while, back in 2000.  Don and Martha have published a new book Extreme Trust.  In this series of posts on trust I am going to share with you, comment upon and explore topics that are addressed by Don and Martha in their book.

Does trust matter?

Why don’t you take the salesman at his word and buy what he is selling you?  Because you have learnt that what is in the interests of the salesman, to make a sale and take our money, is not necessarily in your interest.  Why don’t you accept the advertising put out by companies?  Because you have learnt that advertising, as a whole, is not truthful – you know that it has been designed carefully, purposefully, to push your buttons so that you buy.  Put differently you simply don’t trust the advertising.

Trust matters.  Why?  Because our lives are tied up with each other.  Heidegger pointed out that the fundamental being of human being is being-in-the-world – we are not spectators in the stands, we are right there in the midst the world.  Who is there right with us and an essential component of the world?  Our fellow human beings!  Our experience of living and how our lives turn out depends on how we conceive of one another (selfish, co-operative, selfless) and how we treat each other (help one another, look out for one another, indifferent towards one another, exploit one another).  Whether we trust one another or not matters, what we trust another with or not matters, who we trust and who we do not trust matters.

How will you compete against the likes of USAA?

Don and Martha start Extreme Trust by sharing a great story and asking a powerful question that gets to the heart of the matter. Let’s start with the story. It is about USAA a financial service company that consistently comes out as the most trusted financial services organisation in the USA.  The culture at USAA if based on a single yet profoundly powerful statement: treat the customer the way that you’d want to be treated if you were the customer.

After the first Gulf War (1991) USAA  sent out refund checks to several thousand “members” (customers).  Why?  USAA figured out that men and women (armed forces) serving overseas weren’t driving their cars in the USA, suspended the premiums for those months, and sent out unsolicited refund cheques when these men and women got back to the USA.  USAA did not have to do this and no-one asked them to do it.  How did this turn out?  Nearly 2,500 of these refund cheques were sent back to USAA by grateful customers who told USAA to keep the money and simply be there “when we need you.”

Now, here is the question that Don and Martha pose: “How will you compete against a financial services institution that customers love so much they sometimes refuse to accept refunds and are loyal into the third generation and counting?”

What makes USAA (and other companies like USSA) so different from competitors?

I have repeatedly asserted that most of what passes for customer-centricity is simply a sham.  Specifically, the philosophical base, the moral grounding, the fellow feeling, that is necessary for customer-centricity to show up as customer-centric, in the eyes of the customer as a moral being is absent.  This is what Don and Martha say on the matter:

“Most businesses and other organisations operating today think that they’re already customer-centric and they are basically trustworthy, even though their customers would disagree……. Being “trustworthy” is certainly better than being untrustworthy, but soon even “trustworthiness” won’t be sufficient. Instead companies will have to be trustable.

..trustability is a higher standard still.  Rather than working to maintain honest prices and reasonable service, in the near future companies will have to go out of their way to protect each customer’s interest proactively, taking extra steps when necessary to ensure that a customer doesn’t make a mistake, or overlook some benefit or service, or fail to do nor not do something that would have been better for the customer”

In short, USAA and companies like USAA (Amazon, Zappos, Apple, Google…) are trustable and as such they practice are built on the three pillars of trustability.

The three pillars of trustability

According to Don and Martha (in Extreme Trust) the three pillars (they use the term ‘principles’) of trustability are:

Do the right thing.  Essentially this is about the distinction between ‘good profits’ v ‘bad profits’.  Doing the right thing involves giving up practices (like exploiting customers) that generate ‘bad profits’.  And it involves coming up with a business model that generates ‘good profits’ by creating genuine value for customers by aligning with the needs and interests of customers and getting a fair return in exchange. Doing the right thing lies in the realm of leadership and strategy.

Do things right.  This is all about operations and operational excellence.  It is about the domain of management and concerns itself with functions, processes and details so that you make it easy for your customers to do business with you across the entire customer journey and generate the right kind of customer experience at each touchpoint that matters.

Proactively.  In Don and Martha’s words “Knowing that a customer’s interests is not being well served and doing nothing about it is untrustable.  Not knowing is incompetent…. A company might be scrupulous in its ethics, completely honest in its brand messaging, and highly involved in tracking its customer satisfaction, but will it be proactively watching out for its customers interests?  If it wants to succeed in the age of transparency, yes.

What gets in the way of being a “trustable” enterprise?

Why aren’t more companies, even most companies, like USAA, Apple, Amazon, Zappos and the like?   This is a domain I have tackled several times and I say it is addiction to ‘bad profits’.  What do Don and Martha say?

“The fact is that far too many businesses still generate substantial profits by fooling customers, or by taking advantage of customer mistakes or lack of knowledge, or simply by not telling customers what they need to know to make an informed decision.”

Why become a “trustable” enterprise?

Don and Martha are clear that companies don’t have a choice – the tide has turned, customers have the power, and by wielding this power customers will force companies to become “trustable” or die.  This is how they put it:

“.. lots of traditional, widely accepted, and perfectly legal business practices just can’t be trusted by customers and will soon become extinct, driven to dust by rising levels of transparency, increasing consumer demand for fair treatment, and competitive pressure…… Things that companies, governments, and other organisations never meant for people to know they will know.”

“Transparency will increase because of technological progress, and progress is inevitable.  It cannot be avoided or slowed down.….. As important as our social nature is.. social media and other interactive technologies have injected it with steroids.”

What is my take on this?

My thinking and philosophical orientation is in line with that being shared by Don and Martha in their new book Extreme Trust.  As such it is no surprise to me that I am enjoying reading it.  Nonetheless, there are areas in which I find that I am not in agreement with Don and Martha.  They make the distinction between “trustworthy” and “trustable” and in my world that occurs as contrived.

In my world you are either pregnant or you are not pregnant you cannot be half pregnant.  In my world, either I can trust you because I know that your care for me and are looking after my interest or I know that I cannot trust you.  In my world most companies do not merit my trust – I, the customer, simply show up as a wallet to be emptied.  And then there are companies that I do trust because they have done the right thing.  How does the right thing show up as the right thing in my world?  When the company takes a course of action that leaves me better off and it costs the company money. When I hear about what the company is doing to contribute to a ‘good world’.  When I hear about the postive experiences of other customers.

I am 100% in agreement with the power of transparency.  The potential for the kind of disruptive change that Don and Martha are speaking about lies in us wielding technologies that unconceal that which has been concealed from us.  Great example in the UK are the MPs scandal.  Once UK politicians used to lecture the world on honesty, moral uprightness and look down on less developed countries on the account of their corruption.  For many years the UK politicans got away with being corrupt and then the bubble burst.  UK politicians are not in a place to lecture anyone.  Another example is Rupert Murdoch and the News of the World phone hacking scandal.  For many years Rupert, some would claim, was the Kingmaker and pretty much got what he wanted.   He even got the Conservatives to hand him BSkyB on a plate.  Then came the disclosure that a dead girls phone was hacked and the moral revulsion of the ordinary folks forced a public enquiry on a reluctant prime minister, the closure of a newspaper and the abandonment of the BSkyB takeover.

In the next post in this series I will share more of what I learn as I progress reading through Extreme Trust.  I will conclude the series of posts with a review of the book as a whole so that you can decide if you want to read it for yourself.