On Customer Obsession

Customer Obsession Is Fashionable

I hear more and more Middles & Tops mention the importance/need for customer obsession. It’s often used as an exhortation to the Bottoms – those on the front line.  Something interesting happens when I ask the speaker what s/he means by, is pointing at, when s/he speaks of customer obsession. Silence followed by stuff that shows up for me as either banal or made up on the spot.  Little in the way of thinking (as in contemplation) has occurred in many instances.

Is Customer Obsession New?

Interestingly, customer obsession isn’t new. What’s the basis of my assertion?  I remember 2000/2001: my colleagues and I start a customer strategy engagement (centred on 1to1 marketing) at a well known mobile telco. What do we find? We find a dedicated research unit in the marketing function.  A unit which has budget of many millions. What is this money spent on?  Understanding the market (totality of customers for mobile phones/services); understanding their own customer base; and understanding the customers of their competitors.  I categorically state that the head of this research unit and the folks that worked in that unit were obsessed with customers.

The interesting question is this one: Towards which end/s was this customer obsession directed?  Was it directed towards driving product development?  Or the customer’s experience of signing up for the right phone/package?  Perhaps, helping the customer’s make good of that which s/he had purchased?  No, not at all. The purpose was to work out how to drive up sales and profit margins through marketing: targeting the right messages/offers to the right customers or potential customers.

Was 2000/2001 the start of customer obsession? No.  I remember the power and practices of the various brand marketers whilst in the employ of International Distillers & Vintners back in 1993.  I say customer obsession of this kind -figuring out how to squeeze more out of the customer has a long history.

Let’s consider alternative conceptions of customer obsession.

Satya Nadella on Customer Obsession

In his book Hit Refresh Microsoft’s CEO says (bolding/coloring is my doing):

“First, we need to obsess about our customers. At the core of our business must be the curiosity and desire to meet a customer’s unarticulated and unmet needs ….. There is no way to do that unless we absorb with deeper insight and empathy what they need.….. When we talk to customers, we need to listen. It’s not an idle exercise….. We learn about our customers and their businesses with a beginner’s mind and then bring them solutions that meet their needs. We need to be insatiable in our desire to learn from the outside and bring that learning into Microsoft, whilst still innovating to surprise and delight our users.” 

Jeff Bezos on Customer Obsession

Here’s what Amazon’s founder & CEO says in his 2016 Letter to Shareholders (bolding/coloring is my doing):

“There are many ways to center a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But in my view, obsessive customer focus is by far the most protective of Day 1 vitality.

Why? There are many advantages to a customer-centric approach, but here’s the big one: customers are always beautifully, wonderfully dissatisfied, even when they report being happy and business is great. Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf. No customer ever asked Amazon to create the Prime membership program, but it sure turns out they wanted it, and I could give you many such examples.”

Shortcuts on The Route of Customer Obsession

It occurs to me that many executives are all for customer obsession as long as they can just speak it sitting comfortably in the stands.  It’s another matter altogether when customer obsession requires leaving the stands and entering the arena.  Which arena? The arena in which customers show up and operate.  And the arena in which the customers interact with the organisation’s front line – websites, mobile apps, sales folks, customer services….

Take a look at the CX movement and ask yourself what is it characterized by?  Is it not journey mapping almost always in the comfort of a workshop in the corporate offices, and the results of voice of the customer surveys?  What are these?  They are proxies for the real thing.  These proxies are attractive as they allow folks to pretend they have insights from the arena whilst sitting comfortably in the stands.

Here’s what Jeff Bezos says with regards to proxies in his 2016 letter (bolding/coloring is my doing):

Resist Proxies

As companies get larger and more complex, there’s a tendency to manage to proxies. This comes in many shapes and sizes, and it’s dangerous…

A common example is process as proxy. Good process serves you so you can serve customers. But if you’re not watchful, the process can become the thing… The process becomes the proxy for the result you want. You stop looking at outcomes and just make sure you’re doing the process right…..

Another example: market research and customer surveys can become proxies for customers – something that’s especially dangerous when you’re inventing and designing products.

Good inventors and designers deeply understand their customer. They spend tremendous energy developing that intuition. They study and understand many anecdotes rather than only the averages you’ll find on surveys. They live with the design.
I’m not against beta testing or surveys. But you, the product or service owner, must understand the customer, have a vision, and love the offering. Then, beta testing and research can help you find your blind spots. A remarkable customer experience starts with heart, intuition, curiosity, play, guts, taste. You won’t find any of it in a survey.”

Enough for today.  I thank for your listening. Until the next time….

Maz Signature

 

 

 

On Self, The Customer & Leadership Blog, and Cultivating Loyalty With Employees, Partners, and Customers

Cancer, the impending arrival of death for my friend and later myself, concentrates one (at least me) on that which matters.  Today’s conversation is around that which has been unconcealed for me: about myself and the purpose/contribution of this blog.  So now is the time to leave if this is not the conversation for you.  I don’t even know, right now, how long this conversation is going to be.

Purpose of The Customer & Leadership Blog

Why did I create this blog back in 2010?  Was it to be recognised as a thought leader, a guru, in the Customer space?  Was it to get on the speaking circuit and make money? Maybe it was to sell my services e.g. paid for content and/or advertising as a result of having a thriving web presence?  Some folks think so. Enough people contact me to speak as a thought leader. More contact me about writing advertorials and passing them off as my conversations. Others contact me to search maximise this blog (as it is crap from a search perspective enough though it has great content – that is what I have been told). Then there are others that offer to write stuff, for free, that I can publish on this blog.

I decline all the content stuff. Occasionally, if the speaking stuff appeals to me I speak.  The rule is that I speak that which I speak – for that is the only way that the speaking shows up and expresses itself through me.  Once boundaries are putting up, the speaking dries up.  That is simply so and I work with that – life as it is and is not.

So what got me started?  Allow me to share the following quote:

“I had a vivid imagination. Not only could I put myself in the other person’s place, but I could not avoid doing so. My sympathies always went to the weak, the suffering, and the poor. Realising their sorrows I tried to relieve them in order that I myself might be relieved.” – Clarence Darrow

In short, I found myself identifying with particular folks in organisations: those with affinity for the customer, seeking to simplify/enrich the lives of their customers AND get a fair reward (money) for the difference they make in the lives of customers.  It occurred to me that these folks were being misled or duped by those with influence: academics, consultancies, thought leaders, and gurus.  I found most of their advice BS in the sense that Harry Frankfurt uses this term.

It occurred to me that these high priests (thought leaders, gurus, academics, consultancies) were sitting in the stands and at best sharing that which they saw from the stands. Few had/have substantive (many different trials over many years) experience in the arena. Yet, the game is played in the arena – always! The insight / truth that matters is the truth that arises from and makes a difference in the arena!  Not the commentary that comes from those sitting comfortably in the stands – spectators.

I have been in that arena playing many roles in many types of Customer games: salesforce automation, CRM, 1to1 marketing, CX, web design & commerce, digital strategy, marketing automation, sales & account management, customer service & contact-centres…

It occurred to me that I could/should make a contribution by sharing that which I had learned through many years in the arena; there is both success and failure in the arena, each provides learning opportunities, oftentimes the learning from failures is more powerful than the learning from successes.  This logically led me to this choice: the choice to share my perspective/learning/experience for those who find themselves in the arena or are about to enter the arena. Hence, the genesis of The Customer & Leadership Blog for the business domain.

The joy of self-expression and contribution through this blog, The Customer & Leadership Blog got me thinking. Why not make a similar contribution to folks on the personal (non business) side of human existence. This led to the birth of a second blog: Play BIG: Live A Life Worth Living.

Still why did I do this and why do I continue to do this. Is it to be a thought leader or to establish myself as a guru thus win lucrative speaking gigs?  Talk to my wife. Talk to my great friend  Lonnie Mayne: you might find that I prefer to be in the background as a catalyst: coaching, educating, enabling/facilitating, and provoking original thought &/or action.  I wish to conclude this portion of the conversation with this quote:

There is a basic difference between the leader and the organiser. The leader goes on to fulfill his desires, to hold and wield power for the purposes both social and personal. He wants power for himself. The organiser find his goal in creation of power for others to use. – Saul Alinsky

I leave you to decide whether I fit the description of the leader or the organiser.

What Has The Process That Keeps The Customer & Leadership Blog In Existence Unconcealed To Me About Myself?

Let me be clear, I started with what occurs to me as altruistic motive.  I continue with the same altruistic motive – declining opportunities to write paid for content and pass it off as my work, to accept advertising, refusing speaking opportunities which are paid for PR/marketing for some business or other.

Despite or because of my altruistic motive, I have gotten a HUGE amount out that has left me enriched:

First and foremost, The Customer & Leadership Blog saw me through some of the darkest times of my existence. Where the world that constituted my world slowly disappeared. I am talking about the world of sports/activity: Paragliding, trekking in the mountains, going backpacking in third world countries, cycling, tennis, badminton, even something as simple/joyful as table tennis.

Second, In the process that is the Customer & Leadership Blog my image of myself shifted.  I start out thinking that I was a pygmy in the land of giants – that I had nothing to say that was worth listening to. Further, I was convinced that I could not write. Today, without hesitation nor doubt I say that I show up for myself as a thinker-writer-speaker who is worth listening to by those who know who/what to listen to.  It doesn’t stop there, I learned much more about myself.

Only as a result of these two blogs did I realise that I am more than a thinker.  I realised, that I create (these original conversations) therefore I have the capacity to be creative. What joy this realisation / experience brings!  What is the experience that I am seeking to share with you?  Allow me to point you towards that direction by sharing this quote:

Curiosity, irreverence, imagination, sense of humour, a free and open mind, an acceptance of the relativity of values and of the uncertainty of life, all inevitably fuse into the kind of person whose greatest joy is creation. He conceives of creation as the very essence of the meaning of life. In his constant striving for the new, he finds that he cannot endure what is repetitive and unchanging. For him hell would be doing the same thing over and over again.  – Saul Alinsky

Yes, fundamentally I am curious, I have that free and open mind, and accept the relativity of values/positions/theories and the inherent uncertainties that come with finding oneself in living in a complex non-linear world where prediction/certainty is for those who are either naive or fools.  Which kind of explains how it is that I have deliberately sought to make friends with folks from different countries, different faiths, different ages. It also explains how it is that my interests/thinking spans science, philosophy (eastern, western), history, psychology, sociology, anthropology, ecology, systems thinking, chaos/complexity….

Is it possible that it is irreverence that lies at my core?  It hasn’t escaped my notice that the subtitle of this blog is: “provocative conversations: questioning conventional wisdom / stimulating original thinking.”

They say you remember the moments in your existence that really matter. I must have been between 8 and 10 years of age.  Unhappy. Perplexed. Desperate to figure this thing out. What thing? Why is it that the stuff the (white) folks teach me at school about good/bad, right/wrong differs from and contradicts that which my parents (and their relatives) insist is good/bad, right/wrong?  Then one day, one moment, outside walking, a thought/insight arises and hits me.  It does not leave me the same person – it changes me fundamentally and forever.  Which thought/insight? Here it is:

Its ALL made up!

Once I got that, I started pushing the boundaries – at school, at home. I became the person who questions that which is taken for granted.  The one that asks the difficult questions like “Why be a team player in a competitive individualistic culture and economic system? Do you think I am stupid? What is a team player – one who censors self to fit in with the powers that be – you?  Why should I be that kind of person?  Anyway, why should you get to define what constitutes team playing?” Or”What makes you certain that your religion is the only true religion, that your way of life is the right one?”

There is a Chinese saying which goes something like “Beware, every stick has two ends, when you pick up a stick you get both ends!” I can vouch for the truth of that.  Curiosity, open mindedness, acceptance of relativity of values/perspectives, and especially irreverence have brought me great learning, memorable experiences, and joy.  That is one end of the stick.  The other end is that almost always I find myself the Outsider. And folks do not like that which they hold dear questioned. They don’t even like the opinions/prejudices/’facts’ they picked up from their media to be subjected to Socratic questioning or my blistering critique.

My professional existence is been that of a traveller: travelling from one employer to another, moving from domain to another.  History suggests that I tend to last about two years in an organisation. At about that time I usually find myself bored – having learned that which there was to learn. And/ or I find myself facing a ‘superior’ who shows up for me as ignorant/stupid/arrogant or just a bully.

There’s an ancient story of The Oak and the Reed. According to this tale, the smart choice is to be the flexible/supple reed. I am the reed when it comes to means to accomplish ends. When it comes to values/ends and the way I have chosen to show up and travel in this existence I am the Oak. Why?  Because these matter – these are what I choose to orient/navigate my existence by.  How important are they to me?  This quote says it all:

“A man is not made for defeat,” he said. “A man can be destroyed but not defeated.” – Hemingway, The Old Man & The Sea

What Has This To Do With Customers and Leadership?

Good question.  Allow me to respond with a few questions of mine:

Do you identify with the customer (see the Clarence Darrow quote at the beginning of this conversation) and so are committed to simplifying/enriching the lives of your customers? Or are your in it purely for yourself – to make a name for yourselves, to get rich?

Are you playing the Customer game because it is THE game that you want to play because it is THE game that calls you – your deepest self?  Is playing this game the expression of your deepest self?

Do you have or are you cultivating the curiosity, the open mindedness, the awareness of the relativity of perspectives, and the inherent uncertainty of existence to get out of your existence (your default existence) and really enter into / live the lives of your customers? And thus to generate original insight, and cultivate empathy, for your customers?  How can you simplify/enrich their lives if you do not truly understand them – not as mere personas nor statistics – but as concrete human beings?

Do you get all that is – you, your organisation, the economic model, society as such – is all made up?  And are you up for unmaking that which is necessary to unmake to become a giant in the Customer arena – as seen through through customers’ eyes?  Is this a mission that appeals to you – calls forth intellectual interest and emotional passion? How do you know that passion is present?  Passion brings boundless energy and it does not get stopped by obstacles that appear on the path.

Are you willing to pay the price that comes with questioning the status quo and threatening the powerful who seek to lose by the changes you are proposing to make or making? Are you willing to be that Outsider?  Are you willing to accept Hemingway’s truth that a man is not made for defeat, that he can be destroyed but not defeated?

If you answer these questions honestly you may get why it is that few are successful in calling forth genuine loyalty between themselves and employees, between themselves and their value chain partners, between themselves and their customers, between themselves and the communities in which they operate.

Thank you for your listening, I wish you the very best, until the next time.

 

Putting The Customer At The Centre of Your Business

Now and then a question comes along that provokes my thinking. Here’s a question that I came across recently expressed in different ways:

  • What does putting the customer at the centre of the business look like?
  • What does it mean to put the customer at the centre of the business?
  • What are the implications (for us) of putting the customer at the centre of the business?

Stop. Hold the automatic weapons fire – the hail of ready made generic and almost always abstract and theoretical answers.


Many years ago I came home after a long difficult day. Upon entering our flat my two year old rushed towards me with a huge smile and with both his arms held up. As I lifted him up and gave him a hug, I found myself making a decision: to put him at the centre of my life.

Grappling with that question it became clear to me (over some weeks) that it meant that his wellbeing came first. That my decisions and actions had to be mindful of the impact on his well being. It also became clear to me that his wellbeing was tied to the wellbeing of his mother – he spent most of his waking life with his mother.

Did it stop there with that abstract realisation?  No. Looking at the way of my living it became clear to me that work came first in the way I showed up and travelled. My son and his mother, got what was left for me to give after I had given all to work. As I was often away from home during the week this meant that he got to spend time with me only at the weekends.

I made a decision – to do just enough at BigConsultingCo whilst actively looking to move to a smaller more local employer. Within a year, I left BigConsultingCo and moved over to a software company which was five minutes drive from home. And for which I did not have to travel….

Let’s be clear on one thing: putting my son’s wellbeing first meant, for me, giving up chasing the promotion to partner in BigConsultingCo.  It also meant leaving a world with which I was familiar/comfortable and walking into a new industry / new company and having to learn a new way of doing business.


Back to the question of putting the customer at the centre of your business – your particular business.  What are your answers to the questions I shared earlier?

It occurs to me that you can put the customer at the centre of your business in at least two ways. You can take the busy road where you will find many: you can put the customer at the centre of your business with a view to learning all you can about that customer, and using that knowledge to influence, shape, manipulate customer behaviour so as to enrich you.  Which may account for the fact that customer loyalty has been declining even whilst big brands have been spending a fortune on their IT armoury.

Alternatively, you can take the road less travelled. You can focus your efforts on gaining a deep understanding of your customer and using this insight to enrich the life of your customer.  How do you enrich the life of the customer?  No generic answer will do.  You have to generate this answer for your customer, your business.  It requires insight – insight into the life of your customer, the expressed needs, and the hidden unexpressed needs/wants.

Apple has enriched the life of their customers through compelling/superior products, a distinctive/superior in-store experience, and premium image.  Amazon has done it through an effortless convenient shopping experience and value for money pricing.  John Lewis has done it through a combination of good products, outstanding service provided by friendly knowledgeable human beings, and a culture of integrity.

Enough for today. I thank you for your listening and wish you the very best. Until the next time…

 

Against Slavery to Ideology & Method

The older I get the more I notice that the autonomy and the intelligence of folks in large organisations is put at the service of some ideology and/or method that has taken root in the heart-mind of someone higher up in the organisation.  Typically, this happens when that particular ideology (e.g. “customer-centricity”) and/or method (e.g. “Agile”) has planted itself in the wider business world.

What’s the impact?  Allow me to convey the impact through the following assertion made by Jean-Jacques Rousseau:

“Man is born free and everywhere he is in chains.”

What tends to show up when folks in organisation are ‘in chains’ to some doctrine/method?  This is what I have observed: Stupidity, game playing, and a decrease in effectiveness.

Adherence to the doctrine/method surpasses reasoning hence folks end up doing stuff which they know does not make sense.  To get things done it is often necessary to bypass-bend the doctrine/method.  Therein starts the game playing – making it look like the doctrine/method is being followed when it is not.  The overall impact is a decrease in effectiveness. By effectiveness I mean both outcomes and the workability/capability that generates the  outcomes.

New ideology, method, toolset is introduced with great fanfare. Yet with little understanding: know-how as well as know-what and know-about.  Given sufficient time performance declines.  The Tops and Middles blame the people.  Clearly given the God given status of the ideology/method/toolset the people have to be at fault.  They are not following the method.  I have yet to see the suitability of the method/tool being seriously questioned.  As a result, adherence to doctrine/method is tightened rather than relaxed.  This further degrades the workability/capability of the organisation.  I refer to this as layering stupidity on stupidity.

What is an intelligent way to go about leading-managing an organisation?  Forget doctrine / ideology. Forget method.  Forget blind obedience to anything. Instead focus on calling forth the collective intelligence of your people AND enhancing the workability of your organisation. Let me put this simply: take a zen stance, let fall all fixed thinking (ideology, doctrine, methods, tools..), go to where the action is occurring, and look – really look. Then select the right course of action / method / tool. Once the method/tool has served its purpose, drop it! Like the canoes, when you have used it to cross the river, leave it there at the side of the bank.

Allow me to end this conversation by sharing this story with you:

When the bishop’s ship stopped at a remote island for the day, he determined to use the time as profitably as possible. He strolled along the seashore and came across three fishermen mending their nets. In pidgin English they explained that centuries before they had been Christianised by missionaries. “We Christian!” they said, proudly pointing to one another. The bishop was impressed. Did they know the Lord’s Prayer? They had never heard of it. The bishop was shocked.

“What do you say, then, when you pray?”

“We lift our eyes to heaven. We pray, ‘We are three, you are three, have mercy on us.”

The bishop was appalled at the primitive, the downright heretical nature of their prayer. So he spent the whole day teaching them the Lord’s Prayer. The fisherman were poor learners, but they gave it all they had and before the bishop sailed away the next day he had the satisfaction of hearing them go through the whole formula without a fault.

Months later, the bishop’s ship happened to pass those islands again, and the bishop, as he paced the deck saying his evening prayers, recalled with pleasure the three men on that distant island who were now able to pay, thanks to his patient efforts. While he was lost in that thought, he happened to look up and noticed a spot of light in the east. The light kept approaching the ship, and the bishop gazed in wonder he saw three figures walking on the water. The captain stopped the ship, and everyone leaned over the rails to see this sight.

When they were within speaking distance, the bishop recognised his three friends, the fishermen. “Bishop!” they exclaimed. “We hear your boat go past island and came hurry hurry meet you.”

“What is it you want?” asked the awe-stricken bishop.

“Bishop,” they said, “we so, so sorry. We forget lovely prayer. We say, ‘Our Father in heaven, holy be your name, your kingdom come…’ then we forget. Please tell us prayer again.”

The bishop felt humbled. “Go back to your homes, my friends,” he said, “and each time you pray say, ‘We are three, you are three, have mercy on us!”

Summing up: Many, many, many leaders/managers can do with keeping this story in mind, putting aside the arrogance that goes with their elevated roles, and adopting the pragmatic humility of the bishop.  Focus on workability and use whatever method/tool is appropriate. Do not make a God of a specific doctrine, method, tool.  If you are going to make a God out of anything, then make a God out of your people – their potential to do amazing work and create amazing works.

Enough for today. I thank you for your listening and wish you great living. Until the next time….

 

Mary: What Kind of a Difference Does Generosity Make?

IMG_MaryIf you want to attract customers then you must have something that pulls customers to you.  If you happen to be in the business of selling fine chocolates then good service is necessary but insufficient.

In the fine chocolate business the ‘product’ matters.  By ‘product’ I mean both the quality (taste) of each chocolate and the range of chocolates.  It is the ‘product’ that calls the customer and pulls him back to your business – your store.  I have witnessed folks put up with poor service just to get their hands on the ‘product’ at a competing brand.

So, it is the ‘product’ that Mary makes-sells that drew me the Mary store in the Royal Galleries (Brussels) last week. Yet, I am not writing this because of the ‘product’.

I am writing this as an expression of my sense of gratitude. Gratitude to whom?  Gratitude to the two fellow human beings (Olivier, Eda? ) who served me.  Language fails here: serve is not the right word.  Yes, they provided service. No, they did not merely serve me.

What is it that made such an impact on me?  Their way of being was professional yet human/warm/considerate. Clearly, they knew/cared about their ‘product’ (the chocolates). And, I was made to feel welcome.  Yet, this is not it. All this is necessary yet not sufficient.

What really made the difference?  Generosity.  Olivier offered me several chocolates to taste whilst he was putting the selection together.  Eda? offered me some chocolates whilst Olivier was working the cash till. Both of them were generous in dancing with the conversation that I initiated.

Lesson: If you wish to be granted a space in the hearts of your customers it is necessary to cultivate gratitude in the hearts of your customers. A great way to cultivate this gratitude is through generosity in your way of showing up and travelling in this world. Reciprocity ensures that most of us, most of the time, remember and repay our debts.  The catch here is that the generosity must be genuine and not a technique for getting the better of your customers.

It occurs to me that the real measure of customer-centricity is generosity.  Which is why so many large organisations struggle with the Customer thing.  Interestingly, I have found Amazon to be the exception as I have experienced acts of generosity from Amazon. Each time those acts have left me feeling delighted.

 

 

 

 

What Does The Doublespeak of Customer Love Disguise?

Looking beyond the doublespeak of customer-centricity, customer engagement, customer love to see what is truly there.

In his latest post Andrew Rudin questions the advice of customer experts and provides his take on the language that has come to pervade marketing, sales, service – business in general.  Allow me to share a passage or two from his post:

“We’re bombarded with messages from experts about getting close to customers. How close? Really close! Lustful words like embrace, love, and passion have migrated from romance novels into business blogs. Marketers freely infuse love as a marketing schtick, with buyers as the intended objects. But when sellers get amorous, I remember the words to Are You With Me Baby? by the LeRoi Brothers: “At least tonight, you know that I’m in love with you.” Explanation, not needed.”

In this conversation I wish to look beyond the fashionable language and see what shows up.  Let’s start with the role of the customer in business.

What Is The Role Of The Customer In Business?

Let’s look at business as a system for creating value.  The first question is this one, who truly matters? Look into the very constitution of company and company law. You will find it is the shareholders – specifically the shareholders who individually or collectively control the voting rights.  Next question, what is the ONLY concern of shareholders?  Wealth.  Shareholders of the business are looking for the Tops (at the helm of the business) to generate wealth for them .

Which brings us to the role of customers. What is the role of customers in business?  I say it is to enable the business to survive and thrive by feeding the business.  What do I mean by feeding the business? I mean to provide the money that the business needs. Put differently, customers are the source of cash that flows into the business and keeps the business going.

What can we conclude?  How about this, a customer is only of importance (valuable) if s/he is source of cash flowing into the business.

What Is The Extrinsic Value Of A Customer To A Customer-Centric Business?

Anyone who truly understands the genesis and true meaning of customer-centricity will be familiar with Customer Lifetime Value (CLV).  How does one calculate CLV? Be estimating a figure for the lifetime (years, months), then estimating the value (revenue, contribution..) that this customer will generate for the business over the lifetime.  The smarter folks will discount the value to take into account the time aspect of money.

Here, I draw your attention to a critical point. The past does not count, only the future counts.  What the customer has contributed to the business in the past is irrelevant.  It is only his value to the business in the future that counts.

Why calculate CLV?  To differentiate between customers. In my days at Peppers & Rogers it was the done thing to perform the calculation and then put customers into three buckets: MVCs (most valuable customers), MGCs (most growable customers), and BZs (below zero). And the corresponding ‘strategies’ were to retain MVCs through great service / preferential treatment, increase the value of MGCs by persuading them to buy more at higher prices (x-selling, upsetting), and get rid of the BZs as they were taking value away from the business.

What is going on here?  Pure self-interest.  As Tops we wish to enrich ourselves – earn and walk away with the greatest wealth for ourselves. To do that we must please the shareholders.  To please the shareholders we have to generate as much as value as we can. To do that we need to focus on customers – those customers who hold the promise of generating the most value for us ‘today and tomorrow’.

Here I wish to add that the drive to automate interactions between the customer and the business saw its genesis in the promise of technology to cut down the cost of customer interactions by replacing employees with technology.  By cutting down the costs the value generated by customers, as in CLV, could be increased – sometimes substantially.  The fact that automation of interactions led to benefits to customers was an added bonus – not the primary motive. Disagree? Then answer this question, why have IVRs proliferated rather than being ripped out?  Customers hate IVRs and have hated IVRs for years.

What Value Does Business Place On The Intrinsic Value Of A Customer?

Look beyond the label of customer. What do you see?  I see a human-being – a flesh and blood human being.  Is there any intrinsic value to a human being.  Let’s take a look at that by examining real life examples.

When I see a pregnant woman, a fellow human being, standing on a train, I offer her my seat. Usually I don’t even get to do that. Why? Because some other man or woman has offered her a seat by the time I open my mouth.

When I see an elderly wo/man with what looks like heavy luggage I offer to carry that luggage up and down the stairs – usually at train stations. I do so without being asked.

Once I was in a Deli – some 10-15 years ago. Whilst ordering lunch (sandwiches, drinks…) I notice a young lady. She was not dressed well. She had a handful of coins and she was counting them.  She looked hungry – I saw her face looking at the product. Yet she ordered a tea. I calculated that this was the case because she could only afford a tea. All this happened in seconds, maybe a minute or two.  Immediately, I took out £20 and gave it to her.

When it comes to birthdays and Christmas, I ask folks not to give me presents. I tell them if they wish to contribute to me then they should do so with cash.  Do I need the money? No. So why do I ask for it? Because I get joy out of putting that money into Kiva and then using it to fund folks around the world, who have ideas but lack the money, to build better lives for themselves and their loved ones.

Am I the only one doing these things? No. One of the people I value highly is the President of a leading player in the VoC market. He travels a lot. When he travels he helps folks put their luggage in the overhead compartments. It is not an option for him to not help those who need help. And he gets joy out of this.

I suspect you, also, have at some point in your life carried out an act of kindness. If not, then I suspect you have read about, seen or witnessed an act of genuine human kindness and been moved by it.  Why?

Here is my answer. We ‘know’ at some deep level that there is intrinsic value in a human being – a human life. Why? Because, for the most part, most of us are brought up that way: to value human life, to treat folks right….. To be helpful members of society.  What is heroism but the sacrifice of oneself for the wellbeing of our fellow human beings?

What about the business world?  Does the business world of largish corporations recognise and honour the intrinsic value of a customer as a fellow human being?  Look into this and you will find that aside from small scale community based ‘mom and pop stores’ there is no genuine relating between the business and the customers. A small ‘mom and pop store’ where mom and pop work will get to know their customers: their backgrounds, their family, their hopes and dreams, their challenges…. their intrinsic value.  Not so the case in corporations where the roles remain but the folks that fill those roles is like hotels: the rooms are the same but occupied for short periods of time by many guests.  Further, and this is important, genuine human relating is not permitted in corporations.  What is permitted, even encouraged, is fake relating: scripted interactions, scripted smiles…

When is the last time that a largish corporation paid for life-saving treatment for one of its customers? Or took actions that take time and money to make a customer’s dream come true?  Yet some celebrities have done exactly that for their fans. And folks in communities get together to do that if one of their own is in need.

No, the business world of corporates is blind to the intrinsic value of a customer, any customer.  The only value that counts is the extrinsic (CLV) of the customer – however this is arrived at, whether by intuition or by making complex calculations.  I, the corporation, do something for you if and only if the calculations shows that you will do something for me which is of higher value so that there is good ROI for me.

Summing Up

Without friendship life is hollow which is why almost all of us seek and cherish our genuine friends.  Without love for some person or some activity life is missing something essential. Without being loved by someone or some community life is missing something that is essential to our well being.

So relationships do matter. Love does matter.  However, it would be foolish to expect this kind of relating occurring between a customer and a corporation.  And experts/gurus encourage companies to love customers is pure BS.

Yes, the language that folks in business and those who make a living from pandering to businesses (the media, business gurus, consultants, professors…) has changed.  It speaks of customer engagement, customer relationships, loyalty, customer love….

No, the game of business has not changed.  The game is the same as it has always been – causing ‘surplus rents’ for Tops (in the form of pay, bonus, shares) and Shareholders.  All the Customer talk is doublespeak – it disguises the transactional orientation, it disguises the lack of morality and ethics in big business.

I leave you with this thought / assertion: It is easier to change the words, the images, the slogans, the story than it is to change the system (purpose, values, priorities, people, roles, relationships, practices, tools…).  Therefore, in the absence of a catastrophic breakdown, only the words, image, slogans, and stories change.

I thank you for your listening and I wish you the very best.  Until the next time….

The Customer Speaks: Customer-Centricity Through The Eyes Of The Customer

I hear you.

I hear you say that you (as an organisation) are customer friendly.

I hear you say that you (as an organisation) have a strong customer orientation.

I hear you say that you (as an organisation) are committed to delivering great customer service.

I hear you say that you (as an organisation) deliver a great customer experience.

I hear you say that you (as an organisation) are customer-centric.

I even hear some of you say that you (as an organisation) are not merely customer centric, you are customer obsessed!

Yes, I hear you – all of you. And you all sound pretty much the same.

I have a question for you. Can you guess what my question is?  If you are so in tune with your customers (folks like me) then you should have no issues in figuring out my question. Have you figured it out?

Here is my question (in various guises) as your customer: What specifically can I count on you for?  What is your promise to me?  What is it that you guarantee me?  

No! I am not interested in hearing about your mission statement nor your corporate values.

No! I am not interested in your brand positioning or values.

No! I am not interested in your size, your growth, your global scale…

Let me ask again, as your customer: What specifically can I count on you for?  What is your promise to me? What is is that you guarantee me?  

[Silence]

By the way it is not enough for you to make me a promise.  For this promise to be credible it has to be public. Yet even a public written promise is not enough.

A written public promise to me, your customer, is merely the starting point for showing me that you are serious about treating me fairly as your customer.

What else do I expect from you? I expect you to:

  • tell me clearly and precisely what it is that you expect from me – in order for your promise to apply to me; and
  • set out what exactly I can count on you to do, by when, as and when you fail to keep your promise.

By the way I am taking it for granted that you will figure out when you have failed to keep your promise. And that where I am the only one that knows that you failed to keep your promise, you will make it easy/quick for me to bring this to your attention.

Finally, I’d have a lot more confidence in your promise if you were to share up-to-date information on how you (as an organisation) are doing in keeping your promise to your customers  – this information needs to come from a credible independent body.