Why do Customer-Centric Organizations Fail?

In an earlier post on customer-centricity I had argued that executive reviews rarely go beyond the numbers (revenue, subscribers, traffic, etc.) and fail to capture a more powerful growth engine – our customers. But, what if our strategies are built around customer success, yet the goals are not achieved? 

There could be a multitude of reasons namely, market saturation, competitive pressures, product quality, marketing success, operational effectiveness, etc. While most of the listed here may be in play, in some form or the other, I want to bring our attention to “operational readiness.” 

We can hire the best consultants to design our product, consumer and marketing strategy, but it is our operational readiness that will determine how well we deliver on this strategy. 

Let’s take an example, we have our corporate mandates such as; expand our footprint, diversify our product offerings, increase ARPU, reduce cost, sign a new partnership, etc. We conduct due diligence, come up with a strategy to achieve that objective, and with a fancy deck, will have all the approvals needed for a launch. However, there is often a need for "incremental investments" and a shift from "corporate ways" that are critical for our operations to deliver. 

In my experience at leading new product launches and customer-facing site enhancements, the build phase often springs up unexpected surprises that either cause delays, or force a go-ahead with a compromised product/service features. These could be in the form of systems and process updates (may require capital investments), shift in strategy to offer a "beta" version of the product, shrink the scope of support offered through CRM, etc. As a P&L manager, it is important to highlight the larger gains and keep the project ROI positive and within acceptable range.

A well thought out and “realistic” implementation plan should be integral to the strategy deck for a new initiative. 

So, don’t underestimate the value of conducting due diligence and investments around building operational capabilities to meet the strategic goals. That is one activity which will significantly impact the success of; new product launch, analytics integration, a website redesign, and systems upgrade, etc.  

The bottom-line is that the cost of an unsatisfied customer is far too high to under-estimate the costs of poor delivery. 

In one of my client engagements, I had to re-evaluate the product features and SLAs that were agreed upon with the partner, as these were leading to customer complaints and unacceptable levels of churn. Part of the strategic redo included a better communication collateral for sales and marketing channels. The compromises made during the launch to meet the deadlines would come back to bite so quickly - no one had imagined! 

Corporate Innovation is at Risk ...

A new product or service does not come around every day. Organizations are built around the core innovative idea and thrive on systems, processes and capabilities to manage subsequent growth. In more mature organizations, repeatable processes are created to deliver the value, service and support to customers. However, this "order and routine" also leads to a corporate culture that becomes “inhospitable” to innovation. Let me share a great quote from one of marketing's leading innovative thinkers - this would become my inspiration for this post. 

“Organizations by their very nature are designed to promote order and routine. They are inhospitable environment for innovation.” - Ted Levitt.

How can we look at innovation in a mature organization?

As someone has said, “innovation is anything, but business as usual.” Most daily tasks in an office tend to fall into the routine job duties, but the teams need to be encouraged to challenge the status quo and find ways to improve product, service, processes. In other words, INNOVATE! 

Let’s take an example of a project meeting that I participated in. While trying to resolve the poor quality complaint on a new product, it was brought to our attention that often the call-issue is not captured and/or is categorized inaccurately in CRM system. Adding a new complaint code based on new service would have seemed like an obvious next step, but, the support team was reluctant to do so, as it would overload the already complex list. A deeper dialogue revealed that patching the legacy systems (linear fix) was no longer a viable option and our analysts suggested an overhaul of CRM-coding that better represented the new business and customer experience priorities (innovative fix) . I saw the innovation happen right there!

Innovation does not start at the CEO level, or even at one or 2 levels below. It can just as easily start at the lowest level, amongst the troops in the trenches. It is our analysts and managers, who are interacting with the customers, vendors and internal stakeholders that are most aware of the issues and probably can help lead or collaborate on more pragmatic go-forward strategies. 

If you happen to be in such advanced organizations, don't be surprised if the next great idea for customer service, cost efficiency, reporting, etc., comes from one of the many of the "routine" meetings. It is these voices that need to be heard! It is this “out of the box” thinking that needs to be encouraged! It is this "corporate culture" that needs to be nurtured! It is the senior leaders who should lead such "corporate innovation” by encouraging participation and curbing the “quick resolution” mindset.

Corporate innovation can only be kept alive if we let the “bottoms-up” approach to flourish.

Here are a few ideas to encourage corporate innovation:

• Tying manager performance with matrix feedback from colleagues, which will ensure that managers are encouraging participation
• Training project managers to record and follow-up on any “out of the box” initiatives that emanate from the routine meetings, instead of staying focused on task lists
• Senior leadership finding time to discuss those ideas, not always relying on a formal business case to justify the time/resources spend
• Institutionalizing a reward system for innovative ideas and solutions, and making sure idea, and NOT the value, is recognized - value invariably follows!

Corporate innovation, if done right, holds real promise for more mature organizations. It ought to be at the core of corporate culture and true leadership here would improve employee engagement, get them vested deeper with the organization’s success, and may significantly contribute to the bottom-line.

* image from: awma.org

Big Data – Framework to Be Smarter with Analysis

Marketers use data to assess campaign success, allocate budget, delineate customer analytics, design new products, optimize acquisition and retention, etc. However, with multiple data sources and owners, organizations often struggle with consolidating the right data and reporting to fully answer the questions asked. Along comes big data!  

Big data is exciting and challenging at the same time, since it affords a holistic look of customer analytics, yet exacerbates the complexity due to legacy data-silos and stakeholder needs.

This is a call for "smarter” approach to defining and using big data for tactical and strategic marketing objectives.

For marketers, a mapping exercise, as below, may help create a framework of available and needed data and systems. The layout identifies the evolution of data capture and applications, as organizations mature, and highlights the value being injected back into the business. It is telling in different ways – gaps in data capture, systems limitations, analytical resource allocation, etc. But most importantly, it highlights the need to innovate and upgrade legacy systems such that the analytics efforts can be targeted for the greatest impact and ROI.

It must be noted that the data silos are identified as they relate to customer analytics. Note that, as a marketer, I am looking into our current systems, so we can model returns from existing capabilities and tie the improvements to enhanced future investments. In other words, try and look at the parts to solve for the whole - get some short-term wins to articulate investments and the need to be on an "analytics fast lane.”

The question to ask of the management is – here’s where we are and here’s where we can be. Are we ready to invest?

The framework may help articulate big data scope and ROI, and also facilitate:

• Breaking down projects into chunks of easily manageable proposals
• Identifying the next big investment 
• Developing internal capabilities (organizational and personnel) 
• Providing a launching pad for execs to commit to larger projects

With investment along X-axis, we can improve our capabilities along Y-axis, which in turn, contributes to the growth trajectory graph.