Building a customer-centric organization

In recent years, customer centricity has recently emerged as part of an organization’s vision, mantra, strategy and corporate objectives. This is brought about by the fast-changing and diverse customer preferences.

But customer centricity, as a concept and a practice, is nothing new. It was popularized by Lou Gerstner, the chief executive officer (CEO) of IBM back in the 1990s and responsible for transforming and turning around the ailing company. He had to change the culture and mindset of the employees into a customer-centric one that put customer first instead of wallowing in the elephantine bureaucracy of IBM. It entailed changing structures, processes and practices that turned IBM into a services company.

But that was back then. Times have changed. Customer needs, wants and preferences are now quickly ever-changing. This is personified by the different demographic customer generations that are converging today — from Gen Z, Millennials, Gen X, and Baby Boomers; or different psychographic segments, such as the adventurous, laid back or family-oriented segments. Organizations need to serve these customer groups who have ready access to information and with multiple available options, while creating a positive customer experience and eventually making them loyal advocates. These make competing for the mindshare purse, and loyalty of the customer more challenging. The bargaining power of the customer has never been as high as it is now.

That’s why customer centricity has taken on a new meaning to reflect these changes.

Customer-centricity is a strategic approach to doing business that focuses on providing a positive customer experience both at the point of sale and after the sale, by maximizing the value that the customer derives from the product or service and converting them into loyal advocates, thereby driving sustainable profit for the company.

The key operative word in this definition is “strategic approach,” which means that all customer centricity initiatives, programs and projects of the organization must be cohesive and integrated to make sure that the positive customer experience is experienced in all touch points in the organization — may it be customer-facing sales people and website, to backroom operations and support activities. It doesn’t start and end at building a unified portal for customers to buy online, but encompasses not only direct touch points, but all support one as well such as technology systems as well.

Customer centricity is not also built through corporate trainings that focus on tools and methodologies on how to answer irate customers, nor on appealing on the motherhood term “purpose” of each employee to naturally serve customers.

Key to building a customer centric organization is transforming the business owners’, board members’, and employees’ mindsets. This involves breaking down silos that are prevalent in many local organizations. A silo mindset is one that is present when certain departments or sectors do not wish to share information with others in the same company. This type of mentality will reduce efficiency in the overall operation, reduce morale, and may contribute to the demise of a productive company culture.

Change starts from the top. The CEO together with his or her lieutenants should display collaborative behavior and cross-functional communication. They should mandate their employees to institutionalize interdepartmental meetings to jointly solve customer problems and come up with new ideas. There should be task force, sponsored by the CEO and headed by a senior executive, charged with breaking up silos and developing practices that require collaboration and communication. Instead of departmental competition during Christmas parties, why not promote cross-functional group performances? Apart from departmental team buildings, why not promote other interdepartmental activities?

Moreover, employees should undergo reskilling and coaching to change behavior, attitudes and mindset. In our consulting work, we have identified three skills that are at the root of customer centricity that need to be developed and practiced — empathy, collaboration and complex problem-solving/agile decision-making. Through classroom training, role-playing and on-the-job coaching, employees will develop empathy toward colleagues and customers, and learn how to collaborate with other groups to jointly solve problems and make decisions.

All these coupled with digitizing customer touchpoints in an integrated cohesive manner will build a customer-centric organization.

But customer centricity as a culture, is not an easy to build. At times, it needs drastic moves such as letting go of certain employees and introducing fresh blood and new leadership into the organization to mandate changes.

 

The author is co-founder and chief executive officer of Hungry Workhorse, a digital and culture transformation consulting firm. He is the country representative of the Institute of Change and Transformation Professionals Asia and fellow at the US-based Institute for Digital Transformation. He teaches strategic management in the MBA Program of De La Salle University. The author may be emailed at rey.lugtu@hungryworkhorse.com.

Source: https://www.manilatimes.net/2020/02/27/business/columnists-business/building-a-customer-centric-organization/696935/

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