February 17

How Well Do You Know Your Customers?

I have met many MDs or CEOs who think that their company was customer-centric. I’ve been preached to time and time again about how “we know what products and services our customers like and we even know what they want us to improve upon”. It’s at this point I usually smile and politely respond; “I rest my case. Haven’t you’ve just told me all about your ‘stuff’ and nothing about your customer?” At this point the realisation that there’s a lack of something I call ‘organisational self-awareness’ usually kicks in. They realise that it’s not good enough to ask customer’s occasional questions but a necessity is to engage in constant dialogue in order to have a ‘relationship’ with them.

Being truly customer-centric isn’t about showing them what you’ve got and asking them if they like it. It’s about looking at the world from their perspective and appreciating the problems and tensions they face and the things they aspire to. When you do that you start to build ‘relationship equity’ because you’ll be listening more than talking! Without the right insight it’s more likely that what you do will be more about what’s best for your organisation rather than your customer. It’s the ‘here’s what we have, how can we sell it to you’ approach instead of the ‘here’s what we know you want so please form an orderly queue’ approach.

When you know your customers and I mean really know your customers you’ll start to focus on solving their problems and tensions and when you go beyond selling products and start solving problems you start to fuel innovation and differentiation. Why, because in the modern fast paced commoditised world we operate in it’s no longer about ‘what you do’ it’s about ‘how you do it’. Your competitors can copy products along with everyone else but they won’t be able to do it like you do!

“We have only two sources of competitive advantage. The ability to learn more about our customer faster than the competition and the ability to turn that learning into action faster than the competition.”
Jack Welch
Former Chairman & CEO – GE

When you start to push forward in this way you shift your customers buying decision from the head to the heart. You’re now solving problems and that means it’s emotional because you now have a relationship with the customer that’s more than just transactional. There are two points when customers talk about your business. The first is at the very bottom of the scale, when you’re pretty ‘Poor’ at what you do and unfortunately your customers will let everyone know about it. In the middle sits ‘Good’ but no one really mentions this as ‘Good’ has become the new ‘Average’. At the other end of my scale is ‘Exceptional’ and this is the second point where people talk but when you’re here the talk is of brand loyalty, recommendation and constant endorsement, even Love!

The difference between a customer who is ‘Unsatisfied’ (You’re Poor) or merely ‘Indifferent’ (You’re Average) isn’t that great but the customer who camps out for weeks in front of your flagship store because they just have to have your latest product does that not merely for the product itself but because your organisation is ‘Exceptional’.

The customer-centric organisations that sustainably differentiate do so because they understand the symbiotic relationship they have with their customers. They understand that the customer is there to provide them with problems and tensions and their purpose in the relationship is to find innovative and differentiated ways to relieve their customers of such. The benefits for both and what they get out of it are obvious but never the primary focus. What they have done in adopting this ‘Strategic Mindset’ is moved beyond the traditional lip service or at best superficial attempt at customer focus and orientated their business model around a different perspective. However this means creating a different organizational approach to how you do what you do as it also involves being what I call ‘People-Centric’. Striking the right balance between customer pleasure and shareholder return will always, always be done through your people. Whatever you think there’s absolutely no way to circumnavigate the journey to customer centricity without first becoming people-centric.

To do this, everyone in your organisation needs to understand how to collaborate on solving your customers’ problems in order for you to provide an exceptional end-to-end customer experience. Your customer’s voice must be clearly heard in your organisation every day. In fact, your customer should be thought of as ‘part’ of your company. Think of yourself as working with them not for them – that’s more symbiotic!

One of the big challenges for 2011 will undoubtedly be employee engagement and what better way to embrace it than allowing your people to forge stronger customer relationships. Involve your people and show them that they are important by empowering them to ‘take care’ of their customers by providing value-added, common sense solutions. Allow them to build relationships and thus equity and the net result will be far happier, engaged employees. Make that a strategic focus and you’ll create a non-silo based, problem solving, innovative culture that has the agility to react to customer need or market shifts rather than be immobilized as it would be in the traditional product-centric or sales culture.

So, in the same way your customers aren’t ‘Transactions’ your people aren’t ‘Resources’. Create a true relationship with your people and inspire them to be exceptional. Then passionately forge a relationship with your customers by replacing products or a ‘product-centric’ model with solutions as the fundamental part of your value proposition. If everyone and by everyone I mean you, your people and your customers are aligned, engaged and share purpose then differentiation, innovation and shareholder return will be your natural by-products.

Good Luck!


Customer Centricity, Differentiation, Employee Engagement, Innovation, Strategy

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