Biggest Obstacles to Becoming a “Customer-Centric” Business
This is the 1st article of a 2 part mini-series on building a “Customer-Centric” business.
Some of my audiences have questioned my emphasis on the Top Executives and their critical importance to any successful shift towards an organization becoming a “Customer-Centric” Company. Some of my readers have asked me why is it that I focus on the Top Executives and not the Middle managers and the Frontline employees. 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 would you approach and seek to convince/persuade if you wanted to trigger major organizational change. Would you approach the sales rep or the call-center agent or would you approach one or more people in the C-suite?
Second, there is my 20+ years of experience with organizational change and business performance improvement in its many disguises. Yes, the Middle managers and Frontline employees have some capacity to resist/impede change initiated by the Top Executives. What is missed is that they rarely have the capacity to initiate major organizational change nor to bring it to an end abruptly. This capacity, this power, lies with the Top Executives.
Never underestimate the Top Executives addiction to control and the fear of losing it!
Allow me to share a real life example with you. This is the story of a weight loss company and its efforts to shift toward customer-centricity.
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.
Initially, Corporate Executives didn’t pay much attention to this situation. 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. Soon they discovered thru extensive customer research, as well as franchise research among their 4,500 sales consultants, that the hard-sell style did indeed cause customers to rebel at some point and thru word of mouth created a perception that the company was insensitive, pushy and only out for money.
The executives engaged sales and marketing consultants and totally revamped the sales approach, and, most of all, its relationship to its customer. The company changed its value proposition; and 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 people 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 sales pitch perfect.
The new customer-focused process reduced the control of the corporate headquarters and increased control for the sales agents to manage the “customer experience”. Corporate Executives 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 Executives were unable to ensure that everyone followed the same process. Therefore, they 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 favored the scripted, controlled interaction with customers and reinstated the old approach to selling. During the process, the president was hell-bent on reinforcing their own way of doing business, dominating the customer and the sales organization, and being in total control. The hard sell returned and the customers left… soon the business went belly up.
After they went out of business, a few of the executives realized they had authored their own demise. Their insecurities kicked in, the fear of losing control returned, and they went back to their old methods. 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 organizations are faced with change, fear often causes them freeze and hold on to the current way of doing things, even if it’s 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.
Next week, we will take a detailed look at some insights to building a Customer-Centric Organization.