NickB

Most strategies don’t work! Here’s how to have one that does

Most organisations have a strategy, and many devote some of the best and smartest brains in the organisation to developing and implementing it. Almost all of this falls short in some way or other. So, is strategy failing to deliver?

In their new book “Beyond Default: Setting Your Organization on a Trajectory to an Improved Future” change strategists David Trafford and Peter Boggis pinpoint what’s wrong with most business strategies: the failure to realise what trajectory you are on – and why – and where it’s taking you.

I had the pleasure of working with both David and Peter when we were all at CSC Index, the consultancy that gave birth to business reengineering, back in the 1990s.

I recently caught up with David and asked him some questions about the compelling and practical ideas the book contains.

NB: The idea of an organisation being on a trajectory is a compelling one, but I’ve not seen it articulated in this way before. Has anyone else defined strategy in a similar way before?

DT: Not that we’re aware of. The thinking emerged over many years of consulting to and advising companies and it really accelerated over the last eight years since we set up our own company (Formicio). We kept hearing language like “This organisation is hard-wired, it will never change” and CEOs would say the organisation won’t change or people tell me what they think I want to hear but nothing changes. And when you talked to non-execs they would say we need a change of direction – but the only lever they’ve got is to change the CEO. Companies were spending millions of pounds on transformation programmes, but they weren’t delivering. We figured something more fundamental must be going on.

As we thought about it we started to use the term “default future”, we were then approached by a publisher who had seen some of the ideas on our website and thought they would make a good book. When we suggested a title for it, which was too long and complicated, the publisher suggested it was really about taking organisations beyond their default, hence the title of the book.

Then we started to use the term trajectory rather than “path” and the more we worked on it, the clearer it became. In 2016 we concluded that our default future was that the book wouldn’t get finished if we just continued to talk about it. So we sat down to write it: once we’d articulated the default future it became easier to take action to change our own trajectory.

NB: The idea of a trajectory makes sense to me because anything you plan to do is a bit like shooting an arrow long distance, you have to set it off on a path and hope it gets somewhere near the target.

DT: When we launched the book an old colleague of mine – who’s an engineer by training – asked why we were using the term trajectory. He didn’t get it initially but then after a while he came back to me and said it’s like crossing a river – if you want to get to the other side, you have to take the current into account.

NB: The first half of the book makes for tough reading if you’ve spent part of your career working on strategy as it sounds like we’ve been wasting our time defining things that can’t be implemented! Is it the strategy that’s wrong – not taking account of those internal and external forces? Or just poor execution? Or are people just over-optimistic about the chances of success?

DT: All of these things: When CEOs think of the future, they think of the future they want to have, not the one that they’re going to get, so they falsely assume they can change the trajectory of the organisation and also that they’ve got more power to change it than they really have. So they say “We’re going to become X”, but don’t articulate X very well. Often there’s a small group involved in developing the strategy but that doesn’t mean everyone outside that group understands it. Very often strategy is poorly communicated or is based on false assumptions.

I’ve seen many strategies but often I just don’t get it. I find myself thinking, is it so sophisticated that a simple person like me doesn’t get it or is it just nonsense? I usually then ask: “help me to understand how by doing this you achieve that?” This simple question often triggers a rethink.

So, there are three things that are often wrong: 1) a false assumption that you can get the future you want, 2) it’s poorly articulated and 3) it’s poorly executed

NB: Particularly if it involves IT?

Absolutely! Take customer experience: it’s easy to say: “we’re going to give our customers a compelling digital experience”, but you have to consider your legacy infrastructure. It doesn’t mean to say you can’t start doing it but it’s more of a directional thing than an end state – you need to be cognisant of the limitations. A number of digital transformations have started but then failed. People underestimate the money and effort required to re-platform.

NB: And often the solution is just to put more and more effort into building that platform…

DT: It’s a false assumption that organisations are capable of delivering digital. One Insurance CEO we spoke to realised that their IT capabilities were wrong so went externally (to Silicon Roundabout – London’s digital agency hub) and brought it in. Another CEO in a different sector bought a pureplay digital company – then had the challenge not to destroy its successful culture.

NB: Is there an optimum size or shape where it’s easier to articulate the default and desired futures? Some businesses are complicated so there will be lots of different trajectories?

DT: It’s a combination of size, complexity and legacy thinking. The optimum size is where it’s perceivable by the CEO – i.e. it can be retained it in the head all at the same time. For example, a mobile digital bank is fairly straightforward, but for a global bank with many lines of business in different geographies, you can’t easily do that. The divisions can but then the challenge is to align the different trajectories.

What I see is the CEO delegating accountability to the divisions and this translates into individual strategies but with no overarching trajectory or synergies. So, a new group CEO can say the focus is on delivering end to end digital CX, but legacy thinking leads to doing things in the same way. When the overarching strategic intent is translated into the divisions, something gets lost along the way, for example, how does the US division align with international? Executives do different things according to their accountabilities and incentives. Silo organisations are, in themselves, a powerful navigating force that keeps the organisation on a certain trajectory.

NB: Silos will always exist though and – as articulated in your book and through our own experience – operating principles can be a powerful tool to help link across the silos.

Absolutely right – operating principles are a powerful way of making strategy meaningful to those people who were not engaged in developing the strategy. When we articulate principles we’re effectively saying do it this way not that way – a principle always implies a conscious choice.

Many organisations confuse principles and policies – but if you articulate principles there are implications, and this is what needs to be managed. You can’t just declare them, you have to manage the implications (which in turn will shape your policies and procedures).

You can then translate operating principles into design principles for different facets of the organisation, for example IT systems, processes and organisational structure.  These in turn will have implications that need to be managed. It requires joined-up thinking, which actually is quite rare.

NB: So you’re making conscious choices about the culture you want to create – but I didn’t spot the word ‘culture’ anywhere in the book. Was this a conscious choice?

DT: Yes, we intended deliberately not to use it and chose instead to focus on ‘organisational capabilities’. In addition, I don’t think you’ll spot the word vision in there either – or mission.

NB: These are all terms that are well-used, and that people understand, but I’ve started to use “purpose” as this has a greater simplicity. This also connects to your personal purpose as you state at the end of the book.

I like the example of purpose. We didn’t use the language of vision or mission as they are based on a false assumption: it assumes we live in a static world. And it assumes that we can define a change programme to take us to our vision. But we live in a volatile and uncertain world, and by the time you get to your vision, you find you need to be somewhere else because the context has changed.

What we say in the book is that the future exists but it’s not evenly distributed. You have to be cognisant of the exogenous navigating forces that are continually changing your context and the strategic trajectories you could pursue.

NB: You did pick up on one well-used term: Operating Model – but in my experience it’s used differently and less powerfully that you intend.

You’re absolutely right: it’s a powerful idea that has been hijacked and corrupted. It has to be consciously designed and it’s multifaceted (processes, IT, organisation, roles and culture). Very often it looks like the organisation has been designed by accident!

NB: The other powerful idea is that of a “strategic signature” which I would simplify as “taking all the things that we’re doing and varying them”

DT: About three years ago we were working with company and the CEO and Board were having difficulty becoming aligned around the strategy. We helped them identified their different strategic axes – which represent their sources of value – and then facilitated a process where they decided if they were going to introduce new strategic axes or drop some existing ones.  They then decided where they where are you going to operate on each strategic axis.

And the resulting “signature” is unique, even between different players in the same industry, and when you identify current and future signatures this leads to a meaningful conversation about where you can “increase the volume” on some axes and turn it down on others. It’s a very simple tool that creates a meaningful dialogue and alignment of understanding.

NB: Can you cite organisations that have embraced this approach wholeheartedly?

It’s difficult to find one that’s done everything in the book and also some of our client examples are confidential, so we can’t quote them directly. What we’ve done is to cite organisations that are in the public domain who show evidence of doing, or have done, what we’re talking about – even if they don’t know it.

For example, that’s why we used Blockbuster, it’s well cited by anyone who can remember them. Nokia also follows the thinking exactly. And with GE, we talk about their strategic focus shifting to industrial products and the industrial internet and moving away from financial services. However, the cost of changing their trajectory is proving to be higher than they would have liked due to liabilities they retained when the divested their insurance businesses.

NB: What’s your advice to someone who’s not a CEO – how can they get started?

DT: Start by using the language.  I’ll give you an example: my son, who works in a large multinational organisation has been using the language of default future for some time and about a year ago he was in a meeting with his boss’s boss and other some senior people when his boss’s boss started to use the terms default future and trajectory to describe their strategy.  It’s now becoming more commonly used across the organisation. More recently he’s introduced the language of operating principles, so I would say just start using those ideas in conversations in your business.

More information on David and Peter’s book Beyond Default can be found at www.beyond-default.com

NickB

It’s no joke: discourtesy hurts your business

Picture the scene. An 85-year-old woman walks into a pub on the outskirts of Chippenham, Wiltshire to check on a lunch booking she’d made to celebrate her husband’s 92nd birthday. His hearing isn’t so good these days and, knowing the pub can be noisy when busy, she asked if the party of seven could be seated at a quiet table.

“Oh, I don’t know, we may be busy, we can’t guarantee it”, said the manager.

My mother-in-law – for that’s who it was – reiterated the need for a quiet table to make sure the occasion went off successfully.

“Well, maybe this isn’t the pub for you”, said the manager.

At which point my mother-in-law cancelled the booking and re-booked at another, quieter venue.

There are two ways to interpret this:

1) This pub has a laser-like focus on its clientele and doesn’t need to pander to the whims of someone who’s not in its target market

Or

2) THIS IS AN OUTRAGEOUS WAY TO TREAT A CUSTOMER.

I subscribe to the latter point of view, not just because it’s my in-laws, but because it was frankly discourteous and, since I’ve had many fine lunches at the pub with them, I know it’s possible to cater for someone with not-particularly-special needs.

All the more disappointing as their wait staff are normally very good and the food is great.

So, here’s the lesson from this little scene:

  • Customer experience doesn’t just cover the main event (the meal), it’s the whole journey from reservation through to departure from the venue.
  • All points in the journey provide an opportunity for failure.
  • If your front-line staff can’t treat people with respect and make accommodations for their needs, they will lose you money.
  • Excluding one group of customers has a knock-on effect: none of the party of seven – most of who are younger – will be inclined to go there in future.

Courtesy costs nothing.

Discourtesy will hurt your bottom line.

NickB

The missed opportunity in complaints handling that might save your marriage!

Complaint handling departments mostly miss the opportunity to turn a dissatisfied customer into a raving fan.

I recently talked about how critical it is to detect and, if possible, avert complaints before they even happen. If a complaint does occur, it is so important to make sure it is easy for the customer to provide as much feedback as they want – ideally in the form they want. Once you have received the feedback you have a critical and short time period to not only resolve, but create a raving fan.

Be careful, time is very sensitive in these situations. Any perception of slowness can quickly make a situation considerably worse. Dealing with the complaint effectively – and simultaneously creating a significant jump in loyalty – needs a new and more innovative approach.

Understanding the“hierarchy of needs”

I’ve noticed that complaints are something that most organisations avoid like the plague! No-one wants to admit to making mistakes –all too often the attitude is to deal only with the specifics of the complaint, throw some money or gift at the customer as compensation and then move straight on to the next one. Timescales are often set by a regulator, which leads to incorrect priorities and dysfunctional behaviour.

This is about as far away from customer-centric as it’s possible to get and ignores what I call the Complainer’s Hierarchy of Needs. This is  different from the Hierarchy of Needs developed by Abraham Maslow – except that it also has five levels:

1) Hear me. I want someone to be able to listen, understand and resonate with my complaint. I don’t need an argument, I don’t want excuses and I certainly don’t want shallow apologies with no real action. Ask me questions, but only if it helps unpack the full story.

2) Acknowledge my pain. I wouldn’t be contacting you unless I had suffered in some way. It may be minor, it may be a “first world problem” but you’ve fallen short and I’m upset. Don’t overdo it but please show some genuine empathy.

3) Sort it out.At an absolute minimum, I want to be put back in the state I was in before you screwed up and I’d like some form of compensation for my inconvenience. I also want it quickly – preferably almost immediately.

4) Satisfy me. Remember I was a pretty big fan of your company before this and I’d like to believe this is a one-off and get back to those happy times when you delighted me on a regular basis. Now, what have you got? I’m not talking about a box of chocolates – I’m talking about an outcome that has value to me – assuming you understand me well enough.

5) Delight me and keep me loyal. Give me a reason to stay with you – what’s our future together going to look like? If the value is perceived to be there I will invest a bit of time asking your questions but make sure the outcome is a great reason to stay.

The best part of breaking up

And if that sounds like getting back after a bust-up with your significant other then it’s supposed to be – yes, it’s that serious! Bad significant other experiences have resulted in divorce rates at46% in the US. Interestingly, according to data from NewVoiceMedia, 44% of US consumers switch to a competitor following a poor customer service experience.Like disenchanted marriage partners, customers will exercise that level of rebellion if they don’t get what they think they need.

People in a failing marriage often cite a lack of empathy as a key reason driving the split. Customer rebellion is driven by exactly the same issue. We simply don’t recognise the complainer’s hierarchy of needs sufficiently. We extrapolate that to a belief the company does not care, and our reaction is heightened as a result. In fact, as far as complaints handling goes, we only recognise part of it, getting as far as sorting out the problem and providing what the company views as appropriate compensation without sufficiently understanding the customer’s desired outcome.

The Missed Opportunity

Aligning the customer hierarchy to the what the company does in response is fundamental:

1) Listen. Provide a channel that “works for the customer” – which often means giving choice. Technology is now more widely available and relatively cheap as an enabler. Behind that enabler should be a non-judgemental, open and sympathetic “listener” for the complainer. If you receive the complaint in writing, responding quickly with follow up is key. Customers will react much more favourably to a personal conversation, so call them back within two hours of receiving the complaint.

2) Empathise.This bit is almost obvious to state but much harder to deliver. Empathy is acknowledging that whatever happened was in some way unpleasant or inconvenient for the customer and showing the customer you genuinely care. This is not as easy as it seems. Some customers want only a “leave it with me, give me ten minutes and I will sort it” style response whereas others want more time to air their views even if that is simply to “blow off steam”. Of course, some people are more naturally empathic than others, but it can be taught and if sufficiently practised, internalised into everyday handling that is repeatedly exceptional. Make sure it’s on your training programme for all.

3) Empower people to act – rapidly. It’s too easy to hide behind processes, procedures and rules. Too much “guidance” is in place because an organisation doesn’t trust its staff sufficiently to do the right thing. Having to check or refer upwards again and again, wastes time, reduces productivity, andmotivation, and further infuriates an already-angry customer. The key here is empowerment and flexibility to allow the agent to do what is right. Post hoc checks and regular reviews are a much better way to make sure that staff are doing “the right things” instead of “doing things right”. There is a big difference!

4) Make sure your customers are satisfied. The emphasis is on the word “your”. If you think of the customer as “your customer” rather than the company’s customers, then that is a subtle but significant first step.Very often customers are happy just to have the mistake corrected or a refund provided but equally often we don’t think of asking how the experience of complaining was for the customer and, more importantly, how they feel about the outcome at a detailed level. The investment required to find this out is minimal yet it’s a practical demonstration that you weren’t just following a process, you had flexibility and you really care.

5) Understand the customer’s desired outcome and take it up a level to delight them. Having got a satisfied customer, you need to enhance the relationship and take it to a level beyond what it was before. The single most critical success factor to achieving delight is to understand what their desired outcomeis and deliver it better than the competition. And the key to this lies not only in your feedback and handling on the specifics driving the complaint. The key is to drive a deeper understanding of the outcomes and related experiences that are most important to the customer and creating an environment to deliver against it. At a basic level, reversing their negative feedback – specifically the things they couldn’t do as a result of your screw-up – gives you the starting point for understanding their desired outcomes at a deeper level, aligning your products, services and supporting processes to make it happen. This might sound expensive but the loyalty and revenue uplift that this can bring will make it an immensely profitable and rewarding exercise.

You read it here:applying this approach can make customer complaints into a revenue generator and there’s a case for treating it a profit centre. That’s slightly different to the norm don’t you think?

In the next part of this series we’ll “close the loop” on complaints by making sure that you genuinely learn from your mistakes and build a better understanding of your customers’ desired outcome

NickB

Here’s to The Next Ten Years

Personally I hate it when you click on a site and find it’s not been updated for a while. If you’re like me then I apologise, but if you are in search of material on Customer Experience, innovation and change in all its forms, please go to The Next Ten Years where you’ll find all my up-to-date posts and contributions on related topics from a growing band of contributors.

See you there!

NickB

Closing the loop: the vital missing component in complaints handling

You need a strategic approach to managing complaints that focuses on customer outcomes as much as what went wrong.

I recently described complaints as being an under-exploited goldmine of customer feedback. Companies need to widen their focus from purely complaints i.e. dealing with the “expression of dissatisfaction” to a more strategic approach that I refer to as “closing the loop”. This means joining up the three main parts of complaint management into a coherent programme that’s focused on change and improvement in the quality of overall customer outcomes as much as customer satisfaction in relation to the original issue.

Why is this important?

According to market researcher Pierre-Nicolas Schwab, in a 2015 article, the data shows that complaints from customers are not taken that seriously or are ignored.

  • More than 50% of companies don’t answer complaints
  • In 2013, post-complaint satisfaction was still at 1976 levels (RAGE survey 2013)

And, looking at the latest US RAGE survey, $313bn are at risk because of dissatisfaction in the US alone.

It’s time to get strategic.

It’s time to close the loop.

Opportunity

It’s rare that companies adopt this approach – or if they do it’s underpowered – and – as the statistics above show – it represents a great opportunity to create differentiating customer value. The underlying components are simple to describe:

  • Detection – identifying the complaint or the potential complaint and averting it if possible.
  • Handling – dealing with the complaint when made and restoring the customer back to the state they were in before the error occurred
  • Learning – identifying what went wrong at the “root cause” level in relation to either stated or expected customer outcomes and then taking action to:
    – prevent future occurrences
    – identify the potential contribution to the wider outcome-driven operating landscape.

This last part will be different from traditional best practice, but the complaint interaction creates a fantastic opportunity not only to repair the issue but create a level of loyalty – and therefore business impact–over and above what could have been achieved if the complaint had never happened.

In other words, customer complaints can be used as the basis for customer innovation – and in my experience very few organisations are currently doing this.

Detect and survive

Going back to basics. The front end of complaint handling takes place before a complaint is made and, at best, avoids the complaint being made at all. This requires the ability in each contact channel to detect imminent dissatisfaction and take action to deal with it.

Different channels will require different skills to carry out this, for example:

  • Face-to-face channels require staff who can pick up on the visual cues that a customer is potentially irritated.
  • Similarly, an experienced agent in a call centre should be able to detect from a customer’s tone of voice that they are unhappy.

In both these cases situational training and role play can help build competence since not all of your staff will be naturally empathic.

In the digital world we have not yet reached a point where machines can match an experienced front-of-house manager or call centre agent for empathy but there are various ways it can be simulated. It’s possible to detect if a customer’s online journey is particularly slow and then to prompt with help and support messages. Similarly, the availability of an online chat button means that customers can divert to a human (or chatbot) for support rather than getting frustrated with an online experience that’s not working for them.

But online doesn’t just mean websites: social media are increasingly an opportunity –in some cases the preferred channel – for customers to vent their dissatisfaction. Early detection here is crucial given the propensity for some grievances to go viral. It pays to have a light touch when dealing with these – as UK retailer Argos did in a “street speak” exchange with a disgruntled would-be PS4 purchaser back in 2014: the amplification performed by the Twitterati performs a handy bit of brand enhancement.

Dough balls

This front-end detection isn’t always possible however as the customer may be complaining about something long after that initial first point of contact so it’s vital that the customer can raise a complaint easily. In fact, complaint and feedback should invariably be encouraged.

Sometimes you can go to a company’s website and immediately find out how to provide feedback – I recently raised a complaint with UK bank TSB and could find it within a couple of clicks (the eventual resolution wasn’t great but that’s another story) and everyone’s favourite First Direct is similarly easy – but other businesses are a bit more coy, relegating complaints to a more obscure area – in the case of NatWest’s personal banking site for example it’s hidden in the Support Centre which, to me at least is less than blindingly obvious.

This attitude suggests that some businesses don’t welcome complaints or any kind of feedback, which is nuts, since finding out what customers think of you is, you know, quite a good idea.

But people don’t actually like complaining (unless they’re a CX-obsessive like me, but even I can get worn out by the sheer tedium of it) so it pays to make it easy or to incentivise through competitions – entering a prize draw – or vouchers (Pizza Express’s How Did We Dough? for example). Personally, I think the instant gratification of a low-value item is better than the chance of a prize, since it says that the business values your opinion – but maybe I just like dough balls.

Radar

Getting your “complaints radar” working on all channels is key to minimising the actual complaints you have to deal with. They may be a great source of feedback, but once a complaint is made it’s costly to process and provide redress so early intervention is always preferable.

In the next part of this series we’ll go on to consider how to handle the complaint effectively when it is made and how focusing on the customer’s intended outcome will help deliver a resolution and an enhanced overall experience that can change a detractor into a raving fan.

 

 

 

NickB

In search of a magic number? Try 150

Bear this number in mind when aligning your organisation around the customer.

It’s become more than a cliché but people (including me) are still writing articles with a compelling number in the headline as these are thought to get people clicking more avidly than a title without. (I suppose Paul Simon’s hit “50 Ways to Leave Your Lover” would have had less impact if it had been titled “How to Leave Your Lover”, or “Leaving Your Lover: Some Thoughts”.)

This week I’ve been attracted to the number 150, and you should be too, as it gives organisation designers a useful rule of thumb on the effective size of an organisational unit.

The origin of this thought came from looking at the website of AND Digital. This innovative and rapidly-growing digital development business is organised into a number of Squads – small teams with a mix of developers and analysts covering a range of experience and six of these Squads make up autonomous Clubs, each of which has its own club house and a total focus on its own people and clients.

Club size is limited to 100 people and this chimed with me as, despite working in organisations of over 100,000 employees I have always felt more involved with a much smaller unit. And it also reminded me of a book I had read – “Managing the Human Animal” by London Business School professor Nigel Nicholson – which identifies 150 as the maximum number of members of a kinship group.

150 ways…

Turns out this number is no accident but an outcome of our evolution as a species. Nicholson’s book is concerned with evolutionary psychology – and specifically how our modern society and the way it is organised does not pay enough attention to the slower evolutionary pace of our brains’ development.

The number of 150 was arrived at by psychologist Robin Dunbar, who looked at the size of the neocortex – crudely put, the bit of our brain that makes us human – and the size of primate communities. He found that, for humans, 150 is the maximum size of the community that our brains can navigate. As Nicholson points out, our evolution as semi-nomadic kinship groups meant that our brains developed to cope with this optimum size – any larger and the group was too large to support itself, and if too small it could not generate enough resource.

What has this to do with supercompany performance?

In the case of AND Digital this was a conscious design choice based on the Rule of 150 and their current recruitment drive suggests a high rate of growth. But I’m not going to suggest that copying their model exactly would be right for everyone or that doing so would automatically create higher levels of performance.

Make a new plan, Stan

Companies that want to become more customer-centric certainly will have to create a new design for their organisations. Sadly, many do not and paste customer experience on top of what they already do – hence the lack of impact for many. I was pleased to hear that one major UK bank has recently moved its 15,000 IT and change staff into 15 integrated teams organised around key colleague or customer journeys. This is an excellent start point but the effectiveness of such an organisation will be in the ability to make each unit of (presumably) 1,000 people – a tribe in Nicholson and Dunbar’s work – work effectively across smaller groups.

Making sure such redesigns – and the processes that support them – go with the grain of human evolution rather than against it is a subtle and sophisticated art. But as a guideline, bearing the number 150 in mind is not a bad start.

(Thanks to AND Digital advisory board member Mark Zawacki for sowing the seed of this piece in my mind.)

 

NickB

Forget Chief Customer Officer, welcome to the new “COO”

There’s a problem with the Chief Customer Officer role and rethinking it as the “Chief Outcome Officer” (COO) can help everyone get on board a customer-centric company.

Although not yet present in every organisation, the idea of a Chief Customer Officer is beginning to take hold, with an increasing number of organisations making the appointment.

But in my view, there’s a problem.

When you appoint a chief anything officer you expect them to be the ultimate solver of the problems in their area. This is OK when you’re in charge of, say, operations or sales: most people would expect the Chief Operating Officer or Chief Financial Officer to be the ultimate go-to person in when something needs addressing in those areas.

But customers? Is that sales, marketing, your contact centre or billing. Do those functions report to the Chief Customer Officer now?

No, they don’t. Which makes the term Chief Customer Officer a misnomer in many organisations. They have influence over those traditional functions for sure but not really the authority. It’s frustrating for the individual and his/her team because they can see the opportunity but all too often without the ability to create meaningful change. It also goes someway to explaining why the Chief Customer Officer has an average tenure that is on average the shortest in the C-suite.

Eagle eye

As one of our NextTen Inner Circle members pointed out in an email recently, the holder of such a role has a focus that involves “hovering around like an eagle” with nothing escaping their sight. This is spot-on: customer issues are all-pervasive so in some sense we need an all-pervasive role or someone with a roving brief who can pounce on and sort out issues wherever they occur.

That may be fine in some organisations but in most it can lead to a role that’s undefined or underpowered or, even worse, where all the other functions think the customer is “someone else’s problem”.

The Chief Outcome Officer has a different focus. By moving attention from “customer experience” to customer outcomes, organisations can get a view of the value each part of the organisation creates for the customer. It is also a strong catalyst to move departmental focus from being excellent at “what they do” to creating excellent “outcomes” – because that’s the ultimate measure the customer makes when they make a choice to buy or not.

But there’s an even more important distinction: the new COO isn’t one person’s role,

it’s everyone’s job

Really?

Yes, in a genuinely customer-centric organisation, every role must have something to do with creating a positive outcome for the customer. Even when a role isn’t customer-facing, the role-holder should be able to have some line of sight to the customer and the outcomes they are contributing towards.

So how does this idea work out in practice and how do you embed this kind of thinking into the organisation?

My customer, your customer

The first thing a Chief Customer Officer can do is map the traditional organisational structure to a outcome driven structure. This is just another representation of how a company is structured but if the overall superior customer outcome is both the goal the customer seeks and the no 1 strategic differentiator, then surely this is a critical representation than companies need which defines how they operate.

This viewpoint will certainly excite the CEO and the strategists but how do you ensure it becomes everybody’s job?

The best way to create this momentum for change is through a programme of “employee engagement”, although personally I don’t care for that term as it suggests that you’ve already failed to get your people engaged. Leaving that aside, it is possible to use a programme to move the organisation towards an all-pervading awareness of customer outcomes.

I was involved in such a programme when I worked at BT. The MyCustomer programme was a multi-faceted affair that ran for a few years and, as the title implied, was intended to create a much greater sense of ownership of the customer throughout the organisation. It included various events including competitions (I’m pleased to say that the solution I sponsored is still in use today) and “back to the floor” exercises, but one of the most inventive was the creation of an employee-only help desk for dealing with customer problems.

This addressed the problem that I and, no doubt, many of my colleagues experienced when someone you met asked you what you did and, when you answered that you worked for BT, would launch into a diatribe about the level of service they had received. Using an internal helpdesk made it easier to offer to take ownership of the problem there and then. The unforeseen consequence may have been that people would avoid saying who they worked for, and I have no data on how many queries the helpdesk handled and from which parts of the organisation, but the emphasis was very much on everyone in the organisation having an impact on the customer.

It was such a good idea that I wish I’d thought of it.

Mind your language

But programmes come and go, and the number of conversations I still have about BT with friends and strangers suggests that they should have kept the MyCustomer programme running for longer to embed it firmly into culture and processes. This is the million-dollar question of course: how can you embed customer-centric behaviour and attitudes across the whole organisation after the programme circus has left town or even avoid the need for a change programme altogether?

The key for me is the way that leaders at all levels talk about their work and the things that they emphasise when they talk. Many years ago, I talked to an organisation who, according to their publicity, would bring to a halt any meeting that had not discussed customers in the first 15 minutes. I was applying for a job with them and never got to find out if it was true or not, but even if only partly true, it was a great story about where the customer figured in their priorities.

Of course, it’s entirely possible that you might need a real Chief Customer/Outcome Officer to set the tone and change the conversation but ultimately in a real customer-centric organisation the customer must belong to everyone.

NickB

Are you an “accidental entrepreneur”? Time to cut the BS!

Entrepreneur.

The word has a certain mystique, possibly because of its French origins – a combination of entreprendre, meaning to undertake, and enterprise – and possibly because of what it means to some people. To some this creates a vision of successful business magnates, tycoons or other captain-of-industry types. To others it could be that one or two-man company, working all the hours to make a buck.

To me, entrepreneurship is something much more widespread than the larger than life, hard-nosed “go-getters” you seem to achieve self-parody on TV shows such as Dragons’ Den or The Apprentice.

In fact, you may be an entrepreneur without realising it – I refer to this as “accidental entrepreneurship” – and if, like me, you are, it’s time to cut the BS and get on with your job because the most vital commodity in your treasure chest is time – and you don’t have much of it to waste!

Parental advice I should have ignored

Sticking with the reality-TV theme let me risk boring you with my “journey” to entrepreneurship. It started badly. In fact, it took me 30 years to get over my father’s advice to never work for myself – he’d been a hotelier and restaurateur all his life and had never seemed particularly happy with it and that may have coloured his judgement. It wasn’t until an attractive redundancy package came along that I decided to give up the 9-to-5 (as if!) and embark on what I imagined would be a freewheeling career as a freelance management consultant/interim manager.

As it turned out, the next few self-employed years bore a distinct resemblance to the previous employed years: I was still doing customer-centric change management and strategy work in large organisations, but with a different pay arrangement. Oh, and slightly less stability. Still, not quite the “gig economy” since, luckily, my gigs were measured in months not taxi rides.

But that still did not make me an entrepreneur. Not even the accidental sort.

Expert advice I can’t ignore

Entrepreneurs are defined as people who set up a business or businesses, taking on financial risks in the hope of profit (my emphasis). Entrepreneur Magazine – who should know – emphasise the point further in an article by Steve Tobak. He critically, points out that being an entrepreneur, like being a leader, isn’t so much a job as having an attitude. Traditionally this has been to business aspiration and risk.

But there’s more – a critical factor that differentiates the triers who dip their toe in the water to see if it works, and those who have a higher calling and are committed.

I set up NextTen Innovation Solutions – along with my colleagues – because, having had a life-long obsession with customer experience and service, I was fed up with companies who professed to be customer-focused but weren’t making the changes necessary to be genuinely customer-centric, and short-changing their customers and employees as a result. My hope was that there were enough potential clients out there who’d like to exchange money for our services and that we can build a dynamic, thriving and profitable business, that practices what it preaches as a result.

So those four words in bold tick some boxes for me but the entrepreneurial penny really dropped when I read a blog post by the ever-savvy Seth Godin where he defined people “acting like an entrepreneur when:

  1. They make decisions.
  2. They invest in activities and assets that aren’t a sure thing.
  3. They persuade others to support a mission with a non-guaranteed outcome.
  4. This one is the most amorphous, the most difficult to pin down and thus the juiciest: They embrace (instead of run from) the work of doing things that might not work.”

When I read this a few weeks back I realised I was now definitely an entrepreneur, not just someone who was self-employed. I also appreciated that big business badly needed more of these types of people as well. Entrepreneurial thinking is not just for those aspiring to build their own business, it is critical to companies that need to become ever more responsive and agile as the implications of the customer age become more stongly felt. We’ll continue to expand this theme in the coming weeks.

Avoid accidents

“Being an entrepreneur” isn’t, as Steve Tobak points out in another article, a job in the same way as being a “being self-employed” isn’t a job. So, when people ask me what I do I don’t tell them I’m an entrepreneur or that I just woke up this morning and realised I was an entrepreneur, I usually say I’m building a business since this is the shortest way of describing a job that is multi-faceted, never-ending, and full of more emotional ups and downs than any of my previous jobs, employed or otherwise.

“Accidental entrepreneurship” is definitely not something for the faint-hearted, and if, like me, you wake up one morning realising that you are “acting like an entrepreneur” you need to check that you are comfortable with the level of risk involved in investing in whatever venture you’re working on and the ambitions it has in terms of profit.

If that’s something that excites you – great – just don’t waste time worrying about the implications of entrepreneurship. Just cut the procrastination and BS. Go for it and get on with your job!

NickB

Harnessing the power of purpose

Vision. Focus. Mission. Drive.

All words we often use to describe the qualities we associate with high performing companies or the people who lead them.

But if I had to pick the one quality that propels an organisation into genuinely high performance, it would be purpose. It encapsulates all the above terms and taps into a deeper motivation to “do the right thing”, whatever that might be.

But what is an organisation’s purpose? Recent conversations and news items – such as the statement by asset manager BlackRock’s Larry Fink that they would only invest in companies that contribute to society and deliver financial performance or risk losing their support, suggests that there is an awareness amongst the most numerically-obsessed that performance means much more than profit, ROCE, or other financial measures.

But it’s not easy.

Louche

Bar Italia in London’s Soho is more associated – in my mind at least – with the kind of louche nightlife portrayed in Pulp’s eponymous song – “…I’m fading fast/And it’s nearly dawn…” – than inspiring conversations about purpose, but I recently found myself having such a conversation at the more civilised hour of 11am with Gemma Cropper, MD of social impact consultancy Skating Panda.

I’ve observed and worked with organisations that have a clear purpose and those that have lost it somewhere along the way. In talking to Gemma, it was clear that social purpose is increasingly an area that organisations are interested in as they seek to improve the engagement of both their customers and employees. Often it can be driven by customers: for example, clothing manufacturer Nike had to completely change their supply chain after accusations of sweatshop conditions in some of their suppliers.

Employees will often drive the change and are after something more than a bit of “corporate social responsibility” which, however valid, can look like window dressing for an otherwise unattractive brand.

And with the developments in AI and robotics becoming a threat to jobs in all organisations in the coming years, employees will want to see a clear sense of social purpose in all major change programmes.

It can take years to bed an organisation’s purpose in – those looking for a quick fix will be likely to be disappointed – and if the CEO is only focused on the share price, the chances of success are minimal.

Tacked on

It’s a point echoed by organisational change consultant Belden Menkus in a recent paper where he points out the danger, when trying to re-discover an organisational purpose to differentiate itself from competitors, of it being reduced to a strapline or a shallow communications exercise.

In these cases, a wider social purpose can seem tacked on to an organisation or, even worse, a compliance box to be ticked.

Don’t confuse focus with purpose

What can organisations do to create or recreate a meaning that’s wider than a healthy balance sheet?

The first step is to make sure you’re not confusing purpose with focus. Having a focus on efficiency, sales growth, time-to-market or any other key performance indicator is essential in any high-performing company. Whatever is important to your performance needs to be a focus area for some or all of the people, some or all of the time.

But it’s not the same as purpose. Purpose is what gets you out of bed in the morning and makes you feel good about what you did at the end of the day. And although you may feel awesome about a day in which you shaved 3% off production costs or landed a million-pound sales deal, a life in which that’s all you can see may end up being less rich than it could be.

Understand outcomes

Often an organisation’s social purpose is a direct consequence of its operating model. As a pioneer of low-cost flights, SouthWest Airlines enabled people to connect more easily across a wide geography – the social benefit is easy to see as well as being attractive for customers.

So, an organisation’s purpose primarily needs to grow from an understanding of the outcomes it creates for its customers. And this involves thinking outside the immediate products and services it offers.

I’m privileged to work with a local music education charity – more on that another time – that offers great music lessons in the locality. In that regard, it’s no different from other purveyors of music education but what sets it apart is its purpose to offer a high-quality, rounded and multi-faceted music education to children and young people who otherwise would not have that opportunity. That purpose has propelled it from tiny beginnings to exciting developments that will increase its reach and impact.

The challenge for the charity will be to keep that constancy of purpose as it grows in the coming years.

Just start

Although there is the strong possibility that you may discover that your organisation does exist solely to make a shed-load of money for its directors and shareholders you shouldn’t – as Belden Menkus points out – wait for a directive from above. Start in your team to find out what it is that people feel passionate about in relation to the outcomes of the work you do.

And when you’ve found it, tell others. They might just share the same passion.

NickB

Customer service basics can make all the difference (part 2)

In the first part of this two-part article I dealt with some examples of keeping the customer informed and managing their expectations. There’s a common theme emerging in both those and the following examples of basic customer service – and my experiences over the post-Christmas period emphasised this:

Communication is everything

Here’s the remaining four of my six basics…

3) Don’t hassle the customer

My in-store experience at Warren Evans was a classic example of getting the level of attention just right. We were greeted by an assistant, Michelle, who determined our needs, then showed us the range of potential beds. She then left us to get on with working out which one we liked and when we’d made our choice, took us through the transaction, including the commitment to dates.

Warren Evans is by no means the only store that can get this right – it’s something every floorwalker in a store should be trained up in and, in my experience, most stores can get it right. However, when stores move online, the ability to judge how much attention a customer needs seems to go out of the window. In part this is understandable since the customer is not visible in the same way as a physical store, but sites often over-compensate by forever pestering you to provide feedback or reminding you that you had the temerity to leave goods in your cart without completing the transaction.

Feedback and nudging customers to complete make good sense commercially but don’t always lead to customer satisfaction. Involving customers actively in the evolution of online services helps you to get these details right.

4) Pay attention to unspoken needs

My most frustrating recent experience came on my birthday at the beginning of January, where I had arranged to meet family at a central London restaurant. It’s a reasonably well-established American-themed venue and seemed just about right for a lively celebration. On arrival it appeared to be too lively as our table was close to the bar area where a singer/guitarist was providing live entertainment for the evening. I did a quick tour of the restaurant looking for a quieter table, at which point the manager spotted what I was doing and immediately moved us to a better table. So far so good, sadly there will be some negatives to come…

5) Deal brilliantly with complaints

…and indeed, the restaurant managed to get so many basics wrong that a 15-point complaint email followed. However, the initial attention to my dissatisfaction with the table was a great example of one element of dealing brilliantly with complaints and that’s dealing with them before they happen.

A further example followed when two aperitifs took 20 minutes to not arrive. On raising this – an expression of dissatisfaction, so a complaint in all but name – we were offered them gratis.

Overall, despite good food and great company there were other basic restaurant service elements that left something to be desired, so I emailed the restaurant at length. I received an email the following day from the manager we had seen who demonstrated the following good practice:

  • Acknowledged the error(s)
  • Apologised
  • Offered compensation, even though none had been requested.

In this case the compensation is four free dinners, which we’ll take up soon, if only to check that the promised improvement in service has been implemented. Sometimes I think it’s a mixed blessing having me as a customer…

6) Don’t be average

Part of the problem with the restaurant was that, whilst Ben the manager was attentive, the other service staff didn’t seem to be on the same page. Certainly, they were not responding to what should be a given at a venue like this: that my desired outcome is a great evening out, not just some reasonable food and drink.

Many retail outfits – particularly in the food and hospitality sector – are content to provide average transactions. I reflected on this when writing the first part of this piece in a nearby outlet of a coffee chain (inexplicably named after a decadent Roman emperor). I ordered my flat white and it was prepared in short order but, whilst the assistant wasn’t in any way unpleasant he wasn’t exactly personable.

I don’t expect hugs or a life-transforming experience when I’m buying a coffee, but I couldn’t help thinking an opportunity had been missed for a bit more human interaction, otherwise I might as well be buying coffee from a vending machine.

First world problems?

Dissecting one’s own experiences like this is an occupational hazard when you’re in my line of business and sometimes it can seem like I am obsessed with what might be termed ‘first world problems’ but the problem for first world businesses is that competitive advantage can be gained from getting all these things right, particularly when so many companies don’t.

Will you seize the opportunity to fix your service basics and get ahead of the competition?