Don’t give customers what they think they want

It is pretty much accepted wisdom these days that companies should be customer focused. It is however unfortunate that most companies go the wrong way about this by asking their customers what they want. Customers describe their requirements in terms of products and services and then when the company builds and delivers they are not desired or bought. Henry Ford put it very well “if we ask customers what they want they’ll ask for faster horses”.

And yet at the end of the first decade of the 21st century a surprising and somewhat alarming majority of companies do precisely that. Why does this fail?

Fundamentally when the customer is asked the question “what do you want from us” the answer comes in terms of product and service. Customers when faced with this question extrapolate from their own experiences and what they know of your products and service. Hence it shouldn’t be any great surprise when the requirements are bounded by current ‘inside out’ thinking. Our organizations then construct complex systems and processes to meet the requirements, develop ‘customer focused’ strategies and seek to demonstrate with measurement systems, scorecards and the like that what they are doing is what the customer asked for. Meanwhile competitors are beating us at our own game.

So how can we resolve this apparent conundrum? The answer is delightfully simple, as are most things involving Successful Customer Outcomes (SCO’s). We should be asking the more relevant question “what is the customers desired outcome?”. This subtlety takes us to a new place of understanding and opens the potential for innovation and the opportunity to challenge our existing business thinking.

Making customers life’s simpler, easier and more successful is a cornerstone of SCO’s. Once we have understood the SCO we should then align everything in our organization to achieve that endeavor – without exception. We can design measurement systems which understand the SCO and the various steps to achieving it. Measuring becomes a simpler task. We should create systems which contribute directly to achieving the SCO. In fact no development should be taking place if there isn’t a demonstrable direct linkage to getting the SCO. In fact everything the company does should be progressively aligned to achieving SCO’s, and not as we often see in delivering faster horses.

How do we create this new order? Again the answer is a simple one and not bounded by the inside-out complexity which befuddles so many companies. Your improvement approaches should also be aligned to creating, understanding, and implementing approaches that, yes, contribute to the SCO.

That’s where Customer Expectation Management (CEM) comes in. As an Advanced form of business process and performance management it goes the extra mile and applies our focus to SCO’s. As a consequence these ‘outside-in’ companies are able to progressively and continually innovate and create clear water between themselves and rivals and in many instances becoming market leaders. That’s what US based Best Buy did with their customer centricity strategy. That’s what FedEx Kinko are doing with their massively simplified idea to delivery process. This is what Virgin Group do across their network of more than 100 companies.

It isn’t always about market leadership though. Simply getting better against a backdrop of increasing competition, technology innovation, tightening regulation and customer promiscuity would be great for most. Going the CEMMethod(tm) route gets you where you want and need to be.

In our 2006 book “Customer Expectation Management – Success without Exception” we reviewed the theory and several case studies which is now accessible as a complete method, with supporting toolkits, resources and techniques. The CEMMethod(tm) can be taught, customized and developed to suit different environments and commercial challenges. In the last 5 years more than 8000 people have qualified as Certified Process Professionals and incorporated this approach into their thinking at all levels – from the board room to the lunch room.

In summary then we should be asking customers what is their successful outcome and once we understand that progressively move to align everything we do to achieving that through our people, process, technology and ultimately strategy.

Good hunting for your Successful Customer Outcomes.

A very old question, a very new Answer

At a recent senior executive seminar we were discussing the theme of Successful Customer Outcomes (SCO) and one question which cut to the quick deserves more after thought. Picture a dark, dingy Victorian meeting room in central London, the sleet slapping against the windows and it is late on a October afternoon.

The bright spot? A series of animated discussions around the usefulness (or not) of IT, the struggle with different process methods and the ongoing challenge of aligning our strategies with SCOs. OK you have the backdrop – here is the question from a COO in a large retail company…

“How can we make sure our people follow through and continually deliver the right thing? So often our initiatives start well and then people take their eye off the ball.” Nods of acknowledgement and congruence and even someone muttering that people just don’t get it, no matter what motivational stuff is tried.

And then a spirited response from a progressive Airline Executive (think geography and go where the birds go in a Northern US Winter) and his suggestion was so simple it was surprising that so few get it. “Well we reward for success. That is the achievement of the SCO and everyone in our company is linked to that goal. And I mean everyone right on down from the CEO to the newest trainee and college recruit.”

It set the room into a frenzy of debate, some folks insisting they do that already, others asking for more detail and some saying tried that and still failed. Airline Executive continued sensing he had something of major interest to contribute, “you see everything you do through the experience and expectation of the customer. I know we have talked about that for years but how often do we follow through, even on things like ‘Voice of the Customer’ in Lean and Six Sigma we paid lip service to the effort to truly understand and articulate everything through the SCO.” He had everyone’s attention now and continued, “Once you get started and have a clear explanation of your SCO ask yourself the question ‘is everything we are doing aligned with achieving this SCO?” – if it isn’t challenge it and ultimately “stop doing the dumb stuff.”

We then had a thirty minute brainstorm of relevant SCOs to realize that at the start there are more than a few, lots in fact. Some apparent SCOs are simply not so. Take the one suggested by a well meaning banker “To deliver credit cards on time within budget.” Initially that creates an illusion of working towards mutual success but on closer examination this one is ‘inside out’ and really doesn’t care too much about the customer. The real SCO revolves around creating the capability for a customer to use their facility in a simple trouble free way. When you think of it ‘outside-in’ that takes you to a whole new place with a set of new answers to some very old questions.

The discussion was in danger of running over time so we all took a way a brief to ‘search and deploy’ our respective SCOs knowing that our first efforts would be iterative and a learning experience.

Our next meeting then focused on helping people align to the SCO and doing as the Airline Executive proposed – rewarding folks for achieving those SCOs.
How would you do that?

The principles above are derived from direct experience and research within world leading companies. Prospective Certified Process Professionals gain full exposure to the techniques, tools and CEMMethod(tm) in the Business Professional programme.

Introduction to Outside-In (Dick Lee)

Presented in Chicago at the
5th Annual Process Excellence Week for the Service & Transactional World

Outside-In. The Change Imperative

By Dick Lee
Principal, High-Yield Methods

Steve Towers
Founder, Vice President, BP Group

Want to watch change in progress? Just look at the turnaround in buyer-seller relations in industrialized nations. Business is having a “Galileo moment.” After assuming for decades customers revolve around companies, guess what? Business is learning its world is round, and companies revolve around customers–at least that’s the rotation for companies planning to stick around a while.

But learning this lesson rarely translates into doing–at least doing enough to become customer-centric. Companies don’t switch to revolving around customers with a memo saying, “Beginning at noon next Monday, we’re going to be nice to customers.” Obviously. But they don’t get there with 1-to-1 marketing strategies, either. Or with sales, marketing and service using CRM software. Or with implementing more customer-friendly service policies. Or with customer analytics. Or with social networking. Or with all the above tactics. No matter what consultants and software salespeople claim.

Moving to a customer-centric business model goes way beyond these incremental changes–and way beyond the comfort levels of many companies. Organizations achieve customer-centricity through transformative change–starting with new beliefs and new cultures, which give rise to new strategies plus new work that converts strategies into actions. And to further the degree of change, new work dominoes change from organizational realignment to redesigned technology support.

Tough to achieve? You betcha. But some companies have already made the transition. In fact, some companies have been customer-centric since formation. They’re the lucky ones. But how did companies having to migrate to customer-centricity get there? There’s one common factor,“Outside-In.” They didn’t call their journey “going Outside-In.” In fact the term only surfaced several years ago, in conjunction with a Virgin Mobile customer-centric initiative. But they’ve all followed the same pattern. Now, more companies are following in their footsteps. And when something new happens frequently enough, spurred by champions “spreading the gospel,” we give it a name (hopefully not a three-letter acronym). Hence “Outside-In.”
So what is it?

Outside-In is the fusion of planning and process design into one, integrated, customer-centric activity.

The planning part redesigns strategies from a thoroughly customer perspective. And by “strategies” I don’t mean marketing, promotion, branding, stuff that advertising agencies do. I’m talking products, services, delivery, in some cases core business direction–all invented or renewed with an adult dose of innovation. It starts with “finding your inner customer,” “seeing through customer eyes,” “standing in customer shoes,” or whatever you want to call it. And results in companies raising the competitive bar, often high enough that others can’t clear it. If, that is, new strategies trigger new work.
That’s the process piece. Defining what work should be done to implement new strategies; who should do it; how it should be done; and ­enabling technology[1]requirements. Some call this “customer-centric infrastructure,” others “customer-optimizing operations,” but it doesn’t matter. Just no TLAs.
Worked together, these two Outside-In elements align strategy to customers; process to strategy; and technology to process–creating the spine of a customer-centric company.

Outside-In creates a framework for designing, organizing and simplifying the migration to customer-centricity–true customer centricity. The type that adds new value to customers as the only reliable means of adding new value to the company. Not that the transition is ever “simple.” But business will have to get there. Because when one player in a sector goes Outside-In, others will have to follow, or risk being left to an unhappy fate.

Just look at what happened to consumer electronics chains in the U.S. once Best Buy went Outside-In. Circuit City and CompUSA might as well have been bugs beneath a work boot. Squish. But that’s the usual fate when a competitor beats you to putting customers in the center of your business circle. Squish.
True, some companies survive by scurrying to change reactively. UPS has stayed profitable while scrambling to match customer-centric moves by FedEx. But how many companies have the strength and resources of UPS?

Despite the probability of facing dire consequences sooner or later, many change-averse companies continue to sit rather than change. As a past client once said to me, “I know we have to change, but we can’t stop doing what got us here.” They circle the wagons to protect themselves from customers fighting to take over the center of their circle. Or, perhaps a better analogy, they engage in a tug-of-war with customers over who controls buyer-seller relationships. Just one problem. There’s an 800 pound gorilla on the customer end of the rope, and she ain’t budging. And just wait until she gets impatient and starts pulling. When she does pull, companies will have to get Outside-In quickly, if they’re not already–or risk going upside-down.

Don’t wait until you’re forced to go Outside-In. Proactive change works so much better than reactive. Twice the gain with half the pain. So best to get a handle on Outside-In now, while you can still leave competitors behind.

[1] We italicized the four Outside-In process components because they represent transformative change in the process world. This isn’t your father’s process. For that matter, it’s likely not yours–yet.

Dick Lee
Dick Lee is the founder of High-Yield Methods, a Outside-In consultancy focused on helping clients align strategy with customers, process with strategy and technology with process. In 1996, HYM launched the first, formal, Outside-In process approach, Visual Workflow. In addition to consulting with clients including American Express, Honeywell and Microsoft, Dick is a speaker, educator and author of several books and numerous white papers and journal articles.
Dick is an Executive Advisor for Towers Associates and sits on the board of the BP Group.

Steve Towers
Steve Towers is the founder of the Business Process Management Group a global business network exchanging ideas and best practice in Business Process & Performance Management, Transformation and Process Improvement. He works with many of the leading fortune 500 companies as a mentor, coach and sometimes consultant specializing in the implementation of performance improvement, process change and transformation. He has written several books, many business articles and appears on radio and TV. Steve previously worked for Citibank where he led restructuring and business process transformation programs both in the US and Europe.
Steve is an Executive Advisor for High-Yield Methods and sits on the board of the BP Group.

The BP Group
The BP Group is a global ‘not for profit’ business network originally founded in 1992.
As a ‘not for profit’ the vision is to connect and network people interested in significantly improving organisation processes and as a consequence business performance. Our mission is to help improve individual and corporate performance through advanced process management.

Pleasing Customers all the time?

This is a follow-up to ‘How to really annoy Americans’. You can join the extensive discussion to the original article at http://bit.ly/DdCLW

Let’s turn our attention instead to making people happy and for that we need a candidate organisation who know precisely how to create and manage call centres and the resulting activities. This is also derived from ARG’s research and provides useful pointers to all of us who need to intereact with customers via the phone.

Every telephone operator at Cabela’s speaks English, and a customer never speaks to a machine. “Every single call is answered by a live person,” Ron Spath, VP Customer Relations, states “We don’t have any interactive voice recorders and there are no menu’s. The feedback from our customers is very clear about how they appreciate not having to waste a lot of time to someone who speaks broken English. We realise that outsourcing these calls to india costs less but we think it is a good investment to pay more in order to save customers time.”

To cap it Cabela’s, the worlds largest outdoor retailer, even prints its telephone number on the front and every page of its website. Just imagine that, a company who actaully want to talk and learn from their customers.

This positive Outside-In approach pays on the bottom line and has seen Cabela grow to being the world leader in its market in just 50 years. You can read the story at http://bit.ly/xHYzL

So is it that hard to do. Actually let people talk to people that really understand?

Outside-In Process: The New Path to Customer-Centricity

By Dick Lee, High-Yield Methods

Peter Drucker famously opined that the greatest risk to organizations was neither doing the right work wrong nor doing the wrong work but not seeing or reacting to profound change occurring around us. Today, we’re in such a period of transformational change, with a powerful confluence of forces driving up the power of customers in buyer-seller relationships—and correspondingly depressing the potential for sellers to stay competitive while putting their own interests ahead of customer interests.

That this change is occurring is almost beyond debate. But how to effectively respond to this sea change is not only a matter for debate, but a source of great frustration for sellers. Fortunately, a growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threat—and using an approach becoming known as “Outside-In Process” or just “Outside-In” to build bridges extending out to customers.

Profiting from putting customers first

Since 1996, when it brought its first commercial product to market, Gilead Sciences has been among a group of companies providing pharmaceuticals to treat medical problems resulting from HIV-AIDS. But in 2006, Gilead leapt ahead of the pack by introducing a new drug developed not just for medical efficacy, but to improve quality of life for AIDS sufferers while also increasing patient compliance with following what had been an extraordinarily complex drug regimen.

A growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threat.

Gilead stepped outside of outcomes data and all the standard product development protocols to see medication through patient and physician eyes. And what it saw was patients taking its own “drug cocktail” in 17 different daily doses that required exact sequencing, including some via IV. And what Gilead also saw were patients unable to follow the regimen and falling off their medication as a result. Classic Outside-In vision through customers’ eyes. And classic Outside-In customer problem identification that lead to both a medical breakthrough and a customer breakthrough.

Access the full article here > http://bit.ly/fnmU0 <

How to please all your customers all the time

This is a follow-up to ‘How to really annoy Americans’. You can join the extensive discussion to the original article at http://bit.ly/DdCLW

Let’s turn our attention instead to making people happy and for that we need a candidate organisation who know precisely how to create and manage call centres and the resulting activities. This is also derived from ARG’s research and provides useful pointers to all of us who need to intereact with customers via the phone.

Every telephone operator at Cabela’s speaks English, and a customer never speaks to a machine. “Every single call is answered by a live person,” Ron Spath, VP Customer Relations, states “We don’t have any interactive voice recorders and there are no menu’s. The feedback from our customers is very clear about how they appreciate not having to waste a lot of time to someone who speaks broken English. We realise that outsourcing these calls to india costs less but we think it is a good investment to pay more in order to save customers time.”

To cap it Cabela’s, the worlds largest outdoor retailer, even prints its telephone number on the front and every page of its website. Just imagine that, a company who actaully want to talk and learn from their customers.

This positive Outside-In approach pays on the bottom line and has seen Cabela grow to being the world leader in its market in just 50 years. You can read the story at http://bit.ly/xHYzL

So is it that hard to do. Actually let people talk to people that really understand?

How to really Annoy American Customers

This is based on the research from ARG (Charleston)..

To really annoy your customers have them talk to a telephone operator in India.

The numbers from ARG reveal an uncomfortable truth:
“43% of Americans told us they can’t understand what a person from India is saying” and .. “21% get downright angry” Also “95% say they are provoked when a person speaks broken English when they answer their call” The same survey says “32% of Americans said its driven them to stop doing business with the company”.

We’ll review one excellent case study why it doesn’t have to be that way in the next mini article.

What is your experience?

Process Improvement – the tip of the iceberg

Most process improvement techniques focus on only a small portion of the improvement potential in every process… the tip of the iceberg if you will. How big is the opportunity resting out of our sight, hidden below the waterline of current practices?

Recent research by the BP Group suggests that 70 to 90 percent of the work people do comes directly from process Points of Failure and Causes of Work and this work is NOT part of the “job” for which these people were hired! Instead, this is non-value add work that takes away from people’s ability to do their job.

Does this sound familiar? Can you identify places where these Points of Failure and Causes of Work are distracting you from what you really want to be doing?

Are you required to fill out this form, check up on that order, or follow-up on those activities? Do you get tasked with finding the answer, knowing the rules, fighting that fire or explaining why you did this or that?

Fixing affects (the tip of the iceberg) only gets us so far. To create real change in how efficiently we use our time requires us to focus on eliminating the Causes of Work (the rest of the iceberg).

This is the first step we must take in aligning our businesses for success in the 21st Century.

Complexity is the Result of lack of alignment to customer success PART TWO

The debate rages over at the BP Group Linkedin zone… see http://bit.ly/LBhwq