Jeff Bezos encourages us to become Customer Obsessed (see video snippet) however Netflix’s journey to CX Obsession is less well known.
Here is an extract from a great article (link below):
From Gibson Biddle, former VP at Netflix and CPO at Chegg In 2005, as I joined Netflix as VP of Product, I asked Reed Hastings, the CEO, what he hoped his legacy would be. His answer: “Consumer science.” He explained, “Leaders like Steve Jobs have a sense of style and what customers seek, but I don’t. We need consumer science to get there.”
Reed’s aspiration was that the Netflix team would discover what delights customers through the scientific process. Forming hypotheses through existing data, qualitative, and surveys, and then A/B testing these ideas to see what works. His vision was that product leaders at Netflix would develop remarkable consumer insight, fueled by results and learning from thousands of experiments.
During my time at Netflix, and later at my next startup, Chegg, I learned to move from customer focus to customer obsession. In doing so embraced Reed’s notion of consumer science. Here’s how I think about the transition:
The full article here is great testimony to moving away from the soft and fluffy version of Customer Experience. Let’s get more scientific about Customer Experience.
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Who started #customerexperience ? Well, there has always been a customer experience, however, it is only in the last 20 years that companies have realized the need to get scientific about shaping and innovating #CX. Who was the pioneer that did that first? And in doing so shifted the emphasis from Industrial Age thinking to Outside-In practice. Let’s jump into the time machine and rediscover Steve Jobs back in 1997.
Moving from Product to Customer-Centric
Back then it wasn’t understood that designing Customer Experiences and delivering Successful Customer Outcomes went way beyond being product-centric. Steve Jobs anticipated this shift towards customer-centricity, and evolved Apples approach to rapidly shift to Outside-In strategy and operations.
Many of the concepts we accept, such as defining the customer experience from the customers perspective, and not the organizations, were developed in the cauldrons of Apple mountain. In fact, one of the key techniques within the CEMMethod™ was initially referred to as the ‘Apple Innovation Approach’.
Why so many still get it wrong
Here’s a great mini video explaining the difference in viewpoint Inside-Out v. Outside-In.
We saw that at work in Outside-In design of products like the original iPod, the iPhone and the iPad. Now taken for granted the last century was a mish mesh of competing chunks of technology (think the early MP3 players) that often required an MSc to understand the menu system and driver updates.
It isn’t what they want, it is what they NEED
Nowadays the major consumer product companies understand the requirement to articulates the needs of customers, and only then design products that meet those needs. That is Outside-In in action.
You would be right in saying he was the pioneer of Outside-In.
If you would like to dig deeper I talked about the difference in approaches of Industrial Age v. Customer Age/Outside-In in this article.
This item has caused quite a stir over at LinkedIn, you can join that discussion here.
Business failures are all around us, nothing new there then. If we go back a decade or so we saw the demise of Nokia, we’ve seen companies like Blockbuster crash and burn, and other companies in the High Street whether it’s in Europe or in the US disappear and never to be seen again.
Why is this so when if you look at the investment those companies were making there was no lack of intent to spend in understanding how the customer was changing. In the year that Apple introduced the iPhone Nokia were investing very heavily in the voice of the customer surveys, customer satisfaction and NPS.
But this misses the point. Progressive Outside-In companies (think Amazon, Zara, Zappos, Emirates) are not about retrospective subjective analysis of performance. It isn’t about overlaying processes with a new language when fundamentally the very systems and processes were never designed to deliver experiences. They were designed with a factory mindset centred around production line thinking, throughput and waste. Hence the challenge is more fundamental as it’s not about rejigging what you’re doing – it is about a complete rethink to move outside in the way that you do business.
Remarkably as we approach the third decade of the 21st century there are still those companies that think they can just tweak and change the language inside their organisations. As if doing better advertising and marketing to customers and talking about ‘new’ services on top of their existing infrastructures and IT systems hacks it. The actual reality is somewhat different.
Senior Executive commentary
Top teams and senior executives need to grasp this challenge. Roland Naidoo, a senior executive at African based entertainments company Multichoice puts the choice starkly:
“Would you measure how fast a 1600cc car performed around an F1 circuit. No? Then why would you try to measure customer experience AND improve it on processes and products there were never designed with experience in mind. Go on enter your 1600 into the next F1. Wonder how it would perform?”
Roland Naidoo, Multichoice Africa
Lipstick on a Pig? Surely not…
Those companies who understand that ‘outside-in’ thinking calls for a complete realignment and new appraisal of what the customer experience consists of. Rather than, to coin a phrase, putting lipstick on a pig. You have actually got to think about what is it you’re trying to achieve; what does success look like for our customer? And then align across all functions, all systems and ways of working towards successful customer outcomes. Disney refers to this alignment as getting everybody to understand where true north is and not to do anything unless it contributes to that alignment. Imagine all new initiatives being assessed by a similar approach?
Are you working in a Rubik cube?
Another aspect which comes into play is this idea that traditional measurement* is predominantly subjective and retrospective. Progressive outside in companies are not reactive – they get scientific about the customer experience. Measuring each interaction as it happens and if necessary course-correcting in real-time. They develop the ability to see around corners to understand what’s coming next. They don’t have to wait for analysis 2 weeks after an event to decide that some remedial action is required. This knowledge in the instance of what is happening requires us to create this idea of ‘action in the moment’ for all our employees. Zappos**, for instance, give their employees the tools and the capability to be able to make decisions in the moment (without the need to escalate to supervisors).
Industrial Age thinking will kill you
And there is another challenge companies face if they are still organised around functional specialist silos. If you’ve recruited low paid people and given them a script to follow, manage them to average handle times and throughputs you’re going to fail. Once more the outside-in companies have an edge here as they understand that to give your most precious resource (the customer) to the employees then you need the right people in the right place able to do the right things at that moment of truth.
So what is your organization doing? is it trying to put lipstick on the pig? is it just trying to overlay the existing process is an infrastructure with this new customer-centric way of talking and doing?
It is very simple. You need to get down to brass tacks of rethinking what customer experience is all about its implication for the organisation going forward. Those organisations that are taking this outside-in approach find the world becomes simpler, faster and much more directly oriented towards delivering successful customer outcomes and winning for the bottom line.
In just 60 minutes we will evaluate the 4 elements of a Customer Experience Management Ecosystem and how they can provide your organization with a company-wide ecosystem of CX management that focuses all of your team’s efforts and resources on delivering amazing customer experiences.
We are doing a CX POWER Hour this coming Wednesday 1 PM EDT/ 10 AM PDT Expert hosts include James Dodkins aka CX Rockstar, Doug Bell, Mitch Belsley (The Experience Manager) and Steve Towers BP Group.
In just 60 minutes we will evaluate the 4 elements of a Customer Experience Management Ecosystem. We will review how the 4 elements can provide your organization with a company-wide ecosystem of CX management. This then focuses all of your team’s efforts and resources on delivering amazing customer experiences.
What we will cover
1. Operationalizing Experience Designs
(How do you create and socialize simple experience designs that everyone in the organization will be able to understand?)
2. Measuring successful customer outcomes instead of business outputs
(Are you still relying on subjective NPS and VOC data to drive your CX analytics program?)
3. Focus every employee in the company every single day on CX innovation and improvement
(Are you harnessing the power of feedback and ideation from your employees?)
4. Evolve and improve your experiences in days not months.
(How long is it taking you to go from idea to implementation?)
When you align your business around an understanding of your customer, you can increase your ability to grow revenue, significantly reduce cost, radically boost customer loyalty and engagement, tighten controls – and increase your competitive strength.
The Panel of Global Experts
Meet and discuss with our world-renowned team of Customer Experience Management innovators including… Doug Bell, James Dodkins, Mitch Belsley and Steve Towers will share proven strategies, tactics and tips to help position your customer ‘front and center’ – while addressing your real-world challenges of limited resources and competing priorities.
P.S. I suggest you follow The Experience Manager on LinkedIn and stay up-to-date on how to radically improve your customer and employee experiences. We focus the ‘next practices’ of the world’s leading CX companies that will help your organization do a better job designing, developing and delivering great customer and employee experiences.