Start with Your Customers' View in Every Strategy

Updated: October 13, 2010

Customer experience is defined entirely by customers, but the solution provider defines customer experience management (CEM). The customer is the judge of whether the experience was acceptable or stellar, or not; the customer defines the duration of their experience, as well as the context and the criteria. Therefore, CEM seeks to understand the gap between desired and current experience as seen from the customer's viewpoint (not just the competitive performance gap, per se). Then CEM solves the gap holistically and anticipates the evolving needs of the customer to prevent future gaps.

Customer experience is defined entirely by customers, but the solution provider defines customer experience management (CEM). The customer is the judge of whether the experience was acceptable or stellar, or not; the customer defines the duration of their experience, as well as the context and the criteria. Therefore, CEM seeks to understand the gap between desired and current experience as seen from the customer's viewpoint (not just the competitive performance gap, per se). Then CEM solves the gap holistically and anticipates the evolving needs of the customer to prevent future gaps.

Mis-Matched Priorities
Ironically, most strategic planning templates, consultants' models, and business and marketing textbooks begin with other topics and address serving a customer need much later in their prescription for success. While I strongly admire and advocate these organizations' thought leadership, I beg to differ with their starting point for customer experience success. For example:

• The Marketing Leadership Council's five steps describing world class marketing capabilities are: 1) developing strategy and planning, 2) defining brand strategy and managing the brand, 3) understanding customers, 4) managing the marketing function, 5) executing the marketing plan. My view: How do you know the strategy and brand are right until you know your customer? A deep understanding of the customer drives better segmentation, SWOT (strengths, weaknesses, opportunities, strengths) analysis, and branding.
• In the landmark book Managing the Customer Experience (2002) by Shaun Smith & Joe Wheeler, the first steps are to determine "how do our customers need to behave to achieve our key growth plans" and "develop and maintain a differentiated point of view that is credible and relevant to customers". My view: How do we need the company to behave in order to achieve alignment with customers that naturally results in desired growth?
• In a more recent book with great CEM advice, Customer Experience Strategy (2010) by Lior Arussy, the first step is "understanding the brand and its impact on the customer". My view: I agree with obtaining a deep understanding of the gap between the brand promise and reality from the customer's perspective, and the resulting impact on customers. This leads to adapting the brand as needed to serve the customer's need.

First Things First
Why not start with the customer? What do they want? What is their reality? Some managers reply that the customer doesn't really know; they're not expert in the sophisticated product or service they buy. Some managers point out that what customers say they want and what they actually buy are often two different things. Other managers admit that they never thought about that because they assumed the purpose of a business is to create profit, and therefore, customers should automatically appreciate the offering or perhaps customers must be educated on why the organization's offering is desirable and superior. All of these hesitations to listen intently to customers can be overcome with the right approach to CEM.

I'm reminded of cake recipes that advocate mixing the dry ingredients first; while the end-product is edible when this advice is not followed, it's less likely to win first prize at the county fair. Likewise, businesses that start with understanding the customer, rather than the other way around, become well rewarded financially for superior customer-centricity.

The famed professor Philip Kotler's more recent textbooks such as Marketing: An Introduction, 9th Edition (2009), now put the customer first: chapter 1) Creating & Capturing Customer Value, chapter 2) Partnering to Build Customer Relationships, chapter 3) Analyzing the Marketing Environment, etc.

Paradigm Shift
Some organizations do place voice of the customer as the starting point for their innovations, business processes, management attention, and resource allocation. As the diagram above depicts, certification to the international quality standard ISO 9001:2008 indicates which companies "demonstrate ability to consistently provide product that meets customer … requirements and aim to enhance customer satisfaction through the effective application of the system, including processes for continual improvement of the system and the assurance of conformity to customer … requirements".

Think differently! "To figure out what customers want and to successfully innovate, companies must think about customer requirements very differently", advises Anthony Ulwick in What Customers Want (2005). As innovation thought leaders have advocated since the late 1990s, Ulwick states: "Companies must be able to know, well in advance, what criteria customers are going to use to judge a product's value and dutifully design a product that ensures those criteria are met." This approach has been adopted for product innovations such as the Bosch CS20 circular saw, Motorola radios installed in vehicles, J.R. Simplot french fries, Pratt & Whitney jet engines, and many others. Ethnography, or observation research, is particularly useful in gaining a pure understanding of the customer's world. Metaphors are also very useful for expanding your organization's customer centricity. It's time for customer experience management community to adopt the thinking that the innovation community has espoused for the past decade.