Organising for customer focus
Where do I place my vote? I genuinely don’t think it matters.
The debate about who is responsible for the customer and who reports to whom confuses organisation structure and organisation design. The view that structure can fix problems is not new. “We trained hard, but it seemed that every time we were beginning to form up into teams, we would be reorganized. I was to learn later in life that we tend to meet any new situation by reorganizing; and a wonderful method it can be for creating the illusion of progress while producing confusion, inefficiency, and demoralization. During our reorganizations, several commanding officers were tried out on us, which added to the discontinuity.” Often mistakenly attributed to a Roman author, the quote is a mere 60 years old from Charlton Ogburn Jr describing World War Two campaigns in Burma.
The debate about who owns the customer actually diverts companies from focusing on the right things. It is also an almost impossible problem. Customers are why companies exist and touch almost everyone in the company at some time in their life. With the exception of legal and regulatory functions, everyone should be working for the customer. Managing that span is the job of a CEO.
Proper organisation design is about much more than who reports to whom. Neither Disney, Zappos nor FirsPostst Direct have a Chief Customer Officer but that does not stop them being among the most admired companies for customer experience. That’s because they master the real elements of organisation design: work, measures, incentives and leadership. Designed well, these factors produce a positive, customer and performance oriented culture where everyone is a mini CCO.
My advice therefore is work out the answers to the following questions and then, and only then, consider reporting structures.
- Who are our chosen customers and what do we offer them that is unique and compelling in both the product/service and the broader experience?
- What are the key stages on the customers’ journeys and for each step, what are their most important needs? The customer journey may well start before a potential customer is aware of a need and your ability to help them. Don’t fall into the trap most companies make and assume you know what customers want; you probably know only 25% of matters most to them. Good research here focuses on their goals and concerns. Ask them not only what they want but how they want to feel: emotions drive buying behaviour.
- What is our designed experience? This embraces product/service, how the customer wants to interact at the different stages (including channels of communication), the quality of interactions and the advice and support you provide.
- What skills and systems are needed to deliver a great experience at each interaction? What information do we need to collect and provide to build trust and confidence in the customer?
- How do we measure and share data about the quality of the interaction from both the customer and the company perspective? The key here is to focus on measures that address both quality and productivity. Great companies will avoid trade-offs and seek answers that improve both.
- What mechanisms do we need to drive continuous improvement? Some companies turn to formal methods such as lean or six sigma but teaching people basic skills of data analysis and problem solving will help. Then give them the right information, the responsibility and autonomy to solve problems and let them get on it with.
- How do we improve people’s ability to make data-driven decision?
- How do we incentivise people to give their best and employ extrinsic (financial) and intrinsic motivation. The TED talk on motivation by Dan Pink is a must see.
- What mechanisms, e.g. project teams, steering groups, customer councils, can we exploit to foster collaboration? Used well these are far more powerful in driving customer focus than reporting structures. Don’t overlook the value of ad-hoc or unplanned conversations.
- What are the core values and behaviors we live by and how do they guide our recruitment, reward and other practices? Work hard to help people understand them by repeatedly sharing stories that exemplify them. Beware of systematising them in things like performance management systems – it just makes them artificial.
- What do we expect of our leaders and how do we select and develop them? People take their cues about how to behave from leaders; they shape significantly the culture that develops. As one CEO once told me: “Leaders cast a shadow over the organisation. I want mine to cast a shadow of light, not darkness.”
These questions represent a manifesto for change which if addressed will work whatever the title of the person in charge. Purposeful organisation design is not an easy process but it trumps the alternatives. Remember, every organisation is perfectly designed to achieve the results is does. If you want to change your outcomes then address the root causes and then you will need to worry less about.