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Assess the Scene

Tuesday, October 29, 2013

Over the past number of years I’ve taken my wife and three teenage children on extended backpacking trips. Well aware of the risk of injury in the wilderness, I attended a wilderness first aid course. One key principle was drilled into me over and over again: Assess the scene. Often, those first on the scene of an accident rush in to help, jeopardizing their own safety or worse, causing greater harm to any victims. Similarly, customer executives and especially chief customer officers need to “assess the scene” before pushing their agenda to create a customer-centric culture.

Although we as customer executives might be tempted to argue that creating a customer-centric culture should come first and foremost, in situations of high stress, it is inevitably shoved to the back burner. A physician can’t help you with your diet when you are in a diabetic coma any more than the fire department can teach safe driving habits while they are extricating you from a wrecked car. Just as the time for preventive measures is long before the accident, attention to culture must take place before the crisis.

However, when a crisis does arise, effective CCOs will choose their battles carefully, sometimes pausing the long game and helping to put out the fires. The first thing they will do is assess the scene to determine where in the company assistance is most needed and how best to provide it. Successful customer executives will:

  1. Identify the most dissatisfied customers at risk of churn through whatever means possible (engagement measures, account team reports, escalations, surveys, social media, etc.).
  2. Prioritize and connect with the highest priority customers to discover issues and needs, be they urgent or latent.
  3. Gather a cross-functional team to understand, assess, prioritize, and resolve issues. Most importantly, the team must close the loop with customers, either indicating that the issues will not be addressed or providing a time frame for their resolution and ultimately delivering on that promise.

As is said in political arenas, “Never waste a good crisis.” A crisis is hardly the time to focus on creating a customer-centric culture. However, by understanding and leveraging customers to weather a crisis, customer executives foster goodwill and lay the groundwork for an increased focus on customers after the crisis has passed. Once in the clear, CCOs are in a much stronger position to enlist the larger organization in preventing future crises.

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Categories: Customer Centricity | Customer Retention | Chief Customer Officer

The New Silver Bullet for Growth and Customer Loyalty

Tuesday, October 22, 2013

If you want to grow your business while simultaneously increasing customer loyalty, the chief customer officer (CCO) might just be the silver bullet you are looking for. The CEO is uniquely responsible for shareholder return, the COO for cost-efficiency, the CFO for the company's financial well-being, the CMO for market awareness, and the EVP of Sales for quarterly revenue. One executive must be held accountable for not only the strength of customer relationships but especially customer value (i.e., the value of a customer to your company as well as your value to the customer). This customer champion must be able to properly weigh customer needs against revenue, cost, and other strategic business drivers. As well, the role of customer champion must be an executive-level position to effectively gain trust in customer and prospect organizations as well as drive change throughout many different divisions.

The chief customer officer, or other similarly titled executive, is uniquely capable of fulfilling this role and of helping your organization achieve the following five objectives:
Grow Revenue
By establishing customer value metrics, the CCO can identify the most valuable customers and help marketing and sales find more prospects just like them.
Increase Customer Profitability
As I've written elsewhere, not all customers or prospects are created equal. In one extreme case, researchers found that 20% of a manufacturing firm's customers generated 220% of profits. Fully 80% of customers were marginally profitable or even unprofitable! With a CCO's breadth of customer insight, companies can effectively segment customers according to customer value drivers.
Increase Customer Loyalty and Retention
Because of the CCO's regular interaction with customers, consistent "health measurements," and early warning mechanisms, this indispensable officer is uniquely capable of identifying customer dissatisfaction and potential for defection.
Develop Sustainable Competitive Advantage
In this age of hyper-competitiveness where any feature or service-based differentiator is easily duplicated, the only truly sustainable competitive advantage is in-depth customer understanding. Under the direction of the CCO, companies that make customer insight actionable and drive customer-centric change throughout the organization will be successful. 
Decrease Costs
The CCO, by virtue of his/her position and breadth of involvement with current customers and the marketplace, is uniquely positioned to determine levels of support and attention given to customers according to customer value metrics. As a result, decisions and priorities will more likely maximize customer value to the company.
Your company can reap multiple benefits by establishing the role of chief customer officer. You will be able to maximize the profitability of current and future customers; increase customer loyalty and retention, and ensure long-term success as you develop the in-depth insight into what customers need, want, and are willing to pay for. Incorporating the CCO function leads to longer and more profitable relationships with key customers, which in turn leads to achieving the ultimate goal of increased and more profitable revenues.

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Categories: Chief Customer Officer | Customer Centricity | Customer Insight | Customer Loyalty | Customer Retention

Don't Lose the Trail!

Tuesday, October 15, 2013

At the end of each summer for the past 5 years I’ve taken my family of five on a backpacking trip of at least 50 miles. These trips have been amazing bonding experiences for our family, as three children - their digital tethers cut - learned to look beyond themselves and look out for each other, even if they started selfishly (“She’s carrying my lunch!”).

This year my youngest decided he wanted to do an epic journey with full bragging rights. We chose the 100 Mile Wilderness, the northern terminus of the Appalachian Trail, which, at just over 100 miles, is the AT’s longest stretch of wilderness. Despite significant research and planning, we fell woefully short of our mileage goals on our first day. And the following days weren’t much better. The trails were horrible. They were full of boulders, rocks, tree roots, mud bogs, and river crossings. Our feet were sore and our spirits flagging by the time we reached each night’s camp.

One particular trail took us down the steep side of a mountain via a rockslide that went all the way to the bottom. We carefully picked our way down, sometimes having to lower ourselves over boulders as tall as we were. About halfway down, I noticed on one of the rocks a white blaze of paint angling off the to the left. My wife and son hadn’t noticed this weathered marker, focused as they were on each treacherous step in front of them.

If I hadn’t noticed that trail marker either, we would have continued to the bottom. There we would have cast about for the trail markers, and not finding any, would have had to climb back up the boulder field as we retraced our steps to the last known marker. It would have cost us hours of precious daylight and prevented us from reaching our campsite before nightfall.

On this hill, all it took was one person to say, “There is the next mark!” to save us hours of strenuous effort wasted in going down the wrong path.

The Chief Customer Officer Council gathers together brilliant customer executives, each with different levels of experience and resources. We, too, are on a challenging, poorly marked trail. It’s called the customer journey. Some of us have traveled this trail before and can offer clear landmarks and instructions to avoid the hazards. Other sections of the trail haven’t been traveled by anyone yet. In this unchartered territory, all it takes is one person to say, “There is the next big trend!” to point everyone in the right direction.

Last year, volunteer crews gathered to create order out of chaos on another leg of the 100 Mile Wilderness that we climbed. They spent countless hours clearing boulders, lifting stones, and setting in place steps that made a challenging hill trail simple for all those yet to come. Similarly, as a result of our efforts together as peers in the Council, we are paving steps up the customer journey hill with shared best practices, guidelines, and standards that enable members to avoid missing precious trail markers or making costly and time-consuming mistakes. Together, we’re creating the best map in the world.

Wouldn’t you rather walk along this path with us? Contact me if you’d like to talk about how these foremost chief customer officers from around the world can help you achieve success.

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Categories: Chief Customer Officer

Member Guest Blog: Common Accountabilities of the CCO

Monday, October 14, 2013

As competition heats up and customers become more demanding, many companies play to strengthen their customer relationships to better understand and meet current and future customer needs while solidifying their current business. Some companies recognize the value of assigning accountability for customers to an executive, most often titled “chief customer officer” or CCO, but given other names as well. The CCO or its equivalent is considered to be a company's ultimate customer authority and is driving customer strategy across the highest levels of his or her company. There are many different implementations of the CCO role. But what are its primary contributions? The Chief Customer Officer Council (CCO Council) identified seven common accountabilities of CCOs based on research among its own membership.

Council members identified 16 important functions that could potentially belong to a CCO. These were used as the basis for a written survey, which was then sent to the entire membership base via the Internet. Members were asked to report on the responsibilities that were incumbent upon them in their current roles and to rank those responsibilities as prioritized by their organizations. Results were returned by 60% of the membership. The resulting seven common accountabilities of a chief customer officer are:

  1. Customer-centric tactics
  2. Customer Experience management 
  3. Metrics and analytics related to customer-centricity
  4. Customer-centric culture or the evolution to such
  5. Customer strategy
  6. Understanding customer needs
  7. Building customer relationships

There were two skews identified. The first was a skew to large companies with greater than $1B in revenue. The second was a skew towards B2B (vs. B2C) companies. More details regarding the accountabilities can be found in the full article published on this page

While the activities a CCO might engage in are legion, these seven appear to be the most common and important regardless of company size, industry, or definition of the CCO role. Even if your company doesn’t have a CCO, to become truly customer centric and create sustainable competitive advantage, an executive needs to be held accountable for activities, at a minimum.

Are you managing to these activities?  What others are you being held accountable for?

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Categories: Chief Customer Officer

Customer Experience Director Is the Wrong Place to Start

Tuesday, October 01, 2013

Someone recently asked, "Is it time to hire a director of customer experience, or a chief customer officer?" The question suggests a certain naïveté as it implies that there might be a progression from the need for a customer experience director to the need for chief customer officer. In my 10-plus years working with chief customer officers, it is very clear to me that your company cannot have a successful customer experience director without first having a chief customer officer.

A customer experience director has neither the line authority nor the process authority required to change customer strategy at the highest levels of the company and therefore cannot make changes across departments, divisions, or the enterprise. Consequently a customer experience director, without the vocal and visible support of a critical member of executive leadership, can only be someone who puts a Band-Aid on something that is broken and typically only within whatever department he or she may be part of. Changes wrought by a customer experience director typically end up being localized rather than sweeping, and executed at great personal cost if extended beyond the local organization.

If instead a chief customer officer were driving the systemic customer experience changes, a customer experience director could be of great value to a company. A chief customer officer, whether or not explicitly titled as such, is uniquely accountable for customers across all departments and is driving customer strategy at the highest levels of the company. As a result of explicit line and process authority, executives can far more effectively transcend organizational boundaries, minimize turf wars, and execute comprehensive customer strategy from which logically follows a consistent customer experience orchestrated across all touch points.

Many CCOs are beginning to hire customer experience directors to more effectively manage the customer experience, which although important, is just one of many of the CCO's responsibilities. Without such explicit executive support, a customer experience director is doomed to failure. However, with such strong executive support a customer experience director can thrive in his or her singular focus to improve the customer experience, but without having to fight the battles inherent in conflicting customer insights, turf wars, and competing budget or strategic priorities.

So before you jump on the bandwagon and hire a customer experience director, make sure you first have a member of the executive leadership team uniquely accountable for the customer and for driving customer strategy at the highest levels, who will pave the way for this person's success.

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Categories: Chief Customer Officer