Continuous Improvement Is About Caring, Not Just Data

For optimizers data is the air they breathe..

Data is both a blessing and a curse.

As a founder and Chairman Emeritus of the Digital Analytics Association, I make this statement knowing that I’ll have to defend it.

Only the companies that look beyond the data about company performance to see the data that reveals the customer’s reality are the brands that continue to impress us. Data is just a tool, and like any tool it can be misused.

Data is used to justify cost cutting by producing immediate results that are not in the best interest of the customer.

Data also provides false accountability for managers.

Data is a blessing when it reveals the customer’s reality, allowing us make sustainable improvements on their behalf.

Data is a curse when it replaces empathy.

Analytical Thought Represses Empathy, And Vice Versa

Executives are flooded with data. The problem is that we are neurologically hardwired to repress empathy in the face of data.

Engage the brain's analytic network and, according to researchers, you depress the mind’s ability to empathize. As shown in this 2012 Case Western Reserve University study, our built-in neural constraints means that we have to chose: we can be empathic or analytic, but not both at the same time.

The upshot for data and analytics is this: if we don’t start with empathy for the customer when we begin collecting the data, and then return to caring about the customer experience as we decipher the meaning of the data, then our immersion in the data will naturally pull as away from the sustained customer focus our companies need to achieve lasting success.

Fortunately, with the right process, we can bake-in safeguards for overcoming data’s curse of empathy repression.

Continuous Optimization Is A By-product Of Caring

In chapter 6 “Be Like Amazon: Even A Lemonade Stand Can Do It” we wrote:

“SUNSHINE, when you care about your customers and care about your employees and care about your suppliers and care about your investors, you can build a rocket ship while you're flying it."

"Is caring the fuel that lets you ?"

"Caring is the fuel."

The younger man spoke a sudden realization.

"Continuous optimization is a by-product of caring." The old man nodded. "When you really care, you never quit trying to make things better." -

Kaizen Is A Cultural Mindset, Not A Tool

Kaizen is a Japanese word for “Change for the better” it is also known as “Continuous Improvement”. Kaizen was introduced to the West by Masaaki Imai in his book Kaizen: The Key to Japan’s Competitive Success in 1986.

Kaizen asks everyone in the organization to identify problems and then develop and implement ideas to solve them. Kaizen philosophy says that everything can be improved and everything can perform better or more efficiently.

Kaizen identifies the three MU’s :

1. Muda - waste
2. Mura - inconsistency
3. Muri - stress on people & systems

Kaizen is continuous improvement based on unifying principles:

• Do the right thing! Good processes bring good results.
• Figures lie and liars figure. Go see for yourself to grasp the current situation.
• Speak with data, manage by narrative. Stories create empathy.
• Take action to correct root causes of problems.
• Empower agile teams to solve problems and seize opportunities.

Big results come from many small changes accumulated over time. Yet this is misunderstood. Kaizen isn’t about small changes. In fact, kaizen means that everyone is involved in making improvements. While the majority of changes may be small, the greatest impact may be improvements that are led by senior management as transformational projects.

Kaizen is not the only way to think about continuous optimization or Total Quality Management.

Total Quality Management and Customer Experience

Anything that results in lower customer satisfaction is a defect. It's a flaw in your customer's experience. You do aim to constantly deliver 5 star products and service? When a potential or repeat customer fails to achieve their goal, your business has a service defect. It means your processes don’t deliver on your promises. That’s how you’d look at things if you applied total quality management to your business.

If you asked the late total quality management guru, W. Edwards Deming, he might say:

“You create the system your visitor must navigate. People don’t cause defects, systems do,”

Are you prepared to apply caring to your own optimization efforts?

Buyer Legends is a customer-centric process that allows you to be data driven, yet manage by empathy reinforcing narrative. Buyer Legends is how we identify and tie analytics to continuous optimization. The Buyer Legends process makes everything worth measuring, measurable.

Buyer Legends Five Step Process For Replicating Amazon’s Four Pillars of Success

In chapter 12 of Be Like Amazon: Even A Lemonade Stand Can Do It we explain:

Customer Centricity is always the first push on the flywheel. Your people will come alive and get electric when they see how Buyer Legends create ongoing opportunities for Continuous Optimization in a Culture of Innovation. But none of this will happen if you don't have the Corporate Agility to execute the ideas generated by the process. The momentum of your flywheel depends on your organization sharing a single, forward- moving narrative. And its details have to be clear across the team.

You can also learn more details about how to create your own Buyer legends, but this is a useful summary:

1. Select your perspective - You’ll want your organization to tell stories from your customers’ perspectives. This has a transformative impact. This is the start of a CUSTOMER CENTRIC approach.
2. Perform a pre-mortem - This helps you gain insight beyond data about your company’s performance to see what the data that reveals your customer’s reality. Armed with data, identify all the possible shortcomings in our customer experience. This is also the time to INNOVATE improved alternative experiences.
3. Outline the story backwards - Jeff Bezos tells us how he approaches opportunities and refines his offerings. Bezos starts at the end; imagining what it takes to delight a customer. This helps your organization realize all the opportunities for CONTINUOUS OPTIMIZATION. We describe the experience from the end to the beginning. After all, all that ends well starts well. This is also when we identify the key input metrics that lead to the right customer outcomes.
4. Draft the Buyer Legend - Continuous optimization only happens when your organization has the AGILITY to execute on all the ideas we have in our plans generated by the process. This happens when the organization shares one narrative and all the details are clear across the team, from the boardroom to the stockroom.
5. Execute - improve, rinse and repeat

CRO, Local Maxima And Twitchy Little Bastards

Many executives pride themselves on their optimization efforts that boost results at the expense of long-term sustainability. When continuous optimization is based on optimizing business processes, instead of customer experience it degrades. It degrades into short-term tweaks and shortcuts that short change customers.

Twitchy little bastards obsess over short term results. They focus on them even if they are driving the brand off a cliff. Many of Kodak’s executives were “hitting their numbers” as they devolved into irrelevance. How many retailer executives still think they’re doing a great job?

Jeffrey and I have been focused on continuous optimization for twenty years and it’s never been exclusively about data or the false idol of conversion rates.

In 2001 I wrote:

Conversion rates are a measure of your ability to persuade visitors to take the action you want them to take. They’re also a reflection of your effectiveness at satisfying customers, because for you to achieve your goals, visitors must first achieve theirs.

When customers don’t achieve their goals first, all you’ve achieved are local maxima. By the way, that’s why we think Conversion Rate Optimization (CRO) is a dead end.

If your optimization efforts are restricted by channels, departments, legacy systems or clinging to the status quo you can still hit your numbers. However, customers know you don’t care about them and they will return the favor.