If you are in for a customer centric strategy, you better prepare for an organizational transformation

On the evening of the (first) Corona wave, many of us are balancing our way forward. In the awakening of our fight modus, we start reflecting on our strategy to handle any kind of Shape V, L or U our industries are facing. To still be in the game tomorrow, all of these reflections must bring us to question our relationship to our customers. Because no matter how occupied we sometimes are with all things but our customers, it is a harsh truth that there is only one true source of value creation in any company and it is its customers.

In one of his recent essays Michel Houllebecq rightly said that the Covid-19 Crisis is an accelerator of previously existing tendencies all aiming to reduce human contact: online shopping, instant video calling, digital social networks, contact free payment methods, working from home…

That led me to think about how interactions with customers will materialize and how this sheds a light on the classical view of customer centricity which is mostly about understanding customers’ needs, understanding the change in customers’ needs, or even – for the more advanced amongst us – anticipating on customers’ needs rather than their mere wishes. For many of our sales teams and us the apparent challenge of creating proximity in a de-socialized world will inevitably change our way of selling. That is gravity! And although this will be a difficult and inevitable exercise, the real key to success is not only in building good relationships with customers, following market trends, asking open questions, gemba walking yourself through the customers’ premises or understanding the DMU…  All that is important but in vain if we do not transform our organization as a whole to become customer centric.

To become (more) customer centric is transforming your whole organization

To tango organizational transformation it needs two: a good system and a clear vision. Or more correctly said: a good implemented system and a clear communicated vision.

I have learned this the hard way, but change is not only about people. Surely, trusted and empathetic leaders come a far way in motivating their teams to engage in change and we can better be a positive leader then a bully. However, this alone doesn’t do the trick.

To transform a company we need a system and by that I don’t mean a bunch of rules and organizational charts that allow us to control our organization and measure any possible KPI however irrelevant or worse even, to expose the failures of the past and get lost in blaming and passing around accountability.

What organizations need is a systematic approach that covers the how of the golden circle. How can I increase the visibility on my customers and the way I go about them in my organization? Visibility allows us to create relevant information to various stakeholder in order to prioritize in a world of restrained resources. We are all called upon a more sustainable usage of resources. The motivational drivers can be divergent and reach from aggressive shareholder value maximization up to saving our planet form ecological collapse. So the first reason to drive a systematic approach on how we deal with of our customers is to create visibility in order to achieve flexibility, the ability to act proactively and eventually co-create with our customer.

The key characteristics of any system are old and do not change in essence:  you need to standardize and harmonize your processes and roles and therefore you need a transparent governance – central or decentral, both approaches need to be implemented systematically.

In a customer centric organization this is important because the differentiating factor is the customer experience which can reach from a uniform one for all or a very personalized unique feeling for each customer. But at both angles of this spectrum it is a targeted approach that needs clear processes that are repeatable for the customer to notice and appreciate. And they need to be scalable if we want to be efficient on our resources.

What is new in the equation is that in recent years, following upon standardization and harmonization we can now digitalize our processes generating an unseen richness of data that allows us to optimize the system to an unseen level, or even an unknown level if we think of the force of artificial intelligence.

True customer centric organizations have a solid data driven customer segmentation that steers all processes, particularly the supply chain processes. Therefore, technological deployment will have to be in the core of our system. In short, we need a data driven but classical system that sets us up for more visibility in order to use our resources efficiently.

But there is another reason why we need to carefully build an overarching system in our organizations if we want to be truly customer centric. I believe it is a leader’s duty to set up people for success and not for failure. A systematically built organization shapes a clear context which allows our sales teams to act successfully even in a de-socializing world.

To create value our sales teams need to interact with the customer, doing so under the new reality does not make it any easier. Selling is a people’s business, it is basically about human behavior from both seller and buyer.  Fact is: how you behave is less influenced by one’s wishes and drivers than the conditions that are governing them, such as hierarchical structures or the lack of them, incentive systems, underlying KPIs for appraisal, processes and roles or again the lack of them, efficient CRM systems, a well-managed order pipeline, forward thinking sales training, an organization that has a nose for rapid change… Therefore, how our sales teams interact with our customers is largely embedded in how our organization is set up.

And this is where the eulogy of the system comes to its inherent limits. No system dances alone, it needs to be fueled by a vision. In an increasing complex world, driven by changing customer needs, it is important to find a way to embrace this complexity and stop believing that we can reduce complexity. But no matter how good we become in bringing our system alive by standardizing, harmonizing and digitalizing, we are facing multiple transformations within our own organizations and the vision is the necessary glue that puts the frame in which creativity can grow and challenge the limits of the system.

With our strategy ‘Materials as a Service’ we also engage ourselves in the transformation with our customers. This is where a clear vision becomes even more valuable and where different visions have to grow together in the path of co-creation between our company and our customers. As a services provider, we are putting our success at risk if we do not truly understand and support our customers' transformation.

In summary, there is a need for a systematic approach that can evolve permanently pulled by our vision of how we read the world we act in. As companies we all have our visions well lined out, not always solidly communicated, but what is important is that no matter what the vision, it allows all participants to act in a way to multiply the options within the system. This also not so recent credo of Heinz von F?rster could well be the universal fuel of systems that are resistant to increasing complexity and therefore managing change.