What is interesting is that, in our part of the world (that is, Central and Eastern Europe), we have always looked to the USA and Great Britain as leaders in the field of the introduction of advanced management concepts. Consulting firms, which are usually carriers of new ideas, have piloted new concepts in these markets. Furthermore, branches of international companies usually send their best managers to learn into the USA and UK because new, innovative business concepts were first introduced in these markets.
The concept of building a customer orientation or customer experience is meant to be a response to the continuing commoditization of products and services and the cynicism of customers who increasing decide solely on the basis of price. The aim should be to ensure that the company takes necessary steps to support the creation of an emotional bond from customer to brand, thereby strengthening his loyalty.
The study, which examined the opinions of more than 400 senior and middle managers in the UK and USA, resulted in several interesting observations that are also of relevance to our environment:
1.) 74% of respondents characterized the relationship between the customer and their brand as an “open marriage”, or worse. Loyalty to the company is determined mainly by short-term factors (such as price) and customers are quick to transfer their contract to competitor.
In other words, even after more than 10 years of investment projects and bold declarations on the part of managers, customers have failed to see any results. This result would have been expected at the beginning of “the era of building customer experience”; today, however, the results should be on the table and financial returns on this investment should be clear. So what went wrong? I think the fundamental problem was the very approach. Projects were based on methodologies built on in-depth procedural and technological analyses, and often lead to high investment in IT and long life cycles. However, because these projects did not bring immediate results, as soon as something noteworthy occurred in another area, attention was turned away from them and they were quietly abandoned.
Even in our environment, the fight for the customer is intensifying, and companies that are coming under strong competitive pressure have, for several years, already been including an excellent customer experience in their strategies. This is particularly true for the telecommunications company, whose “golden age” is gone, but the banks, too, have started to feel that the longstanding and stable market-sharing split between several major players may soon be a thing of the past. Pilot projects have been carried out and roles such as “Customer Experience Director” established, but the real change has not yet occurred, and the reputation of these companies in our market is fairly poor. Building a great customer experience is a task whose character is not particularly compatible with the project approach, which has a clearly defined goal, beginning and end. Customer experience is not simply a project: it is an approach. It is the attitude of the entire organization and must be integrated into the culture of the company and into its “DNA”. As long as this does not happen, companies cannot expect an upturn.
2.) More than 50% of executives believe that customers expect something more from their company than simply a good price and reliable product or service. They therefore declared the need to build a strong customer experience. The same opinion, however, was shared by only 24% of middle and lower managers.
This is an interesting result, and it explains a lot. Senior managers have a vision in which they believe and which is included in their strategy, but middle management thinks and acts differently. An idea which is transferred from higher levels and not rooted in the daily work on the frontline, has no chance of success. Unfortunately, unlike other tasks, the development of a genuine relationship with the customer cannot simply be ordered to happen, and if a middle manager thinks and acts differently, he or she creates a bottleneck affecting the whole branch of the organization which is controlled or influenced by his or her decisions. The results of the study show that the existence of such bottlenecks is not rare in a typical organization in the UK or USA.
It would be foolish to think that things are different in our environment. In performance management, we generally manage to define quantitative targets that can be easily measured and use them to set goals for lower management levels. Achieving the expected level of sales and revenues must be a priority, but it is very easy to slip into a situation in which meetings focus solely on this goal, thus sending a clear signal to the organization that nothing else is of any great importance. If we fail to ensure that the collective attitude of middle managers to the issue of building customer experience is not cynical, but that they instead see it as a natural part of their personal managerial “mission”, we will not be able to move forward.
3.) 64% of executives plan to do something that will “sweep their customers off their feet” in 2013.
In light of the conclusions drawn above, this statement is not very credible. It seems more like a mandatory statement on the part of CEOs, who know that shareholders expect turnover in management, increased profits and market share, but lack the solid plan. Something that has not been achieved for a decade can hardly be expected to change within the next few months. A realistic goal for such a short space of time might be, for example, to launch a “revolutionary” new product that temporarily captures the customer’s attention (an example being the recent “unlimited” tariffs offered by mobile operators in the Czech Republic). However, when the only difference is in price, a long-term impact on loyalty cannot be expected. In contrast to examples such as Apple, most companies cannot rely on their product as a source of admiration on the part of customers. Instead, they must win the customer’s favour and differentiate themselves through their approach and excellent reputation, which is always a long-term struggle.
What, then, can we expect next in the field of relations between major companies and their customers? Those who are serious about the matter must learn to stop repeating approaches that have proven to be ineffective. One of the possible approaches suggested by the results of the study is to focus on employee engagement. In this approach, forming engaged, first-line management teams becomes a priority and detailed processes and IT steps come into play only after that. Only a change in the collective attitude of the whole team regarding the need to fight for the customer’s favour can lead to effective action being taken towards improving a company’s reputation in the market.
What do you think?