Archive for the 'chief customer officer' Category

Posted by: Peter Massey | 27.01.2008

Our companies abound with “CXOs”: the CEO, the COO, the CFO, the CMO, the CIO. But what about the CCO, the Chief Customer Officer. The person who s accountable for the “Customer” in the business. Does your business have a CCO? Is your CEO the CCO?  In most businesses there is an operations director, a customer services director. In some now there is even a customer experience director.   This is particularly true in financial services in the UK. The regulatory body, the Financial Services Authority (FSA) is enforcing something called “TCF” or Treating Customers Fairly. Its intent is extensive. To change not only the reporting but also the culture and executive responsibility for the way customers are treated by financial services companies.   But is the need for a Customer Experience Director in itself missing the point. The point that everyone should be championing the customers’ cause. Everyone should be a CCO. There should be an army of CCOs in every business.  

For example take this organisation chart from Starbucks. There’s the customer and then there’s every employee. If only this were true in real companies we would not need a CCO.

In practice, the organisation chart looks very different. There are many layers of management above the employees who talk and deal with customers. Many staff who do not talk to customers but who have responsibilities, targets, accountabilities and obligations to shareholders.   The further up the organisation, the greater the perceived shareholder pressure. And the lower the perceived customer pressure. It is tempting to look at the customer vs the shareholder as the debate or the balance to be achieved. But what if they are not opposite ends of a  seesaw. But the same thing. What if we can get more value by getting both shareholders and customers to the same end of the seesaw rather than just getting a balance between their needs.

At the heart of the challenge, of the see saw, one needs to look at the time frames that the shareholders and customers use. The very short term. The very long term.  The two parties both want the same thing – to maximise the value they get from the transactions between them. But the customers’ view of value is frequently wider, longer and more complex than the shareholders’ view.  

When it comes to buying insurance, customers seldom forget how they were treated on a claim 10 years before. When their business bank is trying to sell pensions to their company, customers do not separate the bank from a poor experience of trying to replace a stolen credit card on their personal account. When offered free internet by their phone company, customers can turn the offer down because they have wasted so much time sorting out their mobile bills.  Yet businesses continue to play the short term game. To incentivise customers to buy with offers that they fund from marketing and sales budgets. Offers to stay, to buy more, to recruit their friends. Offers for better functionality, better prices, free add ons, special treatment. Companies need to make sales targets each month, each quarter, regardless of external changes.   These are all legitimate things to do. But so much more expensive or so much less expensive depending on whether the customers concerned are emotionally on your side or not. So much harder or easier to meet targets depending on what your customers have experienced from your company before. So much harder or easier to execute on plans if the staff who talk to customers are on side or not. We know these things to be true.  

But in business we “need” things we can measure. True representations of how customers behave are very hard to measure. Results are in reality based on complex interactions. Based on emotions which change rapidly. Much harder to measure than actual sales volumes, costs or profits. So how can a CCO compete with a CFO who can measure numbers in columns? How can he compete with the CMOs sales figures?  The answer is it’s very hard. But it’s started to happen. Many companies now take simplified customer measures into account. Customer satisfaction. Likelihood to recommend. None are perfect but they are bringing the customer into the board room. Over time the most advanced companies are linking these measures together and correlating them with internal quality measurements and external commercial figures. It isn’t easy to do. But some companies now believe they can say what a percentage point on a customer scorecard is worth to the bottom line. 

The further battleground for these more advanced companies is how to change these scores. How to change the real commercial results through doing things that customers like. Yes, better experiences. But not at any price. In most cases the relationship between experiences, satisfaction, researched statements and actual buying behaviour are far from linear. And not the same for each industry or business within it. 

A major shift is happening. From measuring to understand what’s happening with customers, to simply listening to customers to know what to do. And next to listening to customers in importance is listening to front line staff.  So what is the role of the CCO? To get the arguments into the boardroom? To get the customer measures in place? Yes but there’s something bigger. The true CCO is the voice of the customer and the voice of the front line staff who know what customers know. The CCO’s job is deeper than measurement or argument. The job is to get the business to take decisions based on what the customer knows about your business. Frustrations, competition, opportunities. And when this happens shareholder results change. Markedly. Not by small amounts.

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Posted by: Peter Massey | 14.06.2007

I sit writing, bleary eyed, having just taken off from Milan very early this morning after an excellent night on the tiles at Stream’s annual user conference. The conference circuit has been taking its toll on my blogging of late….. In the last 30 days, its been ECMW, a telco CRM event in Lisbon, our own Chief Customer Officer forum, then Dusseldorf and Paris with LimeBridge external events, LimeBridge’s 10th global gathering. This week it’s been Milan and the British Bankers Association. Finally next week I chair Advanced Customer Management in London and the “season” finishes. I probably need to buy an acre of Brazilian rainforest to offset the flights and the midnight oil that has been burned.

There’s at least 10 blogs to back date from the interesting things I’ve heard people talking about, Prahalad, Eisner. Updates on how LimeBridge is jumping to its next iteration etc – I’ll catch up at the weekend….may be.

What just caught my eye was an article in the FT titled “In the pursuit of happiness”. The story goes that the long held premise that happy staff make happy customers is not backed up by the evidence. Crumbs, I just noticed I know the journalist – will have to shoot him – Alan I know where you live !

On the conference circuit I’ve been talking a lot about our passion of “how do we stop doing dumb things to our customers and people” and trying hard to get people to feel the feelings that customer facing staff feel when they deliver dumb things in what we call the “stupid factory” of poor processes. How it feels when they are not supported by management, and worse when they are controlled by management practices and measurements. And how they perform when they are supported rather than managed (see the blogs on red nose day, and on the 4 questions that Happy use). I’ve been working hard to recognise that change in attitudes starts with them, not someone else. How they respect people by saying hello in the morning, how they listen to their frontline staff who know what customers are saying. How they are as managers and designers of the operation around them.

There’s also a fundamental that people won’t get off their backsides for money, to make shareholders another million. But they will for a real purpose, for a passion that matters. When we did the CCO forum we calculated that about 30 million customers and 90,000 staff would be affected by how the influential people in the room drove their businesses – that matters. Not how much more money their businesses would make as a result. I realised I had to shout this from the roof tops when I heard a colleague of mine say he thought our passion didn’t make our sales proposition clear. Bollocks to propositions, its not about business – its about how frustrated and fed up we’re making those 90,000 people and 30 million customers. And how quickly can we stop it happening.

So as you see the FT article got me going! It refers to the seminal HBR article “The Service Profit Chain” (you can read it in our library at http://www.budd.uk.com/ ) and how the authors now admit its not that direct a linkage from satisfied staff to satisfied customers to higher profits. That’s its not that linear. Of course it isn’t. But that doesn’t mean that happy staff don’t deliver better results.

The article falls into the trap of measuring results only in shareholder terms ie profit. 21st century business is also about measuring social returns on customer time wasted, staff lives wasted and natural resources wasted from paper wasted on junk mail to midnight oil burned trying to get your laptop to work with all its new software and PDAs and printers. This matters far more to people. It gives purpose to what businesses are for.

In fairness the article does touch on the need for both dimensions, the process and the motivation, to be right in order to deliver a good result for customers. And it emphasises a key thing – that workers should redesign work, not managers or consultants. They already know what’s broken – you just have to free them to change what happens. It’s managers “managing by getting in the way” LINK that’s the problem with the Service Profit Chain logic, not the service profit chain itself. And the article does emphasise the Gallup 12 questions ( see previous post) bringing out that its your direct manager who affects most how you feel and therefore how well you perform

Alan must have been reading our blogs when he put his FT article together, given all the things he mentioned!!

Well that’s another half hour lost to ranting, but I feel better for it! A bientot

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Posted by: Peter Massey | 9.02.2007

Are you the CCO? WOT????

Well a CCO is a “chief customer officer” - the person who screams, scratches, bites and kicks the company to make it better for the customer. The one who “stops dumb things happening to customers” !! You may have a rich seam of them in your business or be a lone star

Of course given our mission of “how do we stop doing dumb things to customers” we are mad keen to meet and help as many CCOs as possible.

So two things are in train and we’d love your input (email me on peter.massey@budd.uk.com)

1) March 21st is a directors’ breakfast seminar being jointly hosted with the heroic CCO Darren Cornish from Norwich Union. It will be a couple of short blasts on the horn from Darren and I, then facilitated discussion of what it takes to get your organisation acting on all the wonderful feedback customers give ( expletives deletives or whatever !)

2) Our 2007 4th annual Fast+Simple survey will be kicking off shortly and we’re looking for chief customer officers and their CEOs to interview

Elect yourself to the role of CCO and get yourself a seat at the table !

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