A current survey of CEO’s would confirm the view that future growth must come from getting back to the business of attracting and satisfying customers better than their competitors, with the ultimate goal of driving profitable topline growth.

In our consulting work we are increasingly having conversations with clients about the concept of being customer centric, and what it would mean for their business.

The Global Financial Crisis (GFC) has only highlighted this fact, and meant that in the post GFC environment the previous pathways to profitable growth of cost cutting, and merger and acquisition activity will no longer be the panacea they once were, and that the focus must now be on organic growth strategies.

Yet sadly, the idea of customer centricity may well be a short lived fashion, falling foul to the litany of management buzz concepts that have come and gone (or simply being oversold or poorly understood by the consulting organisations espousing them).

So what is are the characteristics of a customer centric company? And how can they be sustained?

At GSG, we observe that a key characteristic of high performing companies is a strong orientation towards bringing the customer view to most business decision making, particularly for more complex organisational brands such as retailers, banks, airlines and telco’s.

In simple terms, customer centric organisations constantly live in the world of their consumers rather than their own, and commit to the discipline of reviewing key business decisions in the context of what will this mean for their customers, and not just what will it mean for their profit and loss (read financial analysts).

Perhaps some old and new examples serve to illustrate these organisations.

Companies like Walmart have long lived in the world of their consumers. Sam Walton’s now legendary management of walking around his stores meant he had constant feedback (from both staff and customers) on how they were performing. No surprise that Sam could tell you what his customers were thinking and doing anytime of day so that, in the cut-throat game of retailing, he had a unique insight into the potential impact on his customers and their shopping behaviour of his own company’s decisions and those of his competitors.

At the end of the day, Sam knew what was good for his customers was good for his business.

More recently and more locally we have evidence of two strikingly different examples in the same industry; one claiming it as a brand virtue, the other living it through their brand behaviour.

Post GFC, we have seen some rather puzzling marketing behaviour in the banking industry, reinforcing the continuing view that our banks have still to understand what it is to be customer centric.

NAB has quietly been reading its customer research and courageously making decisions that its customers have long been asking for, decisions such as abolishment of “customer hate” account overdrawn fees. In the short term this may cost NAB bottom line performance but in the future is likely to attract loyal, premium paying customers and reinforce the loyalty of their existing customers.

Contrast this with the recent marketing promotion of another leading bank - an aggressive campaign rather self righteously claiming they live in the world of their customers. A campaign that is not supported with any meaningful customer based benefit other than a rather hollow claim that its customers will encounter a better experience based on tracking research they have conducted.

A classic battle between proof and promise, benefit and claim and insight and insult!

We will watch with interest how this plays out.

In summary, being customer centric will not be the panacea to the “New Growth” challenges our Chairman Kevin Luscombe has written about in our last newsletter. Just as the concept of brand should be viewed as a whole of organisation concept, so too should the concept of customer centricity. If companies take the simple steps of understanding their customer needs and using this knowledge to help inform their strategic decision making across the whole organisation, they will be a long way down the pathway to profitable growth......and being customer centric.

To be customer centric demands a commitment, a discipline, a whole of business mindset. It is all too easy to weave the customer centric language into company reports, mission statements and PR briefs.

But to be genuinely customer centric is a major investment, not so much in dollars, but in the execution needed with constant management attention to living the belief. This means in performance goals, measures and rewards, in staff selection and development, and in the realities of day to day behaviour from the top down.


Principles for a Customer Led Organisation

1. Top down (senior level) direction around customer centricity as major driver of business decisions for improved financial outcomes.
2. Established ‘customer insights / intelligence capability - able to be understood and leveraged across organisation for strategic focus and prioritisation.
3. Wide series of inputs to inform opportunity identification/monitor progress - suppliers, staff, channel partners, consumers, community involvement (staying close to the next marketplace)
4. Very accessible website, with clear invitation for consumer dialogue (product/service information, ideas, product performance playback)
5. Clear and shared understanding of what customers are being targeted, what matters, how they buy?
6. Shared view of brand strategy - what brands stand for, unifying purpose and understanding across and down the organisation
7. Customer understanding and perspectives integrated into key executive decision making forum(s).
8. Business improvement agenda set by key drivers of customer satisfaction and linked to commercial outcomes between sales/marketing (and supporting KPIs/metrics)
9. A disciplined approach to 'research briefing' including a clear view of what business decision is to be informed by the research and a systematic approach to leverage past insights
10. Brand metrics linked to consumer behaviour and business economics