Business leaders often ask me for examples of specific capabilities or values that can be built into an organization to optimize customer experiences, strengthen business relationships, and create marketplace differentiation. Here’s how your organization design and structure can enhance customer relationships in this first of a two-part series.
It is not difficult to find great examples of excellent customer service. Newsweek recently reported the results of its global research to find the “Best Customer Service Companies in 2020.” The top overall organization in the world for customer service was Disney Cruise Lines, whose customers rave about receiving “magical” service, far beyond expectations. With decades of creating marvelous experiences, Disney is widely regarded as the guiding light for customer service. Disney cast members are trained from day one to deliver an exceptional experience; and Walt Disney himself emphasized his customer-focused purpose, saying, “You reach a point where you don’t work for money.”
Most customers expect a high-quality customer experience. They are more informed, more inter-connected, more skeptical, and have more options than ever before, which makes it harder than ever to keep them. At the first sign of a bad experience, customers can and will jump to a different option. Retaining customers and increasing their lifetime value to your business has always been a key ingredient of the most successful companies.
How Is Customer Service Influenced by the Organization’s Culture?
While an organization may seek to differentiate itself via the customer experience, it takes a strategic approach to win in the marketplace with this capability. In some markets, excellent customer service is the price just to remain in the market; simply “striving to improve” is not enough.
To improve customer service capabilities, it is important to understand the origins of the organization’s culture. Culture is, in fact, a reflection of the culmination of choices made by the leadership team. In Mastering the Cube, we define culture as an organization’s assumptions, beliefs, values, and norms.
However, when employees see a disconnect between the values their leaders espouse and management behaviors in their workplace, the employees are apt to perform their work in ways that will sync with their perception of the goals of the organization.
For example, while one company’s executive team regularly stressed the importance of excellent customer service as one of its top differentiators, the leader of a department with significant customer interaction often demonstrated indifference and even disrespect toward customers. In turn, the employees within that department felt no sense of urgency in responding to customer needs. In the meantime, the executive team seemed baffled by the large quantity of customer complaints and the frequency of escalated customer issues. It does no good to proclaim excellence from the rooftop when the foundation is weak.
As an organization’s choices are derived from its strategy and capabilities, how well these are aligned will, in turn, influence the organization’s culture (its assumptions, beliefs, values, and norms). The culture, in turn, influences future decision making, which then drives more choices. Organizational culture is self-reinforcing and difficult to change.
Five Ways Leaders Can Intervene to Optimize Customer Experiences
From an organizational design perspective, if a business wants to deliver a profound and differentiated customer experience, leaders must ensure that the commitment to customer service excellence runs wide and deep throughout the organization. Many business systems, processes, and other choices must be aligned and focused on delivering this specific capability. You should ensure that the following aspects of conducting business are aligned with your strategy and capabilities:
Make organizational structure choices that best amplify the customer experience. If the customer experience is to be one of your competitive advantages this is critical. This can be accomplished by elevating the leadership of customer care to an organizational level that is commensurate with how effectively your customer experience delivers competitive differentiation.
In one example, a global company I recently worked with wanted to enhance the customer experience as a competitive differentiator. The business leaders chose to intentionally keep customer care (including developing, training, and monitoring customer interactions) as a part of its operations function. In addition, it was determined to also maintain a separate, stand-alone customer experience function. These choices, for this organization, heightened awareness, understanding, and accountability of the customer care teams working on the front lines.
Data and metrics should be utilized to determine whether you are improving or declining. The data should drive choices that will improve the customer experience. Organizations should seek to get actionable data (which is accurate, relevant, and timely) into the hands of leaders on the front lines, where it will be utilized to effectively solve problems and optimize customer experiences.
Adjust decision rights, if necessary, to protect the customer experience without assuming unnecessary risk. For example, a car dealership that has cultivated particularly loyal customers has authorized the service writers to prioritize and adjust service schedules to meet customers’ specific individual needs.
Leadership behaviors should demonstrate ways to optimize customer experiences. Additionally, leaders should recognize and reward their team’s best behaviors.
Determine new ways to use technologies and digitization to ensure a premium customer experience, As the organization develops new capabilities, integrate them in ways that enhance the customer experience.
An organization’s relationship with its customers will endure far beyond the value of product offerings or even customers’ perception of the products. The relationship is built slowly, must be secured deliberately, and can be destroyed quickly. The critical structural elements of building that relationship comprise the five essential business values of accountability, integrity, trust, mutual respect, and excellence. In next week’s blog, we will explain the important and significant customer impact of these five values. Read Organization Culture & Business Relationships, Part 2: Five Essential Business Values.
(Many thanks to Michael Page, Au.D. and business leader and consultant, for his insightful contributions about organization culture and business relationships.)