Last month I delivered a keynote speech to a group of business leaders in Athens, Greece. The HMA had adopted the concept of replacing the old concept of trying to do “more with less” with the concept from our book, “doing more ON less.” I loved the signage for the event. The concept of “more with less” is completely overused and in crisis situations just results in lots of under-funded activities, diffused leadership attention and gridlock of any progress. Doing “More ON Less” is about reducing the focus to the highest impact activities, concentrating funding on those items and focusing leadership attention on just a big initiatives. Here is how the idea of transforming through “More ON Less” could be applied in Greece today.

It was very interesting in preparing for the speech to apply this concept of transformation through focus to such a complex, broad and pressing issue as the Greek economy. Through interviews, research and using some full-system assessment models to understand the best assets to leverage in a transformation, I would suggest three transformation initiatives to consider for Greece.

1) Innovation: Build an innovation cluster and engage younger talent in building new businesses in Greece. There is a disproportionate level of unemployment of youth in Greece today.This would require alignment across silos of business, investors, educational institutions and government policies all targeted at encouraging and enabling entrepreneurship.

2) Industry Clusters: Greece has several industries that compete well on a global scale. Recently, too much of the economy was based on government spending and domestic business. Specifically focusing on advancing industries that drive international revenues for Greece should be the focus. This may include leveraging shipping further as well as the technologies that are being adopted by that industry (e.g., software, RFID). Gaining a greater market share of cruise embarkations in the Mediterranean is another potential focus area as well as building share and keeping more margin for key food products such as olive oil (#3 producer in the world, but a majority is sold wholesale at lower margins), yogurt and feta cheese.

The More ON Less play here would be to create business-led groups that would include the full economic ecosystem of major international business leaders, regional business leaders, government officials, investors, educators across these sectors and fast-tracking a small number of initiatives to accelerate growth in those market areas.

3) Tax reform: There is a downward cycle of high taxation rates and low collection enforcement that has been causing much of the deficit spending in the government. The upward cycle would include a focus on three areas: increasing tax collection enforcement, providing business tax credits for growing new businesses and jobs, and encouraging export related business expansion to strengthening core industries to drive greater revenue (and thus taxes).

Even if these are not the final set of initiatives, the overall key to unlocking the turnaround of the economy will be to get tightly focused on a few initiatives that business, government, civic, education and other leaders can agree to implement in alignment with each other and with great speed. Transforming the Greek economy may not be simple, but applying the simple concept of focusing on a few key initiatives and doing “More ON Less” would certainly be more effective at turning the trends rather than simply more austerity cuts and cries to try to do “more with less.”

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Free mini-ebook on Customer Experience

At a recent inaugural meeting of the Customer Experience Professionals Association (CXPA), a group of professionals in customer experience, including executives from Cox Communications, Sprint, Fidelity Investments, and UPS gathered in Boston to discuss the latest trends and tools in the field of Customer Experience.

One of the top unanswered issues was, “how can we get Customer Experience to be on the strategic agenda for CEOs and other top executives?” Some people were concerned that the tactics of re-engineering customer service touch-points might overshadow the strategic value of creating a customer experience that is amazing, unique and memorable and drives revenue growth, premium margins and customer loyalty.

This month, ChangeThis published a manifesto, “Putting a Signature on Your Customer Experience” which hits on two specific ideas and frameworks for framing CX as a strategic issue. Since merging a strategy/transformation firm with a brand/marketing firm two years ago, we’ve been working with companies looking to differentiate and spark new growth based on customer experience strategies that drive transformations in performance.

This article captures the essence of the best innovative thinking from that work and is a blend of design and strategic business thinking that generates innovative growth strategies, inspires employees to deliver greatness, and drives customer loyalty and evangelism. I hope you’ll find that the mini ebook holds useful keys to unlock the full value of doing Customer Experience work at a strategic level.

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Mobile devices are now a core part of customers’ daily lives and therefore potentially a core part of almost any customer experience. Similar to company web sites offering up a new facet of customer experience in the early 2000s, mobile devices have the potential and will become another unique experience element of equal or more impact.

In the fourth quarter of 2010, IDC reported that there were 92.1 million traditional computers sold and 100.9 million smart phones. Smart phones and tables have now become a core part of the overall customer experience between companies and their customers. Even if you do not have a mobile device customer experience strategy, customers are hitting your current website from those devices or are calling your call centers from those same devices in greater numbers.

Mobile sales and service apps should be considered a core channel for both consumer and B2B markets today. CMS Wire polled readers to test just how important mobile channels were as compared to web and other channels. Over 28% of people noted that mobile had become as important as web channels (full article). Different than bricks (physical channels) and clicks (web sites), which took a decade to evolve into  integrated cross-leveraged channels, mobile is on a faster pace because it is jumping off from where web services have left off.

One example is Redbox’s Android app. With this app you can pre-order a movie to be picked up at a particular Redbox kiosk in a store. This is a fairly traditional e-commerce extension to mobile, but is interesting in that it allows a new level of access and convenience on a purchase that is more impulse and convenience-driven than other online purchases.

In addition, mobile apps can enable new service conveniences. I almost feel bad constantly using Apple as a shining example of innovation, but they just keep getting customer experience innovations right. In this case, an Apple Store app allows customers to access information real-time about wait times, appointments and workshop start times. Especially during busy times, this helps customers plan their time and puts them more in control of the service experience.

Mobile apps have moved well beyond marketing gimmicks and into core commerce and service applications that directly tie into the overall customer experience. The market leaders will not simply replicate their websites in a smaller screen format for mobile devices. Mobile devices can generate new and unique signature customer experiences that even more closely integrate the real-world experiences (retail store or kiosk) with the online experience. As you begin to think through how to integrate mobile customer experience into your web and physical customer spaces, think about the following questions and what signature elements you might be able to deliver to your customers.

- What real-time data would be personally useful in a customer environment?

- What conveniences can we create for customers by allowing mobile access to transactions, information and services wherever they may be?

- How can customers control or shape their own experience in a business or retail environment by having access to applications that they can manipulate and control?

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For me, the question of how much to spend on customer experience is a trick question. Customer experience is an investment and can be an asset. It is not always viewed that way, especially when revenues lag and there seem to be unnecessary costs that could be eliminated with no immediate and direct impact on revenue. A great example are the Nordstrom piano players.

Just recently, my local Nordstrom re-designed their escalators and designed out the grand piano area. I had heard that Nordstrom was eliminating piano players, but thought it wasn’t wide spread until it hit home in my own shopping experience.

For several years I have been quizzing audiences when talking about customer experience on things like, “which retail store has a grand piano player?” Brand recall is amazingly high for the Nordstrom piano players and people always get this right away. The person answering usually has a big smile on their face and often follows up with a positive comment about the experience.

In my work with management teams, we refer to these types of customer experience elements as Signature Points. That is, an element of the customer experience that brings the entire brand to life in an experiential way. Signature points are authentically delivered, consistently executed, and perfect demonstrations of a company’s brand differentiation. These are hard to find and establish, and very hard for customers to forget. That is why it was so surprising to see Nordstrom drop this Signature Point.

Searching online for some customer perspectives, I found these two contrasting points of view. One is from a customer and one is from a retail analyst.

Customer:

“I, for one, am shocked that Nordstrom has decided to do this. For me, live piano playing is the hallmark of the Nordstrom brand. Without it, I might as well shop at Macy’s.”

Analyst:

Black, the retail analyst, said she’ll miss the piano music, but the public company must consider profits before ambience. “We’re heading into a tough retail environment, and all retailers are cutting expenses,” Black said. “It’s nice, but I don’t think it’s necessary.”

I have a tremendous amount of respect for Nordstrom’s management team. I hope that their choices on this move truly represent more of a shift in customer sentiment and expectations rather than just cutting costs. The customer quote above painfully hits home on the point that the details of a customer experience can make all of the difference in a tightly competitive world. The piano player was a touch of elegance and refinement that you don’t find in any major retail chain and really set the Nordstrom experience apart from the crowd.

In the end, eliminating the piano players may allow Nordstrom to extend into a new positioning with a new demographic. However, I’ve read that the core Seattle stores are keeping the piano players while others are dropping them. So, one way to think of this is in eliminating expenses; the “cost” of selling floor space used for a piano plus the compensation to the piano players. That’s fairly easy for an analyst to calculate. On the other hand, this move may “cost” Nordstrom a highly memorable and meaningful source of differentiation from Macy’s. The ultimate cost of that move is hard to calculate and may be much larger than the expense calculation.

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Innovative thinking is a highly valued capability today. By working specific mental exercises as a deliberate part of your day, you can increase your ability to integrate left brain (creative) and right brain (logical) thinking patterns into a mix that generates more productive innovative thinking.

Any edge to think and act with more agility, innovation and creativity is highly valuable. An article on the LIVESTRONG blog recently shared some practical exercises you can use to build your abilities to integrate right and left brain thinking. This enables you to be a source of innovative ideas that can be implemented in practical ways or to generate creative sparks at the right time while implementing structured processes.

We tend to categorize employees, and sometimes ourselves, as being either left brain OR right brain driven. But the most effective people entrepreneurs and business leaders actually work across both worlds of being wildly creative at one moment and then thinking in painstaking detail the next. Some famous business leaders who are known for this ability are Steve Jobs (Apple), Micky Drexler (The Gap), and Bill Gates (Microsoft). Those leaders are able to modulate between far reaching visions for their companies and then down to specific design and technical details seamlessly.

My experience working with transformational leaders who are able to successfully spearhead strategic big ideas and have those executed by large teams to generate big results, share these same capabilities. It is a leadership capability that can be improved and honed. The specific exercises in the LIVESTRONG post are some of the most interesting and practical I’ve seen. Try a few of these next time you are stuck in an airport or are stuck trying to find a solution to a tough problem. These exercises will connect the two sides of your brain and will enrich and expand your ability to generate practical and innovative solutions.

Left Brain - Right Brain Exercises

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Very often I am asked, “do we really need ‘every’ department to participate in our customer experience initiative. My quick answer is usually, “if a department truly has zero impact on customers, then maybe they should be eliminated or outsourced.” Many times this drifts into a follow up question to test the edges, “…well, what about our legal department for example.” I’ve seen this too many times and have a great recent example to share with you on why even legal departments can make a huge difference in customer experience.

Recently while booking a business trip, I found a good deal on a flight on my normal carrier, which is United. After booking it, I realized that the return date may need to flex and was wondering what any change fees or penalties may be for this potential change. That’s when I was hit with this perfect “Counter Point” example where legal language makes all the difference in the customer experience.

I clicked on the link labeled “fare rules” on United’s reservation website. United had a 13 page document that was too long to show as a full visual, other than as thumbnail images of the pages below. But to give you an idea of the confusing language, here are some quotes taken from the document.

This is all taken from the first page of the 13 page document, so it is not that I was searching for obscure references to make a point. This is right up front in the document.

“Transfers: 4 transfers permitted on the pricing unit - 2 in each direction fare break surface sectors not permitted and embedded surface sectors permitted on the fare component. Note - fare break surface sectors are not permitted.”

“Combinations: double open jaws not permitted. add-ons not permitted. end-on-end end-on-end combinations permitted. validate adjacent line of flight fare components only. Travel must be via the point of combination. provided - combinations are in any rule in tariff CPR - between the United States-Canada DFT - within the United States FBRNAPV - within North America VPCR…”

What are they talking about? And more importantly, will I get charged for changing my flights or not?

Here is the full online document that you get when clicking “fare rules” on the United site:

Suspecting at this point that Southwest Airlines, which focuses on customer experience, might have a different approach to fare rules, I searched on their site. I went to Southwest’s website, clicked on their “fare rules” link and got this….

This language I can understand because it has no airline industry jargon, is simple, and fast to read. It was clearly designed with the customer in mind. The design is aimed at ease of understanding for the customer, not a corporate shield to justify additional fees or to protect the company from people who may try to “game” the fare system. This makes me want to fly Southwest more. It makes me trust that I won’t end up at a gate at the airport trying to not look like an unruly customer while attempting to understand and argue arcane rules with an agent who equally has to try to type endlessly in their computer system to look for how the rules apply…and if I will be charged hundreds of dollars or nothing at all. This makes me feel that Southwest isn’t trying to push technicalities on me that will result in surprise charges. I trust them and they trust me not to try to “game” their system of fees.

United has very convenient flights, good core quality of services and comfortable seating (at least in Economy Plus or choice exit row seats). This post is not intended to bash United overall and certainly not the great people I’ve met who work there, but rather to point out such an important example of how a customer experience can be set up for failure by what many companies may believe is just a back-office issue of the legal department developing a fare rule document for the website.

When working on your customer experience, don’t overlook these critical points of interaction and keep a vigilant watch on your full set of interactions with the customer. Customer experience is not just about the direct customer service or sales interactions. Every department, even legal, can make or break your customer experience.

Image source: Fairrington

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You’ve just been handed the baton for improving customer experience at your company…now what?

The role of Chief Customer Officer (CCO), Chief Customer Experience Officer and other executive titles that revolve around strategic focus on the customer are some of the fastest growing titles in corporations today. But beyond assigning a top executive into the role of watching over customer experience, what should the capabilities of the CCO organization be and what should be their accountability? The leading customer organizations are taking on corporate challenges that require strong capabilities in strategy, marketing, creative and organizational transformation. Why are they building these diverse teams? What is the business value? And more importantly, how can you build a highly effective customer organization in your company?

Any leader overseeing a customer experience initiative faces some specific challenges. First, one of the aspects of customer experience is that it cuts across every functional or operational silo organization, making alignment and agreement on priorities extremely difficult. In addition, the people closest to customers who have great insight into the customer experience and are depended upon to engage customers effectively are typically in locations spread out the farthest from any central customer experience organization. This distance results in difficulty in employee engagement and communications across those teams that are most critical to be in alignment. The diagram below illustrates how each silo organization touches the customer in a specific part of their process, however what is often obscured in companies is that the customer’s view of the company is ONLY seen through those touch points of interaction (the blue dots). As the right side of the diagram indicates, there is nothing wrong with running efficient and focused silos, it is just also necessary to understand and align the touch points to deliver a consistent and valuable customer experience in total.

Illustration Source: Bedrock Consulting

The following description from a Chief Customer Officer at a division of Boeing describes the situation perfectly. In a  Forbes.com article titled “The Rise of the Chief Customer Officer,” Roei Ganzarski, the Chief Customer Officer for Boeing Training & Flight Services, explained the company’s realization to focus more on the customer as, “the realization that, in order to be successful, we needed to be more focused on our customers than ever before. Our organizational culture wasn’t optimal to say the least. Our operations departments were focused on our products, our finance teams on collecting payments and our sales and business development teams focused on meeting short term revenue goals. But no one was looking at things from the customers’ perspective.” According to Ganzarski, this meant they were working inefficiently and making it hard for customers to work with them. “We knew we needed to change our culture to better serve the one reason we all exist–our customers. That’s when we decided to create the role and align all the market-facing groups under it to change our perspectives and focus.”

Given the description of the business challenge, it is clear that a CCO organization or customer experience initiative goes well beyond the traditional customer-oriented projects in companies. Past customer projects may have included customer loyalty programs, voice of the customer research, customer relationship management, or customer service improvement. Those projects are still highly valuable, but they under-shoot the real need for solutions that will improve overall customer experiences. Customer experience initiatives or CCO organization charters are more about setting customer-driven corporate strategies that re-align investments and priorities across organizations as broad as products, operations, marketing, branding, sales and service.

To deliver this level of support to the company, a CCO organization requires a clear charter and competencies to deliver. The lists below are recommendations on what is needed to establish an effective and successful CCO or customer experience initiative team.

Charter:

• Define the best customer experience to support the company’s brand promise and strategic position
• Optimize and align the priorities across organizational silos to serve a single strategy for delivering a great customer experience
• Engage all employees in staff, operations and front-line organizations in delivering the customer experience

Competencies:

• Strategic analysis and market research
• Creative, design, branding, and marketing
• Organizational transformation and employee engagement
• Operational planning, systems re-engineering and business process

The article in Forbes.com quotes another CCO of a major software company in saying that, “I worry about this as a role … it’s in vogue and many companies will hire one because they think they need one. In three to five years, I’m afraid we may see lots of flameout because they weren’t given the seniority or authority to make a difference.” To ensure your initiative or team does not suffer that fate, make sure that your charter is clear and you have the right mix of talent to deliver on this strategically critical mission.

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The field of Customer Experience Management is driving a new wave of innovation through businesses. Innovation is often about fusing different disciplines together to generate new ways of thinking and ways of solving problems creatively. A major innovation trend today is the mixing of business strategy and design to form new ways of thinking to create compelling and valuable customer experiences. In the past, designers and business leaders would go to different schools, work at different professional services firms, work in different parts of an organization and belong to different professional associations. They were completely separate sub-cultures of the business world. Today, leaders are mixing those two worlds and the result is greater innovation, better customer experiences … resulting in greater business success. Venture capital funds, top business schools, leading customer experience executives and innovative service firms are all moving to harness this fusion.

Recently, Dr. Tapan Munroe, a colleague who writes a column for the (SF) Bay Area News Group, wrote an article on innovative design. Tapan has worked, studied and written about global business innovation centers for years and has an uncanny ability to spot the new trends. In his article, he discusses a new venture capital fund, The Designer Fund, that has been created specifically to invest in companies with founders following a design-centric view to build their products and services. For the investors, this isn’t about a fad. It is about building successful businesses and making money. As examples, Munroe notes specific companies that were founded on design-oriented concepts to fuel their growth including; Apple, YouTube, Facebook, Twitter, Fickr and Vimeo. He points out that the products and services of design-oriented companies create an emotional bond between the product or service and the customer.

I was recently talking with the recruiting office of U.C. Berkeley to discuss hiring new MBAs for our firm. I have recruited MBA graduates from top programs for many years into more traditional strategy consulting practices and am very used to the profile of students and their interests. However, things were different this time. A year ago I merged my prior strategy and transformation firm with a brand and marketing firm to create Bedrock Consultants, a Customer Experience firm. We require people with a blend of analytical skills found in MBA graduates as well as the creative skills of design school graduates. We weren’t sure what the Haas program might have to offer.

Surprisingly, we found that the Haas Business School at U.C. Berkeley, one of the top rated MBA programs in the world, for the first time has made a unique “design thinking” course a mandatory element of the MBA curriculum. In addition, the Design Thinking club is the fastest growing new organization within the MBA student community. This was great news to us and for others who are building a talent base of people who embody the true fusion between business strategy and creative design.

As you build your personal skills or your team to deliver on customer experience initiatives, think about this fusion of skills. Most people, other than the rare types like Steve Jobs or Mickey Drexler (Gap), cannot have it all. So the challenge is to build a team of creatives who can truly understand how to analyze the voice of the customer research, sales data and other information to use as input into their designs…not just the qualitative types of inputs such as asking executive teams how they want their brand to appear or how they would describe the company if it were a famous movie star. Equally, you want to have strategy and product management team members who can look beyond just market size models, heat maps and supply chain cost estimates to target customer solutions that will incite an emotional connection with the customer.

BusinessWeek noted design thinking as “the hottest trend in business culture today.” They made that statement in 2006. And as Bill Gates once pointed out, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.” The statement in BusinessWeek in 2006 may be the overestimate, but the evidence of successful design-centric start-ups, business school curriculum at top programs, and the true merging of business and creative talent focused on Customer Experience is just beginning to take off. Don’t be one of the people to underestimate the impact it will have on business in the next 10 years, take full advantage of getting in front of it.

Image source: www.deborahshanetoolbox.com

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One of the best metrics for monitoring your customer experience value is to measure customer satisfaction. Most companies do that. Most managers also look at the combined top two scores on a five point scale that includes “very satisfied” and “satisfied” and as long as those two categories are at a high percentage of answers, things are viewed as successful. After viewing Apple’s performance in mobile devices in terms of very satisfied customers and market share growth, maybe we should move to a two point scale that only includes Very Satisfied and “Also Ran” as the only two choices. That seems to be all that matters.

72% Very Satisfied Customers

Being satisfied with customers who say they are just “satisfied” is not the way to achieve market leadership. With competitive intensity so high in today’s markets, the only relevant measure is to drive up business performance is to focus on creating “very satisfied” customers as a majority. The bell shaped curve is after all average, or otherwise a commodity. A recent report published by CNET (and conducted by ChangeWave) on customer satisfaction with the iPhone 4 experience shows that Apple has achieved a 72% very satisfied rating. That is a rare accomplishment and demonstrates Apple’s commitment to customer experience excellence. Not just mere average “satisfaction.”

115% Growth in Market Share

The result of having such high “very satisfied” ratings is that Apple’s market share of mobile devices grew by 115% in the first quarter of 2011 according to a new study from IDC Research. That is growing from a single digit market share base, but the company above Apple’s share fell by almost 10% in the same quarter.

When setting success metrics, the benchmarks you set should not be done in a way to make you and your employees feel good and satisfied that, “at least people don’t dislike us.” Set the bar high, customer experience is an area of the business that can’t merely satisfy, it needs to wow, surprise, and delight customers every day and at every interaction. The result will be very satisfied customers and market leading growth.

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In our strategic transformation work we are often asked the question, “why should we limit ourselves to just three major initiatives?” Executive teams feel that a short list of initiatives is not a stretch for the organization or that it is too limited to create transformational change. The truth is that when it comes to execution, transformational change comes from making major progress on a small number of things. It is about stacking up the resources on the most high impact initiatives that will have meaningful impact on customer value and the customer experience.

Harvard Business Review just published research from Booz Allen & Company that was based on a broad executive study of 1800 global executives. Here are some of the highlights for you to consider and to use with your stakeholders and team to make the case for focus.

* Most executives (64%) report they have too many conflicting priorities.
* The majority of executives (56%) say that allocating resources in a way that really supports the strategy is a significant challenge, especially as companies chase a wide set of growth initiatives.
* 81% admit that their growth initiatives lead to waste, at least some of the time.
* Nearly half (47%) say their company’s way of creating value is not well understood by employees or customers.

The reason we work with executives team to narrow the focus is that when it comes time to execute a plan, the issues of conflicting priorities, resource allocation problems (too thin across too many projects), lack of understanding by employees are all symptoms of trying to do too much at once. This leads to the research finding that “81% of executives admit that their growth initiatives lead to waste, at least some of the time.”

Doing More ON Less

One phrase for me sums it up. Stop following the concept of doing “More With Less” and replace that with the the concept of doing “More ON Less”. This means more resources, more executive focus, more communications around a much smaller and narrower scope. However, that narrow set of initiatives should be carefully selected as the ones that will have the highest impact on customers and business results.

For a step-by-step guide on how to implement a program to achieve this strategic focus and organizational alignment, you can read the book “BIG Ideas to BIG Results: How to Remake and Recharge Your Business, Fast” . It lays out the complete process, detailed examples, and tips for executing well. It is a simple and fast approach, but there are a lot of pitfalls along the way and bad habits to break that the book addresses. Dr. Robert Miles and I wrote the book specifically to help more managers have a roadmap for setting customer-driven strategies that are focused, easy to understand and concentrate execution resources to achieve the “big results”…which is really all that matters.

Chapter 6 in the book covers strategic alignment and below are the “Tips for Absolute Alignment” that we share in the book (source: Michael Kanazawa and Dr. Robert H. Miles, BIG Ideas to BIG Results, FT Press/Pearson Hall, 2008):

Tips for Absolute Alignment

Three transformation initiatives:

• Set three transformation initiatives and specify areas of focus and success metrics for each initiative.

Absolute alignment from top to bottom:

• Quickly address even the small deviations from the focus at the top as these get magnified going down - senior executives cast big shadows.
• Drive accountability throughout the entire organization through setting individual Commitments to Action at all levels.
• Restack all priorities top to bottom or you will, by definition, only be playing on the margins with incremental changes. This will make many people uncomfortable, but is necessary.
• Reset investment and operating budget levels to align with the initiative priorities.
• Establish clear guidelines for resource allocation that will enable you to quickly identify and kill the zombies before they kill your transformation.

Align values and behaviors:

• Select a few values that strategically align with the initiatives.
• Anchor the values in behavioral change commitments at all levels in the organization.
• Quickly address and handle any situations where leaders will not align fully.

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