The past few years have seen a notable shift in emphasis from products and services to customers. Many business leaders I meet recognize that a great customer experience begins with their employees.
However, these executives also realize that their traditional organizational structures can’t deliver the kind of customer focus they need. All too often, individual functions like Finance, Marketing, IT and others have independent, internal goals that are not aligned and can even be in conflict.
That’s why more and more businesses are transforming in order to get closer to the customer, by breaking down ‘silos’ and organizing themselves around the customer, uniting the front, middle and back office.
Working with many leading companies, I’ve observed that top performers – ones that have made a successful transition – understand that the employee experience precedes the customer experience. They frequently have strong people policies and are considered a ‘great place to work’.
An enabling culture
Customer-centricity demands a culture in which employees actively want to please the customer – rather than just feeling they ought to – so it’s not surprising that organizations that provide exceptional employee experiences also deliver great customer experiences.
Despite this clear connection between what organizations want for the customer and what organizations want for their employees, according to a global KPMG International survey of HR leaders, many companies are falling short. Just 50 percent strongly believe employee experience is valuable to the organization, and only 25 percent say it’s a top initiative. A mere 16 percent of senior management has made employee experience a top priority for HR.
It’s no surprise, then, that traditional top-down communications afford junior employees – the very ones who know most about customers’ needs – little chance to relay their insights to the C-level. When they try to pass on negative customer feedback, the message often gets diluted or fails to go beyond middle management. Opening lines of communication and allowing employees to share good and bad news is a significant step towards an accountable, customer-focused organization, where workers know that their views are listened to.
A starting point for senior executives is to ask themselves whether internal procedures or regulations are shackling employees’ efforts to serve the customer. A luxury hotel group lets every employee spend up to US$2,000 on solving a customer problem without having to seek managerial approval. Such empowerment can motivate employees to instinctively take the initiative to solve customer problems.
In order to shift a culture, senior executives need to really understand why employees behave the way they do and address root causes. Armed with this knowledge, they can then determine how to ‘nudge’ the culture in the desired direction, by adjusting factors like organizational structures, information transparency, role models, freedom to make discretionary decisions, and so on. All of this calls for behavioral insight and systems thinking skills.
Thinking like a customer
Energizing your customer-facing employees is a great start. But to get the entire organization working towards a common goal, I believe that all employees should have a line of sight to the customer and understand how they can make a positive impact.
One media company is challenging employees to look beyond key performance indicators (KPIs) to discover how customers perceive service levels, by carrying out an internal marketing campaign with videos featuring on-air talent working alongside back-office staff. The message is clear: everyone should focus on the customer experience and each employee can make a difference.
In another example, an American financial services provider, serving a specialist customer segment, encourages employees to become intimately familiar with their customers’ lives. The company recruits customers as employees and encourages its people to undergo basic training in their customers’ professions, to gain a level of empathy and insight that few competitors can match.
Social media has created multiple opportunities to interact with customers, and customers have shown a clear willingness to discuss their relationship with the brands they use, providing vast amounts of potentially valuable data. All employees should be encouraged to keep up with emerging platforms and technologies, to ensure they’re in touch with changing behavior and attitudes.
Celebrating the right behavior
The way employees are assessed and rewarded has a huge impact on the customer experience. This means placing the long-term relationship with the customer at the center of every role, with metrics like customer lifetime value, revenue from repeat business and customer profitability. In addition to these quantitative measures, skills like listening, empathy and rapport should also be valued.
What all the organizations I’ve mentioned have in common is a recognition that the customer is now in charge. Unfortunately, there’s a long way to go before this concept becomes embedded in every corporate culture. Only a talented, fully engaged, customer-obsessed workforce can provide the kind of experience that today’s consumer expects.
For more detailed insights on how employee experience can drive better customer experiences take a look at our report.