The 4 Keys to a Customer-Centric Culture

customer centric organizationRetail: Shaken Not Stirred reader Sarah submitted an interesting question for today’s post:

“What does it really mean to create a customer-centric culture ? We hear companies say it all the time. I would wager that almost every retailer claims to have it. But what does it really mean and how do you know if you really have it?”

Culture is a powerful and interesting beast, and I certainly don’t claim to be an expert in developing corporate cultures. However, it’s a topic of great interest for me, and I’ve had the opportunity to observe and operate within many corporate cultures. I’ve learned that corporate cultures cannot be decreed from the top as cultures get their power from all of the people within them. While CEOs and other leaders can be influential in culture development, they can also be completely enveloped by powerful cultures that are driven from all levels of the organization and formed over many, many years.

That said, I believe there are certain dynamics that drive cultures, and we can influence and shift cultures by focusing on these key areas.

Without further ado, here are what I believe are the four key facets of a truly customer-centric culture:

  1. Faith
    Customer-centric organizations believe in an almost religious way that sales and profits are the by-product of great customer experiences. They are unwavering in their belief that intense focus on creating the best possible experience for their customers is the best way to grow their businesses. Some of these organization will go as far as saying sales don’t matter, but that’s not exactly accurate. All businesses need to create profits, but truly customer-centric organizations focus on the customer experience and not on directly “driving sales.” They believe the best way to improve sales is to view them as an outcome of great customer experiences rather than something that can be directly affected.

    I once had the opportunity to meet with Yahoo and Google in back-to-back meetings regarding potential partnerships with my company, and the two discussions could not have been more different. The Yahoo team was very focused in determining how the partnership would increase Yahoo’s revenues while the Google team interrupted us immediately when we began to discuss revenue. They said they were only interested in opportunities that would enhance the Google experience for their users. Period. I didn’t take this to mean they weren’t interested in growing their business. They simply believed that Google’s purpose was to help people find all the world’s information, and they would maximize their revenue by delivering on their purpose in the best way possible for their users.

  2. Fortitude
    Relentless focus on the customer experience is not easy, particularly for public companies. Truly customer-centric organizations constantly have their faith tested by both external and internal forces who are looking for short-term sales or profits, even if those sales and profits might come at the expense of the customer experience. Customer-centric organizations focus on the value of a customer engagement cycle that relies on great customer experience as an engine that drives retention and positive word of mouth.

    There will always be pressure to run short-term promotion to goose sales. It’s not that customer-centric organizations don’t run promotions; it’s just that they run those promotions in context of their larger purposes in service of their customer. They focus on earning  sales and loyalty rather than buying sales and loyalty.

  3. Employees first (even before customers)
    It may seem counterintuitive to say customer-centric organizations put their employees before their customers, but in my experience this is true and this may actually be the most important of the four keys I’m discussing here. It’s a bit like when we’re instructed by flight attendants to secure our own oxygen masks before helping our children secure theirs. All employees play a part in the experiences we provide our customers. Some have direct contact with our customers and others make daily decisions that ultimately affect the experiences our customers have with us. Their attitudes about their jobs and the company can make or break the experience they provide for our customers. This is sort of obvious for front line staff like store associates and call center agents, but it’s also true for site developers, delivery truck drivers, mid-level managers, executives and, frankly, janitors. Even those not on the front lines are constantly making decisions that affect our customers’ experiences.

    Truly customer-centric organizations therefore provide absolutely great career experiences for their employees so their employees pass along the greatness to their customers. While decent salaries are certainly a factor, money alone is not enough. An “employees first” approach means employees are treated with great respect. They’re trusted with the authority to deliver on clearly defined accountabilities. They’re also given clear direction and clear guidelines and fully supported when they make decisions that improve the customer experience.  Colleen Barrett, President Emeritus at Southwest Airlines (a customer-centric organization), also points out that the customer is not always right. There are scenarios where the customer is clearly out-of-bounds and truly customer-centric organizations know when to support an employee over the customer. Watch a brief clip of her discussion at the recent Shop.org Annual Summit for some of her keen wisdom on empowering employees and defining an employee-first, customer-centric culture.

  4. They talk the talk and walk the walk
    As Sarah says in her question, most retail organizations profess to be customer-centric. Those that truly are customer-centric talk about customer experience internally exponentially more than they talk about it externally. Strategic and tactical discussions always center around improvements for the customer. These organizations measure the success of their businesses by metrics that represent the perceptions and voices of their customers. They spend a lot of time and effort ensuring these voice of customer metrics are credible, reliable and accurate, and they focus on them incessantly. These metrics are the first metrics that are discussed in weekly staff meetings from the executive level to the front line level. Bonuses are driven by these metrics, too, but the regular discussion of the voice of customer metrics and the drive to improve the experience on a daily basis is what separates customer-centric organizations from companies that discuss sales first and customer metrics later, if ever.

Are these attributes ideals for a perfect world that aren’t rooted in reality? I don’t think so. Organizations such as Google, Zappos and Southwest Airlines attribute their success to such thinking, and based on some of my experiences with them they seem to be living up to the promise. Is it easy? No way. While earning loyalty may not yield the immediate sales results buying loyalty can, the longer term efficiencies gained through providing great customer experiences can more than make up for the difference.

Those are my observations about customer-centric cultures. But as I said a the beginning of this post, I am not an expert. I’m very curious to hear from you.

What are your observations about customer-centric cultures? Have your worked for such an organization? Did true customer-centricity ultimately lead to solid financial results? What would you add to the keys I’ve listed?

(By the way, this is the first time I’ve had a reader submitted topic for discussion, but I would love to have more. Please email me at kevin.ertell@yahoo.com if you’ve got a topic that would be good for discussion in this space.)

9 Comments

  • By Sarah, October 7, 2010 @ 2:55 pm

    Thanks for writing a post about my question, Kevin. I was interested to see you mention employee satisfaction as one of your keys. Just the last few months, our local grocery store chain was sold to a national company who made changes that they thought would satisfy customers (longer hours, more products available, etc). But something has changed in the corporate culture and the employees are now miserable. Shopping there is a less enjoyable experience just because the enployees play such a huge role in the atmosphere of the store. So the store did make customer-centric changes, but didn’t quite hit the nail on the head. I hadn’t thought about it in terms of employee sat leading to customer sat, but it definitely does.

  • By Anna Barcelos, October 7, 2010 @ 7:30 pm

    Kevin and Sarah – Excellent points! I just finished reading CustomerCulture by one of the founders of FedEx and their company operates spot on to this blog post. Their employees first, customers second and both form this spiritual culture that’s made the company accelerate from its nearly bankrupt beginnings to the #1 transportation company it is today. Love reading posts like this!

    @abarcelos
    #IMCChat co-moderator

  • By Kevin Ertell, October 8, 2010 @ 8:56 am

    Thanks for your comments Sarah and Anna

    Sarah: First of all, thanks for submitting the great question. Second, I love the story you’ve relayed here about your local grocery store. Your point about employees affecting customer satisfaction is such a good one. Maybe there’s a whole blog post on how employee satisfaction leads to customer satisfaction. I’ll have to do some more thinking on that one.

    Anna: Thanks so much for mentioning CustomerCulture. I hadn’t heard of the book, but I downloaded it after reading your comment and started reading. I just started, but I can already tell I’m going to love it!

  • By Pranav, May 31, 2011 @ 12:21 am

    I am feeling good to be part of this discussion.How customer centriciy can be ahieved through training in retail scenario.Request you to share some book,methodology…

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