Turning occasional customer-centricity successes into a long-term, core driver in how you do business requires that the philosophy permeate every part of your organization.
Customer experience has become a key focus for companies in every industry. Business leaders understand that there’s long-term value in being customer-obsessed—and significant risk in failing to be. Our research has consistently found that organizations that lead in delivering superior customer and employee experiences also outperform on both growth and profitability. For instance, our evaluation of more than 125 companies found that a sizable majority (90%) of companies with strong capabilities in gathering and acting on customer experience (CX) and employee experience (EX) insights reported higher profitability and revenue growth than their industry peers. The push to become customer-centric is even more important as companies rethink their value propositions and business models in the wake of the COVID-19 pandemic.
But the devil is in the execution. Companies often achieve customer-centricity on specific projects here and there, but fail to make it a long-lasting priority across the entire organization. In other words, they fail to embed customer-centricity into their culture. We believe three main factors have contributed to the challenge of making customer-centricity stick.
Customer experience is viewed too narrowly. Customer-centric initiatives often focus too closely on the CX without considering how the EX and the leadership experience (LX) enable and influence the CX. These different forms of experience (CX, EX, and LX) reinforce one another so strongly that we advocate for an approach to culture activation that ties these three elements together. Improving customer touch points (e.g., self-service websites or redesigned apps) is a big part of improving CX, but employee behaviors are the real driver of good CX. When employees feel good about what they do and are empowered to act in ways that directly improve the CX, they gain motivation and pride, and help to power up the movement. EX and CX essentially create a continuous circle of good feelings, or emotional energy.
Ownership issues create confusion and impede progress. Efforts to improve the CX are often ad hoc, stand-alone projects that remain too siloed to be widely effective. They might be pursued as parallel but separate projects by leaders in various functional areas, rather than as complementary or overlapping projects. The lack of clarity with respect to ownership can pose barriers to acceptance and implementation of culture change. In reality, there are many owners of CX and EX across the enterprise, and it’s this broader view of ownership that helps to truly embed culture change in an organization. Greater clarity might be needed on how to carry out CX initiatives in a coordinated way that expands the circle of stakeholders and fosters a collaborative, cross-functional approach to helping culture change stick. The goal is to catalyze a movement that will take root and grow on its own—in other words, to make culture change “go viral.”
The current culture may be undermining customer-centricity initiatives. It’s difficult to rewire behaviors and create new habits if you don’t understand how the current ways of working may be at odds with your CX efforts. If there’s a disconnect between the internal messaging about being customer-focused and an employee’s actual on-the-job experiences, it will be difficult for customer-centric behaviors to take root.
We believe the way to fix these issues is to systematically activate customer-focused behaviors throughout the organization, calling on key people leaders to drive the effort. These leaders—who might be managing a sales team or supply chain, overseeing manufacturing operations, or supervising a credit department or call center—are essential to the adoption of the behaviors because they are on the front lines (and in the back offices) with employees and therefore wield everyday influence. We at the Katzenbach Center—a global institute for organizational culture and leadership at Strategy&, PwC’s strategy consulting business—call the important behaviors the “critical few behaviors” and the leaders who promote the behaviors “authentic informal leaders” (AILs).
