Crack the Code: Let's get Customer Obsessed

In the world of Customer Experience (CX), you often hear the terms "customer-centricity" and "customer obsession" used interchangeably. Typically, I'm not too hung up on the labels used for efforts to enhance customer experiences and loyalty. After all, even scholars can't seem to agree on a definitive meaning for customer-centricity.

The Idea  

But, in this particular case, I believe it is crucial to recognize that customer-centricity and customer obsession are not the same. This isn't a notion I conjured up overnight. I caught the customer-obsession bug on a Tuesday in November 2016.

I remember the day vividly. It was an unusually warm and humid autumn morning in London. A delayed bus service made me slightly late for a CX conference—but I just managed to catch the opening keynote address. After sprinting from the bus stop to the venue, I found myself in the back row, struggling to shift my focus from my sticky shirt to the speaker.

But he immediately captured my attention with a slide showing a single number: 3%. According to his agency's research, only 3% of businesses are truly customer-obsessed. I didn't believe the figure for a second. It didn't align with my experience and the data from numerous CX surveys.

Yet, the agency regularly repeats its analysis and consistently reconfirms its estimate. Could I be wrong? I have access to our own CX Index database for the analysis conducted here at Ennova. Analyzing the best 3% would mean a CX Index marginally higher than the top 10%. The data is simply not that dispersed. I can't say that moving from the top 10% to the top 3% is a true indicator that a business has elevated itself from merely customer-centric to genuinely customer-obsessed.

However, I have let go of my doubts about the accuracy of the 3% and shifted my focus to what the 3% represents. It represents an idea—a bright idea, in my view.

You see, customer obsession goes far beyond customer-centricity.

Slightly oversimplified, customer-centricity is something you add to what you're already doing. It's about tactical choices.

Customer obsession, on the other hand, defines who you are as a business. It's about prioritizing the needs of customers in every decision and action. Customer obsession is a strategic choice, one that permeates every nook and cranny of your organization.

You might dismiss all this if being customer-obsessed didn't impact your financial outcomes. But unless you have a monopoly, it will. Being customer-obsessed significantly enhances your ability to outperform competitors. Returning to my obsession with data, multiple studies have documented a clear link between financial success and being a leader in customer experience within your industry.

The Catch

So, it’s easy-peasy then. Become customer-obsessed and golden days will follow.

Or is it? Here’s the catch: it’s exceptionally hard to get there. The CEO might decide to make the strategic choice for the business to become customer-obsessed, but it will be a transformative change for the entire company.

Fortunately, a bit of desk research can guide you on what to do. Here, for instance, is an excerpt from a global consultancy, whose expertise I hold in the highest regard:

To develop a customer obsession strategy, you must first align your organization’s processes, talent, culture, structure, technology, and metrics with customer-centric principles. When you prioritize your customers’ perspective, leveraging data-backed insights to power decision-making, your business will be poised to operate with greater speed, agility, and connectivity. But adopting a customer-obsessed model is not a one-size-fits-all endeavor. Your organization is a unique entity with its own set of resources, priorities, and constraints. You need to understand the various nuances of each to determine what operational changes to implement to achieve true customer obsession.

Phew, quite a task at hand. It will likely feel a bit like trying to pick up every citizen of London in one big old red Routemaster diesel bus—one of those with an open back where anybody can easily jump off if they don't like the direction.

But that’s not all. As you hop along in the old red London bus toward the glittering marble halls of the Customer-Obsession Club, you must also shift everyone's mindset, according to the agency:

Move from “what we do” to “what our customers want”.

Move from your process to the customer’s process.

Move from focusing on one stage to the entire customer lifecycle

Ready, set, go?

They’re not wrong. It’s sound advice. I can't improve on it—far from it. But I worry: is it such a humongous task that the likelihood of failure is too high?

I could be completely wrong, but if I wanted to join the huffing and puffing old Routemaster bus to the Customer Obsession Club, I would focus on one word out of all the things they say:

Culture!

I think most business professionals would agree that managing corporate culture is key to business success. As Peter Drucker famously said, "Culture eats strategy for breakfast." Yet, few companies (perhaps the magic 3% that are truly customer-obsessed) can articulate their culture in such a way that it becomes an everyday reality for their employees.

In most well-run businesses, you can find multiple 'pockets' of customer-centric behavior. For example, an online customer service unit in a production company or a maître d'hôtel running a smooth customer experience at the hotel's reception. However, businesses are only truly customer-obsessed if this mindset is embedded into the corporate culture, encompassing everyone in the organization—not just specific units or individuals.

Yet, cultural transformations are inevitably difficult. I can't help you here; I am not an expert in cultural or organizational transformations.

The Path of Dilemmas

Enter Erin Meyer. Her approach might favor the odds of your customer-obsession endeavors succeeding.

Erin Meyer is a Paris-based INSEAD professor specializing in organizational culture. In 2023, she was listed by Thinkers50 as one of the fifty most impactful business writers in the world. She has just published a very insightful article in the latest HBR Magazine, Build a Corporate Culture That Works.

In her article, Erin recounts a compelling story from her time working for the healthcare-software specialist HBOC. HR had plastered the cafeteria with posters promoting the company's values: "Transparency, Respect, Integrity, Honesty." Fast forward a year, and the company's management was indicted on 17 counts of conspiracy and fraud. Not everyone in the company had been working according to those values.

HBOC's values, like those of many other organizations, were what Erin calls a set of 'anodyne norms, principles, or values'. The problem is that such descriptions don't help with everyday decision-making, especially when choosing between courses of action that might seem equally defensible.

Erin recommends a different approach to describe your culture so that it is applicable every day for everyone in the organization. She stipulates six rules based on dilemmas: 'The trick to making the desired culture come alive is to debate and articulate it using dilemmas. If you identify through dilemmas your employees routinely face and clearly state how they should be resolved.

Here is a summary of her six rules:

1. 'Build your culture based on real-world dilemmas.'

   A dilemma could be the fictional case of Tom, who leads a customer service team. Everything is going well, and his team is engaged and happy. The next quarter will be the busiest season for his team, so staying motivated and focused will be crucial. However, Tom knows that in four months, a planned organizational restructure will split up the team. His CEO, Julia, informed him of this at the last team manager meeting. What should Tom do? Option A is to favor stability for the next quarter and not tell the team. Option B is to favor transparency and tell them now. Option B will likely hurt short-term performance (and customer service satisfaction) but build long-term trust. Option A will deliver the opposite outcome: short-term customer service satisfaction during the peak season, yet long-term trust issues affecting the smoothness of the upcoming restructure. It is hard to say that Option A is better than Option B. To help Tom make a decision aligned with corporate culture, Julia must ensure it is communicated clearly how to respond to dilemmas like this. If the cultural DNA is to favor transparency over stability, Tom should know from Julia that "At this company, transparency is key. This means that you should always share information—even when it is bad news, we tell what we know."
   
   

2. 'Move your culture from abstraction to action.' 

   Erin Meyer argues that you should 'dilemma-test' your values. If a value can't be communicated through dilemmas, it might be overly broad. For instance, if you want your people to feel psychologically safe when sharing ideas, Pixar's value of 'regularly sharing unfinished work' provides a clear answer for a common situation in CX: having a great idea for improving customer satisfaction and deciding how to share it. Should you: Option A: Hold off on sharing until you have perfected your presentation on the idea? Option B: Share as soon as possible, even if the idea is unfinished so that feedback can help you improve it. Most of us can relate to this dilemma. For those at Pixar, the answer is clear: Option B—share now. This aligns with the company's values of transparency and iterative improvement.
   
   

3. 'Paint your culture in full color.' 

   I love this point in Erin Meyer's article. Make it easier to remember your values by choosing the right words. Erin cites research on the picture superiority effect (PSE), which shows that we remember images better than words. For example, Airbnb values transparency as a cultural principle. But as Erin points out, remembering "We practice transparency" can be challenging. It’s much easier to recall Airbnb's vivid imagery of "Elephants, dead fish, and vomit," which visually represents the idea of addressing even the most uncomfortable truths. This stark imagery helps employees and managers confront and discuss difficult issues they might otherwise avoid.
   
   

4. 'Hire the right people, and they will build the right culture.' 

   This point in Erin's article aligns perfectly with what many CX experts have been emphasizing recently: involve HR in your CX efforts and hire the right people. I recall from Horst Schulze's memoirs of his time as co-founder of Ritz-Carlton that they faced numerous hiring challenges. However, over time, they defined specific traits for particular roles. For instance, they discovered that a doorman needed to have a genuine interest in outdoor activities, regardless of the weather. This insight helped them hire individuals who were not only skilled and aligned with the hotel's values - but they would also be able to stay motivated in the long run. Even after a long winter of rain and snow outside the hotel.
   
   

5. 'Make sure that culture drives strategy.' 

   Here Erin takes on an interesting historical perspective. 200 years of - more or less - being in an industrial age has emphasized the need to focus on values of repeatability and eliminating error. And if you build engines or transmissions that is still relevant. But for many companies today the ability to adapt and innovate is more important for long-term survival than repeatability. They should probably formulate values along the lines of "We would rather fail twice and get it right the third time than do nothing".
   
   

6. 'Don't be a purist.' 

   Of course, there will be situations (dilemmas) where your bold value statement might not be effective. Transparency could be a key value, and you've found a striking way to communicate it (like Airbnb does). However, there are times when this approach might not be suitable. One of Erin's examples is Netflix's CEO wanting complete salary transparency for all employees. While this level of transparency is implemented for directors and above, lower-level employees pushed back, finding it too intrusive. This situation illustrates that even well-intentioned values can have limitations and may need to be adapted based on the context and the needs of different employee groups.
   
   
   

The Path of Dilemmas

Reading Erin Meyer's article in the latest HBR Magazine a few days ago inspired me to write this piece. To me, it stands out as something you can start implementing right away—even on a small scale, like within your team. It will be a long journey on that Routemaster bus through every alley and mews of London towards the Customer-Obsession Club, but if you stay on the bus, it will eventually arrive. I believe this approach is one of the most promising I’ve encountered.

London is full of exclusive clubs. Let's make sure the Customer-Obsession Club isn’t one of them. Let’s expand the club’s membership to 4% or even 5%.

Thank you for reading this far.

And thank you, Erin.