Customer centricity is good for business
Customer Centricity is a business strategy and culture that puts the customer first, with decisions made based on the impact they will have on the customer. It’s pretty clear how this can lead to a better customer experience, and then to higher customer satisfaction, loyalty and retention. By adopting a customer-centric strategy, McKinsey & Company reported that companies can achieve a 20 to 30 percent uplift in customer satisfaction, and Forrester and Adobe reported an almost 2x higher YoY growth in customer retention. But customer centricity also impacts the bottom line. McKinsey & Company found that by improving customer experience from average to exceptional companies can increase measures such as likelihood to renew or buy other products by 30 to 50 percent, and Deloitte and Touche found that, overall, customer-centric companies are 60% more profitable.
But how do you know that you are customer-centric enough or how to become better at it? We believe in four key principles and have developed programs to enable us to translate them into action:
#1: You can’t improve what you can’t measure
This is an overarching principle. The only real way to know that you have improved in a certain area, is to measure your performance in it at two points in time and see if you were able to generate a better result from one to the other. In between, ideally, you would have taken corrective action to improve. Unless you take such a data-driven approach, all you have are words. This also applies to customer centricity.
#2: You know that you are customer-centric when your customer says so
Unless your customers perceive you to be customer-centric, you are not. Your first priority is therefore to seek customer feedback.
Here are a few recommendations how to go about it:
- Seek feedback on a recurring basis and from everyone at the customer whose work is impacted by your products and services, not just from the more senior executives.
- Obtain quantitative data using a standard set of questions. This is critical for measurement and so you can see change over time. But also seek qualitative data via open-ended questions – this type of feedback is always priceless and can offer you actionable insights.
- Always best if you can do this in person or via a phone or video interview, showing your customer you listen and care about what they have to say.
- Once customer feedback is obtained, it’s important to agree on an improvement plan together with the customer and monitor its progress.
The Amdocs Voice of the Customer program constantly measures and improves our customers’ experience. Customers are asked about every touchpoint and aspect of their engagement with us: people, products, processes, services, value, quality, ease of doing business, strategic alignment and more.
#3: To improve customer centricity you need the employee point of view
Customer feedback can be described as “the symptoms”. But to figure out the internal issues and behaviors that led to it, you need employee input. When seeking employee input, it’s important to include all customer-facing folks, from the senior executives in charge of the business relationship with the customer, to the last developer and tester. The people who work directly with customers are the company for their customer stakeholders. The relationships they build with them is what makes the difference and eventually impacts how you are perceived as a company.
#4: To know what to improve you need to break down customer centricity into tangible areas and measure them
With application across all aspects of work, customer centricity can have multiple manifestations. To be able to identify and prioritize areas for improvement, you need to break customer centricity into tangible pieces and find a way to measure how you perform in each of them. The more granular you get, the clearer it will become what you need to improve.
As part of the Amdocs Customer Centricity Framework for measuring and improving our customer centricity, customer-facing teams undergo a quantitative assessment targeted to measure their customer centricity across six domains:
- Customer Relationship – looking at how well they connect with their customers, including trust and intimacy levels
- Research – looking at how well they know their customers
- Prioritization – looking at whether they are defining the right strategic directions when engaging with their customers
- Creating value – which is about ensuring that the customers’ desired business outcomes are met each step of the way, as well as about providing innovative ideas that exceed customer expectations
- Measurement – looking at how well teams are measuring and communicating the value they deliver
- Culture – which is about assessing internal team behaviors and attitudes, covering topics like empowerment and social responsibility
The assessment includes 4-6 questions per domain which help to spotlight specific weaknesses. Teams are then given an overall score, as well as a score in each domain. An improvement plan is put in place, prioritizing domains with lower scoring. Following execution of the improvement plan, a second assessment is conducted to show if the team scores improved.
Are you measuring how customer-centric you are?
The Amdocs Voice of the Customer and the Amdocs Customer Centricity Framework are additional programs developed by the Customer Centricity team at Amdocs in support of our customer journeys, not just during the sales process, but throughout their engagements with us.