Knowledge Center: Article
Putting the customer first—for real5/6/2020 Karen Rosa West, PhD and Megan Herbst
Companies know that customers are important and that creating customer-centric organizations starts with customer-centric leaders. But that’s far easier said than done. Executives may think they’re highly customer focused, when really they’re not. They may not even realize how little time they spend with customers. And even when they’re aware of the gap and eager to fix it, other priorities seem to get in the way.
Before actions can change, mindsets need to change. Drawing on our assessments of more than 3,000 leaders at all organizational levels, by the leaders themselves and their colleagues, we looked at attributes associated with “put customers first.”
We found a divide between lower-level leaders and executives, leading us to conclude that senior teams have much to learn from their more junior counterparts—and an important role to play in integrating a customer focus into leaders’ mindsets and into the overall tone and priorities of their organizations.
“Put customers first” is part of our META framework, which identifies the leadership behaviors that differentiate high-performing organizations, teams, and leaders as they seek to mobilize, execute, and transform with agility. At the individual level, putting the customer first means understanding and shaping customer needs, creating distinctive value for customers, and building deep customer relationships.
Getting out of the ivory tower
Our analysis shows that entry-level leaders are more likely to believe in having an absolute focus on attaining the highest levels of customer service, as opposed to attaining the level of service that the market demands.
We also found that, at lower levels of an organization, a leader’s ability to understand customer needs, create distinctive value, and build meaningful customer relationships has a greater impact on how colleagues rate leadership impact and potential than it does at higher levels.
This may well relate to the fact that lower-level leaders often interact regularly with frontline staff. If those who are closer to customers believe more in the value of customer service, it follows that bringing more senior executives closer to customers can nurture the same beliefs.
Of course, there’s only so much time senior leaders can spend in the field, but well-chosen touchpoints can offer meaningful ways to engage and collaborate with customers in areas that add value. For instance, an executive vice president of a financial solutions division recently visited his company’s website and found there was no easy way for customers to add to their own accounts, even though helping customers build savings was a corporate goal. Paperwork and signatures were required, which certainly didn’t match the experience offered by competitors. With this knowledge, as well as data pointing to other barriers to doing business with the company, this leader is now embarking on a multiyear digital transformation journey with a customer-centric mandate.
Executives can also make good use of social media to connect with customers, increase interactions with frontline staff using internal communication tools or town hall meetings, and become directly involved in customer experience initiatives.
Putting customers into core values
We also found that lower-level leaders believe that strong customer relations are determined more by who you are and why you do what you do, while those at higher levels cite the quality of products and services. Those who are less senior, in other words, hold beliefs and values about customer relations that are more aligned with organizational purpose and vision, while top executives are focused more on how the work is carried out.
It makes sense that people who are close to the customer need to believe in the organization and the work they do, because when they’re engaged, the customer is engaged. But these attitudes also need to come from the top; otherwise, behaviors and culture won’t change consistently throughout the organization, no matter how compelling the purpose or vision may be. And real change will happen only if a customer focus is integrated into every part of the organization and reinforced at all levels—for example, involving customers in product and service design, creating customer-centric marketing and sales messaging, or changing structures and processes to remove barriers to putting the customer first. It also means including customer-related competencies in leadership roles and responsibilities, assessments, and reward strategies.
Innovating and disrupting
Finally, our research shows a correlation between those who score highly on “put customers first” and those who are more likely to lead innovation or to disrupt and challenge the organization—attributes relating to the “transform” element of the META framework and characteristics that many organizations will find particularly valuable as they seek to build resilience in response to the COVID-19 pandemic. (For more on the value of disruptive leaders, see “Disruptive leaders: An overlooked source of organizational resilience.”)
In this context, it’s likely that innovators and disruptors are more willing to seek inspiration from customers and find solutions that create customer value. So enabling and encouraging transformative behaviors could also help to nurture a stronger customer focus in leaders.
On the flip side, being closer to customers could make leaders more willing to disrupt and innovate in order to make a difference for those customers, or could encourage more creative ways to lead change beyond product innovation, such as changing customer behavior. Thus, encouraging executives to have a greater customer focus could help create new growth opportunities.
A case in point involves an insurance CEO who listened anonymously to customer service calls and discovered that the way his call center employees handled routine transactions, and the tone they used, did not befit the brand the CEO was trying to create. Indeed, the approach discouraged cross-selling of other products and services. These insights precipitated a shift in leaders’ thinking and a change in culture that resulted in the company climbing from 20th in the market to 4th in three years.
It might seem surprising to state that senior leaders should look more like junior ones. But with growing calls to turn the organizational pyramid upside down or, at the very least, close the gap between the corner office and the shop floor, perhaps it’s really not so surprising. Customers and people are, after all, an organization’s most valuable assets.
Karen Rosa West (email@example.com) is a partner in Heidrick & Struggles’ Chicago office and head of psychology, product design, and research for HLabs, the research arm of Heidrick & Struggles.
Megan Herbst (firstname.lastname@example.org) is a psychological analytics coordinator for HLabs; she is based in the Chicago office.
You can reach them at HLabs@heidrick.com.