Customer centricity is a popular buzzword that we come across time and again in everyday life. But what do we mean by this and how does it work in our day-to-day business?
Customer Centricity describes the approach that the customer, not the product, is the main focus of the business. It is the conviction that value creation in the company starts with the customer. This approach is used in product and service development in particular, but can also be applied to other areas.
Customer orientation and customer focus
In German, the term "Kundenorientierung" is more widely used than the German word "customer centricity". It is certainly worth discussing whether they are one and the same. However, as the terms are not very clearly defined, we only want to enter into the discussion briefly, as this will only end up in a muddle of words and we will end up going round in circles.
However, there are experts who see customer centricity as a further development of the concept of customer orientation. Customer centricity is therefore understood as a guiding principle that is applied separately, particularly in marketing and other customer-related areas. Customer centricity should therefore be understood as a strategic and operational approach to customer orientation that takes place in all areas of the company, ensuring that thinking and acting is holistically focused on the customer. Something that we in service management also refer to as Service Excellence know. However, both terms are usually used interchangeably.
Regardless of whether you want to understand the terms separately or synonymously, you can definitely say that the idea of how companies can focus on the customer has changed. Awareness has increased to the effect that the principle of "the customer is king" should not just be understood as vague lip service, but must also become the focus of corporate divisions that are otherwise usually preoccupied with their own problems and interests. Ultimately, this also requires a more strategic approach. But how can we achieve this?
First create a common understanding of customer centricity
As I said, the terms are often somewhat blurred and you should start by creating a common understanding of what you mean by customer centricity. You could initially divide the topic into three areas:
The Customer success refers to the customer's ability to use your products and services in the intended manner.
The Customer experience describes a hopefully positive experience that the customer had with your company and your employees during the entire customer journey.
Under the Customer Satisfaction on the other hand, we understand the customer's overriding perception of your company's performance and offering.
You should keep these three areas in mind when thinking about which levers you need to change in your company. Keep in mind, however, that customer centricity should not be implemented in a silo structure, but requires an action plan for the entire organization in which the efforts of individual departments flow into one another.
What points do I need to address in order to think and act in a more customer-centric way?
To ensure that customer centricity is not just a buzzword in your company, but can actually be developed and put into practice, you should plan your approach in a sensible way. Here you can follow 5 different starting points:
1. define customer-oriented corporate goals!
Your company may have already set itself bottom-up corporate goals that should correspond to customer centricity. At the end of the day, however, middle management is still exclusively chasing the next classic sales targets. As a result, your strategy naturally loses its impact. To avoid this, success should not only be evaluated on the basis of monetary key figures, but customer-oriented key figures must also be used to a greater extent. Examples of this are customer satisfaction score, churn rate, customer-effort score and recommendation rate. These should also be anchored in middle management as orientation.
2. develop a suitable corporate culture
You may need to change your entire corporate culture. Focus on trust and respect towards the customer. And don't forget the personal touch! It is important to pay attention to a personal environment in all key figures and statistics. Standardized surveys and the collection of key data are one thing. In practice, however, personal and informal discussions with customers are always very important. This is essential in order to gain sufficient knowledge about the problems and the business on the customer side. This should therefore also be taken into account as far as possible in a corporate culture that is open to the customer.
3. acquire knowledge of customer needs and expectations
Feedback from customers must be continuously collected, evaluated and used. In practice, many companies sometimes have problems Using feedback correctly. To do this, you need to rely on standardized procedures that are integrated into the normal day-to-day work processes. The customer's perception of your company's performance is crucial and must be made visible and understandable throughout management. Take appropriate measures to achieve this!
4. the holistic approach
We want to avoid a silo structure in which each part of the company muddles along in the direction of customer centricity. That's why it's important to get all your employees on board and get them to act in a customer-centric way. However, especially in business areas without customer contact, you will encounter employees who are not particularly comfortable with this strong focus. The task here is to gear internal communication towards providing every employee with examples and basic instructions on how to implement customer focus in everyday life.
5. ensure the measurability of customer centricity
Many key figures for measuring service success are also important for the customer. For example, the speed with which faults are rectified is important for you in order to reduce the costs of service provision on your side, but it also has a major impact on customer satisfaction. Find out which metrics and key figures you already collect are most important for customer satisfaction. Then use the insights gained to prioritize and optimize them.
In addition, you can of course also collect new key figures that are important for customer satisfaction and also focus on these. Surveys among your own employees can also provide information on how well your concept has been understood. This ultimately makes your customer centricity measurable.
