Term Paper on "Customer Centric Culture"

Term Paper 10 pages (3643 words) Sources: 20 Style: APA

[EXCERPT] . . . .

Customer Centric Culture - Organizing Strategies That Succeed

The wave of change in business strategies - from product centric to customer centric - over the past two decades has been dramatic and yet challenging as well. For those businesses that "get it" when relating to a customer-as-king philosophy - albeit a 100% change in company culture is a substantial risk - in many documented cases their growth and prestige has been nothing short of remarkable. For other firms, that bring up the rear in the marketplace by insisting they know the customer but still focus on product-centric approaches, the light at the end of the tunnel is just a mirage. This paper reviews and reports on both of these dynamics.

An article in the Harvard Business Review by Mohanbir Sawhney ("Don't Homogenize, Synchronize") uses the metaphor of the Palm device (and how it synchronizes seamlessly with one's personal computer when placed into its docking cradle) to advocate for companies to get all their systems in sync. And the article uses the example of 3M as a company with multiple brands and 50,000 different products as an example that once was totally out of sync in terms of its terrible fragmentation. Indeed, 3M was an innovator, but the company's customers were left in the lurch, having to wade through 3M's Web sites and visit "several different sites to get information on related products."

Beyond that problem, the basic problem with 3M's Web site was that it was concentrating all its "internal silos" rather than on "its customer's needs." So, 3M got synchronized, and now presents a more "unified fact to its customers" by storing all "customer relationships and product configurations" in a single database. This transformation from the awkward presentation of products and slipshod system of customer record keeping - similar to what Thompson Financial did - is called moving from a product-centric company to a customer-centric company. Instead of finding "customers for its products," both these firms (and untold hundreds of other companies) now concentrate on finding "products for its customers," Sawhney writes.

For companies, the focus is often on "creating great products," Sawhney continues; but for customers, they're thinking about "the activities they perform and the benefits they seek." Products are "ends" for companies, but for customers, "products are means," Sawhney explains. And if there is a disconnect between how customers think and how companies organize themselves, there will inevitably be "inefficiencies and misses opportunities," and that brings into focus the need for a customer-centric culture within companies that truly understand the need to build their marketing and production specifically and around the needs and habits of customers.

Another article in the Harvard Business Review relates to the new dynamics of businesses on the global stage; in the past, corporations were in control of determining what the consumer should want and buy, clung to their own defined roles - and their customers and suppliers stayed within their well-defined roles. However, the article ("Co-opting Customer Competence") points out that in the new marketplace it is more like a cooperative family with suppliers, vendors, corporate participants and consumers all interacting on the same stage. Indeed, the customer today brings competence and dialogue to the corporate table as part of the "collective knowledge available to the whole system" (Prahalad, et al., 2001).

In this new marketplace, which clearly is more customer centric than merely "customer friendly," corporations either see their customer interaction as "...a dialogue of equals" or they will fall victim to outdated thinking and fail. What's more, the dialogue must "evolve" or it will shrivel up and die, Prahalad asserts. In addition, a customer-centric company must learn how to a) mobilize customer communities (which is possible due to the Internet); b) manage "customer diversity" (in the technology field, for example, there is a "sophistication gap" between consumers who readily learn new software and those who struggle, albeit they are all valued customers); c) co-create and manage personalized customer experiences (by "harnessing" their competencies); d) manage the evolution of customers (by realizing that customers judge products by the "degree to which a product or a service gives them the experiences they want."

Another key point made by Prahalad is that a company must be intelligently "shaping customers' expectations" as well as seeing the "customer as an asset" to be able to create and sustain a customer-centric culture.

Still on the subject of customer expectations, a recent article in IBM Systems Journal (Hirschheim, et al., 2006) analyzes the dynamics at work when approaching strategies for successfully marketing IT services to businesses. Marketing IT services is a complex and difficult task, since, as the article ("A marketing maturity model for IT: building a customer-centric IT organization") points out, there are really three separate customer models to deal with. There are the "transactional customers" (typically the desktop user); and there are "relationship customers" (usually companies which use and pay for multiple services and for whom ongoing operational support is vital); and third, the "IT influencer" (typically a "business-side senior executive, external to the IT organization," who assists in creating visions and marshalling resources).

The bottom line in this rather lengthy and tech-heavy article is that within the activities of "restructuring, reengineering, downsizing, out-sourcing, back-sourcing..." And offshoring, companies have too often concentrated on "process and structure" and hence there has been a "failure to build an effective relationship between IT and the business." But to create a truly customer-centric culture within one's IT company, there needs to be, Hirschheim writes, "strategic alignment" between IT and the business customer the IT firm must somehow see the process from the perspective of the customer and that entails "measuring user satisfaction." Indeed, the author concludes, IT today "operates in an environment in which every perturbation in service becomes the subject of 'water-cooler gossip'." Slip-ups in understanding the three levels of IT customers are out in the open in a hurry, and word travels fast when IT can either be a seamless assistant or a frustrating speed bump.

Meanwhile, in the Journal of Personal Selling & Sales Management (Leigh, et al., 2001) the authors indicated that strategies designed to increase sales within a corporate setting had been (up to that time) "very limited." But based on research work by The Chally Group, the list of "best practices" that the writers created for sales groups began with "...establishing a customer-centric culture." The other strategies (seven in all) focused on markets, technology, and sales personnel. But why did the Chally Group's well-known 1998 study ("Customer-Selected World Class Sales Excellence") hit the nail on the head for Leigh, et al.

For one reason, the need to "continuously upgrade the competency and commitment" of the sales component of any company should be linked to the strategy of creating a customer-centric culture; i.e., those candidates who show the strongest capacity for embracing and celebrating the customer centric philosophy should have priority when it comes to hiring. Leigh reports that the Chally Group's study emphasizes hiring those who: 1) wish to learn about customers and initiate a dialogue with customers; 2) can embrace all selling roles that fit customer requirements; and 3) are self-motivated and show cognitive and procedural knowledge.

Writer Leonard L. Berry ("The Old Pillars of New Retailing") explains that customer-centric cultures try hard to understand the need to create a "total customer experience" (Berry 2001). While his "Pillars" may seem obvious, they resonate with common sense. Published in the Harvard Business Review, Berry offers five "Pillars" in which to build customer-centric cultures within an organization. Those include solutions, respect, emotions, pricing and convenience. While they are apply to just about any business climate, most interesting to this writer is "emotions" ("Pillar 3: Connect with Your Customers' Emotions"). An example of reaching out to the emotional side of a company's customers is Journeys, a shoe store, which targets young men and women. A Journeys' store "pulsates with music, videos, color and brand merchandize," Berry writes; and while being "both welcoming and authentic to young people," Journeys' sales staff is young, dresses casually, and exerts "no pressure to buy." That is certainly a classic example of a customer-centric culture - which reaches out to the emotions of its shoppers.

There are a never-ending variety of ways in which companies can implement customer-centric cultures. The journal Intelligent Enterprise offers "customer-centric personalization" examples and ideas drawn from e-business relationships. The company Lands' End, for example, goes after repeat customers by offering "My Virtual Model," a service that invites customers to enter their measurements and try clothes on a 3D model. As of the time the article was written (White, 2001), over a million and a half customers had used the 3D model to "try on" clothes. Basically, these Web site merchants are learning to be "customer-centric" rather than "produce-centric" - and a perfect example is amazon.com. After purchasing a book at Amazon, the Web user is shown "...a list of other products that were bought by people who purchased the same product," White explains. Also, the… READ MORE

How to Reference "Customer Centric Culture" Term Paper in a Bibliography

Related Term Papers:

Customer Experience and Employee Satisfaction and Its Relation to Customer Centricity Approach at the Organizations Term Paper

Customer Experience and Employee Satisfaction and Its Relation to Customer Centricity Approach at the Organizations

In the last decade the world has experienced dramatic shift in the business culture and… read more

Term Paper 15 pages (4822 words) Sources: 15 Style: Harvard Topic: Business / Corporations / E-commerce

---

Customer Centric Business Design Term Paper

Customer Centric Business Design

The Coca Cola Company

The purpose of this work is to describe how an organization can attempt to provide and control customer value through its value… read more

Term Paper 4 pages (1244 words) Sources: 1+ Topic: Business / Corporations / E-commerce

---

Customer Centric Call Center Term Paper

ability of an organization to deliver exceptional customer experiences the greater their ability to survive in a turbulent global economy. The managing of customer experiences and the quantification of those… read more

Term Paper 40 pages (10330 words) Sources: 1+ Topic: Business / Corporations / E-commerce

---

Customer Centricity Thesis

Customer Centricity - Literature Review

Literature on this kind of topic is significant, for reviewing it can give a good idea of everything that has taken place. It becomes necessary… read more

Thesis 20 pages (6336 words) Sources: 10 Style: Harvard Topic: Business / Corporations / E-commerce

---

Customer Expectations in the Hospitality Industry Thesis

Customer Expectations in the Hospitality Industry

Customers' expectations are the future of any organization, and this is particularly relevant to the hospitality industry. To the extent an organization creates expectations… read more

Thesis 30 pages (8123 words) Sources: 20 Style: APA Topic: Business / Corporations / E-commerce

---

View 100+ more related papers  >>