Forrester believes that the only source of competitive advantage in the next decade will be customer obsession.
A customer-obsessed company focuses its strategy, energy, and budget on processes that enhance knowledge of and engagement with customers and prioritizes these over maintaining traditional competitive barriers.
It's no longer sufficient to be simply customer-centric or customer-focused.
To succeed, companies must become customer-obsessed and that is not just a matter of dealing with the tactical touch points of the web, contact center, or salesperson, but an integrated approach, which crosses all of the relevant stakeholders.
IT doesn't own customer satisfaction but must support it
According to a recent survey of Forrester’s global CIO panel, few CIOs owned primary responsibility for customer satisfaction policies, strategies, delivery, or metrics.
High-level planning and most of the accountability for the delivery and metrics remain within marketing, sales, and dedicated customer service departments, whilst IT remains disconnected from customer satisfaction (see figure 1 below).
In order to become more customer-obsessed, IT must contribute to investments in all customer-facing technology, not just internal tools.
Budget authority for technology-based customer-centric systems, such as the customer-facing website, digital marketing, and the call center, remain with marketing or other departments.
IT has budget authority for enabling tools such as business intelligence and business process management (BPM) in half or more of the organizations.
Budget authority for other tools that can be used to enhance customer understanding and to manage the business processes at the point of customer interaction remains outside of IT.
Not surprisingly, IT's largest area of influence is in the operations of technology platforms.
When we drop down to the operational level, IT's responsibility for customer experience platforms and processes ticks up to a significant level across the different areas.
However, operational responsibility without clear ties to the desired outcome — or the business cases to justify spending — can and will lead to suboptimal spending and performance.
Use capability maps to move from an inward focus to an outward view
An important approach to integrated planning involves creating a business capability map for the organization.
Business capabilities define what an organization does to execute its mission or support its position in the marketplace and they are the key building blocks of the organization.
The capability map provides the overarching framework the CIO can use to align IT with the business, rationalize the application portfolio, and communicate IT's value to the users and consumers of IT's services.
CIOs can use the capability map to shift from an inward-looking perspective, where the technology infrastructure is a collection of platforms, to an outward-looking one, where the business and its structure frame all discussion and decisions — and thus elevate the CIO role from technologist to business partner.
CIOs in customer-obsessed companies must map their customer-oriented capabilities to their execution and delivery plans and prioritize their strategies to support these capabilities.
Capability maps will serve as a linchpin for communicating IT capabilities and jointly defining business priorities.
Implement the four attributes of customer obsession
In the new era of customer obsession, organizations with intimate knowledge about their customers will succeed, while the organization that keeps focusing on the competition will be left behind.
Forrester has defined four key attributes for customer-obsessed companies that every CIO must strive to support:
- Nimble: emphasizing speed over strength. Customer-obsessed companies embrace rapid pursuit of customers in new markets and new channels.
Continually seek ways to pivot the business to gain new opportunities. Build organizational structures and processes to react quickly to market opportunities and customer needs.
Prototyping solutions, operating with a Lean mindset, and using reusable components allow you to focus on delivering value to customers with speed and agility.
- Flexible: valuing versatility over lock-in. Lock-in mechanisms. Mobile phone contracts, proprietary technology, and frequent-flier programs, for example don't create loyalty; they just create barriers to leaving.
Help your organization move away from relying on proprietary vendor technologies and multiyear contractual commitments.
- Global: embracing worldwide supplies, demands, and markets. Your current and emerging competitors are finding new markets and more-efficient sourcing models.
Sourcing and selling from a single country perspective is a losing proposition. Look for opportunities to leverage the global talent pool and build competency and efficiency across your services.
- Smart: providing information-rich services over dumb products or transactions. The new consumer uses channels, especially mobile channels, to seek information everywhere instantly.
Your customers can scan bar codes in your store and know your competitors' prices.
If you're customer-obsessed, your products and services need technology at the back end to quickly update information in the cloud as well as apps and pages to deliver it in a customized way to your customers wherever they may be and however they may be connecting.
Chip Gliedman is VP and Principal Analyst at Forrester Research