The CX Hoax

By: Alaa Elhawwari

“We put the customer in the center of everything we do”

“Our customers are always in the heart of our operation”

“We always put customers first”

“We are driven by a customer-centric process and mentality”

“Customer satisfaction is our only KPI”

We always hear or read these sentences in the Vision or Mission statements of many companies whether they are a multinational global corporation or a new Start-Up that has just hit the market and all that is in between. CEO’s and MD’s are always starting their internal or press speeches using the same sentences.

Moreover, you can hear these sentences being used in most of the daily operational meetings between Employees, Managers and Directors. Even during the orientation day for new Employees in any company, the day usually starts with the “company’s culture” which indicates that we are a “customer-oriented organization”.

Have we ever asked ourselves about whether we really believe in these words and do we really think about customers in everything we do on a daily basis? How many times in your day have you wanted to make a decision related to the business, but you stopped and thought, “how will this benefit our customers?”. I don’t mean your internal customer which might be the department next to yours, I mean your external customers, the ones who receive your products.

One of the greatest examples of all times (I can say it is my favourite) is “Amazon”. Jeff Bezos, the CEO of Amazon, spread the culture of “focus on what customers want” within the company, to the extent that in every meeting whether the meeting is departmental or divisional, Amazon’s employees are required to have an empty chair in the meeting room for the “CUSTOMER” 1. Of course, there will be no customer sitting in the meeting, but the empty chair represents the customer and will make everyone in the meeting think “how will we benefit the customer with whatever decision we are about to make in this specific meeting?”. What really fascinates me is that Jeff Bezos always sticks to this rule even in the annual budgeting and strategic meetings. Any decisions taken inside Amazon from strategic decisions to a fulfillment center’s daily schedule is being taken based on how it will benefit the customers.

There is a very simple way to ascertain whether your company or organization really thinks about its customers and how it will benefit them. Is the organization just using these words as marketing slogan? We just need to ask ourselves whether decisions in the company are being made based on KPIs & budget or based on what will benefit the customers. Just ask yourself this question and keep the answer to yourself.

When there is a decision to be made and the only solution is to either save the balance sheet or do what the customer really needs, which one will your organization choose?

The aim of this article is not to discuss the importance of customer centric culture and processes, nor to show some statistics on how companies can create more revenue by focusing on customers’ needs. The aim of this article is to raise the following question: “are the customer focused strategies real, or just a hoax?”

What initiated this article was the shocking statistics I have read through the last year, that made me start to believe that Customer Centric (CX) is not as important to most organizations as they advertise all over the media, and I have intentionally used the word “advertise” as the CX mind set has been used as advertising material to cope with the market flow or to entertain investors. In the next few lines, I will share with you some statistics to show that CX is not as real as you might think and most of the organizations are still putting “revenues first”.

Two-thirds of Employees have direct customer contact at work, but they still don't seem to know what their customers care about.

In February 2020 “GALLUP Inc.” 2 conducted a study in Europe and the U.S. which shows that two-thirds of Employees have direct customer contact at work, but they still don't seem to know what their customers care about.3 In fact these numbers are scary as it shows that the customer facing Employees don’t actually know what the customers really want. The question that will immediately rise in your mind is: “if this is the situation with the customer facing Employees, what about the management?”

In November 2020, “SuperOffice”4 asked 1,920 business professionals to share their number one priority for the next 5 years, and the results were really shocking or I can say the results were devastating. 45.9% of the sample said the focus in the next 5 years will be on “customer experience”.5

The SuperOffice article (and you might agree) sees this number as very good as it beats those who think about product and pricing. But I see it the other way, 54.1% of the business professionals who might be leading big or mega corporations are not focusing on customers for the next 5 years (till 2025), and they would rather focus on product (33.6%) or pricing (20.5%). In the same article by SuperOffice, only 44% out of the sample will increase the investment in their CX initiatives, while 34% will not increase their CX budgeting at all and 22% will actually decrease their CX budget.

If we think that these numbers are good or promising, we are mistaken. We can see that more than half of the organizations in the market really don’t look after their customers and their needs but rather just focus on numbers and products, and almost a quarter of the organizations will decrease their investment for the Customer Centric (CX) initiatives and will redirect their investment towards product.

Individuals tend to overestimate their performance compared to others; this is known as “illusory superiority”. This behavior is also referred to in some references as the “Lake Wobegon effect”. Accordingly, while you are reading this article you might be thinking that most companies or organizations are ranking themselves higher than they really are, while your company is not one of them. Actually you might be now telling yourself your company is different, that you really care for customers and you put their needs and wants in the center of everything you do. Well, that might be true, but if your belief is only based on your feelings and your loyalty to the organization, this is a text book case for “illusory superiority” at work.

My advice is that you have to STOP IT right now. Some organizations intentionally do not want to face the reality about their customer experience and how it is not as good as they try to convince the investors, in some cases the customer experience is much worse than what they think. This will definitely lead to improper strategies around customer experience. The most important pillar here is how your customers think about your customer centric culture and action, which will lead us to the importance of customer feedback.

COVID-19 and Customer Centric Organizations

According to the Forrest’s 2020 CX Index report, Customer Centric scores have risen during and after COVID.6 The report is a result of surveying more than 97,000 U.S. customers across 250 brands and 14 industries from January to March. And the result shows an improvement in the CX scores during the COVID-19 peak in March and afterwards. Some organizations were truly focusing on customers and what they really wanted from their brands, and these organizations were able to create an exceptional experience for their customers by constantly exceeding their expectations. In addition, these organizations quickly adapted to the “new normal” which I personally consider the number one key factor for success during and after the COVID-19 peak in March 2020.

These organizations or brands created enough credit with their customers that granted them room for errors as they adapted themselves quickly to the new normal.

According to Forrest’s 2020 CX index report, the organizations that led their industries in 2020 were:

· Airlines: Southwest Airlines (73.5)

· Auto manufacturers (luxury): Lexus (78.6)

· Auto manufacturers (mass market): Subaru (76.6)

· Banks (direct): USAA (78.6)

· Banks (multichannel): Navy Federal Credit Union (82.4)

· Credit card issuers: USAA (83.9)

· Federal government: National Park Service (77.2)

· Health Insurers: Florida Blue (72.1)

· Hotels: Hampton by Hilton (77.5)

· Investment firms: Edward Jones (77.6)

· Retailers (digital): Zappos.com (79.3)

· Retailers (multichannel): Trader Joe’s (80.7)

· Utilities: SRP (70.6)

Finally, we all need to ask ourselves “are we really considering our customers’ needs in every single decision we make on a daily basis or do we just put the customer first slogan as a nice decoration on our desks?”.

It is not wrong to focus on your product, pricing or your network, but we have to be open and confident about it rather than hiding behind a customer centric illusion.

References:

1. Article “Take a Tip from Bezos: Customers Always Need a Seat at the Table” by Bob Thompson. Entrepreneur Middle East, May 28, 2016.

2. GALLUP Inc. is an American analytics and advisory company based in Washington, D.C. Founded by George Gallup in 1935, the company became known for its public opinion polls conducted worldwide.

3. Article “Do Your Employees Know What Matters Most to Your Customers?” by Marko Nink. Gallup.com, February 26, 2020. 4. SuperOffice is a cloud CRM platform designed to help you build and strengthen relationships through every step of the customer journey.

5. Article “37 CUSTOMER EXPERIENCE STATISTICS YOU NEED TO KNOW FOR 2021” Posted by Toma Kulbytė. SupperOffice.com, November 27, 2020. 6. Article “Forrester’s 2020 CX Index Report: CX Scores Rise Even During COVID” by Dylan Haviland. NASDAQ ttec.com, July 16, 2020.