Michael Shrage’s recent Harvard Business Review post, Great Customers Inspire Great Innovations, got me thinking:
Why, amid so much evidence of the power of customer-centric business, are so many companies still mired in inside-out operations? Why do we hear so much talk but see so little action?
Shrage’s post reminds us that behind most great innovations lie customers and clients that made those innovations possible. "Busicom, a scientific calculator company, for example, commissioned Intel [in 1969] to design a chipset for its new programmable calculators. That led directly to Intel’s breakthrough creation of the microprocessor." On a much broader scale, "Wal-Mart’s incessant and relentless demands for ‘everyday low prices’ transformed every supplier it touched."
Shrage’s post also reminded me of an essential book from way back in 2003 by IT industry analyst David Moschella, Customer-Driven IT. Taking off from the familiar point that the tech industry was always led by vendor-based innovation, Moschella outlined the fundamental shift underway in the early 2000s toward customer-driven innovation in industries ranging from media and financial services to health care and education.
Ranjay Gulati’s more recent Reorganize for Resilence provides similar testimony, evidence, and examples of the power of customer centricity for solutions development, marketing, and sales (you can watch my partner Steve Hurley’s interview with Ranjay on our new YouTube channel).
Shrage, Moschelle, and Gulati are actually making a critical point beyond the normal blah-blah about listening to customers and strengthening relationships. As Shrage notes, even this approach (which is typically more talk than action) is not enough. Rather:
"The essential question is who are the customers that come with the problem sets and parameters that push you to rethink, or redefine, your business? Which customers and clients does your firm celebrate as innovation partners -- and why?"
What amazes me, though, is why B2B marketers aren’t investing more in serious programs to build key customer relationships, generate deeper customer insight, and build stronger customer collaboration at least as a foundation to help drive that necessary innovation.
After all, it’s not just academics and pundits like Shrage, Moschella, and Gulati pounding their fists. IBM’s latest survey of more than 1,500 large enterprise CEOs around the world showed that 95% of top performing organizations identified getting closer to customers as their most important strategic initiative over the next five years.
It is happening to some extent, of course. In B2B technology, where I spend most of my time, a number of companies are putting some real money where their mouths are. For example:
- IBM's three-tiered program to engage top CIOs reflects a substantial investment in a sophisticated approach to help drive innovation as well as loyalty and advocacy
- CSC's WikonnecT community for the insurance industry represents a sizable commitment to customer collaboration that similarly helps generate innovative offers
- The EMC Community Network, bringing together thousands of customers, partners, and employees for ongoing conversation, support, and solutions development, is built around the efforts of a dozen-member corporate team with dozens of other community managers across the company
More often, however, I see situations where the rhetoric far outpaces the reality:
- A large IT services firm aggressively (and expensively) using Twitter and other social media primarily as just another channel to pump out corporate-designed messages and content
- A large enterprise software firm touting its launch of a new "community" but doing none of the spade work to make sure any customers actually care
- A large technology equipment provider with nary an executive relationship program in sight
Needless to say, all three of these companies, like most of their peers, prattle on endlessly that "we're all about the customer."
For B2B marketers interested in moving beyond the rhetoric, there are some obvious next steps:
- Invest in social media, but make sure there's a heavy focus on listening and engaging; social media is first and foremost a tremendous vehicle for customer insight
- Invest in executive relationship programs, such as customer councils and peer networking events, but make sure there's no selling
- Invest in key account programs, but as much for the insight and collaborative innovation as for hitting near-term numbers
- Invest in program integration and information sharing; customer insight is of little value if locked in separate silos
If all this investment means cutting back in other areas, well, that's the price of truly changing strategy and priorities.
As always, though, it's the mindset that matters most.
I was reminded of this for the umpteenth time last week while pulling together some research around customer reference programs for a client. Most tech companies have a reference program, but far too many are focused transactionally on getting customer testimonials and promoting success stories. There's relatively little attention to actually learning more about customer needs, strengthening relationships, and building collaborative innovation (with some notable exceptions, of course).
These are your best customers, folks! If you're stuck in selfish transaction mode with them, there's a long way go to in getting to customer centricity.
Am I right to be so critical? What's working for customer-centricity on your end?
Photo credit: everywhereisimagined