Beyond Customer Friendly: Becoming a Customer-Centric Organization
Jay Dhar 120000G908 email@example.com | | Tags:  mobile bpm customer_success business management process odm
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Have you ever thought about how the “baby boomers” are different than Gen X or Gen Y (a.k.a millennials)? The millennial is the largest generation in history, in the U.S. and worldwide. Within just a few years, millennials will have the most dominant share of wallet power of any generation. I am a Gen Xer, and it's my opinion that if there is one thing that differs in my generation from the previous, it is a lack of patience. I directly equate this lack of patience to differences in expectation and loyalty in the business world. Research shows that when it comes to customer loyalty, age really does matter. Baby Boomers are almost twice as likely to be loyal to their service providers as their younger counterparts, according to a report by Optus.
During the 80s or even the 90s, did my parents ever think about switching from one bank or insurance company to another for better customer service? Probably not. Their expectations were not the same as they are today, and they had strong loyalty to their providers. By the same token, enterprises were “product centric”, and their focus was to produce products at lower cost in order to increase profitability. A Global Consumer Banking Survey 2012 by Ernst & Young shows that the proportion of customers planning to change banks has grown by 70% since 2011. In another piece of research by Deloitte, it was found that homeowners in the 18-34 range changed insurance carriers 2.5x more often than those 51 and older. For millenials, product features and customer friendliness are basic expectations, and not key differentiators.
Peter Fader, Wharton marketing professor and co-director of The Wharton Customer Analytics Initiative, argues that too many companies are customer friendly, but not customer centric. In other words, they treat each customer the same, missing an opportunity to discover who their best customers are. I couldn’t agree more. For millennials, customer experience and customer engagement are what differentiates one company from another. They demand a customer-centric experience—one tailored to their wants and needs.
In particular, there are 3 trends that I'd like to highlight:
These trends have emerged new business models in the industry. Companies like Netflix, Amazon, and Uber have built their business with customers at the center. As a result, customers that use these services now expect to have the same experience while doing business with banks, insurance companies or healthcare providers.
For some examples of how companies are successfully implementing customer-centric models in various industries, take a look at these case studies: The Ottawa Hospital, which implemented a more patient-centric care process, and Banco Espirito Santo, a bank in Puerto Rico transformed into a more customer centric organization.
Feel free to leave your comments on some of the business challenges in your industry around change in customer expectations. I will discuss in my next blog how you can take advantage of IBM Smarter Process to become more customer centric as well as to achieve operational improvement and top line growth.