All Posts Tagged With: "customer requirements"
Does Your Company Create Real Value?
According to a recent survey of 50,000 consumers in 14 countries including the US, 70% of the brands we interact with could disappear entirely and we wouldn’t notice it.
The survey also found that 20% of the brands we interact with have a positive impact on our lives.
Which list would your company make? (You can see two Top 10 brand lists at the end of this article.)
Umair Haque, director of the Havas Media Labs, explains the difference: “Did this brand make you fitter, wiser, smarter, closer? Did it improve your personal outcomes? Did it improve your community outcomes? Did it pollute the environment? We’re trying to get beyond ‘did this company make a slightly better product’ to the more resonant, meaningful question: Did this brand actually impact your life in a tangible, lasting, and positive way?”
I’ve written before about corporate social responsibility and how companies are embracing it to gain a competitive advantage (here and here), which is one part of the conclusions drawn by the Meaningful Brands survey and Haque. The other part is that companies are creating enduring brands by creating value for their customers, making them “fitter, wiser, smarter, closer,” to use Haque’s description.
This is where integrating the Baldrige model can help. The Baldrige Criteria ask key questions about understanding who your key customer groups and market segments are, what each requires, and how you meet and exceed those requirements. The Criteria ask how you build and manage relationships to acquire new customers, build market share, retain customers, and exceed…
10Nov2011 | Steve George | 0 comments | ContinuedBaldrige Model: How do you engage customers to serve their needs and build relationships?
Item 3.2 in the Baldrige Criteria asks key questions about how you support your customers and build relationships with them. The following processes, best practices, and problem areas look at critical issues in this part of the Baldrige model.
Your organization needs processes for:
- Identifying customer and market requirements
- Identifying and innovating products and services to enter new markets, attract new customers, and expand relationships with existing customers
- Enabling customers to seek information and customer support, conduct business with you, and provide feedback
- Determining and deploying the key support requirements for each customer group
- Determining which market customers and markets to pursue
- Using customer, market, and product/service information to improve marketing, build a more customer-focused culture, and innovate
- Build customer relationships and market share
- Manage customer complaints to resolve them promptly and address the causes of the complaints
Best practices to consider:
- Since people in the organization deal with customers daily, they assume that they know what customers require but have never validated their assumptions, which is a critical first step to improving customer satisfaction and loyalty.
- New product and service development processes involve customers in evaluating ideas and features.
- The organization also involves customers in identifying support requirements, which are then deployed to all employees who interact with customers, with measures of performance on those requirements in place and reviewed.
- Determining which customer groups and markets to pursue and which products and services to provide is an ongoing, strategic process that builds on core competencies and innovation.
- Understanding that very satisfied customers are much more loyal than satisfied customers, the organization identifies exactly how…
Baldrige Model: How do you obtain information from your customers?
The Baldrige Model: How do you obtain information from your customers?
Item 3.1 in the Baldrige Criteria asks key questions about how your organization listens to your customers. The following processes, best practices, and problem areas look at critical issues in this part of the Baldrige model.
Your organization needs processes for:
Listening to each key customer group and market segment across the entire customer life cycle, to former and potential customers, and to customers of competitors to obtain actionable information
Following up with customers on product/service quality, customer support, and transactions to acquire immediate and actionable feedback
Determining customer satisfaction, engagement, and dissatisfaction
Using data and information about customer satisfaction, engagement, and dissatisfaction to exceed their expectations and improve loyalty
Obtaining information about your customers’ satisfaction with your organization, products, services, and support relative to their satisfaction with your competitors and other organizations providing similar products and services
Best practices to consider:
Using established processes, the organization knows exactly what each of its customer groups and/or market segments requires and communicates that knowledge throughout the organization.
Listening posts are established for all customer groups and segments with processes for collecting, analyzing, and sharing the information from those posts.
Follow-up with customers typically includes relationship and transaction surveys and frequently involves focus groups, customer advisory panels, and involving customers in internal processes such as strategic planning, new product development, and process improvement.
Organizations go beyond the annual customer satisfaction survey by surveying customers more frequently, using tools like Net Promoter Score to determine engagement and loyalty, and validating survey results through focus…
16May2011 | Steve George | 0 comments | ContinuedWhat Do Your Customers Require?
It’s a fundamental question that demands a profound knowledge of who your customers are and what each individual customer is seeking. B. Joseph Pine II, one of the pioneers of the mass customization concept, recently wrote an insightful article for HBR that bashed the notion that most organizations are customer-focused. “They focus on markets rather than on any real, living, breathing individual customer,” he wrote here.
Pine offers a fresh perspective on what it means to be truly customer-focused with a list that could be a how-to for understanding what your customers require:
- Every customer is his own market. Every customer deserves to get exactly what he wants at a price he’s willing to pay, and companies must make that happen in a way that makes them money.
- Recognize that every customer is multiple markets. Customers want different offerings at different times under different circumstances.
- You must modularize your capabilities. Break your offerings apart into modular elements like LEGO building blocks, and then create a design experience that helps each customer figure out what he wants.
- Don’t overwhelm your customers with choice. “Fundamentally, customers don’t want choice,” says Pine. They just want exactly what they want.”
- Recognize that mass customization is not being everything to everybody; rather, it is doing only and exactly what each individual customer wants and needs.
- Remember your customers’ preferences. Create a database of customer profiles so that, with every interaction, you can lower our customers’ sacrifice—what they have to settle for or buy from you versus what they truly want and need.
To read more about…
4May2011 | Steve George | 0 comments | ContinuedCustomer Culture as Differentiator
Yesterday, I wrote about companies that have created the position of Chief Customer Officer to bring the Voice of the Customer to the senior leadership team. Today, I want to write about a company that probably doesn’t need a CCO because it differentiates itself through its customer-focused culture.
The Red Wing Shoe Company serves blue-collar trades such as construction workers, telephone lineman, and miners. Located in Red Wing, Minnesota, a city of 6,500 southeast of St. Paul, the company employs 2,200 people, half of them in Red Wing. Earnings for 2010 were $448 million, up 12% from 2009, which was a tough year for the economy and for the company. According to an article on Bloomberg (available here) Red Wing “went to a four-day work week, froze raises, scaled back its second shift, and offered voluntary retirement packages” to survive the recession, but hired more than 300 employees in 2010 as sales rebounded.
Red Wing carves a unique path through the shoe industry:
- It distributes its footwear through nearly 500 company-owned and independent dealerships, which are “old-fashioned shoe stores with sales people who sit with customers, measure their feet, and fit shoes one pair at a time.”
- The 285 independently-owned stores are dealerships from which Red Wing collects no franchise fees, marketing fund contributions, or royalties on sales. “Our goal is to provide great service through great dealers,” said Dave Murphy, president and chief operating officer. “We don’t want to saddle them with fees that make it harder to do their job.”
- Red Wing offers…
Dangerous Assumptions about Your Customers
One of the fundamental weaknesses I’ve seen in the dozens of organizations I’ve worked with is their assumption that they know what their customers require. I understand why they assume they know. They hear the compliments and complaints. Their customers buy what they are selling. Their patients receive services. Their students learn. Their constituents keep coming back. They interact with these customers, patients, students, or constituents daily. Of course they know what their customers require.
I remember helping a manufacturer early in its Baldrige application process. It was its industry’s worldwide leader and had been for several years. It worked closely with its distributors and had ongoing customer contact. It assumed it knew what each customer group required even though it had never formally determined those requirements or tested them with customers to make sure the lists were right.
When I presented my evaluation of its application to senior leadership, my first point was that it did not have a rock-solid understanding of customer requirements. I thought they were going to tear my throat out until the president interrupted and said he thought I had a point. As a result, the company hired a market research firm to close this gap. Two years later, it received the Baldrige Award.
The Baldrige model is a process model. The starting point for any effective process is knowing what the customers of that process require. That’s true at the macro level — profound knowledge of what your customers require of your organization — and at the…
1Mar2011 | Steve George | 0 comments | ContinuedSmart Question #3: Who Are Our Customers and What Do They Require?
(This excerpt is from The Baldrige Edge, an e-Guide from Baldrige.com. You can learn more about the guide by clicking on the black-and-red box on the right.)
Your organization exists to serve people, as does your department and your work group. Without customers, external and internal, you don’t have a job. Without satisfied, even delighted, customers, your job—and your organization—may be in danger.
In the course of a day’s work, it’s easy for the customer to disappear from the discussion, and that is an opportunity for you. We’ve already talked about process thinking (Smart Question #1) and the fact that everything you do, and everything your group, team, or department does, is part of one or more processes. The final step in each process is the delivery of something to the customers of that process. I’ll give you a few examples:
- You deliver end-of-the-month financial results to leadership. The leaders are the customers of this reporting process.
- You deliver training to employees. The employees are your customers, as are the leaders responsible for developing your workforce.
- You deliver products to customers through distributors. Both the end users of your products and the distributors are your customers.
- You deliver information to people who contact your call center, so they’re your customers, right? Absolutely—but you may also have other customers such as leaders who expect you to meet certain performance levels and internal departments that want to know why people are calling.
Part of the answer to our first smart question about the process involves considering who the customers…
2Feb2011 | Steve George | 0 comments | Continued
