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 their expectations throughout the customer life cycle, and how you measure your performance in these areas to increase satisfaction and engagement.

Creating value for your customers requires, first, a rock-solid understanding of what they value and, second, effective processes for delivering that value. As Baldrige Award winners have shown, companies that integrate Baldrige demonstrate their ability to create value for their customers by industry-best performance on key measures of customer satisfaction and engagement.

The ten most positive brands identified in the Meaningful Brands survey and the Center for Positive Marketing index are shown below.

Meaningful Brands: (1) Ikea; (2) Google; (3) Nestle; (4) Danone; (5) Leroy Merlin; (6) Samsung; (7) Microsoft; (8) Sony; (9) Unilever; (10) Bimbo

Center for Positive Marketing: (1) Wal-Mart; (2) Facebook; (3) Google; (4) Visa; (5) McDonald’s; (6) Yahoo!; (7) Coca-Cola; (8) Amazon; (9) Microsoft; (10) Kellogg’s

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 to deliver high levels of satisfaction at all stages of the customer life cycle.
• Customer complaints are sought, captured, and analyzed to improve processes and increase customer satisfaction.

Common problems areas:

• The lack of a rock-solid understanding of customer requirements produces a shaky foundation upon which to build customer relationships.
• Customer support requirements are not identified, validated, or systematically deployed, which leads to support failures and lost customers.
• Companies settle for satisfied rather than very satisfied customers, which makes it harder to retain customer and build relationships.

To read more about building customer relationships, click on these articles:

• Meaningful Innovation
• A Baldrige View of Customer Experience
• Seeking Very Satisfied Customers
• Kano Satisfaction Model
• Bottom-Line Value of Customer Engagement

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 groups, customer advisory panels, and other forums.

Common problems areas:

No processes are in place to systematically listen to customers and to analyze and communicate the information from those listening posts.

There is little or no follow-up on interactions with customers, making it difficult to identify opportunities for improvement and to make needed changes.

The methods used to determine customer satisfaction provide little timely and actionable information.

No processes exist to detect when a customer is dissatisfied, capture information about that dissatisfaction, take steps to keep the customer, and fix the process that caused the dissatisfaction.

To read more about the Voice of the Customer, click on these articles:

KEYSTONE: Customer Knowledge

Dangerous Assumptions about Your Customers

Smart Question #3: Who Are Our Customers and What Do They Require?

Be Careful How You Measure Customer Satisfaction

Best Practice in Measuring Customer Satisfaction

Fast Food Customer Focus

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 groups, customer advisory panels, and other forums.

Common problems areas:

• No processes are in place to systematically listen to customers and to analyze and communicate the information from those listening posts.
• There is little or no follow-up on interactions with customers, making it difficult to identify opportunities for improvement and to make needed changes.
• The methods used to determine customer satisfaction provide little timely and actionable information.
• No processes exist to detect when a customer is dissatisfied, capture information about that dissatisfaction, take steps to keep the customer, and fix the process that caused the dissatisfaction.

To read more about the Voice of the Customer, click on these articles:

• KEYSTONE: Customer Knowledge
• Dangerous Assumptions about Your Customers
• Smart Question #3: Who Are Our Customers and What Do They Require?
• Be Careful How You Measure Customer Satisfaction
• Best Practice in Measuring Customer Satisfaction
• Fast Food Customer Focus

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 being customer-focused, click on these articles:

• Dangerous Assumptions about Your Customers
• Smart Question #3: Who Are Our Customers and What Do They Require?
• Customer Culture as Differentiator
• Kano Satisfaction Model
• A Baldrige View of Customer Experience

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 training, financing, and advice to new dealers and encourages them to expand. Murphy says that “investing in customer service helps bolster the kind of brand image Red Wing wants to build.”
• It plans to add 125 new stores over the next five years.
• The company also has 3,000 independent retailers and direct sales to nearly 2,000 corporations that contract with it to outfit their workers. Its 200 trucks are mobile shoe stores that visit auto plants, construction sites, and steel mills on a regular schedule, fitting employees for new boots and shoes.
• Red Wing’s casual work boots have become hot sellers in Europe and Japan, where white-collar, 18-to-35-year-old men wear them after work with expensive jeans. Eight-five percent of the company’s casual shoe business is done outside North America.

Companies are naming Chief Customer Officers to address unhappy customers and/or accelerate growth. The Red Wing Shoe Company shows another proven approach to achieving those goals.

To read more about customer focus, click on these articles:

• Do You Have – or Need – a Chief Customer Officer?
• A Baldrige View of Customer Experience
• Dangerous Assumptions about Your Customers
• Seeking Very Satisfied Customers
• Smart Question #3: Who Are Our Customers and What Do They 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 micro level — profound knowledge of what customers require of each process. Plunging ahead on the assumption that you know these requirements puts your organization on shaky footing.

To read more about understanding customer requirements, click on these articles:

• Smart Question #3: Who Are Our Customers and What Do They Require?
• Kano Satisfaction Model
• Be Careful How You Measure Customer Satisfaction
• Walk in Your Customer’s Body Armor
• KEYSTONE: Customer Knowledge

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 of the process are and what they require. If you then ask our second question about your findings—how do we know that?—you often discover that you don’t. Common knowledge is a poor replacement for verifiable facts and yet, most organizations assume they know what their customers require without ever really checking.

That brings us to our third smart question: Who are our customers and what do they require?

Let’s say you’re in a meeting and the group has been bumbling around for what seems like an eternity trying to prioritize the issues in front of it. Ask the question—Who are our customers and what do they require?—because being clear about who you are serving and what they expect can determine your priorities. Remember, your department and your group and the processes you are discussing exist to serve customers. Meeting their requirements comes first.

But don’t stop there. As soon as you ask the question, people are going to volunteer their opinions, which may or may not have anything to do with who you are actually serving and what they actually require. Opinions are not facts, no matter how confidently they are presented. If your group accepts them as facts, if you assume that you know what your customers require without the evidence to support it, everything that follows is built on a shaky foundation. Your priorities are suspect, your plans are suspect, and the likelihood that things will improve is suspect.

So ask, “Who are our customers?” and “What do our customers require?” and then ask, “How do we know that?” (Smart Question #2)

If these questions trigger that “deer in the headlights” stare, you will need to be prepared to lead a discussion of why reliable knowledge of customer requirements is important and how you can go about acquiring that knowledge. You can learn how to do that by reading The Baldrige Edge, which is free by signing up in the box on the right.