Companies are accustomed and even comfortable keeping internal process opaque to customers―and often to co-workers as well. “Lack of cost-effective technology” has served as a convenient excuse for shutting out customers and blocking communication across silo boundaries – although we know “technology” is just an excuse.

All that’s about to change. A new technology named CBPA (communication-based process automation) is about to tear away the fig-leaf excuses. CBPA will track typically opaque internal processes including: mortgage and loan processing; insurance claim processing; technology support beyond one-call resolution; special orders; back orders; custom fabrication; incident research; and a host of other high-frequency events – each of which generates high volumes of expensive-to-handle customer calls and e-mail, not to mention endless internal e-mail and even face-to-face conversations.

Because it’s all IP-based and outside corporate firewalls, companies will now be able to let customers access CBPA for self-service – and let internal folks track progress across silo walls as well. Gazillions of dollars could be saved, IF individual companies are ready to “bare their process.”

Several industries have already developed vertical fixes resembling CBPA. You no longer have to call Fed-X or UPS to track a package, just hit the web. Likewise for medical test results. But business-at-large continues to spend gazillions of dollars on people and communication infrastructure to handle customers’ “Where is it?” questions and similar internal queries.

Because it’s IP-based, companies will now be able to let customers access work-in-process data themselves – and let internal folks track progress across silo walls as well. Gazillions of dollars could be saved, IF individual companies are ready to “bare their process.”

I’m excited about this because it’s classic Outside-In. Think of a solution to customers aren’t yet asking for; create customer delight; and grab a lead on competitors. But I’ll admit, it’s also Outside-In because implementing this solution will require organizational redesign, staff redeployment and shedding the traditional “protect ourselves from customers” perspective. Well-led, forward-thinking companies can effect these changes. But many others can’t and will suffer customer consequences as a result.

To be fully transparent myself, I got so excited by CBPA’s potential that I’ve partnered with the software developer’s largest partner to launch a process/technology partnership we’re calling “Enterprise Collaboration.” And I’m presenting a free Avtex-sponsored webinar on March 23^rd from 10:00 to 11:00 Central Time (that’s GMT minus 6 hours). You can register @ http://tinyurl.com/yfunttu.

In his great new Book, “Reorganize for Resilience,” Harvard B-School Professor Ranjay Gulati describes how and why companies should be moving from inside-out to Outside-In (he uses Outside-In as a surrogate term for customer-centricity). From his organizational dynamics perspective, he describes four “stages” of this transition. But most marketers aren’t trying to reach the end stage or even the third, but instead are content with stages one or two. Why?

[I’m excerpting from Gulani’s descriptions]

Stage one: Thoroughly inside-out: “(Companies) view the world entirely through the lens of their own goods and services.”

Stage two: Think they’re customer-centric but remain company-centric: “Though they (companies) understand customer needs, they still focus on their products, viewing the customer through the lens of the company’s offerings, focusing on customers’ experience with their purchase while ignoring the larger problems customers may be trying to solve.”

Stage three: Think they’re customer-centric and they are, but not all the way: “They focus first on the problems their customers are trying to solve, only then turn to their products, configuring their offerings to address those problems.”

Stage four: Outside-In (customer-centric) to the core: “A level four firm is more attached to producing solutions to those problems than it is to the products and services it offers. This intellectual, structural and emotional transition means it is no longer concerned whether the inputs it uses to solve customers’ problems are its own or assembled through a network of partners.”

What stage does your marketing support?

Calling corporate customer-centric planning deficient is paying it a big compliment. From Fortune companies to entrepreneurial businesses, and our practice spans both, well under 10% of companies understand even the most rudimentary techniques for letting customers drive the strategic equation, and the true number may be less than 5%. Senior managements at the remaining 90 – 95% plus:

a.) Want to become more customer-centric, but can’t find their way out of traditional, company-centric planning approaches
b.) Are still playing the we-them power game
c.) Let financial planning drive their companies
d.) Are content to spout lots of “customer-this, customer that” bromides
e.) Believe letting middle management implement CRM or CEM or Social CRM or whatever new fad is out there will get them close enough to customers?

Unfortunately, customer-centricity starts with aligning strategies with customers through effective customer-centric planning processes – before it moves through aligning process with strategies and technology with process. Lacking well thought-out, customer-responsive business strategies, companies can’t move off the dime in customer-centricity terms – unless their CEO is Jeff Bezos, Fred Smith, Richard Branson, Steve Jobs or someone else with customer-centricity so baked in their brain they can skip planning and go straight to execution.

Why do we have this problem and what should we do about it?

The Harvard Business Schools “Working Knowledge” newsletter just published an intervieww with faculty member, researcher and pundit Ranja Guloti. The piece is titled, “The Outside-In Aprroach to Customer Service,” with “customer service” referring to all customer interactions (http://hbswk.hbs.edu/item/6201.html). It’s a five-minute read that imparts exceptional wisdom about achieving customer-centricity based on Guloti’s years of tracking both Outside-In and inside-out companies. Everyone concerned about customer-centricity should read and absorb this.

Gulotti makes many incisive points, including levels of customer-centricity achieved along the long journey there. But the two that struck me most are: 1.)  his differentiating between the constraints of nearly ubiquitous  inside-out thinking about customer needs - and how Outside-In lifts these constraints, creating opportunities for truly innovative thinking; and 2.) how organizational silos prevent understanding of problems from converting to action. To the latter point he says:

“As I delved deeper into companies seeking to become more customer-centric, the biggest gap I discovered was the one between awareness and action.”

We see some of our own clients experience “the gap.”  Despite prior alerts that O-I process redesign changes “what” work is done and “who” (functionally) does work – requiring organizational change – we have clients that understand what needs to change and why, yet freeze-up when it’s time for action. The primary culprit? Not being able to bridge functional silos.A primary reason we’ve now adopted an online maturity modeling instrument is to better preduct when “freeze-up” is likely to occur and when not (it’s often tough to read).

Anyway, I’ll shut up so you can read it.

What do computer virus attacks have to do with customer-centricity and customer experience? Not much. To the jerks that just launched the so-called “Softmetalgroup” virus -which locks down your whole computer – “customers” are victims.  No customer-centricity required to lock down your machine while dangling in front of you non-stop offers to “let you out of jail” if you’ll just buy their virus removal program, and then download pornography if you refuse their “offer.” Hell of a customer experience, though.

Double bad luck

You expect that from hackers and other computer miscreants. But in the title I said “Alert X 2.” Technically, “X 2” isn’t another virus alert, but an antivirus alert. While you don’t expect hackers to have an ounce of concern for the havoc they wreak, you do expect your anti-virus company – the one that failed to detect the malicious Trojan horse that triggered to whole sorry affair – to give a rip. But I had the misfortune to be using Spyware Doctor + Anti-Virus from PC Tools, which apparently doesn’t. At least not a big rip.

Infected on a Monday

My computer didn’t cough or sneeze beforehand. About 10:00 a.m. this past Monday morning it just seized up. Tried to activate Spyware Doctor, but the virus had disabled it. Tried to get on the web, but the virus blocked access. Then I tried rebooting in Safe Mode. Still couldn’t run Spyware Doctor but could get to the web. So I uninstalled Spyware Doctor and ran it off the web onto my computer for a two hour plus full scan. Didn’t find a thing. So I Googled the virus and discovered various people near the end of their rope trying to get rid of it. Checked several sites claiming to offer instructions on how to get rid of it. Funny, they were all PC Tools sites, actually. Hmmmm. Can’t stop it from infecting. Can’t detect after infection. But still trying to sell software to get rid of it (you know, free scan but you pay for the software before it will disinfect you). But if it doesn’t find anything, how’s it gonna get you to buy it…? Oh, and I found another site that listed the primary malware files with instructions about how to remove it manually. It was brain surgery in the registry, and I have trouble taking out a sliver with tweezers, so I passed.

Frustrated by a Tuesday

So I went on PC Tools’ website, logged in, and filed a support ticket. No response. Filed again. No response, except to say I already had a ticket number. While waiting, I downloaded client files onto my laptop so I could get at least some work done, while waiting…and waiting.

Finally, I went back on the site looking for an alternative method of contact. I’d seen “Live chat” before but couldn’t find it again. Then I lucked out. I found Live Chat by not signing in but proceeding as if I was still a free trial user. But you can’t use Live Chat unless you are a registered user. Very cagey, showing Live Chat to trial users to get them to pay, but hiding it from people who have already paid. So I got on live chat.

Request after request from them to do stuff you can’t do from Safe Mode, the only place I could do anything. A couple of dropped connections later, the day slipped into Tuesday. They kept trying to send me a “findmalware.exe” file or some-such that embedded Windows protection kept rejecting. Then we remembered FTP, and I was able to import and execute the program, which found pages of infected files. I sent the report to them, and they said I’d hear back from the engineers who were going to evaluate the mess in 24 – 48 hours. Sorta like an ambulance crew driving to an accident and stopping for coffee every 50 feet.

Disillusioned by a Wednesday

I tried to get a status report late Tuesday, but the “chatters” were in the Philippines and the engineers here in the U.S., so all I could get was, “they received your file.” Another technology company that doesn’t know how to use technology, at least not for customers.

Tried for a status again midday Wednesday, after not hearing from them. “They received your file…” I had a sinking feeling my work station wasn’t going to get fixed, at least not by PC Tools, and I had video conferences scheduled for which I needed it. So I threw in the towel and followed a recommendation from Bob Thompson, who runs this here site, and went up on MalwareBytes.com. Cute name. Neat anti-virus stuff, too. Downloaded it, ran it, and was infection-free in 20 minutes.

But I was still honked and pressured a “chatter” to actually call engineering for a real update. “They’ll be e-mailing you shortly.” Can’t wait. And I actually did receive an e-mail a couple hours later. Guess what? My computer was infected. Yup. And they reeled off a long list of files they wanted me to track down and send them for evaluation. How nice. But the file names looked familiar. Guess what. Same file names, at least some of them, from the list of files for the manual removal routine I read back on Monday. And this from a company actively promoting its ability to disinfect computers of the “softmetalgroup” virus. Smelled like dead fish. Or rotten eggs.

Now who treats customers worse? The hackers or PC Tools? And remember before you answer, I didn’t have to pay the hackers.

Of course, management always thinks process is for those “beneath them.” It’s hard to imagine anyone of “Director” rank or higher (never mind the VP level) submitting to having their own work and decision-making influenced by process guidance, except with respect to production quality principles.

But Outside-In is process of a different color. It can and sometimes does provide management guidance for decision-making affecting customers. On more than several occasions C-level execs have adopted our O-I mantra – “Adding value to customers in ways that add value back to the company.” And when they start saying it, they start thinking it – especially when we’ve managed to involve them in a strategic planning process designed to produce customer-centric outcomes.

Driving this question is Toyota – which would have a much brighter near to mid-term future had a pervasive, customers-first process culture guided strategic planning and strategic decision-making, both of which became progressively more customer-insensitive over the past 10 years (at least). And despite those saying Toyota has only to straighten out production to rebound, I don’t think they’ll get much bounce without changing a culture that supports hiding known mechanical problems from customers (and regulators), which resulted in destruction of life and property.

But do you believe that a customer-first process culture – especially one that identifies customer needs, preferences and opportunities before going to literal “process”- can penetrate management thinking on a widespread basis? And if “yes,” what will it take?

Toyota might have been a customer-centric company for parts of the 80s and 90s, or it may never have been customer-centric, which I now suspect.  Toyota thought that understanding what customers wanted to drive; converting that understanding to car design; and then superbly manufacturing cars that fit customers tastes; made it customer-centric – and bulletproof. But two fundamentally flawed asuumption have stripped Toyota of its body armour.  

First, Toyota got caught breathing its own fumes – believing its vaunted Toyota Production System was so scalable the company could grow at will. As stuck accelerator pedals and failing brake systems demonstrate, bad assumption. And these maladies follow a string of other problems that had already stripped Toyota of its top quality ranking.

But second, and I believe much more important long-term, Toyota failed to realize there’s more to customer-centricity than excellent products (which it can no longer claim). Research that David Mangen Ph.D. and I conducted several years ago identifies that customers now consider product excellence and service excellence two halves of the same coin. Without one, companies have neither. And even if it grasped this fundamental truth, Toyota failed to realize that “service” was about far more than fixing cars.

Going back 10-years, Toyota started failing to deliver one of the most important service components – honesty. I won’t go into the whole litany of Toyota subterfuge here. I’m saving it for a full article I’ll write once I’m confident all the major discoveries are discovered. But turns out Toyota has been hiding serious defects from customers and government agencies for years. The company’s behavior has been outright smarmy, going back to 2002 when it tried to pawn off sludge collection in engines to drivers failing to change oil. And even after the U.S. DOT forced them to extend engine warranties to 8 years, they tried to obstruct customer filings. And today, they continue obfuscating like mad. Fortunately, the DOT and perhaps even more so the Japanese Ministry of Transportation, are up to their tricks.

I’ve read many comments from Toyota loyalists (most of whom don’t yet know what Toyota’s been doing, unless they’re reading the excellent investigative reporting in the New York Times), to the effect that “Toyota will snap right back.” From mechanical problems, perhaps. But from deeceptive business practices, I seriously doubt it.

And as a sidebar for process folks reading, Toyota has provided living proof that neither the Toyota Production System nor Toyota’s Lean culture created a customer-centric company – one that puts honesty and integrity with customers on a pedestal, towering above business instincts to put profits first - especially when that means putting customer lives at risk.

“Everyone,” you say? Then what you’re really saying is “no one.” 

Here’s an interesting exercise to prove the point. Build a simple grid with all customer MOTs  listed vertically in likely order of occurrence. (MOTs or “moments of truth” identify customer interactions with sellers that significantly affect customer experience). Next, horizontally list all the functions interacting with customers either directly or indirectly. Finally, in the grid portion identify which internal functions control process and policy at each MOT. 

What does the grid tell you? In 90% + organizations, you have a range of functions, each largely responsible for its own process and policy―without strong central oversight. Inevitably, each unit will have a somewhat different view of what customers should experience and how much to “give” to please customers. And some will have very different perceptions. A classic example is sales wanting quick shipment of orders to meet customer expectations and Inventory Management cutting stocks to the bone to reduce cost. 

Companies presenting multiple faces and voices to customers in this manner or even more subtle ways rarely create sufficiently positive customer experience to minimize churn―and suffering churn in low-demand economic times just multiplies negative effects. 

Since process design and execution (and process-level policy) create virtually all customer experience, should the task of overseeing process consistency fall to process leaders? And if so, what does marketing have to say?

Acceptance is growing for the need to fuse customer-centric planning with subsequent process design to assure complete alignment. Plus, acceptance is already widespread for the importance of melding process and systems design (both systems architecture and application selection and configuration) to assure seamless process-technology alignment.

 Does this imply that senior customer strategists should be cross-trained in customer as well as technology planning to create complete alignment around customers? I believe it does, and in a very strong way.

If you step back and look at the failure of CRM to become “the road to customer-centricity,” inability to align strategy, process and technology around customers – or disinterest in doing so – was probably the second most important factor, after technology addiction.

I have on many occasions in many places and in many ways complimented Best Buy for its ascendancy from a rat hole electronics seller of ill-repute into a very customer-centric, Outside-In enterprise. But an incident today (extending back over more than a week) has stopped me in my tracks.

My dear wife is a private practice psychologist. She’s responsible for keeping case records, billing, filing insurance stuff, etc. While I leave her to deal with practice software selection and maintenance, I do help with hardware and network issues. So when she bought a new, Windows 7 laptop at Best Buy, a place where we spend way too much money (or have in the past), I said I’d network it and add non-practice software. That’s what I said. But when I started trying to introduce a Windows 7 computer into a network of Windows XP devices, reality set in. What a mess. Since I was extremely busy with my practice and traveling, I punted and suggested she bring in the Best Buy Geek Squad to set up the network, install her practice software and transfer data and install Outlook and Word and bring her Outlook data across the network.

So the geeky guy shows up, and lickety split he’s all done. He hands her his card, tells her to call if she has the slightest problem, reminds her their work is guaranteed for 30 days, hops in his bug and geeks off. Fine. Until she goes to download e-mail on her new machine. Outlook wants to download all 20,000 messages in her in box. Oops, better bring him back. Calls him and leaves a message. Then she goes to do e-mail on her old computer, which now won’t boot. Ookay. Wait for callback. One day, call again. Two days, call again. Three days, call the store.

But, up until now, one rogue employee could have been the source of all this.

So she calls the Geek Squad office number (which I would have done days ago). She gets voice mail. Leaves a message. Wait for callback. You know the rest of this. So she finally calls the store, after more than a week. She gets transferred to home theatre. Well, anyone can hit the wrong key. But it turns out the woman in home theatre deals with computers, too. Multi-talented. Not really. She tells my wife she’ll have to pay for a service call. That’s Best Buy policy. Unless she bought the extra cost warranty offered at the register. But there’s my wife with the Geek Squad contract, including warranty, in her fist. Finally this very offputting woman acknowledges my wife does have a guarantee. So she says she’ll schedule something. First available appointment is in 10 days. Never mind they’re disrupted her practice in the worst way. Anyway, after two escalations, and numerous intonations of “Best Buy policy this” and “Best Buy policy that” – and my wife using language she never uses to describe anyone but me - she gets a next-day appointment with yo-yo geek who screwed up initially but wouldn’t call back. But still no assurance she won’t get charged again. Hey, have to see if she screwed up yo-yo’s work *%&@!!

You know, there was a time when Best Buy was trying to take care of customers. But after hearing about all these “it’s all about us” company policies they threw at my wife, it appears they’re no longer trying. Too bad. It was nice having them to write about while it lasted. At least write good things. Now they’re on my “A” list.

Oh, and guess who’s going to be there waiting for yo-yo between 8:00 and noon tomorrow?

Postscript:

He arrived this morning right at 8:00 and manually deleted the 20M messages from the server, using blocck deletes on webmail. Apparently the original mistake is irreversable. Then he smiled and left., turning off the machine.

When my wife ducked out between sessions to check e-mail, she booted up, clicked on Outlook, and received a little error message saying “Operation failed.” No Outlook. She was so angry she couldn’t even pick up the phone. I did. I called Geek Squad Central, explained the situation, and was transferred. Stuck on hold for a long time (listening to some recorded message about “outstanding customer service”). Finally someone picked. Once again, the extended warranty department. Can’t even see into Geek Squad records. Another transfer. More interminable hold time.

Finally, a person! Explained everything again, but this time added, “I want it fixed today.” I’ll let you imagine the tone and volume. Anyway, back he came. Still smiling. Fixed whatever was wrong. We hope. And we still don’t know if they’re going to bill us for additional visits.

Froma company supposedly supporting customer-centric business policies, this sucks.

Post-mortem:

Talked to my wife after this was all resolved (hopefully). Actually she talked to me. She believes the “mistaken” transfers to the “extended warranty” department were deliberate and really represented attempts to deny her rights under the Geek Squad warranty. She has lost all respect for Best Buy. And she is very slow to reeact to stuff like this, whereas I have a faster trigger. I support her view. Based on our mutual experience, believe transferring customers with Geek Squad complaints to extended warranty, where they have no rights, is policy. Best Buy not only needs a serious competitor, it deserves some serious viral communication so customers know what to expect. I’ll say it again, “This sucks.”