Another classic article on Customer Focus - while a number of approaches have evolved over the years, the foundation elements remain unchanged. Again, many organisations 'talk a good game' when it comes customers, customer focus or customer centricity. But as we all know, 'talk is cheap' and 'talk' alone doesn't get the job done. One needs to understand the true requirements for being customer focused. One needs a 'strategic customer relationship management' system as discussed in other of my SlideShare uploads. Hopefully you will find that this article helps to continue to provide a 'directionally correct' viewpoint! Enjoy!

1. It makes good business sense to create and maintain a customer-focused organisation. Gaining
new customers costs more than just keeping your old ones happy, and loyal customers generate
more income. TTeedd MMaarrrraa argues that companies should stop talking about becoming customer
focused and just do it
I
t is possible that the birthplace of
meaningful organisational change
based upon customer focus was Cana-
da during the mid-1980’s. Many
organisations around that time
launched significant programmes for
organisational change around the cus-
tomer. In fact, it was Dave McCamus, then
president of Xerox Canada, who set the
tone and direction when he drew a dia-
gram, in the presence of the group of exec-
utives charged with transforming Xerox
Canada to a truly customer-focused organ-
isation (see figure 1).
What he proposed was a longer-term
approach to running the business. His phi-
losophy was that customer and employee
satisfaction were inextricably linked and
more recent research has convincingly con-
firmed this hypothesis. By taking care of
the customers and employees, the share-
holders will be taken care of as a result of
must look externally, focusing more and
more on gathering real-time information
about customers and competition. The
value of the customer-contact functions
and the engagement processes (eg sales,
delivery, technical support etc) where
organisations interact with their customers
have become critical success factors.
Research has shown that a one per cent
increase in customer loyalty equates to an
average nine per cent increase in overall
organisational profitability. It costs six
times as much to attract a new customer as
to keep an existing one. Do you know how
many positive references your current cus-
tomers give your organisation?
Organisations are waiting for a clear
understanding of the requirements neces-
sary for becoming customer focused. In
that regard, a good starting point for iden-
tifying these requirements is the Baldrige
the higher revenue, profitability and mar-
ket share value being realised. So, what has
happened since the mid-1980s? Not a
great deal, disappointingly. The reality is
that there is more talk regarding customer
focus and its virtues than action. The result
is that in a survey done as recently as 2000
by the EFQM regarding critical strategic
issues facing organisations, senior execu-
tives said that the number one issue facing
them was how to become more customer
focused. The reality is that when the going
gets tough, anything that has to do with
the customer (and staff for that matter)
drops off the table or is put on the back-
burner.
Focus on change
Focusing on the customer is the fastest,
most positive way to create and sustain
meaningful change in an organisation.
Today, to be truly successful, organisations
14 Qualityworld
creating customer focus
customer satisfaction

2. 15
and excellence model criteria. Both of
these best-in-class management systems
contain significant elements directly or
indirectly related to the customer. In fact, if
all the customer-related components were
added up, they could easily represent near-
ly 500 points. In addition, both models
contain customer focus as either a ‘core
value’ or ‘concept of excellence’. Figure 2
highlights at least some of the primary cus-
tomer links within the excellence model.
The cat’s whiskers
What would you hope to find in a truly
customer-focused organisation (see figure
3)? You would first find a customer-
focused culture in operation. Also an
organisation in which people at all levels
had a deep abiding belief in the impor-
tance of the customer and where manage-
ment at all levels were aligning their
actions and behaviour with their words by
making the necessary investments, setting
priorities, engaging customers and allocat-
ing resources which clearly communicate
to all (customers and employees alike) their
resolve to satisfy customers.
This customer-focused culture would then
influence the nature and content of the
organisation’s vision, business plan and key
business objectives. From the business plan
should then flow customer relationship
strategies targeted to those customers you
want most. Companies must ask them-
selves: ‘Where do we want our relationship
strategies to have impact?’ It seems logical
that this is where your organisation
engages the customer. Research by Bain &
Company indicates that it is not unusual
for organisations to lose 20 per cent of
their customers annually if they do not
pinpoint these customer-crucial areas.
Customer sensing processes can be
thought of in much the same way as
whiskers on a cat. Without whiskers, cats
behave erratically and are unable to judge
distances effectively. It is the same with
organisations as often these ‘sensing’
processes tend to be dysfunctional - not
providing the right information in a timely
manner. While there are potentially a num-
ber of ‘sensing processes’ the following
should be considered to be to be chief
among them. They are:
• an enquiry, problem and complaint
management process
• a customer satisfaction/loyalty mea-
surement and management process -
with the emphasis as much on ‘man-
agement’ as ‘measurement’
• a customer contact process - call cen-
tres, customer service or support oper-
ations
The CRM bandwagon
CRM systems are too often viewed as a
quick technological fix, but usually they do
not live up to software provider’s promises.
The reality in many organisations is that
their implementation of a CRM system has
absolutely nothing to do with their inher-
ent belief in the importance of the cus-
tomer in a relationship sense - only an
economic sense. Also, many of the organi-
sations in which CRM systems have failed
to reach their potential, lack any well-
defined customer relationship strategies.
The adage that ‘if you don’t know where
you are going, any road will get you there’
holds true here. The problem is that after
Qualityworld
customer satisfaction
Customer satisfaction
Employee satisfaction
Shareholder satisfaction
Figure 1. The leap of faith

3. those cases where the customer has
been dealing with a competitor
Next is the ‘new’ customer phase. ‘New’
customers have unique needs which are
often not met by organisations. As a conse-
quence, ‘new’ customers are forced to fol-
low a trial and error method to find the
easiest way for them to get what they want
from you - particularly so in the business to
business environment. If the learning curve
for ‘new’ customers is too long and steep,
they may go elsewhere. If they leave after
two years, an organisation will loose
money on the deal. During this phase, the
customer-sensing processes are critical for
monitoring complaints, satisfaction and
the enquiries or requests for service -
allowing a business to respond to the
changing needs of its customers, missed
opportunities, product, service or process
improvements, or competitive challenges.
In the mature phase, there is often a need
to bring new energy or excitement to the
relationship with the customer. Here, find-
spending a considerable amount of money
on a CRM system, organisations get down
the road and find themselves arriving at an
undesirable destination - one where the
cost/benefit is dramatically and negatively
out of balance. Further, the customer-sens-
ing processes of many organisations are
often dysfunctional. They provide poor
quality information regarding customers
which is then utilised to drive poor deci-
sions. In fact, the CRM system simply
accelerates the use of poor information to
make poor decisions even faster.
There are four distinct phases in the rela-
tionship with a customer. First is the
‘attraction’ phase - identifying and attract-
ing what the customers want most. Unfor-
tunately many organisations fail to
capitalise on the opportunity of gaining
two types of information during this phase.
These are:
• understanding the customers motiva-
tion for buying from an organisation as
well as their expectations
• gaining competitive intelligence in
16 Qualityworld
customer satisfaction
These are a few examples around which you can
assess your current practice and behaviour, relative
to those required for true customer focus. Rate your
organisation on a scale of one to five where one
equals ‘we don’t do that around here’ and five
equals, ‘we have a world-class approach to this
issue’. See how you compare:
• management’s actions and behaviours are
always consistent with their words regarding
the importance of customers
• customer and market data and information are
key to our policy and strategy formulation
• the skills and knowledge critical to building
and sustaining customer relationships have
been identified and training has been conduct-
ed for all of our customer-contact employees
• we rate our suppliers based upon the value
add which their input (eg materials, compo-
nents, information) provides to our customers
• our organisation has a comprehensive
approach for ensuring that customer require-
ments are translated into specifications for
new products and services
• our organisation has an accurate, realistic and
comprehensive overview of the total complaint
level (verbal and written) as received by all
areas and all functions within the organisation.
Our data indicates a steady decline in overall
complaint volume over the past three years
• we experience a level of turnover and absen-
teeism among our customer-contact personnel
that is so low, our organisation is considered
‘best-in-class’ in our industry
• management ensures that clear, complete dis-
closures of relevant information are provided
to customers and other stakeholders, such as
communities, on a regular basis
• we track supplier problems that impact our
customers and work with those suppliers to
prevent re-occurrence. There has been a
steady decline in these types of supplier prob-
lems over the past three years
Some questions to ask about your customer-
sensing processes:
• how good are your engagement processes?
• where are your people having difficulty satisfy-
ing the customers they interact with?
• where is the competition doing a better job?
• what are the basic needs and the wants
(those things the customers would really like
you to be doing that you are not) or ways of
adding value (providing a tangible or intangi-
ble benefit the customer recognises)?
• what are your internal process effectiveness
indicators saying?
• are you delivering service excellence across
the scope of your engagement processes?
Leadership
1c
Policy and strategy
2a, 2c
Product and service
design
5c
Customer relationships
5e
Customer results
6a, 6b
Design and
improvement of
processes
5a, 5b
People
3b, 3e
Partnerships and
resources
4a, 4e
Figure 2. A customer-focused organisation (EFQM)
Customer and market
knowledge
(CRM)

4. 17Qualityworld
Ted Marra is president of Marra
Quality Inc, which focuses on
performance and relationship
excellence. He has worked with
over 100 companies helping with
organisational and cultural
change. He has been vice presi-
dent at Walker: CSM, president of consultancy, Care
Associates and of TARP Midwest. In these positions
he concentrated on the design, pilot testing and full
implementation of customer complaint manage-
ment processes.
ing ways to more effectively cross-sell or
fine tune value proposition becomes a crit-
ical success factor. The customer-sensing
processes and a CRM system can work
hand in hand. But there is no logic to
implementing a CRM system and then
forcing the dysfunctional customer-sensing
processes to fit.
Finally, what most organisations should be
striving for is to create secure relationships.
These are ones where the customers would
not even think of doing business else-
where. Even when tempted by the compe-
tition, they remain loyal. Unfortunately
proprietary research among a number of
organisations in Europe, indicate that this
group represents no more than ten per cent
of a company’s customer base. There will
always be some customers which will
leave. The point is to minimise this depar-
ture, particularly if these are the customers
you want most. Examine the reasons why
customers leave and identify patterns of
events which lead to defection. A system
which can detect ‘at risk’ customers will
allow a business to intervene and preserve
the relationship. The longer the customer
remains with you, the greater the revenue
and profitability of that customer.
Customer focus? Easy to say, but more
challenging to do. First, understanding the
requirements is a key. Then building a cus-
tomer system which is sensitive to all the
stages in the relationship life cycle with
customers comes next. Avoid the urge to
jump to a quick fix such as a CRM system
before you have your relationship strate-
gies well-defined and your customer-sens-
ing processes functioning effectively
customer satisfaction
Customer focused culture
Vision, business plan and key business objectives
Customer relationship
strategies
CRM
Customer ‘sensing’
process
Customer
engagement
processes
• sales
• delivery
• service
• others
Customers
Figure 3. The customer system of an organisation Feedback
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