I have heard people use the phrase, “a culture of customer-centric value creation.” When I ask what that means, the answers become fuzzy. So, in the interest of providing a starting point to the conversation, I offer this perspective.
As I work with individuals across many industries, companies, and levels, I find that their approach to business situations can often be categorized in several ways. I believe that two important categorizations with respect to customer-centric value creation are whether they have an internal or an external focus to their work and whether they approach their job as an employee or an entrepreneur. Let me describe each of these in a little more detail.
Internal or External Focus
Most people try to do a good job with their work. Whether it is pride or self-preservation, they want their work to be considered acceptable. But how are the standards of acceptable performance determined?
A person with an external focus will be looking to their customer for those standards. If their work is supporting the activities of a customer-facing process, their customer is the business customer. If their work is supporting the activities of an internal process, their customer is the business unit or department that receives the output of their process. Either way, an externally focused person is looking outside their process activity to determine acceptable performance.
A person with an internal focus will be looking to the job description, the procedures, or the checklist to determine what to do. They do what their instructions say to do, nothing more and nothing less. They do not concern themselves with the impact of their performance on the customers of their business process.
Employee or Entrepreneur
For this discussion, entrepreneurism is not based upon whether someone has started a company; rather it is based upon the attitude they have about their role in the organization. Do they see themselves as on owner responsible for company success or are they an actor playing a role?
An employee sees himself or herself as a role or a position on an organizational chart. They have a prescribed area of responsibility. They have specific assets or activities for which they are responsible. Their attitude is that they have a job to do and they will do it well. Within their area of responsibility, they are willing to act – even improvise a bit, but they will not act outside their area of responsibility without specific direction.
An individual with an entrepreneurial attitude is not focused on just their position in the organizational chart. Rather they are aware of what is happening across the company. They strive to improve the organization’s ability to reach its goals. They feel personal ownership for organizational success. Wherever they see opportunities they either act to take advantage of them, or they influence others to act.
So let’s take these two characteristics and place them in a simple four-block diagram. When we do this we begin to see patterns in the behaviors of individuals.
This is the employee with an internal focus. Their goal is to do their job correctly, as it is defined by the organizational chart and procedures. They often take great pride in their work. However, they do not step outside the boundaries of their work process. They are content with the status quo and they resist change. I believe that this is the majority of the workforce in most companies.
This is the employee with an external focus. Their goal is to ensure that the process in which they are involved is running smoothly. They look beyond the requirements of their own specific activities and determine if their customer is satisfied with the results. If the customer is not satisfied, they seek to satisfy the customer through the assets and resources that they control. These individuals often act as the voice of the customer within the organization.
This is the entrepreneur with an internal focus. Their goal is to increase their power and influence in the organization. They look beyond their current position for opportunities to take on additional responsibilities. Often this is because they believe the work is not being done well by others and that they could do it better. When these individuals have good people skills, they are viewed as leaders in the organization. When they do not have good people skills, they are viewed as power-hungry tyrants.
Customer Value Creators
This is the entrepreneur with an external focus. Their goal is to create as many satisfied customers as possible. They are seeking to understand customer needs and interests and to provide value propositions that address those needs and interests. They can be very disruptive in an organization because they are often advocating changes. Internally focused individuals will often see them as a threat to the existing organization and employees will often see them as undisciplined.
A Culture of Customer-Centric Value Creation
Based upon this model, several questions immediately arise.
- How many people in the organization must be Value Creators to establish a customer-centric value creation culture? 100%? 50%? 10%?
- Can you have too many Value Creators?
- Can you convert people in the other categories into Value Creators? Training? Incentives? Coaching?
- What, if any, operational or governance controls should be imposed on Value Creators?
I don’t have the answers to these questions. I have not seen the inner workings of enough customer-centric value-creating organizations to discern a pattern. But I do believe a framework like this will help us understand culture change that must take place for most organizations.