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Accenture Consulting Customer Centricity Axis of High Performance May2008
Accenture Consulting Customer Centricity Axis of High Performance May2008
Accenture Consulting Customer Centricity Axis of High Performance May2008
1. Consumerism
3. Convergence
• Industry and channel blurring
• (Retailization)
• Category expansion/bundling
• Extended industry networks
4. Saturation
Seller-drive Buyer-driven
• Over-stored/overcapacity
market market
• Liberalization (Europe and
Free Trade)
• Virtualization (Internet)
For most enterprises, growth comes Accelerating product life cycles pose Another factor helping to tip
from developing new customer or market another challenge. The rapid pace the balance of power away from
segments, bringing new products and of innovation means competitive companies is their own success. While
services to market, or driving more value advantage is increasingly short-lived, learning to satisfy latent customer
from current customer relationships. forcing providers to improve the demand—for speed, efficiency,
impact and velocity of innovation and convenience—organizations also taught
The challenge at the center of all these increasing the damage they incur when their customers to expect more from
growth strategies is their volatile target: a launch backfires or a product fails. all providers. Consider how overnight
today’s customer—more elusive, more delivery became the new normal in the
demanding and more diverse than ever. Increasingly, enterprises must also courier business, or how the ubiquity
Even with providers working harder consider a changing consumer base, of online banking has compelled other
to win their favor, customers seem often including entirely new buyer providers to offer around-the-clock
only to find more to dissatisfy them, segments. The demographics of mature service channels. Hotels with check-in
from shoddy toys to stale vegetables, economies are evolving, and companies lobby kiosks, for example, help late
while finding little dissuade them must respond to changing buyer needs arrivals reach their rooms faster. They
from defecting to competitors. Buyers and values. Also, emerging economies also lead guests to expect all hotels to
today tend to categorize providers into are becoming important consumer offer the same experience.
polar extremes—the “distinctive” and markets in their own right, expected to
“everyone else.” Earning a place in the account for more than half of global Customers have even come to expect
distinctive category has become far consumption by 20252. These “new” every provider to meet the service
more difficult and costly. consumers have distinct characteristics standards set by other industries. Few
and may regard foreign brands with
For one, consumers know more—and uncertainty or doubt. Understanding
their knowledge is power. Detailed and appealing to buyers in these 2
Estimate adjusted for purchasing power
differences.
Product and experience define a Competitive moat created around Minimize impact of "me—too"
combination that stands out for customers, who become less price and promotions
target customers sensitive to price and focus on
total value and convenience Entry to new markets/segments
profitably
consumers use multiple cell phones experience. Even when customers view Profitable growth. They will minimize
from multiple wireless companies, for their experiences as fair or good, they the impact of “me-too” price and
example—but they do interact with are quick to leave—as switching costs promotions, and make entry to new,
airlines, banks and a host of other decline, even the most revered corporate high-growth markets and customer
providers, and how they are treated by brands are vulnerable. Conversely, segments more profitable and less risky.
these organizations in these industries consumers identify a differentiated
influences how they expect to be treated experience as the chief reason for In short, delivering a differentiated
by their wireless phone company—and choosing a new provider. To address customer experience is the cornerstone
their grocer, cable company, government these myriad challenges to growth, of cost management, customer
institutions and so forth. successful businesses will transform satisfaction and profitable growth. While
their strategies, workforces and many organizations already understand
and even embrace this concept, many
Delivering the operations to be increasingly customer-
centric. By refocusing on delivering also struggle to execute the customer-
differentiated an experience designed to satisfy the centric agenda successfully.
intentions and preferences of target
customer experience customers—through their marketing, Translating strategic objectives into
sales and customer service functions— sustainable results is what separates
In short, today’s customers demand an they will produce significant, sustainable the merely interested from the leaders.
exceptional experience in return for impact on performance. Organizations striving to become high-
their business and loyalty. Being merely performance businesses will replace the
adequate is no longer adequate. Differentiation. They will offer a traditional focus on customer relationship
combination of product and brand management with a focus on customer
According to Accenture research,3 a poor experience that stands out for target experience management. Like star
customer experience is the most-often customers.
cited reason for customer flight. Our
research also indicates that fully half Loyalty. They will create a competitive
of all consumers leave a product or
3
Customer Satisfaction in the Changing Global
moat around customer relationships; Economy: Satisfying new requirements for high
service provider at least once every 12 buyers become less sensitive to price and performance. Accenture 2007 Global Customer
months because of an unsatisfactory focus on total value and convenience. Satisfaction Survey. 2007.
athletes who change the momentum capability development and execution— All three tenets must have the
of the game with a curve ball, a bit to improve business performance and wholehearted support of the senior
of backspin or a sudden pivot on the build customer loyalty. Organizations management team, and they must be
playing field, they will shift away from may transform at different speeds, but combined in a concerted and holistic
the old transactional view of customer transformation is the ultimate goal. approach that revolves around the
interactions, concentrating instead on entire customer experience and which
the accumulative impact of every experi- To center on today’s customer— crosses many functional areas.
ence—across channels and over time. more knowledgeable, demanding
and empowered—high-performance Accenture has identified five imperatives
businesses embrace three principles. for achieving customer-centric benefits—
Becoming customer an integrated set of new and adapted
centric Customer relevance. High performers
convert advanced customer insight
business capabilities designed and
executed to provide differentiated value
Becoming truly customer centric requires into value through products, services, for target customer segments.
something other than more investment experience and marketing.
in sales training, advertising campaigns Becoming customer relevant.
Execution excellence. High performers Customer-centric organizations rely on
or call center technologies. Indeed,
organize and enable their people and segmentation strategies that replace
companies that have embarked solely
create processes and technological the academic with the actionable:
on implementing CRM solutions have
capabilities that enable them to predictive, recognizable and executable
seldom become customer centric because
deliver a tailored and consistent customer insight.
the other dimensions of their customers’
customer experience.
experiences have not changed.
Delivering the differentiated
Enterprise agility. High performers customer experience. Customer
Accenture defines customer centricity
foster the organizational agility centricity depends on a new level
as incorporating the customer’s
required to effectively value, execute of alignment and integration across
perspectives, values and actions into
and sustain customer relevance. customer-facing operations, including
the business and operations strategy,
marketing, sales, customer service and
supply chain operations.
What is clear, however, is the critical Any company not working to tailor they are doing it in the context of
impact that poor customer service has the customer experience to customer relationship development—protecting
on business performance. Accenture preferences—or any company that still the customer relationships while
research suggests that the majority serves customers the same way it did trimming operating expenses.
of consumers worldwide left at least five years ago—is extremely vulnerable
one provider in the past year because to competition. In our increasingly Accenture has found that achieving
of a bad service experience. However, multi-polar world, competition can widespread, consistent performance
consumers also reward good service: come from virtually any geography, is the result of focusing on three
in our research, consumers identified including emerging economies such as key areas: knowing the customer,
service quality as their foremost consid- India, China, Latin America and Eastern exceeding customer expectations and
eration when choosing a new provider, Europe. In this environment, the ability fulfilling promises to the customer.
and 77 percent reported being much to deliver a satisfying service experience
more inclined to continue doing business may be a company’s best source of Customers want to be recognized for
with a company that delivers a positive sustainable competitive advantage. who they are as soon as they contact
service experience. Yet few companies are distinguishing you: their history, their preferences,
themselves for service quality. their intentions. Leaders, therefore,
Even when customers don’t take the build a blueprint for handling customer
ultimate step of switching providers, Creating advantage through interactions based on detailed
most do not simply accept bad service. customer service knowledge of the customer, and they
When it happens by phone, many execute this blueprint consistently
will ask to speak to a supervisor or Leading organizations, however, drive regardless of how the customer
call back in the hope of getting a growth by delivering a differentiated contacts them—whether they call, come
more helpful representative, thereby experience—designed around customer on line on the web; walk into a branch
increasing call volume and operating intentions and preferences—that is office. This can be tough; at many
costs. Many customers will also tell both satisfying and profitable. These companies, this information tends to
others about their experience—and, in leaders have mastered the new market be scattered throughout the orga-
today’s networked world companies are dynamics that compel them to focus on nization or distributed between the
well-advised to remember the ability becoming customer-centric. They are customer, you and third parties.
that consumers now possess to use the still working to reduce costs but now
Internet to broadcast their criticisms.
Customer Relationship Management 11
Service
strategy
Enterprise
execution
For more information about developing About Accenture Accenture’s Customer Relationship
and successfully executing customer- Management service line helps
centric strategies that help your Accenture is a global management organizations achieve high
organization achieve high consulting, technology services and performance by transforming their
performance, visit our web site outsourcing company. Combining marketing, sales and customer service
at accenture.com/centricity unparalleled experience, comprehensive functions to support accelerated
capabilities across all industries and growth, increased profitability and
business functions, and extensive greater operating efficiency. Our
research on the world’s most successful research, insight and innovation,
companies, Accenture collaborates global reach and delivery experience
with clients to help them become have made us a worldwide leader,
high-performance businesses and serving thousands of clients every year,
governments. With 178,000 people in including most Fortune 100 companies,
49 countries, the company generated across virtually all industries.
net revenues of US$19.70 billion for
the fiscal year ended Aug. 31, 2007. Its
home page is www.accenture.com.