Principal, High-Yield Methods
Founder, Vice President, BP Group
Want to watch change in progress? Just look at the turnaround in buyer-seller relations in industrialized nations. Business is having a “Galileo moment.” After assuming for decades customers revolve around companies, guess what? Business is learning its world is round, and companies revolve around customers–at least that’s the rotation for companies planning to stick around a while.
But learning this lesson rarely translates into doing–at least doing enough to become customer-centric. Companies don’t switch to revolving around customers with a memo saying, “Beginning at noon next Monday, we’re going to be nice to customers.” Obviously. But they don’t get there with 1-to-1 marketing strategies, either. Or with sales, marketing and service using CRM software. Or with implementing more customer-friendly service policies. Or with customer analytics. Or with social networking. Or with all the above tactics. No matter what consultants and software salespeople claim.
Moving to a customer-centric business model goes way beyond these incremental changes–and way beyond the comfort levels of many companies. Organizations achieve customer-centricity through transformative change–starting with new beliefs and new cultures, which give rise to new strategies plus new work that converts strategies into actions. And to further the degree of change, new work dominoes change from organizational realignment to redesigned technology support.
Tough to achieve? You betcha. But some companies have already made the transition. In fact, some companies have been customer-centric since formation. They’re the lucky ones. But how did companies having to migrate to customer-centricity get there? There’s one common factor,“Outside-In.” They didn’t call their journey “going Outside-In.” In fact the term only surfaced several years ago, in conjunction with a Virgin Mobile customer-centric initiative. But they’ve all followed the same pattern. Now, more companies are following in their footsteps. And when something new happens frequently enough, spurred by champions “spreading the gospel,” we give it a name (hopefully not a three-letter acronym). Hence “Outside-In.”
So what is it?
Outside-In is the fusion of planning and process design into one, integrated, customer-centric activity.
The planning part redesigns strategies from a thoroughly customer perspective. And by “strategies” I don’t mean marketing, promotion, branding, stuff that advertising agencies do. I’m talking products, services, delivery, in some cases core business direction–all invented or renewed with an adult dose of innovation. It starts with “finding your inner customer,” “seeing through customer eyes,” “standing in customer shoes,” or whatever you want to call it. And results in companies raising the competitive bar, often high enough that others can’t clear it. If, that is, new strategies trigger new work.
That’s the process piece. Defining what work should be done to implement new strategies; who should do it; how it should be done; and enabling technologyrequirements. Some call this “customer-centric infrastructure,” others “customer-optimizing operations,” but it doesn’t matter. Just no TLAs.
Worked together, these two Outside-In elements align strategy to customers; process to strategy; and technology to process–creating the spine of a customer-centric company.
Outside-In creates a framework for designing, organizing and simplifying the migration to customer-centricity–true customer centricity. The type that adds new value to customers as the only reliable means of adding new value to the company. Not that the transition is ever “simple.” But business will have to get there. Because when one player in a sector goes Outside-In, others will have to follow, or risk being left to an unhappy fate.
Just look at what happened to consumer electronics chains in the U.S. once Best Buy went Outside-In. Circuit City and CompUSA might as well have been bugs beneath a work boot. Squish. But that’s the usual fate when a competitor beats you to putting customers in the center of your business circle. Squish.
True, some companies survive by scurrying to change reactively. UPS has stayed profitable while scrambling to match customer-centric moves by FedEx. But how many companies have the strength and resources of UPS?
Despite the probability of facing dire consequences sooner or later, many change-averse companies continue to sit rather than change. As a past client once said to me, “I know we have to change, but we can’t stop doing what got us here.” They circle the wagons to protect themselves from customers fighting to take over the center of their circle. Or, perhaps a better analogy, they engage in a tug-of-war with customers over who controls buyer-seller relationships. Just one problem. There’s an 800 pound gorilla on the customer end of the rope, and she ain’t budging. And just wait until she gets impatient and starts pulling. When she does pull, companies will have to get Outside-In quickly, if they’re not already–or risk going upside-down.
Don’t wait until you’re forced to go Outside-In. Proactive change works so much better than reactive. Twice the gain with half the pain. So best to get a handle on Outside-In now, while you can still leave competitors behind.
 We italicized the four Outside-In process components because they represent transformative change in the process world. This isn’t your father’s process. For that matter, it’s likely not yours–yet.
Dick Lee is the founder of High-Yield Methods, a Outside-In consultancy focused on helping clients align strategy with customers, process with strategy and technology with process. In 1996, HYM launched the first, formal, Outside-In process approach, Visual Workflow. In addition to consulting with clients including American Express, Honeywell and Microsoft, Dick is a speaker, educator and author of several books and numerous white papers and journal articles.
Dick is an Executive Advisor for Towers Associates and sits on the board of the BP Group.
Steve Towers is the founder of the Business Process Management Group a global business network exchanging ideas and best practice in Business Process & Performance Management, Transformation and Process Improvement. He works with many of the leading fortune 500 companies as a mentor, coach and sometimes consultant specializing in the implementation of performance improvement, process change and transformation. He has written several books, many business articles and appears on radio and TV. Steve previously worked for Citibank where he led restructuring and business process transformation programs both in the US and Europe.
Steve is an Executive Advisor for High-Yield Methods and sits on the board of the BP Group.
The BP Group
The BP Group is a global 'not for profit' business network originally founded in 1992.
As a 'not for profit' the vision is to connect and network people interested in significantly improving organisation processes and as a consequence business performance. Our mission is to help improve individual and corporate performance through advanced process management.
Let's turn our attention instead to making people happy and for that we need a candidate organisation who know precisely how to create and manage call centres and the resulting activities. This is also derived from ARG's research and provides useful pointers to all of us who need to intereact with customers via the phone.
Every telephone operator at Cabela's speaks English, and a customer never speaks to a machine. "Every single call is answered by a live person," Ron Spath, VP Customer Relations, states "We don't have any interactive voice recorders and there are no menu's. The feedback from our customers is very clear about how they appreciate not having to waste a lot of time to someone who speaks broken English. We realise that outsourcing these calls to india costs less but we think it is a good investment to pay more in order to save customers time."
To cap it Cabela's, the worlds largest outdoor retailer, even prints its telephone number on the front and every page of its website. Just imagine that, a company who actaully want to talk and learn from their customers.
This positive Outside-In approach pays on the bottom line and has seen Cabela grow to being the world leader in its market in just 50 years. You can read the story at http://bit.ly/xHYzL
So is it that hard to do. Actually let people talk to people that really understand?
Peter Drucker famously opined that the greatest risk to organizations was neither doing the right work wrong nor doing the wrong work but not seeing or reacting to profound change occurring around us. Today, we're in such a period of transformational change, with a powerful confluence of forces driving up the power of customers in buyer-seller relationships—and correspondingly depressing the potential for sellers to stay competitive while putting their own interests ahead of customer interests.
That this change is occurring is almost beyond debate. But how to effectively respond to this sea change is not only a matter for debate, but a source of great frustration for sellers. Fortunately, a growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threat—and using an approach becoming known as "Outside-In Process" or just "Outside-In" to build bridges extending out to customers.
Profiting from putting customers first
Since 1996, when it brought its first commercial product to market, Gilead Sciences has been among a group of companies providing pharmaceuticals to treat medical problems resulting from HIV-AIDS. But in 2006, Gilead leapt ahead of the pack by introducing a new drug developed not just for medical efficacy, but to improve quality of life for AIDS sufferers while also increasing patient compliance with following what had been an extraordinarily complex drug regimen.
A growing number of companies are showing the way by proactively treating the rise in customer power as an opportunity rather than a threat.
Gilead stepped outside of outcomes data and all the standard product development protocols to see medication through patient and physician eyes. And what it saw was patients taking its own "drug cocktail" in 17 different daily doses that required exact sequencing, including some via IV. And what Gilead also saw were patients unable to follow the regimen and falling off their medication as a result. Classic Outside-In vision through customers' eyes. And classic Outside-In customer problem identification that lead to both a medical breakthrough and a customer breakthrough.
Access the full article here > http://bit.ly/fnmU0 <