Degrees of customer-centricity in today’s business world
Born in the ’70s, “Customer is King” was the business mantra I grew up listening to. But it no longer seems to be the case. While the advent of the Internet has been the biggest disruptive force to hit the world of business, there is a lot more behind the journey of the business world to where it is now.
Acceptance And Adoption Are Key
There are two factors to be clearly understood and even wary about when driving a business enterprise to its success – acceptance and adoption. In the brick and mortar model of business, it is extremely difficult to foresee changing customer preferences or what factors would drive customers to change their preferences.
A simple example is the Indian film industry. A commercially successful movie was supposed to have a certain number of action sequences, songs, dance scenes, emotional scenes and comedy. It was the blueprint for success in Bollywood (and still is in some regional film industries) until a first time director (Farhan Akhtar) shattered the stereotype in 2001. It was the fear of acceptance that had kept Bollywood from evolving out of the rut it got stuck in. Same was the case with the world of business as well. The same fear of acceptance kept Kodak from disrupting its own business model by embracing the digital camera before it was too late.
The increased adoption of technology in business made collection of data from business easier and software applications made it possible to collate data from different business segments, analyse them and understand what factors are driving businesses up and down. Adoption of the internet and the advent of eCommerce finally broke the fear of acceptance and adoption as online stores do not even cost a fraction of the brick and mortar ones.
One fear gave way to a new one – customer support and satisfaction. As customers started adapting to technology and accepting new and radical products, it became imperative to measure and understand how satisfied the customers are. Back in 2004, my life was meandering through regular IT support jobs when I was hired for the project of a European client, at a time when I had no idea that IT support services were getting outsourced.
One incident changed my professional life and helped me understand my way ahead. One of the client’s software applications had stopped working and it was reported to the support team I was part of. We worked on the issue as per the priority on which the issue was reported. When we informed the client that the issue was resolved, we got the feedback that what we worked on was an invoicing application and in the time we took to resolve the issue, they had lost a number of orders. The problems associated with it were manifold. Poor understanding of client’s business applications, wrong prioritisation of their issues; all of these stemmed from the lack of understanding of client’s business environment and their requirements which led to the support team working on an issue with no understanding of its business impact.
In my next job, I worked on a product in a client’s environment for more than 2 years and was able to create a new system design for the product’s upgrade in a few hours, not merely because of my knowledge of the product but because of my understanding of the client’s business environment and the needs of its different business units. When I was sent to a client’s premises in the UK as the leader of a team for a large transition program, what was important to me was to understand the client’s business environment and what technical issues were currently affecting the client’s business.
As the client’s entire IT activities were getting outsourced to the company I was working for, it was just common sense for me to understand and resolve existing issues before owning the responsibility of the environment.
That was back in 2010 and technology has come a long way from that time. This is the age of AI and Analytics and putting them together has resulted in predictive analytics which is helping businesses to make informed decisions and make successful plans for their future. But how much of all of these have filtered down into the traditional brick and mortar stores?
At home, we buy groceries on a monthly basis from a grocer we have been a customer of for 15 years. For daily purchases, we go to a nearby supermarket store. There is a particular pattern to the items we buy from the supermarket store, like milk, eggs, bread, etc. but more importantly, there is a pattern to the items we do not buy, like cooking oils, pulses, rice, wheat, soap, etc. No one in the store has asked us yet where we buy these items from. To be successful in business in these times, companies have to be at the top of their game and continuously keep looking for opportunities to be innovative to not only attract new customers but to retain them as well.
Why Local Grocers Are Here To Stay
I received a call from an aspiring startup’s co-founder some time back for advice. They were planning to create an online platform from where anyone could place an order for any item and they would deliver it. The word anyone was a concern for me. There is a very good reason why India will never be a completely digital market – people’s purchasing power or the lack of it. A big chunk of its population of people makes their daily purchases on debt. The local grocers keep accounts of these purchases and people keep paying as and when they have money with them. Even the local restaurants in many places especially the smaller eateries do the same. This is a business model supermarket stores can never replicate and hence they can never erode the relevance of local grocers and small-time traders.
This is an important reason why the India government’s decision to demonetise its currency notes has destroyed India’s economy as it has further weakened people’s buying ability. When I mentioned these aspects to the startup’s co-founder and asked him how he was going to tackle them in his business model, he had no answer. Borrowing or getting inspired by a business model in another country is fine, but there can be no excuse to not knowing about their own country’s business nuances.
As products and companies of all sizes throng the online market and jostle for space to find their feet, nothing is more valuable in business now than customer loyalty and repeat customers. One look at Amazon’s fulfilment centre is enough to understand the complexity of its customer-centric business model.
More than the number of its business segments, what is mind-boggling is the fact that an individual could be its customer in multiple business segments and would expect the same level of customer service across all business segments. Multiply this by the probability of doing business with a few thousands or a million such concurrent customers and maintaining the highest quality of service across business segments is beyond comprehension.
Is customer still the King or has business become the Emperor of the King?