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Business Design and Transformation process for growth

I have been privileged to be part of some major enterprise transformation processes over the past decade that have taught a lot about how do you actually enable and enforce change for customer centric, holistic, agile and innovative corporate culture. In the business world we are living in today, brands are created with customer experience and corporate culture. The capacity to serve customers in an omni-channel world the way they want to be served is becoming a competitive requirement instead of being an advantage.. This can not be done with silo organisation with responsibility barriers, split budgets, strict hierarchy, fixed roles and waterfall development processes. Those things are true status quo traps that will eventually kill any business sooner or later.

Just like Jeff Gothelf and Josh Seiden, the authors of Lean UX -book, I got fed up with cases that were perfectly planned but never implemented or the implementation was too far from the plan and naturally didn’t deliver as expected. I’ve also grown out of creating strategies and roadmaps and moved to actual change making. I really love Lean UX. Lean Start-up- and design thinking adjusted to established enterprise environment. Solving real problems, creating customer insights, direct applications and implementing them asap is much more rewarding for everyone involved than just designing the change. Getting results fast accelerate learning, inspire innovation and motivation beyond anything else. The gradual change is also much easier to manage than a complete turnover at once.

The key rules for success are:

  1. Outside-in > understand customers and markets first, then look at your offering, customer interfaces, brand, invoicing, agreement processes, up-sales, cc etc. Be honest and learn.
  2. Bottom-up > The need for a change should be recognized at the board level, however the change learning should start at the bottom – with people who are directly communicating with customers and know their frustrations and understand company’s challenges. Most often they can directly tell you what needs to be changed. Once you know these, you can take it to the board room and be honest again and learn more
  3. Do and learn fast, adjust and improve. Don’t try to get everything right before releasing something. There are no watertight facts before there are real life results. Most things can be tested small before scaling or making major investments before proof of concept. Stay curious and lean even in case of larger enterprise

Based on my experience, this approach works every time:

customer centric management transformationIt is crucial to work you way bottom up in order to obtain actionable insights

Bottom-up strategy creation and implementation

1. Create customer insight. Use customer data, analytics, scoring model, online data, research and any available data sources in order to understand who the customers are how do they behave. If you don’t have enough data, get it, make 1-2-1 interviews or research and mash-up other datasources. Create a customer journey map based on these findings and engage with people who work in direct customer interfaces like sales, retail, call center, research, support, invoicing, credit negotiation, specialists, etc. By connecting these two realities you can see a couple of things:

  1. Who are the customers, what are they doing, how and why?
  2. How does this customer behavior show in your customer interfaces, what are the most important pain points and frustrations customers have and what can you do about it. Once you have the facts, you can see how you can extract painpoints by re-designing the customer journey experience across customer interfaces and how that will reduce costs to serve while also improving NPS. That has a direct bottomline impact. Also, you can recognize opportunities that will help you sell more effectively, improve conversion rates and thus drive marketshare and sales up.

When you have understanding about the customers and you can define Customer relationship-, Customer experience vision, set goals and recognize their impact to revenue and bottomline. The Customer interface and customer analysis becomes the roadmap for better and enables a shared language thru organisation. Everybody can agree with the facts and understand their own role in the customers’ process. The discussion is around customer behavior and going forward, it’s not about blaiming anybody for their decisions in the past. The mandate for change comes frome the customers and dictates what needs to be done. This is why everyone can agree with it and don’t lose face or feel the need to defend prior decisions. In every single case this first part has been capable of igniting inspiration, trust in own capabilities to do meaningful changes and realize them. Insights and understanding create momentum that makes it possible for a company to change fast in a meaningful way. This change is done because people love it and their hearts and minds are burning to make an improvement. It’s not done because management has told employees to change or because the management team has come up with new organisation chart… This route to transformation can be rapidly implemented and the results are quickly at hand. These results justify futher improvement.

It has been interesting to learn, how much silent knowledge, un-tapped knowledge and supressed passion can be found in any given organisation. This capacity can only be realized by deploying the change within the organisation. This is why outsourcing the planning is not a good idea in my opinion. Carrying light inside with a bag doesn’t help, you need to light up the people. Once you release that passion and knowledge in constructive way, it will change the organisation permanently. The way of working will change, it will improve job satisfaction and willingness to push the limits further. At best, it will create a positive cycle for competitive advantage and growth.

2. The next stage is about turning insights and understanding in to systematic Way of Working. This is actually very practical consideration about recognizing responsibilities, ownerships over larger entities, creation of KPI’s and information flows or designing the approach to commercial management in general. Often there are factors like scorecards and conflicting interest in the organisation that need to be fixed, rewarding mechanisms or silo cultures that just need new perspective and solving. Very often dysfunctional organisation has everything in order on the surface, but multiple little things that paralyze the operational engine, innovation, productivity and motivation. Sometimes management isn’t even aware of such issues that could be historical relics that should have been solved ages ago.

What ever there is in the way of working, the new perspective gained in the first stage will help in finding solutions to them. The work is done gradually case by case and the excitement and positivity for change gradually take over the entire personnel. At this point, the company should reach a positive cycle that feeds winning mentality, job satisfaction and capacity to innovate.

3. The first two stages have already revealed the challenges that can be found from systems architechtures and platforms. While the first stage already enables major improvements with UX design and coding, the platforms enable strategic development and automation. This naturally takes more time and is different kind of project, but by this time the needs, benefits and requirements should be selfevident. As the learning has already started at frontend level, the understanding about available business benefits should also be clear for decision making and investment planning.

This kind of change can improve efficiency and productivity very fast without showing anything outside yet. However, when the company is really changing it should also show outside. In my experience advertising is actually very effective mean for internal change communication. The promises that the company gives outloud enforces the internal resolve to follow thru and deliver as planned. Advertising is about communicating the core values and that goes to own personnel, customers and the market. There’s just the question of timing that must be carefully considered. If the advertising starts too early and the personnel hasn’t really got on board, it might have double negative impact:

  1. internal feeling of disconnect between promises and capability to deliver and
  2. customers feeling that there isn’t enough substance behind those promises which could damage the brand and destroy the momentum that would have been available.

Like anything that has to do with people and emotions, these are delicate matters and require consideration. In order to do things successfully you need to have a clear plan but it has to be flexible enough so that it can be deployed in right order.

These transformation stories are truly interesting and educating processes. I’d love to hear your stories and experiences about them. Please comment and share 🙂

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Paradigm shifts in Marketing 2014

Marketing Paradigm ShiftI believe that in 2014 corporate management and board take action and set new requirements for marketing. This has already been the trend for some time, but I believe that in 2014 a tornado hits marketing function in large-scale. I wish you could give your opinion on these. Please, if you disagree or notice that I missed something, comment below. Here they are:

-From campaigns to systemic growth acceleration
-From advertising to operations
-From brand book to brand experience & corporate culture
-From pre-planned year to realtime
-From one way to collaborative & dialogue
-From corporate led to customer led
-From bought audiences to owned and earned channels
-From guessing to proof driven continuous analytics, data and automation
-From promise marketing to customer excellence
-From online to mobile +
-Personal Anological communications become premium experiences at the digital era of minimizing contact costs and diminishing traditional direct marketing
-From selling to servicing – From outbound- to inbound marketing
-From Solo unit to collaborative accelerator
-From second rate corporate practice to management imperative

Let’s take a look at them in more detail:

From campaigns to systemic growth acceleration & From pre-planned year to realtime
Owned, earned and partner mediums offer means to generate constant customer flow and optimize conversions for sales. On-going constant presence and dialogue increase company’s reach, impact and capacity to communicate brand and offering in the digital environment “for free” (Naturally this kind of work requires a lot of work and high quality, so nothing is completely free). The marketing automation technology and continuous personalized communications with customers enable such influence and effect that their role is currently outranking paid media. On the other hand paid media is becoming personalized too. When customer is searching for something and her digital profile gives a high scoring value for certain offering, it is time to bid higher in the digital eyeball exchange (RTB) and get your message thru. The window of opportunity in Customer journeys to purchase could vary from seconds to months and marketing must be present at the right time with a right message. The era of mass media dominated campaigns and corporate led campaign schedules is over. Mass media has an important role in marketing mix, but it’s dominance is over now and continuous communications have the lead in importance.

From advertising design to operations
Advertising has been a unique discipline in the market and creativity is the core of advertising impact. Advertising is corporate led and scheduled work that takes money to publish. In this day and age the first priority should be to concentrate on your customer interfaces and channel strategy. How well does your customer interface meet with customer’s needs and expectations? It is increasingly difficult to say where marketing stops and product starts, and this is a good thing. Marketing & services are integrating and customer interface communications can use advertising means like videos to help customers further. Creativity has is now more important than ever, but the use of creativity is now more targeted in certain context and encounters with customers instead of mass-media with reach.

From one way to collaborative & dialogue & From promise marketing to customer excellence
One way manifests and promising is dead. People don’t trust advertising anymore and the access to information is present anywhere, anytime. In the connected environment we are now living in the old approach to building a brand with advertising doesn’t apply anymore. Brands are not built they are experienced and shared. The transparency revolution that empowered customers, forces companies to actually do better, not to just look better. The measurement of customer value has been a monetary concept for a very long time. Because there has not been technologies or means to measure anything else, that has been a valid approach. Today, customers have new currencies that can also be measured too. Customers can endorse a brand they like, or they can give very visible and durable critical comments about it. Customers have ideas for improvement, they can help you in your development process by giving their opinions while you are just developing a new approach, they can participate and share and by doing so, expand company’s reach and presence in the eyes of potential customers in a very positive way. Customers can help each others too, like web developers have done since the dawn of internet. Open innovation platforms like My Starbucks Idea, Dell Ideastorm or Innocentive have led the co-created product and solution development for a long time already and new, very cost efficient cloud based services like Ideascale have emerged. Social Media and open dialogue with the customers are really making a major difference and consequently forcing companies to do better.

From corporate led to customer led
Think about your self as a customer, to which brands are you truly committed? Then think the other way: “Which brands are truly committed to you as a customer”? I would guess, there are very few, if any that you can think of. Since the industrialization, society’s chance to specialized roles and growth of cities, the availability of options has steadily increased. Early on, the producers could just produce as much as they could as cheap as they could and that was enough. Now we are living in the world where there is too much of almost everything. Just producing at lower cost and higher quality isn’t enough anymore. We have now entered the experience economy that requires companies to adapt each and every customer’s personal lifestyle and needs. Offering everything to everybody equals spamming, and indifference marketing. Such marketing is a statement: “ We don’t really care about you, but here’s everything we got”.  Oracle Eloqua made a study about how often the sales people are actually contacting customers when the time is right for the customer. Majority of contacts are done at completely wrong time. Just being able to recognize that single thing makes a major difference in customer experience and operational efficiency.

From outbound- to inbound marketing
Previously a seller was looking for a customer, now customers are looking for solutions. The all-knowing Google is the most important route to most products and services and Google’s page rank is the key to the gateway to customers. Because all information is now available all the time, people want to check and make sure that they are making a smart decision or they look for options in general. Regardless which is the case, the company does not exist in the customer’s consideration unless it has very high top-of-mind score or preference rate. Most companies don’t. Once customers actually land at your site, the whole game is about conversion, whether you are capable of creating a connection with the customer or directly closing a deal. However, the fact is that people make their decisions and also transaction online and inbound approach to marketing is really becoming a very meaningful approach.

From guessing to proof driven continuous analytics, data and automation
Right now, pretty much anything you do can be measured. The availability of data has exploded while the cost of technology processing that data and making it possible to act on the data has slumped. The most pressing challenge now, is to educate people who know what to do with this capacity. You can track the customer’s transaction history with CRM, online behavior with marketing automation tools and you can even track potential customers with cookies and adapt to their behavior without them giving you any information apart from their actual behavior. You can track people’s organic journeys, interests, motives and landing sites, actually the entire market logic of preferences and customer flows between different brands and demand driving with online & search analytics. The web should be considered as the world’s largest quantitative research panel that is entirely based on actual behavior instead of opinions. Such access to information that is mostly free is really shaking the marketing and business communities in general.

From online to mobile +
There are now more connected phones to internet than computers. Online is now always on and always available. A computer was mostly used at home or office, but tablets and mobile phones are present where ever you are. The app explosion and location availability are now changing the entire role of internet enabling companies to really adapt to customer, time and location. The rise of HTML5 is making all online assets available in very intuitive and user-friendly way in any given gadget or platform instead of doing everything several times for native solutions. The dawn of “internet of things” is at hand and enable customer to have a “Sixth sense” that helps her to navigate in the actual world with more information, directions and advice than ever.  On the other hand it does enable companies to really become truly customer centric.

From Online back to Analogical (Personal Anological communications become premium experiences at the digital era of minimizing contact costs and diminishing traditional direct marketing)
When ever some major change happen, there will be a counter trend. Although everything is now going online and we love it, personal analogue communications are becoming signs of premium customer care and experiences. A simple letter has become rare approach. I was involved in a case where we approached  CEO’s of stock exchange listed companies. It was difficult to think how to get their attention and get to them directly without becoming cut off by an executive assistant. Eventually the solution was simple, a letter with a hand written address and a real stamp. Everything about such approach communicated intimacy and purpose. Such approach is as far as it gets from mass communications and that was exactly the reason why the campaign got 30% pull rate. The same apply to consumer communications. How would you feel, if you got a letter from Google or Facebook, that had a hand written address and a stamp? That would really be something J The person to person communications and customer service over phone are also having similar impacts, in case the service is working well. Although brand are now living in internet, we are still people who create a trusting relationship with other people.  That is a fact we should never forget.

From selling to servicing
We all have been sold to. That is not really a pleasant experience. When you are looking for something you would appreciate someone who would make your need their interest and do the best they can to get you a best possible solution. Sometimes that solution is not delivering the highest possible profit margin in short-term, but it sure does deliver in so many other levels. The customer is much more likely to come back, endorse the company and deliver much higher life time value. Shortterminism is the plague we need to cure. When ever you communicate with your customers, delivering them honest advice will sell more and increase impact of communications.

From Solo unit to collaborative accelerator & From second-rate corporate practice to management imperative
Marketing has been a solo unit that has been concentrating on promotion, brand awareness, -preference and -attributes. Those days are now behind us. The same measures are still important, but the marketing unit is required to take more commercial responsibility for customer interfaces and customer contacts in general. The very heart of marketing has always been the customer understanding. That is now more important than it has ever been. Customer centric business model demands marketing to spread available customer intelligence people operating in all customer interfaces. Management, corporate strategy and operations are now required to have their foundation on customer understanding. Because of this, the role of marketing is becoming a true management imperative and driver for customer centric corporate transformation. These are truly exciting and inspiring times!
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