In my last blog, I offered a hypothesis about why companies in the Walker Index tend to outperform the broader market indices by a factor of at least 6:1. The theory is that companies that have a customer-oriented culture are more likely to listen to – and react to – the needs of their customers. This creates a virtuous cycle – the needs of customers are addressed, which builds loyalty, which builds repeat purchase (and minimized attrition), which leads to robust financial results, which leads to better-than-average stock price appreciation.
There are a number of elements that have to be in place in order to set this cycle into motion, some of which are more strategically-oriented (such as Relevance and Alignment, which I discussed in my last blog), others are more tactical in nature (such as elements of Information Gathering, which we will look into in a future entry in this series), and still others are a blend of the strategic and the tactical. This is the case of today’s topic, Team and Resources.
There is a blend of both strategy and tactics when developing your customer advocacy steering team. From a strategic perspective, you want to consider:
1) Do we have appropriate executive support and involvement?
2) Do we have representation across the different lines of business and functions in the organization? Is it the right mix of customer-facing and internal support people?
3) Do we have the right leader enlisted to keep the team moving forward?
The tactical aspects relate to the work that is involved – that is, the nuts-and-bolts, roll-up-your-sleeves activities that highly effective teams manage. My colleague Leslie Pagel recently provided some excellent guidelines on identifying the ideal candidates, articulating the task expectations, and outlining how each member should use customer feedback in their role.
The most effective teams that we have seen in our client organizations exhibit a number of characteristics:
1) They have executive support/involvement – The support and reinforcement from the executive ranks is a must-have in order to implement true cultural change.
2) They have diverse, widespread participation – It is not solely a top-down initiative; rather, there are representatives from the entire organization to ensure proper penetration across the entire enterprise.
3) They have the right team dynamic – Smart teams recognize that forming a team is a disciplined, structured process - remember Tuckman’s “Forming-Storming-Norming-Performing” cycle. Working through the cycle will help the team to become a stronger unit in the long run.
4) They understand the “inter-connectedness” of the group – Once the team successfully navigates Tuckman’s cycle, each team member understands the role he/she plays and how they can help each other.
5) They create a network of allies, inside and outside the group – Smart team build and leverage a network outside of the team as well as inside the team. They specifically identify advocates that can help them advance the cause outside of the core group.
The process must start with executive support/involvement and, obviously, the formation of the team. How do the companies in the Walker Index stack up? Roughly nine out of ten companies have executive involvement, and a little less than two-thirds have a formal steering team in place. It makes sense that team formation lags executive support/involvement, as the executive sponsor is the catalyst for the implementation of a full-scale customer strategy.
We cannot really overstate the importance of having the right Team and Resources in place – in fact, without an effective team with the right members, our ability to execute on the remaining areas of world-class customer listening – Information Gathering, Communication, Action and Validation – is heavily constrained. As such, this is an area for careful, purposeful consideration and execution.
In my next entry, I will delve into the notion of Information Gathering and will discuss how the Walker Index companies stack up on some traditional and emerging aspects of the information gathering process.
Mark A. Ratekin
Senior Vice President, Consulting Services