For many organisations today, culture has become a liability. Although culture is essential for organisational performance and health, a pervasive inability to understand and manage culture in support of business performance has become a significant strategic risk.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry is complete. Across 76 recommendations, the verdict is in: a profit over people approach had established deep roots in the culture of many organisations. With APRA and the broader community seeking effective reform, a question has emerged related to culture: can it be regulated?
Apart from technology, the rise of customer
experience (CX) is the dominant business theme of the past 10 years. Right now,
and for the foreseeable future, CX is king. Ironically, customer expectations
have never been higher yet at the same time, will never be as low as they are
today. As markets converge and as quality, price and service are evaluated
regularly by consumers, what is an excellent experience today will be
acceptable tomorrow and under-par the day after. In short, CX is a journey, not
a destination and a key ingredient for organisations who can go the distance is
organisational culture. In particular, the ability to continually adapt and
evolve as the customer landscape changes is becoming a requisite CX capability.
are always beautifully, wonderfully dissatisfied even when they report being
happy and business is great.” Geoff Bezos, CEO
Over the past 12 months we have been
working with three iconic Australian organisations in three different market
sectors (retail, education and property management) to enable their CX journey
through organisational culture. Whilst fundamentally different organisations,
their challenges are strikingly similar and offer insight to those seeking to build
organisations that can deliver consistently great CX.
The context for these three organisations
had similarities; historically successful and experiencing market
disruption in the form of new competitors and changing customer
expectations. For all of them, the criticality of CX at a Board and
Executive level has been established. A core part of our work with these
organisations included performance culture diagnostics where three
similar cultural patterns relating to CX emerged.
Low confidence and capability to execute cross functional programs of work, or more practically – silos exist that prevent ‘joined up’ customer experiences
Employees who don’t feel empowered to act in the best interests of the customer
An awareness of customer needs/problems, but difficulty responding to these at the necessary pace
So for each of these organisations, whilst they had invested in their CX journey by addressing more tangible aspects of CX (e.g. customer strategy articulation, product development and technology transformation), those ‘counter-customer’ cultural attributes described above had gotten in the way of realising the benefits. This pattern emerges as a ‘competing tension’; being that CX requires a dual focus and investment on both the tangible aspects of CX as well as the development of critical cultural attributes that enable agility and integration. Both are necessary but a tendency to address one without the other is common.
Our evidence base and experience suggest
some key steps organisations must consider to develop a culture that supports
Quality diagnostic: Understand your organisational culture using a quality, systemic performance culture diagnostic. Engagement is not the same. Performance culture lifts the tone of the conversation to enable strategic change. Deep evidence shows that the cultural attributes described above: Cross functional integration, Empowerment and Customer Responsiveness, are highly correlated with CX performance
Performance linked: Connect your culture to your strategy. If you can’t describe the links, senior stakeholders will see culture work in a non-commercial light and will lose interest
Involvement: Ensure those who deliver customer experience are involved in creating culture change solutions. This is critical to both addressing what really matters and getting uptake from your teams
Customer centricity is here to stay, but what that looks like won’t stand still. Building organisations that are customer centric requires intelligent and deliberate investment in culture, in the same way we currently invest in technology and other tangible CX assets. Those organisations and leaders who recognise this and take a medium to longer term view that balances investment across both domains will be the customer kings of tomorrow