Chief customer officers (CCOs) are getting more corporate cred these days. But stepping into this rising role comes with challenges. Indeed, the CCO Council has identified six of the greatest challenges these C-suite executives face.
Curtis Bingham, executive director of the CCO Council, offers more than just insight into the challenges. He also offers recommendations for overcoming them.
Are you ready to dive in? Let’s look at each challenge and its solution.
Challenge 1: Defending Value
Bingham’s experience tells him that customer-centricity is not widely viewed as a strategic imperative and the CCOs' contribution to this imperative is far from well-defined. As a result, he continued, CCOs spend more time explaining and defending their values than they spend with customers. Kind of ironic, isn’t it? You may be facing this challenge right now. Here’s what he recommends:
“The CEO and board must recognize the growing body of proof that customer-centricity is the new basis for competitive advantage with demonstrable business results, and then make the CCO a part of this strategic imperative,” Bingham said.
Challenge 2: Leveraging Authority
According to Bingham, the most successful CCOs recognize and leverage three sources of “CCO Authority,” starting with either “Positional Authority” or “Borrowed Authority” and quickly earning authority of their own. Without such authority, he said, cultural resistance to change, conflicting priorities, and a number of other obstacles prevent CCO success. Here’s what he advises:
“The CEO must provide to the CCO significant Borrowed Authority,” he said. “The CCO must ‘earn’ authority rapidly by providing value, demonstrating results at all levels, and effectively communicating the business impact of those results.”
Challenge 3: Gaining Resources
It comes to no surprise to Bingham -- and it’s probably no surprise to you either -- that limited understanding of the types of resources required to transform an organization to customer centricity is the norm.
Bingham said, “CEOs and boards of directors must have realistic expectations of the resources required for a CCO to be successful and make a commitment to supply those resources.”
Challenge 4: Converting Data to Action
In the age of big data and Web analytics, gathering stats is the easy part. Converting that data into actionable insights that drive results is something altogether different. Bingham blames, in part, the increasing complexity of customer purchases and interactions increases.
“Many CCOs struggle to move beyond the voice of the customer and triage to create and implement customer strategy,” he said. “Implementing customer triage and issue resolution processes are critical first steps for CCOs. But then the CCO needs to make powerful allies and initiate cross-functional initiatives to create workable customer strategy that cuts across business units to improve the overall customer experience.”
Challenge 5: Implementing Change
Bingham hit a universal nail on the head when he suggested implementing change is challenging for most organizations and resistance to change is human nature. As he sees it, traditional methods for cultural change including bonuses and penalties help mitigate the resistance.
“Actively engaging employees in the process of change will move the culture from compliance to engagement,” Bingham said. “The CCO must accurately evaluate the company's appetite for change and adjust expectations and program design accordingly.”
Challenge 6: Measuring Emotion and Behavior
Bingham’s perception is that many organizations are good at measuring transactions but customer emotion and behavior are harder to measure and correlate to results. He said this could be the single greatest reason that the CCO role is the most fragile in the C-suite.
“The CEO, board, and CCO must agree upon metrics and measures that balance revenue, profit, and customer loyalty,” Bingham said. “The CCO must effectively communicate and market the value of customer-centric change to the organization to gain further support and adoption.”
Befriending the CEO
We caught up with Dave Fish, senior vice president of Martiz Research, a customer experience research firm, to get his take on CCO challenges. Fish goes back to the “leveraging authority," point and told us the CEO sets the tone for the organization.
“He sets the culture through his or her actions or inactions. If the leader doesn’t believe in great customer experience and actually lives it, how can he or she expect the firm’s employees to? They won’t,” Fish said.
“People are smart, they can figure out if a CEO and senior management [are] really serious about customer experience or just paying lip service. Employees will know it and so will their customers," he added.