The starting claim is that the traditional value drivers no longer provide competitive advantage. The ages of manufacturing, distribution and information have given way to the age of the connected customer, and everybody talks about customer centricity without knowing whether it drives growth.
Insights2020 set out to answer two questions: what the drivers of customer centricity are, and how to achieve it. Its answer is ten drivers grouped into three dimensions, total experience, customer obsession and the insights engine.
Key findings
- Eighty percent of overperformers link everything to a clear brand purpose, against 32 percent.
- Seventy-nine percent report customer centricity fully embraced by all functions, against 13 percent.
- Customer centricity is a top priority for leaders at 91 percent against 48 percent, but incentives are based on customer KPIs at only 45 percent against 24 percent.
- Experimentation is the weakest driver everywhere: only 40 percent embrace risk and experimentation, against 13 percent.
- Insights functions lead the business at 51 percent against 18 percent, and report into the chief executive at 29 percent against 12 percent.
- The critical capabilities split the same way: business sense at 75 against 50 percent, whole-brain thinking at 71 against 42, and storytelling at 61 against 37.
The study
Insights2020 is described as the largest and most global insights and analytics study conducted: 60 markets, 337 vision interviews and 10,495 survey respondents, with LinkedIn behavioral analysis, Wharton crowd sourcing and eight global research teams working across industries and functions.
The context is the connected society: connected devices rising from 7 billion in 2008 toward 50 billion, with 212 billion sensor enabled devices. The headline result is that customer centricity and revenue growth go hand in hand.
Total experience
The first driver is purpose. Eighty percent of overperformers link everything to a clear brand purpose against 32 percent, and the maturity ladder runs from brand communications, through integration in the total marketing mix, to purpose as a north star for all decisions and finally a societal movement.
The second is data-driven customization: 73 percent create experiences based on data driven insights against 31 percent, on a ladder from one-size-fits-all through segmentation and micro-targeting to full one-to-one.
The third is touch point consistency, at 64 percent against 29 percent, running from a focus on a few moments of truth, through marketing mix optimization and cross-channel consistency, to extending consistency to partners.
Customer obsession
Being embraced by all functions is the fourth driver, at 79 percent against 13 percent. Its ladder starts with customer centricity outsourced to the insights team and ends with seamless alignment with external partners, passing through customer stewardship in customer facing functions and then presence in all functions, processes and decisions.
The fifth driver shows the sharpest inconsistency in the study. Customer centricity is a top priority for leaders at 91 percent against 48 percent, but only 45 percent against 24 percent base incentives on customer related KPIs. The ladder moves from leadership advocacy, through translation into personal measures and incentives, to customer centricity as a key company metric.
The sixth is collaboration, with 72 percent working closely with customers against 45 percent, on a ladder that starts with marketing and IT and ends in co-creation with customers. The seventh is experimentation, the lowest scoring driver on both sides at 40 against 13 percent, where the ladder runs from a risk management mindset to full empowerment.
The insights engine
The eighth driver concerns the standing of the insights function itself, at 51 percent leading the business against 18 percent, and reporting to the chief executive at 29 percent against 12 percent. Its ladder is short and pointed: support, inspire, challenge, lead.
The ninth is unlocking the power of data, where 67 percent can link different data sources to distil insights against 34 percent. The ladder runs from knowing what data you have, through linking multiple sources and integrating online and offline, to predictive and forward looking work.
The tenth is capability, and the capabilities named are not technical. Business sense at 75 against 50 percent, whole-brain thinking at 71 against 42, storytelling at 61 against 37. The ladder starts at research and analytics mastery and climbs through business acumen, creative solution thinking and storytelling to direction setting.
The operating model behind all of this was published as Building an Insights Engine in Harvard Business Review in 2016. Its eight components run from accessing sources and integrating data, through distilling insights and developing strategies, to engaging partners, embracing disruption, equipping for excellence and executing in real time.
What insights has to become
The closing argument asks the function to move beyond insight to inspiration and provocation that enable transformational action. The shifts named are from predicting the future to shaping it, from generating insights to driving outcomes, from risk mitigation to imagining the possibilities, from tried and tested tools to innovative approaches, and from studying consumers to building relationships with people.
The supporting scorecard shows how a company reads its own position: a score per driver, a gap against benchmark, and an ambition, with the aggregate expressed as revenue growth potential.
Scope and limitations
The comparisons are between customer-centric overperformers and underperformers as the study defines them, across 60 markets, 337 vision interviews and 10,495 survey respondents. The scorecard shown carries illustrative numbers rather than a real company’s result.
Source
This page summarises Driving Customer-Centric Growth, by Frank van den Driest, Stan Sthanunathan, Keith Weed, 2016.