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The Berg Consulting blog - information, opinion and the latest news on innovation strategy and leadership.

Technology is not the innovation

Robynne Berg - Wednesday, June 29, 2016

 

If you’re a decision-maker in your organisation my guess is that you’re already looking to your mid horizon and observing the approaching wave of change and disruption headed your way.

Digital disruption is reshaping our economy and workforce and shifting the boundaries of competition. It is increasing the rate of societal change. And it’s changing the way we do business. Deloitte estimates that 65% of Australia’s economy will feel the impacts of digital disruption by 2017*.

So it’s not news to anyone that the only way to respond to digital disruption is to adapt and innovate.

And that said I think many of us are missing the central point in the innovation debate. Because we’ve erroneously made innovation synonymous with technology. The innovation discussion has been almost entirely subsumed by references to digital communications, digital platforms, big data and social media.

As a result we’ve lost sight of a greater truth; that technology is changing us as people, as consumers and as a society.

While technology is fundamentally important to our businesses and should be a key focus of strategy and operations, we also need to look beyond it.

Because technology is not the innovation; rather it is the driver and enabler of innovation.

What we need to be more cognisant of is how digital technology is changing us; who we are, what we care about, what we value.

Over recent years the increased access to information has given consumers more choice and more power. Today’s customers – business and consumer -  have an expectation we will tailor our products and services to their specific needs. Because communications are instantaneous they expect us to respond to them in real time (via the communications channel they choose).

And the convergence of digital and social is creating opportunities for companies and customers to create and participate in shared communities of interest. Increasingly we see customers not just commenting on products, services and experience but also reaching out seeking to participate in communities around products or ideas they care about.

This is exactly what we should be tapping into: the changing expectations  and needs of customers, and their willingness to communicate and share their ideas.

Innovation begins not with technology but with the creation of innovative customer value. And the creation of customer value is dependent on a deep insight into customers and their changing needs and expectations. It is the result of deep immersion into customers and their world.

Those insights can lead to the creation of new and innovative value; value that may well be enabled and facilitated by the wonders of technology.

Technology should be considered from two key perspectives:

Firstly, how is technology changing our customers and broader customer markets, both now and into the future? How will it shape what customers value, what customers need and how they behave?

Secondly, how can technology help us to deliver exceptional customer value both now and into the future? How can we apply technology to know customers better, communicate with them more meaningfully, and create products, services and experiences that provide exceptional customer value? How can technology help us extend into new markets spaces and capture new demand?

Alone, technology is just innovation without value. Start with the customer and technology creates innovation that is valued – the only type of innovation that succeeds.

*Deloitte Digital Whitepaper ‘Short Fuse, Big Bang’ and ‘Harnessing the Bang’.Click here

 

Why innovation shouldn't be this hard

Robynne Berg - Tuesday, June 28, 2016

 

In my engagement with CEO groups and leadership teams I’ve found there to be few CEOs for whom innovation is not a priority. Yet despite business smarts, good intentions and a committed team behind them, leaders often find themselves wrestling to find and execute the right ideas for growth.

Many leaders speak of placing enormous pressure upon both themselves and their teams as they pursue an innovation agenda. Many share a story of relentlessly pursuing innovation only to find the strategic conversations becoming bogged down and the ideas becoming increasingly complex. Subsequently teams feel overwhelmed by the task and the process breaks down. Disheartened teams turn their focus back to operations – where organisational knowledge and competence historically lies.

So why is innovation so hard? And why do so many committed leaders and teams find themselves running out of steam and abandoning their innovation efforts?.

One day, whilst discussing this problem with a client I noticed as he talked about his team’s innovation agenda he directed his gestures and eyes to the far corner of the room – as if pointing to a far horizon. It finally dawned on us – perhaps the reason innovation was so difficult was because we were focusing on far horizons: too far away from our business.

I think we too often speak of innovation in abstract terms believing that innovation is about searching for completely new ideas. As a result a team may come to perceive innovation as an Odyssean journey to far distant shores.

I have come to learn that far from being located on distant shores, innovative ideas and great discoveries – the ones that transform your business and create growth – are generally right in front of you.

Reframe what you know

Innovation is sparked not by new knowledge but by reframing what you already know. Often there is little need – at least initially - to go in search of new data. Instead innovation is about observing with open eyes and mind what is currently going on in your business, your industry, for your customers and the world at large and then reframing that data to gain new insights.

Reframing is not unlike a stereogram, where you look directly at a picture and shift your focus until the 3D picture is revealed. The picture itself doesn’t change, but what you see within it does.

So how do you reframe? You do so by looking beyond the assumptions and biases about your business, your customers and the industry in which you compete. We unaware of our assumptions and biases because they are firmly grounded in past experience and adopted as fact. As such identifying your personal and corporate assumptions requires practice and focus. I think this is where innovation frameworks and tools can prove valuable. Frameworks and tools won’t of themselves create innovation; but they will guide strategic conversations helping you and your team to look beyond your shared assumptions to see new pictures in the ‘data’.

Using tools to reframe

A really effective and simple innovation tool that I often use (and that you can easily do yourself) is to ask teams to list all their assumptions about an aspect of your business (eg: a specific product or service that you offer). List all the assumptions you can think of: the product/service features; how it’s priced; channels to market, etc.

Now, it’s not quite as easy as it seems because our deepest assumptions can be hard to detect. For example hotel owners will often not realise that a key assumption they hold is that a hotel requires a building (Airbnb has successfully debunked that assumption).

I’ve found that once teams develop a skill for detecting their assumptions, they can then move on to reframing their products and business models by eliminating, scaling or re-imagining those assumptions. I’ve been amazed to see where teams can land after they’ve worked on a simple tool like this for an hour.

So next time you or your team find that the innovation process is getting too hard, my suggestion is to gather the team and start by listing all the beliefs and assumptions you have about your business, your industry and your customers. And then start a reframing process to see if new insights and ideas come to the surface. Stick with long enough and they are sure to do so.

Innovation, as you will find is not that far away. In fact it’s right here in front of you. You don’t need to go anywhere. Just get your thoughts together, along with paper, markers, post-it notes and a few willing colleagues and you’re set.

And leave the Odyssean journey to Ulysses

Steps to customer-centricity - the customer experience

Robynne Berg - Wednesday, December 02, 2015

 

In a business environment that is asking managers to constantly adapt to new technologies, new competition and changing customer expectations, a customer-centric culture has become paramount. Managers must learn how to develop a customer-centric mindset, culture and strategic positioning if they are to grow their businesses (and indeed their careers).

One of the challenges to building customer-centricity is the tendency to fall back on traditional ways of doing business. I’ve seen some organisations design operational and customer service models based around their traditional processes and then overlay customer experience like a checklist that is then ticked off. It’s understandable, because it’s the way they’ve traditionally looked to creating customer processes.

But if you want to create a customer-centric organisation you need to  build operational processes around what the customer is trying to do (not the business).

There are three key steps that can help you build customer-centricity and bring a customer strategy to life. In my past two posts I spoke about the first two steps (see links below).

  • Putting yourself in the shoes of the customer (customer personas)
  • Understanding how customers experience the world (customer empathy mapping)
  • Understanding customer experience with your industry and/or business (customer experience and utility mapping).

Today I talk about the final of the 3 steps: customer experience and utility.

Understanding customer experience and utility is the most critical of all the steps because its where you connect the customer with your business. Customer experience is about looking at the customer experience holistically. Utility is about customers deriving value (or lack thereof) from an experience with a product or service.

Customer Experience & Utility

Understanding customer experience can help you create customer value and innovation in three key ways:

  • Creating better customer service. Understanding customer experience and utility can help you refine your current business processes so they respond to what the customer is trying to do rather than activities of the business.
  • Create differentiated value. Understanding current customer experience and utility within your industry can help you identify current customer pain points and unmet needs (note: these insights are very rarely picked up in customer research). These insights lead to value creation that exceeds current industry standards.
  • Create new value innovation. Bring customer experience and utility to concept development of new products or services and you can create  exceptional (and differentiated) customer value.

Each of the above situations is about making business decisions while looking through the lens of the customers experience rather than the business. It gives you a concrete understanding of where the opportunities for improved customer value and experience lie.

Customer Experience & Journey Maps

There are a number of different customer experience/utility maps or customer journey maps available. Some are designed for high-level strategic discussions (ie: to create differentiated value or new customer value). The Blue Ocean Strategy Buyer Utility Map is a good example. It groups customer value into to six key utility levers. It encourages you to look to the blocks to utility (ie. pain points or work-arounds) against each step of the buyer experience cycle.

Customer Journey maps are more detailed and excellent for crafting new customer experiences and service design. After mapping a customer journey you consider the low points and high points of customer experience. With journey mapping you also consider customer touchpoints against interfaces, backend processes and operational policy etc. The customer journey map will help you to improve current customer experience or design  new products and services that customers value.

I suggest you bring various customer journey tools to strategy and operational meetings. You will soon work out which map is the most effective for which strategic conversations. Each will help you transition from a business-centric to a customer-centric organisation more effectively.

Download Buyer Utility Map template
Download Customer Journey Map template

Read past blog – Steps to customer-centricity - customer empathy
Read past blog – The first step to customer-centricity

Why you shouldn't love your customer

Robynne Berg - Tuesday, December 01, 2015

 

Last week I attended a digital innovation conference. It brought together a series of thought leaders, digital agencies, successful companies and start-ups. It was a fantastic event with one exception: an oft-flouted phrase that really disturbed me.

A couple of presenters spoke in impassioned tones about ‘loving your customer’ – stomping home the message with ‘Love your customer’ emblazoned on slides above their heads. As one agency head said: “You gotta love your customer and ask them what they want”. I grimaced.

I felt myself catapulted back to the memory of a blind date in my youth. The young man once snagging a first date couldn’t help but profess his love there and then over the phone: before he had even met me. Needless to say I was a little shocked and should have stopped it there. But given I’d already committed I went on the date. Over a couple of exhaustingly long hours the young lad waxed lyrical about his achievements and personal qualities whilst he fawned over me and groped for approval. Needless to say it was the only, albeit numbingly memorable, date. I was insulted and infuriated. Why? Because I knew this kid didn’t ‘love’ me, or even ‘like’ me. His protestations of interest had absolutely nothing to do with me. It was all about him. He was seeking approval and hoping that by intimating love, I might take note, invest in him and give him what he wanted (an unquenchable desire for attention). Without realising it he was screaming with insincerity and inauthenticity. I was left insulted and angry. He was left alone.

And it’s just the same for business. You simply cannot just decide to love your customer and then try to prove your love and expect results. Great relationships (romantic and economic) do not start with loving someone. They start with knowing someone.

Seek not to love your customer. Seek to know your customer.

It is only once you truly know your customer that a meaningful and profitable relationship can ensue. So how do you get to know your customer? As with most relationships there are a series of incremental steps that lead to love. And it starts with being open and listening… deeply.

Here’s five simple steps to knowing your customer:

Step One – Ask them about a their interests

It’s the first step to getting to know anyone. Take some time to learn a little about your customer: his/her likes and dislikes. What are his/her interests and tastes? Can you see some synergy between their interests and what you have to offer?

Step Two – Get to know them better

Once you’ve established some shared interests, get to know them better. What drives your customer? What thoughts and feelings drive their decisions? What’s important to them? Who's important to them? Why do they make the decisions they do?

Step Three – Listen to know them deeply

Learn to listen deeply. Seek to understand and listen without putting your view of the world in front of them too quickly.  As you listen - without judgment - seek to understand them beyond just what they say: look for the hidden, unsaid messages that can reveal their true selves. Deep observation can reveal needs, concerns and pain points that the customer themselves can’t always articulate. These unstated and unmet needs are what feed value creation. It is here that innovation is born.

Step Four – Nurture the relationship over time

Invest in value creation. If you really want to delight your customer, invite them to work with you in the spirit of co-creation. Together you might create something truly unique, that your competitors have never thought of and that many others will also appreciate. This is finally where we see love start to grow. Together you and your customer can create something that is truly valuable.

Step Six – Honour the relationship

No relationship will last unless it’s constantly valued and nurtured.  Once the commitment between you is established, keep close and connected. Stay present with your customer and continue to listen closely.  As time goes by do new needs or expectations arise? Has your customer grown and changed over time? But even the greatest of loves will die without constant and authentic nurturing. It is with constancy and consistency in listening and nurturing the relationship that a truly lasting relationship evolves. This is love.

So instead deciding you want to love your customer, decide instead that you want to know them, listen to them, nurture them. Change your mantra from “Love thy customer” to “Know thy customer” and watch as your relationship blossoms and evolves.

Steps to customer-centricity - customer empathy

Robynne Berg - Tuesday, December 01, 2015

 

 

Building customer centricity has become the most important strategic objective for any business planning for growth. It’s the ‘new black’ of corporate strategy. While most managers will agree that customer-centricity is important, few truly understand how to create it. That’s because managers often call on old strategic thinking and tools that just aren’t effective in creating customer value in today’s business environment.

At the end of the day, building customer centricity starts with creating a customer-centric mindset (I’ll cover this in a future post) and supporting that mindset with a process and suite of tools that will help you bring your ideas to life.

In my last post (the first step to building customer centricity), I spoke of the three key steps (and their associated tools) to building customer centricity:

  • Putting yourself in the shoes of the customer (customer personas)
  • Understanding how customers experience the world (customer empathy mapping)
  • Understanding their experience with your industry and/or business (customer experience and utility mapping).

The last blog talked about putting yourself in the shoes of your customer through a customer persona. Today we take a deeper look into your customers and how they experience the world using a tool much loved by design thinkers and innovators: the empathy map.

In the past you have no doubt developed sales targets segmented by specific customer demographics, and their ‘rational’ needs, wants and behaviours. The problem with traditional customer modelling is that it’s abstract and tries to fit customers into specific groups, often making the wrong assumptions about their wants and needs in the process. Market research is also abstract, rarely revealing the untapped motivations that can provide breakthrough insights.

Building customer empathy is about getting beyond the theoretical understanding of your customers and instead getting up close to them. You develop a more concrete understanding of customers from where you will find the clues to untapped needs, frustrations and opportunities. It is when you can get up close to a customer that you access the depth of insight required for new value creation and innovation.

The empathy map will help you get to the heart of the customer and reveal how he/she responds to the world around them.

 The Customer Empathy Map

With your customer persona/s in hand (see last week's blog) you now want to build a deeper understanding of your customer's internal world. You need to start at a point in time. I often suggest looking at the point they are about to engage with your industry.

The questions you should ask include: What are their key occupations and concerns when engaging with our industry? What are they thinking and feeling? Who are they listening to; their manager, the board, peers, friends? What is their emotional world like? What feelings does he/she not reveal publicly? What do they say and do: do they say one thing but do another? Why?

 The empathy map helps your team develop a richer understanding of what might be lying behind a customer’s decisions and behaviours. This process will uncover unexpected insights that could lead to creating better customer experiences or innovative products/services that customers love.

I recommend applying this tool to the first stages of planning for new growth or designing better customer service. It will reveal unexpected insights into your customer and their world that can transform the way you look at your customers and how you create value.

 That said, to really gain from this tool, I recommend you and your team go ‘into the field’ to really learn from the customer. I’ve found when you either bring customers into a ‘customer empathy’ session, or – even better – invest in an observational research program (such as ‘follow customers home’ research) your insights will be much richer and more meaningful because rather than working with assumptions your working with concrete feedback from real life.

 Whatever approach you choose, taking time to consider your customer using empathy mapping will help you build more customer-centric products, services and experiences.

 Download Customer Empathy Map Template

 Next week: Understanding customer experience and utility

The first step in creating customer-centricity

Robynne Berg - Friday, October 30, 2015

No doubt you already have a good understanding of your most important customers. You know their demographics and possibly their psychographics. You know how they tend to behave and what they need.  There’s a good chance you’re regularly asking customers what they want.  You create initiatives to support specific segments armed with all this information.

Yet even after doing ‘everything right’ a new product, service or customer experience initiative can fail to gain real traction with customers. Creating successful and profitable initiatives becomes even more challenging as you try to anticipate future services.

Challenging, as it may seem there are ways to better anticipate and respond to your customers’ current and future needs. It starts with learning to see the world through the eyes of your customer rather than through the lens of your business. So how do you do that?

The first thing to accept is that customers are dealing with a fast changing world – just as you are.  In the process they’re becoming increasingly demanding, influential and vocal. It is becoming increasingly more important for you to respond and adapt quickly to your customers and to create initiatives that address their future as well as their current needs. But how do you anticipate your customer needs before they are able to tell you?

Understanding your customers is not enough. You need to be able to extend your understanding to translating, exploring and challenging their needs. There are three fundamental steps to building a deeper understanding of your customers. The three steps (and their associated tools) are:

  • Customer personas (putting ourselves in the shoes of the customer)
  • Customer empathy map (understanding how they experience the world)
  • Customer experience and utility mapping (understanding their experience with our industry and/or business)

These steps can be used together in sequence as part of a planning process or used in isolation to help you flesh out, refine or test your ideas.

This post focuses on the first step – customer personas. I will introduce the other two steps over the next two weeks.

The Customer Persona

A customer personas helps us build a richer and deeper understanding of our customers, their current and future wants and needs. A persona is not a real person or an average customer.  A persona is a ‘fictional’ but realistic representative of a specific customer segment (or sub segment) that fits the specific characteristics of that segment (eg: demographics and psychographics).

A persona will help you facilitate a deeper discussion with the marketing, product development, customer service and/or leadership team than can be achieved by market segment and demographic information alone. The process will shift you away from abstract discussions around demographics and psychographics to a more concrete discussions around ‘real’ people. It allows the whole team to step into the customers shoes and collectively challenge assumptions about what a customer may need or how they may choose to engage with your business. You ask questions such as:

  • Where does he/she live, where does he/she work, how much does he/she earn?
  • What are his/her dreams and aspirations? What is his/her social environment like?
  • Who and what influences his/her choices and behaviours?
  • Why would he/she engage with your business/industry, and why might they not?

As you work through these questions your team crafts a story around the persona. You want to build a realistic persona that you can bring to life. Keep going until as a team, each one of you can speak to the persona as if you know that person. Once you've developed the first persona, start building other personas that represent other segments or sub-segments of your existing or desired customer market.

The number of hidden insights you uncover might surprise you. They will suddenly seem so obvious. Yet they are often overlooked as we go about trying to create new products, services and customer experiences because our attention is too closely connected to our business and not the customer.

This invaluable tool is the first step in creating customer centricity. Bring a customer persona tool into your next planning meeting and see how it transforms your conversation.  To help you facilitate that conversation, take a customer persona template with you.

Download Guide to Creating a Customer Persona

Download Customer Persona Template.

 

How to Manage Disruption

Robynne Berg - Wednesday, October 14, 2015

 

There’s something benumbing about industry disruption.  Many decision makers are witnessing disruptive new entrants in their competitive space and they know it spells trouble. Yet the tendency for many companies facing industry disruption is to do one of two things (can you see yourself in either of these scenarios?):

  1. Ignore the disruption: hoping that it’s a fad or that it’ll take years to really impact on the business (by which time you’ll have a response strategy). This is inertia bias: the attractiveness of doing nothing even in the face of certain destruction.
  2. Try to compete with the disruptor: emulating their model and hoping you can take back some of their market share (or at least hold on to your best customers).

Neither course of action will help you manage disruption. At best it may delay the inevitable (but even that is doubtful). It is almost impossible to go up against a disruptive new entrant and compete (even acquisition of your competitor is no guarantee).

So how do you effectively defend market share and achieve growth in the shadow of disruption?

Firstly it’s important that you look deeply into the disruptor and its model to fully understand the unique value and utility they bring to the market.  You don’t want to look just to a disruptor’s extrinsic value (which is where most competitor analysis stops). You want to understand their intrinsic value. What is about their value proposition that engages customers?  What shifts in customer expectations, needs or attitudes does the new model respond to?

When you can fully appreciate the value customers gain from the disruptor’s offer you can then look to create new and differentiated value rather than trying to compete against an agile and powerful competitor.

A great example of this approach  comes from the hotel industry, which is responding to Airbnb’s disruptive model.  I have seen three very different responses from hotel groups. Look to each of these responses and ask yourself which best describes your company’s response to disruption:

Deny

Some hotel groups have chosen to view Airbnb as nothing other than a new channel to market. I’ve overheard hotel executives stating the model is a fad and that regulators will eventually step in to put a dent in its growth. Given Airbnb has 1.5M listings in 190 countries and is expected to achieve triple figure growth this year (pundits project 80M room nights) we should expect regulators to bend to the marketplace not the other way around. Ignoring Airbnb is a deleterious strategy.    

Emulate

Other hotel groups have looked at the Airbnb model, understood it as a disruptive ‘channel’ and decided to enter into the game. We see a number of hotel groups investing in sites such as onefinestay, lovehomeswap and airbnb itself in order to try and get some skin in the game.  To my mind they’re missing the point. They are looking to the share economy model on the basis of its business model (how it goes to market) rather than its value (why customers participate).  

Create

One of the most exciting responses to Airbnb’s disruption has been from serial innovators Atyzen Group. They created CitizenM: the low cost luxury hotel (a great case study in itself).  Their new venture is a hospitality concept for ‘digital nomads’: Artyzen Habitat. Habitat disrupts the hotel and airbnb model by offering a unique communal living space where travellers (including a growing market of working nomads) are able to connect to the community during their stay and have access to co-working and social spaces. Habitat staff play the role of host (rather than hotel employee), offering a non-obtrusive and personal service. 

Artyzen Group has understood the value intrinsic in the Airbnb model. It’s not about the channel to market; it’s about creating community for travellers. They have looked at airbnb’s disruptive model only in terms of gaining essential new insights. And then they have created their own disruptive innovation. While yet to launch, Artyzen Habitat is creating enormous interest and is certain to have every chance of success.  I myself can’t wait to book a stay at an Artyzen Habitat hotel.

How will you manage disruption?

So what does this story tell us? What is the lesson for incumbents as they witness impending disruption? Firstly – don’t ignore it. Responding to disruption through innovative strategy may have risk, but it’s not nearly as risky as the status quo (where eventual failure is certain).

Secondly, look beyond the disruptor’s business model: it’s only part of the story. Instead seek to understand the unique value that the disruptor offers to customers. What new value does it offer?

Finally allow these insights to inform you only as far as they allow you to reimagine how new and unique value can be offered to your market (or emerging markets). Look beyond your assumptions and traditional market boundaries to find your own unique offer to the market place: your own disruptive innovation. To manage disruption, become a disruptor.

To learn more about Artyzen Habitat - watch the clip below.

Innovation from Another Perspective

Robynne Berg - Wednesday, October 07, 2015

 

In the once seedy underpass of Flinders Street Station in Melbourne there is an art space called The Dirty Dozen: referring to the 12 glass display cases flanking the walkway. The current exhibition is called Prevaricated Frequencies - constructed by a group of engineers and scientists called Skunk Control.

The display cases are transformed into subterranean forests of translucent variegated light that metamorphoses into differing hues as you watch or move around the case.

The lads behind Skunk Control are using these shifts in light to represent the “transient interpretations to questions we ask ourselves about our lives in order to inform and shape them."

The same is true for the process of innovation and growth in an organisation. Innovation is about allowing ourselves to interpret the same data through a different lens. When we shift away from our habitual lens and apply a new perspective such as a customer or the future we can interpret our business in a very different way.  It is through applying a different perspective to our business that we will find new insights and discover breakthrough ideas.  It is a shift in perspective that will transform our businesses.

This exhibition will close soon. Dirty Dozen is in Campbell Arcade - enter underpass from Degraves Street Melbourne

Why Innovation Tools Can't Think

Robynne Berg - Wednesday, September 30, 2015

 

A colleague recently came to me with a perplexing problem. He had just completed an innovation workshop with a global financial services firm in Europe. They contacted him to say the sessions were deemed very successful. They were keen to continue with the engagement if he could help them with one small request: could he please make the innovation planning tools simpler.

After a brief discussion about whether we could assist with a simpler tool we came to a realisation. The innovation strategy tools engaged for the workshops were simple. Very simple. The problem was not the tools. The problem was the thinking and discussions that take place in planning groups when applying the tools. 

The client wasn’t asking for a simpler tool: he was asking for tool that meant he and his team didn’t have to think!

Unfortunately planning tools do not think for themselves. Innovation planning tools are designed specifically to facilitate different conversations that lead to new insights and new ideas. These conversations – especially in the early stages – can feel messy and ambiguous. That’s the idea. The innovation process requires messy ambiguity and a bit of personal and team squirming. Persist and you uncover the ah-huh insights and breakthrough ideas. Persist often enough and you will build an innovative mindset, skills and culture.

Innovation is primarily the result of different thinking. It requires that you not only think but also think differently. The one great tool that can think for you is your brain. Unfortunately innovation planning tools are not effective otherwise.

Innovation planning tools are fantastic in helping you and your team innovate: just don’t expect them to think for you.

The Rise and Rise of the Marketer

Robynne Berg - Tuesday, September 09, 2014

 

This is a rallying cry to marketing managers: “It’s time for you to step up”.  The business world is changing faster than at any time in history. Over the next decade companies will need to make significant strategic and cultural transformations as they respond to digital disruption, globalisation and continuing market shifts.

We will witness a strategic shift towards customer centric organisations: organisations who put the customer at the heart of strategy, product development and operations.  And this shift to a customer-centric organisation will facilitate the meteoric rise of the marketer.  Marketers could become a very influential member of the executive. Provided of course that marketers are prepared to step up.

But to be a key player at the executive and boardroom table marketers will need to shift their focus and develop new competencies in strategy, innovation and leadership.

The Shift to Customer-centred Strategy

The digital revolution is still in its infancy. As many companies grapple with these early impacts of digital and social media they are being forced to transform every aspect of their business.

Today’s customers have more choice, influence and power than at any time in business history. The balance of power as flipped convincingly into the hands of the customer. Today customers have very high expectations around service and delivery. They expect everything in real time.

Big data and analytics have enabled marketers to build an unprecedented understanding of customers and their behaviours.  Social media has facilitated intimate and collaborative relationships with our customers – often in real time. As a result, strategic focus is fast shifting from the traditional competitor-centred strategy to customer-centred strategy. 

To achieve profitable growth many companies will seek to transition to a customer-focussed strategy where efforts and resources are directed to the creation of unprecedented customer value and new untapped demand. Customer centricity will lie at the heart of product development, ICT, operations and frontline activities. It will force an alignment between strategy and operations.

Who is going to drive these new customer-centric organisations? Logically it should be marketers. Marketers’ proximity to and understanding of customers, their needs and behaviours and their expertise in loyalty and customer service means they are perfectly positioned to drive the strategic agenda and influence operations, ICT and frontline activities.

Marketers Must Build Their Influence

The actual impact and influence of the marketer in a customer-centric business environment is hard to overstate.  Yet many mid to senior level marketers do not yet possess the competencies required for them to step up to this position of influence.

While marketers are well represented in the C-Suite most do not have the executive power and influence of CFOs or COO.  Few CEOs have a marketing background and few marketers sit on boards.

This is partly because the executive still views the marketing department as the implementers rather than drivers of strategic intent, growth and operations. And for good reason.  While senior marketers are often respected for their strategic acumen within their function, their contribution to the broader strategic conversation is too narrow. It is time for them to broaden the scope of their knowledge and influence.

In order to position themselves as the strategic drivers of their organisation marketers must broaden their strategic viewpoint and develop competency in three key areas: strategy, innovation and leadership.

Developing Strategic Competency

If marketers are to become the key drivers of strategy they need to broaden their strategic perspective and view their business through a different strategic lens.

A customer centric organisation positions the customer at the centre of strategy, operations and culture. Customer centricity has touch-points across the entire supply and value chain. It will drive product development. It will influence ICT, production, processes and organisational values. It will shape recruitment decisions and organisational development.

Marketers will need to broaden their strategic perspective across all these fundamental functions within the business.

Becoming Innovative

As businesses are required to become more innovative, adaptive and customer-centric, marketers in turn must develop new competencies and practices. To achieve growth in today’s business environment managers must build an innovative mindset and bring innovation tools and processes into their practice.

An innovative mindset is developed by looking beyond our assumptions and constantly challenging the status quo.  It’s about looking beyond the established market boundaries to create new customer value and drive new demand. Marketers who look beyond market boundaries will discover the breakthrough ideas and innovative business models that lead to unprecedented customer value, new demand and competitor-free market space.

To achieve this, marketers need to bring innovative thinking practices, innovation tools, processes and values into the organisation. Marketers should also facilitate a collaborative environment that unites customers with the organisation to co-create products, services, communications and processes.

Leading Across The Organisation

For marketers to help drive a customer centric organisation and align strategy and operations they need to build greater influence across the organisation.

Marketers can apply their skills in communications, collaboration and behaviour change to help the organisation align strategy and operations and develop customer centric products and processes. Further to existing skills they must build their profession acumen across other functions of the business and broaden their strategic conversations.

While often visible and appreciated for their strategic perspective, marketers are often viewed a subject matter experts with limited understanding of the broader business issues such as supply chain, finance and operations.

Marketers need to look beyond the marketing function to develop a strategic and operational perspective across other functions of the business. They need develop their financial literacy and their working understanding of the supply chain. They need to speak the languages of finance, ICT, HR, operations and importantly the board.

With a broader perspective of the organisation and an ability to communicate in the language of its many functions, marketers will be in a position of authority and influence.  They will effectively position themselves as the rightful drivers of customer centred strategy.

The Role of Educators and Associations

There has been no other time in business history where marketers have had to chance to raise their visibility and influence across the executive.  The extent to which marketers succeed will be largely up to the individuals and other bodies that support professional development of marketers.

Tertiary institutions have an important role to play in structuring post-graduate marketing degrees and ensuring marketers develop broader business knowledge, particularly in finance and operations.  When I completed my Masters of Marketing Degree I did not undertake a single financial unit, because no financial units were offered as part of the degree.  This is unacceptable. Universities must ensure that post graduate degrees offer a range of core and elective units in financial management, operational management and leadership.

Similarly it’s incumbent on professional associations to support their members with a professional development program that builds more than the marketers’ technical skills in marketing.  They must help develop the full professional so as marketers have the knowledge and support to raise the influence of marketing in their organisations and across industry generally.

It Comes Back to You

However, the fundamental responsibility for raising the influence of marketers rests with the marketers themselves.  If you’re a marketer with aspirations to build your influence and hold an executive role it is imperative that you steer your career and your professional development towards a holistic understanding of business.

It’s imperative that you build deeper working relationships with the CFO and COO in your organisation. Its important that you learn to speak the language of the various functions in the business rather than depending solely on the language of marketing.

If you are currently in a mid or senior level marketing role, the challenge has been laid before you.  This is the moment when you can transition your career and lead from the front of your organisation.  This is the time when you can build a highly influential role within the executive.  Are you going to step up?

(photo by Håkan Dahlström)

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