• September 1, 2011
  • By Donna Fluss, president, DMG Consulting

Hire, and Empower, a Chief Customer Officer

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What is the chief customer officer in charge of? If your CCO can answer that question, he has a fighting chance of succeeding in his position. If your CCO can’t answer, it’s time to update his resume.
The concept of a CCO is a great one. But the challenge is that most companies already have departments and managers in place charged with ensuring that customers are satisfied. The relevant parties include the following:

• Marketing: responsible for understanding and meeting customer needs and wants.
• Sales: responsible for selling customers what they are willing to buy.
• Customer service/technical support: responsible for addressing customer inquiries and problems.
• Product development: responsible for building new products that customers want.
• Market research: responsible for identifying customer needs and wants.
• CEO: responsible for creating an organization centered on customers and responsive to their needs.

At a minimum, a chief customer officer is responsible for getting all of those siloed customer-oriented departments to put aside their political interests and put the customer first. Enterprises have undertaken many initiatives designed to make customers a priority—including investing millions of dollars in customer relationship management, customer experience management, voice of the customer, Six Sigma, and quality assurance—only to be left disappointed by the results. Why? Executives and managers are rewarded for meeting goals, and the groups mentioned above do not share common goals.

Let’s put aside the cynicism from years of watching the inner workings of typical enterprises and concede that the concept of a chief customer officer is sound. At a high level, this person can be a major change agent but only if he is empowered with the following responsibilities:

• manage all customer-facing activities, requiring all customer-facing groups and functions to report either directly or indirectly to this person;
• influence goals and compensation for managers of all customer-facing departments;
• make changes to products, processes, policies, and systems, and reallocate resources as needed, to improve the customer experience;
• access systems and, if required, create new ones that provide information on customer behavior, profitability, and satisfaction; and
• access relevant and timely data about competitors.

If a CCO is going to be taken seriously, she must report either to the CEO or COO and be adept at getting people with conflicting agendas to work together. But that is the easy part. The hard part is making customers the focal point. In enterprises that are truly customer-centric, every employee is empowered to be a customer advocate. All policies and processes must prioritize customer needs over all else except for profitability. Those companies that succeed have a clear mission of putting customers first and rewarding employees and executives for doing whatever it takes to keep customer satisfaction and retention high.

DMG applauds organizations that are committed to customers’ needs by creating the position of CCO. But such a strategy is commendable only if the CCO is empowered to provide an outstanding customer experience. On the other hand, if the company’s objective is to  put a good face on business as usual, it will be detrimental to the organization, customers, and the CCO.

Therefore, enterprises should build a customer-centric culture and reward all employees who show they are customer advocates. Naturally, any organizational structure should include checks and balances to ensure that all employees are doing the right things for customers. All customer-facing departments must share a set of goals and objectives. If having a CCO moves the organization in that direction, the role will benefit the corporation and reward the individual. But just giving someone the title without making the necessary cultural and organizational changes is a formula for failure, as has been proven many times in the recent past.

Donna Fluss (donna.fluss@dmgconsult.com) is founder and president of DMG Consulting, a leading provider of contact center and analytics research, market analysis, and consulting.

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