Ask people who the most important person in a company is and a large majority will tell you it’s the CEO.
But ask CEOs from the world’s leading companies and many will give you a different answer – it’s the customer, of course!
How customers think about your brand – or more accurately, how they feel about it – is now recognised as the greatest predictor of future business growth.
Modern CEO’s: A new way of thinking
Mark Leiter, Chairman of Leiter & Company, a strategy, consulting and investment firm, argues that the primary focus of last century’s corporate leaders was ensuring high quality products. The reason being that quality was the main way in which customers differentiated between brands.
Since then, technological advances have seen issues with product quality virtually disappear among market leaders in most industries. Today’s customers typically distinguish between brands by reference to how they feel about them.
This has led to a shift in thinking among corporate leaders. Today’s leading CEO’s recognise that delivering positive experiences to customers each time they interact with a brand must be an absolute priority.
A well known early adopter of this new thinking was Amazon’s Jeff Bezos. Legend has it that from the company’s early days, he would place an empty chair at the table at every board meeting. It was intended to represent the customer, reminding those who were present exactly who should be at the forefront of their decision making.
While this shift in thinking may come easily to a certain new breed of CEO, for others, it requires some effort.
CEOs of the old school did not typically see customer service as part of their job. They saw their role as more like the captain of a ship. Once a destination was decided on and a strategy for getting there devised, they would monitor progress while navigating the inevitable storms encountered along the way. The other key aspect of their role was overseeing the performance of various management teams. It was these teams that were considered responsible for the day to day running of the business.
It’s now understood that this kind of ‘siloing’ gets in the way of developing a company culture that puts customers first. Like all cultural change, this needs to come from the top. That, of course, requires buy-in from the CEO.
The need for CEO involvement in corporate cultural change
Most CEOs are aware that change is in the air.
A recent study by Forbes found that 97% of CEOs see customer satisfaction as key to business success. 90% believe customers have the biggest impact on their business, while 93% nominate ‘improving customer experience’ among their top priorities.
Unfortunately, good intentions will only get you so far. Although research shows that companies where the CEO is directly involved in customer experience initiatives enjoy higher revenue growth, only 56% of CEOs are getting personally involved.
This means that nearly half of today’s CEOs are yet to adapt to the new paradigm. When the benefits are so well known, why would this be?
Beyond the simple fact that people are generally resistant to change, many CEOs owe their success to excellent analytical skills and strategic judgement. These attributes served them well when businesses primarily competed on the quality of their offerings – something inherently quantifiable. They are less useful in a world where companies compete to develop an emotional connection between their brand and their customers.
Whatever the case, despite nearly all CEOs recognising the need to develop a customer centric culture, too many are failing to get personally involved in the process. For genuine cultural change to occur, the CEO must be involved. For those leaders to whom this does not come naturally, it’s a matter of evolving, or rapidly becoming a relic of another time.