Coronavirus (COVID-19), Learning & Development

Your Actions Lead Your People to Customer Obsession

Slowly emerging from the pandemic, many leaders of teams and organizations are relieved to have survived the dark uncertainty of the last year. They should rightly pat themselves on the back if they maintained their teams’ confidence; our surveys in six countries show that in general, about half of workers had confidence in their direct managers’ handling of the crisis. But leading people through the pandemic doesn’t guarantee that managers have led them to anywhere.

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That’s the challenge of the rest of 2021 and for the rest of the decade. A year from now, if your people are asked where you led them coming out of the pandemic and their answer is “Back to the way things were,” that means you failed the test of this decade. The destination your staff should be focused on is not a return to a prior way, a previous goal, or an earlier pattern. Instead, your organization should be squarely focused on one thing: customers, who are themselves constantly changing.

Customer Obsession

At Forrester, we call this state “customer obsession” because for it to actually shape the way your organization sets its vision, decides on its strategy, and determines how to operate, it must be more all-encompassing than mere customer focus. Just 15% of companies qualify as customer-obsessed, meaning their vision, strategy, and operations are all optimized to deliver customer-obsessed outcomes without the need for personal heroics or special exceptions to policy. Such companies reap disproportionate benefits—their employee engagement scores are higher; customer satisfaction scores are as much as 50% higher; and, resting on those twin pillars, they experience higher revenue growth than competitors in the same industries.

But you don’t just get there by believing it’s worth it. Somebody has to lead the organization to customer obsession. This includes the entire organization, by the way, not just the people who touch the customer in physical locations or in customer support roles. Because of this, leaders at every level and in every role are responsible to lead their teams to customer obsession. We surveyed 1,239 full- and part-time workers across every sector of the U.S. economy in late 2020 to find out whether they felt their leaders were leading them to customer obsession.

The good news is that 32% of workers believe their leadership takes responsibility for customer outcomes, invests in developing employees to be better able to create value for customers, and provides the resources necessary to be customer-obsessed. As we would expect, those workers report significantly higher satisfaction and productivity at work, with 90% of them reporting they are “proud to work where [they] do”—more than 1.5x the average rate.

Action is the best way forward

How does a customer-obsessed leader stand out from other leaders? In the end, saying pretty words about the customer will only get you so far—and, in our experience, can inspire cynicism if the pretty words aren’t matched with actions. In fact, 60% of a leader’s ability to improve customer outcomes at his or her organization comes down to actions, not inspirational words or charismatic style. And the actions required are not over the top. For example, employees are more likely to score their leaders high on customer obsession when they see that leaders use data to develop a strong understanding of what customers want. It’s simple enough in theory. But how often do you ask for data to help you make decisions, how much do you review the data with your teams, and how much do you show that your recommendations were shaped by the data instead of your gut instinct or your experience?

Remove employee roadblocks

Another example: Leaders are more likely to be described as customer-obsessed if they are seen as actively removing roadblocks to employees doing their jobs to serve customers. Unblocking can mean making connections across silos, working to resolve policy problems that inhibit customer obsession, or applying personal effort to help an employee who’s stuck between organizational boundaries. This is related to a third type of leadership behavior that scores high for customer obsession: providing additional resources to solve problems for or create new value for customers. A CIO at a large North American retail bank confessed to us that she hides hundreds of thousands of dollars in a budget category so when her team comes up with unexpected ideas outside of traditional budget cycles, she can ask, “What could you do with $50,000 to make headway on that customer issue?” The energy her leadership provides always translates into positive outcomes, as well as a more engaged employee and team.

Customer obsession matters

Customer obsession matters but not without actions demonstrating to employees that leaders are personally committed to customer-obsessed outcomes. Once leadership demonstrates this, employees will naturally follow, but they will follow even quicker if you measure and reward their successes—not their heroic efforts but the way they improve the organization’s everyday innovation capacity to effortlessly deliver increased customer value. This requires rewarding the generation of ideas, collaboration between teams, and the quick development and testing of new solutions. Even if those things don’t pan out or prove to be successful, a customer-obsessed leader knows that rewarding those behaviors builds a kind of muscle the organization will be able to flex as a matter of routine in the future.

This post was written by Forrester Vice President and Principal Analyst James McQuivey, PhD. Read more from him here.