Chief Customer Officer is key in the customer economy

For decades, traditional business models have relied on a rigid corporate structure, with a CEO overseeing the heads of siloed departments, each working independently on their own area of the business. According to Daniel Bausor, the founder of marketing consultancy Famous4 Customer Advocacy, this model’s usefulness has now run out: “It is unfit for purpose in todays’ digital age.”

We no longer live in a product economy, in which the customer is powerless, and profit is king. Instead businesses find themselves operating in a customer economy where customers have more power than ever, exercising influence as online reviewers, advocates and critics. In this new economic reality, businesses need to rethink how they treat their customers at every stage of their journey. This change has to start by re-evaluating the structure of their organisation and put the customer at its heart from culture through to co-creating products and services with them.

Some businesses, like Amazon or flourishing tech start-up Zoom, have put the customer first from the very beginning, their organisational structure designed to prioritise their users and ensure that the customer journey is as smooth as possible. For them, the customer’s experience is already at the forefront of decisions and processes, making adapting to the customer economy a far easier transition. Most organisations however have not grown with this outlook, meaning that neither business leaders nor the workforce are best placed to shift the business focus. For this reason, employing a Chief Customer Officer (CCO) is an invaluable first step in reorienting the direction of the business.

Nish Kotak, co-author of the influential ‘Chief Customer Officer Report’ and Managing Director of executive search firm Talecco defines a CCO as, “an executive who is ultimately accountable for both strategy and customer initiatives across the business. It’s not just about customer obsession; it’s about a balance with financial rigour and operational excellence.” This definition highlights the nuanced role of the CCO, implementing policies which emphasise customer focus in every area of the business, while maintaining the existing priorities and goals of the organisation.

Customer focus from the top

It is important to note that the CCO is not a replacement for the CEO – businesses still require leadership. As noted by Kotak, the CCO balances customer focus with operational efficiency. This can only be achieved by working closely with the CEO to help focus the business on the customer, secure in the knowledge that new policies will be supported by senior staff. Together the CCO and CEO must establish a customer vision and rigorously promote it at all times; having employees onboard with a customer-centric approach is the best way to ensure that this new culture will take root.

Also, the CCO is important for making sure the business’ understanding of the customer environment is kept up to date. They keep abreast of new customer-related technology, such as augmented reality and virtual reality, ensuring it is being used where appropriate. The CCO monitors customer expectations so that policies and processes are always up to standard to meet their needs.

Once a CCO has been brought onto the team and changes have begun to take place on a senior level, further additions to the workforce can broaden the scope of an organisation’s customer focus. Customer Experience Managers (CEM) and Customer Success Managers (CSM) have clearly defined roles within the Customer function. Whilst CEMs are cross-functional which help customers on a more individual level, the CSM role is focussed on customer service and retention.

Overlaying this, the CCO oversees how the business as a whole relates to the customer with CEMs and CSMs having the primary responsibility for the overall customer relationship, championing the customer at every turn. Between CCOs, CEMs and CSMs, customers are prioritised at every level of the organisation, from corporate policy to everyday interactions with the public.

“The rise of the customer economy is revolutionary, and adapting to it requires significant transformation. Together with the CEO, the CCO must establish a customer vision.”
_{– Daniel Bausor}

Breaking down siloes

The introduction of customer-led thinking should allow for the breakdown of departmental siloes, which is key for success. Siloed departments have long been common in businesses and were useful when the object of an organisation was to make and distribute a product or service. In the customer economy, this isolationist approach needs to be overhauled. All departments are responsible for customer experience and satisfaction, not just sales and marketing or customer services.

The policies introduced by the CCO will encourage all staff to have this customer-led outlook, while other members of the customer team will drive positive interactions with customers directly at every stage of their journey. Staff should be encouraged to consider the customer journey, prioritising this over their department’s formal responsibilities.

These changes may seem revolutionary, introducing new senior figures, implementing business-wide policies and encouraging staff to go beyond their departmental boundaries. However, the rise of the customer economy is also revolutionary, and adapting to it requires significant transformation. By reassessing corporate structure, and introducing new roles where previously customer focus has been lacking, businesses can not only survive in the customer economy, but thrive.

Daniel Bausor helps clients develops strategic customer advocacy programmes and with the transition to a customer economy. He is also co-author of the book ‘The Customer Catalyst – driving sustainable business growth in the Customer Economy (penned together with Chris Adlard).