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IT Innovation | March 10, 2015

Avoiding the Customer Advocacy Trap

By: Stephanie Spada

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We’ve heard “The customer is always right” a million times
over. In the complexity of today’s business environment, it’s just not always true
− especially in the B2B world.

Make no mistake: we have to listen carefully and continually
to what our customers are saying. The danger arises when, in the name of
customer advocacy, we act on customer requests and address only symptoms − instead
of digging deeper to understand underlying challenges and how the requests fit
with the fundamentals of our own business. Doing whatever the customer asks of
us is not a business model; bounds us to reactive, tactical responses;

limits
innovative ideas; and doesn’t truly serve the customer well.

In short, declaring yourself to be a customer advocate
suggests that you will basically do whatever your customers ask. This approach
ultimately results in tactics that probably don’t mesh with strategy.

Instead of customer advocacy, we propose that customer success
should be the new mantra. To us, customer success means implementing a
closed-loop process where corporate strategy drives customer engagement that thoughtfully
supports the customer’s desired business outcomes, which in turn drives customer
feedback, which then allows us to adjust our strategy.

At Oracle, we have spent the last 10 years on transforming
our business into a customer success-focused enterprise with an emphasis on:

  • Expanding customer feedback and engagement
  • Developing a deep understanding of our
    customers’ business
  • Making it easier to do business with us
  • Executing an R&D strategy rooted in customer
    needs
  • Enhancing employee engagement with our customers
  • Building on customer successes with loyalty

Listening to our customers is fundamental to our focus on customer
success at Oracle. We leverage myriad ways to gain a holistic view of the
customer’s experience and perspective. This includes relationship surveys tied
to three-year account strategies; continuous and ad hoc customer advisory
panels; transactional surveys for point-in-time feedback across lines of
business; executive advisory boards and focus groups; input from account teams
and executive sponsors; social media harnessing unstructured and topical input;
as well as user experience labs where customers help to define next-generation
solutions.

By analyzing this input with a particular eye toward what we
need to do to assure customer success, we can identify root causes and trends
that enable us to make changes and drive innovation to have the greatest
possible impact on our customer base. Our Top Ten Program is designed to
address company-wide and cross-line-of-business initiatives that have the
largest impact to our customers as well as our business. We derive the
programs’ list from feedback collected across multiple sources, as well as
emerging trends highlighted by our most strategic customers. Key steps include
identifying customer priorities, conducting business impact analysis, implementing
corrective action, monitoring feedback channels, and communicating results and
actions back to the company and customers.

By limiting their focus to customer advocacy, enterprises
curtail their potential for innovation. I’m reminded of the development of the
Wii gaming system. Genyo Takeda spearheaded the team at Nintendo. Instead of
simply looking to improve incrementally on gaming consoles by addressing specific
customer demands for faster systems with more sophisticated graphics, Takeda
and his team re-imagined the concept of a gaming system from the ground up,
including how users interact with it. The team looked beyond what gamers said
they wanted, digging deeper into how users interacted with games and what was
holding back adoption in some segments. This way of looking at the problem put the
customer’s experience at the center and examined what the customer really
needed rather than what they simply said they wanted.

An organization driven by a deeper understanding of the
customer and long-term customer success, rather than more superficial customer advocacy,
demands that enterprises stay (at least) one step ahead of their customers −
applying market expertise and insight, analyzing customer input to identify
issues and root causes, and thinking creatively to proactively identify needs, in
some instances, even before the customer recognizes them.

This is very much the approach that we take at Oracle. Incorporating
customer feedback within the framework of our business strategy is critical in
helping us to define new product direction and understand emerging needs – with
a goal of getting ahead of the curve. Our Engineered Systems are a case in
point. These innovative solutions – which include our Oracle Exadata, Oracle
Exalogic and Oracle Exalytics solutions − combine hardware and software that
are engineered and optimized to work together out of the box. They deliver
extreme performance and install rapidly to accelerate return on investment, reduce
IT complexity and cut total cost of ownership. This concept was entirely new
and many customers looked askance until we convincingly demonstrated the
benefits. Today, demand for these systems is strong, and we have developed a large,
committed, engaged and enthusiastic user community.

A strategy that puts a focus on customer success, allows
this type of innovation. A customer success view, with customer feedback placed
in the proper context and a deep understanding of what customers really need enables
nuanced strategy, which has collaboration and innovation at its core.

We are successful if and only if our customers are
successful.

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