Customer Leadership. Getting better results in the Big Data era. Customers are in charge

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1 Customer Leadership Getting better results in the Big Data era Customers are in charge Customer interactions are all moving from push to pull. Instead of businesses pushing services and products at Customers, the individual can now discriminate and pull services to them to suit their exact needs, preferences and timing. Individuals can view recommendations from other Customers, access products, services, resources and media that they need, and optimize how and when it is all delivered and subsequently used. In other words, Customers increasingly personalise everything rather than accept mass branding and marketing. Technology, Big Data and Social Media are fuelling this personalisation. Transparency is driven both ways allowing Customers to both better understand what they are buying and also communicate, positively and negatively, with (and about Brands) and companies in real time. On top of this, there is another revolution. The world is increasingly moving to an exchange of personal data for services. Consider loyalty programs. These work when the Customer is prepared to let a business or Brand have information about them, in return for the benefit the Customer wants (e.g. money off, free flights etc.). But in a world with ever expanding data sources, and personal interaction with our digital environment, no one business (or even Government) can LeaderValues Ltd 1

2 get all of the data about the Customer. Only the individual is able to fully access all of his or her own data, often storing it via their mobile devices and the Cloud. The Customer is the data owner - and in charge. Companies must come to terms with this power shift and develop strategies and plans accordingly. Big Data and what it means It is estimated that only 18% of data that businesses have is effectively utilised. There is so much talk about Big Data, yet little practical advice to help organizations deal with it. The fact is, though, that whilst Big Data technology is ever evolving and increasingly sophisticated, it s becoming quite manageable from a technical perspective. But fully using it to drive better decisions is another matter. Few enterprises of any size know how to effectively take advantage of Big Data for their Customers. The core issue is knowing how to turn insights into action, and embed effective processes to allow every employee inside the business to take action. And few senior leaders have the knowledge and skills about data and analytics at a strategic level to properly lead the change needed inside their enterprise. Too many firms simply start with the data that exists, and then try to take advantage of it. The real power of Big Data comes from starting not with the data, but with the strategic question that needs answering: What problem are we trying to solve or what opportunity do we want to grasp and how can data driven insight and processes help? Then, it is necessary to define all of the data and the technology needed to deliver the required result. Often, to get real competitive advantage, this means taking the data the firm has and then blending new data sources with it. The mantra should be right data + deep analysis + clear insight = measurable action. In our experience, even when Big Data is embraced, the major source of failure is that the insights derived from the data are not fully actioned because the leadership is lacking, and the appropriate organization structures and change processes are not properly embedded. LeaderValues Ltd 2

3 Tiny Data + Unstructured Data = Big Data We should stop calling it Big - it s just Data. And it comes in various forms. Structured Data is data from a single source in a structured format, which, whilst it may be measured in terabytes, it is actually fixed in its complexity - rather like a huge spreadsheet. Often datasets like this are considered Big simply because of volume, variety and the velocity with which they are formed. An example would be Tesco s use of Clubcard Customer loyalty data dating from the 1990 s. Today s technology can usually cope fairly easily with the pure bigness of structured data. Unstructured Data is data with no fixed database format or pre-determined structure. Think of messages and posts on social networks, Twitter, images uploaded to the web, Facebook likes, Customer service calls etc. This is far more difficult to analyse and act upon - and challenging to match individual Customer records with structured databases. Open Data is data made freely available by data owners or generators, to allow third parties to use and combine with their own data. For example, the UK government is a leader in this, making data such as census, weather, transportation, health and economic trends all freely available. In my opinion, True Big Data combines all of these. Technologies are now readily available to combine and make sense of multiple sources and turn analytics into useful insight, clear visualisations and action plans. Consider the example of looking at someone s Facebook timeline, and noting that they tend to like wearing blue but never orange. If you are a clothing manufacturer, and knew that fact, wouldn t that help you make more appropriate offers to that potential Customer? The key is to be able to identify the same Customer across these disparate data sets, and then access and combine the data - all, of course, with permission, Strategic Response There are two broad strategies that business must embrace to respond to this major shift in consumer behaviour, and take advantage of these new technologies. These are Customer Centricity and Innovation Networks. 1. Customer Centricity is about putting the Customer squarely at the centre of all a business does. This aims to better meet Customer needs, and use data-driven LeaderValues Ltd 3

4 Mick Yates 2015 insights to build effective Customer programs and offers. This probably also means changing the employee s mind-set about how best to engage with Customers, and embracing data-driven decisions rather than just relying on experience. The business should also create a common Customer language and action plans across the entire enterprise, to ensure that everyone is working with the same paradigm The goal is to provide each Customer with a personalized experience, using data-driven insights to build seamless engagement across all touch points with the business. 2. Innovation Networks are then the organizational paradigm that allows business to take maximum advantage of Big Data and associated technologies, to speed up the flow of new ideas, products and services. In this data-rich and tech heavy environment, ideas can come from anywhere suppliers, Customers, universities and even government. Just focusing on internal ideas is not enough. There is a need to embrace new technologies, use vast data sets and open up operational processes to speed up innovation sensing and execution. Business must proactively build networks of internal and external resources, with dynamic structures that change the way the organisation innovates. Customer Leadership is the action plan Pulling these themes together, we have created the Customer Leadership model. All enterprise activities are built round the Customer, using datadriven insight, and connecting branding and organizational processes into an integrated whole. Programs based on this approach can both develop leadership and change management skills, and drive data-driven Customer strategies. Our LeaderValues Ltd 4

5 programs are based on a deep and uniquely connected understanding of leadership development, Brand marketing, retail and the use of Big Data insight. Brands Brands historically have decided their strategy, and then marketed themselves to Customers. Today, increasingly Brands try to personalise their efforts to the Customer, rather than use old-fashioned push marketing. Big Data helps this. Yet Customers also now openly use technology (and especially social media) to engage with and comment on Brands. In many ways, the Brand s image is no longer just defined by the manufacturer - it is defined by Customers themselves. We thus use a Brand paradigm as the best way to conceptualise a modern, datarich business. By Brand, we mean the totality of what the Customer base, products, services, image, and communication is. These are all subject to Customer scrutiny in today s social environment, and a Brand s image is constantly changing, reflecting this scrutiny. Thus, we also define companies as Brands. A step-wise Leadership approach To co-create this Customer Leadership framework with Clients, we use a simple step-wise development process of Envision, Enable, Empower and Energize. First, Envision. The start point is a clear, Customer centric articulation of the business model, strategy and organizational paradigm. Don t just start with How can we use the data we already have. This data will be used - but first ask the strategic questions properly. Second, Enable. Assess the current technology and data operations, with a view to making them robust and fit for the business purpose. Be sure to ask the question What are we trying to do, and what data do we need to achieve the result. Then, decide what technology and organisation structure will support this. A key consideration is whether performance can be improved by using current data in different ways, or whether completely new data sources and insight are needed. It is also critical to evaluate how the data is analysed and actioned, and what decision processes are impacted and must be changed. Third, Empower the organization to act. The plan will turn insights into action and, importantly, the right organizational decision processes must be embedded and rewarded. Finally, Energize. Leaders must walk the talk on the Customer, consistently using data to drive decisions, and then break down organisational and process barriers that get in the way. LeaderValues Ltd 5

6 Mick Yates is an experienced Global Exec and Leadership strategist. He has a deep and uniquely connected understanding of leadership development, global Brand marketing, retail and the application of Big Data analytics and insight. Mick works with Boards, the Executive Suite and the Investment community He has over 30 years Leadership and Business Development experience, with Regional CEO responsibilities in major, Customer-focused global enterprises (Procter & Gamble, Johnson & Johnson), as well as a strong background in leadership and change management. Mick has 10 years practical experience in the Big Data space (dunnhumby), using analytics to drive growth and business change across the world. He builds on this successful track record as senior Exec & Board Director in global firms, consultancy, start-up & non-profit, with a talented group of associate firms and experts who provide expertise as needed in analytics, Brand strategy, communications, retail, Branding, digital design and social media marketing. Mick has chaired an IPO and been Board Trustee in non-profit (Save the Children). He is founder of LeaderValues, one of the web s most visited leadership sites, and is Visiting Professor at the University of Leeds, working on Big Data, Ethics and Leadership, at the Consumer Data Research Centre. Mick has lived on 3 continents and worked across 6 in both developed and emerging markets. His passions? Respect for Customers, data-driven decisions, clear strategic choices, developing great people, & creating high performing teams. contact Mick at mick@yatesweb.com or +44 (0) LeaderValues Ltd 6

7 Client examples Customers & Big Data Global Consumer Products firms, advising on consumer driven insight and action plan development Strategy development and follow-up for new, digital start-ups Board level / CEO consulting and action planning with several global Customer data insights companies Due-diligence, acquisition advice and post-investment Customer strategy development on behalf of global Private Equity Firms Telecoms services provider Direct to consumer Brand marketing Brand Marketing & Customer Strategy Advising on adapting long-standing Brand marketing services to the digital/ social world Helping a leading global mobile phone manufacturer to establish an effective matrix management structure across the world, for the marketing department Leadership & Organization Change Tailor-made Leadership development and Board Governance programs for senior management teams in one of the world s leading NGOs LeaderValues Ltd 7