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  • What is Outside Innovation?
    It’s when customers lead the design of your business processes, products, services, and business models. It’s when customers roll up their sleeves to co-design their products and your business. It’s when customers attract other customers to build a vital customer-centric ecosystem around your products and services. The good news is that customer-led innovation is one of the most predictably successful innovation processes. The bad news is that many managers and executives don’t yet believe in it. Today, that’s their loss. Ultimately, it may be their downfall.

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      Observations

      • LEAD USERS
        Eric von Hippel coined the term "lead users" to describe a group of both customers and non-customers who are passionate about getting certain things accomplished. They may not know or care about the products or services you offer. But they do care about their project or need. Lead users have already explored innovative ways to get things done. They're usually willing to share their approaches with others.
      • LEAD CUSTOMERS
        I use the term "lead customers" to describe the small percentage of your current customers who are truly innovative. These may not be your most vocal customers, your most profitable customers, or your largest customers. But they are the customers who care deeply about the way in which your products or services could help them achieve something they care about.
      • LEAD CUSTOMERS AND LEAD USERS
        We’ve spent the last 25 years identifying, interviewing, selecting, and grouping customers together to participate in our Customer Scenario® Mapping sessions. Over the years, we’ve learned how to identify the people who will contribute the most to a customer co-design session. These are the same kinds of people you should be recruiting when you set out to harness customer-led innovation.
      • HOW DO YOU WIN IN INNOVATION?
        You no longer win by having the smartest engineers and scientists; you win by having the smartest customers!
      • CUSTOMER CO-DESIGN
        In more than 25 years of business strategy consulting, we’ve found that customer co-design is a woefully under-used capability.
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      July 26, 2006

      WRESTLING ORGANIZATIONAL INERTIA TO THE GROUND

      No matter how brilliant you are, and no matter how well-intentioned your executives are, it's extremely difficult to shift the culture of an organization to become truly customer-adaptive.

      There are people issues. People don't like change. It takes time to change behaviors. People need to be seduced into doing things differently, not coerced or commanded.

      There are organizational issues. The way we divide up functional responsibilities organizationally makes sense from the standpoint of centers of excellence; we group people together based on what they're good at doing: sales, marketing, finance, operations, IT, etc. But when customers try to get things done across our silos, our organizational specialization adds friction.

      There are performance management issues. We all do what we're asked to do and what we're rewarded for doing. It's very hard to put good customer-centric metrics in place that really make sense for people in each department.

      There are focus/priority issues. We SAY that delivering a great customer experience is important. We understand intellectually that increasing customer loyalty is important. But we also have new products to get out the door, numbers to meet, projects to complete, and competitors to beat.

      Shifting your organizational culture takes time. It's going to take five years. It's hard work. Many customer-centric executives have been wrestling with the molasses of organizational inertia for longer than that.

      GREAT BOOK TO READ TO SPEED YOUR JOURNEY

      This Spring, a client told me that his wife was writing a book I would appreciate. Of course, I was gracious and interested, but when I received the book and began thumbing through it, I loved it! Jeanne Bliss is the author. Her book is called “Chief Customer Officer.” I recommend it highly. Jeanne provides a clear strategy and a set of tactics for shifting your organizational culture so that your firm can actually deliver the wonderful end-to-end customer experience you envision. This book should be required reading for all executives and managers, not just the people who lead the customer charge in their organizations or who aspire to do so. Jeanne is a seasoned veteran. She began her customer journey working directly with Gary Comer at Lands' End and moved on to Allstate, Coldwell Banker, Microsoft, and Mazda. She has learned by doing. A weekend spent reading this book will probably save you two years of frustration. My book review/summary is attached.

      This is a book about what it takes to shift your organizational culture to be more customer-centric. It’s a must read for any customer-centric executive; not just for Chief Customer Officers or for those who aspire to that position. The hardest aspect of customer experience work--making it easy for customers to do business with you and designing and delivering a differentiated end-to-end customer experience that will grow your base of profitable, loyal customers--is shifting your organizational culture. Every business unit and department has its own focus and its own metrics. These goals and metrics often conflict with one another when you try to design and deliver a wonderful experience across silos. This book, Chief Customer Officer, is an accurate and useful guide that will help anyone--whether you sit at the top or the bottom of your company--understand how to move your organization through the steps required to shift your company’s culture to deliver a great customer experience.

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