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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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      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.
      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.
      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.
      You no longer win by having the smartest engineers and scientists; you win by having the smartest customers!
      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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    August 02, 2011


    Vikas Nehru, VP, Product Marketing, KANA

    Why Social, Listening, and Customer Experience Initiatives Belong in Customer Service

    The new voice of the customer is putting a huge burden on the old ear of business. With the advent of social media, telling 10 friends can now mean influencing 10 million friends. The resulting tidal shift in the business-to-customer relationship has businesses scrambling to adjust: B2C companies are now employing new listening technologies, appointing Chief Experience Officers, and forming social media response teams.

    As listening programs are developed, or social media teams are formed, I believe it's time to reconsider which department should be leading the charge. Who do you want advocating for customers based on voice-of-the-customer and Customer Experience insights or engaging on social media? Marketing -- the automatic fallback -- is not the best option. (Recently, Patricia Seybold agreed in her blog "Why Customer Experience Shouldn't Report to Marketing".)

    Customer Service, on the other hand, is the right choice. Why? Because customer service has the actual connection to the customer, a departmental incentive, and the operational structure to effectively listen to the voice-of-the-customer, engage via social media, and take the insights all the way from big picture talk to implementation and measurable results.

    Listening is in the DNA of Customer service.

    Customer service is in the business of listening -- it's in their DNA. That's what they do -- day in and day out. The customer experience that your business is trying to capture through its listening program is actually unfolding when customers call in to the contact center or chat with agents. Service reps linking what customers are saying or requesting directly with what the business has to offer. It's voice-of-the-customer theory in practice.

    Bottom line, it makes sense to extend the social listening programs to Customer service as well since they can relate to your customers -- pretty important when it comes to customer advocacy.

    To Listen and Act has a direct impact on Customer Service metrics.

    Customer Service people care. To find gratification in solving other people's problems all day long, you'd have to. But, to be fair, it's their job to care -- customer satisfaction is a key metric for service managers.

    If customers are requesting better online self-service options, it's in the service department's interest to listen and ensure organizational follow-through.

    And that's precisely why the service department is the natural launching point for listening and customer experience initiatives -- Customer Service has a vested interest in keeping customers happy and solving issues.

    Customer Service also has a compelling budgetary incentive on its own behalf to act on listening insights -- like communicating actionable product features to R&D or shipping bottlenecks to the appropriate department. The service manager knows that a better product and better processes will mean fewer calls to the contact center and fewer departmental resources tapped.

    Customer service has the right operational structure.

    Unlike Marketing, Customer Service has all the operational service processes and metrics in place needed to scale and cost-effectively engage in social media. A bug in a product release, for instance, or change in the buying process, may impact customer service with a ten-fold increase in the number of online mentions and calls to the contact center. With hundreds of thousands, or millions of customers, this increase matters. Customer Service, not Marketing, has the right operational structure to rise to the occasion -- to deal with volumes, scale effectively, keep costs down, and follow governance/compliance rules.

    Is your Marketing department tweeting about lost baggage?

    Customer Experience, engaging on social media or listening may have had a faulty landing in your Marketing department. However, it's time to view social engagement with customers about their problems for what it is: an extension of customer service. Teams monitoring Twitter and Facebook for customer issues are dealing with the same problems agents in the contact center face. The overall company philosophy and policies that guide agents handling complaints via phone, email, or chat should be no different from those social media teams employ.

    In the Marketing department, social listening tends to be limited to reputation management -- monitoring the social conversation for negative fallout, and responding in kind. We've all seen the PR crises unfold as disgruntled customers tweet their way to better service, getting some of the biggest brands out there to dance -- if fleetingly -- to their tune. Crisis management has its place, of course, but that just begs the question: Whom do you really want handling upset or angry customers? More importantly, why wait for a crisis to motivate change or finally fix problems with the services you provide?

    There's a bigger picture yet.

    The bigger picture -- and better practice -- is to incorporate social listening and engagement or customer experience programs into your overall customer service operations and service strategy. By incorporating feedback from all your customer communication and hence listening channels into Customer Service business processes, you're no longer just providing a reactive service response. You're in the proactive position of building a better business aligned with customer needs and wants.

    Customer Service is the obvious favorite for dealing with customers, but it's also a natural hub for process and organizational improvement driven by customer listening and customer experience insights.

    With Customer Service now less reactive because of all this listening, it means that they can have a true place at the Executive table. Customer service can measure the impact of changes to the customer experience, to help the budget better around product and business change. No longer just a cost center they can, in fact, become the hub of the business and, if aligned with the rest of the departments, can be instrumental in driving change.

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