Posted on May 26, 2013 by

Know your customer

The expression the customer is king is more relevant today than it has ever been. Nearly every organisation is trying to entice customers to use their products or services but at the same time, deliver a high level of customer service to its existing customers.

The challenge organisations face is that customers are now demanding much more due to globalisation and new technologies but still expecting the same level of customer service.

To meet these demands organisations are focusing on new innovative approaches to provide customers exciting new products and services but how do we know these meet the needs of the customer?

How can we be sure we are targeting the right customers and importantly how can we be sure we are not impacting our existing customers i.e. changes we make to our services.

To answer these questions we have to first answer a more fundamental question which is what is a customer?

Customer 

A customer can be best described as the recipient of a goodserviceproduct, or idea, obtained from a sellervendor, or supplier for a monetary or other valuable consideration (Wikipedia).

We can see from the definition there is a clear relationship between the organisation and the customer, but there seems to be something missing.

What is the experience of the customer when interacting with the organisation and are the emotional aspects considered when providing or changing the service?

To understand these aspects we have to change our way of thinking and look outside the organisation and start to look at the experience from the customer’s perspective.

Service Design

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The design field provides us the emotional aspects of the customer which are sometimes missing.  The service design field in particular aligns the motivations of the customer with the service and its delivery.

This alignment ensures the service which is provided, is user friendly, competitive and is relevant to the customer. The backbone of the process is to understand the behavior of the customers, their needs and motivations.

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This type of design enables organisations to differentiate themselves from their competitors, but at the same time delivering a single customer experience.

The customer experience has emerged as the single most important aspect in achieving success for companies across all industries (Peppers and Rogers 2005). For example, Starbucks spent less than $10MM on advertising from 1987 to 1998 yet added over 2,000 new stores to accommodate growing sales. Starbucks’ popularity is based on the experience that drove its customers to highly recommend their store to friends and family.

What is even more surprising is the core product offering (coffee) which Starbucks provides has not changed but yet the service and the experience is forever evolving.

The value of understanding the service and the customer is very clear but what about architecture? How do we ensure the information we capture about the service and the customer is consistent?

Defining Content

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One of the aspects of architecture which is useful is the ability to group things into common classifications or taxonomies; this ensures content is consistent and can be integrated.

An example classification which aligns with our customer is a customer segmentation model.

Customer Segmentation classifies customers into distinct groups.  This separation of customers into unique groups is often based on multi dimensional customer information such as; purchasing patterns, industry, product usage and lifestyle characteristics.

Properly developed segmentation insights inform a strategic roadmap intended to take advantage of key profit driving opportunities within unique customer group.

A common classification provides a few benefits:

  • Improves reporting and analysis by grouping information together
  • Information becomes easier to navigate due to groupings
  • Collaborative working is made easier, as like items are grouped together throughout the organisation
  • Increases reuse as items created previously are easily found
  • Unifying language at a certain level

Integrating content

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Another advantage of having groups of common things is that this “stock room” of content can be used to link information together. This linking starts to provide the integrated business delivery view we are striving for.

Examples of integrated content would be:

  • Contractual agreements linked to products
  • Business services which are bundled into products
  • Business capabilities which deliver the various business services

Joining the dots

What is clear is that architecture and design offers great advantages to an organisation but the real value is when you align them into a single discipline.

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Bringing together the emotional aspects of the customer with the logical business delivery provides a single view of the customer.

This single view enables us to understand how the customer needs align to our strategy but also helps drive the product development process.

Integration of content starts to show not only how the service is delivered but we can also group together segments from the logical and emotional worlds into a single customer segment. This ensures when grouping customers we consider the experience aspects alongside the more traditional characteristics i.e. industry or purchase patterns.

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A full customer picture sharpens the focus on which customers we should be targeting, but also what business aspects are needed to not only deliver the product/service but also meet the customer experience.

The so what moment

Putting ourselves in the shoes of the customer but then aligning to the business offers huge advantages to organisations.

So what are these benefits and what will it give us:

  • Multi lens – Able to view the organisation and the customer from all perspectives due to an integrated view.
  • Regulatory aspects – Regulatory constraints in relation to the customer and the products/services we provide are more understood.
  • Focused marketing – Organisations are able to target the right customers due to an holistic view of the customer.
  • Business delivery alignment – Aligning the architecture to the experience ensures the business model is designed around the customer.
  • Architecture rigour to design – The architecture discipline provides rigour around content and ensures designers can still be creative but using standard terms.
  • Pull rather than push – Organisations move away from pushing incorrect services to customers.  Through research and prototyping we are able to attract customers to the organisation due to an understanding of  the customer needs and desires.
  • Drive product strategies – Products are designed around customer groups and their needs with alignment to the capabilities of the organisation.
  • Revenue – Profits are increased due to more focused strategies.
  • Understand impact of change – When making changes to the organisation the customer experiences and the service delivery are also considered and understood.
  • Create new opportunities – An integrated view will identify gaps in either your service or the market which could result in the creation of disruptive products/services.

As we strive to become more adaptive and responsive to change there is a greater need to be able to bring all the various moving parts together.

The bringing together of the design and architecture disciplines will ensue we achieve this adaptability but also meet and understand the needs of our customer, continue to be innovative and also continue to grow and manage our organisations; which is something we all strive for.

Image credits: Cube Image, Milan Guenther / Intersection, published 2012 by Morgan Kaufmann