It is common to find that teams do not analyse their internal customers/stakeholders, which can lead to a confusion in purpose and focus. Cross-functional ‘mobile’ leaders should encourage and lead this activity which can break down barriers and disrupt silo-based thinking.
A key to success for life science in the coming decade
Part 5 – Who is your customer?
Key takeaways in this article:
• Stakeholder mapping – especially Internal stakeholders, is often done poorly and can help break down silos.
• Project centric leadership can actively break down barriers.
• Assessing Internal customer satisfaction can help give teams directions for Improvement.
The immediate answer to the question “Who is your customer?” may seem obvious on first pass but it is not always as simple as it seems.
In recent years, much emphasis has been placed on sustained success in business being driven by a focus on your clients’ needs in order to stay ahead of your competitors. As a consequence, many organisations have undertaken a customer focus journey- meaning they have been shifting towards a world of real time responsiveness to customer needs that is embedded across their whole organisation in terms of values and behaviours (HBR, 2005 The Quest for Customer Focus).
For the pharmaceutical industry, this has resulted in multiple activities that put the patient at the centre – patients on advisory boards and reviewing clinical trial protocol designs, digital initiatives for gathering patient data, patient forums and patient-centric websites, the list goes on. Of course, to take all this knowledge or feedback and realise the benefit and value for patients, there must be consideration given to an organisation’s internal operations too- in other words, a focus on your internal customers, as well as your external customers.
Organisational design is predominated by function-based hierarchies, where teams are formed based on expertise or activity type. These different functions usually come together to deliver projects, offering their own specialist knowledge and experience to successfully drive forwards on these initiatives. However, with budgets aligned to functional delivery and performance management often based on relevant functional knowledge and expertise, it is easy to see how tensions exits between being function-centric and project-centric. In the worst case, functions dominate, and silos can form, resulting in project team decisions being over-turned post-meeting, priorities and resources being misaligned and data sharing / knowledge exchange becoming restricted. In such silos, the focus is often “inward” which creates a focus on the internal customers within the function i.e. often vertical customer relationships.
Conducting a stakeholder mapping exercise is a useful way for functions to consider who are the most relevant or important internal customers beyond the obvious vertical interactions (those involved in process improvement may also be familiar with the SIPOC analysis -Supplier, Input, Process, Output, Customer). Building such 360-degree internal customer awareness, combined with assessing stakeholder interests, influence and level of engagement through these mechanisms is clearly important and can help with breaking down any silos. Sadly, this is something that in our experience is often poorly utilised in many organisations. In addition, this alone does not create the internal customer focused culture that is needed to accelerate or increase efficiency of delivery to your external customers.
With a strong awareness of their internal customers, “mobile leaders” can bring a “project-centric” approach to delivery and a more inclusive or “outward” thinking style based on a curiosity-driven mindset (HBR, 2019 Cross-Silo Leadership). They will be leading by example; actively breaking down barriers; and creating the right environment for collaborative knowledge sharing and joint problem solving to realise collaborative advantage, whether we think of that in the context managing internal or external relationships (HBR 1994 Collaborative Advantage: The art of alliances).
In addition, it is beneficial to consider how best to engage people in such a customer-centric philosophy by looking at how success can be measured and providing incentives to achieving relevant performance targets. In the context of external customers this can often be distilled down to the bottom-line measures of the company, such as sales or share price. There are also many different approaches to specifically assessing and measuring customer satisfaction that have been adopted over the years. Of particular note, in the early 2000’s the stock price for Charles Schwab (a financial services firm) crashed and yet just four years later, they had regained industry leadership by creating a customer-centric culture through the use of the Net Promoter System® (HBR 2003, The Number You Need to Grow). Subsequently, the NPS tool has been utilized by many other industries to measure external customer satisfaction and loyalty, because of its simplicity. A single question is posed “How likely is it that you would recommend our service to family, friends or colleagues?” with a score range of 0 to 10, where 0 is extremely unlikely and 10 is extremely likely. Only those scoring 9 or 10 are considered promoters, whilst those scoring 0-6 are detractors. Statistics drawn from Satmetrix indicate that the highest growth companies tend to have NPS scores of >50%, whereas those performing at an average level are often barely in the positive scores. Negative scores are not unprecedented!
Whilst NPS is well represented for assessing external customer satisfaction, we have also supported organisations in adopting NPS as a tool to assess internal customer satisfaction. By targeting the NPS question to relevant internal customers, specific information can be gained about how your internal customers perceive what you are doing. The metrics obtained provide something tangible to everyone involved and allow aspirational targets to be set. In fact, the true benefit of NPS comes from how the tool is applied.
Without information, it is all too easy to make assumptions about what your customers really care about and why they scored the way they did. Furthermore, without any visible action, how do you change the perception of your customers and manage any damage that may do to your reputation? Therefore, the true benefit is realised when emphasis is placed upon the follow up of the feedback obtained and engaging customers in discussion of how what you did / delivered can be improved for them.
Even this simple act can change the perception of a dissatisfied customer. However, engaging with your customers this way and tracking improvement in the NPS data can begin to generate a desire to build interactions across functions, open the door to dialogue and joint problem solving, thereby breaking down silos and creating increased project-centricity.
Implementation of tools and techniques such as these, can help create both an external and internal customer-centric focus, increasing the level of collaboration, creating self-sustaining, learning-oriented and adaptive teams that work effectively together to deliver competitive advantage for the organisation as a whole.
Written by Chris Williams