Culture

The innermost circle ‘culture’ includes strategy, brand and people. It is the core of CEM and describe the willingness, what kind of CE the company want to produce. Culture is a combination of vision, mutual aspiration, strategical decisions and shared idealism. As a connecting and a success factor of culture is effective communication through organiza-tion. Actual performance is completely originated from culture, which company tries to reflect in its performance. The core of CEM and its subsections are presented in the figure 8.

Figure 8. The core of CEM

STRATEGY AND LEADERSHIP

The most of Finnish companies still act the way, that the customers are for the company.

In oration and visions customer centricity is highlighted, but it does not show in concrete actions (Löytänä and Kortesuo 2011). The first step for bringing vision about CE to reality is forming a CEM strategy.

The strategy is the starting point of the whole CEM process. It is one of the most important prerequisite for successful CEM and requires commitment. The CEM strategy should be

a part of company’s overall business strategy. It could be described as a company’s ex-ecutives’ real intent and willingness to produce CE (Gerdt and Korkiakoski 2016). Stud-ies (e.g. Shirute Oy 2016) show that the biggest obstacle to develop CE is a lack of clear and coherent strategy. Which is a result of intersecting views about the importance of CE and its profitability among the board of executives. If change is not urgent and necessary, concentration to CE is easily ignored on broad-based actions. CEM requires a shared as-piration for strategic decisions and execution (Boyaysky et al. 2016). If central themes are unable to identify and communicate through the whole organization, development stays only as an agenda of one person, team or individual sector. Of course, developing single sectors or actions is important, but it doesn’t create a permanent competitive ad-vantage (Gerdt and Korkiakoski 2016). The responsible manager and team of CE is only a performing force of mutually formed and acknowledged CEM strategy (Boyaysky et al.

2016). Otherwise, impacts stay low, not significant level.

When board shares the idea of CE as an competitive advantage, it should also share mu-tual idea of the current state of CE. For that, it is necessary to perform an analysis of the current state. The analysis can be a part of strategical planning or first thing to do, when it is moved from strategic decisions towards actual planning. The analysis recognizes strategical potential and advances planning the strategy. Although its true essence is giv-ing a base to brgiv-ing strategy to actions. Relation over time depends about boards’ consen-sus and understanding. Either way, the strategy and the current state analysis together are excellent base to build a development plan for CEM. (Gerdt and Korkiakoski 2016, pp.

31-33)

The analysis of current state includes three sections to consider: inner abilities, possibili-ties of business sector and customers. Inner abilipossibili-ties are evaluated to find executives and personnel’s willingness, abilities and acquirements to CE centric business model. Also, organization structure’s suitability and management model are reviewed. The goal is to find how well customers are understood through organization and how tools and methods support it. That leads to second section, customers. It is necessary to understand custom-ers’ experiences right now and their needs in the future. Building CE orientated company can not be originated from inner predicts. Last section ’possibilities of business sector’ is important, but usually overrated and wrongly focused. Instead of concentrating rivals’

actions, should focus on operated environment wider. How it is developing and recognize potential trends. The company needs to recognize the potential of CE in its business sec-tor. All companies should transfer to more customer centric a one way or an another, but possibilities to gain CE as an competitive advantage should be consider carefully. A very CE competed business sector does not offer easy wins anymore. The role of follower is hard. Every company needs to reflect its actions and business sectors competition with CE to find the suitable level for its objectives. (Gerdt and Korkiakoski 2016, pp. 24-38).

When executives share the mutual aspiration and willingness based on strategy and anal-ysis of current state, it is needed to communicate through the organization. Executives

need to set a top-down aspiration and overarching mission to ensure that everyone have the same level of ambition and the same guiding principles. (Duncan et al. 2016) This phase indicates immediately the level of mutual understanding among executives. If im-portance of CE is underrated by some of executives, it appears immediately in organiza-tion attitudes to adopting new cultural mindset. Discordant messages cause uncertainty at operational level and objectives stay blurred among the personnel. (Gerdt and Korkiakok-ski 2016)

Often, organizations create conditions for change but fail to meet their aspiration or reach the overall goals of the transformation (Duncan et al. 2016). The whole organization need to understand the main objectives and actions. There must be clear financial objectives, so that it is understood where transformation is heading and what it tries to change; which are the profits wanted to raise and which secured; which expanses are eliminated and which reduced. These objectives must be assigned to functions (Gerdt and Korkkiakoski 2016).

The most important thing to understand is strategy’s capability for improvement. It is a launching point of whole process, but it does not mean for being a solid and one-timed by its nature. It can be evolved constantly to correspond better to gained understanding and changed situation. To survive in competition of creating experiences, company needs to respond changes constantly and improve its performance.

BRAND

Brand is a positive reputation around the company or a product. It consists images, which are company’s promises to customers. Many people think that a brand is a logo, a website and a color chart (Grant 2016). But no, today among business leaders is prevalent: ”Our customer experience is our brand” (eConsultancy 2015). This is a consequence of the widespread distribution of social media and digitalization. The old-fashioned brand think-ing has come to the end of the road. Brand and CE are strictly connected and their im-portance have swapped (Gerdt and Korkiakoski 2016).

Companies are not able to control their brand so strictly anymore. Customers make deci-sion to buy based on three elements: earlier experiences and beliefs, other people opinions and marketing (Gerdt and Korkiakoski 2016). Earlier, companies sold and customers formed their image mainly based on marketing and salesmen promises. The process was strictly in the hands of seller. Nowadays, process has turned from selling to buying. It is not possible to build up brand by traditional marketing, like advertising. Social media and digitalization have made companies performance transparent. Customers form their im-age of products and companies individually based on distinctive sources (Löytänä and Kortesuo 2011). Own and other peoples’ earlier experiences are reflected directly to brand. Brand must be earned, not bought or build (Gerdt and Korkiakoski 2016).

Branding must be seen from a fresh view. Brand is a created way to face customers. Brand is a set of presuppositions that company have to redeem in interactions with customers.

CEM strategy is based on brand strategy and vice versa, so they need to be synchronized together. CEM strategy works in both sides of brand strategy by modifying it and bringing brand’s promises to concrete actions (Gerdt and Korkiakoski 2016). This relation is sim-plified in the figure 9. As Meyer and Schwager (2007) wrote, CE reflects the gap between customer’s expectations and their experiences. Overrated brand fails constantly to exceed or even meet expectations. That causes one-time customerships and disappointments.

Branding should lead to loyalty and recommending. Customers may engage with the brand because of marketing, but if they are wanted to keep hooked, there must be some brand experiences that exceed their expectations (Grant 2016). If company is not able to redeem promises in interactions, brand strategy need to be fixed. Otherwise, brand will fix itself via customer’s experiences. When company is producing disappointments con-stantly, brand’s value will collapse. So, aligned brand strategy is a requirement for ex-ceeding experiences (Gerdt and Korkiakoski 2016).

Figure 9. Relation of brand and CEM strategy (Modified Gerdt and Korkiakoski 2016) Brand should shape culture to deliver CE and culture should bring brand to life (Grant 2016).

PEOPLE

Vineet Nayar summed up the potential and challenge of CE in his wide attention-treated book “Employees first, Customer second” (Löytänä and Korkiakoski 2014). Employees are in the central role to deliver a great customer experience. CE begins from employees who know about it, care about it, and are well positioned to deliver it. Delivering great CE requires an engaging employee experience (Boyaysky et al. 2016). Engagement means that employees feel connected to the company promises and share its values. Tem-kin Group (2016) report find a correlation between employee engagement and success in CE. It showed that CE leading companies had 1.5 times engaged employees than CE laggards.

A great CE is based on employee’s real willingness to serve. Willingness among person-nel need to be ignited and enabled by executives. This culture does not come by itself, it needs to be created. The key is to recruit the right talents and educate personnel. (Löytänä and Kortesuo 2014) Among the person’s competence for the task his/hers fit to the brand needs to be considered as well. It is said by Smith consultancy (2013): “Find the people

who share your values and then teach them the skills they need; not the other way around.”

From the view of CE, another important talent for personnel is ability to face the people.

People need to be emphatic, good to handle relationships, passionate and solution oriented (Löytänä and Kortesuo 2014). It is something, what can not be taught. Also, attention of recruiting people to customer interface should be raised. They are communicating daily company’s values and practices to customers. Their abilities and attitude form CE pri-marily. Still usually their recruiting is neglected and most of the focus is only in recruiting top and middle management. (Gerdt and Korkiakoski 2016)

When company has the right people, their mindset need to orientate by training. Training should base strongly to values and attitudes. Aiming to create a culture of service and highlight the personnel goal to produce CE in all actions. This should be done by gaining understanding of right and expected behaviors. So that values are employed to part of the personnel daily basis. (Gerdt and Korkiakoski 2016)

One of the most important things to create CE are interactions between employees and customers. These ‘moments of truths’ are getting rarer because of digitalized and autom-atized channels, so the meaning of one raises even more. That’s why people who interact in those important moments, need to have all the support to act and produce exceeding experiences (Löytänä and Kortesuo 2014). Company need to offer that supporting envi-ronment for personnel. Otherwise, people and their mindset are useless. Unnecessary hi-erarchy need to be removed from the top-down management. Organizational transparency through whole management chain is everything. The chain need to work from top to down and especially from down to top. Focus need to be in the customer interface. There is the best knowledge of customers’ needs and desires. It is important to encourage to try new innovative ways to operate with customers. Best practices are usually lifted from the ob-servations of single interactions. (Gerdt and Korkiakoski 2016)

Authorization is the key factor to offer exceeding experiences. People in customer inter-face have the understanding, the ability and possibility to affect experiences, but no au-thorization. Typically customer interface has very limited means to influence in rapid exceptional situations. Personnel need to be authorized and trusted for making individual decisions. Organization culture, training and decision processes need to be strong enough to offer ability for it (Gerdt and Korkiakoski 2016). For example, Zappos has gain success by trusting their customer service representatives. They are authorized to do exceptional practices, so that company can deliver experiences, which it is dedicated to. (Löytänä and Kortesuo 2014)

There is one more obstacle to distract personnel focus to produce CE. Previously was used to reward about selling. This does not encourage to sustain old customers. The whole idea of CE is about loyal customers and achieving reputation through successful custom-erships. Indisputably the focus of this reward system is completely wrong (Gerdt and Korkiakoski 2016). In worst case, it prevents to serve the best possible way. Rewards

must be linked to advance CE. Rewardment can be official or unofficial. Official reward-ments, like bonuses, can be attached to metrics, which indicate how well team or em-ployee has advanced CE. Unofficial rewardments, like challenge cup, are more easily put into service and influences can be very effective. (Löytänä and Kortesuo 2014)

Every company need to form its culture to produce CE from its own perspective. The whole potential of CE is based on personnel desire to understand and serve customer the best possible way, according to company’s culture. (Löytänä and Kortesuo 2014)

FORMATION OF CULTURE

These three subsections define the core of CEM. Culture is the inner willingness of CE wanted to bring alive in company’s interactions with customers. In focal point is commu-nication. It connects subsections and merge the culture. By effective communication, cul-ture is transparent and unite. It is clear for customers, employees and board what kind of experiences company want to create and how it is done.

The company is consortium of people, who together create CE. They are the culture and its embodiment. Organization values need to be originated from its people. To create gen-uine experiences, the culture and the people must be truly customer centric and connected to customers emotionally. Individuals must be able to act naturally, so they must share the same idealism than the organization has. If all three, decision (strategy), promises to customers (brand) and actual performance (people) are not in line, customers feel dis-tracted and experience creating is not logical and natural. In some point, dynamics fixes itself, so that CE is line with organizations’ true culture. Luckily, none of these are single-time actions. All sections can and must be developed constantly. These sections evolve each other’s, people defines strategy, strategy forms brand and brand guides recruiting.