The Chief Customer Officer
In a recent post to the Net Promoter LinkedIn Community, the question was asked about whether companies today should have a chief customer officer. There was a time when I would have said absolutely yes, but my thinking has since evolved.
The customer and customer experience are owned by many functions across the business. The challenge with being the Chief Customer Officer (CCO) is, you don’t OWN the customer or the customer experience. In most cases, the CCO becomes a “coordinator” or governance body that drives actions across functions, regions, or business units. This person may have the attention of the CEO and carry a hammer to get organizations to cooperate, but they don’t often carry the operational responsibility to deliver customer experience improvements. Worse yet, they have the potential of being the complaints department, listening to the customer with an empathetic ear and trying to resolve issues.
I would rather see EVERYONE be the CCO, with strong leadership from the executive team and the CEO for driving improvements that increase loyalty. The executive team should be accountable for taking action and delivering results. If you want to assign an executive to drive this, consider expanding the responsibilities to include the customer experience and give this executive the resources they need to not only measure and monitor the experience but actually make the business improvements necessary to improve.
The key to success is to integrate the voice of the customer into every area of the business, hold your leadership team accountable for results, and evaluate your performance alongside your operational metrics. If your organization needs a CCO to accomplish this, then go for it. The only caution flag I would raise is that leaders in non-operational roles will have limited impact on driving improvements. Evaluate your own organization to determine the best way to integrate customer-centric behavior, and then decide whether you need a CCO.
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Marcelo Toyama on July 26th, 2010 at 11:50 am:
Mrs. Eastman,
I didn’t participate in the discussion regarding the roles of a CCO before, but how would it differ from a position from a Supply Chain Officer? In my humble opinion, both roles superpose in a few areas described in your post (mostly when relating to areas across the company, driving changes and actions to improve the overall customer experience).
Regards,
Deborah,
I have to agree with you that not every organization needs a Chief Customer Officer.
In a study I conducted of more than 50 CCOs, I discovered three reasons why companies hire a CCO:
1.) Address chronic customer crises
2.) Create sustainable competitive advantage
3.) Protect and retain existing customers
In all cases, the CCO is the catalyst for change towards customer-centric culture.
Not all CCOs are as hamstrung as you describe. The CCO that devolves into the empathetic complaint department deserves to be demoted or fired, because they are not truly driving strategy at all levels of the company and therefore do not deserve the title of Chief Customer Officer.
Based on my research, I’ve created the CCO Continuum (http://ccocouncil.org/site/classifying-chief-customer-officers.aspx) that categorizes CCOs by their focus on customer acquisition vs. retention, and degree of line authority vs. process authority. It is interesting to note that many small company CCOs begin in the bottom right quadrant, focused on acquiring new customers and owning all customer-facing personnel in a dual role (ie. VP of Sales & CCO). As the company grows, they begin to change their focus to retention, found in the bottom-right quadrant. Mid-size companies often cannot afford a pure staff function, and the CCOs continue in the dual-role. As company revenues cross the ~$1B mark, the dual role fails to scale: very few can handle that sort of operational and customer responsibility. Thus, companies adopt a staff function CCO that focuses on improving customer-facing processes and customer-centric culture.
To return to your original question, does every company need a CCO? If the CCO is a catalyst for change, and your company has the customer firmly embedded in your DNA, then no, you have no need for a catalyst. However, if you aren’t at all like Disney, Apple, or Nordstrom’s, then you need a CCO to help drive profitable customer behavior and create customer-centric culture–and help hold everyone accountable for progress towards these goals.
Curtis N. Bingham
Founder & Executive Director, Chief Customer Officer Council
http://ccocouncil.org
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Nikhil Datar on July 27th, 2010 at 9:36 am:
Dear Deborah.
The thought that crossed my mind when I posted this question on the Net Promoter Linkedin Community was to explore if principles of how business manages and controls other corporate assets and resources can be applied to customers with the same level of rigour.
Here are two simple examples,
CFO – While it is every person’s responsibility to manage MONEY efficiently in the business, there is a CFO to whom everyone is accountable for submitting a detailed account of how and why they are spending the money or making sure that the receivables are well controlled. A CFO does not have direct operational responsibility for a healthy P&L but integrates the company’s money.
HR Head – Every line manager and unit head have the accountability of making sure that operational processes and employee happiness happens, but they are all accountable to the HR Head to collate and makes sure policies are adhered to.
I like your observation that everyone must be a CCO. I would assume that you mean it in a tone similar to the examples above. Yet, we dont see anyone in organizations whose job is it to make sure that each participant (marketing, sales and service and others) are doing their bit to make sure that providing customers a memorable experience is at the heart of what they do. Who is controlling the customer interest as almost a moral Balance Sheet?