What does satisfying customer or member needs (and I use these terms interchangeably) really mean? Is it designing programs or services that your organization believes are relevant? Discounting fees for the unemployed?
This top-down, provider–to-customer product design conjures up for me images of amateur target practice. You aim in the general direction of the target but which of its concentric circles you will hit is a tossup. All you can do is just hope that you may per chance land at the center.
Treating all member or customer needs as equal parts of a blurry, undifferentiated whole seems comparable to such random target shooting. So is guessing that a lecture or discount are better solutions for the unemployed than, say, peer brainstorming or custom training. Sure there is some relationship between your program topics and the situation but do they address problems that” keep members up at night”? Do they contribute to specific solutions or do they linger in the purgatory of “nice to have but not essential?” To shift from marginal interest to “must have,” knowledge service providers have to invest in unlocking the “heart”—what some call “customer intimacy”–rather than guessing narrow product needs.
How does an organization change the tone of its relationships with customers from distant to intimate?
One approach is to accumulate more and better information about customers in order to respond to increased expectations. An article in Forbes, titled “Enhancing Customer Intimacy” tells us that today’s customers would no longer be surprised and delighted just because a company knows their name and addresses them by it. They already expect this as a basic service. The bar keeps being raised and “today, the amount of data that we need to maintain has grown huge, as has our need to be able to find connections and relationships among the billions of bits of data we have.”
I advocate for a different and far less used approach, which is to look beyond data, to the values, thoughts and motivations that make human beings “tick” and drive decisions. The two approaches are not mutually exclusive. There is no question that more and better market and customer information is needed. But, at the same time, approaches that are largely data-driven tend to reduce the complexity of human beings and their environments to “information” that is easily gleaned through specialized methodologies, terms and tools. This mechanical concept of knowledge creates the dangerous illusion of complete knowledge which, in turn, becomes a major hurdle to effective leadership, growth and innovation. It ignores the confluence of deeper psychological and cultural factors that determine behavior; and the need for competencies such as empathy, discernment, insight, curiosity and strategic intelligence that enable deep connection with peers and customers on a human level.
Leadership and strategy expert Michael Maccoby considers such competencies as the defining characteristics of leadership in the knowledge workplace. This is because the most important leadership requirement today is the ability to motivate rather than control and keep order. According to Maccoby, “the concept of motivation describes the impetus to act with energy and purpose…The challenge for management is to discover what motivates people at work to do what is necessary for the organization to succeed.” How is this leadership challenge different now than in the past? Maccoby argues that:
In the industrial bureaucratic era, motivation for most workers was mostly compliance, showing up on time, and doing what they were told to do. Only a small percentage of managers and professionals was expected to exercise personal judgment. In the techno service era, this kind of compliance is not enough; another type of motivation becomes essential. The organization requires people who are motivated, enabled, and empowered to achieve results by exercising judgment.
Maccoby builds a comprehensive framework for understanding what motivates people and putting in place organization-wide leadership systems and competencies. I see this framework as equally applicable to the relationship between knowledge service providers, such as associations, and their customers. The challenge for them is to discover what motivates their customers to buy a service. The problems that professionals face today are multi-faceted, complex and interrelated. Their most critical needs are for solutions. The more strategic, customized and innovative a solution is, the higher its value. To be able to piece together disparate elements into unique solutions for specific customers time and time again requires a far deeper psychological and contextual knowledge of customers and markets than ever before.
To help leaders develop the ability to motivate employees, Maccoby has developed an index of personality profiles on the basis of motivations. To determine focus, priorities and strategies provider organizations must similarly be able to differentiate among customer/member groups. On the basis of my research and experience so far, I see 6 member/customer “profiles” on the basis of the value they believe they derive from a provider and, hence, their motivation to buy.
- My employer pays, what do I have to lose?
- It seems the thing to do once you are out of school. It doesn’t cost that much, what do I have to lose?
- It is my professional association. It is my duty.
2. Intellectual enrichment :
- I enjoy their annual meetings and make a lot of contacts there.
- I love their journal.
- I take advantage of many of their interesting programs with well known speakers.
- It’s good to be challenged intellectually once in a while.
3. Sporadic practical solutions:
- They have some good benefits but for me what I go to them for is their annual executive program to which I send all my senior staff every year; or
- their new certificate program; or
- tools and data that I depend on to price our new products.
4. Preferred provider for a range of practical needs:
- I depend on them for my staff training needs-from CE credits, to new competencies, certification etc.
5. Strategic, customized solutions
- I don’t know how I could survive as a small independent practitioner without them.
- It’s not this or that thing but the fact that I can pretty much address all my needs through one provider: timely information; quick answers to questions; conversations and collaboration with peers; strategic advice; custom consulting etc.
- This is a community in real time; not just a product or service.
6. Strategic partnership
- My best options for growth are through their growth.
- If I help them include my suppliers or customers among their members, my access to and interaction with them will increase tenfold. We are strategic partners in the health of the entire sector within which our customers and organization operate.
Which of these concentric circles do you aim for in the diagram below? Where would you place your various member groups on the continuum below?
1 Customer Categories on the Basis of Needs
Clearly members at the lower end of the continuum will be the first to leave in the case of tough economic conditions, better choices coming along or similar reasons. Conversely those for whom you were indispensible to some aspect of their success would find it harder to replace you.
However, this is not an either or question but rather one of different strategies for different choices. If you chose to be primarily a practical provider and minimize investment in strategic innovation, for example, you may need to develop strategies of volume and scale and keep production costs down by outsourcing.
If you choose to compete on unique, strategic solutions, you have to embed demand oriented competencies and practices such as (according to the Forbes article):
- Collaboration on product development
- Customer involvement in internal process development
- Customers helping each other to resolve service problems
- Customers involved in long term scenario planning
The point is that whatever the choice, a deep level of intimacy with customers is needed to allow an organization to identify, extract and reconfigure assets into solutions that match specific needs of specific customers and fuel the right motivations. This means investing in unlocking the heart rather than gathering data; and developing solutions to problems that matter the most rather than producing more and more programs for the periphery.