As customer-centric and "voice of the customer" initiatives take hold across many organizations, some businesses are putting one person in charge of their efforts.
This executive, usually called a chief customer officer, customer experience officer, or senior vice president of customer service, requires a specific skill set -- one not easily found, according to Bruce Temkin, vice president and principal analyst with Cambridge, Mass.-based Forrester Research.
"It has to be someone with very high energy because this is a change agent position," Temkin said. "You have to have a lot of energy and, at the same time, a reasonable amount of patience, because nothing in a large organization changes quickly. That rules out 99% of the people in the world."
Temkin interviewed executives from a variety of firms late last year for a clearer understanding of what the position entails and who fits the bill. The chief customer officers he spoke with advised anyone creating the position to ensure that they have the right environment, prepare to take on a broad change agenda, establish a strong operating structure, kick off high-priority activities, and look ahead to the future.
Companies like Bank of America, Chrysler and United Airlines have appointed chief customer officers recently. Some have had better results than others. Sears Holdings Corp. appointed John Walden as its chief customer officer in January 2007. One year later, he was gone, taking a $2 million compensation package with him. But other businesses are beginning to see the benefits of having one person lead the charge toward customer centricity.
Temkin's research found that 54% of North American banks have a chief customer officer or chief experience officer. As of last fall, about 40% of companies Forrester surveyed had someone in a role of managing customer experience across products and channels, he said. For large companies, one out of three has someone in a senior role starting to look at creating the position.
Aside from requiring both high energy and patience, the position demands a number of other skills.
"In my mind [a company establishing a chief customer officer] needs to hire someone who, first and foremost, can build bridges across organizations, deal with executives," Temkin said. "This role is never someone that owns the process. It's someone who facilitates change across the organization."
Companies are best served hiring someone from within, he added. An internal candidate brings instant credibility. That's important because the position is not like that of a general manager who can simply come in and tell people to stop one practice and start another, he said. It's not about owning the process; rather, it's about driving change.
Also, there aren't many long-standing chief customer officers. Looking outside the organization for someone with experience is not yet really an option.
"Some have been at it a little longer, say 18 months, but most have really started within the last year," Temkin said.
The chief customer officers he spoke with generally had a small staff -- anywhere from 10 to 20 people.
Typically, chief customer officers report one level below the chief executive officer, answering to the head of marketing or to the head of a business unit who reports directly to the CEO. While the backgrounds of the chief customer officers Temkin spoke with vary greatly, they tend to come from customer-facing jobs -- some from marketing, some from the contact center. Others come from the online operation, he said, because they are often the first to look at user-centric and customer-centric activities.
The chief customer officer's responsibilities
Chief customer officers or customer experience officers are generally responsible for four areas, Temkin said. They're responsible for customer research, such as loyalty metrics and net promoter scores. They also act as consultants of sorts, doing ethnographic research and process mapping. And any chief customer officer should be responsible for communicating with the company's employees.
"A lot of what the work is for a chief customer officer is culture change," Temkin said, "and you really need to do a good job of communicating."
That includes listening. Front-line employees can be some of the best advocates for the problems that customers are encountering. In fact, chief customer officers should map out customers' end-to-end experience, Temkin suggests.
Finally, chief customer officers should take charge of, and own, the customer experience metrics. It is important, however, that they are not solely responsible for those metrics.
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"This job is about helping the rest of the company improve, not taking responsibility for the improvement," Temkin said. "At the end of the day, you still have to have an executive team responsible for running the business. The only way to proceed is to get customer experience embedded into what they're doing."
Companies that require chief customer officers to improve the net promoter score (whether or not a customer is willing to recommend your company to someone else) are not taking the right approach.
"It's the kiss of death if the company turns to the chief customer officer and says, 'You're responsible for improving our net promoter score,' because then the rest of the execs wash their hands of it," Temkin said. "Then it doesn't happen."