What is the Impact of Customer Centricity?
How to Identify and Set Business Goals that Focus on the Customer and Spell Success for Your Business
Winning and keeping business – that’s the ideal scenario, right? All business decisions and operations are conducted with that scenario in mind, and at the center of it all is one incredibly important component: the customer. Professional services businesses, in particular, have to be hyper-focused on the customer, which demands a customer-centric business model. Chances are you already put a great deal of energy into the customer experience – but are you seeing the impact of customer centricity on your business?
Identify the positive impact a customer-centric business model can have on your organization, especially in professional services, so you can better understand what’s working and where you can make your customer even more “centric” to your operations.
Defining Customer Centricity at Your Organization
Before we dive into the impact customer centricity can have on your business, let’s talk about how customer centricity is defined, and what it might look like in practice.
According to Gartner, being customer-centric means that people within an organization are able to understand customers’ situations, perceptions, and expectations, and are able to put the customer at the center of all product-, service-, and experience-related decisions with the goal of creating customer satisfaction, loyalty, and advocacy.
That’s a mouthful – but what we like about this definition is that it identifies customer centricity as something all the people within an organization are responsible for. It is not under the purview of just one department or role; it is something that must be driven by everyone.
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Of course, an all-hands-on-deck approach wasn’t always the approach. Much has changed over the years as customer behaviors and the market itself have shifted. Let’s look at a few ways in which how we focus on the customer has evolved over the past decade:
C-Suite Involvement: Not long ago, the C-level executives at companies were largely unconcerned with the customer-facing aspect of their roles, instead mired in their day-to-day internal functions. Now, business leaders understand that a customer-centric mindset must come from the top and be woven into the very mission of the business and the culture of its people.
The Buyer Journey: We have long thought of the buyer journey as a linear one, where customers seamlessly go from exploring their options to learning more, to making a decision and becoming a customer. Today, the buyer journey is anything but straight as individuals are influenced at every turn and might look at a multitude of information before making a decision. True customer centricity recognizes this real buyer journey and accounts for all potential touch points.
Departmental Functions: Professional services organizations with multiple departments have often fallen victim to siloed operations. People focus on executing their work without taking in or sharing customer information and data with other employees. This disconnected approach runs counter to customer centricity as it’s difficult to adequately service customers when all employees at each touch point aren’t privy to pertinent customer information.
A Single-Source-of-Truth: One reason departments can become siloed is there is no central repository for customer data that can be accessed by all involved parties. For years, companies did not place a great focus on integration; however, a single solution that automates your professional services and connects your entire enterprise is vital today to put everyone on the same page and enable better customer experiences.
Collecting and Using Data: Just because organizations have data doesn’t mean they’re properly employing it. Data can be found everywhere these days and collected just as easily, but effectively leveraging it to improve the customer experience is another thing entirely. Today, failing to use your customer data to inform and improve the customer experience is a big miss for any organization. Leverage predictive analytics to generate valuable insights about customers, projects, and associated finances, improving customer interactions and planning.
Take a moment to reflect on the evolutions in customer centric behaviors we just covered and whether your organization is operating more in the past than for today’s workflows. We would argue that failing to adapt lessens the impact of customer centricity on your business.
The Biggest Barriers to Becoming a Customer-centric Business
How Can I Identify the Impact of Customer Centricity on My Business?
If employed correctly, there are many positive impacts a customer-centric model can have on your business.
Like any traditional cause-and-effect scenario, the high-level overview is quite simple:
Increased Customer Focus → Happier Customers → More Business
We’ve overly simplified the equation, but within each of these “steps” are positive impacts on your business that go far beyond just “more sales”.
The Impacts of an Increased Focus on the Customer
Depending on your specific organization, there may be more positive outcomes from an increased focus on your customers, but the following are the ones that stand out to us:
Business Operations Designed Around the Customer
A customer-first mentality impacts all areas of business operation, from corporate structure to sales and financing. Rather than interacting with your customers on an as-needed basis, your business is now providing exceptional service, timely communication, and expert assistance at every turn. Those are incredibly valuable impacts on the way business is conducted.
A Well-Defined and Strong Brand Purpose
As mentioned above, when leadership adopts a customer-centric approach, it sets the tone for how business is run and creates a customer-focused mindset and culture. Infusing customer centricity into a businesses’ atmosphere ensures it will remain top-of-mind and drive decision-making – in turn strengthening your brand with a mission all employees play a role in.
A Clear Understanding of Your Customers
Too many companies don’t have a great handle on their actual customers and how to best serve them. When you put the customer at the center, it forces you to understand who they are, what they need, and how you can effectively interact with them to solve their problem. This knowledge is great for your business and great for your customers.
A Future-Proof Data- and Technology-Driven Approach
To be customer-centric, organizations get the most benefit from a single-platform solution, such as Professional Services Automation from FinancialForce. This type of solution takes your existing systems and consolidates them onto a single source of truth with enterprise-wide visibility. This way, your teams can focus on their customers, see how each customer process impacts each department, and access data from other departments, triggering communication with a customer or internal followups. Plus, you’ll be ahead of the curve with the technology that’s driving professional services tomorrow – not yesterday.
Gaining a Strong Competitive Advantage
Giving your customers the best experience is a highly-effective way to separate your business from the competition. In today’s economy, where consumers are highly discerning, have little patience, and expect brands to meet them where they are – and anticipate where they’re going – delivering on these expectations can secure a sale with your business – even if the price is higher than a competitor. Customer experiences are everything, and you can stand apart by offering the best one.
Here are the 10 primary advantages of a Salesforce-native ERP system that will help position your business for success.
1. Maximized planning and resource management
Enterprise Resource Planning is aptly named because it truly does enable planning across your organization so you know how to predict and forecast sales, costs, and the resources you need, whether that’s materials, equipment, or people.
ERP provides insights that enable you to effectively plan production schedules and forecast resource needs. When you can be predictive with events like equipment maintenance or order fulfillment, you can reduce unexpected downtime or production delays.
Better planning and resource management enable business leaders to make more effective decisions and overcome challenges across the entire business.
2. Greater enterprise collaboration
Personnel are often siloed across an organization, but ERP consolidates information from all departments into a single source of truth, making it simple to share accurate data in real-time.
Making all data available in one place, updated in real-time, has several operational benefits:
- Reduce errors often caused by using incorrect or outdated data
- Keep projects that otherwise could have been stalled due to a lack of information on track
- Graduate from merging disparate data sources and be confident in the accuracy, completeness, and security of your ERP-enabled data
- Eliminate human error that can come with manual data entry processes
3. Increased productivity
By automating major processes like inventory tracking or invoice generation, you can realize productivity gains across the board and place greater focus on tasks that may have otherwise fallen by the wayside.
And, we can’t restate enough the incredible time savings of having a single source of truth for data across departments. Manual data entry processes that took up valuable time in the past are now handled automatically – and with greater accuracy to save time on revisions.
ERP can perform advanced calculations quickly and automate tedious tasks. Your employees can place greater focus on a project, create more revenue-generating work, and use their time more efficiently and profitably.
Enabling teams to collaborate using accurate information enhances the success of your projects and ultimately brings about greater customer service.
4. Reduced overhead costs
When used properly, ERP systems can deliver significant cost savings to your organization.
- Prevent disruptions and delays that can be caused by a lack of accurate or available information, keeping projects on track and on time.
- Skip the additional personnel, software licenses, training on multiple systems, and administrative resources needed for traditional data unification software; ERP can be easily adopted and leveraged by existing staff.
- Streamline operations by making the tools for everything from product development to accounts payable available in one centralized system.
- Empower your team to use their time more efficiently by giving them the information and data they need, right at their fingertips.
Additionally, an ERP system provides greater visibility into changes in cost. Let’s say you typically pay $1 for a part, but suddenly the part costs $3. ERP will make it easy for you to see that cost differential so you can explore a different vendor or make adjustments to your budget to accommodate that additional cost.
5. Better customer relationships
Using ERP on Salesforce allows for integration with your Salesforce Customer Relationship Management (CRM) platform, drastically expanding the visibility you have over your operations. All customer information from purchase history to personal data is stored in one place and feeds directly into your ERP system to enhance the customer experience.
Using your ERP and CRM together, you can automate customer services like payment notifications for existing customers, or lead nurturing tactics for prospects currently in the sales pipeline. You can also enable sales and marketing teams with greater information to help close a sale.
Here are some other key benefits of an ERP and CRM solution:
- Streamline invoicing and accounts receivable
- Close the books faster at the end of each month
- Reduce billing or invoicing errors for a better customer experience
- Put customers in the driver’s seat with customized dashboards and portals
- Connect product, sales, and finance teams for alignment on product offerings and available revenue streams
- Generate impactful global financial reports using built-in analytics powered by Salesforce Tableau/Einstein
- Offer actionable, easily digestible information to your entire team through real-time dashboards
6. Improved quality control
Quality management is a significant benefit of an ERP system. Let’s say you have a product that has just completed the manufacturing process, but before you can sell the product, you still need to review and sign off on the corresponding paperwork. You can tell your ERP system that the product must be blocked from sale until the paperwork is approved.
This type of control over your internal flow of supply reduces the chance for error; i.e. someone clearing out a product that has not yet been officially released.
Additionally, ERP provides checks and balances over the system itself, so you can allow only the appropriate people to create or edit information, but make the information visible to those who need to see it. This kind of quality control over sensitive and timely data reduces human error and saves time when processes move more seamlessly among departments.
7. Better inventory tracking
Tracking and monitoring inventory is a challenge, especially for large companies that constantly have products coming in and going out and a high level of customer demand.
ERP systems are able to track individual inventory using serial numbers or RFID tags, and simple system inputs allow you to maintain visibility over all of your assets, even at different locations or when they’re in transit.
Supply chain management is simple, too – ERP simplifies logistics and distribution, and can be programmed to manage inventory goals and reduce inefficiencies.
What’s more, inventory tracking using an ERP system provides highly accurate inventory data for metrics like customer demand, the cost to ship or store, and over-or under-stocked items. In short: ERP allows you to better manage your inventory and control how costs are allocated.
8. Simplified risk management & regulatory compliance
Every business takes on some form of risk in the process of creating and disseminating products. ERP helps minimize those risks by reducing the likelihood of errors in accounting and financial processes and allowing for greater visibility and control over operational details. With forecasting tools, you can see whether you’ll need to increase labor to handle a busy season or ramp up production to handle growing demand.
Where revenue is concerned, every industry carries recognition rules and other compliance regulations that can result in fines or penalties if not properly managed. For this reason, companies need to be extremely accurate for IRS compliance, and an ERP system allows you to manage your finances accurately, legally, and easily with built-in auditing tools and easily generated reports.
9. Enhanced data security
Using ERP on Salesforce is the most secure way to store your data, hands down. ERP systems in general have built-in security controls to ensure data protection, but when used on the Salesforce platform, you get the benefit of the massive investments Salesforce has made into its security, ensuring the most up-to-date capabilities for event monitoring, authentication, encryption, and more.
10. Predictability & scalability
Without question, an ERP system allows your business to be more predictive, driving better business results that enable you to scale. You’re able to combine real-time data with greater flexibility and visibility, which gives you an enormous advantage when it comes to efficient product development.
Not to mention, changes in the market won’t have you stalled and grasping for a plan. You’ll already have accounted for fluctuations so you can keep your business running smoothly.
The Impacts of Making Your Customers Happy
Happy customers are never a bad thing, and the more you can do to create them and retain them, the better.
Building a Strong Brand
When you’re happy with a brand, you go back to it. That act of loyalty is gold for brands; so treat it like it’s worth as much or more! The more brand loyalty you can establish, the stronger your brand will be – and growing loyalty helps empower your employees, too.
Happy customers talk about their experiences – but so do unhappy customers. The ones who tell the good stories are evangelizing your brand and driving potential new customers your way. Putting each and every customer at the center of your business – regardless of the size of their spend or even if they haven’t made a purchase – is critical for this reason. A lower-budget customer who brings you 10 new customers is just as valuable as a one-time, big-budget customer.
Gathering More Information
When your customers are feeling taken care of by your business, they’ll trust you and be more willing to provide personal information. Collecting detailed customer information elevates the level of service you can provide, whether through timely communications or more personalized interactions. Gathering information is especially critical for driving potential customers toward a purchase with the right messages at the right time.
The Ultimate Impact of Customer Centricity – More Business
To reiterate the first line of this post, winning and keeping business is the ideal scenario and the desired outcome of a customer-centric business model.
The operative word? “Keeping”.
Once you win the business, customer centricity is just as important as it was before the sale.
Existing customers are still on their buyer journey. Putting them at the center of everything you do ensures you won’t miss opportunities to upsell or cross-sell, and enables communications that keep your business top-of-mind as they make future buying decisions.
Plus, as we mentioned above, long-time, happy customers will talk about your brand and help drive additional business.
Bear in mind that while attracting more business might be the ideal outcome, it should not be the ultimate goal. Based on the positive impacts we laid out above, it should be clear that customer centricity is your goal – it is from a customer-centric business model that all else follows.
What Does a Customer-Centric Model Look Like?
Developing and adopting a customer-centric business model is a great way to ensure your operational activities are indeed focused on the customer first. Here are a few elements of a customer-centric model to inform your approach:
It can be difficult to exercise empathy in our personal lives, let alone for our customers. Being empathetic in business essentially means your employees are able to identify a customer’s emotionally-driven need, understand their “pain points” that drive that need, and address that need appropriately. And this practice of empathy isn’t common – PWC found only 38% of consumers feel that employees they interact with understand their needs. Developing customer personas and helping employees understand customer motivations is an effective way to create more empathetic interactions.
Bake Customer Centricity Into Your Culture
From the get-go (including job postings, candidate screenings, and onboarding) it should be made clear that you are an organization focused on the customer. Doing so will not only help you identify candidates who can contribute (or might detract) from this focus, but it raises the bar for the type of culture at your company.
Go Beyond Personalization
Truly customer-centric organizations are combining a personalized experience with a connected experience. Demonstrating to your customers that you understand their unique business needs is wonderful, but a sloppy handoff between departments that undermines the sale essentially cancels out any level of personalization. Democratizing data and customer information is vital to taking employees out of a head-in-the-sand mindset of performing one sole function, and instead integrates their role into every aspect of the customer experience.
Putting the “customer” in “customer centricity” means shifting the way your business thinks about a successful transaction. Instead of focusing on whether you got the business, or how large the sale was, place the focus on whether the customer’s needs were met and if they had a good experience. How can it be improved next time? What went right or wrong, and why? For big transactions, a debrief is often a helpful way to close the loop on service delivery in a customer-centric model.
Realize the Value of Direct Interaction Often, we get comfortable managing everything, including customer relationships, via email or even text message. Placing an emphasis on interacting with customers, whether on the phone, over a Zoom call, or in person, elevates your approach to customer centricity.
Empower Employees Around Customer Success
When your employees can feel the benefit of successful customer interactions, they’re more motivated to not only put in the work, but to employ the tenets of customer centricity. Share victories, make sure each employee understands how customer outcomes impact their role and the overall business, and set incentives tied to sales. These actions show every employee how they are an integral part of the overall customer experience.
The positive impacts of customer centricity on business are hard to ignore – and you are likely already enjoying many of them. However, today’s business climate is fast-paced and demanding, and it can be difficult to fully execute a dialed-in customer-centric business model.
Leveraging a single-platform approach to Professional Services Automation from FinancialForce is a great way to start. Contact us today to schedule a demo and learn more about how you can leverage FinancialForce PSA on the Salesforce cloud platform to streamline your operations and put your customers at the center of everything you do.