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Becoming a Customer Centric Organization: Challenges and Opportunities

A paper submitted to the conference on Service Strategies for Global Leadership

Organized by SDMInstitute of Management Development, Mysore 23&24th July, 2009

By

Prof.Shailendra Dasari
Faculty Member ICFAI Business School Kanakapura Road Bangalore-560062 E-mail: shailendra.dasari@gmail.com

Becoming a Customer Centric Opportunities

Organization: Challenges and

Make your customer the center of your culture: John Chambers, CEO, Cisco Systems

Introduction
Marketing in the new millennium has become more complex and challenging. Marketers had come a long way from the product-centric approach prevalent in the early 20th century which was replaced by process-centric approach during the last two decades of the 20th century .However the realization that process excellence alone can not make them winners in the market place had slowly dawned upon them and for the past decade or so their focus has shifted to becoming customer-centric organizations driven by long term partnerships with all the stake holders. Services which have overtaken agriculture and manufacturing sectors in the last two decades, contributing 50 to 75% to the GDP of developed as well as developing economies have opened up a host of new opportunities for marketers. Changing needs of customers due to the changes in lifestyles, employment patterns, family structures; emergence of DINK 1and DISK2 families; increased life expectancy and mobility of people of all age groups ; globalization and removal of trade barriers and IT explosion have thrown open a number of opportunities for service organizations. The distinct characteristics of services viz. intangibility, inseparability, heterogeneity and perishability call for a different marketing approach for services as opposed to goods. While the opportunities services present to marketers are plenty so are the challenges.

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Double Income No Kids Double Income Single Kid

Objectives of this paper This paper addresses the following points pertaining to customer-centric service organizations 1. The need for service organizations to be customer-centric 2. Characteristics of customer-centric organizations 3. The challenges organizational leaders have to surmount for creating customercentric organizations 4. How customer-centric and innovation-centric approaches complement each other 5. Success stories of customer-centric global organizations 6. How Indian companies can negate the effect of economic slow down and keep winning in the market place 1. Need for service organizations to be customer-centric Customers in the new millennium have many more choices when compared to what they had a decade or two earlier. It is no exaggeration that most of the marketers, particularly in the services sector have to slog it out in a market heavily biased in favor of buyers. Customers today are more knowledgeable, demanding, valuediscretionary options conscious, very clear about their choices and above all environmentally aware. Customer centric orientation therefore is no more one of the marketer can toy with but something which is mandatory for the survival and growth of ones business. The core strength of world class organizations like P&G is a deep understanding of customer and placing them at the center of all decision making3 Being customer centric, though mandatory, offers the following competitive advantages to service organizations. 1.1. Service Differentiation-To stand out in the clutter at the market place one has to differentiate ones self from others. Degree of customer-centricity is indeed a good differentiator .According to Philip Kotler (2008) to avoid the commodity trap marketers must start with the belief that you (sic) can differentiate anything 4.While
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A.G.Lafley and Ram Charan, The Game Changer,(New York: Crown Business,2008)p.13 Philip Kotler, Kevin Lane Keller, Abraham Koshy and Mithileshwar Jha, Marketing Management A South Asian Perspective (New Delhi: Pearson Education India ,2008)

service features, price, quality etc have been the traditional tools for differentiation, customer-centricity, being an ethos which encompasses all functions and departments and not just a marketing tool proves to be an effective differentiator. 1.2. Relationship marketing: A way of life -Customer-centric organizations are likely to pursue relationship marketing, which emphasizes the importance of building up long term relationships with the stake holders, as opposed to transactional marketing. As opined by Zeithmal et al (2006) If companies know how much it really costs to lose a customer, they would be able to accurately evaluate investments designed to retain customers 5.Customer life time value and life time profitability are the concepts that help understand the economic value each additional customer that remains loyal to an organization adds instead of switching over to a competitor. Findings of research conducted on the subject suggest that a 5% increase in customer retention can boost the profits by 35-95%. 6 1.3. Mass customization skills- Companies which embrace customer-centric approach will build up the expertise to manage the complexity and divergence of customer needs through mass customization. This makes the organization more pro active, creative and innovative apart from empowering the employees-all of which are characteristics of a progressive organization committed to continuous improvement. 1.4. Customer as a co producer-Students of Services Marketing know the importance of service providers collaborating with customers to design, develop and deliver customized services. Customers who play an active role during the production and delivery of the service are less likely to be dissatisfied with the quality and utility of the service. They will also be the brand ambassadors of the service organization and help generate favorable word-of mouth publicity which is invaluable

2. Characteristics of a customer-centric organization

Valarie A Zeithmal ,Mary Jo Bitner, Dwayne D Gremler and Ajay Pandit,Services Marketing :Integrating Customer Focus Across the Firm(New Delhi: Tata McGraw-Hill,2006,Special Indian Edition),p.191 6 Ibid,p.192

Customer centric organizations

realize that employees are the biggest asset for

maintaining the quality and consistency of service demanded by a customer .They give lot of importance to recruiting, training, empowering and retaining their employees. They also maintain open communication channels with their customers. The following distinct characteristics process-centered organizations. 2.1.Strong internal marketing: Internal marketing intended to maintain a healthy twoway communication between the management and front line employees on the one hand(vertical communication) and among the frontline and back-stage employees on the other(horizontal communication) is the strong foundation which supports the super structure named customer-centric orientation. This encourages open ness, team work and ownership at all levels of the organization. 2.2. Empowerment of employees: People who work for customer-centric organizations are not afraid of taking decisions on their own, to ensure customers are fully satisfied every time they avail themselves of the service. Self-directed work teams and multi skilled work force also ensure quick service recovery, should any service experiences turn unpleasant for the customers. 2.3. Training and development: Customer-centric organizations invest a lot on training their employees, not necessarily on productivity-improvement techniques but on development of soft skills, inter-personal skills, changing customer needs, business communications and team work. It is the attitude and actions of employees at all levels that manifest the customer-centric ethos of the organization. Not mere lip-service by top management. 2.4. Provide open-access to customers to voice their views: Customers are constantly encouraged to share the good or not so good experiences with the senior management, in companies that are customer-centric. Formal channels like help line, feed back links on companys portal, suggestion boxes at the servicescape which can be easily accessed by customers are provided by such organizations. They also have a formal organizational mechanism to review the suggestions and complaints received from customers and take immediate action which customers are kept informed of. differentiate them from product-centered or

Strong Internal Marketing

Empowered employees Customer-centric organization

Training & Development

Open-Access to customers

Figure1- Customer-Centric organization As aptly summarized by Bill Gates in his path breaking book, Business at the Speed of Thought, Information flow is the primary differentiator for business in the digital age7

2.5. Marketing is every bodys business: Customer-centric organizations believe that the entire organization, from top to bottom is responsible for delivering value to customers.
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Bill Gates and Collins Hemingway, Business @Speed of Thought: Using a Digital Nervous System(New York: Warner Books,1999)

They practice the Japanese concept of Okyaku-sama which means honored customer or the Customer is God8 3. Challenges for bringing about customer-centric orientation An organization which wants to change its orientation to being totally customer-centric has to be prepared to overcome lot of challenges in terms of resistance of employees to the cultural changes such an orientation demands, training to be imparted to employees at various levels, processes to be followed, systems to be adopted and the structure around which various activities have to be organized. Culture of a customer centric organization encompasses the following. Values and beliefs of top management Degree of participation of employees in various organizational processes Interdepartmental interactions Organizational systems and procedures

Conviction and commitment of the top management is a must for an effective changemanagement. They have to demonstrate their commitment by practicing the values they want every one else in the organization to imbibe and walk the talk. According to Lafley and Ram Charan The leaders most important job is to create a culture in which people feel free to express ideas-in short to take the fear out9 Encouraging uninhibited vertical and horizontal communication will go a long way in motivating the employees to participate actively in the various organizational processes such as training, performance reviews, appraisals, counseling, mentoring and working in teams. It is also important for various functions/departments to have a collaborative approach so that the entire organization is responsible for providing value to customers and not just the marketing department or front-line employees.

Harvey.B.Abrams and Theresa Hnath Chisolm, Quality: The Controlling Principle of Practice Management in, Audiology: Practice Management ,ed .Holly Hosford-Dunn, Ross .J.Roeser and Michael Valente ( Newyork:Thieme,2008,2nd edition)p.35 9 Lafley and Ram Charan, The Game Changer ,p.236

A culture which encourages trust, mutual respect and free and frank exchange of views is what makes an organization customer-centric.

Systems and procedures followed by the organization should support this culture. It calls for transparency, open ness, and rewarding employees who take on the spot decisions for resolving customer-related issues. Flexibility, agility and speed are the key characteristics of customer-centric behavior in the context of services, which need to be fostered and encouraged. In addition such organizations have to institutionalize Responses to dynamic environment Dual emphases on customer and competition Long term view of business Market environments keep changing ,more so in the case of services, due to emergence of new technologies, changing life styles of customers, increased customer expectations and entry of new players who may have the skills and expertise to deliver better value to customers. An organization has to stay connected with the market to pro actively upgrade their skills, technology and processes to counter the competition and maximize value for customers. Both competitors and customers therefore become the focus of attention for organizations who do not want to be left behind. At the same time they have to shed the transactional mind set and concentrate more on building long term relationships with customers which are mutually beneficial. For the above to become a reality and not just a dream the top management has to play a very positive and active role as the employees look up to them as role models for cultivating such proactive, customer-centric behaviors.

4. Organizations have to be innovative-centric to be customer centric

According to Jeff Immelt, CEO of GE Innovation without a customer is nonsense. Its not even innovation10 Lafley and Ram Charan, assert that the company that fails to innovate is on the road to obsolescence11.They do not mince any words when they say No matter what your job is as a middle manager you must practice and master the art of observing customers and detecting insights for innovation12 Being innovative- centric therefore becomes a basic requirement of progressive customer-centric organizations which have to be on the constant look out for innovations for adding value to customers .Innovations are not confined to new products or services but could be in terms of functions, logistics, business models and processes.13 Innovations need not always be break through innovations14 .Incremental innovations15 ,in fact would ensure a steady pipeline of innovations in the organization, ammunition for remaining ahead of competition. While innovation-centric culture helps organizations to sustain their customer-centric orientation, being customer-centric on the other hand supports innovation-centric culture. According to Jeff Immelt innovation can not happen without getting close to customers. 16. Unless businesses are organized in such a manner that facilitates them to get to know their customers and serve them better, it will not be possible for them to maintain a steady flow of innovations.

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Lafley and Ram Charan, The Game Changer ,p.21 Ibid,p.23 12 Ibid,p.27 13 Ibid,p.25 14 Break through innovations are the radical, new to the world innovations which are rare but extremely valuable to the organization 15 Incremental innovations pertain to continuous improvements that add value to processes, products and services 16 Lafley and Ram Charan, The Game Changer,p.287

Customercentric orientation

Innovativecentric orientation

Customer Delight

Figure 2-Customer Centric and Innovation Centric orientation From the above it is very clear that customer-centricity and innovation-centricity complement each other so well that those organizations which embrace one of these as their strategy for growth and profits will not be able to ignore the other.

5. Success stories of customer-centric organizations


We now look at the success stories of two of the world-class organizations which are customer-centric. 5.1. FedEx FedEx is a world class logistics solution provider. They have pioneered many revolutionary concepts in logistics domain and are renowned for their customer-centric innovative approaches. During their early days they had gone to the extent of chartering a flight for delivering a wedding gown to a customer at a remote location in USA.17 The success and phenomenal growth of FedEx is solely due to their customer-centric orientation right from the time they started their operations.

17

Basch Michael .D, Customer Culture,(New Jersey: Prentice Hall PTR,2003),pp 10-11

Let us look at how FedEx had helped another world class organization Philips to solve a major logistics problem and save millions of dollars in the process.18 Philips is one of the leading manufacturers of semiconductors in USA with clients spread all over the globe. Philips management realized that their supply chain was not equipped to handle the demands of their customers for faster service and shortened cycle time. As a short term solution they began maintaining buffer stocks in remote depots. This however added to the inventory. Because of longer transportation cycles, at any point of time $2-4 million worth of inventory was in transit and therefore inaccessible. In spite of all these measures with substantial cost implications, customers were still not very satisfied because of late shipments and longer response time. Philips desperately needed a better solution. They were on the look out for someone with worldwide reach, speed, reliability, integrated information access, and willingness to invest in the infrastructure and staff support After spending a year searching for the right solutions provider Philips zeroed in on FedEx. Their customer-centric approach manifested by their proven expertise in shipment visibility, world class fool-proof tracking system and above all willing ness to invest on infrastructure for providing a solution to customers problem ,well supported by excellent human resources did wonders for Philips. Customer response time of Philips had comedown to less than five days which was more than two weeks before FedEx stepped in. Savings in terms of reduced inventory was quite substantial. Now we can support sales growth and customer demands for safety stock without adding inventory, and our end-customers have much more confidence in our ability to meet delivery commitments consistently. says Jim Harbinson Logistics Director of Philips, North America.

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http://images.fedex.com/us/supplychain/casestudies/philips.pdf

5.2. IBM-DOF Management: Partners in Success19 IBM ,the world class IT solutions provider and DOF management, Norway provider of vessel and crew management services to oil and gas sector world over , with a fleet of 70 specialist offshore/sub sea vessels, came together with amazing results . The projects DOF are associated with are very prestigious and fairly large posing financial, environmental, and health and safety challenges of a complex nature. DOF plans all the projects with care, precision and attention to detail and in the process large volume of correspondence is generated. Documentation of this large volume of material became a serious problem. It was not unusual for the users to spend 30minutes every day just to find the right documents. Traceability of documents was another issue as there was no fool-proof way to find out the origin of documents and who carried out subsequent editing and revisions and when. Further the limited options on sea and under sea vessels had to communicate with on shore servers and problems of lower band width of satellites used for communication added to the complexity of the problem. DOF approached IBM, who had the expertise in content management and successfully launched Document Manager, to help them solve this problem. IBM recommended Ergo Group, a business partner of IBM with a successful track record of offering content management solutions. A two-phase implementation of content management module first at DOFs main data center providing access to branches located all over the world and later extending access to the fleet was agreed upon. The potential cost savings for DOF, based on a detailed cost-benefit analysis estimated at 630000 Euros per annum. (Saving of 115 hours per person per annum) According to Leif S. Jacobsen, CIO of DOF Management, The feedback from our users about the IBM Document Manager solution is very positive, and we have much greater security, better version control and improved traceability. Once the second phase of the project goes into production, the benefits will be even more significant helping DOF improve its service to customers and increase internal efficiencies. was

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http://www-01.ibm.com/software/success/cssdb.nsf/cs/STRD-7SNJTW

The above case study demonstrates the customer-centric orientation of IBM who apart from offering the right product(Document Manager) , studied and understood the end customers needs, suggested the right partner, provided expert service to the business partner and their customer to design and implement the project successfully and in the process met the derived expectations of end customer . Both FedEx and IBM are most admired global companies who have always kept the customer on the center stage and aligned all their efforts for the ultimate delight of the customer. There are some Indian companies also who have been very innovative in managing their business operations with the ultimate objective of providing delight to various stakeholders. Let us have a look at some of them. 5.3. Success story of Amul: Innovations in supply chain management Gujarat Cooperative Milk Marketing Federation(GCMMF), marketers of Amul brand of dairy products collects close to 6.5 million liters of milk from over 2.2 million farmers, most of whom are illiterate, processes the milk, converts it to branded packaged products and delivers over Rs 6 crores worth of goods to over 500000 retail outlets in India every day20. They achieve this mind boggling feat by following an innovative supply chain model known as Time Based Military Technique (TMT).21 GCMMF have also successfully implemented the Geographical Information System (GIS) at the milk collection points as well as the product distribution points.22 All these initiatives have resulted in reduced wastages, faster cycle time and availability of fresh products to consumers. GCMMF have also provided all the necessary facilities for testing and grading of milk at the collection points to ensure that payments to farmers are made on the spot. Their technological infrastructure enables them to make 10 million error free payments every day totaling to 170 million rupees.23
20

http://www.rediff.com/money/2005/sep/23spec.htm

21

http://www.amul.com/kurien-annual05.htm
http://www.rediff.com/money/2005/sep/23spec.htm

22

Arindam K. Bhattacharya and David C. Michael, How Local Companies Keep Multinationals at Bay, Harvard Business Review, March 2008
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Mumbai Dabbawallahs who provide meals collection and delivery service with a precision of 0.15 PPM, CavinKare who have revolutionalized the rural distribution system, Basix who have changed the rules of the game by taking micro financing to the doorsteps of rural customers in A.P and Karnataka (cumulative lending of over 1000 crores) are the other examples of customer-centric companies that have achieved service excellence through their innovative approach.

6. How Indian services marketers can use customer-centricity as a strategic weapon


Services sector contributes over 60% of Indias GDP. Though this figure is considerably less than some of the developed countries (where services contribute as high as 75% of GDP), it is one among the best for developing countries. Knowledge Management, ITES, Hospitality, Healthcare, Insurance, Entertainment, Retail, Insurance, Banking, Financial Services and Communication are some of the fast growing services in India. India, like many other economies, has been affected by the global economic melt down. .Fortunately the effect of melt-down on Indias economy is not that severe as it is in USA and other developed countries. We are still hopeful of growing at 6.8% and markets are showing positive signs of recovery. While IT/ITES sectors have been adversely affected due to global economic-slow down and appreciation of rupee vis--vis dollar, all the major players have their own riskmanagement strategies in place and have not put all the eggs in the same basket. Exports, no doubt have slowed down considerably. But given the fact that exports account for only 17% of its GDP India inc. can still bounce back to a healthy, growing economy, considering the huge domestic potential for goods and services propelled by a population of close to 1.2 billion. Services marketers, who reaped the benefits of economic boom which lasted for more than 6 years (2002-08), have to now pull up their socks. While they could get away with lack of professionalism, customer-focus and accountability under the shelter of an emerging economy whose learning curve has still not reached a plateau, any further

complacency and lethargy on their part will not be tolerated by customers, who want the maximum value for their money during times of recession and have zero tolerance for any service lapses. Indian services sector comprises of two distinct categories of service providers a) Global multinationals that set up their shop in India, either on their own or through strategic partnerships with local firms b) Local companies who jumped into the fray looking at the tremendous opportunities offered by this sector Unfortunately both the above groups have so far not lived up to their expectations with regard to quality of service provided for totally different reasons. The global MNCs made the mistake of trying to replicate the best practices that worked back home, which unfortunately have not been very effective in India due to the local social, cultural, and emotional factors which are entirely different ,which they had failed to read. The local players, on the other hand have failed to shed their approach and customer-centric orientation. Further though most of the sectors have opened up and have quite a few private players, key sectors like Railways and Surface transportation (highways) still continue to be monopolies owned by government where more of a lip-service is provided than real service. Following are some of the strategies which all the service providers have to adopt, irrespective of their pedigree to survive the economic slow down, which is the immediate priority and ensure longevity. 6.1.Stay connected with customers-Understanding the customer is the basic requirement of any marketer .In a country like India with diverse cultures , religions, linguistic group and geographical regions it is easier said than done. It calls for real immersive research like Living it24 .and Working It25 practiced by world class organizations like P&G.
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product-centric orientation, the

comfort of which they had been used to for generations and grossly lacked a long-term

Living it is a practice pioneered by P&G where in their marketing personnel live in customers homes for few weeks to observe from close quarters usage patterns of various products and develop a more complete understanding of their needs and preferences(For further details please refer Lafley and Ram Charan, The Game Changer,pp48-49) 25 Working it ,a practice initiated by P&G provides employees with the opportunity to work behind the counter of a small shop to gain better insights into the shopping habits of consumers.( (For further details please refer Lafley and Ram Charan, The Game Changer,pp48-49)

No published reports or book can be a substitute for the first hand knowledge gained through immersive research .Organizations that tend to overlook the importance of immersive research were made to eat a humble pie by Indian consumers. Companies like Kelloggs, Sony-Erickson and Virgin mobile have learnt it the hard way. Further it is too nave to assume that customer expectations remain unchanged for a very long period. Thanks to globalization, advent of internet and increase in foreign travel, customers are more exposed to the latest goods and services on offer and none wants to settle for the second best or third best. Having an effective customer-feedback system therefore is an absolute must. MNCs should realize that Indian markets are not what the USA or European local factors. Local players, who do not any more enjoy the state protection, have to change their basic orientation and out look and organize themselves around the customers by identifying their needs and adding value to them, on which their survival and growth are highly dependent. 6.2. Uphold values that demonstrate customer-centricity- Values reflect the philosophy of the top management which form the binding thread of an organization. Values emerge from the personal struggles, experiences and learnings of the founders and therefore should remain sacrosanct. They help an organization generate the trust and confidence in the minds of customers. Colonel Sanders, founder of KFC which was later taken over by the food giant Hublein ,stood by the core values of the organization ,even when he was no more its owner by vehemently opposing the new managements proposed move to save a few dollars by using water for the preparation of gravy instead of milk27. Some of the recent unilateral decisions of multi national banks operating in India like raising the minimum quarterly balance customers should hold to avoid levy of penalty, charging customers for duplicate statement of accounts, making for not so elite customers, seriously dented their image and credibility.
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markets

used to be ten years ago26 and have to come out with strategies that take into account the

anywhere banking out of reach

resorting to unethical methods for recovery of dues have

Rama Bijapurkar, We are like that only :Understanding the logic of consumer India,(New Delhi: Penguin Portfolio,2007) 27 Basch Michael.D, Customer Culture,pp54-55

6.3. Adopt customer-defined service standards- A majority of service providers fix their own norms and standards. While it is certainly better than having no standards, it is appalling that customers who are the purpose of their business are not taken into confidence while finalizing the standards. Those standards which are company defined in all probability enhance the operational efficiency of the service provider. But are they a true reflection of customers expectations? How many customers want to be greeted by an answering machine when they call up their bank or insurance company? As observed by Zeithmal et al
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Many firms create standards and policies to suit their own needs that

are so counter to the wishes of customers that the companies endanger their customer relationships. Are they working for themselves or customers? Unless firms come out of this service myopia they will not be able to provide delightful service experience to their customers, which is very much essential to forge strong bonds with customers. 6.4. Empower front-line employees-It is the employees in general and front-line employees in particular who deliver the service to customers. A well designed service, unless delivered properly is not going to enthrall the customers. Front line employees are the marketing and operations people rolled into one. None can promote the service more effectively than the employees who perform boundary- spanning roles29. If they are proactive and take decisions on the spot resulting in quick recovery, customers will not fail to notice them. The amount of favorable WOM publicity a satisfied customer generates is invaluable for the service organization. Any goof-ups by the employees, lack of enthusiasm, lukewarm response to customers requests also will not go unnoticed and lead to negative WOM which spreads rapidly like a wild fire. Zeithmal et al highlight the importance of customer-contact service employees as under: 30 They are the service They are the organization in the customers eyes They are the brand They are the marketers

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Zeithmal et.al, Services Marketing: Integrating Customer Focus across the firm,p.298 Hoffman Douglas.K and Bateson John E.G. Essentials of Services Marketing: Concepts ,Strategies and Cases(Orlando, Florida: Harcourt College Publishers,2002,second edition),pp 248-256 30 Zeithmal et.al, Services Marketing: Integrating Customer Focus across the firm,p.364

It is a well established fact that customer satisfaction can not be achieved with out employee satisfaction. Heads of service firms therefore have to manage their human resources with the same care and attention as they manage their personal finances. Recruitment, training and performance appraisal are all specialized activities to be handled by professionals. What the top management should ensure is encourage employees to take on the spot decisions and reward such behavior which will make the employees more confident and responsible, apart from cultivating a sense of ownership among them. Progressive organizations like Tesco performance levels soar enfranchise31 their employees whose to new heights year after year, ,by sharing their profits

with them . They have a scheme named Shares in Success under which more than 200000 employees ranging from check out workers to Stores managers are all set to be allotted companys shares worth a whopping sum of 98 million pounds in bonuses during the current financial year.32 Such practices will go a long way in motivating the employees to higher levels of performance and sustaining the customer-centric orientation through out the organization.

6.5. Build up long-term relationships with customers and other stake holders Instead of seeking more and more new customers which is a transactional approach, organizations benefit more by building up stronger bonds with existing customers by retaining them. This is the essence of relationship marketing. It is common knowledge that it costs much more for an organization (as much as five times in some cases) to develop a new customer to offset the volume loss because of an existing customer defection to a competitor. Some of the benefits of building up long term relationships with customers are:33
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Empowerment coupled with a performance based compensation(See Hoffman and Bateson, Essentials of services Marketing,p259) 32 http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article6361075.ece 33 Hoffman and Bateson, Essentials of services Marketing, pp 391-393

1. Repeat purchases throughout customers life time 2. Customers willingness to pay a premium for reduced perceived risk (a well established relationship allays the fear of un-known and reduces customers risk) 3. Reduced operating costs as customers are familiar with the firms policies, procedures and processes 4. Referrals Satisfied customers often refer businesses to their friends and family members and their positive WOM publicity helps generate new business for service providers. It is therefore very important for marketers of services to maintain long lasting relations with their customers, who apart from contributing to their profits also provide assured business during times of recession, when seeking new customers becomes more and more difficult. Following are some suggested strategies for customer retention34 1. Never lose sight of the purpose of your business-Processing customers like raw materials on an assembly line and being rude to them is incredibly short sighted. Maintaining the proper perspective calls for a customer-centric orientation and a positive service attitude. 2. Stay in touch with customers-Socializing with customers in between service encounters by sending greeting cards, gift vouchers etc is an effective tool for building long term relationships. 3. Build relationships through mutual trust and confidence-This requires high degree of professional integrity, honesty and reliability on the part of the service provider. 4. Involve customer in the service delivery process-Customer as a co-producer provides an opportunity to the service provider to fine tune the service delivery to maximize customer satisfaction and minimize the cognitive dissonance. 5. Provide required training Customers who receive detailed instructions from the service provider about the usage of equipment/technology (ATM, Internet banking etc) required for delivering the service are usually more satisfied than those who have to fend for themselves and are more likely to defect.
34

Ibid,pp394-397

6. Do not ever avoid customers-The last thing a customer expects from a service provider is being cold shouldered when he (customer) is faced with a problem and desperately needs some help/advice from the service provider. Such a short sighted behavior on the part of the service firm will prompt the customers to seek new avenues. 7. Walk that extra mile-It is not the stated needs alone that need to be met. A service provider who takes the pains to meet the unstated or implied needs by his proactive approach will always be remembered by a customer as opposed to someone who merely complies with the technical aspects of service delivery. All the above tactics reiterate the importance of customer-centric approach for building long lasting relationships.

7.Areas for further research


While significant research has already been done on the customer-centric approach and innovation management of global organizations, research on Indian companies in the following areas will enrich the available knowledge base. 1. Relationship between leadership style of CEOs/Promoters and the degree of customercentricism of organizations 2. Role of suppliers and channel members in propagating the customer-centric philosophy of organizations 3. Relationship between customer-centricism and the organizations i.e. state owned, private, cooperatives etc. ownership pattern of the

Conclusion
It is imperative for marketers of services to become customer-centric for staying ahead of competition and occupying a prominent position in the market. Companies with a customers and never long term perspective who always stay connected with

compromise on their strong fundamental values enjoy a better chance of survival and consequent success .World class organizations like FedEx, Singapore Airlines, IBM, Tesco, GCMMF and many others have demonstrated time and again the virtues of being customer-centric. A culture that facilitates innovations at regular intervals helps organizations stay committed to their customer-centric philosophy. People at the top have a well defined role to play in ushering in customer-centric culture and making

innovations a way of life by providing the required inspiration and leadership to their teams. Without this organizations can not hope to have a cutting-edge over the competitors and sustain their initial gains. Adopting customer defined standards, careful nurturing of human resources and building up strong bonds of a permanent nature with customers fortify the organizations against all vagaries of market for whom winning at the market place is a predictable outcome and not a serendipitous act. To conclude, there can be no better strategy for organizations to fight the current economic slow down than adopting customer-centricism and innovation as the twin engines to sustain their growth and profitability during good times and bad times and stay ahead of others struggling to remain afloat. --------------------------------------