Why are some leaders afraid to talk to customers even when they’re a big catalyst for innovation?
I recently had the opportunity to meet with a major bank. The discussion involved how to create new financial services for their high net worth clients (a.k.a. people who are way richer than I’ll ever be). I offered my opinion that directly engaging their clients could provide an important stimulus for their ideas. “We can’t talk to our customers,” they replied. “Their relationships are way too important to us.” The real message was this: They were scared of their very own customers. Behind this fear was the concern that loyalty might be jeopardized if they approached their customers with questions about their needs and desires. They were also concerned that their most cherished customers wouldn’t want to take the time to talk to them (e.g., the fear of rejection).
During an organization’s start-up days, it’s much easier to strike up conversations with the market since there’s not much to lose. With only a few customers in the early stage of the game, any open-ended conversation with someone interested in what we’re doing is welcomed with enthusiasm. But the growth of a company can have an inverse relationship on customer focus. Incremental improvements become the focus. And cautious behavior becomes the norm. Makes sense – why mess with a good thing?
But look and the most innovative leaders and companies and you’ll see that they continually engage customers to help them reinvent their offerings and their organizations. And they do so strategically. A different bank, for example, recently created an incubator where early-stage ideas could be seen and worked on by employees only. They recognized that certain ideas simply needed more time in the conceptual oven before they felt baked enough for customer feedback. But they also created a “lab” where they brought in real live customers to test-drive new online banking products. The lab proactively recruited customers who were pre-screened as forward thinkers who were interested in providing input. Using this “back room – front room” model, the bank kept certain ideas away from customers until they were “ready” and then used the lab to gain inputs from the customers that they knew were pre-disposed to “co-creating” the future with them. Through rapid prototyping, the bank was able to bring a mobile banking application to market in just 60 days (versus the typical 12-18 months), and at approximately one-tenth of the cost.
What is often true in human nature is also true of corporate culture: we resist stirring up the status quo. So, the next time the topic of talking to customers comes up, be sure to ask: “What are we most afraid of losing… a customer or a big opportunity for innovation?”
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Foreword by Marshall Goldsmith
