The Newest C-Suite Role: Chief Customer Officer

A Public Declaration that the Customer Belongs in the Boardroom

The role of Chief Customer Officer is relatively new, an outgrowth of the increasing power and influence of customers. Interest is growing in this position because it puts a public face to the importance of customer service, and signals a public declaration that the customer—because of the rise of social networks and the dissemination of opinion and ideas on the Internet—should be represented in the boardroom.

What is the CCO’s Mission?

A chief customer officer (CCO) is in charge of influencing corporate activities to make sure that the customer’s needs are understood and met by all the members of the organization. The CCO is tasked with making sure that all the divisions of the company: finance, sales, marketing, customer service, etc. appreciate the customer’s needs across the boundaries of those divisions.

According to Jeffrey Henning, founder of the Vovici blog, ”Without a CCO, customer advocacy and action is dispersed and diluted. Marketing worries about the customer as a lead; Sales worries about the customer as a prospect; Service worries about the customer as a problem; but there is nobody to think about the customer holistically as they experience and engage with your brands, your products, and the legions of employees who represent your business on the front lines every day.”

Biggest Challenge: Feedback Lives in Silos

Henning continues: “Sales has its lost-business survey; Service has its follow-up survey; Product Management has its irregular planning survey. In fact, Fortune 500 firms often field hundreds of surveys per year to their major accounts. Fifteen years ago customer data was dispersed throughout the organization, rather than centrally managed; enter the customer relationship management system. Similarly, today, customer feedback is dispersed throughout the organization, with each department collecting what it thinks is important. The Chief Customer Officer needs to centrally coordinate today’s fragmented feedback in order to build tomorrow’s customer-driven, designed and consistent customer experiences.”

Bridging Among Silos

According to Audrey Y. Manring in a Destination CRM article,  the CCO’s job doesn’t match historical hierarchal management models. It bridges among siloed divisions.  Organizations may be, within each silo, instituting customer strategies, embracing new technologies, tapping new sales channels—all aimed directly at the customer from their division’s viewpoint. But without coordinated change, customer centricity is just talk.

Sometimes there’s a moment of recognition that the customer’s needs are not being met. Organizational structures face the challenge of finding a way to amplify the role of the customer across operations, finance, sales, and business development. This may not be possible without an “ambassador” able to cross the boundaries within the organization. Making a decision to focus on customer management and profitability is just an idea. Like any big decision it’s easy to embrace that idea and more difficult to take the steps that will lead to real organizational change.

Breaking the Fear Barrier

Interestingly, this “bridging” role may prove useful in helping companies avoid the “fear barriers” that Tom Rieger writes about in his book Breaking the Fear Barrier.  Without attention, departmental focus can narrow and lead to parochialism (narrow world view and turf protection), territorialism (control within a silo), and empire building (standalone power consolidation). These barriers are costly, inefficient, and demoralizing.

Tearing down these barriers is difficult, but a Chief Customer Officer might be able to head off such a culture with ambassadorial processes and by maintaining a focus on the ultimate mission of the organization: customers.

Who Needs a CCO?

According to customer service thought leader, Jeanne Bliss: “There’s a lot of talk going on now about having a “chief” to own the customer effort. Sounds great, right? Well . . . maybe. Don’t put your money down until you know what you’re buying, how this role can fit in your organization and how hard you have to work to make it a success. This is expensive real estate in terms of commitment, time, people, and changing how people work.”

The Cultures of Large and Small, Established and New

For the startup, or the company that goes into business with a strong customer focus and understanding from launch, things are a bit easier for the CCO.  ”Flat” company hierarchies fare better because they are smaller, more flexible, and accustomed to crossing functions.

For the established, larger company, CCOs face a somewhat daunting mission. Often their main function is to change corporate culture toward improving the customer experience over the long term. This progress may be punctuated by short-term successes, but entrenched attitudes and behaviors are hard to change.

Typical Functions of the CCO

No matter the size of the company, customers are certainly the beneficiaries of the attention of an advocate like a CCO, Typically, the CCO role includes some combination of the following functions:

• Voice of the Customer: What do customers want? What is their current level of satisfaction? What benefits to the customer should the company be leveraging? What does the customer need that you do not have, or that your competitors are offering?
• Whole Company Involvement: Insure that all employees are aware of and engaged in the importance of raising customer satisfaction.
• Persuasion & Cheerleading: Convince other key players of the power of “customer experience differentiation” for the long term. Foster a company culture of customer centricity.
• Analysis: Collect data, interpret data, and demonstrate the economics of the customer experience to all participants.
• Prioritization: Know which issues are most important and triage the execution of programs accordingly.
• Metrics: Uncover insights based on “customer math” in ways not normally seen in typical siloed data analysis.
• Customer Retention and Migration: Understand where and why customers are retained, or lost.
•  Customer Segmentation: Identify the most successful customer relationships, and find ways to deepen that relationship.
• Diplomacy: Bridge corporate hierarchal divisions and entrenched silos that act as barriers to full understanding of the needs of the customer.
• Strategizing: Keep focused on strategy rather than tactical issues. Jeanne Bliss describes the role of CCO as a “Velcro role” because the position tends to attract blame for problems in other departments.

Two Goals, One Umbrella

The role of CCO is a somewhat schizophrenic blend of representing the company to the outside world, and championing the cause of the customer to the company. The job requires significant leadership, diplomacy, and persuasive capabilities. Success depends on having the authority, influence, and budget—along with visible support from leaders.

Bringing both those goals under a single umbrella is the challenge. CCOs speak for the customer within the organization, and become their ombudsman in a possibly resistant internal environment.

Sounds like a job for a super hero!