Culture eats digital transformation for breakfast
When you’re responsible for a budget of tens of millions and motivating an entire organisation to embrace digital ways of working, the stakes are ‘organisational life and death’. But culture is the vital ingredient you need to succeed. If culture isn’t truly embedded in the organisation, from top down to bottom up, you will fail.
Most brands today recognise the importance of being ‘match fit’ to compete in today’s digital world. On the face of it, it looks easy: hire a few analysts, management consultants and digital designers and you’re ready to develop products! Wrong.
Recently, I have been collaborating with Abby Thomas, Director of Transformation at British Telecom (BT). Since both Abby and I are Digital Transformation focused, we decided to create a talk about the role ‘culture’ plays in the transformation programme and how it puts customer centricity and staff at the fore to drive success.
Whether you’re a digital agency or a Fortune 500 player, transforming the company culture is the single most important building block to a successful digital transformation. Therefore, in this article we’ll cover what great brands do well with digital transformation, and the pitfalls of getting your people and customer culture wrong.
Why is it so important to put the customer first?
It’s common to distinguish between small and nimble start-ups and larger, more analogue companies. Generally, the larger a company is, the harder they will find it to shift their culture towards truly customer-centric design and digital ways of working. When you have thousands of staff that are alien to customer focused design, how can you change that culture?
Intuit are one of the largest tax software providers in the USA, employing more than 10,000 people. Their product Turbo Tax aims to “improve their customers’ lives”. Traditionally they developed in a ‘waterfall’ (or, ‘write requirements first, build second’, approach). Yet their tiny UX team succeeded in making hundreds of software engineers user focused, and even transformed the entire company culture in the space of just one year.
How did this tiny team that was formed in 2013 do it?
Well they got almost immediate support from their CEO Brad Smith who knew from prior data that “ease of use” was the primary reason customers recommended Intuit. Brad declared: “by 2020 Intuit will be considered one of the most design-driven companies in the world”. So what did Intuit do? They invented their own design thinking model called D4D (design for delight), increased their number of designers by 600% and held quarterly design conferences. They also ran customer panels and got non-UX staff to visit customers at home. D4D gave birth to a new app called SnapTax which replaced Angry Birds as the most downloaded app on iTunes. Users were raving about this new app saying that “it is so easy to do tax returns from the bath tub!”
Sometimes what is perceived to be conventional wisdom, such as running focus groups with prospective customers, can go wrong.
For instance, in the early noughties, Lego sales were down by almost 30% a year. Thinking “outside the box” led Lego into near bankruptcy. Their fashion lines and ‘brickless’ Power Ranger figurines like Galidor stepped too far away from Lego’s roots and core customer wants and needs. Introducing new ‘innovation’ and product lines whilst removing Lego blocks caused sales to plummet and almost wrecked the company.
Why did Lego lose the plot after decades of prior success?
The answer is that Lego ran focus groups but without its core audience. It also ran innovation silos that were disconnected from its core values.
But despite these failures, in 2003 it managed to bounce back once it thought ‘inside the box’, getting closer to its core customers, returning to its core principles and establishing a responsible team charged with going back to its roots. In 2015, Lego overtook Ferrari to become the world’s most powerful brand.
So how did it bounce back so strongly? Firstly, Lego dumped non-core business activities like Lego-Land parks (these were sold to Merlin Entertainment UK). They also halved the number of Lego pieces they produced. They capitalised on channels like the internet and introduced crowd sourcing campaigns where originators of ideas receive a 1% of products net sales. New crowd sourced designs included Back to the Future’s DeLorean Time Machine.
Lego understood that children make up its largest audience and conducted what is said to be the world’s largest ethnographic study of children. This included travelling all over the world and watching kids play on their own or with friends.
This is where customer centric insights were really gained: Lego understood that ninjas were the most popular figurine with boys, who were ultimately concerned with good vs evil. Whilst the boys preferred blocky ninjas, girls were more interested in life detail and realism so Lego Friends was born which is essentially a mirror universe of the world we live in. The girl product featured bakeries, amusement parks, riding camps and even loos.
Bridging the physical and digital world and leveraging newer channels contributed to the success: Lego Life is a social network for children too young for Instagram where they can share their creations and gain likes. Children are not the only audience. Lego also restored engagement with adult and nostalgia fans through Brickworld, a conference that brings fans from all over the world together.
Another factor that made Lego really succeed was their appetite for partnering with other brands and creating new types of entertainment core to its Lego brick product such as the 2017 Lego Batman Movie. This became the best-selling Lego movie of all time. We’d argue that by becoming so focused on their real customers and making friends with other brands from Marvel Universe and Disney, Lego have pivoted their culture towards success.
Since 2016, BT, the UK’s largest telecommunications provider, has used digital innovation to transform the customer experience through the MyBT app, an improved website and better processes and systems in their call centres. Their strategic vision was to offer each customer their channel of choice while ensuring they were catering for widely different demographics, varying degrees of comfort with technology and the need to accommodate ‘digital natives’.
Through persona interviews, UX researchers at BT found that one of the pain-points of older demographics was restarting their home hub router due to the device being out of reach and out of sight. BT implemented a mechanism within the MyBT app that allows users to restart the home hub router from the app itself.
This reboot button became one of the top ten most popular features within the app.
As key managers in the business devoted time weekly to listen to customer calls, new customer centric ideas were born. As part of the transformation programme a key outcome of the research phase was a better understanding of where customers want to stay in control and conduct transactions themselves, versus where they need help. BT took a ‘digital first’ approach and are targeting the ability to conduct 95% of transactions online. Because of this change, alongside more training for contact centre advisors, 66% more customers say that BT is now very or extremely easy to deal with compared to early 2016.
The value of a customer centric approach
The organisational benefits of customer centricity are only part of the success that businesses can draw upon. By designing a new back-office system that was as simple to use as an iPhone and mirrored the content on the website, BT support staff could help customers much faster.
The financial benefit to BT was immediately reinvested in the customer experience. BT have hired more than 2,000 new call centre advisors in the UK to answer customer calls more quickly.
The changes have also been felt by staff. 87% of call centre advisors agreed they would recommend the new systems and processes to a friend, improving staff NPS and their motivation to help customers. If businesses ever needed a better argument for putting customers first, examples like this provide that.
So how can organisations like BT, Lego and Intuit implement a customer centric model and culture?
Getting your brand vision right
Firstly, brands need to recognise where they stand in the market, where they want to be and why they need to go the extra mile from a strategic perspective. It’s not always easy to get the brand strategy right and mergers and acquisitions can be risky.
For instance, prior to 2001, Yahoo founders Jerry Yang and David Filo managed to position Yahoo as the number one gateway for searching the world wide web. Yet Yahoo decided not to capitalise on and improve the customer experience of their core search product and directory. Instead, by 2002 they built or acquired 400 products through numerous acquisitions including an astrology product hotline charging $15 a pop.
Contrast Yahoo with Google, their ex-arch competitor. Google created 10 principles that haven’t changed since 1998.
One of the principles was ‘It’s best to do one thing really, really well’. If only Yahoo would have taken note. When a company knows what it stands for and where it is going, it can focus its people and resources and have clarity in a range of decisions. If leaders eliminate any chaos or confusion at the top, they can remove the amplification of that chaos through the ranks leading to harmony, interdependence and empowerment.
The importance of user-centred design
Convincing colleagues of the value of qualitative research and how it benefits the user experience (UX) is fundamental, and being data driven like Amazon is vital. But unlike what a lot of people think, Amazon undertakes vast qualitative user research (that is not data driven) to understand ‘why’ users feel a particular way and what they think about Amazon before, during and after the sales process.
By simply reading customers emails, Jeff Bezos CEO of Amazon knew that customers were getting annoyed about promotional emails relating to adult products.
Amazon immediately shut down all email marketing related to adult products despite the numbers being positive. Logical user feedback should prevail over masqueraded metrics and sales data.
In 2014, Virgin Atlantic reinvented its flight booking user experience by creating a single page application (SPA) which is an app-like website. Virgin realised that its websites are built on Web 1.0 technology stacks, comprised of UI elements that are a nightmare to navigate on small screens. Similarly, it had large location images and adverts, and paused often while loading pages, therefore frustrating users. But the new SPA product, allowed users to book flights 50% faster than before.
According to Ben Holliday, a UX Designer there is a difference between designing for functional needs and emotional needs. Emotional needs are timeless and less likely to change because of a policy change or an adapted business model whereas functional needs are practical day-to-day things that users need to do.
Many organisations only focus on functional needs without thinking about the ‘bigger picture’, the life stage the user is at (e.g. retiring, newly wed, looking for a new job or even bereaving). A common argument against user-centred design is that it ‘oversimplifies inherently complex solutions, systems, processes, and enterprise-level technology’. What Ben and design agencies like Cyber-Duck say is that the most successful products are fused by both emotional and functional needs.
Successful brands tear down legacy software, create new technology and remove old-fashioned barriers to make the user experience simply work.
One company that has done this really well is Apple with their iOS mobile phone software. The iPhone knows what news you like, reminds you where you parked your car and can predict what you will type next. You can train Siri a voice recognition assistant to know who your family members are, ask it to add things to your calendar and remind you to do things. These features are way beyond simple functions. They create a real emotional bond between you and your phone.
“User needs are about understanding the problem space, not a solution space” Ben Holliday, UX Designer
Culture and human relationships
It’s easy to design a killer website in Photoshop as part of a pitch and get everyone excited about it. But what is very turbulent is the path from pitch to production and delivering a product that actually works for the customer and the back-office business in the long-term.
What made the Virgin Atlantic website so successful was the fact that it wasn’t just designed by a digital team.
The legal, operations and infrastructure teams deeply cared guest experience and were actively involved in the redesign of the processes needed to improve the user experience.
At Cyber-Duck we transformed our own operating model so that we are all totally client focused. After every project we run a Project Retrospective Analysis (PRA) session to learn what worked and what didn’t in our client focused production process — as part of this process, we review any non-conformities (NCs) or opportunities for improvement (OFIs) raised during the design or development lifecycle. The PRA is then informed by a client or retainer survey and subsequent post project meeting to obtain qualitative client input. We then feedback these learnings into bi-monthly company announcement meeting (CAM) where the learnings are presented to the entire organisation.
But creating the right culture for customer centricity is not only about a brand strategy and a focus on the user. Whilst companies like Uber have disrupted transportation and invented new ways of working, an investigative journalism piece by the New York Times claimed that “Uber uses psychological tricks to push Its drivers’ buttons”.
Uber tracks when drivers are short of a particular financial goal and uses ‘income targeting’ where drivers are prompted to increase their goal further by working longer.
Uber also use a ‘forward dispatch’ technique; a driver on a job is prompted about a future passenger pick-up causing a possible ‘override of driver self-control’.
Whether you agree these are dark UX patterns or not, the alleged claims and news about sexual discrimination against multiple woman (according to one ex-employee) at Uber haven’t helped present a rosy culture. When Travis Kalanick, Uber’s CEO took an Uber himself he was challenged by a driver that complained about remuneration on camera. The video footage showed Travis arguing with the driver as opposed to being more empathic. What some organisations miss is a philosophy of why leaders and employees should treat other humans like how they would want to be treated. Without injecting the right type of values, respect and professionalism into human relationships leadership teams can collapse and brands will fail with their quest to be truly customer centric.
Conclusion
There is no better example of customer obsession than Amazon: Jeff Bezos, CEO of Amazon said that he sees customers as invited guests at their party and its the staff’s job to make every aspect of the customer experience better. It is true that Amazon like Uber has also had negative press about its culture. Employees are allegedly meant to compete against each other and articles emerged about staff being penalised for sick days.
Whilst competitiveness is healthy in business there are certain things that companies should not do. I guess no business can ever be perfect but I can’t help admiring Amazon. Every year Jeff Bezos releases a playbook and in 2017 he said the following about customer centricity:
“…There are many advantages to a customer-centric approach, but here’s the big one: customers are always beautifully, wonderfully dissatisfied, even when they report being happy and business is great. Even when they don’t yet know it, customers want something better, and your desire to delight customers will drive you to invent on their behalf. No customer ever asked Amazon to create the Prime membership program, but it sure turns out they wanted it, and I could give you many such examples.”
He finishes off the letter by thanking every single staff member from the heart. I think that this type of obsession of both the customer and the staff is what organisations must put at the core of their digital transformation. Once it is formulated, leaders and managers will be able to sleep well at night.
Note: My colleague Paul recently wrote an article about age inclusive design. Is your culture geared towards senior citizens? Are you transforming the customer experience by capitalising on a growing older demographic? With constraints brands can find new opportunities.
