As early as the 1990s, the positive relationship between customer centricity (customer excellence) and business success was demonstrated empirically in success-factor research. Despite all the confusion, customer excellence has steadily gained importance in recent years — not least because several studies have shown that organisations with a high level of customer excellence have, on average, 3 to 5% higher profitability. Given the increasing interchangeability of offerings, brands and experiences, and the ever-faster imitation of innovations by competitors, the only option left is a stronger orientation towards the customer.
With the Customer Centricity Canvas, you can assess the strengths and weaknesses of your company's customer excellence and systematically define measures to improve them.
If you look at the first attempts at definition, it is striking that customer excellence was set in opposition to an offering orientation. At first glance this sounds plausible (e.g. the automotive industry, which in its CRM systems still uses the car, and not the customer, as the identifying element), but it falls short, because there are certainly successful organisations that focus on the offering and could nevertheless be customer-centric. This definitional approach also lacks a clearly delineated management model. The offering is the insufficient core of the benefit for the customer and, with regard to customer excellence, can only be delineated philosophically. The degree of customer excellence also always has an effect on an organisation's offering.
In the following years, customer excellence was understood as a universal guiding star that, unreached, drives all life in the organisation. Sounds good, but is not very helpful in the day-to-day work of a management team. The fact that the definition of customer excellence changed comprehensively again and again over time has also led to everyone understanding something different by customer excellence. The absence of a model with different elements and relationships makes it impossible for many employees to understand how customer-centric their own organisation actually is. Other works on customer excellence see their task primarily in establishing a customer-focused organisational culture. An organisation's culture is an important building block for success. But, as the name suggests, customer centricity is oriented towards the customer and (again!) not only towards the organisation. Most English-language authors equate customer excellence with the customer experience. This offers no recognisable added value for management. Customer experience is an important element of customer excellence, but only one. Other authors reduce customer excellence to the use of customer insights. This understanding builds on a knowledge orientation. From the mid-1990s, a knowledge-based view of organisations became established, and the primacy of knowledge and intellectual capital as an organisation's most important potential was emphasised. Consequently, the knowledge and learning ability of employees are the primary source of competitive advantage and the basis of an organisation's ability to survive. A knowledge-based organisation transfers its existing knowledge and skills into services that allow it to better master its challenges. Applied to customer management, the term 'market-based learning' was introduced. As with culture, focusing solely on an organisation's knowledge development falls short. Understanding customer centricity as a craft demonstrates, as with any craft, the high importance of knowledge. But there are other elements that need to be taken into account. It remains to be noted that, on the basis of the knowledge orientation, customer information is an important building block of customer excellence. Merely obtaining customer information is not sufficient for improving customer excellence. There are still many organisations that do not conduct high-quality customer surveys. It turns out — and this is shared with great frustration by many market researchers and data analysts in most conversations — that customer information is often not used for decisions. Customer excellence does not stop at the production of insights about the customer; rather, these must then be used for as many decisions in the organisation as possible.
In addition, some authors see customer excellence as equivalent to customer relationship management. This too yields no real added value, and the sense of using two terms for an identical management model is not comprehensible. There are also approaches that try to define customer centricity through several terms, e.g. total experience, customer obsession or insight engine. The selection of terms appears arbitrary and the terminology partly intimidating. Who wants to be obsessed?
At first glance, there are thus numerous different understandings of the term customer excellence. Most of the time, customer excellence is defined far too narrowly and is therefore hardly distinguishable from terms such as customer data management, customer experience management or customer relationship management. With the more complex attempts at definition, the focus is more on driving the proverbial new pig through the village than on establishing an effective management model. Customer excellence thus runs the risk of becoming, like digitalisation, a hollow word that no one understands but that attracts moths like the light.
Customer excellence consists of four dimensions and pursues the goal of growth and profit increases through better adaptation to changes in customers' purchasing behaviour. No more, but no less.
