If your strategy isn’t right, the best execution in the world won’t get you where you need to go.
In any strategy that involves customers (which encompasses nearly every strategy created by virtually any department within the organization), one major pitfall is making decisions from a single perspective. It’s like a hiker planning a route up the mountain from his or her current vantage point. From that particular vantage point, the solution might seem clear.
But what might they see if they get in a helicopter and fly around the mountain? Perhaps they'll discover a totally new path, or... perhaps discover that they've chosen the wrong mountain.
Inside-out strategy is created from the company perspective. Who we are, what we do, what we're great at, who's our target customer. While this is the most common approach, the cons often outweigh the pros. You’re a hammer in search of a nail, fueled by the hope of “if we build it they will come.”
Conversely, an outside-in perspective starts with the customer problem to be solved, and ideally how they should feel when they do business with you (since emotion drives purchase and loyalty in nearly every sector). Then work your way backwards into your business model and product/experience design.
The third option is “both/and” for existing businesses: start with your capabilities and project outward to define the customer outcomes (tangible and emotional) among which priority customers. Then flip to outside-in to define the ideal future-state experience that delivers those outcomes, and identify the gaps between your current-state and future-state experiences. Lastly, design your strategy to close the gaps.
For example: You might say, we provide tools and resources that empower our customers to (x). That's inside-out thinking, starting with yourself. The resulting outcome is that customers feel more in control. Control is an emotional outcome that resonates with customers who feel confident in themselves and their own abilities, but just need some help in doing (x) easier and faster. (Contrast that with customers who lack experience and would rather outsource, which would deliver a sense of freedom -- being unburdened -- and confidence in the vendor. That mindset requires a totally different business model).
So... given our customers' need for control, what is the future-state experience that is best suited to delivering on that emotion? We know we can deliver part of it (since we already offer tools and resources) but what else do these customers need from us? That's outside-in thinking and requires exercising your empathy muscle. Make sense?
Toggling between what you do well and what customers really want from their vantage points (outcomes, not features and benefits) will help you land on the best answer.
In a similar fashion, we can rely too much on insights that emerge from data & analytics, allowing strategy to emerge in a bottoms-up fashion. I believe we've over-rotated to a dependence on analytics; not saying it's not important, mind you -- we now have an incredible wealth of data at our fingertips that enable us to pinpoint target and personalize experiences. However, we've lost the view of the forest for the trees. Focusing solely on differences and nuances can drive us down into rabbit holes, reinforce silos and spread resources way too thin.
The top-down view is the more traditional approach of brand and business strategy -- finding the common denominators instead of the differences to identify your strategic territory to own as a brand. You can't be all things to all people… you can't design an infinite number of variations of products and experiences. What is your frame of reference? What is your emotional territory that you'll own and nurture over time? I would argue that owning an emotion or a need state is the most effective kind of territory to own, simply because emotions don't change like the wind. Human nature is pretty stable. Apple, Nike, Salesforce, AirBnB, FedEx, Amazon Web Services and too many others to mention have built their businesses on one or more core need states in our Customer Archetype framework.
So, the top-down view finds the common denominator and defines a clear target for the organization to enable alignment and momentum towards shared goals. The bottom-up view operates within this container to better understand priority customers and their behaviors, and enable personalization and cost-appropriate service levels.
A micro-perspective might look at specific touchpoints or customer interactions. A macro-perspective recognizes that these touchpoints and interactions are strung together to accomplish a specific customer outcome or objective. While we often need to repair touchpoints -- for example, creating a mobile app that streamlines the process of hotel check-in -- a sole focus on touchpoints can be enormously misleading. Customers can be very satisfied with one particular interaction but miserably upset at the inability to easily achieve an outcome.
When I called my cable service provider for the third time in an attempt to get my service repaired, I was asked to rate my satisfaction with this particular call. I was delighted with the agent, who was friendly and very helpful. But I was angry at the fact that I had 3 lovely interactions that never resulted in repairing my service. We should all be focused on measuring the macro, not just the micro. The challenge comes when different departments own various touchpoints within a single journey from the customer's vantage point. This is why macro-focused (and outside-in) processes like journey mapping can be so powerful; journey mapping enables various departments to understand their impacts on the customer experience and on other departments.
Pulling it all together
The most important thing to remember when exploring multiple vantage points is to define the "connective tissue" in the strategy that knits all these opposites together.
The single biggest omission in nearly all brand strategies is the lack of clearly defined parameters for the experience required to deliver on the promise. The entire organization (bottoms up, inside-out) must have clear guidelines on how to operationalize the top-down, outside-in bulls-eye. I guarantee no one knows what to do with fuzzy "personality traits" and won't take marketers seriously if that's what you hand over.
The single biggest omission in various departmental strategies (IT, digital, service, product, etc) is the lack of connection to a clearly defined customer outcome that every other department is also aiming for. I call it "getting all the wood behind one arrow:" ensuring that all initiatives and resources are aligned against a shared customer outcome, which compounds their impacts over time.
The biggest flaws in customer segments that emerge from your customer data is the lack of "why" to explain behavior, and also the shared psychographic parameters that can (a) simplify your personas and (b) enable creation of products, services and experiences to meet their common need instead of spreading your resources too thin across numerous segments. Find the intersection between your "why's" and psychographics with the interesting nuances and distinct differences you find in your data.
Dear reader, does this all make sense? What are the challenges to 360-degree strategy from your perspectives?
Yes, it's been a while since I posted here. After nearly 3 years at Forrester (serving as CX Principal and B2B Sector Lead) I decided to revisit my strong preference to run my own business. Enter Farther, which is focused on outcome-based coaching to help companies drive growth through customer centricity. I've been posting on my Farther website, but I've lost all the true blogging functionality there and of course you, my long-time blogging friends. So... I'm back.