Presentation given in London at the Leading Design Conference, held 24-26 October 2016 at the Barbican Centre.
CX IS THE CEO’S JOB
Leading Design, London
23 October 2016
“It is only through enforced standardization
of methods, enforced adoption of the best
implements and working conditions, and
enforced cooperation that this faster work
can be assured. And the duty of enforcing
the adoption of standards and enforcing this
cooperation rests with management alone.”
IF I’D ASKED PEOPLE
WHAT THEY WANTED,
THEY WOULD HAVE TOLD ME
IF THERE IS ANY ONE SECRET
OF SUCCESS, IT LIES IN THE
ABILITY TO GET THE OTHER
PERSON’S POINT OF VIEW
AND SEE THINGS FROM THAT
PERSON’S ANGLE AS WELL
AS FROM YOUR OWN.
The opening up of new markets and the organizational
development from the craft shop and factory to such
concerns as US Steel illustrate the process of industrial
mutation that incessantly revolutionizes the economic
structure from within, incessantly destroying the old
one, incessantly creating a new one ... [The process]
must be seen in its role in the perennial gale of creative
destruction; it cannot be understood on the
hypothesis that there is a perennial lull.
Capitalism, Socialism and Democracy
BECAUSE THE PURPOSE OF BUSINESS
IS TO CREATE A CUSTOMER,
THE BUSINESS ENTERPRISE HAS TWO –
AND ONLY TWO – BASIC FUNCTIONS:
MARKETING AND INNOVATION.
MARKETING AND INNOVATION
ALL THE REST ARE COSTS.
A COMPANY'S PRIMARY RESPONSIBILITY
IS TO SERVE ITS CUSTOMERS, TO
PROVIDE THE GOODS OR SERVICES
WHICH THE COMPANY EXISTS TO
PRODUCE. PROFIT IS NOT THE PRIMARY
GOAL BUT RATHER AN ESSENTIAL
CONDITION FOR THE COMPANY'S
PRECISELY SPECIFY VALUE BY SPECIFIC PRODUCT,
IDENTIFY THE VALUE STREAM FOR EACH PRODUCT,
MAKE VALUE FLOW WITHOUT INTERRUPTIONS,
LET THE CUSTOMER PULL VALUE FROM THE PRODUCER,
AND PURSUE PERFECTION.
Womack, James P.; Jones, Daniel T. (2010-11-23). Lean Thinking (Kindle Locations 115-117). Simon & Schuster, Inc.. Kindle Edition.
BIG COMPANIES ARE FAILING FASTER THAN EVER
CEOS ARE GETTING PAID MORE THAN EVER
YET CEO TENURES ARE SHORTER & INFLUENCE IS QUESTIONABLE
GETTING PAID MORE
TO FAIL MORE
TALKING TO THEIR
THAN THEIR NEXT
“[M]ost companies with a
practiced discipline of
listening to their best
customers and identifying
new products that promise
greater profitability and
growth are rarely able to
build a case for investing in
disruptive technologies until
it is too late.”
The Innovator’s Dilemma
THE CEO’S WIFE/KIDS
“I keep a lot of kids around me and ask them questions and peek around
the corner when they think I'm not listening. My master plan was I had a
lot of kids. I have six kids. Three girls that are six, a 15-year-old, 18-year-
old and 22-year-old. I have the perfect research team in my house."
“I actually think I'm going good,
I have the biggest crowds.”
FOMO LEADS TO DALLIANCES NOT MARRIAGES
THE CEO WASN’T
IN THE ROOM
THE LONG TERM TREND
GATHERING & INSIGHT
DEVELOPMENT IS TO
GET FARTHER AWAY
FROM ACTUAL PEOPLE.
CEOS TEND TO
A STRATEGY IS A
PLAN FOR A
WITHIN A SET OF
RESEARCH & INSIGHTS
THEY ORDER TRADITIONAL
RESEARCH, AND STAY AT A
DISTANCE FROM REAL PEOPLE.
“THE DATA WILL TELL US
WHAT TO DO.”
WE DO THINGS WE
WELL, IS IT
THERE’S ALWAYS AN APPLE SLIDE
WON’T LEAVE AMAZON OUT, EITHER.
INDUSTRY OUTSIDERS DRIVE DISRUPTION
CREATIVE DESTRUCTION 2.0
The life span of a corporation is determined by
balancing three management imperatives:
1) running operations effectively
2) creating new businesses which meet customer
3) shedding business that once might have been
core but now no longer meet company standards
for growth and return.
SO HOW DO CEOS
IT’S NOT EASY - AND MAYBE IT’S NOT FOR EVERYONE
Customer-Centric Org Charts Aren’t Right for Every Company, HBR, July 1, 2015
SHIFTS TO EXPLORE
The Business Model Canvas
Designed by: Date: Version:
designed by: Business Model Foundry AG
The makers of Business Model Generation and Strategyzer
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What are the most important costs inherent in our business model?
Which Key Resources are most expensive?
Which Key Activities are most expensive?
is your business more
Cost Driven (leanest cost structure, low price value proposition, maximum automation, extensive outsourcing)
Value Driven (focused on value creation, premium value proposition)
Fixed Costs (salaries, rents, utilities)
Economies of scale
Economies of scope
Through which Channels do our Customer Segments
want to be reached?
How are we reaching them now?
How are our Channels integrated?
Which ones work best?
Which ones are most cost-efﬁcient?
How are we integrating them with customer routines?
How do we raise awareness about our company’s products and services?
How do we help customers evaluate our organization’s Value Proposition?
How do we allow customers to purchase speciﬁc products and services?
How do we deliver a Value Proposition to customers?
5. After sales
How do we provide post-purchase customer support?
For what value are our customers really willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each Revenue Stream contribute to overall revenues?
For whom are we creating value?
Who are our most important customers?
What type of relationship does each of our
Customer Segments expect us to establish
and maintain with them?
Which ones have we established?
How are they integrated with the rest of our
How costly are they?
Dedicated Personal Assistance
What Key Activities do our Value Propositions require?
Our Distribution Channels?
What Key Resources do our Value Propositions require?
Our Distribution Channels? Customer Relationships?
types of resources
Intellectual (brand patents, copyrights, data)
Who are our Key Partners?
Who are our key suppliers?
Which Key Resources are we acquairing from partners?
Which Key Activities do partners perform?
motivations for partnerships
Optimization and economy
Reduction of risk and uncertainty
Acquisition of particular resources and activities
What value do we deliver to the customer?
Which one of our customer’s problems are we
helping to solve?
What bundles of products and services are we
offering to each Customer Segment?
Which customer needs are we satisfying?
“Getting the Job Done”
Product feature dependent
What behavior is your organization engaged in that
aligns with your purpose?
YOUR CORE BELIEFS
About your business model, how you create value,
and what your assets are.
What’s the one belief you hold, that if untrue,
risks destroying your company?
GET TO KNOW YOUR
The people who are hacking their own solutions
or turning to unexpected players to solve their problems.
Develop opportunity spaces that
meet emerging customer needs.
COMMIT TO CHANGE
Provide management air cover to protect your teams,
and enlist ground support from those
who will carry out the change.
Shed product lines and lines of business that don’t
meet your objectives and align with your mission.
THE PATH TO GROWTH
market fit &
CEOS SHOULD BE ABLE TO EXPLAIN WHAT CREATES VALUE FOR CUSTOMERS
➤ They should develop hypotheses that:
➤ Help their organizations make decisions
➤ Help their organizations create value for our customers
➤ Help their organizations develop empathy for people so deep we can
anticipate solutions to problems they can’t yet express
COOL STORY, BRO.
CEOS NEED TO UNDERSTAND
PEOPLE AND BEHAVIOR
TO MAKE BETTER PREDICTIONS
AND MEASURE OUTCOMES MORE
THANKS FOR LISTENING.