The great company does two things very well in the 21st century. Conversely, companies that do not do both well need to transform themselves with urgency or suffer diminishing profits.
Great companies invest to make innovation a strength
Should we expect non-technology companies to innovate? Yes. Innovation is not the exclusive domain of Silicon Valley geniuses. I would say that if you are in an industry that is not good at innovation, spend now to get that capability and expertise. We have collectively developed the most sophisticated and digitally-armed buyers in the world. We better have an innovation strategy to feed their rapidly-evolving wants and needs.
Company leaders who do not appreciate constant change are poor students of astronomy, biology, and the human race, just to name a few. Everything is changing and disruptive technology is changing everything we know in business. Change is often just another word for innovation or evolving. Innovation is life in the Digital Era.
Great companies build to serve the customer experience
Think about a person you deeply care about and where you can pick up on the slightest signals. Your hawk-like attention allows you to anticipate their wants and needs others simply never detect. Think about how that feels when it happens to you. Someone can just look at you and know what is on your mind. It feels like a superpower. Today’s buyer demands that you have that superpower, but most companies don't.
Companies have heard much about the customer journey and customer experience. Then why are so many so bad at aligning to their customers? I suspect because the customer experience effort asks them to be long-term thinkers and too many business leaders are the loyal practitioners of the myopic. Also, leadership often make the conversation too much about what the marketing and sales teams are doing instead of what the customer requires.
Let’s take a look at where you would place your company and competition on the following chart.
Market-leadership Ability Chart
Group One: Done for
Unable to innovate and without a superior customer experience, your best people have likely left the company. Time to hit the reset button, shut this company down, or sell it off. You are in deep trouble.
Group Two: Groundhog Day
Customers are cheering for you, but feel disappointed. They want to know you are a partner making them look smart for picking your brand. Your front-line people are delivering the same strong customer experience every day, but the portfolio is tired. They have nothing new to talk about. Your portfolio isn’t evolving and you lack innovation skills. If your business is currently okay, enjoy it, because disruption is around the corner. Your loyal customer is already researching other providers. Find an innovation leader (hire from a tech company if you have to) create an innovation team, name an executive sponsor, invest in ideas (two generations deep) and pilot those ideas to market. The clock is ticking and you need to protect your future.
Group Three: Bottleneck
You are innovating, but your go-to-market execution is lacking. Moreover, your company fails to create solid touchpoints which means you lose buyers during the purchasing cycle. You have too many things to sell and a small pipe to get them through. Some symptoms here are; salespeople with uneven subject-matter knowledge, uninspiring content marketing, confused buyers, and channel education issues. This is fixable. Have someone own the customer experience, create a plan, and execute with a customer-first passion. This is change management requiring two to three years for the company to adopt this transformative approach Bonus: with what you learn by getting closer to your customers, your innovations get sharper.
Group Four: Market-leader
It is hard to compete with someone who innovates and delivers a superior customer experience. These are the market-leaders and great companies. Technology and drug companies depend on innovation management. This will be a new set of skills for most non-technology companies. Most will not know how to pollinate ideas, manage cross-functional teams, and bring those ideas to market. The great news for you is that it’s easy to stand out if innovation becomes a center of excellence for you.
Research shows that many companies are bad at customer experience, so it is a point of differentiation for the company that does it well. When it comes to the Internet and social media, customer experiences are shared with millions in real time. Let’s take it one step further. Should we admire our marketing and sales leaders if they are not working together to address the customer’s journey? Even if our company is doing well today, we could be marching to a dead end.
Plot your competition on this chart above. Where are you? Instead of thinking about how big your competitor is or what they want the world to believe (branding), do an objective analysis of these two determinants. Whether your leadership wants to admit it or not, disruptive technologies have placed you in the innovation and customer experience game regardless of your industry. How your company invests in both for the next decade will decide if your company is great or an also-ran.