Guest Blogger Nilofer Merchant: How Collaboration Improves the Customer Experience

Customer Engagement
Customer Experience
Have you recently called a company to resolve an issue, only to get conflicting answers as they pass you from one department to another? This customer experience is an "external" sign of an "internal" dysfunction.

Have you recently called a company to resolve an issue, only to get conflicting answers as they pass you from one department to another? In the past few weeks I've had that experience with Comcast, American Airlines, and Citibank. And the sad part is that I'm not alone. You've probably had something similar.

The customer experience that companies like these offers is an "external" sign of an "internal" dysfunction. Specifically:

  • By passing the buck, the company is saying, "We work in silos."
  • By not taking care of the problem, they are saying, "We don't know what matters here."
  • By not taking customers' feedback as input, they're saying "We don't innovate based on what customers tell us."

Without ever stepping inside the florescent-lit halls of these companies, you and I already know what it's like to work there. It's not a collaborative culture. And, let me describe what I mean by collaboration. Collaboration is about working together towards a shared goal. Notice the co*labor root word as part of collaboration -- it will be work. And a shared goal implies aspiration. To do collaboration then means(a) knowing the problem, (b) dealing with the tough issues, and (c) enabling the entire organization to have a clear understanding of what matters so they can aim the multitudes and parts of the business in that direction.

To collaborate towards better business outcomes is to work across silos, know what matters, and take the best input from anywhere.

Let me share some examples of companies doing great customer experience in the marketplace as a way of showing collaboration in work outside the company walls.

Dell. Dell created IdeaStorm several years ago, to figure out what to build. The company asked its customers to post ideas, comment on each other's ideas, to prioritize those ideas, and then to vote so that it could make products customers want. IdeaStorm reflects the best thinking for how to have an ongoing conversation for what customers want. Companies like Threadless and others have founded entire companies on this new way to interact with customers. The business benefit is that inventory moves, missed efforts are eliminated, and sales increase.

McAfee. McAfee Maniacs is a program that allows customers to help one another with technical problems online. It started many years ago, and in 2008 the company reported that 70 percent of its support volume is handled via responsive, peer-to-peer relationships.

This infusion of social relationships into the services business makes McAfee more competitive to its peers for two reasons. One, it immediately lowers the cost of doing business, thus freeing up dollars to invest towards innovative new moves. Two, customers stay more loyal to a company they have helped and there are several good case studies that prove that point. In an industry where churn can cost you several points of margin, McAfee's financial results show the bottom line.

Tibco. Greg the Architect is a very well known animation series, if you belong to the business integration or SOA community. Rather than spend dollars telling customers why Tibco was better than some of its bigger competitors, like IBM, it simply created an inexpensive story that customers came to love, and, more important, share. Customers started submitting storylines, and the experience was shaped by the community.

These three examples illustrate us how companies can co-create a better customer experience. For these three companies and many like them, the customer experience is no longer being shaped by the hard, concrete walls of a corporate structure, but in interaction with their customers. Some people have started to call this trend "social business" or "enterprise 2.0" or "transparent organizations" to try and capture this shift. Regardless of the name, this trend will continue: Companies will continue to work in this more permeable way with customers because it benefits the bottom line. These are external signs of marketplace collaboration.

How does this tie back to collaboration within companies? Quite simply, what is happening outside our company has to be managed within our company. We will be communicating, customizing, and co-creating products and we need to find a way to do that effectively. The walls around our company are growing more permeable. The companies that know how to take in new insights, to work across its own silos, and to make decisions close to the point of customer interaction, those companies are going to win. The companies that can do collaboration within their own halls will be more open to the next winning idea, more nimble in responding to market moves, more innovative to figure out what to create next. That's the value of collaboration to every business: in it's outcomes.

Companies will need to embed collaboration systemically rather than topically -- in their people, systems, and cultures. Specific ways to create better business outcomes means collaborating across organizations.

+ + + + + +

About the Author: Nilofer Merchant is founder and CEO of Rubicon Inc., and author of The New How: Creating Business Solutions Through Collaborative Strategy