Customer-centricity is going to be one of the industry buzzwords of 2018. Agile startup companies that challenge large incumbent companies by designing their entire strategy around the needs of the customer are redefining several industries – banking in particular. But customer-centricity is not a new concept in our part of the world.
In the 1980s Jan Carlzon, the former CEO of Scandinavian Airlines System (SAS), transformed the airline by focusing on the needs of the customer. He coined a phrase: ‘The Moment of Truth’ to describe the exact moment that a customer came into contact with a SAS employee. Each time there was a moment of truth was an opportunity for SAS to prove their value to the customer.
In fact, what Carlzon achieved over 30 years ago was to place the needs of the customer at the heart of the business. He turned customer service into an obsession with the entire organisation. Carlzon estimated back then that his company had 50 million opportunities per year to prove their value to the customer – 50 million moments of truth. Carlzon never stopped telling his employees that the company lives or dies based on these moments of truth.
Modern thinking on managing the customer experience is remarkably similar to the model Carlzon described decades ago, however, there are two important changes that emphasise the importance of the moment of truth even further:
1. Omnichannel: Customers today have many more opportunities to interact with brands. They can call, Tweet, leave an Instagram comment, or write an online review. The number of communication channels today between a customer and airline has expanded exponentially since the 1980s, and yet customers still expect their interaction to be handled well – however they send a message.
2. Customer Journey: Customers today no longer communicate with an airline just to book tickets or ask about flight information. They might use social channels to ask about the in-flight menu, or which movies are available, or how they can get a job with the airline. The interactions between customers and airlines today are not always transactional, they form part of an ongoing relationship and therefore need to be managed and taken seriously, but they might not always involve the purchase of a ticket. The moment of truth might be located at any point in the customer journey and does not specifically need to be a customer-employee interaction – it could be a customer-customer interaction on a social network.
SAS clearly continues to think innovatively about how they interact with customers. I saw news recently that they are offering students the chance to work as cabin crew, provided they can prove they have at least two years work experience in a service-related job, and meet the basic safety requirements. This is a clever way to locate extra resource that can be used during typically busy periods, such as the Christmas holiday season and summer, which is exactly when students have time away from their universities.
The leadership at SAS have long known that placing the customer at the heart of the business is essential for success and future growth, but the customer experience landscape has changed dramatically in just the past five years. All companies, no matter how customer focused, need to be aware that customer expectations are now sometimes moving faster than corporate strategy. It takes courage to think of what customers will want in future, but this is what modern airlines need to be doing if they want to succeed in the coming decade.