It’s about the customer, stupid.
Companies that aren’t putting solutions to customer concerns at the top of their to-do lists risk losing ground to competitors. That might not be a surprising statement, but new research suggests that CFOs are flat-out obsessed with the idea.
In a survey of 250 finance chiefs by Forrester Consulting, 89% of the participants said they are prioritizing improvements to customer experience this year or will do so next year. An identical percentage said they are addressing rising customer expectations this year or will be next year.
Forrester identified 36% of the participants’ organizations as “customer-obsessed leaders.” It defined them as prioritizing customer-focused initiatives this year and having experienced increased customer acquisition, retention, and satisfaction.
Leaders were 39% more likely than “followers” to report year-over-year revenue increases of 15% or more in their most recent fiscal year. Also, 90% of leaders reported increased cash flow, compared with 60% of followers.
Data analysis is, of course, a key to gaining insights on customers. Unfortunately, survey respondents reported challenges that impede them in that mission. Roughly a third of CFOs pointed to a lack of data integration (35%) or to organizational silos that make it difficult to get needed insights from other business stakeholders (37%). Further, about one in five (22%) of the participants said they are hampered by organization-wide inconsistency in the methods used to calculate and assess KPIs.
- Executive engagement. Evaluate existing interaction and collaboration with executive peers in order to participate in and help lead “customer obsession.” Among the leader companies, 85% are changing their management culture to rely more on data-driven decisions, their CFOs said, compared with 70% of followers.
- Strategic contribution: Rethink financial tracking and analytics capabilities to include insights and models that support and drive customer obsession.
- Data strategy: Transition from traditional technology investments that are based on lower total cost of ownership, to investments that drive topline results of customer obsession.
- Data sourcing: Realize that harvesting data from trusted sources — such as private, partner, proprietary, and public data — is central to moving from customer strategies that are based on perception to those that are based on fact.
- Data and analytic capabilities: Prioritize data and insights that better identify and predict opportunities, threats, and weaknesses of customer strategies in the market and the competition.
All of the survey respondents’ companies had annual revenue of at least $150 million in their most recent fiscal year. Forrester conducted the study in April 2017.