#7 Let empathy rule
Good strategy starts and ends with the customer. You must deeply understand the customers you serve. Bring customers in to get feedback and co-create your future strategy. Or even better, get out there with customers in the real world to uncover the unmet needs that they are not able to articulate themselves. Seeing and experiencing the world as your customers requires empathy.
Real strategy puts customers first.
As companies grow, so does the confusion about who to serve. While some companies become trapped in serving the inner logic of organisational bureaucracy, other companies design strategy to maximise shareholder wealth. Both logics are flawed. Evidence suggests that neither serving the system nor the shareholders are strong predictors of long-term success. The only valid purpose of a business is to create and keep customers. And if you do that well, value will flow.
Henry Ford famously said that if he had asked people what they wanted, they would have said faster horses. He was most likely right. Experience shows that customers are rarely capable of expressing their wants and needs in a precise and articulate way. That is why we need a better approach. To understand deep-seated needs, we need to empathise with customers.
Gaining empathy with customers in strategy work has two major implications. Firstly, you must start by becoming aware of your own preconceived ideas and setting aside your own assumptions. If you are not self-aware, you will never manage to empathise. Secondly, you must walk a mile in your customers’ shoes to understand their world. This means getting close to what your customers see, hear, think and feel – and making sense of it.
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What jobs are customers trying to get done? What frustrates them about current solutions in the market? What delights them when getting the job done? Listening, observing and asking curious questions will help you get closer to the answer. And by truly understanding customers, we will be able to uncover unmet needs and build actionable insights about distinct customer segments.
While understanding customer needs builds a strong foundation for generating better strategic options, putting customers first should be a pervasive mindset across all phases of strategy design. Staged in the right manner, involving customers in co-creating options will pay off. Unleash creativity with the customer in a systematic manner. And when options have been designed and fast prototypes have been crafted, it is time to get out of the office to get feedback. It is unlikely that a strategic option will survive the first contact with a customer. That is why you must make sure to design the strategy process in a way so that customer feedback is captured, leveraged and integrated systematically in the choice-making process.
Conventional strategy work puts a premium on analysis of big data. But if you challenge conventions and design strategy based on thick data about customer needs, you will improve your ability to make great strategic choices.
Top management thinker Clayton Christensen expertly advises on the value of gaining empathy for customers in this video about milkshakes:
Do we focus on maximising short-term shareholder value? Or do we focus on long-term customer value creation and satisfaction?
Do we design strategy based on assumptions about what customers really want? Or do we build deep insights to uncover unmet needs and differences across segments?
Do we develop strategic options without inviting customers in? Or do we get out of the building to gain feedback from real customers on strategy prototypes?
Implement Consulting Group is rewriting the strategy playbook. We do this by proposing dogmas for creating better strategies that are more fit for humans and fit for the future.
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Article in Danish: In 2016, Implement and Oxford University set out to map common denominators for success and failure in large European IT projects.
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