Chief Customer Officer Strategy: Dispensable Playbook or Most Valuable Player?

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Chief Customer Officer StrategyChief Customer Officer strategy varies widely, with a mix of defense and offense playbooks.

  • Defensive plays in customer experience management (CXM) are in Service, Loyalty programs, Net Promoter System, and closed-loop Voice of the Customer (VoC).
     
  • Offensive plays are in Customer Success, Onboarding, Education, and Operations; Qualitative VoC, Data Mining, and Analytics; Account Management, Journey Mapping and Interaction Design, Personalization and Customer-Centric Marketing, Digital Transformation, and Customer-Centric Culture.

With so many playbook options, let’s explore what makes a dispensable playbook for Chief Customer Officer strategy versus a Most Valuable Player (MVP).

Dispensable Playbook

Short play!1 Some executives view Chief Customer Officer strategy as a a temporary initiative:

  • Outback Steakhouse’s parent company, Bloomin’ Brands, eliminated its CCO2 position in 2021, just two years after establishing it. During that tenure, the CCO’s mandate was to build the company’s digital capabilities. After introducing a new ordering system and mobile app, the CCO was given a golden parachute of $1.6M severance pay. The CCO’s digital team became part of the Marketing department, with the CMO taking on the overall customer strategy and the CTO taking on customer experience technology.3

Out of bounds! Has any C-Suite role been a two-year initiative? Consider this logic from Mary Drummond, CMO at Worthix:

  • “You may ask yourself whether you need a permanent executive at the helm. You can easily answer this by looking at other departments in your organization. Would you fire your Chief Product/Technology Officer once the product is ready? Would you fire your CMO once your strategy and ads are up and running?
     
    No, you wouldn’t. Why? Because change is inevitable, and the constant nature of innovation makes it imperative to continuously update your value proposition to attend to customers’ ever-changing expectations.4
     
    You’ll always need a dedicated quarterback, pitcher, or team captain to navigate your customer experience strategy.

Trash talk? Some leaders agree with the short play for Chief Customer Officer strategy:

  • The majority of B2C CCOs interviewed by the Wall Street Journal hope they are the first and last Chief Experience Officers in their companies. “They want their focus on keeping customers happy to seep into all levels and departments of the company, essentially putting themselves out of a job.”5
     
  • “Shouldn’t everybody be encouraged to regularly test the customer experience? Does it take a CXO2 to remind us of that?”, echoed James Heskett, author of The Service Profit Chain, in a subsequent Harvard Business School article.4
     
  • “The CXO2 position may indeed rightfully go away as the focus on experiences becomes infused in the organization,” said Joe Pine, author of The Experience Economy, in response to these two articles.4

Heads up! That level of ingrained customer-centricity is muscle memory. It requires tremendous practice. However, none of the interviewed CCOs are in a position to score this customer-centricity trophy. Do you see anything in a job scope below about customer-focus seeping into all levels and departments of the company?

  • The CCO at Under Armour oversees global marketing, e-commerce, and retail.6
     
  • Bed Bath & Beyond combined the Chief Digital Officer and Chief Brand Officer into a new CCO role in 2021, with responsibility for customer service, store remodeling, and partnership with Kroger.6
     
  • McDonald’s CCO focuses on Marketing, data analytics, digital customer engagement, restaurant development, and restaurant solutions.7
     
  • Comcast Cable CCO is responsible for field service and care operations, emphasizing (a) development and delivery of new technologies, tools, and platforms and (b) VoC for Support and staying ahead of rapidly evolving consumer needs.8
     
  • CCOs with software as a service (SaaS) business models typically oversee Support, Professional Services, Onboarding and Education, and Customer Success.9

Foul ball! Those job scopes are centered on customer touchpoints — not seeping customer-focus into all levels and departments of the company. You’ll never ingrain customer-centricity without primary emphasis on outside-in thinking for every function, as explained by these B2B CCOs:

  • “I remember working at a Japanese company in the early 90s. All everyone talked about was the customer, whether they worked in Product Planning, Design, chassis engineering, procurement, or any other department. There was no need for a customer-centric program or a CX team. It was in their DNA,” says Kim MacGillavry, CCO at Otis Elevator.
     
    “I only really understood this when I started working in other companies that had lost touch with their customers and where departments worked on their own agenda in silos,” he continued.
     
    “Let’s see how long it takes for companies to become truly customer centric where the basic mindset of everyone in the organisation puts customers first,” he challenges.10
     
  • “The most important role of a CCO is to bring a customer perspective to the many different functions of the company,” says Eduarda Camacho, CCO at BMC.9

Time out! Why do all these CCOs say customer-centricity is a high priority for every player in your enterprise ecosystem?

  • Like a sports team, you can’t have something else at the center of your attention in the off-season, locker room, or practice field — and then expect stellar performance in your league competitions. Is everyone’s attention consistent?
     
  • “Centricity” is whatever is at the center of your decisions and actions. When your whole enterprise is not unified in the quest for customer-aligned management, you’re creating silos. Is everyone unified?
     
  • Silos are toxic to seamless customer experience. Any weak player on your team is apt to ruin a play or cost you a game or even a season. Defensive plays (and a lot of offensive plays) in CXM are mainly necessary to make up for catastrophes or weak plays. Often, these failed plays are originated by non-customer-facing work groups. Who’s pursuing this?

Forfeit? Every industry today is on the sidelines with customer trust. For “How much do you trust each type of business to do what is right?”, the percentages below are the bottom 5 rating points (1-5) on a 9-point scale (32,000 respondents, 28 countries) in the Edelman Trust Barometer study:

  • 33% do not trust family-owned businesses (versus 34% in 2016).
     
  • 42% do not trust private businesses.
     
  • 45% do not trust public businesses (versus 48% in 2016).
     
  • 50% do not trust state-owned businesses (versus 54% in 2016).

Prosperity for everyone suffers due to low trust (for example, wasted time, stress, duplicated effort, lost opportunities, inconsistency, squandered resources, negativity, etc.). Imagine how much more value every individual, family, and entity could gain with higher trust! Maybe it’s not just the Chief Customer Officer on a path to dispensability, but your enterprise11 as well?

Indeed, the highest value for your Chief Customer Officer strategy is seeping customer focus into all levels and departments of the company!

Most Valuable Player

Half-time! With trust this low, organizations globally are nowhere close to a customer-centricity trophy. Is your “outside-in” approach skin-deep?

  • Now that we’re into the 2020s, let’s adapt to today’s realities. Since the 2010s, MUCH has changed, yet experience management has only adapted with digitalization and diversity.
     
  • With trust so low, it’s time to bring in your entire team and staff. It’s urgent to ease up on revenue-centered touchpoint management and experience management of yesteryear. Besides, established roles are already championing this.
     
  • You still need those revenue-centered plays, but in accordance with 2020s urgent needs, NOW you’ll place top emphasis on trust-centered “Experience Leadership” in your Chief Customer Officer strategy.

Customer Experience Strategy Leadership

“Experience Leadership” is companywide alignment to the goals of your customers, partners, and employees. Business success depends on consistently meeting or exceeding stakeholders’ expectations, to be preferred by customers, partners, employees, and investors. It makes no sense for organizations to be out of alignment with these three vital stakeholders. You and your investors rely on them.

The Experience Officer is charged with the responsibility — like a maestro — of weaving departments, processes, and teams together to keep the entire company on track with customer needs. — Mary Drummond, CMO, Worthix

Customer Lifetime Value

Return on InvestmentMaximize lifetime value by ensuring customer-inspired growth and costs.

Customer-Inspired Growth

  • 1a) Is every growth endeavor inspired and shaped by customer insights?
    If not, you’re sidelining value.
     
    Notes:
    (i) Growth endeavors are strategies, new product development, go-to-market, portfolio, business model, market expansion, merger, etc.
     
    (ii) Customer insights inspire growth via Expectations VoC: mining and qualitative research about customers’ circumstances and goals.
     

Customer-Guided Costs

  • 2a) Is every pursuit of efficiency guided by what’s most and least important to customers?
    If not, it’s a rainout for fans and owners.
     
    Notes:
    (i) Efficiency via process improvement, budget allocation, austerity, shrinkflation, re-organization, etc.
     
    (ii) CX Annuities are freed-up value by (a) stopping recurrence of prevalent pebbles in customers’ shoes and (b) right-the-first-time delivery to customers’ expectations.
     

    • 2b) Is solving execution silos and operational silos the focus of your Customer Experience Council or Steering Committee?
      If not, you’re winning by gamesmanship.
       
    • 2c) Is someone ensuring a one-to-one ratio in what’s received versus expected by customers?
      If not, your entire franchise may become dispensable!11
       
    • Notes:
      (i) A gap in the one-to-one ratio is a brand integrity gap.
      (ii) This is at the heart of TRUST.
      (iii) This gap means lifetime value and ROI are low due to extensive value-rescuing.
      (iv) This is a gigantic cost savings opportunity: CX Annuities.
      (v) Closing the brand integrity gap generates magnetic retention, acquisition, spending expansion, recommendations, and so on.

Wide open! Who’s preventing roadblocks to value? You have a trust crisis with money flying out the window due to value-rescuing necessities. Automatic CX excellence mistake-proofs what customers receive and what they expect.

  • CCO Role: transform from value-rescuing to value-creating.
     
  • CCO Goal: automatic customer experience excellence.
     
  • CCO Reward: maximum lifetime value.

Show me the money! Outer loop VoC is where the huge CXM ROI is (see diagram below). It’s the foundation of lifetime value. Bonus: it seeps customer focus into all levels and departments of your company.

We saved ourselves millions of dollars and hours through Experience Leadership when I led CXM, emphasizing outer loop VoC. This freed us up to create far more strategic value. Most importantly, we saved customers’ precious resources in the millions and that increased our magnetic attraction for customer retention and acquisition growth.

Customer Experience Strategy Value

When I led companywide customer experience transformation, my role was chartered for outer loop emphasis. We led both inner and outer loop VoC, with a major focus on every P&L making a root cause action plan for their top two key drivers of loyalty. That meant we had 100+ outer loop plans underway simultaneously, upgraded to the next key drivers each year, for many years. Their action plan progress was monitored by internal metrics called Customer-Critical Factors. By frequently reviewing, recognizing, and rewarding Customer-Critical Factors, customer-centricity seeped into all levels and departments of our company!

Substitution? While plenty of people already champion revenue growth, TRUST management is alarmingly overlooked. Step into this opportunity, Chief Customer Officers!

Experience Leadership as your Chief Customer Officer strategy is impossible to make redundant to existing C-Suite roles (CMO, CRO, CTO, CSO, CDO, CBO, CHRO12). None of those C-Suite roles has the bandwidth or competencies needed:

  1. Establishes a lifetime value mindset companywide.
     
  2. Champions customer insights as the basis for every growth and efficiency endeavor.
     
    • Ensures realistic expectations in customer acquisition and engagement that emphasize lifetime value. (LTV)
       
    • Empowers strategic planning to consider customers’ views FIRST about your opportunities and threats, and strengths and weaknesses.
       
    • Guides managers in connecting customer outcomes to business outcomes at every opportunity.
       
    • Makes intentional customer experience the North Star.
       
    • Stops root causes of the brand integrity gap.

Hey, Coach! Position yourself as a companywide facilitator for customer-centricity alignment. You can call it risk reduction, value maximization, or any other exciting name. It’s companywide because everyone is needed to free up precious value-rescuing budget that could otherwise fund value-creating: expanded capabilities and opportunities, salary and bonus increases, and higher profit-sharing.

Let customer-facing groups report to the CCO or wherever it’s most natural in your company. Dotted-line reporting to the CCO is sufficient. When every customer management function reports to the CCO, customer-centricity tends to be lower. This structure influences the non-customer-facing work groups to think falsely: “That other group covers customer experience. It has nothing to do with me.” Trust cannot grow without everyone’s participation. “One bad apple spoils the barrel”. You must engage every work group across your company to manage their ripple effect on customer experience costs and gains: ROI and LTV.

Most Valuable Player! When top priority for your Chief Customer Officer strategy is engaging everyone in walking the talk, customers are organic fans and remedial investments are far smaller. Your CFO and investors will love the risk reduction and growth expansion ensured by Experience Leadership. Performance consistency nurtures trust, which strengthens relationships, which are a prerequisite to maximum customer lifetime value.

Experience Leadership is the key to mistake-proofing what customers get and what they expect. It’s the foundation for automatic CX excellence. Experience Leadership requires everyone to walk the talk in putting customer well-being first. It’s the heart of CXM: what truly builds trust and long-lasting gains for all.

Notes:
1Short plays are tactics that create space by drawing players out of position, to carefully move toward the goal line. Short Plays, GuidetoFM.com (guide to football managers).
2CCO is also called Chief Experience Officer (CXO) or Vice President, Chief, or Head of Experience Strategy, Customer Experience, Customer Success, or similar phrasing.
3Outback Steakhouse Owner Cuts Chief Customer Officer Role, Wall Street Journal, December 22, 2021.
4Should the Chief Experience Officer Cease to Exist?, CustomerThink.com, Mary Drummond, July 15, 2021.
5Some Chief Experience Officers Want to Make Their Jobs Disappear, Wall Street Journal, June 23, 2021.
6Bed Bath & Beyond Names Its First Chief Customer Officer, Wall Street Journal, November 4, 2021.
7McDonald’s Appoints Its First Global Chief Customer Officer, Wall Street Journal, July 27, 2021.
8Comcast Cable Chief Customer Experience Officer, Comcast.com.
9The Chief Customer Officer Playbook, Rod Cherkas, 2023.
10LinkedIn discussion, 2021.
11Major Retail Chains No Longer Exist, Stacker, December 28, 2022.
12CMO is Chief Marketing Officer, CRO is Chief Revenue Officer (aka Chief Growth Officer), CTO is Chief Technology Officer (aka CIO), CSO is Chief Sales Officer, CDO is Chief Digital Officer, CBO is Chief Brand Officer.

  • Most firms today use CCO as a fresh label for one of these functional areas, or a combination of them. Gartner’s Customer Experience Management Survey reported an increase in CCO roles from 61% in 2017 to 90% of 401 brands surveyed in 2021.3
  • Still, there are currently about 4,000 CCOs in the world, compared to more than 57,000 CMOs and 200,000 CFOs.9

This article is the second in a five-part series:
1. Chief Customer Officer Playbook: Balancing Experience Leadership with Experience Management

2. Chief Customer Officer Strategy: Redundant Playbook or Most Valuable Player?
3. Chief Customer Officer Maturity Playbook
4. Chief Customer Officer Leadership Playbook
5. Chief Customer Officer Prosperity Playbook

Image licensed to ClearAction Continuum by Shutterstock.

Lynn Hunsaker

Lynn Hunsaker is 1 of 5 CustomerThink Hall of Fame authors. She built CX maturity via customer experience, strategic planning, quality, and marketing roles at Applied Materials and Sonoco. She was a CXPA board member and SVAMA president, taught 25 college courses, and authored 6 CXM studies and many CXM handbooks and courses. Her specialties are B2B, silos, customer-centric business and marketing, engaging C-Suite and non-customer-facing groups in CX, leading indicators, ROI, maturity. CX leaders in 50+ countries benefit from her self-paced e-consulting: Masterminds, Value Exchange, and more.

2 COMMENTS

  1. Very insightful and practical understanding of Closed loop(Voc), Inner-loop & Outerloop in any business operations.

    Clear understanding of CCO role and impact of Experience Leadership.

    @Lynn, thank you for always sharing your vast knowledge of CX with the world. I am glad to be part of those benefiting.

    I will always recommend you.

  2. It’s always nice to see appreciation for the hard work that goes into an article like this. I always learn something from the effort to put ideas into a flowing sequence, especially when adding a metaphor theme like team sports.

    So many good ideas . . . so little time! Thanks, Evas, for reading and interacting, very nice.

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