Category Archives: marketing

You Just Got Starbucked

Layoffs, Store Closures & What It Means for Customer Service

Exclusive Interview with Mario Matulich

In a world where corporate decisions often prioritize efficiency, the human element can be the first to suffer. The recent layoffs and restructuring at Starbucks, a brand synonymous with a unique, human-centered “third place” experience, have sent a tremor through the industry. In a wide-ranging interview, we will unpack the strategic and operational implications of these changes. Together, we will explore the difficult balance between trimming corporate fat and maintaining a brand built on emotional connection, diving into how these decisions could affect everything from in-store morale to the long-term loyalty of its customers. Central to the conversation is the following strategic question:

How can a company that has undergone significant corporate restructuring and layoffs maintain and restore a premium, human-centered customer experience?

Today we will explore this question, along with its various aspects with our special guest Mario Matulich, a practice lead at the Customer Management Practice with a diverse commercial understanding in a variety of industry verticals across the customer management sector. He is well versed in market research, product development, sales, marketing, and operations in addition to cross functional management and leadership development.

Without further ado, here is the Q&A I had with Mario on a range of topics regarding the recent Starbucks’ store closures and layoffs and their implications:

The Strategic Context of the Layoffs

Q: Starbucks’ leadership framed the recent restructuring as a necessary step for efficiency and a return to their core mission. From your perspective in customer management, how do these internal changes directly affect the external customer experience in the short and long term?
A: In the short term, layoffs, especially in corporate roles, can create gaps in innovation, brand narrative, and strategic support for store-level teams. Employees on the front lines may feel increased pressure, which can impact morale and the human connection customers expect. In the long term, if these gaps aren’t addressed, the result can be a more transactional experience that erodes both loyalty and trust.

Q: In many companies, layoffs are a last resort. Do you believe this restructuring reflects a failure of previous strategies, or is it a forward-thinking move to adapt to a changing market? What specific market trends do you think are driving these decisions?
A: I don’t view this restructuring as purely a failure of previous strategies, but rather as an attempt to adapt to a changing market. That said, Starbucks’ bigger challenge is restoring its customer experience. Trends such as rising demand for personalized, convenient, and high-value experiences, along with increased competition in the premium coffee market, make it clear that customers are evaluating Starbucks not just on price, but on the overall experience delivered.

Q: The layoffs primarily targeted corporate roles in marketing, technology, and creative. How does the loss of talent in these specific areas impact the company’s ability to innovate and maintain its brand narrative?
A: These areas are critical for innovation, storytelling, and digital experiences that connect customers to the brand. Losing talent here makes it more challenging to maintain a consistent, differentiated experience and risks further disengagement from customers.

Impact on the Human-Centered Experience

Q: Starbucks has long prided itself on the “third place” concept. How does restructuring and potential employee demoralization affect the in-store experience and the emotional connection customers have with the brand?
A: The “third place” experience relies on motivated and supported employees. Restructuring can disrupt this, as uncertainty and low morale may trickle down to in-store interactions. Customers may perceive a decline in warmth, attentiveness, and consistency, which can undermine the emotional connection.

Q: With fewer people in corporate roles, who now owns the responsibility for a seamless customer journey? Does this push more responsibility onto store-level partners, and if so, are they equipped to handle it?
A: While partners remain at the front line, the burden shouldn’t fall solely on them. Leadership must provide tools, guidance, and support to ensure a seamless experience, even as corporate teams shrink.

Q: Customer management is about building long-term loyalty. Do you believe this restructuring risks eroding the trust and loyalty of both employees and customers, and what would your practice recommend to mitigate that risk?
A: Yes, there’s definitely a risk. The key is to go back to the basics and make the experience personal, easy, and fast. Nail those, and customers’ trust and loyalty will .,¬./come back, and the layoffs won’t linger in their minds.

Measuring and Recovering from the Impact

Q: How would you advise Starbucks to measure the real-time impact of these changes on customer satisfaction? Beyond traditional metrics like NPS, what holistic experience measures should they be tracking?
A: Starbucks should look beyond NPS to measure speed of service, personalization, emotional connection, and overall experience consistency. These metrics provide a more comprehensive view of the customer journey and help identify gaps that layoffs may create.

Q: Layoffs can create a perception of instability. What is the most effective way for a company to communicate its recovery plan and rebuild confidence with its customer base after such a significant change?
A: Clear communication focused on restoring the core pillars of customer experience, personalization, ease, and speed, is key. Customers respond when they see tangible improvements in the experience they receive every day.

Q: In your experience, what is the typical timeline for a company to recover from the brand and cultural damage that can follow widespread layoffs? What are the critical milestones they should be focused on achieving?
A: Recovery timelines vary, but visible improvements in customer experience can begin within months if executed strategically. Critical milestones include reestablishing operational consistency, restoring employee morale, and relaunching key brand initiatives that reinforce the premium experience promise.

Future-Proofing for Long-Term Growth

Q: Looking ahead, how can Starbucks utilize this moment of disruption to adopt a more resilient and human-centered organizational model? What key lesson should other companies learn from their experience to avoid similar pitfalls?
A: Starbucks has a chance here to get back to what really made it successful: combining innovative, tech-forward solutions with a human touch, every time. The bigger lesson for any company is clear. Growth and cost-cutting shouldn’t come at the expense of the customer experience. People are willing to pay a premium, but only if the experience feels worth it.

Q: What message does it send that the popular Starbucks Roastery location in Capitol Hill in Seattle is being closed as part of this layoff and restructuring initiative? Why do you think they chose to do it?
A: Closing the Roastery signals a prioritization of efficiency over experiential destinations. While it may make financial sense in the short term, it also serves as a cautionary reminder that iconic, high-touch experiences are critical to maintaining brand differentiation and customer loyalty.

Conclusion

Thank you for the great conversation Mario!

Ultimately, the Starbucks case study is a powerful lesson for every organization. As Matulich’s insights make clear, the pursuit of efficiency and growth cannot come at the expense of the human experience that defines your brand. The true measure of a company’s resilience is not in its stock price, but in the trust it has built with its employees and customers. A single-minded focus on traditional metrics is insufficient; a holistic approach that values emotional connection and employee morale is the only path to sustainable growth. The greatest challenge for Starbucks now is to move beyond reacting to a difficult market and begin proactively shaping its future—not just through cost-cutting, but by recommitting to the core narrative that made it a cultural institution in the first place. The future of any business is not found in a spreadsheet; it’s built on a foundation of human connection, one interaction at a time.

Image credits: Pexels, Mario Matulich

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

The Tricky Business of Tariffs

Leave a reply

The Tricky Business of Tariffs

GUEST POST from Shep Hyken

Tariffs are creating havoc and panic for both customers and businesses. Depending on what you read, the cost-of-living increase for the average consumer can be thousands of dollars a year. And it’s the same for business, but often at a much higher cost. Anything a business purchases to run its day-to-day operations is potentially exposed to higher prices due to tariffs. Whatever businesses buy—supplies, inventory, equipment and more—when it costs them more, that cost is passed on to their customers.

This isn’t the first time there has been “tariff panic.” As recently as 2018, there were tariffs. I wrote a Forbes article about an e-bike company that was forced to raise its prices due to a 25% import tariff. The company was open about the reasons for the price increase and embraced the problem rather than becoming a victim of it. Here are some ways to manage the impact of tariffs:

Be Transparent: Everyone may know about the tariffs, but explaining how they are impacting costs will help justify the price increase. In other words, don’t hide the fact that tariffs are impacting your costs.
Partner with Vendors: Ask vendors to work with you on a solution to lower costs that won’t hit their bottom lines. If you buy from a vendor every month, maybe it’s less expensive to buy the same amount but ship quarterly instead of monthly. Work with them to find creative ways to reduce costs. This can benefit everyone.
Improve Efficiency to Offset Costs: If you’ve thought about a way to improve a process or efficiency but haven’t acted on it, now may be the perfect time to do so. Sometimes being forced to do something can work in your favor. And be sure to share what you’re changing to help reduce costs. Customers may appreciate you even more.
Add Value Instead of Just Raising Prices: When price increases are unavoidable, find a way to justify the higher cost. It could include anything—enhanced customer service, a loyalty rewards program, a special promotion and more. Customers may accept paying more if they feel they are getting more value in return.

What NOT to do:

Don’t Take Advantage of Customer Panic: As I write this article, people are going to car dealerships to buy cars before the prices increase and finding that the dealers are selling above the retail sticker price because of the demand. Do you think a customer will forget they were “gouged” by a company taking advantage of them during tough times? (That’s a rhetorical question, but just in case you don’t know the answer … They won’t!)
Don’t Say, “It’s Not my Fault”: Even when price increases are beyond your control, don’t be defensive. This can give the impression of a lack of confidence and lack of control that can erode the trust you have with your customers.
Don’t Say, “It’s the Same Everywhere You Go”: If the customer understands tariffs, they already know this. Stating you have no choice isn’t going to make the customer feel good. Go back to the list of what you can do and find a way to avoid this and the “it’s not my fault” response.

Customers want to hear what you’re doing to help them. They also like to be educated. Knowledge can give the customer a sense of control. Demonstrating genuine concern for the situation and sharing what you’re doing to minimize the impact of tariff-related price increases builds trust that will pay dividends long after the current economic challenges have passed.

Image Credits: Unsplash, Shep Hyken

This article originally appeared on Forbes.com

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Is All Publicity Good Publicity?

Leave a reply

Some Insights from Cracker Barrel

Is All Publicity Good Publicity?

GUEST POST from Pete Foley

The Cracker Barrel rebrand has certainly created a lot of media and social media attention. Everything happened so fast that I have had to rewrite this introduction twice in as many days. Originally written when the new logo was in place, it has subsequently been withdrawn and replaced with the original one.

It’s probably been a expensive, somewhat embarrassing and sleepless week for the Cracker Barrel management team. But also one that generated a great deal of ‘free’ publicity for them. You could argue that despite the cost of a major rebranding and de-branding, this episode was priceless from a marketing penetration perspective. There is no way they could have spent enough to generate the level of media and social media they have achieved, if not necessarily enjoyed.

But of course, it raises the perennial question ‘is all publicity good publicity?’ With brands, I’d argue not always. For certain, both good and bad publicity adds to ‘brand fluency’ and mental availability. But whether that is positively or negatively valanced, or triggers implicit or explicit approach or avoid responses is less straightforward. A case in point is of course Budweiser, who generated a lot of free media, but are still trying to drag themselves out of the Bud Light controversy.

Listening to the Customer: But when the dust settles, I suspect that Cracker Barrel will come out of this quite well. They enjoyed massive media and social media exposure, elevating the ‘mindshare’ of their brand. And to their credit, they’ve also, albeit a little reluctantly, listened to their customers. The quick change back to their legacy branding must ave been painful, but from a customer perspective, it screams ‘I hear you, and I value you’.

The Political Minefield. But there is some lingering complexity. Somehow the logo change became associated with politics. That is not exactly unusual these days, and when it happens, it inevitably triggers passion, polarization and outrage. I find it a quite depressing commentary on the current state of society that a restaurant logo can trigger ‘outrage. But like it or not, as change agents, these emotions, polarization and dubious political framing are a reality we all have to deal with. In this case, I personally suspect that any politically driven market effects will be short-lived. To my eye, any political position was unintentional, generated by social media rather than the company, and the connection between logo design and political affiliation is at best tenuous, and lacks the depth of meaning typically required for persistent outrage. The mobs should move on.

The Man on the Moon: But it does illustrate a broader problem for innovation derived from our current polarized society. If a logo simplification can somehow take on political overtones, pretty much any change or innovation can. Change nearly always comes with supporters and detractors, reflecting the somewhat contradictory nature of human behavior and cognition – we are change agents who also operate largely from habits. Our response to innovation is therefore inherently polarized, both as individuals and as a society, with elements of both behavioral inertia and change affinity. But with society deeply polarized and divided, it is perhaps inevitable that we will see connections between two different polarizations, whether they are logical or causal or not. We humans are pattern creators, evolved to see connections where they may or may not exist. This ability to see patterns using partial data protected us, and helped us see predators, food or even potential mates using limited information. Spotting a predator from a few glimpses through the trees obviously has huge advantages over waiting until it ambushes us. So we see animals in clouds, patterns in the stars, faces on the moon, and on some occasions, political intent where none probably exists.

My original intent with this article was to look at the design change for the logo from a fundamental visual science perspective. From that perspective, I thought it was quite flawed. But as the story quickly evolved, I couldn’t ignore the societal, social media and political element. Context really does matter. But if we step back from that, there are stillo some really interesting technical design insights we can glean.

1. Simplicity is deceptively complex. The current trend towards reducing complexity and even color in a brands visual language superficially makes sense. After all, the reduced amount of information and complexity should be easier for our brains to visually process. And low cognitive processing costs come with all sorts of benefits. But unfortunately it’s not quite that simple. With familiar objects, our brain doesn’t construct images from scratch, but instead takes the less intuitive, but more cognitively efficient route of unconsciously matching what we see to our existing memory. This allows us to recognize familiar objects with a minimum of cognitive effort, and without needing to process all of the visual details they contain. Our memory, as opposed to our vision, fills in much of the details. But this process means that dramatic simplification of a well established visual language or brand, if not done very carefully, can inhibit that matching process. So counterintuitively, if we remove the wrong visual cues, it can make a simplified visual language or brand more difficult to process than it’s original, and thus harder to find, at least for established customers. Put another way, the way our visual system operates, it automatically and very quickly (faster than we can consciously think) reduces images down to their visual essence. If we try to do that ourselves, we need to very clearly understand what the key visual elements are, and make sure we keep the right ones. Cracker Barrel has lost some basic shapes, and removed several visual elements completely, meaning it has likely not done a great job in that respect.

2. Managing the Distinctive-Simple Trade Off. Our brains have evolved to be very efficient, so as noted above, we only do the ‘heavy lifting’ of encoding complex designs into memory once. We then use a shortcut of matching what we see to what we already know, and so can recognize relatively complex but familiar objects with relatively little effort. This matching process means a familiar visual scene like the old Cracker Barrel logo is quickly processed as a ‘whole’, as opposed to a complex, detailed image. But unfortunately, this means the devil is in the details, and a dramatic simplification like Cracker Barrels can unintentionally remove many of the cues or signals that allowed us to unconsciously recognize it with minimal cognitive effort.

And the process of minimizing visual complexity can also remove much of what made the brand both familiar and distinctive in parallel. And it’s the relatively low resolution elements of the design that make it distinctive. To get a feel for this, try squinting at the old and new brand. With the old design, squinting loses the details of the barrel, or the old man, But the rough shape of them, and of the logo, and their relative positions remain. That gives a rough approximation of what our visual system feeds into our brain when looking for a match with our memory. Do the same with the new logo, and it has little or no consistency or distinctivity. This means the new logo is unintentionally making it harder for customers to either find it (in memory or elsewhere) or recognize it.

As a side effect, oversimplification also risks looking ‘generic’, and falling into the noise created by a growing sea of increasingly simplified logos. Now, to be fair, historical context matters. If information is not encoded into memory, the matching process fails, and a visual memory needs to be built from scratch. So if we were a new brand, Cracker Barrels new brand visual language might lack distinctivity, but it would certainly carry ease of processing benefits for new customers, whereas the legacy label would likely be too complex, and would quite likely be broadly deselected. But because the old design already owns ‘mindspace’ with existing customers, the dramatic change risks and removal of basic visual cues asks repeat customers to ’think’ at a more conscious level, and so potentially challenges long established habits. A major risk for any established brand

3. Distinctivity Matters. All visual branding represents a trade off. We need signal to noise characteristics that stand out from the crowd, or we are unlikely to be noticed. But we also need to look like we belong to a category, or we risk being deselected. It’s a balancing act. Look too much like category archetypes, and lack distinctivity, and we fade into the background noise, and appear generic. But look too different, and we stand out, but in a potentially bad way, by asking potential customers to put in too much work to understand us. This will often lead a customer to quickly de-select us. It’s a trade off where controlled complexity can curate distinctive cues to stand out, while also incorporating enough category prototype cues to make it feel right. Combine this with sufficient simplicity to ease processing fluency, and we likely have a winning design, especially for new customers. But it’s a delicate balancing act between competing variables

4. People don’t like change. As mentioned earlier, we have a complex relationship with change. We like some, but not too much. Change asks their brains to work harder, so it needs to provide value. I’m skeptical the in this case, it added commensurate value to the customer. And change also breaks habits. So any major rebrand comes with risk for a well established brand. But it’s a balancing act, and we should remain locked into aging designs forever. As the context we operate in changes, we need to ‘move with the times’, and remain consistent in our relationship with our context, at least as much as we remain consistent with our history.

And of course, there is also a trade off between a visual language that resonates with existing customers and one designed to attract new ones, as ultimately, virtually every brand needs both trial and repeat. But for established brands evolutionary change is usually the way to achieve reach and trial without alienating existing customers. Coke are the masters of this. Look at how their brand has evolved over time, staying contemporary, but without creating the kind of ‘cognitive jolts’ the Cracker Barrel rebrand has created. If you look at an old Coke advertisement, you intuitively know both that it’s old, but also that it is Coke.

Brands and Politics. I generally advise brands to stay out of politics. With a few exceptions, entering this minefield risks alienating 50% of our customers. And any subsequent ‘course corrections’ risk alienating those that are left. For a vast majorities of companies, the cost-benefit equation simply doesn’t work!

But in this case, we are seeing consumers interpreting change through a political lens, even when that was not the intent. But just because it’s not there doesn’t mean it doesn’t matter, as Cracker barrel is discovered. So I’m changing my advice from ‘don’t be political’ to ‘try and anticipate if you’re initiative could be misunderstood as political’. It’s a subtle, but important difference.

And as a build, marketers often try to incorporate secondary messages into their communication. But in todays charged political climate, I think we need to be careful about being too ‘clever’ in this respect. Consumer’s sensitivity to socio-political cues is very high at present, as the Cracker Barrel example shows. So if they can see political content where none was intended, they are quite likely to spot any secondary or ‘implicit’ messaging. So for example, an advertisement that features a lot of flags and patriotic displays, or one that predominately features members of the LBGTQ community both run a risk of being perceived as ‘making a political statement’, whether it is intended to or not. There is absolutely nothing wrong with either patriotism or the LBGT community, and to be fair, as society becomes increasingly polarized, it’s increasingly hard to create content that doesn’t somehow offend someone. At least without becoming so ‘vanilla’ that the content is largely pointless, and doesn’t cut through the noise. But from a business perspective, in today’s socially and politically fractured world, any perceived political bias or message in either direction comes with business risks. Proceed with caution.

And keep in mind we’ve evolved to respond more intensely to negatives than positives – Caution kept our ancestors alive. If we half see a coiled object in the grass that could be a garden hose or a snake, our instinct is to back off. If we mistake a garden hose for a snake to cost is small. But if we mistake a venomous snake for a garden hose, the cost could be high.

As I implied earlier, when consumers look at our content though specific and increasingly intense partisan lens, it’s really difficult for us to not be perceived as being either ‘for’ or ‘against’ them. And keep in mind, the cost of undoing even an unintended political statement is inevitably higher than the cost of making it. So it’s at very least worth trying to avoid being dragged into a political space whenever possible, especially as a negative. So be careful out there, and embrace some devils advocate thinking. Even if we are not trying to make a point, implicitly or explicitly, we need to step back and look at how those who see the world from deeply polarized position could interpret us. The ‘no such thing as bad publicity’ concept sits on very thin ice at this moment in time, where social media often seeks to punish more than communicate

Image credits: Wikimedia Commons

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

When You Don’t Have What the Customer Wants

Leave a reply

When You Don't Have What the Customer Wants

GUEST POST from Shep Hyken

I recently responded to a question on LinkedIn: A customer is furious about an out-of-stock item. How do you turn their frustration into satisfaction?

I added a second part to that question. What if what the customer wants is something you’ve never had in stock? Some customers might still be angry that you do not have what they want. And even if they aren’t, whether the item is out of stock or you just don’t carry it, that doesn’t mean you can’t make the customer happy.

Before we go further, let me do a very quick recap of how to deal with any upset or complaining customer. This is my five-step process for handling complaints:

Apologize for the problem.
Acknowledge what the problem is.
Discuss the resolution. (In a moment, I’ll cover this in detail.)
Accept ownership. It may not be your fault, but now you own taking care of the customer.
Act with urgency.

So, back to #3, the resolution. Is the item the customer wants temporarily out of stock? If so, when will it be in, and when can the customer expect to receive it? Giving customers information gives them a sense of control.

Shep Hyken Empty Shelves Cartoon

What if you’re out of the item and won’t get any more back in inventory? This is an opportunity to shine. If you can’t suggest a reasonable alternative, does a competitor have what the customer wants? Yes, I’m suggesting sending the customer to a competitor. Even if the sale goes to a competitor, the customer will realize you’re more interested in getting them what they want and need versus making a sale, which can go a long way in building trust that takes the relationship to a higher level.

One of my favorite examples comes from an Ace Hardware store. It was a very cold winter, and a customer was upset to find out the store was out of space heaters. Rather than say, “Sorry,” and send the customer away, the associate called a competitor, confirmed they had a space heater, and asked them to hold it for his customer. And who do you think the customer loved after that experience? (It’s a rhetorical question, but just in case you can’t figure it out … Ace Hardware!)

Any time a customer is unhappy or has a complaint, it’s an opportunity to resolve the problem and turn a Moment of Misery™ into a Moment of Magic®. For inventory issues, it’s an easy fix. Always think to yourself, even if you have to give up the sale to a competitor, “Is what I’m doing right now going to get the customer to come back?” When you have the customer’s best interest in mind, they will!

Image Credits: Unsplash, Shep Hyken

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Mediocrity is the Enemy

Leave a reply

How Successful Companies Reclaim Their Competitive Edge

Mediocrity is the Enemy

GUEST POST from Shep Hyken

In 1983, I read In Search of Excellence by Tom Peters and Robert Waterman. This iconic business book featured case studies of successful companies. Forty years later, many of these companies are no longer considered “excellent.” Some are no longer in business. Many organizations that once stood as industry leaders started operating on autopilot, allowing standards to slip, not paying attention to the competition and not keeping up with their customers’ expectations.

I recently interviewed John Rossman, a former Amazon executive, on Amazing Business Radio. We discussed the business challenge of sinking into mediocrity that he writes about in his new book, which he refers to as a manifesto, The Pig, the Lipstick and the Playbook of Champions.

One of the intriguing sections in his manifesto is titled The Tragic Tale of Competitive Advantage, where he refers to Kodak, Blockbuster and Xerox as “examples of once category-defining companies that could not move beyond the success that made them disrupters.” These are the types of brands whose leaders could have benefited from reading this short but powerful work.

Below are several key takeaways from our interview. These are leadership principles that can help us avoid mediocrity—or worse, failure—and improve our chances for success.

Leadership: The Pig and the Lipstick

Rossman explains that the “pig” in the title of his leadership manifesto refers to a successful business. The “lipstick” represents the lies we tell ourselves. For example, leaders say, “Next year, we’ll grow more.” “Next year, we won’t disappoint customers.” “Next year we’ll innovate.” These lies create two challenges that businesses face today:

Once a company becomes successful, it has an increasingly difficult time reinventing its value proposition.
A gradual acceptance of mediocrity in how the employees work together, serve customers and measure success can creep in. Over time, mediocrity doesn’t just become acceptable. It becomes the target.

Embrace Humility

To break free from mediocrity, Rossman emphasizes that change must begin with humility. Companies must be willing to admit their shortcomings, whether they’ve disappointed customers or employees or failed their own ambitions. He recommends instituting a formal Voice of the Customer program and paying close attention to disappointed customers. Rossman says, “I truly believe in humility as a starting point for change. Recognizing where we fall short with customers is crucial to being able to innovate and thrive.”

Don’t Play Defense

Rossman talked about “gold standard” companies that slipped from playing at the top of their game, including Boeing, Intel, Nike and Starbucks. Rossman referenced an interview with Howard Schultz, CEO of Starbucks, who summed up what happened as the company started changing its model. Schultz said, “The worst thing that a company can do, like a sports team, is start playing defense because you’re afraid to fail. That’s a disease.”

Rossman’s response to companies in that situation came from his Amazon days, when he learned about the concept of Big Bets.

Taking Big Bets

The concept of Big Bets is about ambition. Rossman explains, “The concept of big bets at Amazon is that the ‘big’ is the ambition, not the size of the bet. Everything is an experiment with the intention of winning, realizing that many won’t. Understanding that failure comes with the game of innovation is a critical mindset.”

In other words, an innovation mindset comes from running many small experiments with big intentions, knowing full well that many will fail, but also knowing that the ones that succeed will keep you competitive and can potentially transform the business. You must constantly place these bets, or your successes may eventually fall to the level of mediocrity as competition catches up and potentially passes you up.

A Perfect Ending

Toward the end of the manifesto, Rossman shares a Michelangelo quote that sums up his way of thinking and is a perfect way to end this article: “The greater danger for most of us lies not in setting our aim too high and falling short, but in setting our aim too low and ache, including Boeing, Intel, Nike and Starbucks. Rossman referenced an interview with Howard Schultz, CEO of Starbucks, who summed up what happened as the company started changing its model. Schultz said, “The worst thing that a company can do, like a sports team, is start playing defense because you’re afraid to fail. That’s a disease.”

Rossman’s response to companies in that situation came from his Amazon days, when he learned about the concept of Big Bets.

Taking Big Bets

A Perfect Ending

This article was originally published on Forbes.com.

Image Credits: Pexels

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

The Importance of Over-committing

2 Replies

Strategizing Offer Power

The Importance of Over-committing - Strategizing Offer Power

GUEST POST from Geoffrey A. Moore

Offer power is a function of competitive separation that creates a material difference in customer benefit such that your offer is chosen over its closest alternatives. Separation, in turn, is created by over-committing to a single vector of innovation, taking it to a level that the competition either cannot or will not match. Whatever vector of innovation you choose will define your core, your claim to fame, the capability that sets you apart from the rest. Every other form of innovation will be context, meaning it will still meet market standards but will not differentiate your offering.

With respect to offer power, the most common strategic mistake is to spread the R&D budget across multiple vectors of innovation, making progress on all fronts but never achieving a level of competitive separation that is truly impactful. To offset this tendency, best practice begins with over-committing to a single value discipline, along the lines described by Michael Treacy and Fred Wiersema in The Value Disciplines of Market Leaders. They call out three such disciplines: product leadership, customer intimacy, and operational excellence. Those of us in Silicon Valley might add a fourth, disruptive technology, but the key point is to be asymmetrical in the allocation of resources to take one, and only one of these disciplines, “all the way to bright.”

Value disciplines tend to align with customer sensitivity to price and performance, as illustrated by the diagram below:

Geoffrey Moore Value Disciplines

Each quadrant in this model prioritizes a different value proposition. For customers who want performance at any cost, disruptive technology is a good bet, albeit coming with risks and issues that other customers would not accept. For enterprise customers, who typically are looking for productivity gains, product leadership fills that bill. For customers who are just looking to check the box with a minimum offer, economy is their watchword, and operational excellence is the main path. And finally, for customers who need the offer but don’t want to be bothered, convenience is the value proposition that resonates most, and customer intimacy is needed to design the experience accordingly.

Whatever offer power strategy you prioritize will act as a filter on your R&D budget allocation to ensure maximum return on innovation. Here is a way to look at the landscape:

Geoffrey Moore Return on Innovation

There are three ways to get a return on R&D innovation. The first is the one we have been focused on thus far—differentiation that leads to customer preference. But there are two other sources of return, both of which have value in their own right. The first of these is neutralization. This is innovation focused on catching up to some other competitor’s differentiation in order to neutralize their competitive advantage over you. Thus, while Apple is acknowledged as a master of differentiation, Microsoft is a master of neutralization, as once-market-leading and now-defunct enterprises like WordPerfect, Lotus, Ashton-Tate, Novell, and Netscape will all testify. Neutralization allows your customer base to stay current with next-generation product advancements without having to change out vendors. The key point for vendors to keep in mind is that when neutralizing you are trying to catch up, not get ahead, and so the goal is to get to “good enough” as fast as possible and then go no further.

A third type of return on innovation comes from optimization, improving the production and delivery of your current offering without materially changing its features or benefits. This allows you to sustain market positions in mature categories, enabling you to compete on price or capture the savings for other purposes. Because this effort is associated with operational excellence, people often do not recognize it as a form of innovation, but one need only look at what Amazon has done to reengineer the entire retail experience end to end to realize how foolish an idea this is.

One final point: not all innovations create a return. Failed attempts are an inevitable element in any portfolio of innovation attempts, the key being to follow the mantra, win or learn! That said, by far the more common reason that innovation investments fail to create a return is that they fall short of delivering a meaningful impact. This is true of:

Investments in differentiation that do not go far enough to create meaningful competitive separation. Typically, the team was unwilling to be sufficiently asymmetrical in its resource allocation. As a result, while its products are indeed different, they are not so in a sufficiently compelling way to impact customer preference. This is how Oldsmobile and Mercury lost their franchises in the US auto market.
Investments in neutralization that do not get to market fast enough to get your offer into the consideration set. Typically, the team making an extra effort to outperform the competitor at their own game, a low-percentage bet at best, but in so doing has left the playing field uncontested in the meantime. By the time you get back in the game, it is too late. This is how Nokia lost its market leadership position in smartphones to Apple.
Investments in optimization that do not go deep enough to make a material difference. Typically, teams avoid the hard work of process re-engineering and settle for an “across-the-board cut,” which saves money but actually weakens rather than improves performance.

That’s what I think. What do you think?

Image Credit: Unsplash, Geoffrey Moore

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

The Killer Strategic Concept You’ve Never Heard Of

Leave a reply

You Really Need to Know About Schwerpunkt!

GUEST POST from Greg Satell

When Steve Jobs returned to Apple in 1997, his first mission was not to create but destroy. He axed a number of failing products and initiatives, such as the ill-fated Newton personal digital assistant and the Macintosh clones. Under Jobs, Apple would no longer try to be all things to all people.

What came after was not a flurry of activity, but a limited number of highly targeted moves. First came the candy-colored iMac. It was a modest success. Then came the iPod, iPhone and iPad, breakout hits which propelled Apple from a failing company to the most valuable company on earth. Each move shifted the firm’s center of gravity to a decisive point and broke through.

That, in essence, is the principle of Schwerpunkt, a German military term that roughly translates to “focal point.” Jobs understood that he didn’t have to win everywhere, just where it mattered and focused Apple’s resources on just a few meaningful products. The truth is that good strategy relies less on charts and analysis than on finding your Schwerpunkt.

Putting Relative Strength Against Relative Weakness

The iPod, Apple’s first major hit after Jobs’ return, didn’t do anything to undermine the dominance of Microsoft and the PC, but rather focused Apple’s energy on a nascent, but fragmented industry that made products that, as Jobs put it, “sucked.” At this early stage, Apple probably couldn’t have taken on the computer giants, but it mopped up these guys.

Yet the move into music players wasn’t just about picking on scrawny weaklings, it leveraged some of Apple’s unique strengths, especially its ability to design simple, easy-to-use interfaces. Jobs’ own charisma and stature, not to mention the understanding of intellectual property rights he gained from his Pixar business, made him almost uniquely placed to navigate the challenges of setting up iTunes store, which at the time was a quagmire.

In Good Strategy | Bad Strategy management scholar Richard Rumelt makes the point that good strategy puts relative strength to bear against relative weakness and that is a key part of Schwerpunkt. In order to find your focal point, you need to get a sense of where your strengths lie and where are the best opportunities to leverage those strengths.

That’s exactly what Steve Jobs did at Apple over and over again. Entering the music player business would not have worked for Microsoft or Dell, who both dominated the computer industry at the time. In fact, after the launch of the iPod both tried to create competitors and failed. The iPod was Apple’s Schwerpunkt, nobody else’s.

Identifying The Focal Point

In a military conflict, leaders determine where to concentrate their efforts by weighing a variety of factors, including commander’s intent, or the desired end state, the situation on the ground gleaned through intelligence, the terrain and the enemy’s disposition on that terrain. Officers spend their whole careers learning how to make wise decisions about schwerpunkt.

Business leaders need to weigh similar factors, including the internal capabilities of their organization such as talent, technology and information, the market context, the competitive landscape as well as what they can access through external partner ecosystems. By the time Steve Jobs returned to Apple, he had become a master at evaluating the forces at play.

With respect to the iPod, he felt confident in Apple’s ability to combine technology with design and that the market for digital music players, as he liked to put it, sucked. By looking at what competitors had to offer, he was confident that if he could create a device that would “put 1000 songs in my pocket,” he would have a hit product.

The only problem was that the technology to create such a product didn’t exist yet. That’s where the external ecosystem came in. On a routine trip to Japan to meet with suppliers, an engineer at Toshiba mentioned that the company developed a tiny memory drive that was about the size of a silver dollar, but didn’t know what it could be used for.

Jobs immediately recognized that the memory drive was his Schwerpunkt. He produced a $10 million check on the spot and got exclusive rights to the technology. Not only would he be able to create his iPod with the “1000 songs in my pocket” he so coveted, for a time at least, none of his competitors would be able to duplicate its capability.

Getting Inside The OODA Loop

When he was still a pilot, the legendary military strategist John Boyd developed the OODA loop to improve his own decision making in the cockpit. The idea is that you first OBSERVE, your surroundings, then you ORIENT that information in terms of previous knowledge and experiences. That leads you to DECIDE and ACT, which will change the situation in some way, that you will need to observe, orient, decide and act upon.

We can see how Steve Jobs employed the OODA loop in making the decision to immediately produce a $10 million dollar check for a technology that Toshiba had no idea what to do with. He took the new information he observed and immediately oriented it with previous observations he made about the market for digital music devices.

Yet what happened next was even more interesting. When the iPod came out, it was an immediate hit, which changed the basis of competition. Other computer companies, which were competing in the realm of laptops, desktops and servers, suddenly faced a very different market and moved to create their own digital music players. Dell’s Digital Jukebox launched in 2004, Microsoft’s Zune came out in 2006. Both failed miserably.

By then Apple was already preparing the launch of the iPhone, which would change the game again, causing its competitors to Observe, Orient, Decide in Act in reaction to what Apple was doing. Boyd called this “getting inside your opponent’s OODA Loop.” By continually having to orient and react to Apple, they weren’t able to gain the initiative.

Today, it’s hard to remember just how powerful firms like Microsoft and Dell were back then, but they were absolute giants. Nevertheless, by employing the concept of Schwerpunkt, Apple went from near bankruptcy to dominating its rivals in less than a decade.

A Journey Rather Than A Destination

The biggest strategic mistake you can make is to try and win everywhere at once. To win, you need to prevail in the decisive battles, not the irrelevant skirmishes. That, in essence, is the principle of Schwerpunkt—to identify a focal point where you can direct your resources and efforts.

When Steve Jobs returned to Apple, computer companies were duking it out in the PC market, yet he identified digital music players as his Schwerpunkt and the iPod made Apple a serious player. As his competitors were still reacting, he launched the iPhone and on it went. Whenever Steve Jobs would, towards the end of a product presentation say, “and just one more thing,” You could guarantee that he had identified a new Schwerpunkt.

Notice how Schwerpunkt is a dynamic, not a static, concept. It was Jobs’ ability to constantly innovate Apple’s approach, by constantly observing, reorienting and shifting the competitive context. In each case, his strategy was uniquely suited to Apple’s, capabilities, customers and ecosystem. Competitors Microsoft or Dell, more suited to the enterprise market, couldn’t be successful with a similar approach.

There is no ideal strategy, just ones that are ideally suited to a particular context, when relative strength can be brought to bear against relative weakness. Discovering the center of gravity at which you can break through is more of a journey than a destination, you can never be sure beforehand where exactly you will find it, but it will become clear once you’ve arrived.

— Article courtesy of the Digital Tonto blog
— Image credit: Unsplash

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Turning Around Declining Customer Satisfaction

Leave a reply

Turning Around Declining Customer Satisfaction

GUEST POST from Shep Hyken

One of our subscribers asked, “How can I reverse our company’s declining customer satisfaction ratings?”

Not knowing specifics about the company, its customer feedback, how long the scores have declined, and other details makes it a difficult question to answer. Still, I felt compelled to share something that could help. What I came up with is a list of three “to-dos” that any company should use to find out what’s causing a downward trend.

As I was writing down my ideas, I realized that this list could also be used to find out what is causing customer satisfaction to go up. After all, don’t you want to know why customers are happy – and then do more of the same? Think about that as you read my short list. With that in mind, we’ll focus on the question of declining customer satisfaction.

Feedback Collection Cartoon Shep Hyken

My first response was three words: Find the friction!

Often, there are specific places in the customer’s journey that cause a drop in satisfaction. I refer to those as friction points. We want to eliminate or at least mitigate them. So how do you find these places? Three ideas:

1. Mystery shop your company. If you want to find out what customers experience, become a customer of your own company. Find out what customers experience during busy times, how long they have to wait on hold, how long it takes for someone to respond to an email and more.
2. Ask your customers. Get feedback through surveys and direct communication. When you hear about a complaint, follow up directly with the customer to learn more. Don’t assume it’s a one-off situation. If it’s happening to one customer, it could happen to many.
3. Ask your employees. The people working the front line, which includes the customer support team, salespeople and anyone else who interacts directly with customers, hear customer comments, both good and bad. Have ongoing conversations with front liners to learn what they are hearing.

Learning what customers are experiencing firsthand and having conversations with customers and employees is far different than reading a report. There’s nothing wrong with a report, and I advocate for that as well, but why not both? And once you have the information, don’t just talk about it. Do something about it. Find where there’s friction. Learn what makes customers unhappy. Change what needs to be changed. Then, watch for a trend of declining complaints and start to reap the benefits of rising customer satisfaction.

Image Credits: Pexels, Shep Hyken

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Are Your Customers’ Calls Actually Important?

Leave a reply

Are Your Customers' Calls Actually Important?

GUEST POST from Shep Hyken

Recently, I wrote an article about the customer service farce. One of several examples I shared was the line we often hear when calling customer support: “Your call is very important to us.” When we hear it, we hope it’s true. We hope it means that the company is going to respect our time, that someone will pick up the call quickly (versus being put on hold for an unreasonable amount of time), and that the agent we talk to will have the knowledge and skills to answer our question or resolve our complaint, and we’ll not have to repeat our story again and again.

In our most recent customer service and customer experience (CX) research, we asked a number of questions about contact centers that convey the message, “Your call is very important to us.” The answers will make you smile – maybe even laugh. I’ve shared some of these findings from surveys from the previous year. Here are the latest with a couple of new ones:

Cleaning the Toilet: Nearly four out of 10 customers (39%) say they would rather clean a toilet than call customer support. (That’s gross!)
A Root Canal Is Better Than This: A third of U.S. customers (34%) would rather visit the dentist than call customer support. (That’s painful!)
Dinner with In-Laws: Half of the customers (53%) say they would rather have dinner with their in-laws than call customer support. (That could be painful, too!)
Glossophobia (The Fear of Public Speaking): Even though speaking in public is one of the greatest fears, often ahead of death, one in four customers (26%) would rather speak in front of an audience of 1,000 than call customer support. (Yikes, that’s scary!)

But seriously … as humorous as some of these findings are, there’s some truth behind them. Consider these three findings from this year’s report:

Half of U.S. customers (51%) say that when they call customer support with a question or to resolve a problem, the company does not value their time.
And speaking of respecting time, over half of the customers we surveyed (55%) say they stopped doing business with a company or brand because it kept them on hold for too long.
Six out of 10 customers (63%) say they have stopped doing business with a company because of the inability to connect with someone from customer support. </li?

It sounds like I’m being negative, but the reality is that this information gives me hope – for the companies that get it right. The more serious findings mean that more than half of customers are ripe to switch companies, and if you’re doing it right, they are hopefully going to switch to you.

Whether your company has just a few dedicated employees to support your customers or a large contact center, this information and the opportunities we take from it are applicable to you. Your customers deserve attention and respect. Don’t make them feel as if their call is NOT very important to you!

Image Credit: Pexels

This article was originally published on Forbes.com

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

The Experience Nexus

1 Reply

Integrating an XMO with Customer, Employee and Partner Advisory Boards

The Experience Nexus - Integrating an XMO with Customer, Employee and Partner Advisory Boards

by Braden Kelley and Art Inteligencia

In today’s fiercely competitive landscape, merely meeting expectations isn’t enough; delivering exceptional experiences is the non-negotiable standard. Customers demand seamless, intuitive journeys. Employees seek engaging, meaningful work that fosters growth. Partners require transparent, collaborative relationships that drive mutual success. As a human-centered change and innovation thought leader, I advocate for a truly holistic approach: the Experience Management Office (XMO). However, an XMO, while powerful in its own right, truly achieves its potential when it’s synergistically integrated with the invaluable, unfiltered insights derived from Customer, Partner, and Employee Advisory Boards. This integration forms a dynamic “experience nexus” of feedback and action, ensuring that experience strategies are not just internally conceived, but genuinely co-created and reflective of the voices that matter most.

The Strategic Imperative of the Experience Management Office (XMO)

Historically, organizations managed customer experience (CX), employee experience (EX), and often partner experience (PX) in isolated silos. This fragmented approach frequently led to inconsistent experiences and missed opportunities for cross-functional improvements. The XMO emerges as the strategic orchestrator, unifying these disparate efforts under a single, cohesive umbrella. Its core mandate is to ensure consistency, proactively identify and eliminate friction points, and drive continuous improvement across all critical touchpoints for every stakeholder. An effective XMO establishes robust methodologies, deploys standardized tools, provides clear governance, and acts as a central repository for all experience data, translating raw insights into prioritized, actionable initiatives.

“An XMO, while powerful in its own right, truly achieves its potential when it’s synergistically integrated with the invaluable, unfiltered insights derived from Customer, Partner, and Employee Advisory Boards.”

Amplifying Voices: The Power of Advisory Boards

While the XMO provides the essential strategic framework and operational discipline, advisory boards inject the authentic, ground-level voice of your critical stakeholders. They offer invaluable qualitative feedback that complements quantitative data.

Customer Advisory Boards (CABs): Comprising your most engaged and influential customers, CABs provide unfiltered feedback on product utility, service delivery, and overall brand perception. They offer a direct window into evolving customer needs, emerging pain points, and often highlight competitive shifts or significant unmet market opportunities. Their strategic input can be a game-changer for product roadmaps and service enhancements.
Partner Advisory Boards (PABs): For organizations deeply reliant on a robust ecosystem of distributors, resellers, integrators, or technology alliances, PABs are indispensable. They offer critical insights into channel effectiveness, the viability of joint go-to-market strategies, and operational friction points that directly impact mutual profitability and success. A strong PAB can foster greater collaboration and loyalty.
Employee Advisory Boards (EABs): Your employees are the living embodiment of your organization’s culture and processes. They are on the front lines, experiencing internal systems and customer interactions firsthand. EABs provide invaluable, real-time feedback on workplace culture, operational inefficiencies, the effectiveness of internal tools, and the direct impact of leadership decisions on morale, productivity, and retention. They serve as both early warning systems and fertile ground for grassroots innovation within the Employee Experience (EX).

The Experience Nexus: From Feedback to Breakthrough Innovation

The true magic of this holistic model is realized when the XMO functions as the intelligent central hub, systematically receiving, synthesizing, and acting upon the rich insights generated by these diverse advisory boards (the strategic spokes). This creates a dynamic, continuous improvement loop, and crucially, an engine for genuine innovation. The XMO’s role goes beyond just operational excellence; it becomes a powerful catalyst for change. By gathering and cross-referencing insights from all three boards, the XMO can identify truly breakthrough opportunities that a siloed approach would miss. It’s in the intersection of these diverse perspectives that the most profound insights for innovation emerge.

Structured Feedback Ecosystem: The XMO establishes formalized, yet flexible, processes for advisory boards to submit feedback. This ensures insights are consistently captured, meticulously categorized, intelligently prioritized, and seamlessly routed to the most relevant internal product, service, or operational teams.
Holistic Data Synthesis & Analysis: The XMO’s analytical capabilities are crucial here. It collates and cross-references qualitative insights from the advisory boards with quantitative experience data (e.g., NPS, CSAT, CES, employee engagement scores, churn rates, partner revenue contribution). This holistic analysis identifies systemic trends, uncovers root causes, and validates hypotheses across the entire experience landscape.
Actionable Insights & Strategic Prioritization: Armed with synthesized, validated data, the XMO plays a pivotal role in guiding leadership to prioritize experience initiatives. It ensures resources and effort are strategically allocated to areas that will deliver the most significant, cross-cutting impact across customer, employee, and partner journeys, driving maximum business value.
Innovation Acceleration: This is where the nexus truly shines. The XMO facilitates cross-functional “insight sharing” workshops, where product, engineering, and design teams are exposed directly to the synthesized feedback. For example, a common pain point from a Customer Advisory Board might be the lack of a specific feature, while an Employee Advisory Board highlights a related internal operational inefficiency, and a Partner Advisory Board reveals a similar competitive gap. When these three insights are combined, they don’t just solve a single problem; they can reveal a massive market opportunity for a new product, service, or business model. The XMO’s role is to identify and champion these “aha!” moments, channeling them directly into the innovation pipeline.
Transparent Closed-Loop Communication: Perhaps most critically, the XMO champions and facilitates regular, transparent communication back to the advisory boards. This demonstrates precisely how their invaluable feedback is being utilized, outlining the tangible progress of implemented initiatives, and celebrating the impact of their contributions. This transparency is vital; it builds deep trust, reinforces the perceived value of their participation, and encourages continued engagement.

Case Study 1: Global SaaS Provider – Unifying the Ecosystem Experience

From Fragmented Insights to Integrated Ecosystem Enhancement

A global B2B SaaS company faced challenges with inconsistent product adoption and suboptimal channel partner engagement. Their existing structure meant customer feedback was managed by the CX team, HR handled employee surveys, and the partner team conducted informal check-ins. This siloed approach led to fragmented insights and disjointed solutions, impacting their overall ecosystem health.

Recognizing the need for a unified strategy, they established a dedicated Experience Management Office (XMO) reporting directly to the Chief Operating Officer. The XMO’s clear mandate was to integrate and elevate all experience initiatives. Concurrently, they formalized their existing Customer Advisory Board (CAB) and launched a new, strategically focused Partner Advisory Board (PAB). The XMO developed a comprehensive quarterly insights report, meticulously combining feedback from the CABs, PABs, and internal employee surveys. A consistent, critical theme emerged from this integrated analysis: the onboarding experience for new customers and channel partners was clunky, inconsistent, and often frustrating across different product lines.

Leveraging this precise feedback, the XMO facilitated cross-functional workshops involving product development, sales, marketing, and customer support teams. This collaborative effort led to the rapid development and deployment of a unified onboarding platform and standardized, role-based training modules. The XMO rigorously tracked key metrics such as “time-to-first-value” for new customers and partner activation rates. Within 18 months, customer satisfaction scores related to onboarding surged by 25%, and partner-led sales increased by a remarkable 15%, demonstrating the profound, tangible benefits of integrating diverse external and internal voices through a centralized, action-oriented XMO.

Key Takeaway: A centralized XMO, fed by structured CAB and PAB insights, can drive enterprise-wide improvements in critical customer and partner journeys, leading to measurable business growth.

Addressing Inherent Challenges and Ensuring Success

Integrating an XMO with robust advisory boards, while incredibly powerful, is not without its inherent hurdles. Proactive mitigation strategies are essential:

Securing Executive Buy-in: This foundational step requires senior leadership to not only champion the XMO’s creation but also to genuinely value and act upon the feedback from advisory boards. Mitigation: Develop a compelling business case, demonstrate clear ROI by linking experience improvements directly to key business outcomes (e.g., revenue growth, cost reduction, retention), and involve executives directly in initial board meetings.
Resource Allocation: Establishing, staffing, and effectively maintaining both a strategic XMO and active advisory boards demands dedicated human and financial resources. Mitigation: Start small and iterate. Begin by focusing on the most critical experience touchpoints, prove incremental value, and then scale resources as the benefits become undeniable and quantifiable.
Preventing “Feedback Fatigue”: Advisory board members are busy, valuable individuals. Ensuring they feel their time is genuinely valued and their feedback consistently leads to tangible action is paramount. Mitigation: Maintain rigorous closed-loop communication, provide transparent updates on progress, celebrate their contributions publicly, and respect their time with concise, focused agendas and clear pre-reads.
Translating Insights into Action: Moving from qualitative feedback to concrete, measurable organizational actions can be complex and requires strong analytical and change management capabilities. Mitigation: The XMO must employ robust analytics, facilitate strong cross-functional collaboration to dismantle silos, and define clear ownership for implementing improvements.

Case Study 2: Regional Retail Bank – Synergistic Employee & Customer Elevation

Transforming Branch Operations Through Integrated Feedback

A prominent regional retail bank was grappling with a concerning decline in customer satisfaction related to in-branch service, compounded by alarmingly high employee turnover, particularly among its front-line tellers. Despite various internal initiatives, leadership struggled to pinpoint the true underlying root causes of these intertwined problems.

In response, the bank strategically established an XMO reporting within its operations department. Crucially, they simultaneously launched an active Employee Advisory Board (EAB), comprising a diverse cross-section of tellers, branch managers, and key back-office support staff. The EAB quickly identified several critical pain points: severely outdated core banking software leading to protracted transaction times, unclear escalation paths for complex customer issues, and insufficient, infrequent training for new product offerings. In parallel, the bank’s existing Customer Advisory Board (CAB) provided consistent feedback echoing concerns about excessive wait times, perceived inconsistencies in service quality, and a lack of personalized interaction.

The XMO proved to be the indispensable bridge. It meticulously analyzed the EAB’s feedback on software inefficiencies and training gaps, cross-referencing it with the CAB’s complaints about wait times and service quality. This integrated analysis revealed a direct, causal correlation: internal operational friction points directly translated into poor customer experiences. The XMO then championed a high-priority, cross-departmental project to modernize the core banking software, streamline digital workflows, and introduce a comprehensive, tiered training program for all branch staff, directly based on EAB recommendations. Regular, transparent updates on progress were provided to both advisory boards, reinforcing their critical role. Within a single year, teller turnover decreased by a remarkable 20%, and customer satisfaction with in-branch service experienced a significant, measurable improvement, unequivocally validating the transformative power of integrating direct employee insights into holistic customer experience enhancements.

Key Takeaway: Integrating EAB insights with CAB feedback via an XMO reveals systemic issues, leading to co-created solutions that dramatically improve both employee and customer experiences.

Conclusion: The Future of Holistic Experience Leadership

The strategic integration of a proactive Experience Management Office with thoughtfully structured Customer, Partner, and Employee Advisory Boards represents the pinnacle of human-centered innovation and leadership. This powerful nexus creates a robust, empathetic, and continuous feedback ecosystem that not only informs and validates but also dynamically refines an organization’s entire experience strategy. It ensures that all strategic decisions and operational improvements are profoundly grounded in real-world perspectives, fostering deeper trust across all stakeholder groups, accelerating the pace of meaningful innovation, and ultimately driving sustainable, differentiated growth. For leaders aspiring to truly excel in the experience economy, this holistic, integrated approach is not merely an option—it is an undeniable imperative. It’s about orchestrating a diverse symphony of voices to create a harmonious, compelling, and continuously improving experience for everyone involved, building loyalty and advocacy from the inside out.

Contact me if you’re interested in working together to build or enhance your Experience Management Office (XMO).

Accelerate your change and transformation success

Content Authenticity Statement: The ideas are those of Braden Kelley, with a little help from Google Gemini to shape the article and create the illustrative case studies.

Image credit: Unsplash

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.