4 traits of high-performing companies
High-performing companies have figured out ways to separate themselves from their peers. One key difference is a sharp focus on customers; another is a focus on employees.
Yet 57% of companies concede that they have not always kept commitments to employees, and 33% admit failing to keep promises made to customers. That’s according to a global survey of 1,333 organisations conducted by the American Management Association and the Institute for Corporate Productivity.
“Companies may feel free to concentrate on customers, while at the same time taking employees for granted,” Sam Davis, vice president of AMA’s corporate sales, said in a news release. “But our research found a strong correlation between keeping commitments to workers and to customers. As a rule, companies committed to their workforce also score higher on customer focus and satisfaction. In fact, these qualities tend to distinguish successful companies from their competitors.”
There is a tie-in between strong customer and employee engagement, because in many cases, customers are interacting directly with a company’s workers. If those workers “don’t have a genuine customer focus, the business is going to suffer,” Davis said.
The report highlighted several companies that have exhibited strong customer focus when confronted with an obstacle and turned that focus into financial success. One example was Domino’s Pizza, the delivery chain that suffered a reputational crisis when an unflattering YouTube video was posted by employees in 2009. Domino’s began focusing more on customers and repairing its relationship with them.
The report listed four key findings that separate high-performing organisations from competitors. High-performing companies are singled out in the report on the basis of revenue growth, profitability, market share, and customer satisfaction.
- Customer alignment starts high and runs deep. The behaviours of executives support customer focus in high-performance organisations, and the practice is drilled down to include the behaviours of middle managers, too. The report found that executives in high-performance organisations are nearly three times more likely to support successful execution of customer-focus strategy than executives in lower-performing organisations. Leadership involvement includes crafting a formal strategy, setting clear goals for customer satisfaction, and aligning internal systems and processes with the needs of the customer.
- Customer satisfaction is good, but customer advocacy is better. Satisfaction is the global standard for measuring customer focus, but high performers recognise that active, engaged customers are the gold standard. They value feedback from customers in the form of online surveys, but they also cherish the customer referral. In the era of social media, high performers want customers who buy the products, then tell their friends.
- Customer focus is data driven. In the age of Big Data and evidence-based business activity, high-performance organisations use customer insights, shared organisation-wide, to shape products, services, and strategy. High-performing organisations are 2.5 times more likely than lower-performing peers to regularly collect data that reflects customer satisfaction levels, the survey found.
- Technologies enable customer connections. From customer relationship management (CRM) software to social media, high performers put technology to good use to better connect with customers worldwide. For example, 57% of high-performing organisations use CRM software, nearly twice the rate of lower performers that use it. High performers, the report said, “demonstrated the power inherent in not just soliciting customer feedback, but in listening to it, acting on it, and promoting customers’ hands-on participation.”
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“The 50 Most Innovative Companies and the Habits That Distinguish Breakthrough Innovators”: Boston Consulting Group lists the habits that distinguish breakthrough innovators. Find out which company is the most innovative.
—Neil Amato (firstname.lastname@example.org) is a CGMA Magazine senior editor.