Article: CEO's new role aligning HR with customers

Strategic HR

CEO's new role aligning HR with customers

CEOs must directly engage with customers to receive useful insights on their needs and support HR to instill customer-centricity within the company
CEO's new role aligning HR with customers

Today's customer is an altogether different species, surely not one who would suffer sub-standard quality of products and services


Employee appraisal systems do not emphasise on the accountability for customer interactions and therefore, customer issues take a back seat


CEOs are normally known to make grand statements about customers such as ‘customer is the boss’, ‘we exist for customers’, etc. Sloganeering for customers and employees in fact competes. If you enter any corporate office, one is confronted with a grand vision of the company with the company’s pronounced commitment to customers and employees. But, the stark reality is that customers or employees are hardly discussed in boardrooms. The Board has bigger agenda to discuss! But the hard fact is that organizations today can ill afford to ignore either.

In large and geographically dispersed organizations, approach to the customer is not limited to intent alone and lies on how we convert a good intent into a culture that permeates across the organization. The very survival of a business today hinges almost entirely on the customer. It is well-known that today’s customer is an altogether different species, surely not one who would suffer sub-standard quality of products and services or live with delays or any mishandling. Therefore, there is a clear need to focus on ensuring high internal sensitivity towards good quality products, speedy service and a listening management. Large organizations require appropriate structures to support such intent. A centralized customer service department meant to collect complaints and produce some internal reports is an out-of-date arrangement. One of the key roles of the CEO is to create an internal culture that makes executives accountable at every level to customer issues. It requires investment in training and sensitizing of people, especially in the front line, to prepare them to deal with customer interactions with empathy, grace, dignity and professional competence.

To build long-term loyalty with customers, organizations have to ensure easy access to customers by empathetic problem solving and willingness to change the rigid policies and structures. Technology is making it possible today to reach out to the customers, interact with them and solve customer’s problems on real-time basis. Increased interaction with customers can help in getting useful insights from customers in designing new products. The question is, do we do all this?

Today, CEOs need to reach out and travel extensively to visit customers’ places and engage them. I have even heard of some CEOs marking certain number of days in their diary, in a month, exclusively for customer meetings in different locations. I understood the value of customer interface when Azim Premji of Wipro called on me while I was CMD of Dena Bank, to gain feedback about the working of some computers that Wipro had supplied. Although Dena Bank was a small customer of Wipro, Premji’s visit to Dena Bank created lot of goodwill for Wipro in Dena Bank. The CEO, meeting the customers, encourages managerial level down the line to initiate such meetings and helps to promote a customer-centric culture in the organization. In Bank of Baroda, much of our transformation, growth and organizational changes, were dictated by the needs of the customers.

Many CEOs have designed experiential engagements to create unique memorable experiences, which will appeal to the individual in each customer. One organization engaged their customers by arranging a live dialog with the noted author Thomas L. Friedman. James Joseph, Director, Customer Engagement, Microsoft, who extensively used experiential engagement with his customers observes:

‘‘Once I had to host a meeting for a group of senior finance executives (my potential customers) who were already in Kuala Lumpur for a conference. Topic of my meeting was the ‘Economics of cloud computing’. I moved the meeting to the 42nd floor of the landmark building Petronas Towers, where the customers were literally in the cloud! Customers had the memorable experience of seeing a great landmark and experience a venue which is not open to the public and learn about cloud computing by being in the cloud! This experience was rated as the highlight of the conference.”

In big corporations, in spite of the best intentions, customer issues often get lost in hierarchical jungles. Moreover, the employee appraisal systems do not adequately emphasize on the accountability for customer interactions and therefore, customer issues take a back seat unwittingly, quite contrary to the intent of the CEO. The following tenets can aid in establishing lasting customer relationship engagements:

CEO hotline: A dedicated hotline and email ID to the CEO can help in gaining some shocking ground realities which can help the CEO undertake some major steps. On the eve of the centenary year celebration of the bank in 2007-08, we used the slogan “Hundred years of banking with passion”, in our advertisements. An irate lady customer challenged us by sending a mail on my hotline that the bank’s tagline should be “Hundred years of banking with patience”. We later found that she could not get her registration for the internet banking facility even after 2 months of making the request. Internal investigation revealed that about thousand applications were pending for registration on account of our internal problems, which were not brought to my notice by the concerned functionary. The CEO hotline helped me fix problems at various touch points.

Listen to frontline: The frequency of customer interaction is highest at the frontline level. In one such interaction, a young lady staff member shared an insight on how our car loan policy was acting as dampener in retaining our SME customers who were enticed by private banks.

Granularity for customer service: Every organization has some system for customers to reach out to the management, however, the important questions to ask are:

How is our helpline working?
How is our call center functioning?
How is our helpdesk response?
How are the customer survey results used?
What is the frequency and content of our customer service programs?
How often do we discuss customer issues in the Board?
How does mystery shopping work?
What is the reward mechanism?

A key role of the CEO is to continuously create a culture of innovation in products and processes which often represents the aspirations of the customers. At BOB, we introduced many customer-centric innovations like 8 am to 8 pm banking, gen-next branches, retail loan factories, SME loan factories, etc. This led to adding 8 million new customers in 2005-08 which was possible because we spent about 25 percent of our time on customers.

Feedback from customers’ about services and products has profound implications on our human resource policies such as training, appraisal, leadership, to mention a few. When customers are included in the HR portfolio, it improves the credibility of HR functions as HR is directly aligned to business issues. I tested it successfully by combining the functions of HR and marketing in the bank. For HR’s successful integration with business, its knowledge about customer issues is vital and CEOs need to align their HR function to customer engagement issues.

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Topics: Strategic HR, C-Suite

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