” “Nobody really puts customers first,” Arthur Levitt, the former chairman of the Securities and Exchange Commission and now a policy advisor for Goldman Sachs, told Bloomberg TV Thursday.” – Huffington Post
When I heard Arthur Levitt say this sentence during a Bloomberg interview recently, my head whipped around so quickly to watch his interview that I think I literally experienced string theory at that fractal moment.
I was shocked, floored, and then curious about why such an accomplished man who has a strong reputation for fighting corporate greed would say something so against everything he stands for along with what I and thousands of my professional CX colleagues stand for and get paid to focus on.
As a note, Arthur Levitt published Take On the Street: What Wall Street and Corporate America Don’t Want You to Know in which he describes the current state of affairs in the financial markets along with giving investors advice on how to avoid catastrophes.
Let’s dissect this and let’s assume that his comments on Bloomberg were related to regulators, bankers, and CxOs of public companies (in general), not to his own beliefs or recommendations.
First, his language – the infamous five words:
- Nobody – cannot be statistically true (refer to simple math or Six Sigma or rocket science here – whichever you choose). And who exactly would the nobodies be? CxOs, Directors, Bankers, Social Workers, Government entities, our Regulatory Agencies, Insurers, Non-profits, or almost everyone? Need some clarification here as this could simply be an expression of his disgust or frustration or that he believes a very high percentage of people (bankers, regulators, and CxOs of public companies) are prone to this behavior.
- Really – as in likelihood or as in only fakes it on the outside?
- Puts – no issue with this word by itself.
- Customers – end-user customers, business customers, consumer customers, government customers, social services customers, banking customers, the people who pay for goods, services, and CxO’s salary customers?
- First – as in above or in front of all else or as in at the forefront of decision-making?
Second, place these five words in a simple sentence and his thoughts could be interpreted several ways such as:
- Nobody that I know (meaning Levitt re: regulators and bankers) actually talks about customers. They all talk about money, how to get more money, how not to lose money, how to increase or decrease regulations, and/or how to push the limits of regulations, all to accomplish the aforementioned money-related goals. At no time do they talk about the people who provide them with said money because well, who knows why!??! Maybe they think that money really comes from the Fed printing it out 24×7 365 days/yr. Sort of like kids who think that pork chops come from their local grocery store.
- They haven’t a clue what CxOs talk about or focus on these days because all anyone talks about in his circle (again, regulators and bankers) is money, so they have the impression that customers don’t matter. If you don’t SEE customers, then they must not exist!
- Every person in the World that has a job focused on customers – whether making products/services, innovating, marketing and/or selling same, servicing same, and invoicing/collecting for same – has a meaningless job. Remember that ‘nobody’ really puts customers first. We must be nobodies, right?
- Every vision statement, corporate culture, bonding event, corporate social responsibility activity, and career path is a sham. That the ONLY thing that matters is money because customers (and one could generally assume societies, families, etc.) aren’t number one – EVER. Hmmm… this might infer that we have legions of pathology that run these agencies/companies.
- Every website is wrong. Better get cracking rewriting those web landing pages to say something like “We know you exist Mr./Ms. Customer because you keep calling us and annoying us with those calls. If you’d just buy our products or conduct your trade on-line and leave us alone to count our money, that would be great. Thanks for helping us reduce our overhead!”
- Executives that only focus on regulatory and money are the only ‘somebodies’ that matter.
- They have tunnel vision and may very well be bona fide narcissists.
- The only thing that matters is share price. As long as the C-team can improve share price – no matter the method used to do so – then all is well in the World.
Mr. Levitt goes on to say (in relation to an ex-employee’s claim that Goldman Sachs does not focus on customers) “Let’s not create a fellowship between buyers and sellers which will march into the sunset.” I worked at Arthur Andersen when the Enron meltdown occured, so I can understand his regulatory perspective. However, most companies try very hard to collect data and feedback from customers so as to strengthen the relationship – creating collaborative fellowships as it were – so Mr. Levitt, you may have to refine this sentence to include only highly regulated industries such as financial institutions, auditors, legal firms, and the like.
For disclosure purposes, I am not an auditor nor did I have any involvement with Enron.
As a sidebar from the Goldman Sachs 2011 Annual Report…
“Without raising capital, how can a promising company expect to fuel essential innovation?
Without managing risk, how can a business run smoothly, or an investor confidently look ahead?
The answer is, they can’t.
And that’s where we come in.
Across the globe, our job is to help our clients succeed at critical moments. And their success benefits all of society, not in the abstract, but in the very real world.”
Yes we all get it and agree; businesses are in business to make money and I have no Pollyanna-like delusions about this goal. Some businesses have the added charter of contributing to society and communities, but I doubt that many of those are SEC registered corporations.
As CX leaders, we experience this laser-like focus on share price/profits and attempt to bridge the divide, advocating on behalf of customers by using things like NPS, Net Effort, C-Sat scores, etc., an effort that intuitively seems like it could be easier, but numbers are important. What doesn’t get measured doesn’t improve, right?
We work everyday advising our CxOs on customer feedback while recommending action plans ALONG with the financials. It’s not a zero sum game and it has been proven ad nauseam that there is a direct correlation between customers, processes, technology, and profits.
“What’s the ROI?” We hear that question – all too often. We all understand that we need to justify spending company money in some way, but when this question is meant to shoot down ideas, it becomes combative and non-productive. We’d far prefer talking about adding value than positioning CX as an expense.
The simple days of a customer calling to place an order, inquire about an order, ask questions about an order, or make a payment are gone. Investments in technology, people, training, and ***GASP*** social media are now the cost of doing business. No different than buying telephones or headsets, pens and paper back in the day. And at the pace of current changes, back in the day could easily mean just a few years ago, not the 1970s.
A Customer Experience Tipping Point is happening as we speak. Transparency and social media combined are empowering really smart and really angry customers to become vocal. These customers and the customers they influence will leave a business in a nano-second if they for one minute hear, see, or experience a company’s hypocrisy; and that’s after they have blasted their negative opinions about the company to the entire World via Twitter or blogged about it or even posted confidential information about the company on Glassdoor, Wikileaks, or other advocacy sites. Power and control are shifting – fast.
Focusing on share price/profits to the detriment of people is a strategy, when taken too far, can ignite the negative passions of customers, employees, and stockholders. There must be a balance and if not maintained, could actually be the sign post for public companies to start failing. This also applies to governments and citizens – or voters as we are all called by politicians. Angry citizens who experience hypocrisy and greed all over the World are revolting; the über Customer Experience Officer is the President/Leader of each country. Should we now eliminate the Chief Executive Officer role and replace it with Chief Experience Officer in companies?
The same Tipping Point is mandating that internal silos, internal politics, employee rankings, and misaligned, secret bonus plans be stopped immediately. If the inside of a company isn’t aligned to provide top-notch customer experiences at every customer touch point, the company can officially change its vision statement to ‘We want to be the best pterodactyl in the World.’ And yes, culture change starts from the top and is sustained from the top.
Strap on your leadership seatbelts because it’s going to be a bumpy ride! How many public companies or investment firms that focus primarily on share price/profits are going to be able to change fast? Should they all watch “The Titanic” again, but this time the ship represents their companies? What new breed of leader do these organizations need and how can Boards put a stop to the exclusive pursuit of share price/profits for executive compensation? All tough questions and some in direct opposition to current Board charters.
EVERY JOB IS A CUSTOMER SERVICE JOB
Everyone on the planet reports to someone, trying to please and/or service them in some way in order to gain mutual benefit. Marriages, families, friends, study groups, spiritual groups, business transactions, company mergers, lawyers defending clients, auditors conducting audits, customer service reps speaking with customers on the phone or via e-mail or on a Facebook page, helping your mother and father, raising your children, the CEO reporting to the Board or analysts,…
EVERY JOB – WHETHER PERSONAL OR PROFESSIONAL – IS A CUSTOMER SERVICE JOB
That means even the regulatory guys, finance guys, politicians, and CxOs. They are servicing someone somewhere at all times – whether they acknowledge it or not. Yes, you are all customer service reps. and you should rethink your opinions about customers. If you don’t I guarantee that your customers will leave you too no matter what you say in your annual reports about how important customers or clients are to you.
You see, the issue isn’t that ‘nobody really puts customer first’ (although it is possible that some public company and financial institutions’ leaders might think and act like this), it is that every CxO should be eagerly asking their entire organization ‘How can we service customers BETTER’. It is the company leader who asks this question relentlessly of his/her teams that is winning the game and attracting loyal customers legitimately and sustainably. It is those companies that are driving the Customer Experience Tipping Points mentioned earlier, and the ones that Goldman is now being compared to. That’s the thing about best practices; once someone provides fabulous service, EVERY company is expected by customers to deliver the same or better no matter if they are in the same industry or not.
And even if businesses are in business to make money, without customers (people) the business simply doesn’t exist, does it? Money is the outcome of providing fabulous products and services that people need, want, and buy repeatedly; a beautiful symbiotic relationship.
What a sad, infuriating, nuanced, and eye opening indictment Arthur Levitt leveled at regulators, bankers, and some public company CxOs when he said those five words; “Nobody Really Puts Customers First’.
How interesting that the Customer Experience Tipping Point is happening everywhere; both in public and private sectors, and in societies globally. There are no coincidences, as some gurus say.
I’ll end today with a few quotes from Huffington Post readers related to the original Levitt article. And to all of my CX/CS Leader colleagues, stay the course!
Back in the 1950’s my father owned a neighborhood grocery store. Since the store was family owned, we ALL had to work in the place, putting long hours, sacrificing our weekends, and having very little time off to spend as a family. However, we all realized that the place was OUR “bread and butter” and to make it continue operating, we relied on CUSTOMERS to come in the door and spend money.My father’s business ethic was simple: Keep you customer base happy and be FAIR to all your customers and the business survives. Tick off just ONE customer and you have ticked off 10 or more POTENTIAL customers as well.Today, you don’t hear that ethic anymore. It’s keep the STOCKHOLDERS happy, and to H-E-L-L with your customers..ronald godzinskiThis is the problem with the new capitalist philosophy of doing business today. I was taught at the university level that you have to be better than your competitor. In today’s business world the corporations feel you should kiss their ass to do business with them! The CEO of a large capital fund that controls one of the top ten retail stores told his people we only have to be as good as our competition! You all have tried to get to connect with customer service, right! How many prompts do you go through and how long do you wait! Your time means nothing especially if it’s a warranty problem! Unfortunately this has become the american way of doing business especially with major big companies. Good luck to our future..
stopthemadness69Wrong, sir, Small businesses, real small ones, not Koch brothers small businesses or attorneys offices, but actual mom and pop small businesses, do put their customers first. Our business does. We have even forgone our pay during certain months of the recession in order to keep ordering product so we could serve our customers. Greedy corporations who only care about maximizing fast profits may not, but businesses that feel some sort of responsibility and belonging to their community, do.
“Disdain for FUD (Fear, Uncertainty, and Doubt) – and for the type of person who tends to experience it (meaning introverts or thinkers) – is what helped cause the crash, says Boykin Curry, a managing director of the investment firm Eagle Capital, who had front-row seats to the 2008 meltdown. Too much power was concentrated in the hands of aggressive risk-takers. ‘For twenty years, the DNA of nearly every financial institution… morphed dangerously,’ he told Newsweek magazine at the height of the crash. ‘Each time someone at the table pressed for more leverage and more risk, the next few years proved them “right.” These people were emboldened, they were promoted and they gained control of ever more capital. Meanwhile, anyone in power who hesitated, who argued for caution, was proved “wrong.” They lost their hold on capital. This happened every day in almost every financial institution, over and over, until we ended up with a very specific kind of person running things..People with certain personality types got control of capital and institutions and power,’ Curry told me (Cain). ‘And people who are congenitally more cautious and introverted and statistical in their thinking became discredited and pushed aside.’ “