Wednesday, December 18, 2013

Digital Shift: Customer Centric Organization

It takes a few key building blocks from leadership to strategy to structure to capability in order to shape a customer-centric digital business. 

One of the key characteristics of digital organizations is customer-centricity. When companies adopt customer-centric strategies, customers become the primary drivers of “what” work should be done, “how” work should be done, and “who” should do it. Being customer centric also needs to have more organic structure than mechanic, to empower than control, to engage than command and being more dynamic than static.

Customer-centric is the description of the nature of the priorities in the organization. Organizational design is the structure -- and sometimes the strategies themselves -- that facilitate the customer-centric priority. Unless the appropriate organizational structure is continuously implemented, then "customer-centric strategy" is a buzzword.

Organizational design is the ultimate expression of the organization’s strategy - because it reflects the resource allocation and configuration of the value-creating processes. Though more often "customer-centricity" is an aspiration - it does not always get reflected in the organizational design or architecture. While that doesn’t mean organizational design sensibilities and skills aren’t important. In addition, with the emerging technologies such as social platform, the cross-functional collaboration or customer engagement cross business boundary is the new normal for being customer-centric.

Customer-centric Organizational Design has to be much more “organic” in the sense that it’s melded with the process and even technology (how customer-related data should be managed and on which systems often has significant organizational repercussions). In customer-driven Organizational Design, the most important internal players are those understanding the “what,” “how,” and “who” – plus the “why.” Technical Organizational Design knowledge may play a support role, but it’s not at the forefront, whichever group is shaping the strategy for an organization has a strong understanding of the organizational architecture and design.

The process, Structure, Behavior and self-interest of individuals and groups -all these factors interact in a dynamic: At times latent ways and powerfully impact the direction and outcome of the transitions. It's like a circle. Re-designed processes may require behaviors that may be again out of comfort zone. Structural changes may also be necessitated based on extent and spread of re-design of processes.

The structure of the organization is varying: Whether it's "organic" or whether there should be a corporate function of Organizational Design, all depends on the culture of the organization, its life cycle and extent of rapid change outside the organization. There’s a pendulum swinging between people and process, engagement and efficiency, in order to adapt to the spiral change facing in organizations. The problem usually is that when change is planned, the focus goes over to improving the process and sometimes one may forget that the real change has to come from the way people adopt new ways of thinking... and only then, new ways of working.

Being customer-centric is a transcendent digital trait and core of corporate strategy in today’s digital organizations, an organic organizational structure that is melded with process and technology can sustain strategy and accelerate execution. It is the bridge to connect from serving the customer to being customer centric.


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