25 Years of Customer Pioneering - The Foundation, a quarter of a century in
Our Founding Partner, Charlie Dawson, reflects on the last 25 years - the progress made and biggest learning points.
On October 1st 2024 The Foundation was officially 25 years old. It’s hard to comprehend how much has changed and what’s been learned over such a long time, despite having seen the whole journey first-hand.
The customer world 25 years ago
The big deal in October 1999 was the internet. We were in the middle of the original boom – or bubble as it came to be known.
The biggest internet businesses included AOL, who grew by sending people CDs in the post to help them connect, and Yahoo, who had a person updating a web page every day listing all the new internet sites that had set up in the last 24 hours.
Amazon’s results for 1999 expressed pride that book sales were now less than 50% of their revenue, and that they had won awards for their toy business, something they envisaged being a big part of their future
Apple launched a spaceship-shaped device aiming to set the standard for wireless communications, that they explained could be abbreviated to ‘wi-fi’. The iPhone wouldn’t arrive until 2007.
Kingfisher announced a brand new out of town megastore format called Big W, a giant Woolworths. Trading in Woolworths shares was suspended in 2008.
In the world of music, Napster launched, allowing free digital music file-sharing. It was described as the year the music industry lost control. And iTunes then Spotify were yet to come.
Google only entered the UK top 10 for websites in 2001.
People at work asked things like ‘can I find someone to teach me the internet?’ (They couldn’t)
Our world 25 years ago
I had a lot more hair then. Slightly too much I now think.
I’d spent five years already thinking about the idea that became The Foundation, ever since working on advertising for the launch of Daewoo Cars in the UK. It was groundbreaking stuff. We saw something many car buyers wanted but weren’t getting – decent service – and with the management team doing the heaviest lifting, responded boldly through a whole different business model (directly owned distribution) and culture (belief in putting customers first and that sales would follow), encouraged by the burning ambition of the Koreans who wanted serious success only. Cautious safety in their eyes was failure.
The Foundation would repeat this way of thinking – making things better for customers of many different businesses by identifying both customers’ unmet needs and an innovative, viable business response. We would understand both customer and business parts of the challenge.
This seemed to be a way of creating strong foundations for sustained success – hence the name.
The service sector had been growing and it seemed that these businesses had more need than pure product companies to co-ordinate and orchestrate to create a good customer impression. More of their operations were visible and were experienced by customers. They were very different to a box of cornflakes where the customer bit could be more easily handled separately from most of the business.
But this idea of managing customers’ experiences wasn’t established.
There were no CX teams
No Chief Customer Officers
No NPS even – that came in 2003, announced by a seminal article in Harvard Business Review
We had no idea how to describe ourselves. Our first brochure had on the front cover the headline ‘We are management consultants. We are not management consultants’. Awful!, Inside-out and self-interested, entirely unclear, reflective of a conversation at the time about ad agencies being in competition with management consultancies.
We also had little idea of how to do our work, how to sell it or who we needed to recruit to carry it all out.
We attracted 10 clients in our first year, half of which were dot com related (the boom really helped) and they included the Department of Education and Skills, NME and, thankfully, Volkswagen. A year in, the bubble burst. Although no one emails you to tell you. It all just slows down and you go from worrying about speed of growth to worrying about the blip to worrying about survival, bit by bit. Volkswagen asked for help with two projects that lasted for more than a year, and so once we had painfully cut back, we started to learn how to do this work for real.
To save you a blow by blow account, the biggest learning points in 25 years can be summarised in a list of five.
That the first and most fundamental challenge for anyone in doing customer-centric things well is perspective. You naturally see the world from the inside looking out, colleagues close, customers distant and quiet. But to do better for customers, you need to see things outside-in, starting with them and their very different worlds, and working gradually back to your sector and eventually to you, who you now remember is an organisation that’s extremely unimportant to them and often misunderstood too.
Two definitions are crucial.... ‘Customer’ is an imperfect word. Much breath is wasted in various sectors debating whether it’s better or worse than consumer, shopper, audience, passenger, resident, tenant, citizen, even human (and more). They are all imperfect. The longer more helpful idea is to think about ‘the people you serve’. The buyers, the users, the people around them, their communities, and the world they live in. The whole lot. But most pointedly, the people who, in the short term and in the long run, whose decisions you need to earn for you to succeed.... Being customer-led isn’t asking what they want and doing what they say – as customers we only know what we’ve always had – faster horses and all that. It is doing two things together – really understanding the problems customers need to solve or the outcomes they want, and then finding new and better solutions. The first of these is timeless – we want to get from A to B, to buy good food at affordable prices, to be entertained, to wear clothes that make us feel confident or attractive. The second, the new and better ways, changes all the time. At some point you create the best possible solution, and you scale it. Eventually someone else comes along, maybe with a new piece of technology, that allows a genuinely better solution to be created. As the incumbent, you’re busy running your machine, not thinking about customers and their original problem. Maybe you’re the BBC and Netflix starts, looking insignificant. But they bring a way of watching what you want when you want to that’s a new and better solution. You miss it and it grows. Once it’s significant there’s a completely new issue, because now they’re really good at things you’ve not had to deal with. To be fair, the BBC did have the iPlayer and were onto it fast, but Netflix has definitely done better. This is why these definitions matter.
In helping leaders do a better job of this, we learned that this is not an information problem. It’s about belief. Initially we thought it was information – getting customer insight in front of people from all across a business. But when that insight, and the market researcher who conveys it, tells you stuff that’s seriously inconvenient – like you’re losing share to Netflix in a way that looks serious – the information gets ignored. And if a few brave souls start to engage with it, then believing that their organisation could do something very different, successfully, is just too hard. It would have to be a collective effort, involving all manner of changes, doing wholly new things well.
There’s a powerful way of instilling these kinds of beliefs that we call Immersion. Immersion is about senior people making time to do two types of activity... Meeting and listening to a few customers directly, in person. This brings businesspeople into the real world, face to face with someone who might be angry or confused or just uninterested, but its personal. You can’t ignore it, you have to think about why. And you want to do something about it too as you start to see, and more importantly feel, why it matters and why perhaps your numbers have been going in the wrong direction.... And then alongside, meeting and listening to a few leaders of organisations in other sectors who have successfully tackled challenges with some similarities but lots of differences to your own. We call them Parallels. When you hear the story from someone who was really there, it’s obviously authentic. And you can also ask them directly what went wrong, what it cost, what they’d do differently next time. It’s not threatening because it’s a story about what someone else did, distant from you. But it leaves space for a team of leaders to let pennies drop. It IS like us a bit, and if they were here then they’d definitely do x, y and z. Hang on, we could do a version of that. Put together a few complementary parallels and you start to have new set of jigsaw pieces that describe a very different picture of a successful future, new and better ways of solving the inconvenient customer problems, one that the team believes in and owns.
Gradually we learned how to apply all this to more specific client questions, taking the principles into better specific answers.... Creating strategy that’s led by customers, outward-looking, outside-in – or developing customer strategies, choices about who to serve and which needs to meet... Developing more rounded and innovative propositions, promises you can deliver that make things better for customers first, and that earn their decisions as a result... Building visions of what your particular great customer experience looks like across the organisation (great for customers first, not the organisation first), and then systematic ways of measuring, managing and continually improving towards the ideal (informed by John Sills’ great book, The Human Experience)... Ways of changing whole organisations so they become genuinely customer centric, maybe even pioneering, building on learning from my own time writing the book The Customer Copernicus
25 years on, are customers in a better place?
In many ways yes. And in many ways no.
Last year we carried out a State of the Nation study into what we as customers of many, many organisations, experience on a regular basis. Our lives depend on the support we receive.
We looked at 44 categories surrounding us as people and asked how they are experienced – from brilliant and wonderful to awful and enraging.
The world of the internet, digital, mobile did well on the whole, seriously helping by making thing easier and more enjoyable. Amazon, Netflix, Apple…
But customers are NOT being well served in far too many areas of life, across many sectors and organisations:
Things don’t work – the NHS and trains stood out
It’s very hard to get in touch to sort stuff out – HMRC for example
You waste my time – maybe Ryanair with all the tricks and friction with trying to book, or many, many call centres where your call is important to them but not enough to answer it within the hour
And it takes an emotional toll. It’s stressful being let down in areas that really matter, or having something unjust happen that you can’t speak to anyone sympathetic about to make it right
This is a national problem, an invisible epidemic contributing to depression, misery and a lack of productivity on a personal level.
Why is it still so bad?
To be fair, the issues in organisations are pretty intractable.
Teams have to be created to work at scale, and they only see their part, in silos
Self-interested aims and metrics are commonplace and unquestioned, the norm – but they’re about how to make this organisation successful not the people it serves
Attention is continually pulled inwards by the clamour of colleagues, regulators, owners and more, with customers quiet and far away
There are some great customer pioneers out there, but there’s a lot more that needs to be better.
Where to from here?
We’re doing all this because we want to make a difference.
We’ve stayed independent so we don’t get distracted from the task in hand.
But we want to enlist more people in helping to make the changes that society needs.
We should have not just outside-in businesses but outside-in public services, charities, political parties… they all fall into the same trap.
To help, we’re determinedly growing a Customer Pioneer Community, a group of like-minded people who want the world to be more of this kind of customer-led.
At its heart is a group of Mountaineers as we call them – currently more than 50 people who have been part of leadership teams that have successfully pioneered, making things better for customers, against the odds in all sorts of different situations, sectors and at different sizes. You can see who they are here.
By sharing their stories and their learning with people across the community, and by people across the community supporting each other, and with us supporting and keeping the flame burning, we think we can make a difference at a new scale.
The next five years are about building momentum… Maybe the next 25 years making more of a dent in the problem.
Let’s make organisations serving the people they’re there for exceptionally well, commonplace.
Let’s create more Customer Pioneers.