Know What They Want
- 03 July, 2008 14:00
Part 7 of CXO Priorities | THE CUSTOMER
As Australia's premier commercial airport, Sydney Airport facilitates the travel of 31 million passengers every year. It takes the collective actions and processes of some 500 businesses and organizations to meet the needs of the airport users at this dynamic economic hub. The airport is also one of Sydney's major employers, directly providing an estimated 75,580 full- and part-time jobs, and an annual contribution to NSW's Gross State Product estimated to be $16.5 billion. As such its business stakeholders, says Sydney Airport Corporation Limited CIO David Luong, consider provision of world-class technology-enabled solutions and service a business imperative.
Luong says Sydney Airport Corporation simply couldn't operate an efficient, safe and secure airport delivering world-class first and last impressions to transiting travellers without having a deep and continually updated understanding of customers' changing needs and expectations.
"In order to be continually focused on understanding customer needs and how the airport can provide effective and innovative service offerings to 'delight' our customers, we expend a high proportion of our effort on engaging and consulting with existing and potential new customers on their needs and finding ways we can satisfy or exceed those needs," Luong says. "This high level of customer focus is promulgated from the CEO through to all levels of our employees. We encourage managers and employees to be involved in cross-functional and cross-industry workgroups to enhance ways in which to satisfy our customer needs and expectations. These workgroups range from airport-based operational and project consultation sessions through to cross-companies workgroups servicing industry bodies such as Airport Council International (ACI) and International Air Transport Association (IATA).
"Often it is the case that innovative customer services offerings are discovered through profound empathy for and caring observations of the customers' needs. Within the last 20 months, Sydney Airport launched two innovative services in its relentless pursuit of delighting its customers," Luong says.
The two new services are a Live Flight update service via SMS allowing travellers and service providers to receive instant flight information updates by simply texting the flight number to 199-00-747; and provision of a wireless system to enable one of the airport's premier domestic airline customers to update the contents of its digital in-flight entertainment video systems while its aircraft are within the airport's aprons and aerobridges.
"Such relentless focus on understanding and delivering on customer expectations and delighting their needs contributes to the positive reputation of the airport," Luong says.
In August 2007, Sydney Airport was named the best airport in the Australia/Pacific region by the Skytrax passenger survey, while in September it was named in the top 10 airports in the world (with a ranking of seventh - up three places from 2006) by the Conde Nast Traveller Reader's Awards.
Of course delighting the customer is impossible without an intimate understanding of that customer. Sometimes, CIOs concede, that can best be gained by stepping outside the IT role for a time. During the course of his career, NineMSN COO Nick Spooner has worked in several major organizations both in the UK and Australia, and in a range of executive and non-executive roles bridging both technology and commercial aspects of the business. He thinks CIOs looking to delight the customer do best when they have such broad experience to draw on.
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"I've been fortunate enough to take the technology awareness and experience that I've had, and then complement that with the product and the program experience and the business experience and then brought that all together to perform this role," he says. Being able to draw in product experience, program management experience, IT and technology experience and commercial experience helps him gain a unique understanding of the needs and wants of the average customer, Spooner says. "If you get a combination of all of those, it's pretty powerful and enables you to really operate at that executive level without being focused, like a CIO, on one particular niche area."
Spooner says for CIOs without such a broad range of experiences, understanding customer expectation means learning to understand all the drivers of the business, and doing everything possible to develop commercial and business awareness. "At the end of the day it's about understanding what our audience needs are, understanding then the translation of those into business requirements, and then finding out what technology or IT must be delivered to enable and support those," Spooner says.
"We've used a number of different sources from direct customer feedback to market awareness and market insights to competitive behaviour. We look at all of those things to see how they relate and how they influence our business. I then take that and translate that into: Okay what do we need to do as a business? What does that mean in terms of products? What does that mean we need to do in terms of customer offerings? And only then do I look at it from an IT or a technology perspective."
Some organizations obsessively survey their customers and imagine that's all they really need to do, Spooner says, rather than spending time translating that understanding into strategy. Being too technology focused or technology led is dangerous if it leads you to deliver brilliant technology that still fails to support and deliver customer expectations. It's the translation of that awareness into strategy, drawn up against an understanding of all the drivers in the business, not just the technology drivers, that matters, Spooner says.
Business is all about customers, notes AGIMO Division Manager Patrick Callioni. Without customers there is no business, no matter how good your business processes, technology, cost control and resource management. A CIO who understands the organization's customers is much more likely to be able to assist the business to respond to or preferably, anticipate what needs to be done to satisfy the customer.
"Assessing and managing risk is important because it provides context for the decisions a CIO has to make in balancing the requirements of the internal client (the business) and the (external) customer. Doing this right requires CIOs to consider and manage many factors, often competing with one another for attention and for resources," Callioni says. "The CIO has to assist the business to succeed without falling into the trap of thinking that she or he knows the business better than the managers responsible for it, while, at the same time, preventing those managers from deluding themselves that they know all there is to know about the potential of technology to support business objectives."
Callioni says using industry standards for risk management (AS 4360) can help the CIO and the business to engage in a constructive dialogue about the linkage between the technology and business processes, by providing a common language and tool set. Similarly, by developing a common understanding of the risk and opportunity environment for the business as a whole, including technology, the CIO can work with management to shape complementary strategies and action plans.
"This is a simple solution that is hard to implement," Callioni says. "It is hard to implement because most managers, including CIOs, treat risk assessment and management as a tick and flick exercise, rather than using it as the powerful strategic and management tool it is designed to be. Once this cultural barrier is overcome, AS 4360 is easy to use and does not require the organization to bring in expensive consultants. In fact, using a standards-based approach to risk management may help the organization avoid the need to bring in consultants to solve strategic or business design problems."
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Sidebar | A Philosophical Difference
When it comes to CRM strategy, a focus on customer value is essential, says Cutter Consortium senior consultant Stephen J Andriole. Different customers have to be treated differently, using variables like customer ranking, actual value and potential value as strategy drivers.
"Several commercial software packages are available which vary in their approach to [what is generally known as] CRM," Andriole notes. "However, CRM is not just a technology, but rather a holistic approach to an organization's philosophy in dealing with its customers. This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. CRM therefore also needs to consider broader organizational requirements."
Andriole recommends all such investments in master data management (MDM), business intelligence (BI), and customer analytics /customer relationship management (CA/CRM) should be purposeful, with investments in MDM and BI made after the CA/CRM strategy is developed.
He says CA/CRM strategic and operational objectives should include the ability to:
- Identify and integrate customer data across applications and lines of business
- Securely store master and redundant copies of all customer data
- Profile customer behaviour over time with patterns and trends
- Cross-sell across business units and products and services
- Up-sell existing customers with additional and more profitable products and services
- Develop customer acquisition and retention campaigns
- "Touch" customers physically and digitally based on analysis and receipt of preferences
- Build whole customer management and customer lifecycles that can be monetized over time
- Customize and personalize products and services
- Develop financial models of individual and classes of customers that yield specific cash-flow forecasts, cost management strategies, and overall revenue/profitability pictures for each customer and class of customer
S Bushell
