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Study: Lack of C-Suite Leadership Leads to Most Customer-Centric Strategies Failing

Ask anyone who’s ever ordered from Net-A-Porter: What makes the shopping experience so memorable? It’s not the selection of luxury labels; it’s more likely to be the tissue paper-stuffed, matte black boxes the orders are delivered in, tied with a grosgrain black ribbon, as if they had just been hand-delivered from a high-end department store.

Because founder and former executive chair Natalie Massenet understood that to succeed as a standout retailer today is to focus on customer service as much as the product: Build great relationships with shoppers and they’ll return in droves.

But according to a new study conducted by Harvard Business Review’s Analytic Services, most of the consumer-focused strategies put in place by retailers are falling short of expectations.

“Many customer-centric strategies fail during execution because they were designed for the boardroom, not for the customer-facing employee,” said Lior Arussy, president of consultancy firm Strativity Group, which sponsored the survey, titled “Making Consumer-Centric Strategies Take Hold.”

In fact, in a poll of 315 business executives, only 36 percent of respondents have a dedicated team and budget to implement a consumer-centric strategy—despite 43 percent planning to have a scheme in place in a year or less and a further 31 percent aiming for one within two years.

Furthermore, only 20 percent of these strategies are led by chief executives and only 19 percent are led by a C-suite member other than the CEO.

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“In the breakneck relay to drive the strategy from the boardroom to the cubicle, many organizations are dropping batons at every point from creating a meaningful vision to training employees,” the study said.

Sunil Gupta, a professor at Harvard Business School and chair of the general management program, said, “If top management isn’t leading the charge and the effort is not well funded, nothing will happen.”

“Customer centricity is more than an idea of PowerPoint slides,” Melissa Sturno, vice president of marketing and customer experience at Fresenius Medical Care, continued. “To make the strategy work requires aligning behaviors of thousands or even hundreds of thousands of employees. That requires a diligent focus on the fundamentals of managing cultural evolution.”

But according to the survey, while nearly all of the respondents (80 percent) said training is very important, only 40 percent are equipped to do it well.

“Customer centricity needs to be designed for employee execution and ensure that each employee is ready, willing and capable of delivering on the customer-centric strategy,” the report said, noting that to successfully accelerate customer centricity, retailers should consider the following: a meaningful, human cause; integrating initiatives into a holistic program; designing strategies for employee performance; aligning processes with metrics to accelerate; setting the standard to “exceptional” in everything.