Podcast Episode #14: Growth Systems

Hi and welcome to the Key Customer Growth Podcast. My name is Jermaine Edwards and I have become obsessed with customer behavior and how people and organizations win with their best customers long term. After starting, failing, and growing my own companies, 30 customer growth projects, hundreds of strategies, and the study of 50 years of customer service research, I've seen firsthand how and why organizations win, lose, and win again with their most important customers. This podcast is my way of sharing those insights, failures, principles, and strategies so you can become what I call an Irreplaceable Advisor, someone so valuable your customers never want to leave. In an increasingly competitive world, how do you continue to deliver unrivaled value and deepen those most important customer relationships? Join me as your customer growth guide, your Your journey starts here.

Hey, it's Jermaine Edwards, your customer growth guide, and welcome to episode 13 of the Key Customer Growth Podcast. And in previous podcasts, we actually talked about something I called growth drivers, 3 primary drivers that for any and every organization around the world, you'll be looking at these specific areas in some format or the other, and the quality and thinking behind each of those areas will impact the likelihood of you getting repeatable and predictable results you can trust with confidence to growing your most important customers. Those 3 growth drivers were relational influence, value advantage, and intimate loyalty. If you haven't seen those episodes, you can go back a few episodes to see that and hear more about it directly. In this episode, so 13, we're going to talk about growth systems. 6 of the most important systems and practices needed to support those growth drivers and move your relationship sustainably long term. Now, within this whole idea of growth systems is a mindset. It's a philosophy, a way of thinking about the world and your customers that is going to be really important for you to embrace in order to challenge what you're doing and really to assess and ask yourself the question, how well are we doing really in these areas, and can we trust what we have? And so this whole idea of systems, and I'm going to label this term exponential thinking, enables us to get more from every decision and interaction we have, either internally or externally with our customers. And it will really move the way in which you think about every interaction, making those things work. And I came across these terms through some fantastic mentors that I've come across over the years who have challenged my own thinking in different businesses, different life areas that I've had to reinvigorate and transform in different ways. Being a dad of 6, having had multiple businesses, some failed, some won, some sold, and now really supporting organizations in different areas. This whole idea of exponential thinking has fascinated me. So how does this connect with growth systems? Well, let's start with growth systems and we'll move to what this thinking around exponential is. Well, growth systems are actually both invisible and visible for every organization and they exist for everybody. They support the success of key function areas, equips employees, helps leaders do great work, enables an organization fundamentally to deliver profitable results for themselves and their customers, ideally consistently. Some examples of some of these systems, visible growth systems, might be distribution channels— things you could see directly that impact how you serve and get particular products and services to new and, and current customers. Financial management protocols— the way in which you think about management of cash, how we think about the financial models you put in place to better optimize what you can actually give to your customers, how you make yourself competitive in a marketplace, things like that. And product superiority, how do you create unique advantage that makes you the, the number one choice because of the way in which your product delivers the most value for that marketplace. Those are some visible growth systems, and so those things underpin and support the way in which people operate and connect and communicate with customers. They have invisible growth systems, things that still impact the results you get with customers but perhaps are not always seen and measured accurately or measured at all. Those things like strategic relationships that oftentimes we don't see the invisible hand of relationships playing a role in the way in which we experience success with customers. Looking at brand and how our brand gets disseminated and referred to by other people and internally also, and organizational collaboration to the way in which we communicate and coordinate together. We co-create specific kinds of things that enable us to get results. So you can see there are so many things we could consider here, and ideally we want to be able to identify those areas and assess our effectiveness in each of those. And that's a task all by itself, but it's an important one and one that would really open up your eyes to the possibilities of what you're either doing right now really well or areas where you could be improving and getting significantly greater results. And this was true actually for a, a non-customer that actually is now in talks to becoming a customer. Some, uh, 2 years ago, back in 2018, a very large technologies company I had the opportunity to speak with and to really think about some of the things that they were doing. They had 7,500 customers, and what was taking place there is that they recognized that they were still lagging behind so many of their competitors in terms of really being able to get the most from their current customers, increase their profitability, their ability to scale very quickly by leveraging what was taking place with their customer base. And just with a really short evaluation using what we have internally here called 7 Signals, a model of evaluating the health and strategy of a customer relationship and the strategies used, We were able to identify that, you know, there were these 197 customers, so it'd be 197 of 700, 7,000 customers, uh, were delivering almost 95% of the revenue. So 3% of their customers were delivering 95% of the company revenue. Now, believe it or not, that's not an uncommon ratio, that 5% to 95% ratio. People talk about 80/20, but actually, in reality, it's actually much more dire than that. And so what they had recognized here was that they had really failed to understand what was needed to activate the other, you know, 7,000 customers that were inside their books. And not all of these customers were ideal customers. They had to properly segment them and make some really key decisions to how they want to serve and really grow as an organization, where they want to put those investments. And after really analyzing this, Rook noticed there were about 15% of that 7,000 that were ideal customers, about just over 1,000 plus. And so just by applying really specific growth principles, they could activate 5% of that particular number and jump to 7th in their market revenue. If they really committed to it, they could actually get the entire 15% and jump to number 2 in their marketplace. Doing almost 4 times their revenue without adding a single new customer, just by understanding the things that I'm about to share with you about these growth systems, but also going back and listening to the other episodes and thinking about these other 3 growth drivers. So what does that mean for you directly? What it means is if you aren't aware and understanding what those growth drivers are, the things those that you're using internally. And if you're not actively, effectively using those growth drivers, you're putting yourself in a dangerous position for not being competitive long-term. But growth systems that we're talking about, if you don't have an evaluation of those things, you won't know how to properly leverage and grow and assess the things that are working for you internally that will enable you to have sustainable long-term change and results with customers. That's really important. So let's think about this together. So many won't have considered their business as having these kinds of systems, these growth systems, but it's this view of your business that will truly transform how you view almost everything. So particularly how you support the customer growth drivers like I've mentioned. Now Gross Systems, at its base, is a group of interacting or interrelated entities that form a unified whole. So that's the kind of the dictionary version here. A system, at its base, is a group of interacting, interrelated entities that form a unified whole. It's that unification of systems working together to specifically achieve a whole, that whole identified by you as the outcome. Now, in relation to growth with our most important customers, Customer Growth Systems refers to the creation of organizing systems and practices that support the core growth drivers for long-term continued profitable relationship health and success. So it's the organizing systems and practices that support the core growth drivers for long-term profitable relationships. Okay. So what we choose to adopt in this case then, change and include into our business and daily practices, eventually becomes part of the Organizing System. So what we choose in terms of technology, new practices, processes, actually really matters to the Growth Systems that support the Growth Drivers, if we're really thinking about it in that kind of structure. The challenge is understanding what systems to include and how to effectively identify and evaluate the ones you have and if they're working. Now, first of all, you must know among many growth systems that support long-term customer success, there are 6, 6 primary ones that I want to introduce you to that every organization needs to adopt, review, or optimize if you have already. Number 1, Growth Playbooks. Growth Playbooks. Now Growth Playbooks here is interesting, and I haven't done an episode on this yet, so I will do definitely. The whole idea of Growth Playbooks is the enablement for a business to be able to plan, pivot, prioritize, and adjust pre-actively and proactively to any change in a customer relationship. So a plan often fails because it doesn't hold into account the changing nature of your business. But just imagine being on a sports team and the coach coming out and saying, okay, I've got this plan for winning the game, but then the plan stops working. And instead of just coming together and doing something different, he says, okay, we're gonna do the plan again and hope something else happens, hope it gets better or something else starts to work in our favor. That's just not how life or business works. If the plan is does not work. If something isn't the way, we need to evaluate and pivot very quickly. Plans do not help you to do that. Plays do, which is why they use plays in sports and why for business it's a really effective and helpful tool. So having an understanding of Growth Playbooks is really important. I've got a specific link to a blog that kind of walks through these specific details of the playbook as well, but I'll give you the 6 different elements of this playbook so you can really capture this now. The first is a playbook In the playbook, you need to have these 6 different areas. It needs to cover assumptions, it needs to cover the customer journey, it needs to have specific customer maps, goals, strategy, and needs to have an evaluation of the team. Now, all of these have interlocking parts that work together very, very well. If you go into the blog, you'll be able to see more of that. But in brief, the assumptions area here is a specific area in a playbook that allows you and the business to guard against potential false or unhelpful biases that may prevent you and your organization from making really poor customer decisions. So if you can run a play such as assumptions, and you may do this in areas where you're doing something new with a customer or you're responding to something with the customer, you might ask yourself, what is it that we know about the customer today that impacts the way we do work together? Or what is it that we don't know that impacts the way we do work together? These questions fundamentally will change the way in which you think about those interactions. They're very, very powerful. So check out Gross' playbooks. The second is asset leverage. Now, an organization's ability to continuously identify, utilize, and discover hidden assets in its business will in most cases determine the limit to how much value it can deliver to its business or its customers. So what do we mean by this? Well, asset leverage is the term typically used in the financial industry, a strategy in borrowing that allows you to increase the potential return on any investment made or an investment. But this principle can actually also be applied to customer success in order to gain maximum leverage from every action, investment, or commitment you make. You can ask yourself a series of questions that support you helping to helps you to think about what particular assets, things that are valuable to, to us and to other people, that we could look at and use to our benefit. So an example of that might be in your department, going interdepartmentally, how can you engineer greater success into every action and decision you make in regards to the impact to the customer? So you think about the assets that you have and see, are there any particular assets in the business, maybe it's intellectual property, maybe it's insights, specific kinds of technology that you have that help you to engineer success for your customer or for you to optimize what you do in order to get greater output from the things that you do and for customers. A really helpful question, gets the ball rolling, gets you thinking about those different areas. So asset leverage, really important. Then we have change practices. So One thing that we can always count on is change in this life, and your ability to think about change, know how to navigate, and almost, you know, control the experience of change where that's possible is actually a really important skill. And I say skill very seriously, that it is a skill and a bit of an art as well in doing that, which is why we have organizational change consultants and people who specialize in this area. Q5 being a company that I really respect in that particular industry that does this very, very well. As well. Now, our interactions with our customers require a clear understanding of how we will enable and support our customers to change and make the change needed to achieve the results that they want. And there are so many different processes we could use for managing change. I personally just go at a base level using something called ADKAR, which is a very popular, known, and trusted framework for thinking about how you move somebody right from, you know, the beginning of a change right to the implementation, reinforcing those different areas. So the ADKAR is an acronym meaning Awareness, Desire, Knowledge, Ability, and Reinforcement. It moves people really well through that change. You might want to jump into the blog to figure out just how you might think about that. And I'll definitely be doing something more on that later on. We have number 4, Growth System Lifecycle Management, and you'll definitely want to see the image of this, but essentially there are 8 specific steps to full lifecycle management that every organization needs to be aware of, particularly if you're serious about your marketplace, and particularly if you have really high profitable customers who buy expensive, very complex purchases from you, you're going to want to pay attention to this lifecycle management because we know the cost to you losing this business, that kind of customer, can be very, very great. So the whole idea here is that we want to move from advocacy right to retention. And the whole idea of these 8 steps is you move from advocacy, awareness, knowledge, consideration, Selection and assessment, buying satisfaction, right round. There are these defined steps and questions you can ask that every department can be a part of to support in thinking about this area. But lifecycle management is an important sequence that once you access and get a view of this, you'll be able to see exactly where every department can be responsible for supporting and the success of customers. Number 5, agile communication. Now, oftentimes we can often take advantage, or not take advantage, but undervalue communication and the quality of communication that's really needed to generate real trust with customers, particularly when it comes to managing their requests when it comes to giving, you know, poor news, when it comes to giving even good news, how we do that and how we turn that into an advantage for us. So Agile communication, again, it's a phrase used predominantly in a project management discipline and Agile working, but in a frame of customer communication, Agile represents our ability to effectively communicate in a way that gets us the intended result first time. In the fastest and most efficient manner possible. So it's effectively communicating in a way that gets us the intended result the first time in the fastest and most efficient manner possible. And some of the results to that will be like increased productivity, quicker decision-making, immediately improved customer experience, and really positive stuff there. So there are 3 things to get started in order to really think about that. And obviously we have a process to help people do this very, very quickly. And mobilize teams to do that. And we want process evaluation, we want clear outcomes, we want group ownership. So evaluation means, you know, taking account of what is working, what isn't, and why. Decision on the exact result you want from all areas of communication and being really specific about that. And then group ownership, getting clear assignments designed into the roles across the business. And if you can do that, if we can do that, will definitely find will have greater success in these different places. And finally, organizational philosophy. So organizational philosophy is the way we do things around here. So in another sense, the company philosophy stands for the basic beliefs that people in the business are expected to hold and be guided by, and we need one for our customers. So an organizational philosophy is powerful as it shapes and influences the core beliefs about how we, your teams, departments, serve customers. But unless it's given specific animation, specific meaning to each department, it will simply feel like it's a company philosophy and one that is not organizationally developed, meaning it's something that as a body, as an organ, working together, functioning together, you're all using the same blood flow, using the same, um, really internal workings to function effectively. So the philosophy is designed to create a vision for what you want customer engagements to really look like across your business. And without a clear vision, you will have an organization living out customer values that does not achieve your ideal result. So a question you might ask yourself, colleagues, or internal departments is, how do you believe your department, you know, or role contributes to the success of customers in your business? Now, after you've asked this specific question, you might listen really attentively to the results and responses. Every response from each department will show you if they see their role as the same, and whether or not you really have a clear customer philosophy. If you don't, it's very likely you're going to have potential saboteurs, unintentionally perhaps, but people who are not geared up to give the same kind of experience to customers in their interactions together. So you want to watch out for that directly. So those are the 6 that I wanted to share with you. So really briefly, we have Growth Playbooks, Asset Leverage, Change Practices, Lifecycle Management, Management, Agile Communication, Organizational Philosophy. Those sound, sound pretty big, but actually when you get into the details of the specific areas, they make so much sense and we can attach them to the Growth Drivers and we can see exactly how they, they're put together. But more importantly, these are things you probably have working in your business. Might be invisible, some might be visible, and we need to just go in and optimize these particular areas and get them working for you and not just randomly for you. We want not random acts of success, we want recurring acts of success, and that means being vigilant in our thinking and thinking exponentially. And exponentially is simply this: it's the ability to think beyond your day-to-day and start to see the future outcomes of your customer. Start thinking beyond the day-to-day and start thinking about the future outcomes of the customer. We cannot do that without fully realizing and utilizing and optimizing what we have, or being aware of what we have in our own businesses. And you have a lot to give to your customers, so much to give. We just haven't been taught a way to extrapolate that from our own companies. So hopefully that's been helpful to you. Please do go back to other podcasts so you can see the Growth Drivers in action, but these Growth Systems something you can begin to do today. So check out the blog so you can see a little more detail. Get in touch with our team if you want to have a conversation, but I'll see you in the next episode and make sure that you are continuing that journey to be the advisor your customer never wants to leave.

Hey, thanks for listening to the Key Customer Growth Podcast. Hope you enjoyed the episode and got some great value. If that has been your story today, please share, comment, and subscribe so we can reach more people with the message and impact them also. Most importantly, I want to hear your feedback on what you liked or what you would like to hear and see in the future. Look forward to hearing from you, and you can find all the show notes below. Wishing you success in becoming an Irreplaceable Advisor.