Editor’s Note: this is a continuation from this post is-there-a-need-for-customer-oriented-architecture

Market Change Forces

This highlights another key factor in the need for the customer oriented architecture (or at least a way of thinking about what our IT infrastructure that aligns or orients on the customer). In my lifetime much has changed regarding how I perceive my role as a customer. When I first entered the market as a consumer, the view of my relationships with the businesses I patronized was much different than it is now.

This was characterized by a dramatically reduced set of choices (in many cases, items were only conveniently available from one source) regarding where I could purchase the goods I desired. Also, where choices existed, it was more often the case than not that a different set of products would be available at each goods provider (characterized primarily by brand but also by stocking choices). Product variation by brand often held a striking degree of competitive differentiation with product design and engineering existing as a stalwart source of competitive advantage. There was strong brand loyalty by both product and business.

Many services that were offered came from a single source. Telephone, electricity and gas are examples of services where there was no option for consumers to receive these services from another company. There was only one provider, and that was the end of the story.

One of the critical changes to influence businesses in every market came from changes to these fundamentals of market dynamics. As our choices began to grow and product differentiation began to diminish this removed the primary elements fueling brand and business loyalty.

Of course, online shopping did nothing but escalate this change. With online shopping came the opportunity of almost unlimited choice for consumers. Online shopping carried several unique values that really pushed forward the trends of current market dynamics. Though there are still many reasons why we often prefer to purchase goods and services through brick and mortar stores, online stores are available 24/7, they are in our homes (regardless of their physical location) and they have no rigid product stock limitation so they can offer every version of every possible good or service without significant cost increase.

The pricing model for online shopping is hyper-competitive, so much so that profit margin erosion has put large, established organizations out of business and forced massive reorganization, productivity improvements and cost reduction to occur in almost every market segment that exists. We all know of these changes but what we do not often formally recognize is the behavioral changes that have occurred in our customers (and us as customers).

Companies have done an excellent job in the areas of performance, productivity and cost. They did this because it was essential to survival. Change or die – period. But the consumer behavior that has not been placed in its proper perspective is the willingness to switch. Consumers have changed from loyalty based behavior to the exact opposite. If you don’t give me what I want I’ll go to the next guy.

This behavior is more extreme than we in business often realize. Have you thought about how customers are really viewing their relationship with you? The swing is so strong that the view can be visualized as our customers interacting with us with a big chip on their shoulders that claims “make ONE mistake, ONE MISTAKE, and I’m GONE!”

Consumer mentality is a business time-bomb, an unstable explosive just looking for a trigger. In the current global market, the consumers we seek to develop relationships with seek any opportunity to find our flaws and say “Aha! I knew you would fail me. I’m out of here!” and they are gone.

A Precarious Balance

Now, there is one market factor that currently shields most organizations from experiencing a level of customer defection that could easily spell the death of the business. Right now, very few companies are focused on the concept of successful customer outcomes so the majority of businesses consistently fail to deliver them. Do you think that is a safe case to bet the livelihood of your business on? If you do then you probably also think you can beat Vegas at their own game and the Lottery is nothing but a cash collection machine. There are businesses that are nailing the concept of successful customer outcomes (consider the budget airlines, Zara clothing retailer, Dell) NOW. Some of these organizations have decimated existing giants with huge comparative reach and financial strength. Size and resources mean nothing in this game. The simple equation is that those who deliver successful customer outcomes – WIN.

By now I expect you may be wondering about how this all relates to IT as this would certainly be classified as the domain of the business side of the organization. Well, yes and no. True, the path to the customer oriented architecture certainly contains important business ramifications and, true, the business side needs to get on board with this concept to begin with or nothing will change. But the customer oriented architecture is a case specific design issue that once properly communicated to the business folks will likely have them jumping up and down in anticipation of having it in play.

All Roads Lead to Successful Customer Outcomes

Here is where we start delving into the meat of the customer oriented architecture. For a customer oriented architecture to exist there must first be defined successful customer outcomes.

We will talk more about defining SCOs later but for now let your imagination picture it based on what we have already discussed. There are a finite number of high level blocks where the degree of result against each SCO is affected. If you haven’t jumped ahead of me yet, sure, this is a form of process modeling. But disconnect yourself from anything you know about process modeling when you consider this because, baby, this ain’t the process modeling you have done before.

Within the customer oriented architecture is the concept of SCOs and things that affect these outcomes – call them success affecters. Suffice it to say that a success affecter is a sub-component of a SCO that always affects the real result to the customer within the definition of the successful customer outcome.

It doesn’t take a rocket scientist to see what is coming next. I have already referred to process modeling. The glue that brings success affecters and SCOs together is indeed a process, and there is a process for each and every SCO. Let’s call each of these SCO processes a success chain because failure of any one link will result in failure to deliver that desired SCO. Each success chain will have blocks (no, do NOT call them steps) which are the success affecters we have already introduced.

So how do we define these SCO processes and their success affecters? It all starts with Successful Customer Outcomes.

to be continued with The Customer Success Statement