The only obsession that will bring you massive profits
Illustration by Rachel Revilla
I was in the boardroom with the owner and CEO of a global market leader that reaches millions of consumers across different Asian markets. The owner, CEO, the entire board, my team and I were staring at hundreds of their products spread out before us on a giant table.
They were facing a fundamental threat: they had too many products in their portfolio—which had a highly negative impact on their sales, profitability, marketing, distribution, entire value chain and the motivation of their employees. Our goal was to come up with a formula and strategy that would make it easier for the owner to decide which products to let go of and which to keep to radically boost profits.
Where did this product overload come from? The founder of the company had given a directive many years ago that the business should put at least two to three new products on the market every year. At the time, this may have made sense. But now, after we analyzed their customers’ needs and wants, it became clear that the solution was to focus on a few key “cash cow” products and get rid of the rest.
Coca-Cola
One of the reasons why we are consistently turning out massive profit increases for our clients is that we are obsessed with our clients’ customers and their needs and wants.
The most successful entrepreneurs and Fortune 500 CEOs I have worked with all have one thing in common: they constantly obsess over their customers.
Coca-Cola, one of our clients, is a case in point. After all, how many flavors and varieties of Coca-Cola do you know? The answer: not many, because they let go of any flavor or variation that does not make sense for their customers even though the Coca-Cola top executives may love it. They understand that it doesn’t matter what they want. It only matters what the consumers want.
Anticipate, create, educate
The best companies in the world anticipate their customers’ needs by consistently analyzing global and national trends. Then, they base the creation of their products and services on those trends. If they are really good at predicting changes in consumer behavior, they will be able to offer their customers a product or service that satisfies a need even before their customers realize they have that need.
Steve Jobs is a wonderful example of a business leader who was constantly obsessing about Apple’s customers and the customer experience so much so that he was able to create products and services that were ahead of their time.
As Steve said: “Get closer than ever to your customers, so close that you tell them what they need well before they realize it themselves.” In other words, know what they want before they do.
The trap of day-to-day
One of the major mistakes business owners and top executives make is to get so caught up in the minutiae of their day-to-day operations that they lose sight of the one and only thing that really matters, the wants and needs of their customers and clients. A lot of business owners and CEOs even invest more time planning their vacations than the journey of their customers.
One of our Asian clients had been so lost in following their own rules, directives and best practices that they never stopped to ask themselves if any of these still made sense in providing better and higher-value services and products for their customers.
After we established a ruthless new focus on customer-centricity, they realized that they had to completely overhaul their entire value chain to reflect that new “customer obsession.” The end result? A completely streamlined business that is agile, flexible, fast and focuses on the most essential.
The customer journey
No matter which business or industry you are in and whether it’s a B2B (business to business) or B2C (business to consumer), your customers will interface with your business across many different platforms. All these touch points together constitute the customer journey.
It is fundamental that every top executive, but most importantly, every CEO and business owner, regularly walk through every step of the customer journey to make sure that they deliver the highest value.
My group and I also work in hospitality and top luxury hotels are a prime example of the fact that a single mistake in the customer journey can literally cost or make you millions. Earning a Forbes five-star rating for your hotel ranks you among the most prestigious in the world. We had a challenging assignment, which was to help the Peninsula Hotel Group attain that famous rating.
If you already are a top luxury hotel, you do most things right. Identifying elements that still need improvement requires rigorous work and attention to detail. In order to do that, we had to dissect every single element of the customer journey and identify the key elements that still needed improving.
In the words of one of the general managers of The Peninsula Hotel Group: “With the help from Tom and his team, we were able to become the first and only hotel group in the world where all hotels are rated Forbes five-star.”
From extraordinary to world-class
What does that mean for you? To go from good to great, from great to extraordinary and from extraordinary to world-class requires you to obsess about every step in the customer journey and optimize it so you deliver the best product or service. You need to do this regularly because customer demands and journeys will change.
This is why business icons like Jeff Bezos and Steve Jobs obsess about their customers 24/7. As Jeff Bezos says: “The most important single thing is to focus obsessively on the customer. Our goal is to be earth’s most customer-centric company.”
Escape the ivory tower
When you neglect that obsession, it quickly shows up in your bottom line.
The billionaire owner of a large retail conglomerate approached me and my team during the pandemic because their e-commerce sales were slow and falling short of that of their competitors.
When we analyzed their customer journey, it became clear that it was full of dead ends and bugs. The management had done a lot of window-dressing but not spent enough time on the most essential element, which is to walk through every single step of the customer journey.
This is why video recorders made by Sony in the 1980s, the market leader of that time, became so difficult to operate that the CEO of Sony admitted that he and his entire management team could not use their own products. How did that happen? It’s simple: Some R&D (research and development) innovators in their ivory tower became so obsessed with adding new features that they never stopped to ask themselves the most important question of all: “Is this really important for our customers?”
Solutions and next steps
Ultimately, the questions every company should ask themselves are:
• What do our customers want and need?
• How can we help them to fulfill that need?
• What will our customers want tomorrow, in a year, in two years?
• What are the trends that will govern the changes in our clients’ needs?
• How can we anticipate those needs to be ready to serve our customers when the time is right? INQ
Tom Oliver, a “global management guru” (Bloomberg), is the chair of The Tom Oliver Group, the trusted advisor and counselor to many of the world’s most influential family businesses, medium-sized enterprises, market leaders and global conglomerates. For more information and inquiries: www.TomOliverGroup.com or email
