How to be a customer-centric leader

Customer orientation starts in the heads of executives, so they say, but it is the behavior that counts. Customer-centric leadership behavior is, besides factors that lie within the employee, a crucial key for employees to internalize and perform customer orientation. According to research of the Institute for Market-oriented Business Management at the University of Mannheim there are three dimensions which likewise determine customer-centric leadership: performance-orientation, employee-orientation and customer-orientation.

The three dimensions of customer-centric leadership

High performance-orientation is characterized by the way you as executive actively and regularly communicate the company vision and business objectives to your staff as well as how you align and continuously control performance goals.

Employee-orientation means that you show your staff personal appreciation, you know your employees’ personal and job-related goals, and you support them in achieving these goals.

The degree of customer-orientation is best exemplified through your own interaction with customers.

In their research German professors Christian Homburg and Ruth Stock extracted 5 typical leadership-profiles. The three dimensions differ from one another in terms of degree of customer-centered leadership: The »dictatorial customer-oriented«; the »Softie«; the »internal optimizer«; the »Bully« and the »customer-oriented manager«.

f you want to find out which type of boss you are, check the leadership profiles (PDF).

Customer-oriented managers

Customer-oriented managers show high measures in all three behavior dimensions. Their leadership performance has a positive impact on the customer-centric attitude and behavior of their staff. All other leader types have a low profile in one or two of the behavior dimensions and are less successful regarding managing customer-centric behavior.

What can be done in these cases?

Employees are customers regarding the way you lead

More employee-orientation means for you as superior to actively make and maintain contact with your employees; to build trust and develop a close relationship; to show true interest for them, their concerns and needs; and to support them by creating great but meeting working conditions and possibilities for individual growth. All this can be achieved by

• Individual personal conversation held in confidence and in an undisturbed atmosphere with employees about their job content and results, their satisfaction with working environment (and also the boss!) and their professional development
• Informal communication at the employees’ workplace, e.g. when walking through the store or the offices
• Jointly celebrating even small successes and activities such as Christmas or birthday parties
• Showing personal appreciation and giving praise which comes from the heart and is honest – and not only once a year

Enabling performance

Everyone strives to make an impact. Successfully accomplishing ambitious challenges is evidence of one’s own ability and effectiveness. It helps you to gain recognition and makes you feel proud and stronger. Properly used performance-oriented leadership techniques can serve to provide both orientation and stimulation for employees. They know what their tasks are, what they are responsible for, which performance targets they should achieve – in a nutshell, what they are there for and their relevance they have for the success of the company. To enhance performance-orientation in your leadership it is helpful to

• Conduct regular meetings about the company goals and projects as well as the achievements of target
• Jointly agree upon clearly defined and smart (SMART= specific, measurable, ambitious, realistic and terminated) goals, but leave the approach of how to reach these goals up to the employee
• Have regular conversations with each staff member about their individual performance goals and the evaluation of their successes
• Place, challenge and advance your employees according to their strengths, talents, skills and abilities
• When possible assign self-contained jobs for which smooth fulfillment the employees are completely accountable
• Delegate not only the execution of duties but also the responsibility and the power to make decisions in a suitable way
• Take mistakes and failures as chances to learn
• Support your employees in achieving their targets.

Be a role model—show your employees how to interact with customers

Customer-oriented leadership behavior is on one hand reflected in your direct interaction with customers of your store or your company. Your employees closely watch what you do and how you deal with customers. They draw conclusions from your behavior and take it as example—both positive and negative. On the other hand your customer orientation is demonstrated in the way in which you focus on the customer throughout your daily business—in your goals, procedures, activities, decisions, meetings and conversations. In order to sustain your customer orientation you have the following options:

• Seek direct contact with customers through regular sales activity and work at the point of sales – all too often this is neglected because administrative tasks get in the way
• Systematically make customer orientation a regular and important topic in your meetings and staff conversations – often times it’s only turnover, assortments, sales promotions and advertisement that are talked about and customers, their needs and possibilities to improve customer experiences come last or are completely left out
• Tell each other stories about exceptionally nice, successful, extraordinary and memorable experiences with and of customers
• Adequately and systematically acknowledge highly customer-centric staff behavior
• Support your employees in becoming customer service stars e.g. through regular trainings and seminars and the provision of related literature and magazines
• Integrate customer orientation as a criteria and target variable in management tools such as appraisals and target agreements
• Systematically gather and analyze customer feedback – read our practical experience tip Those who don't ask won't win

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Customer-centric leadership is a standing order (this sounds to me a little too formal, relating to law or military, but it works as far as meaning goes), a daily challenge and a constant, never-ending development and learning process for all executives and managers in the retail business. Sometimes leaders need support, new impulses, encouragement or ideas to stay on track. If you feel like you could use a little of that, Kiehne-Neuberg Consulting offers help, for example through executive coaching or store visits. Or get in touch with us here

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