The 2008 State of the CIO: The Imperative to Be Customer-Centric IT Leaders
To become real businesspeople, CIOs need to start thinking about, and reorganizing IT for their business customers.
Mon, December 10, 2007
CIO — Let’s face it: The work of making the customer happy rarely tops an IT professional’s to-do list.
Unlike slashing costs, boosting revenue or pushing the envelope on innovation, increasing customer satisfaction simply (and unfortunately) doesn’t fall under the umbrella of buzz-worthy IT undertakings. No wonder then that only 10 percent of this year’s “State of the CIO” survey respondents consider external customer focus to be an executive leadership competency most critical to their role as CIO. Add to that the fact that respondents say they spend a mere 9.4 percent of their time interacting with external business partners and customers and you get—yes—a customer focus gap.
“Many CIOs are a little cavalier about making raising customer satisfaction an explicit goal,” says Harley Manning, vice president and director of Forrester Research’s customer experience group. Rather, he says, objectives such as cost avoidance and innovation are far more likely to receive top billing on a CIO’s project roster. That’s because not only is bolstering customer loyalty a hard sell among corporate bean counters, its (arguably) intangible benefits and its (allegedly) nebulous returns often make it a thankless job. After all, when it comes to customer feedback, CIOs typically hear one of two things: harsh criticism or the sound of one hand clapping.
But despite this history of practical difficulties and emotional disincentives, some of today’s top CIOs are making customer satisfaction a priority—and reaping huge rewards as a result. They’re discovering that focusing on the customer can yield substantial benefits, including (but not limited to) saving money, increasing sales and enhancing productivity—as well as keeping the customer satisfied.
In fact, by tackling customer-centric IT projects, CIOs can reshape their role as key corporate players and position themselves for greater enterprise responsibility by aligning with the major concern of their executive peers and bosses. Business, after all, is all about serving the customer. If you want to be part of the business (and you do, don’t you?), you want to be a part of that.
Customer Focus Means Organizational Change
Pat Lawicki lights up when discussing her customer-centric IT initiatives. As CIO of Pacific Gas and Electric Company, a $12.5 billion San Francisco-based utility, Lawicki serves15 million customers scattered across two-thirds of California. Among them are Silicon Valley behemoths such as Hewlett Packard, Sun Microsystems, Oracle and Cisco. So when the California energy crisis, the Enron debacle and an executive staff overhaul in 2005 threatened to permanently tarnish PG&E’s reputation with its customers, Lawicki began working on a series of customer-focused projects.
The centerpiece of her efforts was PG&E’s SmartMeter program which provides customers with an automated gas and electric metering system allowing PG&E to collect data without setting foot on a customer’s property. Electric meter data travels along a system of power lines to a PG&E data center for processing while gas meters rely on radio frequency transmitters to deliver data back to the company via a public wireless network. Once a SmartMeter system is up and running, PG&E can collect energy usage information regularly and pinpoint power outages as they occur.
Future plans include allowing customers to access their usage data online, and the information is broken down so they can better manage their energy consumption and expenses. For example, a homeowner may discover that running the dishwasher every day at 4 p.m. is 20 percent more expensive than waiting until midnight. “The SmartMeter project is geared toward letting our customers have more control over their energy consumption while helping them save money in the process,” says Lawicki.
By end of 2008, it’s expected that 1.6 million new meterswill be installed across northern and central California, and within the next three years, PG&E wants to have the SmartMeter program up and running in nearly 6 million homes and businesses.
But as they provide customers with real-time insight into energy consumption, saving customers cash and the hassle of having to call PG&E to report outages seems like a no-brainer. Lawicki says that launching customer-focused initiatives (including a service that allows building developers to apply for new gas or electric service connections online) wasn’t as simple as flicking a switch; it called for a complete overhaul of the company’s IT organization in order to enable it to function as a single, centralized entity.
The first step was creating a Solution Delivery Center dedicated to the consistent delivery of IT solutions. This group of employees, including IT staff,the VP of marketing and subject matter experts from other lines of business, focuses on the skills needed to provide services and solutions to PG&E’s business partners and customers. Prior to introducing the Solution Delivery Center, Lawicki says IT-related processes, such as providing Web-based customer support, depended on whichever PG&E department a customer was dealing with. By replacing a hodgepodge of departmental styles, approaches and systems with a body that ensures consistent, enterprisewide IT processes, PG&E cleared the way for undertakings such as the SmartMeter project.
The creation—and reexamination—of IT roles also readied PG&E for other customer-centric endeavours. A newly fashioned chief customer officer, responsible for all aspects of customer service at PG&E, works with the IT department to design customer-focused strategies and develop products around customers’ needs. Even Lawicki had to step back and assess the part she was to play in the company’s new approach to customer satisfaction. Upon careful consideration, she began to see her role at PG& E as “transformational” and, drawing on her years of weathering mergers and acquisitions, started to analyze “the large amount of technology investment that was required” to revamp PG&E’s approach—and her own—to her customer’s satisfaction.