Listening to the Voice of the Customer is no way to innovate, according to Alain Hui Bon Hoa

This is a topic I addressed when I sat down with Alain several days ago. Why isn’t listening to the Voice of the Customer the best to innovate?

I/ Presentation of Alain Hui Bon Hoa

Alain Hui Bon Hoa is a Service Operations Director (COO) and Change Leader, with more than 10 years of experience in Senior Leadership Teams of international companies, such as GE. Alain brings a wealth of knowledge in leading strategic and operational transformation to boost profits. His expertise is based on :

• turning genuine customer insights into a compelling strategic vision
• aligning the business, across functions and at all levels: innovation, organization, processes, people and culture.

Born in Vietnam, from a Chinese family, Alain is French and has worked in the US.

 

II/ Innovation based on Voice of the Customer (VOC)

In a mature market where “push” technical/technology innovation has become too incremental, smart companies frequently turn to customers to help them create the next competitive advantage.

Their source of inspiration is based on their existing Voice of the Customer activities. These usually include:

–       Competitive intelligence

–       Salesforce feedbacks and tender analysis

–       Customer satisfaction or “Net promoter Score” surveys

–       Customer Complaint management

–       …

More intensive VOC may include

–       customer calls following the survey

–       Customer Advisory Boards, where a virtual team of representatives from several customers are gathered on a regular basis to provide feedbacks to existing or forecasted operations

–       focus groups which involve several dozens of customers that are interviewed in order to capture qualitative information and provide feedbacks to concepts/prototypes. Alternative product offerings may also be discussed

 

In Alain’s experience, capturing the Voice of the Customer that way is key to maintain and increase the level of satisfaction as the market matures and customer needs keep on evolving. The problem is that it rarely enables a disruptive innovation, something that allows to leapfrog the competition. Indeed, customer feedbacks captured that way tend to fit one of the following categories :

–       I am not satisfied with feature X of your product/service A, because …

–       The competition provides feature Y which I like a lot, because … You should do the same

III/ Listening to the Voice of the Customer is no way to innovate

As a consequence, Fortune 500 companies develop a tendency to invest in product improvements in order to improve their product based on customer feedback. Two years down the line, Fortune 500 companies launch a new kind of product which, in fact, is a copy of competition… while,  competitors have update their product/service, in the meantime ! In other words, listening to the Voice of the Customer leads to imitation rather than innovation. 

Obviously, this is not the best way of innovating. In a follow-up conversation, Alain and I talked about how to perform customer-centric innovation.

  

 

Further readings:

• For a discussion on the drawbacks of customer focus groups, please refer here
• For a discussion on how to manage customer-centric innovation, please refer to this HBR blog post
• For another definition of customer-centric innovation, please refer to this Financial Times definition — Design thinking