Is there a soft edge in business (Article 1, the Customer)



December 8,2015


Is there a soft edge in business? (Article 1 the customer)

Rich Karlgaard wrote a book (Published Jossey-Bass 2014) named the Soft Edge, where great companies find lasting success. Karlgaard evaluated several companies in varying industries and found that they all have one thing in common; they leverage their core values along with astute strategies and outstanding execution. The SOFT EDGE argues that “soft virtues” are the key to any business’s success in the modern economy. Soft virtues create meaning, inspire trust, and motivate people. Soft virtues offer a clear framework for seeing through the disruption of a rapidly changing environment.

He shares his findings and pinpoints five key similarities that create an organization’ soft edge:

  • Trust: Northwestern Mutual has built a $25 million dollar revenue juggernaut on trust; customers must trust that your product or service is authentic and robust enough to withstand the immediacy of today’s media. When things go wrong, customers and stakeholders believe you’ll do the right thing.
  • Smarts: In the age of Google, truly being smart means the ability to see and recognize patterns–and constitutes the difference between forecasting a likely future or simply following conventional wisdom.
  • Teamwork: Team-oriented selling and sales commissions outperform individually focused sales teams by 30 percent.
  • Design: Clever product design and integration are proxies for intelligence because they make customers feel smart. But taste goes further into deep emotional engagement. Specialized Bicycles calls it the elusive spot between data truth and human truth. How can you consistently make products or services that trigger these emotional touch points?
  • Story: In a world where outsiders can weigh in and have a greater voice on your brand, the ability to create an effective narrative is more important than ever.

On the other hand, we have the “hard edge” we’re all comfortable with, the everyday disciplines such as metrics that assess efficiencies, costs, supply chains, capital requirements, and so on. We also can’t argue with the logic of some hard edge processes, which can deliver sound business decisions and operational excellence, for instance, Six Sigma, decision analysis process, and analytic hierarchy process (AHP).

As a matter of fact most if not all C-level executives and many new managers are experienced, trained and comfortable in the “hard edge” culture that is primarily a financial one. Due to the results usually being very easily and systemically collected, measured, and scrutinized.

In short, we’re all very comfortable with numbers and think in terms of monthly operations/sales reviews with our boss or Quarterly reviews with the board of directors.

When along came the age of the customer wherein, things like Brand, trust, teamwork, and market messaging came into play. Needless to say, the new way of looking at things came under a lot of scrutiny, and was labeled as the idealist movement within the hard edge corporate culture.

The soft edge became necessary due to increased competition, the generational shift within many companies, and the dramatically changing business environment, however there was also the 2008 downturn which caused many companies to take a step back and realize that if it hadn’t been for some of their most loyal customers, they may not be around today.

So what is the soft edge?

“The Edge… there is no honest way to explain it because the only people who really know where it is, are the ones who have gone over”.

Hunter Thompson

So in This 1st entry of articles regarding the soft edge we will focus on the Customer, or “Trust” category in Karlgaards findings.

Customer: customers must trust that your product or service is authentic and robust enough to withstand the immediacy of today’s media. When things go wrong, customers and stakeholders believe you’ll do the right thing.

  1. Functional strategies (customer care programs) typically fail due to lack of alignment between the need to listen to the customer and the lack of a customer-centric organization. Meta group data
  • Communicate: Tell the customers that you have listened and are making the following changes to improve things. 5% of companies do this.
  • Measurement: Customer satisfaction, Internal metrics, online surveys etc. 95% of companies do this.
  • Communication: Tell employees what customers are saying. 50 % of companies do this.
  • Action planning: Company decides what to do about findings. 30% of companies do this.
  • Action deployment: Set up action team to implement the action plan 10% of companies do this.

      2. A CRM is not the “magic Bullet” it can segment, target, help sell, and help to invoice the customer.

It does not facilitate alignment or the want to make it work; it doesn’t create a high degree of trust and co-operation from employees.

  • CRM is a fantasy in most organizations. Over 60% of CRM projects end in some form of failure – Gartner Group
  • 80% of all CRM initiatives fail, and provide no reasonable ROI – vSente Consultancy
  • More than 90% of Meta clients are examining the financial justifications for CRM … many are taking a step back – Meta Group

3. So how do you gain customers’ and employees’ trust and build a customer-centric culture?

Below are my top 9 focal points:

  • Accessibility (be available)
  • Responsiveness (react appropriately)
  • Be informed (what’s up)
  • Knowledgeable people (training)
  • Promptness (show you care)
  • Keep your Promises (however BIG/small or costly)
  • Follow-up (No assumptions)
  • No surprises (particularly in customer policies)
  • Do it right the first time (DRIFT/JIT. Although it’s a production term, we can learn something from the concept)

In summary, there are 3 sides to a customer-centric culture one is an influence; things like mission clarity, employee commitment, high integrity workplace, Customer-focus an emphasis on recruiting and retaining outstanding employees.

The other is structure; things like effective systems and processes, performance-based compensation and reward programs, 360-degree employee communications, well-established learning and skill development programs and high accountability standards.

And the third is, don’t just have a vision and or mission statement, Or simply write the values that underpin these down on a poster, But rather add the soft edge strength to your business which can not be cloned as easily by basing your companies values on customer feedback. Involve your employees in the development of values, link these values to their brand, encourage your employees to align their behaviors to the values, and reward employees for ‘living the brand’.

Write Mike at:

Leave a comment

Your email address will not be published. Required fields are marked *