Tim Sanders, Chief Solutions Officer at Yahoo!, Talks About Fulfilling the CRM Promise with Knowledge, Network, and Compassion
Barry Jacobs: You have a new book out, Love is the Killer App. What's that about?
Tim Sanders: It's about the power of relationships in business. It's about how to be happier and more content with your business life. But fundamentally, it's about three keys (or the three secrets) in building a much better business environment: knowledge sharing, networking, and compassion. Those would replace the GSE, the value system that has been around for 20 to 25 years: greed, speed, efficiency.
The GSE model has a lot of momentum and it has a very good set of icons — the best and most popular, I think, is Michael Douglas character, Gordon Gekko, in the movie "Wall Street." It's a much safer route so it's had a lot of cultural momentum. The book argues that there have been some fundamental changes in the fabric of society, a la Alan Toffler (Creating a New Civilization, 1995) at the technological, social, and emotional levels that have caused GSE to become outdated and not deliver happiness nor necessarily success. The replacement then would be the knowledge, network, and compassion.
BJ: Do you see a tie-in between Love is the Killer App and CRM?
TS: Absolutely, I think that CRM's motive all along was to deliver the value as promised and to manage the expectations as an act of kindness. The execution, however, is another business opportunity with its own set of, you know, profit, loss, and funky metrics. (I call it ways of looking at it). Fundamentally, when CRM is done correctly, and some of the folks I know that do CRM the best, do it the best because they care so very much about their customers and they are technologically agnostic when it comes to that. Southwest Airlines is a prime example. Are they on Siebel? It doesn't matter. I don't want to sound like Jim Collins (Built to Last, 1994), but it doesn't matter. They have the right vision on the bus, they have the right religion on the bus, they care about their customers from the bottom of their heart and it shows. Same for Starbucks. And I know those companies intimately.
BJ: OK, so if the customer is king and if business process change starts with people, what's the role of technology in a customer-centric enterprise?
TS: Well, it's a tool. Technology is just a process. And I am going to give you a funky example but youll get the idea. I recently noticed great technology at work for a person who runs a very small business. Let's call him Elevator Operator Inc. He was a guy in the San Diego Hotel Del Coronado. It's a great old hotel that has one elevator and it's run by a guy in a little red suit. The guy always has a quirky personality and many times he sings, and he is really kind of strange actually. There was this one guy, Norm, and he had this thing he did, it was a total Dale Carnegie thing, he would learn your name the first day you checked in, he would ask you a couple of questions every time you got on to make conversation, and he would customize. So by the time you left he knew you intimately: He knew what to suggest, he always knew you by name, he asked how you were, if your baby was feeling better today — it was true skill. So I asked him on the last day I was there [speaking at the Fast Company Real Time conference] before I left: "How do you do that?" and he said, "I just say it three times, close my eyes and type it." That is technology — it's a process, and sometimes it involves organic elements like our mind and our hands, and then sometimes it uses what I call nonorganic means, which is everything from electronic to silicon. So technology is just another tool; and if we look at it as just another tool I think we have a more balanced approach to dealing with our motivations. Because to me, it's not so much that the customer is king, it's that I have integrity and I made a promise, and I am going to fulfill that promise because it's the right thing to do. And if I don't fulfill that promise I have done that person wrong — that's the reason I believe in CRM. Because the customer is not always right; Herb Kelleher (chairman and CEO of Southwest Airlines) will tell you that sometimes the customer is wrong, and you should tell them, "You are wrong."
I think that CRM's motive all along was to deliver the value as promised and to manage the expectations as an act of kindness. |
BJ: What solutions are being developed at Yahoo! for ensuring that youve got a satisfied customer?
TS: We call it Customers to Partners. And I am not the spokesperson for it so I am going to make that caveat, but Ive observed a lot and participated in a little piece of that. Me, personally, I spend most of my time customer-facing at the end of the funnel on the ideation side of what's going to create value. More in a predictive move like "Let's create a solution to how you communicate with your customers." We have a Siebel system, which is the heart and soul of 360-degree view. The 360-degree view is pretty core to CRM; I don't need to go through that with you. It's a Siebel system weve customized. We internally have our own system called Joilet and every Yahoo! is trained on it. We have dedicated training for it and we spend a lot of time to drive not just the sales group, but product, account management, and R&D groups are all on it so that they all see the opportunities — that's important, and they have all been motivated to participate. The motto is "Yahoo! is forever." Part of the reason that sales force automation is important is that we don't forget. We have a real motivation not to be a corporate Memento (a sleeper hit movie in 2000 about a man who loses his short-term memory and has to rely on a polaroid camera to remember people he just met). I think that so many corporations out there, especially in our space in advertising online, have that disease. They walk around with a Polaroid taking pictures and then they lose the Polaroids from time to time. For us, corporate memory is "a thing." We want to retain our corporate memory. The advantages of participating in the system don't just show up when your customer reviews with you and it hits your bottom line on your MBO. Really, fundamentally, if you think you are going to stay with Yahoo! for a long time, you know that it is intellectual capital; it is customer capital. It is one of the three big swingers in intellectual capital besides the systems and the people.
BJ: The implementation and the integration of Siebel with your own internal mechanism, Joliet; who built that for you or did you guys build it?
TS: We worked directly with Siebel on it. We had a variety of system integrators on it, and Kevin Smith of Yahoo! could tell you what the installation looks like. Once Siebel goes in and we begin to look around and see what we are learning through Siebel, we begin to think about this idea of Customer Capitalism. Have you read that book by Sandra Vandermerwe? If you go to crmproject.com, [there is] a fabulous Web site with incredible amounts of incredibly good articles.
BJ: Do you want to hear the funniest part about that? That's what we are talking about right now. Im the publisher of that site. The book itself, Defying the Limits, Volume 3, is what this is going to be in. We used a separate URL to keep it simple.
TS: Right on, I have read every page on that site and I have sent many, many people to that site. The first thing that I ever do when I run a CRM seminar is say go to crmproject.com and put a bunch of paper in your printer. In regards to Sandra Vandermerwe, who wrote Customer Capitalism — if you install some kind of Siebel or any kind of sales force automation correctly, and then you begin to look at it reflecting the strategy that comes from it, and you start to listen to your customer, and you make sure that you read Clayton Christiansen's The Innovator's Dilemma so you don't listen too hard, you begin to see how you can surround the customer activity space with services and close all your value gaps and compete more effectively, because if you install Siebel correctly and everybody plays in it, you can see everything from presales to execution to reporting; and you begin to understand the customer activity space much better and see where you can add value. When I say CAC, which is customer activity space, the way I always think about it is the example Sandra Vandermerwe uses about the smart car. You know in Europe, they say that customers who are buying cars are buying short-haul mobility. That's the activity space they are in and there are tons of services that are part of that activity. If you live in Germany and you get on the Autobahn, you are going to need a bigger, faster car. If you go to England, you are going to fly or take a train. You are going to get insurance, you are going to get financing, and you are going to get all of these services that literally surround the activity space. And to the extent that an enterprise fails to provide any one of those pieces — those are called value gaps. And once I understood that, I understood many of the things that we could have done better. eBay is a classic example: You could have seen that there were many things in the customers activities — finding, buying, and communicating — that if we would have done something like auctions earlier, we could have closed a value gap. And its similar to the smart car example in Europe: If you don't provide a car rental or transportation solution as part of the car package, for all you know British Airways introduces Lexus in flight with a special deal. Or, for example, you rent another car — that's a classic Avis model, you rent a Chevy and decide that the Malibu doesn't suck that bad and you change brands. Stuff like that happens all the time because the provider doesn't surround the space. So for us, initially you install something like Siebel to have a 360-degree view of the customer to deliver your promise better and eventually you build your business better to predictably surround the customer space and close the gaps, and then it becomes more of the fabric of the company than just an account management tool.
