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Last week saw the unseemly defence by SIAM
(Society of Indian Automobile Manufacturers) of two of their member
organizations against the adverse crash test results pronounced by the NCAP.
They wasted no time retorting that both the vehicles in question did meet
Indian safety standards.
I'm not the expert on automobile safety and
therefore what an Indian Safety standard (as distinct from the standard applied
for the NCAP crash tests) implies for the protection of the Indian passenger.
But the alacrity of the defence by SIAM seemed to suggest that compliance is a
cheaper substitute for concern.
But this isn't about motor cars or crash test
standards. The central issue is the prevailing apathy towards customers in
India. I find it ironical, because at some level all of us are interchangeably
customers and sellers. Most of us (and very often) find ourselves at the
receiving end of callous customer attitudes. The Director General of SIAM is
reported to have said " Global NCAP can do what they want. We have our own
safety standards road map which we are going to follow..."
Sample this: I have been trying for close to a
year to get my airtime company ( the biggest we have) to install a booster in
our office. Because all of us on this particular network have to literally to
hang out of the balcony to get any signal. After several rounds of following up
and pleading, their final stand was there weren't enough users of their network
to justify a booster. I think they must know how difficult it is to shift to a
new network.
But why is this important to anyone? Is there
really a business case for much better customer empathy?
Sometime last year I had spoken about Return On Customer Experience as the more
relevant expansion of the term ROCE.
Return on Capital Employed was an accounting
ratio conceived for the Industrial Age. Today with the ever increasing share of
services in GDP, capital employed as a denominator hardly offers an insight into
the health of a business. The IT business makes a mockery of that ratio. They
need very little capital employed. Businesses like hospitality no longer needs
to own real estate. There must be a new denominator.
If we consider the NPS ( net promoter score)
logic or the new book Absolute Value ( Profs Simonson and Rosen of Stanford),
there is mounting global evidence of customer experience as the underlying
basis for the long term financial health of any business.
This not strange for two reasons. Firstly, in a
wired world, customer experience is the new brand equity and therefore your
demand driver. (read some of the online reactions that the SIAM defence
generated). Secondly, we know that most of the intrinsic value ( over three
fourths) of a 21st century business lies outside the balance sheet. And the
significant chunk of that is in customer equity or what we call brand value.
