The era of big-data-fueled agile product development has opened unprecedented opportunities. More than ever before, companies have the ability to create winning products by deeply understanding customer needs and trends within market segments. And, according to a new Chief Executive survey of 233 U.S. CEOs, conducted in June 2021 in partnership with Amazon Web Services, America’s CEOs are taking advantage—focusing significantly more on the customer experience as part of their innovation efforts.
But it isn’t all good news. Many admit to struggling with some of the fundamental elements for sustained success—especially when it comes to translating data into useful insights in a timely way. In the survey, 55 percent of respondents said meeting end-user/customer expectations was the top driver of innovation at their organization—ahead of all other drivers, including improving efficiencies and growth, by significant margins.
Yet, the CEOs participating in the study reported not being fully satisfied with their organization’s focus and understanding of the customer experience, rating those elements a 7.6 and 7.2 out of 10, respectively on our 10-point scale. They’re even less satisfied with the accessibility and transparency of the data across the organization—which polled CEOs rated a 6.7/10 each—limiting the ability for people to act fast based on customer insights.
“We have access to a lot of different data,” Steven Leafgreen, president and CEO of Western Vista Federal Credit Union said, echoing the sentiments of many of the survey respondents. “The key is sorting through all the data and finding what is actually relevant.”
“While accessible and transparent, a bigger element for most businesses, including ours, is the business leaders to know how to harness the data,” echoed the CEO of a digital health & wellness retailer. “The ability to turn data into insights and, more importantly, actions is a tough one to hire at the levels needed for success.”
Another challenge highlighted by the survey findings is the ability for organizations to use customer feedback and requests to drive their innovation cycle. Overall, 54 percent said customer insights drove nearly all or most of their innovation. While a significant number in itself, this indicates that nearly half (46 percent) of companies may still prioritize other focuses to inform innovation over customers’ needs and requests.
While there are many ways to approach innovation, Dan Slater, Worldwide Lead, Culture of Innovation, AWS, says Amazon’s philosophy is rooted in the core belief that organizations should “start with the customer and work backwards” from there.
“Approximately 90 percent of innovations at Amazon come from analysis of customer behavior and desires, and the rest from the company proactively innovating on the customer’s behalf,” he says. “For example, customers did not ask specifically for the Prime membership program, but once available, it became a highly popular offering.”
He says companies seeking to further their innovation culture can utilize a working backwards technique as a simple exercise to envision future products and services from a customer perspective. He explains the technique and Amazon’s approach in greater detail in a new post. Read more here >>