Tuesday, August 11, 2015

Outside-In vs. Inside-Out Thinking

Image courtesy of 10ch
In the world of customer experience, what's the difference between outside-in and inside-out?

Inside-out thinking means your focus is on processes, systems, tools, and products that are designed and implemented based on internal thinking and intuition. The customer's needs, jobs, and perspectives do not play a part in this type of thinking; they aren't taken into consideration. You make decisions because you think it's what's best for the business - not for customers. Or you think you know what's best for customers.

On the other hand, outside-in thinking means that you look at your business from the customer's perspective and subsequently design processes, tools, and products and make decisions based on what's best for the customer and what meets the customer's needs. You make decisions because you know it's what's best for your customers. Why? Because you listen to them, and you understand them and the jobs they are trying to do.

It might be inside-out thinking when there's a conscious decision to make process, policy, people, systems, or other changes that:
  1. Don't improve the customer experience at the same time
  2. Are about maximizing shareholder returns, not about benefits for the customer
  3. Improve internal efficiencies but to the detriment of customer interactions
  4. Are cost-cutting measures that also negatively impact the  customer experience
  5. Might be the wrong process, policy, people, or systems to change
By contrast, outside-in thinking flips each of those points on its head and looks like this. There's a conscious decision to make process, policy, people, systems, or other changes that:
  1. Improve the customer experience at the same time
  2. Are about maximizing benefits for the customer
  3. Improve internal efficiencies known to be painpoints when executing customer interactions
  4. Are cost-cutting measures that significantly improve the customer experience
  5. Are the right process, policy, people, or systems because you've listened to customer feedback and know how customers are affected
It's clear that outside-in thinking is the way to go. It leads to a number of things, none of which you'll get by making decisions that are not based on what's best for your customers...
  • reduced complaints
  • increased satisfaction
  • increased referrals
  • increased repeat purchases
  • improved ease of doing business
  • fewer lost customers
These then translate to reduced costs and increased revenue for the business.

How can we ensure that we're operating in an outside-in manner? Here are some tips.
  • Understand customers and what they are trying to do
  • Use that understanding to develop products for the customer, products that solve their problems and help them do what they are trying to do
  • Listen to customers at all key touchpoints
  • Close the loop with customers on their feedback
  • Act on what you hear
  • Share the feedback and ensure it's used throughout the organization to make decisions and to design the best experience for your customers
  • Do right by the customer; ask "Is this decision what's best for the customer?"
  • Reduce customer effort rather than making the experience convoluted and confusing
  • Save a seat in the room (a la Jeff Bezos' empty chair) for the customer/customer's voice
  • Map customer journeys and ensure all employees - frontline and back office - have a clear line of sight to how they impact the customer experience
  • Talk about customers and what they are saying
The customer and his voice need to be incorporated into all decisions, design, and development. Weave the customer throughout your organization's DNA and watch what happens.

When you’re trying to make an important decision, and you’re sort of divided on the issue, ask yourself: If the customer were here, what would she say? -Dharmesh Shah, CTO of Hubspot


4 comments:

  1. Annette I enjoyed this post a lot. Though I'd like to challenge it in one way.

    I think that both inside out and outside in thinking should work on processes, tools, systems and products. The difference is "How?"

    Outside in thinking focuses on customers
    Inside out thinking focuses on profits

    And there in lies the mistake.

    Chase the vision not the money, the money will end up following you ~ Tony Hsieh

    But then, as a process guy I would say that wouldn't I?

    ReplyDelete
    Replies
    1. Ah, yes you would! I love the quote from Tony, though.

      Delete
  2. Thanks for letting know about so many information about outside in vs. inside out thinking. Here provided tips are truly useful. Following these tips will surely translate to reduce costs and increased revenue for the business. Monitoring your metrics is definitely key and simple tools are a great way to do this (like PanXpan's finance summary module).

    ReplyDelete