The ability to get to know your customer in order to tailor your offerings to their interests is a skill that many businesses covet, but so few truly practice. Learn key tactics to really know what your customers want and gain a deeper understanding of who they are. Betsy Westhafer and Tony Bodoh welcome guests who do business to REALLY Know Your Customer. Get ready to hear some great advice that will help you sharpen your customer experience to perfection.
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You Have To Have EXTREME Customer Centricity With Kerrie Hoffmann
Digital Transformation Is Not Just About Technology
Our guest is Kerrie Hoffman. Kerrie told us some things that twisted my mind in a great way, got me thinking in a new way about things. Specifically, we’re going to talk about digital transformation and extreme customer centricity.
I have to say, I am excited to have Kerrie on the show. We’ve known each other for a couple of years. We’ve had the opportunity to do some projects together. We’ve traveled together and I’m thrilled to death to have Kerrie here. She is one of my mentors, guides and friends. Personally, I’m excited about this interview.
I’m excited too.
Welcome, Kerrie. We’re happy to have you here. For our audience, I’m going to give them a couple of highlights of your background and your career, but I’d like you to tell us a little bit more. Knowing Kerrie, I know that she is passionate about business transformation and getting as many companies as possible to transform into this new age we’re going into. She’s got a lot going on. She’s got several different avenues in which she does her work. She also has a tremendous pedigree. She was the business unit CIO for Johnson & Johnson, as well as Johnson Controls. With that, Kerrie, I’ll turn it over to you and tell us a little bit more about your background and the work you’ve done and the work you’re doing.
Thanks, Betsy. I appreciate it. I’m passionate about transformation. My whole career, I’ve been doing transformations that have to do with people and have to do with technology. I own and co-own two different companies, one is FocalPoint Business Coaching, which works with small businesses, and the other one is Get Digital Velocity and we work with large companies and enterprises. The focus is the same for all of them. I’m passionate about getting as many businesses as possible to transform from traditional business. That’s from the industrial age to digital business, which is in this next stage that we’re living in.
Kerrie, tell us a little bit more specifically what that means traditional business and digital business. Also, tell us why digital business is a people situation, not a technology play.
There was this exponential growth in technology, the growth of technology and new technology is coming out and hit the exponential part of the growth curve decades ago. It became mainstream in 2007, but what this did is it completely changed the way that we work. I call traditional business as to how we did business in the industrial age and digital business as to how we do business in this next stage that we’re in. One of the key things about the difference in the way we do business is around the customer, and something that I call extreme customer centricity.
Go into that a little bit more. What does extreme customer centricity mean?
The way that businesses need to operate in this next stage that we’re in is they have to be hyper-focused on the customer. A traditional business works from the inside out. What that means is, you’ll contact a customer and an order will come into your business and then it goes through all these siloed departments and out the other end spits a service or a product that goes to the customer. It doesn’t say that you’re not focused on your customer in a traditional business, but there’s this whole process that it has to go through from end to end. Whereas in a digital business with extreme customer centricity, we’re working from the outside in. The focus is on the customer and would change the way we work.
We start to organize in these cross-functional teams that are focused on a micro-segment of the customer. You get out of all these departmental silos and you start specifically focusing on a customer and the issues that the customer is having. One of the key differences is no matter what the size of your company, and this is harder for large companies than it is for small companies, you understand the customer at a deep level. Everyone in your company touches the customer and you understand your customers’ issues. You will solve those customers’ issues whether they have to do with your core product and service or not. That’s one of the key pivotal points in differences.
When people do this, how do they get to know their customer? As you said, they do. What are some tactical ways they go about that?
I love that you asked the question, “What are the tactical ways?” because we don’t have to make this harder than it is. You heard some of the large companies that I worked for and the second half of my career was all in IT, not necessarily the department you think would have customer contact but I required all of the IT people in my organization to go on customer visits. That’s part of the time I was with Johnson & Johnson in the consumer division.
Going on customer visits didn’t mean go to your big box store and observe the customer, it meant to go with your sales and marketing team and understand how they sell to the customer and talk to the customer and go on those customer visits. It is a tactical thing to do, but it’s not necessarily typical. The sales and marketing teams, for the most part, are happy to have other people from the company go on those customer visits. That’s a start. That’s how I started my teams to get to know the customers. We had a lot of work to do to be able to start to form cross-functional teams that are focused on that customer, but that first tactical step is there. You started to understand the customer at a deeper level.
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It’s interesting, you talk about customer visits. I know Betsy and I want real profitability. We were looking for stories where companies did that. It’s not just about journey mapping in the boardroom, not looking at what the customers are going through but it’s getting out on the floor and seeing what happens. We opened the book with the story of IBM CEO, Louis Gerstner, and how he, within his first hundred days or so, required all of his leadership team to be out there in the field meeting with customers.
We went later on and we talked about the former CEO of Pepsi and how she and her team would go out to the grocery stores and to the convenience stores to understand how people were consuming snacks, buying snacks and looking for snacks. That they could reinvent how they were supporting their customers, which were their stores. It’s fascinating to hear you talk about it from that perspective because a lot of times in the B2B world people are caught up in saying, “We do business with other business. It isn’t the same as B2C.” The reality is most B2B businesses, at some point, are B2B2C. There’s a consumer somewhere in there.
That’s absolutely the case. Some of the work that I did with Johnson Controls highlights that. Johnson Controls, the building’s division, they do building automation systems and HVAC equipment, heating, ventilation and cooling equipment. These things are huge. They’re the size of trucks and they’re in basements or they’re on the roof of buildings. It’s very much a B2B business but we looked at it as, “What are we selling? Are we selling HVAC equipment? Are we selling comfort in the building?” It is about selling comfort in the building.
Our customers who were B2B customers, depending on the building life cycle, might be the owner of the building if the building is already built. The owner of that building needs to make sure that it keeps the building occupied. In order to keep the building occupied, your tenants have to be happy. We learned what our customers’ issues were. In a B2B business, you learn what your customers’ customer issues are. That’s a mouthful, your customers’ customer, what does that mean? That means our customer is the business owner or the building owner and the building owners’ customers are the occupants of the buildings. You’re getting close to C, B2B2C. It was critical for us to do that.
We had some interesting things happen in order to create those HVAC pieces of equipment. They’re not standard. There’s a standard part of them but then they’re customized according to the building. There’s a lot of customization. There’s a computer tool called Configure Price Quote, which helps us define what that HVAC equipment is going to look like. We were having some issues with one of those programs. We had an emergency, suddenly this program isn’t working for a part of the business. One of my director’s employees, which is awesome because we had been doing these customer visits, said, “We need to go out to our customer, our distributor who’s having an issue with this. Let’s see what’s happening.”
They jumped on a plane and within twelve hours they were at the customer on a Saturday helping them with the product. It doesn’t matter how long it takes us to fix that piece of software at this point. We have built so much value for that customer and that customer is impressed that we would do that, jumping on a plane and come and see what problems they were having. They were loyal beyond belief after that. We turned a situation that was, “The sky is falling. They’re not happy with us. They can go into a competitor’s product at this point.” We turned it into an absolute positive. That’s a good example of extreme customer centricity.
I love that example and that tie into knowing your customer. We’ve got to get on site to understand. It’s not good enough to do a screen share or let me log in and remote into your computer and see what’s happening. You’ve got to go there and see what’s happening on site. That’s such a powerful lesson, especially in nowadays world. It’s interesting. We’re in the middle of the lockdown with Coronavirus. We’ll be out of this eventually but in some way, because we can’t do these meetings in person or see the customer journey in person, people are finding other creative ways to engage and connect. This is going to catapult us into a new understanding of this idea of extreme customer centricity.
We’re also seeing this dichotomy happening and I call it this dichotomy of paths. There’s the path to bankruptcy and there’s the path to creativity and innovation and growing your business, even though we’re in the middle of this pandemic. I don’t think it matters what your business is. The COVID crisis, what it’s doing is it’s giving us a set of obstacles. It’s a set of obstacles and constraints, but it’s only a set of obstacles and constraints if you think that’s what they are. If you’ve reframed your thinking and saying instead, “These are the new parameters in which I need to work.” You can start to be creative.
It’s interesting. You also cannot be creative if you’re in a state of fear. I posted a LinkedIn article about this. If you’re in a state of fear, there’s a part of your brain, the amygdala, that takes over and that’s the fight-or-flight response. Everyone’s heard of the fight-or-flight response. The reality is when we get into that mode, our whole entire body is controlled by our brain to either run or fight and that’s it and you can’t be creative. You first have to understand, all the obstacles and constraints that I may be feeling are sudden new parameters. I need to think about my customer and even call my customer on the phone, even if you don’t usually do that and say, “I wanted to check in with you. How are you doing? What are your biggest challenges? I’d love to see how we can help.”
If you’re already a digital business, you’re probably automatically doing this because you’re already extremely customer centric. You can already change your products and services quickly. You can change to an alternate business model because that’s what a digital business does. If you’re not a digital business and you’re a traditional business, now is the time. There’s never been more perfect time to start testing the waters of how to do this. You’ve got a perfect excuse to call your customers and see how they’re doing and empathetically listening to the challenges they’re having and then figuring out how you can help, even if that is knowing someone who could help them, that’s going to build a lot of trust. If you go back and you think of all those obstacles and constraints as new parameters, you can start to think of, “What can I do next?” There’s a great example of this in the restaurant business.
Kerrie, I read your article on LinkedIn. It was a great article. I shared it. Give us a couple of the examples that you mentioned in that article about the choice you have to make, the two paths. You gave a couple of good examples of what that looks like. Can you share some of those with us?
I’m going to talk about the restaurant business because we can all relate to this. We see a dichotomy of paths in the restaurant business. We’re seeing the business owner who tweets, “I’m doomed. We’re going bankrupt. I’m laying off all my employees.” You see the restaurants that are reinventing the way they work. I’m not talking about the restaurants that already had drive-through and already had delivery, they’re fine. What about the mom and pop restaurant or the fine dining restaurant that only had in-house dining? This is where we’re seeing the dichotomy and those that are excelling.
There’s a source at the bottom of that LinkedIn article where you can directly read an article about this, a restaurant in Seattle is the example. They took their fine dining restaurant. They changed their service staff, their waiters and waitresses to be delivery and drive up. They put a quick program in place to order online but you don’t need to do that. You have a phone number as a restaurant, people can call in their orders. With the resources you have, you can complete your business model. These fine dining restaurants are starting to catch on. They’re even changing their menu and saying, “What do people want at this time?” We see all these food packs where you can go online and you can order a pack from a restaurant and be like, “Here’s the taco pack, five tacos. Stuff for a family of three, stuff for a family of four.” You order it. Why are they doing that? They can quickly put those together in a way that will work for them and will work for their customers, completely different paths.
The same exact dine-in only restaurant, one failing and one reinventing themselves with or without technology. Start without the technology, if you don’t have it and then add it. There are technology companies out there who can create things for you in days and weeks because they’re completely digital and using modern technology. There’s even one out there that will help with putting online ordering up for you in a couple of weeks. That’s one of the examples of how you can take these constraints and obstacles and say, “These are my new parameters. What do I need to do?” There is another article on a restaurant, one was San Francisco and one was Seattle. There’s a taco place in Seattle that was dine-in only and their business has quadrupled. They’re growing their restaurant business in the crisis.
Isn’t amazing how mindset is everything in this?
Absolutely, and having a digital mindset is important. A digital mindset isn’t what you think. I have these five parts of a digital mindset and one of them is technology but the most important one is a mindset of abundance. It’s believing that there’s an abundance out there. Although our abundance shifted dramatically with what we’re undergoing in the entire world, there is still abundance out there. There’s an abundance of needs. There’s an abundance of ways that you can approach it to be able to get there. We’re seeing a lot of companies stepping up and starting to make ventilators that have never made ventilators before. That’s an idea of abundance.
I threw an idea out there on the article because people will say, “Kerrie, Las Vegas has shut down. They’re doomed.” I’m like, “Are they? There’s Amazon hiring 100,000 workers. There are grocery stores hiring to keep up with the load.” What if we created a way to be able to take the employees from one industry and lend them to another industry while this is going on and then take them back after? All these employees that are needed in the industry are to get food out to people. They’re not going to need them when we come out of this. They’re not going to need all those people so they’re going to have to go back. Why don’t we create ways to make that easier? That’s an idea I threw out there. Whenever I come up with an idea, someone’s already thought of it and it’s happening somewhere out there. That’s my theory when I come up with an idea, never unique.
You talked about the hotel industry and you talked about Las Vegas. I spent a good portion of my career in hospitality working for Gaylord Hotels and I’ve consulted for hotels after that. One of the things that I know the mindset for most hoteliers is it’s about the building, the physical asset and they invest all this money. The room in a typical hotel in Las Vegas could be $400,000 to $500,000, to build that room, the hallways, the associated structure and all that. They think about the marble countertops and all of that, but they don’t realize that the experience is about the human connection. It’s about the immersion that people have while they’re there. Not all hoteliers but many of them. Because they don’t understand why people are there and the experience they want to have, they can’t use this digital mindset you talk about to shift their business.
I’m sitting there thinking like, “You’ve got all of these guestrooms there. I don’t know what you’re going to do with those but there’s probably something, maybe we could switch over to be a hospital for a period of time.” You’ve got these big conference rooms. You don’t want people gathering those conference rooms but you could have less than ten people putting on a virtual conference from your hotel so you get all the branding all the advertising, “We’re doing this virtual conference at the,” fill in the blank. There are ways that they could be creative and use their facilities and still make money. They may not make as much money but they could be making some money. Your digital mindset, looking at some of these what we might call traditional industries, service industries, if they rethought themselves in a new way, they could come out of this ahead.
Some states have already said this is going to go on. People are getting tired of working from home. It’s a perfect opportunity for a hotel space to create work from the hotel instead. Maybe you can rent a hotel room for a month and it’s only yours and you only go in it and everyone’s 6 feet away. Why wouldn’t that work?
That’s a great idea.
Kerrie, I might disagree that every one of your ideas, somebody else is already working on because that sounds like a novel approach. Kerrie, I wanted to talk with you one of the ways that we’ve worked together as you’ve served on a customer advisory board for a client of Congruity Group, our company. When you talk about extreme customer centricity, can you talk a little bit about how important it is to listen to your customers directly and get that feedback and how that feedback should be received and acted upon?
Customer advisory board has done the way that the Congruity Group does them are awesome because it’s bringing your customers together, a set of your customers together and having intimate conversations with them about your strategy and your roadmap and getting their input about what their needs are. It can help you understand how your products, services and even business model need to change over time. It gives you a lot of momentum to go in those directions when you hear it directly from your customers, but you have to hear it, you have to listen. It has to be mostly listening to the customer and then they need to see the actions that you’re going to take in order to get there. They want to see that they’re being heard and that it’s making a difference.
How does that impact the relationship between the supplier and the customer?
The customers that participate in those customer advisory boards, they end up feeling like they’re a part of the company because they are. This is what extreme customer centricity is all about, making your customers part of your company. Tony, I love your discussion on hotels and how a lot of them focus on the building but it’s about the experience and the people. I spent a lot of time in Asia. I’ve had global teams for decades. I lived in Asia for three years. A five-star hotel or even a 3 or 4-star hotel in Asia is nothing like a five-star hotel in the US. They are much better. Why are they better? They get to know their occupants. They know the people who are staying in their hotel. They have a level of service that we don’t even understand in the US.
When my family first moved to Singapore, it was 2008. We stayed for a week in a hotel and that hotel greeted us by name every time we walked in the door. They also had this awesome restaurant. I have to say that buffets In Asia are nothing like they are in the US. Don’t get this, US, if you have a buffet. They’re special. We went back to that hotel two months later to go and have a buffet on Sunday because it was awesome. They knew our names, we’re like, “How can they possibly remember us?” It was 2008, I don’t think they were using any facial recognition software back then but they may have been. It doesn’t matter. They knew us by name. When my parents would come to visit once a year, they learned their names. Once a year, we’d bring my parents and they would know their names. It’s a level of service that’s unprecedented. We don’t see that in the US.
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It’s fascinating that you bring that up because when Betsy and I were reading about profitability, I went back and did some research because we’ve seen this happen over time. You mentioned 2007 and the exponential change in technology. I want to go back to that, putting a little marker there. What we found in the hospitality industry and it’s just no here but in particular, we use this example. We looked at ten of the largest markets in the US like Chicago and Philadelphia or Pittsburgh. We went through the ten top markets in the US. We’re able to identify on TripAdvisor that you had these 2.5 and 3-star hotels that were ranked in the top levels of TripAdvisor. They were dramatically outranking the 4 and 5-star hotels in the same city.
Some of the deeper research that led me down this path to use this as an example in the book was, if you go to TripAdvisor or any of these other social sites, 95% of the five-star reviews mentioned the human connection. It’s with someone at the front desk, the general manager, or it was with the housekeeper. It doesn’t matter who it is but there’s this human connection. If you go down to the four-star reviews, there’s almost no mention of humans. They disappear until you get down to the one-star reviews where it’s like, “They stole from me. They destroyed my reputation. It was horrible. They were rude.” If you understand that, it’s this human connection that people want. It’s not just a comfortable bed. You can get a comfortable bed anywhere. It’s a commodity these days.
To have people who can engage with you and have that relationship, even if it’s for a moment, that’s what makes a huge difference. I find it interesting because the hotels in the US have yet to learn this. Their digital mindset, if you want to talk about that, is we need to get an app. We need to make it so everyone can check in without ever talking to someone. My opinion of that is you’re trying to get rid of the human being because you haven’t figured out how to hire and train people properly.
Make them care. What’s the big ‘why’ of your business? You have to care. There has to be a common big ‘why’ everybody buys into and everybody understands. Whether it’s a vision statement or not, it doesn’t matter, it’s your big ‘why’ and everybody needs to know it and live it.
That’s the key right there, living it. A lot of companies, and we’ve all heard this story about how they have their mission on the wall as you walk into the entry of the building and all of that but it’s a matter of the employees understanding it at a deep level and living it.
That goes two ways because there’s the ‘why’ of that company with Simon Sinek, he’s done a great job as a proponent of that idea. One of the elements of the show, know your customer. It’s also about, what’s the ‘why’ of your customer? You talk about the extreme customer centricity and micro-segmentation. When you understand the ‘why’ of your customer, it allows you to see the abundance and to be in this digital mindset where you transform. As an example, I’ve been working with some clients that are in the health and well-being space. One of them has a yoga studio. Their customers’ ‘why’ is about community. It’s not just about yoga and the health and well-being, it’s about community.
We did some strategy sessions. The moment that we saw what was happening and it was likely that they’re going to have to close, this is about a week before they had to close, we started going through the process of understanding, what is your customer’s why? They knew this in advance. We’ve been working together for a while. They’ve got an entire community an online platform. They positioned themselves that they can start advertising and picking up clients from other yoga studios that have closed down and don’t have an alternative because they don’t understand their customers’ why.
That community is key. You can do online yoga. Who can’t do online yoga? Why wouldn’t your customers want to be together when they do it like they usually are? Otherwise, they wouldn’t have been in the studio.
They see each other on Zoom or whatever technology you’re going to use. They feel, at least, a connection. What’s fascinating is the feedback that they’re receiving from their customers, their members are like, “Thank you so much for doing this. There’s this desire for connectivity and community because we’re all isolated.”
A little bit of normalcy, because going to the yoga studio was part of their routine. You still need a routine. If that routine can have some of the same things, even if it’s in a different way, then you’re achieving that.
That’s where that digital mindset of being able to think about your business in a different way and still achieve many of the same outcomes from the customers’ perspective.
Another part of the digital mindset is comfort with ambiguity. We’re in an ambiguous situation with everything that’s happening and it’s throwing people for a loop. If you’re comfortable with ambiguity and this thing called VUCA: Volatility, Uncertainty, Complexity and Ambiguity, then you can say, “I’m in this situation with all this ambiguity. I’ve gotten good at it. I’ve got a mindset that I can handle this.” You can then again be creative and come up with solutions.
Kerrie, how do you see this pandemic impacting your mission of trying to help companies transform?
For me, everyone’s gotten a shot in the arm, “I do need technology.” Remember, technology was the trigger. In order to keep up with this increasing pace of business that we’ve seen, you have to use technology. In order to work from home and work remotely, you need to use technology. Let’s not make it more difficult than it is. You don’t have to know how to implement artificial intelligence, as an example, to take advantage of the digital business in this next stage wherein. You need to use partners who know how to use it, even understand that you are already using it anyway. All the things that Amazon says, “You bought this. Maybe you would like that.” That’s artificial intelligence.
I used the Waze program for transportation when I used to drive and that would save me hours of time and traffic. I have a mileage program that automatically tracks my mileage for me and all I have to do is add a business purpose. It’s all using artificial intelligence. You have to be willing to use the platforms that are using modern technology. One of the reasons Zoom is getting so much attention is because they’re digital, they were born digital and they have a modern architected platform behind what they do. They were able to scale up to 500 times their previous capacity easily. Everyone’s like, “Use Zoom because it works.” It regulates our audio. It regulates our video. It ramps down the video if we have a low internet connection. There are all kinds of things that are built into it, that’s technology, this technology that became mainstream in 2007.
You hit on something with partners. You don’t have to recreate the wheel because a lot of those assets that you need are already out there. I can give you an example of something that we’ve done as a pivot due to this. We now have the option to do digital customer advisory boards and we’ve partnered with a company that’s already built that technology. It’s got AI built into it. It’s an awesome platform that we are partnering with them where we add our advisory board expertise and services but we have this technology that we didn’t have to create ourselves. With the way the world is, that’s necessary because if I wait till people can fly and go to hotels and be together again, it may be a while.
We have to be careful with technology to start using it and use what’s good enough. Betsy, you and I have been talking about creating an app. What’s the ultimate app that would be awesome for your business and for my business? There were overlaps. We were talking about this. There are enough apps out there that we can use in the interim in order to do our business. You need to look for what’s good enough and be creative. Look at those obstacles as parameters and say, “I have to pivot my entire business. Let me use what’s out there.” Instead of thinking, “I need to create something new.”
We have to pivot as humans. I started writing an article, I haven’t finished it yet, the title of it is When the Unimaginable Becomes Better than You Could Have Imagined. The story I’m telling is about my son’s wedding. It was unimaginable to me that I wouldn’t be able to be there for his wedding. The way it all played out, we watched via Zoom. It was a beautiful, intimate moment between the two of them.
They’re happy as can be because they’re done worrying about all of this. They can get back to their daily lives. It was more beautiful than I could have imagined. Not only do we have to pivot as businesses but we have to pivot as humans and realize that I had this limiting belief that the world would crash to a complete stop if we didn’t have the wedding that we’d been planning for eighteen months. In reality, it was a limiting belief because we ended up having a wonderful outcome for this. That was something that struck me about what you said.
The path to bankruptcy is the path to stopping. It’s a path to stop it or it’s a path to go forward. Those are the two paths. That is a perfect example, personally, because there are a lot of people canceling their weddings, postponing their weddings, but then there are the people having them and they’re having the most historic weddings ever.
The stories they’ll be able to tell their children and grandchildren about how their wedding happened. As business leaders and as people, we need to be okay with stuff that we weren’t okay with before. We have to accept the things that are different and out of our control and be okay with things more than being locked into what we think should happen.
This is one of the things I love about what’s happening, I’m the ultimate optimist so I’m always going to see the bright side. I’ve been allowing people in my teams to work at home for decades. I was always tolerant of the dog in the background, the kid in the background. You being in a room with other people working remotely on the phone and a dog would bark, why is that a problem? I love it because now it’s not a problem. In fact, people are picking up their pets and showing them on the camera to say, “Meet my pet.” It’s weird, we’re having a more human experience in some ways even though we’re remote and we have to use those ways to have a human experience.
Even before we were officially locked down, we were supposed only to be going grocery shopping but people were doing much more than that. On both sides of my family, we were staying at home. We had a six-family FaceTime call because everyone happened to have Apple phones, with my side of the family. We had a virtual pizza night with my husband’s side of the family because we have pizza night every once in a while. It’s funny, the first thing everybody on my husband’s side of the family was thinking about including us was, “How can we do pizza night? We still have to do pizza night.” We did pizza night on Zoom and it was awesome. It was 1 hour and 45 minutes of conversation and people saying, “You look funny eating pizza over video.” You do look funny eating on video, but why not?
You have to look for those opportunities proactively. My husband and I played Yahtzee with our grandkids over Zoom because we can each roll our own dice. We can keep our own score. It’s one of those games that you don’t have to all be together. What are some of those other games? We’re starting a chapter book and I’m going to be reading to them a chapter a night. That’s what I love about what’s going on because it’s forcing people and business owners to be creative where they didn’t know they had the capacity to be creative. They’re being forced to be creative.
We’re starting to get a critical mass of people who are in this mindset that not only can we get through this and will we get through this but we can be better off through this. Helping other people understanding what they can do whether it’s personal or business is important. The main point of my article is we have to keep the economy flowing. We have to stay safe and we have to keep the economy flowing. We can’t kill the economy because of this, and we don’t have to as long as we’re taking all the obstacles and constraints and reframing those as the new parameters in which we need to work.
One of the things that strike me in our conversation here, Kerrie, is that Betsy and I talked a lot about the transformation of economy in profitability. That’s something I’ve been talking about for well-over a decade. It goes back to the book, The Experience Economy, which was written in ‘98 or ‘99. Pine and Gilmore, great, brilliant gentlemen, they had this idea that there are these five stages of economic growth that we’ve seen, it’s from the commodity economy to the product economy to the service economy and we were in the experience economy in the late ‘90s and all the way up.
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Customer experience is the outcome, if you will, is almost like a manifestation of being in the experience economy. I’ve been talking about this for several years, we’re the transformation economy which is the fifth stage that they briefly touch on in the original book. The transformation economy is emerging and it has been for a while. The difference between the experience economy and transformation economy is part of what you’re talking about.
The experience economy is all about making memories and selling feelings. What are people going to feel? The transformation economy is where the customer is the product because you’re transforming who they are in the process of delivering your products, services and experiences. You’re guiding them from the self-identity they had. This is where it comes down to. We all have a self-identity. We all have an identity of how we fit in the world, in business and personal life. We’re radically redefining that because we have to.
The path to bankruptcy is the path of saying, “This is who I am. This is my identity. This is how I work. This is how I live. This is how I engage with my family.” We are being forced to transform that. It is going to catapult this whole idea of the transformation economy that Pine and Gilmore talked about years ago into the limelight where people are like, “What we’re selling is not a product, service, commodity or an experience. We’re helping people transform into who they want to be.” That’s what Zoom is. Zoom allowed Betsy’s son and daughter-in-law to become a married couple with their family involved. That is something that Zoom doesn’t have anywhere in their mission statement, I’m sure.
Everybody had a front-row seat. How cool is that?
One of the coolest things was the virtual background that Zoom allows you to have. Many of us that were watching the wedding grabbed an image from the venue where they were supposed to get married and use that as our virtual background. I doubt that Zoom could have ever imagined that that would be the scenario when they were crafting the technology to go behind this virtual background thing they have. It’s how things are evolving in such a cool, creative way. We’re going to have some phenomenal outcomes from this. One of the other things I was going to mention is sometimes when you read articles about companies and how they got to where they are now, a lot of times they started off making something completely different than what’s made them successful. You see that all the time in articles.
I’ve been fascinated with virtual reality for decades. It’s been out there that long. There is something called Second Life that’s been out there for a long time. There’s an experience beyond having the same virtual background that’s in virtual and augmented reality, and that is going to become more and more used as we transform. It’s going to be part of the transformation and it’s cool. I don’t know the name of the company. I need to look it up.
Singularity University was holding a three-day COVID-19 conference and they had a whole session on virtual reality. There is a real estate company in Europe, they have over 20,000 employees and it’s completely virtual. It’s funny, they don’t own any buildings, they sell real estate and they’re completely virtual. We’re going to start seeing that coming too. That goes back to this exponential growth in technology we’ve been seeing. I don’t know, Tony, if we have time to talk about 2007.
Let’s hit on that because of 2007 in my world, from a customer experience perspective, is significant. The first book I wrote taps on this topic. In 2007 is when the iPhone came out and it coincided with the recession. I talked extensively about that. I want to hear your perspective on what happened in 2007 and why it was significant.
I have to reference a book on this and it’s not one that I wrote. Most people know Thomas Friedman because he wrote the book, The World Is Flat. That’s decades old. He also wrote a book called Thank You for Being Late. In that book, he has a whole chapter that’s called What the Hell Happened in 2007? Not only did the iPhone come out in 2007, but IBM Watson started to be worked on. LinkedIn and Facebook became popular. GitHub, which is a site for code and collaborating on code came about. There are dozens of technologies, both computer and energy-related, that all hit an exponential part of the curve in 2007. The significance of 2007 is these technologies that had been being developed for almost a decade by that point hit the mainstream and people started using them. They started to get combined into platforms and they started enabling us.
It was fascinating for me to live in Asia in 2008, 2009 and 2010 because Asia was adopting these technologies much faster than the rest of the world. I worked in a multinational company at that time which understood global but we still called certain emerging market countries and I’m like, “There are no emerging countries anymore in Asia.” There are still some emerging countries in Africa at that time but there are no emerging countries in Asia anymore. There are emerging parts of those company countries but those countries were well beyond what was happening in the West at that point. As an example, there were several countries in Asia in 2008 that were doing banking on their phones. They skipped credit cards because people used to keep money under their mattresses and then they went to banking on their phones.
In order to make an appointment in Singapore, it was all through text. The iPhone did not come out in Asia until 2008, it was a year later but they already had semi smartphones that they were using. When I got there, I was told, “You need to pick your phone.” I’m like, “What is it? A BlackBerry or flip phone?” My administrative assistant gave me a spreadsheet of 60 phones to choose from, I’m like, “What the heck?” They were using their phones at that time for not only voice and text and email but at least ten more things they were using their phones for.
The transformation started in Asia, I would say, are about the same time technology hit the exponential part of the curve. They had this hunger of being emerging markets. They had this hunger bringing 80% of their population who used to not be in the lower class and bringing them into the middle class in the upper class. By 2008, the middle and upper classes of China were bigger than the whole population of the United States. We had our eyes closed back in the West. There are many examples. We brought that example up earlier of hotels being much better. They were already much more into the experience economy at that point and they were already in the transformation economy.
We’re seeing some of the Asian countries being able to react to the pandemic that’s going on. They can set up a hospital in no time. Have we been able to do that in the West? Not really. They’re much better wired. They skipped wires in a lot of places and went to Wi-Fi. There are a lot of parts of Asia that don’t have electricity but they all have phones because years ago they put a pole with a solar panel on the top and in the center of the village is where you charged your mobile phones. Everybody had mobile phones even though they didn’t even have electricity. That’s taking a different approach to your obstacles and saying, “These are new parameters.”
Kerrie, a question for you, we’re going to shift a little bit. We like to ask our guest, what do you do with regard to supporting your community? Is there an organization that you’re heavily involved in that you want to give a shout out to? Tell us a little bit about them.
I’m heavily involved in two. One is the United Way, the local United Way. We have a group within there called Technology United. It’s similar to other affinity groups within the United Way like Emerging Leaders or The Women’s Group. We’re all people that have to do with technology. We’re doing a lot in order to bring STEM-related things, Science, Technology, Engineering and Math, down to the lowest levels of schools and getting people interested in going into technology as a career. If there’s one career that’s growing rapidly, it’s definitely technology.
The other one that I’m very much involved in and on the board is Girl Scouts. I’m on the Girl Scouts of Wisconsin Southeast. I’m a board officer. I’m passionate about the organization and the mission of that organization is to grow girls into leaders. It’s personal for me. I was a girl scout all the way through high school. At Johnson & Johnson, great company, huge emphasis on diversity. When I joined Johnson & Johnson in 1995, 35% of the top were already women, which is high for that time.
We’d have all these panels. As you got into vice president levels, you’d be on these panels and people would ask you, “Where did you get your leadership skills?” It was intuitive to me to say, “Girl Scouts.” I learned leadership skills in Girl Scouts and it has been an amazing value to me in my life. There are all these real stats. Eighty percent of the women senators were Girl Scouts. One hundred percent of women astronauts were Girl Scouts. It works. I’m passionate about the Girl Scout Organization.
Kerrie, we know you’re on LinkedIn. How else can people reach out to you?
If you go to KerrieHoffman.com, there’s a way to reach out to me. You can read a little bit about both the FocalPoint and the Get Digital Velocity businesses that I run. That’s probably the easiest way.
It’s been a pleasure having you, Kerrie. You took what we talked about in our prep session even further. I’ve got all kinds of notes I’ve been taking here. I hope our readers have been taking notes too because there is so much that we can learn from what you’ve provided to us already. I’ve got one last question, are you a Packer fan?
I have to be a Packer fan.
I grew up in Wisconsin, so I understand.
I would have to admit that I’m more of a baseball fan than a football fan.
Kerrie, thank you. It is truly our honor to have you on the show. Every episode we talk about how we want people to not only just read this episode and absorb the knowledge that our guests have to offer but also to take action. I feel like you gave us many ways that help people take action, particularly what stands out in my mind is to go out in the field with your sales and marketing people. That’s something that people can do. We appreciate all of the insights you gave us and in such an actionable way. Thank you for being our guest.
Thanks for having me, Betsy and Tony. I appreciate it.
What a fascinating interview. The whole idea of the extreme customer centricity, a lot of companies talk about that. A lot of consultants talk about customer centricity but Kerrie takes it to an entirely different level. When you partner that with the digital mindset, which they can’t be separated when you hear how she talks about it, that digital mindset of being able to look from the outside in and build your company inverse of what you may have done in the past, in the more industrial age as she called it.
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Kerrie is one of those people that I could hang on her every word. She takes you deep into the concepts that she’s talking about. We learned so much from our guests and that’s why I get excited to share these episodes because I know our audience will learn a lot as well and as we talked about in the interview, all actionable things that people can do and take from what she had to say. She’s phenomenal at this whole thing that she’s passionate about. It goes to show, when you’re passionate about something and you dive deep into it, how much value you have to offer others.
One of the things I love about getting to know Kerrie as we’ve talked with her is you and I talked about knowing your customer, she took this career, this corporate career and in that, got to know her customers. The work she’s doing is turning back to where she used to work, and with those companies both the large and the small businesses, in her different businesses. She knows what her customers need to know. She understands her customer. It’s awesome to see that evolution from where she was in the past years to where she is now and then to be able to bring that to our audience so that they can learn what that looks like and how they might be able to put that into place.
Thank you for being here. We are honored that you chose to spend your time with us. We look forward to seeing you next time on the show.
- Kerrie Hoffman
- Kerrie Hoffman – LinkedIn
- Kerrie Hoffman – Twitter
- Kerrie Hoffman LinkedIn Article
- FocalPoint Business Coaching
- Get Digital Velocity
- United Way
- Technology United
- Girl Scouts of Wisconsin Southeast
- ProphetAbility: The Revealing Story of Why Companies Succeed, Fail and Bounce Back
- The Congruity Group
- Tony Bodoh International
- ProphetAbility Membership
- ProphetAbility for Teams
About Kerrie Hoffman
Kerrie is passionate about business transformation and getting as many companies as possible on their journey to The Next Age™. Kerrie is a #1 Bestselling Business Author and CEO of Hoffman Digital, an ecosystem of companies “Igniting the Human Experience at Work”. This includes Strategic Advisor at several Modern Technology Companies, Co-founder and Partner at Get Digital Velocity, and Digital Advisor and Certified Business Coach at FocalPoint Business Coaching. In addition, she is a Keynote Speaker at Industry venues and Chairman of the Board for HashedIn Malaysia.