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  • Writer's pictureTerri Lucas

Mind the gap - why closing the boardroom customer skills gap really matters

Every organisation in the world claims it is customer focussed. Yet words and actions don't always align

I am often puzzled by the set of skills sought after for board directors being narrow, whilst board responsibilities expand. I have lost count of the role profiles I’ve read which highlight financial, risk and compliance backgrounds being the essential skills. Very few ask for commercial or customer skills for example, yet almost every organisation in the world claims it is customer focussed. It begs the question why are some skills so highly prized, whilst others are not? Does it matter if a board is made up of a diverse group of experts in all fields, or are traditional financial and governance capabilities sufficient to create lasting, sustainable businesses that customers love?

It is time for me to solve this puzzle, so I did some research around the topic. Commentators often talk about the lack of diversity at the top table (for example by gender, ethnicity, ability, age, class) with that space well-covered in articles and posts. Others highlight the growing need for functional expertise in the boardroom, such as digital, sustainability and market expertise, for example.

Given I am a marketer and non-executive director, I explore having customer facing, commercially minded people on the board, and the invaluable contribution they make. Before I do so, I believe every board needs its finance expert, and a committed focus on risk and compliance. These are critical skills for knowing the organisation is well governed. This blog is about complementary capabilities that drive deeper understanding of customer risk, and how to improve overall performance.

Does a gap really exist?

I spoke with Fiona Hathorn, CEO of Women on Boards, and asked her if a gap exists: “Almost all boards rightly focus on conformance - ensuring the organisation adheres to the rules and regulations of a particular market. Yet, boards should also be driving performance, which has customer experience at its heart. In my view, only the stronger boards are able to do this well. Shaping strategy as a board is one thing, but monitoring and adapting it to fast-changing markets is challenging for all boards. Having a customer perspective embedded around that boardroom table is critical to the ability to do this effectively.

Fiona went on to highlight practical steps to improve customer centred decision-making: “There is an optimum size for every board, which means, in practice, board members cannot solely focus on one narrow area of expertise. Bringing the voice of the customer into board meetings, using data and qualitative insights, to enable smart decisions is key to involving all board members in delivering on customer focus."

Remit of the board has broadened

Look at the last 10 years. There is little debate that the remit of the board has broadened exponentially. Responsibilities have expanded to include things such as regulatory knowledge, understanding cyber-risk and technology. Resilience and the ability to respond to crises are also capabilities which have been thoroughly tested recently. Covid 19 is the perfect example of dealing with an immediate situation that took operational planning, technology, customer and employee care skills, as well as managing the finances and cash flow. For some, revenue streams dried up and consumer habits changed for ever. Taking the learning onboard and future proofing all of your business risks is the name of the game.

Commercially-minded marketers have a lot to bring and can help you shape your business to better reflect customer needs, driving up revenue and mitigating a key risk.

Connecting the business to the customer, end to end

The marketing leader automatically connects marketing strategy to business strategy and operations, financial performance, and in doing so, creates long-term value. They have a different profile to the CFO or the risk specialist, being close to the customer every day, staying abreast of trends, and bringing a deep level of insight into the boardroom. For example drawing out the things you do that lose you money (that must change), the things you do which generate the best returns (that represent future potential business).

The insights create valuable understanding of how to maximise satisfaction and profitability. Marketing also gives you your source of competitive edge and a method for innovation. If you don’t have this, you will struggle to pick up the best quality business and may watch a competitor take valuable market share, because the customer truly is king for them. The director (with commercial experience) will make sure you are ready for the future, with information enabling smarter decision making, enhanced by an enriched understanding of your customer. This translates into improved bottom line performance, and satisfied customers who return because they prefer you and trust you to deliver. This is vitally important information in the boardroom, giving you clues how to evolve, innovate new products, all part of de-risking and delivering strong financial performance.

Does this make sense? It seems a logical argument, yet so many businesses talk about the customer being at the heart of it, without listening to them regularly or making sure that delivery is the very best it can be from the customer perspective. If you don’t discuss some aspect of the customer at every board meeting, you really aren’t being putting them at the heart of things in the way you could. One has to ask - 'Why wouldn't you?'

Ideas for amplifying the customer voice

If you feel your customers deserve more focus from you, here are a few ideas to get started:

1. Be clear on your strategic priorities. Assess the skills and board composition against those priorities. If you have all bases covered, great. Keep at it. If you don’t, the assessment will help you identify the gap(s) you must close

2. Embrace new models. For some boards it may be possible to appoint a non-executive director with a commercial marketing background, who works with you to make sure the customer focus is strong and omnipresent. But this may not be the right model for you. For others, setting up a customer advisory panel (that reports regularly to the board) is a good way of upping its game, and a systematic way of improving your listening skills

3. Rebalance the board agenda. Rebalance your meeting agenda to make sure meetings are sufficiently informed by customer data and views. Have some method of tracking progress in the packs regularly, to check the effectiveness. Make sure any big decisions are informed by customer information, not in isolation of the people who pay the bills and salaries of your team

4. Be open to others. Have an honest conversation about the company’s openness to people with different backgrounds and capabilities, and make sure you address any mindset changes that need to happen before you go out to market. Sounds a small thing. In truth, it is one of the biggest barriers to address, to successfully close your skills gap. If you say you want someone with strong market creds, then hire someone like you with a compliance background, nothing will change. What you say and what you do have to align. Leading from the front on this is the secret sauce

5. Broaden the hiring pool. Consciously broaden the pool of people you engage with to find new and different talent that your board is missing. If you have always used the same search firm, try a different one. If you have always used your network to find people like you, consciously expand the range of connections you make, and the backgrounds and skills they represent

A final thought is this. Boards – why not get ready and take control? If you don’t, it may be that your industry regulator will require more of you in the future, imposing rules you must respond to, yet haven’t shaped or influenced. It is always better to be one step ahead, than the alternative ... being one step behind.


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