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Why putting the customer first could backfire

The benefits of a ‘customer-centric’ approach in retail are widely extolled as the key to getting ahead of digital competitors. Take the rental car industry. Start-ups like Uber, Lyft and ingogo have won huge gains with customers by allowing travellers to design their own transportation experience, deciding on payment, vehicle and driver. Rental car companies risk losing out if they fail to adopt practices that engage customers by offering a richer, customised and frictionless experience.

But there is a catch. As organisations increasingly focus on the customer, they fail to consider the ‘unintended consequences’ of harnessing digital technologies to enhance our everyday engagement with products and services. While security and privacy concerns are often discussed, there is a growing mountain of evidence around other unintended social consequences.

The arrival of Uber in Australia caused massive disruption, upsetting taxi unions due to unfair competition and State governments over the issue of GST. In the United States, the Federal Trade Commission are investigating the short-term property industry in light of Airbnb’s alleged negative impact on affordable housing.

These incidents highlight the risks associated with the unintended consequences of digital advances and consumer-centricity. In response, organisations should expect to see a sharp rise in digital ethics and an upscaling of the debate on conscious capitalism in Australia and beyond.

This year, there will be more initiatives like those coming from the Leverhulme Centre for the Future of Intelligence. The research centre was launched by Cambridge University to explore the opportunities and challenges posed to humanity by the development of AI.

Meanwhile, new structures to help manage the ‘unintended consequences’ of digital technologies will be put in place. In Australia, this is already underway as Prime Minister Malcolm Turnbull re-launched the federal government’s new national cyber security strategy last year and extended funding for the scheme.

Today, the spotlight is focused on organisations not thinking hard enough about the implications of the business decisions they make. In this climate, online retail brands will be forced to focus more closely on their social experiences, in addition to customer and employee experiences, to protect themselves against unintended consequences of their activities.

To guard against the unintended consequences of their actions, organisations can take the following steps to address the bigger picture:

  • Get social: Organisations should take a three-tiered approach to address customer, employee and now, social experience. They must question what impact their actions will have on society or the environment, where there will be hidden costs, and where they are most likely to be exposed.
  • Keep people close: Organisations must work to preserve and promote the dignity of work and ensure that living, breathing humans sit at the heart of their digital services. Embracing social experience means accepting a moral obligation to reach and include the excluded.
  • Prioritise diversity: An automated digital service is the product of its designers and coders. As such, ensuring the diversity of teams creating these new products and services will be essential. The more perspectives introduced into that development process, the better, and more inclusive that automation will be – and the more unintended consequences you can avoid.
  • Learning and evolution: It seems obvious, but continuous learning and development is critical to stay relevant in a world that is constantly changing. The best employers will look for employees hungry to learn and the best employees look for routes to continual learning and skills development. Institutions that focus on their social experience, as well as customer experience and employee experience, will effectively guard against the unintended consequences of their activities.

Glenn Heppell is Accenture’s managing director for products in Australia and New Zealand.

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