One of the of the most important aspects of Steve Jobs isn't his marketing or presentation skills, it is that he performs the role of virtual customer in Apple and assures the acceptance of most products personally. This connection between the customer and products is rare, but it's showcased in Apple's amazing power and popularity since Jobs' return. EMC and Microsoft are developing different approaches that potentially will create a more sustainable virtual customer.
With Microsoft, it is the rise of CIO Tony Scott within the company, who represents its virtual corporate customer. And under VP of Quality Jim Bampos, EMC is creating a unit that virtualizes the customer through metrics. EMC's approach is the more sustainable, but both should, over time, allow these companies to approach Apple-like customer loyalty. Let's explore this.
The Power of Steve Jobs
While we often focus on Steve Jobs' public roles and his capability to present products as highlighted in "The Presentation Secrets of Steve Jobs," a book I think every aspiring or existing CEO should read, we forget that he also plays the role of virtual customer. You can see the difference in market performance between products he "gets," like the iPod, and products he doesn't, like AppleTV (Steve isn't a fan of TV).
Most technology companies bring out products based on what engineers, who have little real contact with customers, want to do. And most CEOs let them do it. At Apple, Jobs takes a personal interest and assures products that are built can be easily pitched, sold and that he and his family would enjoy using them. He is a super focus group of one and, better than any focus group, he is hard to manipulate.
If you open up a new Apple product -- I was sitting next to a guy who does teardown analysis on Apple products on the plane back from LA yesterday -- you will see an engineering mess because form took priority over function. The product is initially prioritized to be attractive, sell and please buyers. As a result, it tends to be inefficient, expensive and somewhat unreliable. As the product matures, it is optimized internally and in the meantime, Apple's support structure, which has been designed for this, takes up the slack.
Few realize that when Dell had the highest customer-satisfaction scores in the '90s, it also had some of the least reliable products. People were happy with Dell because they had frequent contact with the company during repair cycles and Dell treated them exceptionally well. Sony's products were vastly better built, but its support structure was horrid and its scores and customer loyalty were far lower. Steve Jobs created a company that took the appearance from Sony and improved on the customer experience from Dell.
Tony Scott, Microsoft CIO and Virtual Customer
I met Tony Scott, who is is becoming Microsoft's virtual customer for enterprise offerings, for the first time earlier this week at TechEd. Similar to the way things are done at Apple for consumer products, Microsoft CIO Scott is involved deeply in both the creation of new offerings and addressing problems with old ones. While he, like most Microsoft executives, has a pool of Microsoft customers, he advocates for his real value as a super customer inside Microsoft.
One of the interesting stories he told was how grateful Pixar, a company owned by Steve Jobs, was when his former employer Disney acquired Pixar because it got better support. Pixar remained an Apple shop, but without Disney, Apple largely ignored it and treated Pixar poorly. Disney, because of its size, got better treatment and so did Pixar. I found it interesting that Pixar needed Disney to get adequate support. Just as Microsoft struggles with the consumer market, Apple struggles with IT because Steve Jobs isn't a good proxy for a CIO.
This is partially what makes Scott particularly interesting is that he focuses on an an area that Apple largely ignores. Now if Microsoft could create another Tony Scott for consumer products, I think you'd see a very powerful result.
Scott is the guy that makes sure corporate products are done right, customers' needs are adequately addressed in product and services, and problems are properly prioritized. He is part of the reason that Azure is coming to market with massive support and is Microsoft's iPad for the corporate market.
EMC's Jim Bampos
The problem with making an individual the virtual customer is the practice is tied to that person. Steve Jobs and Tony Scott are doing a powerful, but unique service for their companies. But these are unusual roles for CEOs and CIOs that might not survive their departure. Even now, Jobs is a poor proxy for a CIO and Scott a poor proxy for consumers. But what if you could use metrics instead?
That is what Jim Bampos is doing at EMC. I've called its quality process the best I've ever seen largely because it focuses on customer loyalty and advocacy. Chairman and CEO Joe Tucci seemed to grasp that there was a potential to create process that would emulate what Steve Jobs does for Apple. So VP of Quality Jim Bampos has created what amounts to a customer loyalty and advocacy lab at EMC.
It's advancing the art of measuring and reporting satisfaction and loyalty down to a product and services level, and its metrics form the core of how resources at EMC are allocated. In effect, EMC is building a process that, if successful, will do what Jobs does intuitively. It does this continually and is working to make this capability immortal in EMC.
Already, EMC has confirmed that improving things like licensing and simplifying customer interaction are more valuable, dollar for dollar, than improving physical products in terms of customer loyalty and advocacy. The results of this work have been market share and profitability gains that are not only measurable, but tied back to it.
The company is still early in this process that eventually could become a template that could be applied to everything from a toaster to a mainframe.
Most companies use the "crap against the wall" method of product development. They build stuff and hope marketing and sales can find folks who will buy it. Apple, meanwhile, selectively designs products to target customers. In the enterprise world, Microsoft is learning that having a Steve Jobs-like role in its CIO is resulting in a vastly better hit ratio and excitement rivaling Apple's in the consumer market. However, EMC while moving more slowly, is creating a process that could continue indefinitely and assure that company's success into the next century. There are huge lessons to be learned here. I wonder how long it will take for others to learn them.