How to Organize the Insight Function

Centralizing the capabilities devoted to customer insight can produce efficiency but also carries four important risks that must be addressed.

They may seem like curses of modern corporations, but org charts and regular reorganizations are now a fact of business life. I'm sure, as an insight leader, you will have seen your fair share. As you've risen up the hierarchy, you've probably changed your role, from recipient to author. From my experience, two major opportunities exist for organizing customer insight functions. The first is to bring together the different technical areas that can best collaborate to provide deeper insights that lead to more action. These include teams that are often located in different functional silos. In line with my definition of customer insight, I would recommend bringing together: customer data, analysis and modelling, research and database marketing teams. Suitably integrated and with a culture focused on outcomes, these teams can work together for an "insight engine" that produces not just technical output but actions that result in both commercial impact and improved customer experiences. The second opportunity tends to come later in the maturity of a customer insight function. It is the centralization challenge. Whereas I would not encourage accelerating this (my experience is that insight teams drive more value when close to the business area they serve, with shared targets and emotional engagement), there do come times when it is appropriate. This will often be driven by wider corporate changes in line with simplification and cost reduction. But centralization can also be an opportunity. Integrating into one center of excellence on customer insight that drives consistent processes and coordination of customer interactions across lines of business can also drive value. Here are some of the benefits and risks I've seen in these centralized models: Benefits of a center of excellence:
  • Economies of scale in specialist technical work;
  • Career paths for more technical practitioners;
  • More independent overview from business partners;
  • Optimization and coordination of customer interactions.
Risks of a center of excellence:
  • Loss of knowledge about specific business areas (becoming an "ivory tower");
  • Loss of a sense of belonging to a business area (engagement);
  • Inflexibility about different local needs (one best way);
  • Apparent bureaucracy -- some things take longer (common process).
Interestingly, a poll we ran on customer insight found that all the leaders answering were running or part of a center of excellence. It would be interesting to hear from any customer insight leaders who are still successfully running a more federated or localized insight model. What is your experience?

Paul Laughlin

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Paul Laughlin

Paul Laughlin is the founder of Laughlin Consultancy, which helps companies generate sustainable value from their customer insight. This includes growing their bottom line, improving customer retention and demonstrating to regulators that they treat customers fairly.


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