A Behavioral Foundation of Customer Orientation



Citation:

Volker Trommsdorff (1998) ,"A Behavioral Foundation of Customer Orientation", in E - European Advances in Consumer Research Volume 3, eds. Basil G. Englis and Anna Olofsson, Provo, UT : Association for Consumer Research, Pages: 273-277.

European Advances in Consumer Research Volume 3, 1998      Pages 273-277

A BEHAVIORAL FOUNDATION OF CUSTOMER ORIENTATION

Volker Trommsdorff, Technische UniversitSt Berlin, Germany

[This paper is based on a thesis written by the graduate, Mr. G. Rose, who, at my suggestion, investigated the psychological literature for a theoretical basis to the management construct "customer orientation".]

1. INTRODUCTION

Who among us has not been annoyed by a lack of customer orientation! What kind of company would not want to move close to its customers, improve its service, increase customer satisfaction? Ever since Peters/Waterman (1982) popularized "closeness to the customer" as a recipe for success ("a seemingly unjustifiable overcommitment to some form of quality, reliability, or service"), customer orientation has become a prime subject within management.

Research in business management confirms the relevance of customer orientation as the key to a company’s success (e.g. Fritz 1994, p. 1047 f.). Customer orientation creates a sustained edge over the competition. The literature until now has considered customer orientation from a management viewpoint, recently using in particular the term "customer bonding" (in this respect cf. the overview and integrated concept by Diller (1996). But there is still no behavioral explanation of customer orientation as a prerequisite for its precise control. We concern ourselves with "taking the role of the customer" and wish to gain a better understanding of this process, so as to create a scientific basis for measuring and controlling customer orientation.

The focus of this paper is on anlyzing behavioral, theoretical approaches with regard to their efficacy in explaining and describing customer orientation. To this extent, we will begin by examining the obvious, well-known constructs from the field of consumer research. However, We will go on to present a social-psychological approach B hitherto ignored in marketing B which is concerned with the social-cognitive process of perspective taking (PT). The suitability of this construct for customer orientation is examined and relevant methods for measuring and influencing are discussed.

2. THE CURRENT STATUS OF RESEARCH IN CUSTOMER ORIENTATION

2.1 Economic-technical approaches

As early as the 1950s there rised a demand for customer orientation in the field of marketing (Knhn 1991, p. 97). In the meantime, various management concepts have seized on the idea. Thus, such apparently technical concepts as "Quality Function Deployment" (QFD) are really customer orientation programs designed to influence human behavior by, in this case, translating the language of the customer (customer demands) into that of the engineer (product design) (Kamiske et al. 1994). At the end of the day, "Total Quality Management" (TQM) is also aimed at customer orientation, by way of an integral customer-subjective understanding of quality (Stauss 1994; Walther 1995). "Business Reengineering" (Hammer/Champy 1993) is a radical reshaping of business processes so as to better suit the needs of the customer.

The common aim of these efforts is customer satisfaction, as satisfied customers remain faithful to the company (Hansen/Jeschke 1992), and are its capital. Customer satisfaction leads to customer bonding (and so to repurchasing, cross buying and word-of-mouth recommendations) and erects barriers for competitors wishing to enter the market (Mnller/ Riesenbeck 1991; Peter/Schneider 1994). Since winning over new customers is far more expensive than cultivating existing ones, customer satisfaction and customer bonding also have an immediate financial effect (Anderson et al. 1994).

Closeness to the customer has also been confirmed as a key factor in a company’s success, e.g. by a meta analysis of 40 international studies on empirical research into success factors (Fritz 1994). Backhaus (1995) shows that customer-oriented capital goods companies have an average growth in turnover of 10% (non-customer-oriented 6%) and returns of 7% (5%). An analysis by A.T. Kearney revealed that customer-oriented companies can demand up to 9% higher prices, and gain a market share of up to 6% more (Schnitzler 1995a, p. 62).

Despite the central importance of customer satisfaction, less than one quarter of the companies are convinced that their customers are satisfied. 40% of the workforce are unaware of the importance of satisfied customers to their job, and only 4% of employees and 24% of management claimed to know their customers well (Schnitzler 1995b, p. 72 ff.).

Marketing science has only been of limited help until now, as there has been no established valid scale of individual customer orientation (Knhn 1991; Homburg 1995). With regard to customer orientation, none of the many studies on the success factor of customer orientation contains specific scales, let alone a theory to explain customer-oriented behavior. Only recently have two studies appeared which systematically treat closeness to the customer, and discuss as well as empirically examine dimensions and indicators. These are briefly described below.

2.2 The "closeness to the customer strategy" B the Eggert approach

Assuming a diversity of definitions and applications as well as a lack of a measurement tools of "closeness to the customer", Egger believes there is a need for a redefinition and the development of an integral approach. She bases this on two empirical studies carried out in a large company and in SMEs. The author defines closeness to the customer from the supplier’s viewpoint by way of three dimensions: differentiation, readiness to react and flexibility B which are carefully operationalized (Eggert 1993, p. 36 ff., p. 127 ff.).

Differentiation is the supplementing of product performance by additional services in order to cover heterogeneous customer requirements. "External differentiation" is seen as the number of market sectors served e. g., the breadth and depth of the products on offer, additional efforts such as customer service. "Internal differentiation" is seen in the light of the organization according to types of customers and the expertise of the relevant managers.

Readiness to react describes the company’s ability to continually adapt its supply to customer demands as these change over the long term. It is seen in the existence of a complaints and/or customer service department, in the systematic exchange of customer information between departments, in the integration of customers in product development as well as in systematic market research.

Flexibility is the company’s capability of adapting to short-term changes. "Internal flexibility" is seen in the existence of a complaints department, in the rapid change in supply to meet customer demands and in the flexible implementation of available staff according to the requirements set by sales figures. "External flexibility" is made up of the abilities of the sales representatives and in considering customers’ special wishes.

This three-dimensional construct is supplemented by internal coordination and by coordinating with customers (Eggert 1993, p. 26 ff.). Factors here are agreeing structures, processes and measures. It is clear that Egger¦s scale works on the company, not the individual level.

2.3 "Closeness to the customer " B the Homburg approach

Homburg (1995) confines himself to the marketing of items of capital expenditure and, opposed to Eggert, analyses closeness to the customer from the customer viewpoint. To this end, the company structure, systems and culture are regarded as significant for success. As the first step, Homburg describes four dimensions of closeness to the customer based on 30 interviews with managers of European firms.

The dimensions are:

(1) quality and flexibility (products, services and logistics),

(2) attitude to interaction (involving customers in product development, lucid supply of information, dealing with customer suggestions, own suggestions to customers),

(3) commitment to a relationship (developing a strong relationship, willingness to acquiesce at short notice, trust in the strength of the relationship) and

(4) atmosphere (affective customer statements, customers’ trust in the business relationship).

Homburg¦s scale is valuable for customer orientation management on the aggregate company level as well, not going down to the individual empoyee¦s level.

2.4 Evaluation of the research in customer orientation until now

Customer orientation is an attitude expressed by the customer-oriented actions and behavior of both the employee and the company as a whole. After all, it is always caused by humans. The current aproaches ignore the behavioral rudiments of customer orientation. To our knowledge, there has been no theoretical investigation as to how employees succeed in "thinking like the customer" or "seeing with the eyes of the customer", as no such behavioral theory is known to customer orientation researchers. There now follows a new approach to the behavioral description and analysis of these processes.

3. BEHAVIORAL FUNDAMENTALS

3.1 Customer orientation and consumer behavior

Research into consumer behavior (Kroeber-Riel & Weinberg 1992, Forschungsgruppe Konsum und Verhalten 1994) is concerned with describing and explaining the behavior of potential customers. It makes use of findings and methods from psychology and social psychology. It is worthwile to check wether consumer behavior research and theory could support insights into customer orientation in the sense of placing oneself in the thoughts, feelings and behavior of the potential customer. Therefore we examined the impact of the central constructs in the theory of consumer behavior for customer orientation. We follow the system of constructs which differentiates state and process constructs (Trommsdorff 1993).

Arousal/Involvement is the most basic situation construct. Of particular relevance to customer orientation is involvement, as arousal to acquire and process information. Particular knowledge of the product and situation involvement is fundamentally important to customer orientation.

Emotion determines behavior to an extent which is often underestimated. Although far from easy to attain, a knowledge of the potential customer’s feelings is of great importance to customer orientation. Research into (dis)satisfaction B related to emotion B is of large significance.

Cognition, defined as subjective knowledge, is often the focus of attention in Consumer Behavior research. Customer-oriented communication should correspond to the potential customer’s cognition. Of importance here are coding, evaluation, specificity, safety and awareness of the customer’s cognition.

Also of great fundamental importance to customer orientation are motives in that they are a targeted, emotional and cognitively controlled impetus to the potential customer’s behavior. Needs trigger motives, such that motive analysis serves to determine the needs of the customer. However, this is often limited by the salesperson’s abilities, one reason why motive analysis is a central topic in sales training.

Attitudes play a leading role in consumer research. Their relative stability is of interest to customer orientation. Attitudes may be used as the basis for fundamental strategies aiming at closeness to the customer. Knowledge about the customer’s attitudes allows a better estimation of customers, their actions become definable. The attitude concept enables a customer-oriented definition of quality, which contradicts the engineer’s non-customer-oriented definition.

Values attract attention to membership of a social unit (culture, class, family). Standards within these groups regulate the opin-ions, attitudes, values and behavior of the individual members. Knowledge of the members’ standards and values according to the delimited market segments allows customer orientation on an aggregated level.

Personality/Lifestyle is the most complex state construct in consumer research. Of particular interest to customer orientation is research into lifestyles. Acting in a customer-oriented manner may be facilitated by orientation towards types of potential customers identified by research into typology.

An understanding of process constructs in the theory of consumr behavior also promotes customer orientation. The analysis of information acquisition allows customer orientation by perceiving information via summarizing ("chunking") or by evaluating image information. Much has been learned from information processing. For example, attention needs to be paid to the comprehensibility of text information depending on the type of customer. Non-rational yet empirically real thought schemata as well as the attribution patterns (attribution of causes) of the potential customers contribute to customer understanding. A knowledge of the typical processes used by the potential customer in evaluating products promotes customer orientation, too.

So what do the constructs presented here achieve in terms of customer orientation? Undoubtedly they contribute to a better understanding of the customer. They elucidate customer behavior and heighten awareness of its complexity and dependency on influential factors. They thus facilitate customer-oriented behavior. Due to their stability, attitudes, values and personality types, in particular, are constructs of significance to customer orientation.

Thus consumer research provides a theoretical basis for customer-oriented thinking. But the theories and constructs still do not explain the actual process of taking the role of the customer. Due to its autonomous realization of "the potential customer", consumer research has not developed any concepts to explicitly describe and explain the process "inside the employee’s head". There is the need for a construct which comprises the ability to adapt to the potential customer. The following, main section of this paper is such an approach based on psychological fundamentals.

3.2 The concept of perspective taking

3.2.1 Basics. The call for the need to view the market through the customer’s eyes or "to put yourself into the customer’s shoes" is found throughout the literature dealing with the practice of customer orientation. "Following ... the very depths of your customer’s brain" (Nagel/Rasner 1993, p. 25), "knowing the customer’s viewpoint" and "taking an objective look at the market from the end user perspective" (Geddes 1993, p. IX, 15). "Seeing the business in question through the customer’s eyes" (Schmidt 1992). "Define the customer’s needs from the customer’s point of view" (Kotler 1991, p. 18). "Walk in your customer’s shoes" (Whiteley 1991, p. 56). It would seem that this is all it takes to bring about customer orientation. That this is not true is seen in the difficulties encountered in its implementation. Customer orientation is based on a mental process which is obviously not self-evident and which works better with some people than with others. A relevant behavioral theory is needed to understand this process. Our search for this led us to an area of research in social psychology known as "role taking" (Flavell et al. 1975) or "perspective taking" (Hass 1984) B called in German "Perspektivenuebernahme" (Geulen 1982). Research in marketing has overlooked this concept until now.

Mead, 1934, cited by Geulen 1982 is regarded as the founder of "perspective taking". The concept is based on his interaction theory, which states that people want to anticipate the views of others, they harbor expectations about other people’s behavior and assume implicitly that others do likewise (Geulen 1982, p. 15). Perspective taking, described as "taking the role of the other" or "the cognitive tendency to put oneself in another person’s place" (Long et al. 1990), is regarded as a prerequisite for interpersonal understanding (e.g. Rosemann/Kerres 1986, p. 151), successful interaction (e.g. Feffer/Suchotliff 1966) and communication (Flavell et al. 1975, p. 261) as well as a necessary condition whenever social behavior takes place (Geulen 1982, p. 71, cf. section 3.2.2.).

According to Geulen (1982, p. 11), perspective taking may be described as follows: We are concerned here with being able to imagine, based on our knowledge of the position, of the relationship of another person to the matter in question, that person’s view of the matter, their perspective, and then conclude from this how they will probably behave. This in turn has consequences for planning our own behavior. For the time being, this may be described as role-taking or perspective-taking and what we will call #Perspektivenuebernahme’ here."

3.2.2 Perspective taking and social interaction. Although PT is yet to find a solid theoretical basis, there were attempts to combine PT with other constructs so as to form a theoretical concept. Geulen (1982) attempted to form a behavioral theory by developing the PT ability of putting oneself virtually in the position of the other, together with the superior construct of social competence.

Since, according to Geulen, behavior is mainly related to other people, the theory needs to be conceived form the outset as a social behavioral theory. Crucial here is the idea that humans do not only align themselves with the open behavior of others but also with their anticipated actions. The concept of "behavior orientation" differentiates between a level of general behavior orientation (behavior as a planned and actual realization of goals by way of certain measures in a given situation) and a level of orientation towards other subjects (others are regarded as behavioral subjects and thus different to other objects). Our behavior depends on the relationship between both types of behavior orientation. Thus it is important to know the behavior orientation of others.

This theory assumes that, in any common situation, humans put themselves virtually in the position of others and construct the specific perspective suited to the situation (Geulen 1982, p. 53). Both the prerequisites for interaction B namely communication and consensual definition of the situation B as well as the interaction itself presuppose recognition of the other’s behavior orientation. Thus perspective taking is an important precondition for social behavior.

3.2.3 Measurement: perspective taking and empathy. Perspective taking is connected with empathy. The two constructs overlap (Hogan 1969; Davis 1983). Borke equates empathy with affective perspective taking. Opinions differ with regard to the question "whether or not empathy involves actual vicarious experience of another’s emotions or simply the willingness and ability to put oneself in another’s place (role taking)" (Chlopan et al. 1985). The reason for this is due to the difficulty in separating the two concepts, documented in measurements with some small validity and reliability (Hogan 1969), but also due to the fact that valid indicators largely fail to correlate with one another (Chlopan et al. 1985). Thus we are forced to assume a multidimensional construct, composed of perceptive, affective, cognitive and communicative components (Goldstein/Michaels 1985, p. 9).

The methods for measuring perspective taking and empathy reveal the need for further research. Since they come from develop-mental psychology, these are nearly all scales for children. Measuring PT according to developmental phases is of limited importance to realizing customer orientation. Of interest to marketing is measuring the relevant abilities in adult employees and managers. The few PT studies carried out with adults measure self-defined empathy by way of questioning (Steins/ Wicklund 1993). Stimulus for further research is provided by the empathy scales proposed by Hogan (1969) and Mehrabian/Epstein (1972):

Empathy Scale (Hogan 1969)

+ I always try to consider the other fellow’s feelings before I do something + As a rule I have little difficulty in putting myself into othe people’s shoes

- What others think does not bother me

+ I like poetry (+)

Measure of Emotional Empathy (Mehrabian/Epstein 1972)

+ It makes me sad to see a lonely stranger in a group

- People make too much of the feelings and sensitivity to animals

- I often find public displays of affection annoying

+ I tend to get emotionally involved with a friend’s problem

Oppositely to the other approaches, these scales have proven validity and reliability (Chlopan et al. 1985). The two scales hardly correlate since they measure different aspects. While Mehrabian’s scale is based on an affective view of empathy and records this process, Hogan’s scale serves as a measure of the cognitive ability of the person "to put himself in another person’s shoes" (Chlopan et al. 1985; Steins/Wicklund 1993).

There are other empathy scales. Davis (1983) "Perspective Taking Scale" has items on "Fantasy", "Empathic Concern", "Personal Distress" and explicitly "Perspective Taking" ("to measure the tendency to adopt the point of view of other people in everyday life"). It is interesting to note that the PT scale clearly correlates more with Hogan’s scale (r=.40) than with that of Mehrabian/Epstein (r=.20). This leads us to conclude that perspective taking and the ability to empathize are two different processes, which need to be operationalized differently.

Steins and Wicklund (1993) define empathy as "experiencing other people’s emotions and other psychological states", and perspective taking as "perceiving the objectively perceivable background of a person". After several studies, the authors arrive at the conviction that perspective taking is a product of factors relevant to relationships. "Closeness" to the target individual has a positive effect on perspective taking, while a relationship laden with conflicts has a negative effect.

With regard to the use of "customer orientation", the two terms of perspective taking and empathy should be kept separate. PT scales come closest to "thinking like the customer". "Empathy" is a supporting characteristic. In any case, the current scales still need to be adjusted and validated for this application.

3.2.4 Influencing and training. In the end, customer orientation should not only be understood and measured but also controlled. The instrument of training is suitable here. Due to the yet undeveloped theoretical concept, it is small wonder that no unified approach exists. Training experiments are rarely found in PT research, simply related to children and individual skills (communication, recursive thought).

Research into empathy can also be useful for training perspective taking in adults. Goldstein and Michaels (1985) provide an overview of training approaches which partly relate to perspective taking. The authors consider it improbable that humans who have not acquired any normal empathetic skills during childhood will be able to develop this ability later on. Adult training should build on skills developed during childhood. However, this still provides certain stimuli for marketing-specific PT training.

Goldstein and Michael’s "didactic-experiential training approach" (1985, p. 197 ff.) appears very promising, comprising the teaching of the relevant basic knowledge and a mixture of behavior tests and games together with feedback discussions. The basic knowledge teaches fundamental human perception (Herkner 1991, p. 275 ff.) and draws attention to possible errors in so doing.

A relevant cognitive training for employees could include basic principles of expression psychology, nonverbal communication, Gestalt psychological, personality traits, implicit personality theories as well as social schemta. Attribution theory and halo effects, the "Person Positivity Bias" and the "Assumed Similarity Bias" could round off the cognitive part of the training (Feldman 1985, p. 60 ff.; Saks/Krupat 1988, p. 54 ff.).

Videos, films or audio cassettes could be used for behavior training, showing people implementing PT ("modeling"). Furthermore, it is recommended reenacting and practicing the skills presented by way of role playing, feedback discussions with trainers as well as "transfer training", which assists the trainees in utilizing the acquired skills in real work situations (Goldstein and Michaels 1985, p. 219, 225 ff.).

3.2.5 Consequences for research in customer orientation. This overview of the multifarious and at times contradictory field of research shows there is still no unified theory which could be adopted for research into customer orientation. Despite these as yet unresolved problems, research in PT still proffers interesting approaches for describing, measuring and explaining the mental processes underlying customer orientation.

"Thinking like the other person" has a theoretical basis in PT. Customer orientation is a special expression of perspective taking, namely the virtual taking the place of the customer, in order to (a) anticipate his perspective and the resultant actions (how does the potential customer regard his situation, what are his problems and desires?) and (b) to derive consequences for one’s own behavior (how should I as a company/employee react to these desires?).

A final explanation of this process is still not possible. But it has already been proved that perspective taking is a skill learnt in early childhood by way of social interaction. It may be permanently disturbed by inadequate development or a lack of motivation. Perspective taking as a multidimensional construct is an everyday process which is further developed in the social context, i.e. within the company, too.

3.2.6 Consequences for customer-oriented management. This results in approaches to the measurement and training of customer orientation. It offers considerable opportunities for evaluating and developing the customer orientation in (potential) employees.

Measurement: Davis’s PT scale and Hogan’s empathy scale point the way for a customer-orientation scale yet to be developed, which could be used in an assessment center or in marketing control. To this end, however, valid measurements for the differentiation, change and coordination of perspectives still need to be developed.

Training: the "didactic-experiential training approach" with role playing appears to be particularly suitable for teaching customer orientation. Its starting-points are (1) knowledge, especially of the "laws" of customer behavior, i.e. practical knowledge of the theory of consumer behavior and the customer situation, (2) skills, especially perspective taking, and (3) motivation, particularly empathy for the customer. All three components can be promoted by way of training. The development of training requires an investigation within the marketing context of how these skills may be improved within the company context.

As far as customer orientation within the whole company is concerned, the view of the individual employee is not enough. The customer-oriented employee is a necessary, but insufficient basis for customer-oriented organization. Individual or social-psychological theories can hardly be applied to the behavior of the whole organization. To achieve this, theoretical approaches as described in sections 2.2 and 2.3 are necessary.

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Authors

Volker Trommsdorff, Technische UniversitSt Berlin, Germany



Volume

E - European Advances in Consumer Research Volume 3 | 1998



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