1. © Copyright IBM Corporation 2013. All rights reserved. 1
At a moment when it seems that companies are really starting to tap
into the deluge of data, the next big question becomes: Can we apply
this insight broadly across the organization and fundamentally change
how we do business?
According to a new IBM study, the more accurate question is not
if business will change, but when. The study, titled “The Customer-
activated Enterprise,” found that a growing number of CEOs are
already actively seeking out their customers to influence not only
business decisions but, remarkably, business strategies as well.
Based on face-to-face conversations with 4,183 C-suite leaders
across the globe – 312 from midmarket companies – the ambitious
effort examines how the C-suite views this new data-driven world
and the impact it will have on their businesses.
We spoke with Heidi Dethloff, Vice President of Global Midmarket
Marketing at IBM, about the study’s key findings and what it means
for the future of midmarket businesses. Read excerpts from the
interview below.
ForwardView:
The title of the study is “The Customer-activated Enterprise.”
What does “customer-activated” mean?
Heidi Dethloff:
This study uncovered three major business shifts. One was to open
up to customer influence. Two was to pioneer the digital physical
innovation. And three was to craft engaging customer experiences.
What’s driving these shifts is the customer. Many enterprises, I think,
are moving from customer-centric organizations, to now, customer-
activated ones. Customers are more empowered than ever thanks
to smart technology, greater access to information and new ways to
socially collaborate directly with organizations. Sixty-three percent
of our midmarket leaders from this study say customers have a major
influence on their business and how they do business with their
traditional customers. And 89 percent of midmarket leaders plan to
collaborate more extensively with their customers going forward.
ForwardView:
How does the C-suite leader view the world? How has that evolved
over the years?
Heidi Dethloff:
The report is IBM’s first study of the entire C-suite. And it is actually the
seventeenth in an ongoing series of our CXO studies that are developed
by the IBM Institute for Business Value. So we now have data from more
than 23,000 interviews, and that stretches back to 2003.
C-Suite Study: The Rising Influence of the Customer
“Every member of the C-suite wants
to become far more involved and engaged
in managing the customer experience.
And they are turning to technology and
digital channels.”

2. © Copyright IBM Corporation 2013. All rights reserved. 2
Quite a bit has changed since then, as you can imagine. Back in 2004,
the top concerns were focused on cost reduction and competing in
this global economy. And then new business models started to evolve
in 2008, which basically enabled new partnerships, new collaboration.
Today, the customer is front and center, and a digitally activated
customer moves to the top of the agenda.
When IBM published its first C-suite study in 2004, CEOs ranked their
own customers sixth on the list of all market factors they believed
would drive the most change in the organization. Nine years later, 60
percent of CEOs expect customer influence to go beyond traditional
activities such as developing new products. Instead, they’re ready to
engage customers directly in shaping and developing their business
strategy.
ForwardView:
The study found that CEOs want customers to have a greater say in
how their company runs and in its business strategy. How does a
company go about doing that?
Heidi Dethloff:
Without a doubt, new and creative ways are needed to get customer
input on key decisions and create that deep foundation. And that
deep foundation needs to be built upon trust and collaboration.
Two-thirds of the organizations that outperform their peers are not
just managing customer experiences; instead they are now reorienting
their organizations, their strategies and their investments to cultivate
new relationships across all customer touch points – or all customer
interactions. And some of the most advanced enterprises are actually
establishing customer advisory boards to get that direct input on
strategic issues.
ForwardView:
Another key theme that you talked about is the intersection of the
digital and the physical worlds.
Heidi Dethloff:
I think we as consumers recognize the emergence of social, mobile
and digital networks. They are all playing a huge role in driving new
relationships between the consumer and retailer. Well, the same is true
in driving a new relationship between organizations – whether they’re
business-to-business organizations or business-to-consumer – and
with their customers.
It’s also forcing organizations to rethink how they work. There’s this
intersection between the digital and the physical worlds, which is really
the leading edge of innovation. For example, smart pills and smartphone
heart monitors; or intelligent vehicles and crowd-source traffic routing;
or books that respond to a reader’s location and the applications that
will actually enhance their physical in-store experience.
The possibilities are huge, and CXOs realize that it’s important to start
to bring those two digital and physical worlds together and drive new
innovation.
ForwardView:
Let’s tackle this idea of crafting engaging customer experiences.
This seems to represent a fundamental shift in how many C-suite
leaders, with the exception of the CMO, view their role in the business.
Heidi Dethloff:
Based upon the study itself, every member of the C-suite wants to
become far more involved and engaged in managing the customer
experience. And they are turning to technology and digital channels.
Midmarket leaders plan to actually increase the use of digital channels
by 45 percent so that they can engage with customers directly. And
when you think about some of the most advanced organizations,
they’ll actually go further. They’ll apply data and analytics to actually
understand customers as individuals, and then design a system of
engagement based upon individual customer needs. Eighty-five percent
of midmarket leaders hope to understand their customers much better
in the future.
ForwardView:
What do you think needs to fundamentally change in the organization

3. © Copyright IBM Corporation 2013. All rights reserved. 3
Learn more by going to:
ibm.com/forwardview
in order to become what IBM calls a “customer-activated enterprise”?
Heidi Dethloff:
It all starts with the willingness to open up – if you will – to your
customers, and then design an engagement model that drives internal
and external collaboration. It’s gathering and using customer insights,
feedback, viewpoints – and the viewpoints may come internally and
externally, may come directly from one customer or many customers
– but to take those viewpoints and actually help them provide input on
product innovation or perhaps give feedback on pricing policies.
It also requires that the company’s C-suite team work together with
common objectives and outcomes so that they can drive this new
customer-active enterprise to really become a reality for them. It’s this
idea of being willing to be open, being willing to trust your customers
and designing a system around that; but at the same time, internally,
working together as a collective team.