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To change the way business defines and measures success, we need more courageous leaders to join the movement. We need to build a stronger and broader community of all stakeholders to accelerate the transition from finance to customer capitalism. We need six things:

1. Investors and CFOs to embrace Earned Growth Economics. Financial accounting—and the financial planning and analysis that goes with it—must include customer-centric accounting that reliably measures the health of the organization’s customer relationships (the most valuable asset in most organizations). Customer-related accounting must include, among other things, the number of active customers and the timing of their onboarding, increases and decreases in their purchases in each period, exits by segment and employment cohort, revenue per customer by employment cohort, volume of new customers, acquisition costs, distribution of new customers to earned customers (Recommendation, referral, word of mouth, etc.) – in other words, all the key elements required to estimate Customer Lifetime Value for each customer.

2. Customer review sites and ecommerce platforms to make reviews reliable. Customer review sites need to innovate to provide honest and relevant reviews, which are therefore more useful. As a frame of reference, Fakespot estimates that in 2020, 42 percent of Amazon reviews are fake. I anticipate that in many industries individual customer preferences will be so diverse that relevant reviews will only need to be curated and organized to highlight the most relevant reviewers for each customer.

3. Investors Disputing Self-Reported (Uncertified) Net Promoter Scores. Many companies report unverified customer feedback scores. Investors who want to understand the value of a company’s customer assets need to understand how these metrics are derived and demand consistent and reliable methods.

4. Boards become real customer representatives. Boards must take responsibility for ensuring that their organization’s policies and practices treat customers properly – a higher standard than simply not breaking the law. Boards should consider establishing a client committee to function in conjunction with existing nominating/governance, audit and compensation committees. This oversight becomes even more important as companies embrace the promise (and risk) of artificial intelligence (AI)-driven interactions with customers. Businesses need to go beyond ethical AI and regulatory requirements and raise the bar to the standard of the Golden Rule of customer love. For this committee to have any real accountability and enforcement power, it needs reliable NPS data. This data will be available to some companies from third parties such as Bains NPS Prism and to other companies from trusted internal processes. But for many companies, this will only happen if we have robust customer-based accounting that enables reporting metrics such as earned growth that measure customer love and are auditable, and therefore most grateful for public reporting and executive bonus promotions.

5. Boards to reward leaders who play the long game. Executives must be protected from the distractions of short-term speculators if they are to make decisions about how to engage with customers. Because companies with the highest NPS ratings generate the highest total shareholder return (TSR), long-term investor interests are best served when leadership teams are encouraged to love customers. Executive compensation plans should evolve to provide generous bonuses to executives who provide real value to long-term shareholders – that is, a TSR that exceeds the hurdle of average stock market returns. In addition to TSR, customer and employee results should become part of compensation plans.

6. Employees should be more selective and insist that employers help them lead the right life. Employees are already demanding purposeful work, especially as the workforce transitions to Millennials and Gen Z generations. The best employees – from call center agents in Phoenix, Arizona to user experience designers in Shanghai to food delivery people in Madrid – have a choice of where to work. The work community they choose will greatly affect their ability to live the right life, so they should make that choice wisely, which in part means using the right data.

I realize that the path I just outlined will require a lot of work. Perhaps your humility sets in and you wonder if this effort might be beyond your ability. My answer is that it’s worth the effort. Why? Striving to accelerate the transition from financial to customer capitalism will be the most rewarding path for you and your team and will help you succeed.

Contributed to Branding Strategy Insider by: Fred Reichheld. Reprinted with permission from Harvard Business Review Press. Adapted/excerpted from “Winning On Purpose: The Unbeatable Strategy of Loving Customers” by Fred Reichheld starring Darci Darnell and Maureen Burns. Copyright 2021 by Fred Reichheld and Bain & Company Inc. All rights reserved.

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