Become a Customer-experience Business
Success comes from recognizing that every business is now in a customer-experience business. Companies that are not customer-driven standout remarkably as a sore thumb in today’s marketplace. So, how can a company perform distinctively in the market with a unique customer-experience? They must take proactive steps to build internal momentum with initiatives that are supported by necessary customer-experience conviction and a shared aspiration across their organization. It must not only inspire, be aligned and provide direction, but it must be innovative, energizing, co-created and supported by a clear strategy. When done right, it can deliver dramatic results in the form of more loyal customers, fulfilled and engaged employees and better economics.
Customers have many ways to engage in today’s omnichannel world, through websites and social media, in a store, and on a device while on the go. The key challenge today for companies involves managing the increasingly complex, omnichannel customer pathways that define the overall experience with a brand, and then to create positive brand advocacy as a result of that experience. Customers spread the word about their experiences—whether positive or negative—far and wide among people they know. Those opinions matter a great deal. Direct word-of-mouth recommendations from friends and family are by far the most important source of information for customers thinking about buying a product or service: such brand advocacy is about four to five times more influential than the more indirect recommendations associated with newspapers, magazines, television, and social media, for instance. These results are consistent across countries and industries.
Put customer at the center of everything
Few organizations have the necessary organizational culture to deliver truly customer-centric customer experiences. Often, a well-intentioned strategy is diluted by operational constraints (whether real or perceived) and a loss of focus, resulting in little more than lip-service being paid to the concept of customer-centricity. Customer expectations and behaviors have changed dramatically over the past decade. Organizations are expected to meet customers’ needs and expectations at every interaction, in return for customer loyalty. The ability to deliver this depends on the extent to which ‘customer-centricity’ is embedded within every single person in your business.
Driven by several challenges like, rapidly shifting consumer trends, digital engagement, consolidation, cost pressures, regulatory pressures, etc., customer-centricity can help grow revenue, improve efficiency, and drive performance, while enhancing customer-experience that enables loyalty and advocacy. Today, becoming customer-centric has become a core business requirement.
Leadership commitment to customer-focus must be palpable
Senior management must use their leadership to drive the customer focus within their teams by embedding customer in the heart of the operations. Building customer-centricity requires empowerment of top executives to own customer journey, from initial contact through to final resolution and advocacy. The customer-experience vision and KPIs must be derived from strategic priorities. They put in place a transformational spine of change agents that model behaviors to inspire the organization. Leaders must put-together high-level governance that direct cross-functional and agile organizational structures that drive positive customer experiences. A compelling vision defines specific proof points for meeting customers’ needs and priorities, and how the company will achieve those goals. It also determines how those proof points will translate into operational metrics to help consistent delivery across all channels.
Customer shift in the way they interact with organization have moved to digital channels. So customer leaders must have a voice and presence on these digital channels. They must communicate and engage via short and direct messages through these digital channels with customers and employees to keep up-to-date with issues and concerns that need immediate resolution. Senior executives must still continue with informal channels of communication in their organizations to relay real stories of employees delivering exceptional customer service, to motivate and inspire employees. The idea is to draw out opportunities to create a better and consistent outcome for the customer by having a clear view of customer feedback and complaints insights.
Arrive at reliable internal and external customer insight
Deep insight into the varying needs of different customer segments can be gained from customer profiles that companies gather. Customers’ needs and wants are shifting drastically, and the ways they communicate with organizations are changing frequently as well. To tailor customer-experience to what you know about them, it is important to understand who your customers are, what their likely behaviors are and what their expectations are. Ensure that the customer segmentation is well aligned with the customer-experience design, so that it is done towards the targeted segment. You must have clarity of barriers and bottlenecks across every customer touch-point on a well mapped customer experience journey. Customer usage and deployment must be mapped on a 360 degree view of the customer and, a test & learn approach to capturing optimum insights must be incorporated.
Put together customer insight teams and capture voice of the customer (VOC) from all areas of the organization to better understand the customer. External information from a customer’s background can provide valid insight into their spending profile and habits. Combining behavior and usage data with external customer information can provide better view based on customers based on their behavior and usage. Analysis of all this information can often lead to breakthroughs in the services and products you choose to offer customers and how you choose to interact with them. The ability to identify variances in customer profiles unlocks a wealth of information with which to target them. Understanding the different socio-economic groups, location of origin, address and household details can help organizations approach customer service in a way that is much more useful to the customer.
Companies can improve the integration of their customer insight functions into the business and thereby improve innovation. By strengthening this relationship, consumer-facing companies can integrate customer insights into their business operations and ensure that the valuable trail of customers’ digital activities and behaviors doesn’t grow cold. Failure to rapidly translate this data into business strategy will leave an opening to smaller digitally native entrants to do so. And that will make maintaining share and finding growth impossible for incumbents.
Design the right customer-experience
To design the right customer experience, it is crucial to understand what the customer’s journey looks like across the product lifecycle. This alternative view of your business processes allows you to empower your people who are serving customers at each of the key touch points along the journey. Companies need to embed customer journeys into their operating models in four ways: they must identify the journeys in which they need to excel, understand how they are currently performing in each, build cross-functional processes to redesign and support those journeys, and institute cultural change and continuous improvement to sustain the initiatives at scale.
Once a company has identified its priority journeys and gained an understanding of the problems within them, leaders must avoid the temptation to helicopter in and dictate remedies; indeed, they should refrain from any solutions (including ones from outside experts) that don’t give employees a big hand in shaping the outcome. Even if a fix appears obvious from the outside, the root causes of poor customer experience always stem from the inside, often from cross-functional disconnects. Only by getting cross-functional teams together to see problems for themselves and design solutions as a group can companies hope to make fixes that stick.
Organizationally, adopting a journey-centric approach allows companies to move from siloed functions and top-down innovation to cross-functional processes and empowered, bottom-up innovation. Most companies keep their functional alignments intact and add cross-functional working teams and processes to drive change. Journey-based transformations are not easy, and they may take years to perfect. But the reward is higher customer and employee satisfaction, increased revenue, and lower costs. Delivering successful journeys brings about an operational and cultural shift that engages the organization across functions and from top to bottom, generating excitement, innovation, and a focus on continuous improvement.
Empower the frontline
Companies, that take the customer-centric approach, constantly translate strategy and organizational decisions into frontline routines and behaviors in order to serve customers better and earn customer advocacy and loyalty. The leaders obsess about the key players in their organization who deliver the value to customers and ensure that these people are the “heroes.” Leaders do not allow organizational layers or complexity to distract them from this focus on the talent that really matters. Frontline empowerment is a top priority—these companies give their people the authority and resources they need to do what it takes to serve customers better. This leads to relentless experimentation—hundreds of experiments by customer-focused, empowered employees continually innovating and working with their customers to devise new solutions, better service and better products.
To empower the frontline, the brand and its implications need to be understood. Providing empowerment to the frontline works best when people believe they are an important part of the organization. Senior management need to regularly show their appreciation of the role people play on the frontline and acknowledge the feedback they provide as well as leading by example. It is the frontline staff who understand better than most the impact that specific changes will have on both their roles and on the customer. Ensuring that your frontline team understands how you want to treat customers and the style of relationship you want your customers to experience will impact how they behave, the sorts of decisions they make and ultimately will form the view that the customer has of the organization.
Organizations that excel at frontline execution know how to motivate employees, even in positions that involve seemingly uninspiring tasks. They manage to foster a connection between the frontline employee and his or her job. It could be that the employee belongs to the company's target market segment and thus understands the kind of extra help that will benefit the customer. The result is a virtuous circle. Organizations benefit from the energy unleashed by this connection, while employees feel more motivated and fulfilled. In addition to hiring the right people, frontline leaders also ensure those people are focused on the measures that matter and are paid in a way that reinforces desired behaviors. Also outstanding frontline performance cannot be provided without the right tools and techniques. Great companies foster a passion for the business that encourages the right culture among people to give their best.
Building a high-performance front line requires companies to do five things well: set a compelling vision; define clear roles; hire the right people; provide strong tools; and build a high-performance culture. Giving power to frontline staff is essential; they need to have the ‘right’ tools and information to help them meet customer needs. There needs to be clear decision making channels to enable frontline staff to make ‘on-the-fly decisions’ that help resolve queries at first point of contact. One of the single, biggest things that organizations can do to empower the frontline is provide a single customer view (SCV) of all customer interactions, relationships and external activity. It is critical not to underestimate the change process necessary. While it may be possible to analytically determine the right frontline structure or the appropriate balance between productivity and service in employee metrics, it is impossible to realize these goals without winning thousands of individual hearts and minds. Companies that succeed in building a strong front line gain an enduring source of competitive advantage. When frontline people give time and energy to making the business succeed, competitors have a hard time keeping up.
Engage the back-office functions
To complement the efforts to build innovative customer experiences, companies should consider ways to digitize back-office functions and optimize company performance. Customer-centricity is about every team and individual in the organization, not just customer service. The design and delivery of the customer experience should be the key strand that brings an organization together and closer to customer-centricity. Unfortunately, we often find that the majority of people outside customer-facing business units fail to understand the customer lifecycle and touchpoints from the customer’s perspective. Companies use the customer lifecycle and the mapping of the key customer touch-points as the framework to educate and help drive customer-centric thinking and behaviors within back office functions.
Organizations must take a more robust view of these non customer-facing business functions and provide them with the education, tools and awareness needed to inform individuals of what it means to be a customer or customer facing. They must overcome challenges by encouraging/mandating other areas of the business and senior executives to spend time on the frontline to get a real perspective of the customer experience. Often this leads to a new appreciation of the impact of decisions made in key functions, such as Marketing, IT and HR.
Identify metrics that really matter
Executives looking to boost their companies’ competitiveness via superior customer experience have for some time now invested heavily in a farrago of metrics that at times seem to range from the sublime to the ridiculous: metrics that score satisfaction, metrics to gauge willingness to promote a service or detract from it, metrics to judge how effortlessly a company serves its customers, and even metrics to assess how “ideal” a customer’s experience is.
The heart of effective customer-experience measurement is the organizing principle of measuring experience at the journey level, as opposed to looking only at transactional touchpoints or overall satisfaction. It’s critical to invest in hardwired technology that can capture customer feedback on a daily basis from multiple channels and integrate survey results, social-media posts, and operational data into comprehensive, role-specific dashboards. These can provide transparency and drive decisions at all levels. Finally, overcoming organizational inertia requires cultivation of a continuous-improvement mind-set at all levels. Organizations must create the mechanisms to close the loop between frontline workers and customer feedback, then use the data to change the design and execution of the customer-experience process.
Even companies that are new to customer experience can implement a rudimentary voice-of-the-customer system with which they can collect feedback from their customers on a monthly or quarterly cadence. However, if you are serious about creating a culture around customer experience, don’t waste your money on a system lacking the right capabilities. Table stakes in this game are a system that collects, analyzes, and allows companies to act on customer feedback in real time. Furthermore, your system must be able to apply advanced analytics to the data in order to diagnose root causes and predict impact on future customer behaviors. The first step is to define an integrated measurement model that identifies the metrics that drive top-line satisfaction. The second step is to design the interactive dashboards for each set of stakeholders: executives, customer-experience leaders, and frontline managers. The third step is to select the platform that will best meet the specific needs of the company.
The right customer-experience metrics help you understand what customers value and how to address their needs. The metrics you choose are less important than the measurement strategy you implement to enable both real-time action and long-term impact.
Continuous improvement driven by feedback and lean principles
Many service functions lack the ability to analyze and manage the factors that affect the workforce productivity, such as exceptions and rework. More over, inconsistency is a problem for many service processes. Because many service processes cross functions and departments, few people have a complete picture of the end-to-end workflows, and inter-dependencies, and interfaces are often hidden. Before these service processes can be improved, its steps must be wholly transparent. Look for hand-offs and steps that waste time and add no value, and analyze information flows to identify silos and roadblocks. Complexity is a major obstacle to process efficiency. Flag and eliminate any variations, disruptions, reworks or exceptions that slow the workflow. Rethink and redesign to eliminate the elements that sap efficiency.
Done right, lean principles can become part of the company culture, as people continue to think of ways to improve what they do. Implementing lean customer services is really an exercise in change management – and one that is most effective when people at the frontlines are involved and engaged in problem solving. For instance, customer service workers are the best source of customer insight and suggestions for process improvements, so it is important to involve them any lean initiative. Employees are less likely to resist new ways of working if they’ve had a hand in redesign and understand how they’ll add value.
New social channels allow customers to feedback in real-time; operational changes can, and should be, made in hours, not days, weeks or months. To create effective feedback loops, all feedback must be consolidated against the customer lifecycle and key touch-points. This is often best done centrally and driven out of a voice of customer (VoC) team that is taking a customer view, rather than thinking about specific product or channel silos. Companies are approaching the digital age in very different ways. Some have dedicated teams monitoring and responding to individual feedback, while others are choosing to monitor but not take direct action. Many organizations use data mining tools and search capabilities to hunt out comments and feedback made by individuals about their company. Social media provides organizations with real-time insight.
Often, compelling feedback never makes it to the right place to be considered, as it gets passed to the wrong person or it is not clear who is responsible for it. Two practical ways to avoid this are firstly ensuring all feedback is passed through a central team for distribution and secondly, the use of a ‘dashboard’ that can be accessed by anyone within the organization to submit, track and monitor feedback and ideas submitted. Traditional and digital feedback loops must cut across the entire business (both customer-facing and non customer-facing business units), or joined-up to allow consolidated analysis and prompt action.
Customer-experience transformation driven by effective customer-centric change
Companies typically have their core product, service, and brand marketing well under control, since these areas lie close to traditional core capabilities. The key challenge today involves managing the increasingly complex, omnichannel customer pathways that define the overall experience with a brand, and then to create positive brand advocacy as a result of that experience. But for companies looking to make the customer experience a strategic priority, adopting a customer-centric mind-set can be a struggle. Like many change programs, customer-experience transformations often fail to meet expectations. That’s not surprising: they require employees to change their mind-sets and behaviors, and an organization to make cultural changes and rewire itself across functions, with the customer’s needs and wants—rather than traditional organizational boundaries—in mind.
Companies must spend significant time up front to define a clear, compelling, personal, and ambitious aspiration, which doesn’t necessarily involve becoming a customer-experience leader. Depending on the context, it may make sense for a company to aim at having a best-in-class customer experience or to improve the baseline but not invest in a full transformation. Some organizations have an even more detailed focus: on specific kinds of customers whose experience they wish to improve in order to set aspirations and change operations, mind-sets, and behavior.
At the executive level, identify if the vision and strategy articulate clearly how the organization will treat its customers and assess how focused the executive is in effectively managing the customer experience. At the process design and leadership level, assess the journeys experienced by customers when doing business with your organization to gauge, amongst other things, ease of interaction. At the operational leadership level, assess the views of leaders and managers on customer management and measure this for alignment against the organization’s vision and strategy, making recommendations for change. On the frontline service delivery level, use data analytics to understand the day-to-day customer interaction and the impact of these activities on the customer experience.
For customer-experience transformation to succeed it must be among the top-three priority for the CEO or the top team. Without their support, securing cross-functional alignment is difficult, and transformations lose momentum when internal resistance or apathy materializes. Many organizations launch programs to transform the customer experience with no sense of what a better one will be worth and therefore no way to judge potential initiatives. Leaders of such a transformation will find it hard to secure sufficient resources for needed investments if they don’t have evidence that their efforts will generate business value. Building the link to value is possible, before any action has been taken, by using customer research and operational data to link satisfaction with the customer experience to outcomes of financial interest, such as loyalty, customer churn, and revenue. Once a link to value is established, a leadership team needs to understand where it is worthwhile to expend effort—what actually matters to customers and can drive value. Building a business case for improving the customer experience is a challenge.
Successful transformations therefore tend to start with a rigorous attempt to identify those things that matter most to customers. Such efforts establish a clear understanding of where improvements in the customer experience can create value across the organization—financial returns, operational efficiencies, and improved employee engagement and outcomes. Sometimes, customer-experience transformations collapse even when executives have correctly determined what matters to customers, defined a good target, articulated a clear link to value, and provided strong support. In these cases, the culprit is often a loss of momentum from a project’s failure to have an impact in the short term. The belief that top-down management, supported by measurement alone, will improve the customer experience is a common mistake of these transformations. Great organizations apply the tools of human-centered design to create distinctive customer experiences and separate themselves from the pack. Companies can apply these tools equally across product, service, and digital experiences. From call-center scripts to the replacement of printer ink, great customer experiences build loyalty, which drives growth and generates competitive advantages.
The evolution towards becoming a truly customer-centric organization is both complex and long, and rightly so. It is the holy grail of unlocking the true potential of customer value. Yet organizations should not be discouraged. There are a number of initiatives that can be driven from Customer Service Leaders to change the composition of the organizational structure at all levels. Furthermore, even small changes can have significant benefits for both employees and customers. Incremental changes in policy and processes to demonstrate a shift in thinking and behavior can help to drive transformational change agendas. However, Customer Service Leaders need to be smart about how to approach customer-centric change to ensure the greatest return on investment. Often the return is not easily quantified and leaders must have the courage to stand up for the customer and drive through compelling initiatives that may not return in-year benefits but which will deliver an efficient platform for achieving long term customer value.