As part of Temkin Group’s celebration of Customer Experience Day 2017, I delivered a webinar that tackled some of the questions we hear from CX professionals. I think the answers to these questions benefit not only people who are at the start of their CX journey, but also serve as good reminders for those of us who have been working on this for a while. I had a lot of fun putting these questions and answers together. I hope you find them helpful!
Question: What is customer experience?
Answer: We can’t start a discussion about customer experience without actually defining it. In fact, this is one of the challenges new CX professionals have. In many organizations that are starting down the CX path, employees at all levels have different understandings of what customer experience is. Until the organization has a shared understand of what it is working on, it’s hard to get people moving in the same direction.
At Temkin Group, we define customer experience as “the perception that customers have of their interactions with an organization.” Those perceptions are formed across three dimensions:
> Success: Degree to which customers can accomplish their goal
> Effort: The difficulty or ease of accomplishing their goal
> Emotion: How the interaction makes customers feel
Traditionally organizations have focused most of their attention on “Success.” But we’re seeing more organizations beginning to think about and designing for “Effort” and “Emotion” in their interactions. As they make this shift, those organizations realize that success requires developing a deeper, better understanding of their target customers.
Question: Is it too late for my company to start working on CX?
Answer: Of course not! Different companies recognize the need for different strategies at different times, and some are just coming around to putting a formal focus on customer experience. The reasons why companies should pay attention are compelling. We know customers are less than thrilled with their experiences and that companies recognize the need for improvement across the variety of channels they use to deliver experiences. And with that recognition comes the ambition to get better. In fact, in our most recent State of CX Management report, 55% of organizations report their goal is to deliver a best-in-industry or best overall CX within three years. But the desire to be great won’t get them to the top. Instead, the organizations that succeed will be the ones who marshal the commitment and discipline needed to make systemic changes to become more customer-centric.
Question: How long is my company’s CX journey really going to take?
Answer: Let’s be real here. A company’s CX journey is going to be a marathon. It will take time to mature efforts so that the company consistently delivers on brand promises that resonate with customers. But that marathon will be made up of “sprints” – individual projects or intitiaves that drive specific changes to the company’s culture and operating processes. When companies are serious about becoming more customer-centric, we recommend they work on mastering our four customer experience core competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness.
> Purposeful Leadership: Operate consistently with a clear set of values
> Compelling Brand Values: Deliver on your brand promises to customers
> Employee Engagement: Align employees with the goals of the organization
> Customer Connectedness: Infuse customer insight across the organization
As companies work on these competencies, they will progress through six stages of CX maturity. In our 2017 benchmark report, we found that only 10% of companies have reached the highest two levels of maturity, while 59% still find themselves in the lowest two stages. When comparing CX-leading companies to CX Laggards, the Leaders were more likely to have senior executives leading company-wide CX efforts, employ more full-time CX employees, and feel more supported by senior leaders across the organization.
Question: Who really owns CX?
Answer: Not just the CX team. Customer experience is everyone’s business. Change requires the involvement of every part of the company, and it won’t be successful if leaders and teams aren’t engaged in the effort, committed to doing their part, and held accountable for changing behaviors to support CX. This means everyone from Service/Support and Operations to Product Development and Engineering, to HR and Legal, to name a few. CX teams are the ones who can catalyze change through these groups by coordinating the enterprise customer experience. This includes establishing CX governance, putting standard methodologies and tools in place, and developing expertise in centers of excellence such as analytics and reporting, customer-driven process improvement, and culture change management.
Of course, organizations that want to drive sustainable CX improvements need to have senior executives who are committed to propel change throughout the entire journey. Senior executives set the direction, lead communication efforts, model desired behaviors, align resources, and hold the rest of the organization accountable. CX teams can use six levers to strengthen executive commitment, such as sharing compelling opportunities and enabling first steps.
Question: What’s the real pay-off of CX?
Answer: The pay-off is more loyal customers. Our analysis shows that there is a very large correlation between customers’ perceptions of their experiences and the various ways customers demonstrate their loyalty: buy more from the company, try new products and services earlier, forgive the company when it makes a mistake, and recommend the company to others. More loyal customers help drive financial results for any organization. As part of our look at the ROI of customer experience, we found that a moderate increase in CX generates an increase of $823 million over three years for a company with $1 billion in annual revenues.
To get started on making the case based on business results and ROI, we suggest that you:
> Enlist your CFO. If your CFO’s team isn’t involved in developing your model, then they will always have questions about your calculations and assumptions.
> Use existing metrics. Try to make your case based on the business metrics your company already uses. It will make it easier for people to understand and will help earn their buy-in.
> Be conservative. Resist the temptation to use the high end of estimates for potential benefits. While results might seem more compelling, they will also be harder to defend.
> Create a simple story. People tend to remember simple storylines, so organize your results in a way that is easy for your audience to understand.
While these may not be every question you ever had about customer experience, I hope this Q&A helps you get started with – or tighten up – your own CX efforts. Have questions I didn’t cover here? Those answers might be found on our Beginner’s Guide to CX, Voice of Customer/NPS, or Employee Engagement resource pages.
