Three ways to ensure your CX initiatives drive desired business outcomes

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I just returned from a fantastic two days in New Orleans at the CXPA Insights Exchange.  New Orleans is one of my favorite cities – it had been over a decade since I have been there and it was great to see the vibe of the city has not changed. The only thing more impressive to me than the spirit of New Orleans was the energy of the 300+ CX professionals I interacted with.  As I reconnected with old friends, met new ones, and reflected on the history of CXPA – it was great to see that the passion of the CX community remains as strong as ever.

What has changed over the years though has been the primary challenges CX professionals face. The theme of this year’s conference was “CX Business Value”, which was appropriate because linking CX to tangible business outcomes has become one of the most important topics keeping CX leaders up at night.

One of the main reasons why CX took off in the first place was early research, which made the general point that great customer experience drives long-term profitable growth.

Demonstrate relationship between action and outcomes

External research – along with a rooted belief in the value of CX – was often enough to justify initial expenses to get CX projects up and running.

Some organizations took this a step further and made an internal business case projecting future benefits. Typically, this involved linking CX to future financial performance and other data-driven analysis.

This has been enough to maintain investment in CX for some time. But many mature CX departments are at a crucial inflection point now where the C-suite wants tangible proof points of CX investments driving business results.

Organizations that are able to demonstrate value in this way are gaining additional investment in CX and are poised to become genuine CX leaders. However, there are many companies that are struggling with this task. These organizations are at risk – slowly but surely – of losing executive commitment and being subject to reduced investment levels.

The graphic below illustrates this and why demonstrating the business impact of CX is more important as your CX program matures.

Demonstrable results from your CX initiatives helps build momentum and investment

Momentum and the ability to demonstrate a relationship between action and outcomes are key to CX success. So how can you clearly tie your activities to business results?

1: Fully understand your customers

Most companies ask for feedback from their customers. However, there is a difference between just asking for feedback and truly understanding your customers’ needs. Too many organizations rely on a handful of feedback channels that are convenient to their own needs. The result is feedback that may not truly represent the views of the broader customer base.

Assess customer needs across all VoC sources

To understand the entire customer journey, you need to assess customer needs across all VoC sources.

According to Gartner, CX leaders demonstrate integrated collection, analysis, distribution and action across three types of VoC data:

  • Direct feedback: Feedback direct from your customer in a format intended for this purpose (e.g. survey, opt-in feedback either on or offline etc.)
  • Indirect feedback: Feedback about you but not directed at you in a format intended specifically for that purpose (e.g. occurs on social media, contact center, live chat etc.)
  • Inferred feedback: what customers would say about their experience if they were asked at any given moment(e.g. can be captured digitally through session replay or through IVR logs in a contact center)

The only way to know exactly what your customers need is to factor all these different types of feedback into your analysis. This gives you the complete picture, providing you with insight from right across your customer experience to fully optimize CX that drives discernible and tangible business results.

2: Only pursue CX initiatives aligned with your brand promise

Say you do understand your customer needs. This still doesn’t mean – in itself – the improvements you make are going to drive business impact. Many companies, for example, listen to their customers but end up pursuing CX initiatives that are not aligned with their brand promise or core competencies.

These initiatives could be completely in line with customer sentiment but if you’re not equipped as a business to pursue them or deviate from your organization’s primary objectives, you’re unlikely to have the sort of impact you need to have significant positive outcomes.

Know your strengths and play to them

Great brands are true to their promises while typically offering very different experiences. Think about where you fit in comparison to your competitors.

Does your CX stand out due to your product, service or price? Know your CX strength and play to it.

More realistically, you need to focus on a single key area. Know your strengths, play to them and don’t deviate. Confusion around your objectives and misaligned CX initiatives make success much more difficult. Great CX is not a uniform panacea.

You can say you want to be a leader in your main area of strength. But how are you can tie CX to this broader corporate objective?

3: Measure success in a way that breeds more success

Inefficient or inappropriate reporting can be a huge roadblock to driving measurable business results through improved CX. How can you expect to shift performance if you are not measuring that performance effectively?

For example, companies often use post-call survey responses to assess the performance of and incentivize their staff. But this nearly always ends up skewing the results. Typically, employees will push the survey to such an extent that customers can’t help but provide overwhelmingly positive results.

The upshot: the end results are misleading and don’t provide insight that will lead to meaningful results. This is a flawed metrics approach that actually prevents investment aligned with business goals.

Employ a variety of CX metrics to collectively track desired outcomes

NPS, CSAT and so on are all great metrics but they measure different things so need to be taken in context. There are complex relationships among each of these CX measures so they should be considered collectively.

There are five different metric categories that should be measured:

  1. Emotional engagement: How somebody feels about the interaction – indirect and direct feedback methods are very effective in establishing this.
  2. Satisfiers and dissatisfiers: What is it that’s driving the satisfaction or dissatisfaction in any interaction? In capturing this information, you start to collect key operational performance metrics and objective dataset that inform your business strategies going forward.
  3. Ease: How easy it is for your customers to achieve what they want to with your business (e.g. how many clicks to complete a task, how many calls are required or visits to one of your locations does it take to resolve an issue etc.)? According to the CEB, 96% of high-effort experiences result in overall disloyalty and 81% result in negative word or mouth. You therefore need to ensure the metrics you capture address this factor.
  4. Advocacy: Customer advocacy metrics – such as NPS and CSAT – are important indicators of perception in the marketplace and therefore should be factored into your analysis. However, they cannot by themselves accurately indicate revenue so need to be incorporated alongside other performance-focused measures.
  5. Loyalty: How you assess loyalty should be tied to financial metrics. How long is the relationship? How has expenditure evolved in that time?

A CX measurement approach combining metrics assessing each of these factors provides a complete picture of customer sentiment in the context of broader business performance. You can then focus action in the most impactful way.

Conclusion

Many companies struggle to vividly tie their CX strategies to business results and end up losing momentum in their efforts to optimize the customer experience as a result. However, there are a number of actions you can take to ensure this isn’t the case for your organization.

Specifically, you should concentrate on implementing a comprehensive VoC program that captures direct, indirect and inferred customer feedback. You should also ensure you measure your customer experience using a variety of different metrics to enable you to get complete picture of where you need to focus your action.

Finally, you should ensure the primary focus of this action ladders up to broader business objectives.

Once you’re able to successfully bring these three factors together, you can more easily demonstrate value and results. This in turn enables you to grow the influence of you personally, your broader CX organization and customer experience generally.

You can find out more about how to drive measurable outcomes from CX initiatives by watching the webinar I recently presented with Jeff Lewandowski from Andrew Reise Consulting or downloading this recent ebook we published.

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