In the last 12 months, I have seen a major increase in organizations focusing on trying to understand and manage their customer experience. I have long been critical that organizations have been too introspective, so I am hopeful that this is a sign that they are finally looking beyond their CRM systems, analytics and propositions to try to understand what their customers are really experiencing. There is little doubt that executives would quickly alter policies and processes if they were in possession of this insight, rather than the apparent "insight" gathered from transactional data.
The customer experience is unequivocal. It is what it is, and no amount of interpretation and spin can change what customers actually experience and feel about doing business with organizations. But how is the customer experience created, and how can we assess it and then optimize it to the mutual advantage of the customer and the organization?
I am working with the Quality of Experience (QoE) Forum, whose members are senior managers from large organizations with a varied range of responsibilities including quality, customer service and customer marketing. The very spread of these responsibilities is a clue to the challenge they face, as companies tend to think the responsibility for improving the customer experience resides within one function or part of the business rather than within the organization as a whole. The findings of the QoE Forum so far are:
- The tendency is to treat the symptom and not the cause.
- The customer experience is inconsistent across the organization.
- There is little ownership of customer experience problems and even less reward for addressing them.
- Identifying the capabilities that create the customer experience and then aligning them to a common goal is extremely challenging.
- Communication and leadership on customer experience are not prevalent.
"Systems Thinking" is a scientific approach that works backward from any outcome to try to determine the source and interdependency of what creates it. Process analysts may know this as root cause analysis or Ishikawa. Working with the QoE Forum, we applied Systems Thinking to the customer experience, and the following results show the key drivers:
Source: Round (U.K.) Ltd, 2006
This list will certainly be no surprise to anyone who has focused on this topic. However, we have now defined all the capabilities for each of the above "strands" and mapped these to one of four different business states:
- The product-centric organization which generates a functional experience
- The customer-service-focused organization that improves the customer experience, processes and propositions through continuous improvement, using direct feedback from customers or customer-facing teams
- The customer-value-focused organization that maximizes customer profitability by offering tailored propositions and experiences
- The customer-centric organization that provides customer-designed experiences and propositions driven by the customer who is an extension of the organization
These four business states are really different types of organization and, together, they form the key dimension that is missing from most businesses. Yet, it is a dimension that is essential to aligning what the organizations do to ensure consistency of the customer experience and operational harmony. It is the lack of alignment that creates the internal tensions and external inconsistencies.
|Who Owns Capability?
One of the key questions I am asked is, “Who should lead this work and own the capability database?” Customer service can certainly lay claim to being the organization’s customer conscience, as customer service people see the effect of the organization’s errors and inconsistencies every day. Likewise, business improvement or organizational effectiveness teams could see this as a key enabler, as it provides both “as-is” and “planned to be” states.
In my opinion, the ideal home is marketing, as marketers tend to own the customer strategy as well as the responsibility for defining customer propositions and assessing customer satisfaction. However, this is not the marketing that myopically focuses on analytics and campaigns; this is the marketing that is strategic and forward-looking and which wants to ensure that the rest of the organization is fully aligned with the vision and brand it is projecting into the market.
But marketing is just the custodian of the process and the data. Every manager must have access to the capability data to guide the day-to-day development of the organization. Most of all, the executive team must own the profile, review its development and ensure the organization is fully aligned, harmonious and consistent, because that leads to happy customers, happy employees and happy shareholders.
For example, I have seen cases where marketing buys a smart new system that is able to analyze customer data and insight to predict exactly what an individual customer might need, but the propositions and products cannot be tailored to an individual customer. Or the customer data model cannot hold the extra insights to enhance the analysis. Or the segmentation model is optimized only for macro segments. Or the customer service team is unable to engage the customer when they call because they are driven to reduce call handling time. Or the customer-facing systems cannot hold the detail of the relevant offer.
When this happens, the analytics team will soon get frustrated and the fancy, targeted offer sent out by outbound direct mail doesn’t mesh with the customer experience. The end result is that the customers are so confused, they don’t buy. These situations have a severe impact on the analytics systems’ return on investment.
QoE Forum members are now assessing the capabilities for each of the "strands" within their own organizations to determine which ones are in place across the whole organization, which are partially in place and which are missing. Only then can they determine where to focus operational energy and capital investment.
The value of this approach is:
- The capability assessment process engages the organization in understanding what drives the customer experience.
- The resultant profile is effectively the organization’s customer experience DNA and clearly shows the misalignment of capabilities (strengths and weaknesses).
- The planned (approved) changes to capabilities can be included in the profile to show the forecast impact of planned changes, whether, for example, they will make the alignment better or worse.
- The list of "strands" can be optimized (tailored, grouped and ordered) for each organization to show the "picture" in the way each part of the organization needs to see it.
- The results show why the organization needs to determine what kind of business it wants to become to create alignment and consistency.
- Once this has been determined, a gap analysis can be created to focus and prioritize operational planning and capital investment.
- The capability framework is an organizational competency model that guides the scoping of operational activities and change projects to align the organization at the chosen target through incremental change that engages every function.
The QoE Forum program will be guided by common gaps across member organizations. The QoE Forum will also support the assessment process and work with members to operationalize the results and recommendations.
The next step is to link feedback from customers, suppliers and channel partners to provide a 360-degree view of all the capabilities that directly impact the customer experience.