Customer outcomes never differ from business outcomes, and vice versa.
Customer outcomes are why your business exists.
— Providing value for their needs.
— Their funding fueling your life.
— Their preference is your growth.
— Their expansion fueling investors.
— Their responses guiding your strategies.
How you run your business IS what customers experience (= their outcomes).
Business outcomes are customer outcomes.
— Your costs are their costs . . .
in money, stress, time, resources, opportunities.
— Your gains fuel their future . . .
in abilities and value potential.
— Your choices are their experience . . .
in growing or eroding trust.
These facts apply to governments, non-profits, and businesses of all types, regardless of region, industry, model, size, or maturity.
Built-in customer experience causes and effects are in every:
— Corporate objective (strategic pillar).
To win customer preference via your capabilities, costs, stability, etc.
— Non-customer-facing role.
To create value for customers or those who serve them.
This 4th of 5 chapters in this CX ROI Handbook covers:
A. Customer & Investor Care-Abouts
B. Outcomes Self-Assessment
C. Your Costs Are What Customers Experience
1. Deliver What You Promised
2. React to Promises You Broke
3. Handle Changes Customers Make
D. Growth Outcomes
E. Conclusion: Insights Usage
Customer & Investor Care-Abouts
Customers care about your business . . .
— Effectiveness: to achieve their objectives.
— Continuity: to meet their evolving needs.
— Costs and efficiency: for high value and low prices.
— Integrity: be clear and keep promises.
Your value proposition is your contract.
You owe what you promised them.
Investors care about your customers . . .
— Revenue growth: from customer buying.
(Funded only by investors is a Ponzi scheme.)
— Profit growth: from smooth customer outcomes.
Maximize earnings per share.
— Stability: from customer preference.
Sustain competitive advantages.
Customers do not care about your excuses, bonuses, etc.
— They’re busy. They rely on dozens of entities daily.
— Be realistic. Prevent excuses.
Prevent anything beyond the value propositions they directly accept.
Outcomes Self-Assessment
Every time you mention revenue, do you include why and how it affects customers?
— In the same sentence?
— In the sentence before or after?
— Same for these words?
Reduce, increase, grow, expand,
cost, budget, efficient, effective,
profit, metrics, KPI, OKR,
dashboard, scorecard, performance,
review, restructure, investor, invest,
pillar, objective, strategy?
If not, your thinking is siloed. And you’re perpetuating silos.
— Assumption, vision, goal, metric, and handoff silos = Execution Silos.
— Process, data, system, channel, and organizational silos = Operational Silos.
— Execution silos intensify operational silos.
— Silos waste precious budget and opportunities!
This is the power of your thinking and phrasing.
Phrase customer outcomes and business outcomes side-by-side.
— Make it a habit:
In staff meetings and all reviews.
In strategic planning and all approvals.
In assignments and conversations, etc.
Constantly connect business outcomes and customer outcomes because they aren’t separate.
Your Costs are What Customers Experience
All costs are in 3 categories.
1. Deliver what you promised.
2. React to promises you broke.
3. Handle changes customers make.
1) Deliver What You Promised
Your value proposition to customers.
This is the majority of your company-wide business expenses.
— This is WHY you exist.
— Includes all non-customer-facing roles and your partners and suppliers.
— Enablement of value to customers and support of customer touchpoints of all kinds.
See these calculation formulas in chapter 2 of this CX ROI Handbook: Proving CX Value to Executives.
10. Revenue gained by avoiding inflation and shrinkflation.
11. Value of customers’ increased productivity in their life or business.
12. Value of process or policy change for ease of business.
13. Value of proactive expectations management.
21. Value of CX-inspired efficiencies.
22. Value of CX-inspired performance.
| Good Costs |
Bad Costs |
| Actions aligned to customers’ needs. |
Actions misaligned to customers’ needs. |
| Examples: Retention costs in your marketing plan to keep customers informed for the lifetime of what they bought and proactively manage inevitable competitor moves. |
Retention costs for misalignment, such as engagement incentives and purchase incentives to offset immature or undifferentiated products and services, missteps, and other preventable weaknesses. |
| VoC to explore customers’ expectations as your North Star. |
VoC score begging for bonuses or benchmarks, etc. |
| Strategies of EVERY department shaped by customer insights. |
Industry norms shaping business-as-usual. |
| Processes and policies streamlined per customers’ needs. |
Cost containment decisions siloed without regard to customer impact. |
| CX focus on aligning companywide thinking and actions to customers’ needs. |
CX siloed to UX, DX, CRM, CS, etc. or duplicating Sales and Marketing responsibilities. |
CX is customers’ ROI on your behaviors.
CXM is your reactive and proactive management of CX.
Bad CX and bad costs and bad growth go hand-in-hand, self-perpetuating. Good CX and good costs and good growth go hand-in-hand, self-perpetuating. Use customer insights as your guardrail from the start and ongoing.
Start with a crystal clear understanding of expectations as the basis for everyone’s role and actions. See the how-to section in chapter 3 of this CX ROI Handbook: Connecting Customer Experience and Employee Experience ROI.
2) React to Promises You Broke
Anything varying from value proposition.
This is the majority of your Support expenses.
— Includes mis-steps of all non-customer-facing roles and your partners and suppliers.
Unclear or frustrating to customers.
Broken, missing, or non-functioning.
Your missteps and extra steps for them.
See these calculation formulas in chapter 2 of this CX ROI Handbook: Proving CX Value to Executives.
1. Value of customers’ time reduced in waiting, repetition, etc.
2. Sales cycle to overcome doubts.
3. Value of trouble-shooters for the issue resolved.
4. Value of trouble-shooters redeployed to value-creators.
5. Cost savings of reduced emails and meetings to correct snafus.
6. Value of stopping rework and redundancies.
7. Employee retention.
8. Productivity increases when jobs have less negativity.
9. Remedial costs to serve this issue.
| Good Costs |
Bad Costs |
| Turnaround potential loss via effective Support reducing mistrust, negative word-of-mouth, churn, returns, refunds, escalations, fines, and lawsuits. |
Force self-service. Make Support hard, time-consuming, boring, annoying, repetitive, impersonal, etc. |
| Stop recurrence of chronic issues by engaging all originators of root causes to mistake-proof these issues. |
Cross-sell in frustrating circumstances as they contact you in Support. |
| Shape all decisions companywide by data-mining customer comments. Support is a treasure trove for discovering customer circumstances, objectives, expectations, workarounds, etc. Tailor findings to every work role company-wide. |
Digitalize without agile methods and feedback loops. Over-invest in reactive tech vs. preventive processes. |
Customer Support is an inherent value center to your business. Re-think how you harvest and harness Support’s customer insights and churn turnaround.
3) Handle Changes Customers Make
Anything you cannot influence.
This is an under-anticipated source of trust or distrust.
— They changed their mind.
— They misused your product/service.
— Change happened to them: death, birth, flood, robbery, accident, moved, re-organized, etc.
| Good Costs |
Bad Costs |
| Proactive simple processes. |
Reactive or hard for them to find or execute. |
How you operate your business is the experience of your customers, employees, partners, communities, and investors.
Growth Outcomes
Costs and growth are intertwined.
— As you emphasize good costs, you enable good growth.
— As you emphasize good growth, you enable good costs.
Think holistically about the purpose of every work role, organizational routine, and effort to grow.
See these calculation formulas in chapter 2 of this CX ROI Handbook: Proving CX Value to Executives.
14. Value of customer-first invitations, engagement, and messaging.
15. Purchase behaviors after a CX intervention.
16. Purchase behaviors after a CX innovation.
17. Value of customer-centered management and design.
18 Value of recommendations.
19. Value of preferred brand.
20. Value of wallet expansion.
| Good Growth |
Bad Growth |
| Ideal customers identified at the intersection of lucrative purchase trends and well-suited for your business to serve (low Support costs). |
Customer acquisition out-of-sync with your business’ strengths to serve them efficiently. Customer expectations are too varied. |
| Agile design with deep customer insights, divergent thinking, frequent customer feedback and design tweaks in each design stage, verification, and validation. |
Minimally viable product that relies on Success teams instead of agile design. |
| Margin expansion via organic demand for your premium offerings. |
Raising prices or shrinking value to offset chronic discounts and high Support costs. |
| Account expansion via sole supplier status and cross-selling in positive circumstances. |
Locked-in customers via high switching costs. |
These are not comprehensive lists of good and bad practices in costs and growth. Use this guide to re-think your business practices overall, in addition to your customer management methods.
When you use customer experience insights to guide every growth effort, then right-the-first-time multiplies your growth.
Conclusion: Insights Usage
The most-admired brands such as Ritz Carlton, Disney, Virgin, etc., strive to be customer-aligned in all headquarters decisions and actions — as well as touchpoint decisions and actions.
Good costs strengthen customer relationships.
— Frees-up their time, money, resources, and opportunities.
This expands their productivity in their life or business,
which expands their ability and desire to expand with you,
and their uninhibited recommendations.
Bad costs weaken customer relationships.
— Ties-up your time, money, resources, and opportunities.
Escalations sidetrack managers from proactive pursuits.
Troubleshooting derails engineers from designing new value.
Weak trust and doubts lengthen your sales cycle.
Extra Marketing and Sales required to make up for all this and still grow revenue monthly.
Customer outcomes never differ from business outcomes, and vice versa.
— Ignoring this rips off investors from huge potential.
— Honoring this improves employee experience and productivity.
— Including this in all your money comments helps you avoid misalignment.
Customer-aligned business requires emphasis on Insights Usage Rate. Getting in sync with customers is your key to reversing deep habits in bad costs and bad growth.
Use customer insights to awaken new habits for good costs and good growth. Customers are the source of your salary, budget, and profit-sharing. Respect it.
Maximizing usage of customer insights across your company will reinforce the strengths of connected business outcomes and customer outcomes.
This article is the fourth in a five-part series:
1. Customer Experience ROI Handbook: What is CX ROI?
2. CX ROI Handbook: Proving CX Value to Executives
3. CX ROI Handbook: Connecting Employee Experience and Customer Experience ROI
4. CX ROI Handbook: Business Outcomes and Customer Outcomes
5. CX ROI Handbook: CX Dashboards and Compensation (October)
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