WHY DO ORGANIZATIONS NEED CUSTOMER EXPERIENCE MANAGEMENT (CEM) PROGRAM?

Let’s look at the real impact of Cx and why organizations need to pay attention:

• Found that 49% of executives believe customers will switch brands due to a poor customer experience
• 89% of customers say they have switched brands because of a poor customer experience. Recognize these customers did not report that they may or would switch brands based on a poor CX, but they actually did.
• 93% of business leaders say that improving their customers’ experience is one of their top three priorities for the next two years
• 97% state that CX is critical to their business success. They also understand the cost of failure is large—estimated at 20% of revenues.

As much as CEM is critical to today’s organizations, it’s not without challenges. For example, any organization embarking on CEM needs to confront with:

• Changing the organization culture aligned to customer
• Identifying new customer experiences, processes, technologies and people
• System integration between heterogeneous systems with new Cx technologies
• 360 degree view of customer since customer information is dispersed in siloed systems including multi-channel complexity
• Organization structure
• Measuring CEM ROI
• Long term vision, strategy/execution, investment and Management commitment.

Despite the challenges, organizations representing different industries and geographies are adopting CEM. The difference is some organizations have a holistic and long term view of CEM (leading-edge) while others have need based, reactive and short term view of CEM (laggards). The challenges faced by both these type of organizations are same, it’s just that the approach and commitment to overcome these challenges vastly differ from one another. It makes perfect business sense to commit to CEM long term, and here is why:

How do organizations deal with this type of rapidly evolving customer behavior directly impacting business?  One of the significant levers organizations have is to implement CEM Program. CEM is about placing the customer at the center and rallying organization’s functions, processes, technologies and people around the customer. It means, customer is no longer incidental but is focal to an organization.

It’s true that Cx impact may be different given the business environment. Cx impact has bigger footprint if the organization is directly dealing with end customers (B2C). Let’s see which industries adopt Cx and how organizations operating in these industries are performing wrt to Cx.

When we talk about CEM, it should permeate the organization’s major functions; Marketing, Sales and Support. Employees from each of these functions interact with customers often. Customers form perceptions based on the interactions they have across the functions and channels/touch-points. Therefore, it’s of paramount importance for organizations to device well thought CEM program. For example; Marketing professionals need to personalize offers based on segments/micro-segments, buying behavior, propensity for channel preferences, life time value and more.

During the course of customers’ relationship with organization, they share a lot of their personal data and therefore expect the organization to recognize their needs and meet expectations. In other words, customers expect organizations to design processes, systems and interactions keeping them in mind.  This puts organizations on spot because customers not only expect positive relationship but personalized interactions, resolution of their problems and deliver on commitments made to them consistently.

Organizations intending to be ‘leading-edge’ players, need an approach to implement CEM Program. Let’s look at the recommended approach for the same.

• Culture Change – we find many organizations where executives, employees, processes and culture considering customers as incidental and not focal to their business. This is immensely detrimental to any organization embarking on CEM Program. Change is hard, time consuming, need intensive energy & effort, persistent policies, programs to reward, recognize employees, leadership vision & commitment. Organizations need to foster customer-centric culture with the above approach. Employees are key, must ensure employees embrace this change with energy and enthusiasm. Because, happy employees always results in happy customers. Remember, what Peter Drucker said ‘culture eats strategy for breakfast.’ So avoid that trap.
• CEM Team – form a core team with executive sponsorship. This team essentially drives all Cx initiatives within and outside the organization. Organizations need to ensure this team has a healthy representation from multiple functions, visibility across the organization, access to management, authority make decisions and resources to perform their duties.
• Objectives & ROI – No initiative without well-defined Objectives, KPIs, Metrics, Timelines and ROI will sustain for long especially when resources are limited. According to the Global Customer Experience Disruptive Studyresearch; top cited CX objectives included: Organic Growth (50%), Customer Retention (48%), Differentiation (44%), New Customer Acquisition (35%), Operating Efficiencies (33%) and Customer Advocacy (22%). Organizations need to identify the most critical objectives and rally their people, resources and leadership behind them.
• Customer First Approach – start with customer, reach out to them to enlist feedback on what they like, dislike, need improvement on your product/service, process and support. Often, these insights surprise many organizations. Identify key areas to improve, incrementally. Starting point could be to define customer journey maps, identify the processes (old and new) to enable these journeys, map them to existing systems and gather data from data warehousing to drive insights.

• Cx Technologies – team requires tools and technologies to better articulate customer journeys, inculcate design thinking, customer profiling (segmentation at multiple levels), simulate scenarios, targeted campaigns, personalize content, build Mobile PoCs/Prototype, Analytics to measure results and more….
• Understand Customer Behavior – customers use multiple channels to interact. For example; product discovery is done through mobile or online, research about product reviews is done through social media, blogs, reviews, visit store to try the product, make purchase online, interact with staff through email, online chat and call centers. Organizations can establish a co-relation between a customer and channels preference to understand behavior and therefore define an engagement approach.

• Provide Omni-Channel Experience – organizations traditionally have created functions, processes and technologies which operate independently. In such environment, it’s challenging for organizations to achieve 360 degree view of customers, engage customers with cross-channel persistent behavior. However, with new technologies, big data, analytics, it’s possible to create an Omni-channel experience. Retailers are a good example for successfully adopting omni-channel strategy

I conclude by reinforcing the need and urgency to adopt Cx strategy. In this extremely competitive and dynamic business environment, traditional competitive advantages like product features, pricing, offers, and support are blurring and capricious customer behavior is adding to this. Cx has the potential to create real and sustainable competitive advantage because putting together a strategy, execution, cultural change and continuous improvement is not easy and many organizations fumble at that. After all, a happy customer gives repeat business, demonstrates loyalty, recommends product and becomes your champion.