Customer Experience Leaders & Laggards – What’s the Difference?

Customer Experience leaders grow revenue faster than CX laggards, drive higher brand preference, and can charge more for their products.
— Forrester’s Rick Parish.

The benefit of CX is now well documented even if organisations are still struggling to link its value to business outcomes. If its value is recognised, why don’t more organisations learn from CX leaders and strive to deliver more consistent, predictable and enhanced experiences for their customers?

A Harvard Business Review Analytic Services study of more than 400 executives helps shine some light on where leaders and laggards differ. They explored the adoption of effective Customer Experience management practices amongst the sample and whether the foundations for Customer Experience excellence were in place.

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What is clear from the larger differences is that leaders have Customer Experience support foundations in place: sufficient budgets, systems, organisation, skills, processes, and plans. When it comes to recognising the importance of Customer Experience management there is less difference; but execution or effective follow through appears to be lacking with laggards.

Leaders and Laggards face similar Customer Experience challenges. What appears to differ most, is how both sets respond. As the authors of the study summarised: “they (leaders) aren’t waiting for someone else to solve these problems for them. They’re dedicating the resources to figure them out for themselves ahead of the competition. Armed with an intrinsic belief in the business value of Customer Experience excellence, they’re putting the funding, processes, and strategy in place to overcome these hurdles. As a result, these leading-edge companies perform substantially better across the whole range of business measures, from profitability to customer retention rate.” 

According to this HBR study, one of the principal differences between leaders and laggards, is that the latter are less likely to map customer journey interactions and illustrates that leaders recognise the importance of really understanding the end to end journey through a customer lens.

Interestingly, laggards are on (the right?) track in eliciting customer feedback and are more likely to respond to individual customer’s feedback, than leaders. They are perhaps not measuring and acting upon the right things. This ‘responding to feedback’ is one area where we can see laggards as a group doing more of, than leaders. Transactional, complaint, social or whichever direct feedback is important and does gives a barometer of the quality of the delivered customer experience at that point in time – so that companies can take action. It can help them fix pain points and improve those parts of the experience that they receive the feedback on. This action is reactive and based on past or present behaviour, events or interactions. If they were to take a step back to understand the end to end customer journey, they would be able to deliver a customer experience that focuses specifically on customers’ most important needs or greatest issues and to in turn connect customer feedback and measurement to these areas of greatest value and opportunity.

Leaders are more likely to combine a deep understanding of the end to end customer journey, a programme of on-going customer listening, along with direct customer feedback to not only have the snapshot ‘read’ of the experience but also as a diagnostic to predict behaviour, to shape and design the journey, to optimise, transform and innovate the customer experience.

We work with companies just starting out in Customer Experience as well as those who are more advanced along their Customer Experience path. Some that come to us have implemented a Customer Experience management or Voice of Customer program, are on the way to being more customer-centric, are making tangible enhancements to their customer experience but are still not seeing the improvements and value they had hoped for.

We have built our Customer Experience ‘principles’ based on what we have seen over the last 15 years. Delivering Customer Experience excellence involves changing a company from the insight out.
So how can organisations move from laggard to leader? We believe that excellence in Customer Experience is based upon 5 principles.

Principle 1: Value your Customer
The ‘right’ insight is at the core of Customer Experience.

  • Leverage existing insight. Continually listen to customers. Understand and analyse customer insights across the whole organisation

  • Have a deep understanding of what matters most to customers – and of both their rational and emotional journey

  • Diagnose where customer effort is high in the end to end journey and create solutions to reduce this

  • Map & prioritise customer journeys and pain points. Understand which journey stages drive satisfaction or dissatisfaction

  • Conduct journey and root cause analysis of transactional voice of customer data

Principle 2: Establish an Experience Roadmap
Know where you are headed (and how that works for the company and brand) before you jump into execution mode.

  • Establish what you are seeking to achieve via a clearly articulated customer experience vision and strategy

  • Ensure a link back to overall business imperatives and priorities

  • Ascertain the value that business aims to gain, how to measure success and appropriate business outcomes

  • Recognise how to fix and deliver the basics but give enough attention and effort to journey peaks with opportunities to delight customers in the improved experience

  • Streamline the journey and seek to cut steps which add no customer value

  • Determine a plan for short-term, continuous improvement and innovation in the customer experience

Principle 3: Build a Customer Centric Culture
Alignment of organisation, employees and leadership around the customer are at the heart of Customer Experience. Focus on ascertaining:

  • A committed CEO

  • An engaged and collaborative C-Suite

  • Clear and respected ownership of the customer experience

  • Commitment and certainty in the value of cx excellence within the business

  • Agreed customer roles & responsibilities

  • Employee engagement & empowerment

Principle 4: Give your Business Control
Once insight, strategy and commitment are established, ensure that you enable the organisation to be able to deliver.

  • Ensure ongoing delivery and regular review of customer priorities

  • Establish and leverage consistent customer feedback and learning

  • Continuous improvement of the customer experience

  • Customer and operational data integration and sharing

  • Develop a measurement strategy, framework, key kpi’s, agreed outcomes and implementation plan

Principle 5: Embrace technology as an Experience Enabler
Ensure that touch points are connected and each adds value to the experience for the customer.

  • Establish customer, technology and industry influencing trends

  • Build scenarios to respond to the empowered and digitally connected customer

  • Define the role, balance and interplay of digital and human touchpoints in meeting customers changing needs

  • Recognise organizational implications of digital optimisation and enablement

Not much to do then! Customer Experience issues are highly visible outside of the organisation. No-one wants unhappy customers. Remember though that effective Customer Experience practice must start from within.

Only 20% of organisations deliver a good or great CX. Do you want to be in the 20% and deliver experiences that lead to happy customers and a smiling organisation; or be in the 80% who follow?

Image courtesy of Pixabay