making customer experience management real by tim walters
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Making CEM a Reality JBoye 2014 Philadelphia| 06 May 2014
Tim Walters, Ph.D. | Partner, Principal Analyst twitter: tim_walters twalters@digitalclaritygroup.com www.digitalclaritygroup.com
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A strategic inflection point
Source: Based on Andy Grove, Only the Paranoid Survive, 1996 @>m_walters
Making #CEM real means: We’re all Grace Kelly
now.
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Twlusion #1
“Strategic inflections can come from anywhere: new technologies, new competition, new regulations, new customer values and habits, etc. – anything that has a significant impact on the business itself or the industry as a whole.”
– Andy Grove
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The “dissonance gap”
STATUS
QUO
Marks the divergence between “business as usual” and what you should be doing to accommodate and leverage the new paradigm.
@>m_walters
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The “dissonance gap”
The business challenge is to correct course before the gap becomes too large to cross.
Making #CEM real means: Navigating the
“dissonance gap.” Time is running out.
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“Ex>nc>on is the rule. Survival is the excep>on.” -‐-‐ Carl Sagan
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What do consumers want from us?
@>m_walters
Twitter trumps condiments
10 Source: hQp://www.newmediaandmarke>ng.com/brands-‐have-‐to-‐master-‐complaint-‐management/customer-‐complaints-‐561
Only
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1%
feel their expecta>ons for good customer service are always met
Source: Haaris Interac>ve survey of North American consumers, 2011. Commissioned by RightNow. @>m_walters
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Say they have switched business to a competitor due to poor
customer experience
Source: Haaris Interac>ve survey of North American consumers, 2011. Commissioned by RightNow. @>m_walters
13 Source: Okeeffe & Company survey of 1,342 senior execu>ves, 2012. Commissioned by Oracle.
Global executives say the cost of not providing “positive, consistent, and brand relevant experiences” is
20% of total revenue @>m_walters
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$1.25 million per year
@>m_walters Source: hQp://www.weirdworldfacts.com/smart-‐dogs-‐with-‐amazing-‐jobs/
$89 billion “is lost by US retailers each year because of customer
defection or abandoned purchases due to poor experiences”
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IBM says . . .
Source: www.mycustomer.com/feature/experience/jim-‐glazer-‐ibm-‐store-‐s>ll-‐pivotal-‐customer-‐experience/165159
How much is at stake?
$5,900,000,000,000 ($5.9 trillion)
16 Source: Accenture, 2013 Global Consumer Pulse Research. Photo: hQp://www.t-‐na>on.com/free_online_ar>cle/most_recent/train_like_a_man_5_the_real_paleo_exercise
Making #CEM real means: Accepting that business
reality has changed. (And acting like it.)
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#CEM isn’t the Next Big Thing. It is the Next Only
Thing. #provocation
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“CX could become a fad, like Six Sigma, TQM, and CRM, as the industry fills with consultants, vendors, and gurus hoping to cash in on the CX wave.”
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The worst kind of hype?
Source: hQp://customerthink.com/the_biggest_danger_to_cx_is_simply_this_hype/
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Consumers gain voice and choice
@>m_walters
of consumers are frustrated by site content that has nothing to do with their interests
21 Source: Harris Interac>ve survey of 2,091 U.S. consumers, 2013.
@>m_walters
79% Companies “asking same ques>ons or marke>ng same offer” across channels
Sources of consumer frustration
65% Inconsistent offers or content
79% Companies “seang false promises”
Source: Accenture Global Consumer Pulse Report, 2014. @>m_walters
of consumers say that personalization influences what they purchase – 25% say
the influence is “significant”
23 Source: Vanson Bourne survey of US consumers, 2013.
@>m_walters
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Consumers expect insight
Source: Dynamic Markets study for Experian, January 2012.
“Understanding” means, e.g., “taking account of preferences, purchase history, and other provided information.”
84% said they would no longer buy from a company that failed to “understand.”
@>m_walters
Making #CEM real means: Embracing the shift from
#CRM to #CMR – customer managed relationshps. (Thanks to @collsdad)
25 Source: hQp://sapinsider.wispubs.com/Assets/Ar>cles/2014/January/SPI_Feature_From-‐CRM-‐to-‐the-‐Customer-‐Managed-‐Rela>onship
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§ Accenture surveyed over 13,000 consumers in 33 countries about 10 industries and determined: – Despite investments and initiatives, no CX
metric “has improved consistently in the past five years.”
– All metrics “lost ground in 2013”
– Companies “have been playing not to lose”
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Answer: You suck
Source: Accenture Global Consumer Pulse Report, 2014. @>m_walters
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Can “CX” be “M”d?
Source: hQp://www.bedeckhome.com/sloane-‐towels-‐2-‐colours.html
§ Customer experience (CX) is how customers perceive the totality of a their interactions with a company or brand. Note that in this definition, "customer" refers equally to prospects – those who have not yet conducted a transaction with the company – and that the “totality” of interactions includes all channels and touch points over the entire life of the relationship.
§ As a business discipline, customer experience management (CEM)
refers to the strategies, processes, skills, technologies, and commitments that aim to ensure positive and competitively outstanding customer experiences.
§ With reference to technology, CEM includes the array of software
tools that organizations use to create, store, deploy, analyze, and optimize the aggregations of digital assets that make up the user experiences on digital channels.
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Unpacking CX and CEM
@>m_walters
Making #CEM real means: Judging CEM tech and
practices from the customer’s (ad)vantage
point.
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You can manage an experience, but not the
experience of the experience. #CEM #WTF?
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Sorry, but . . .
@>m_walters
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Johanna Maria Christina Snel
Three vectors of experience
§ Environment – The thing/product experienced
§ Encounter – The interaction
between the product and person
§ Effect – A person’s response
to the encounter
Source: hQp://books.google.com/books/about/For_the_Love_of_Experience.html?id=u98ZkgEACAAJ
We say that #CEM is about the effect (perception), but we act like it is about the environment (product).
(Because the things we offer to be
experienced can be managed, but the reaction cannot be.)
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You can build Disneyworld, but you
can’t ensure the kid will have a good time there.
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That experience nonsense explained
Customer insight + brand story = experience assets
Experience assets +
interaction = customer perception = CX
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Making #CEM real means: Managing the delta
between your intent and the customer’s
perception.
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If CX is the percep>on of the TOTALITY of interac>ons, it requires a HOLISTIC company response
Source: hQp://darkroom.bal>moresun.com/2012/11/total-‐eclipse-‐of-‐the-‐australian-‐heart/solar-‐eclipse-‐draws-‐crowds-‐to-‐north-‐queensland-‐vantage-‐points-‐3/
38 @>m_walters
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The “dissonance gap”
Were these guys going to be saved by better marketing? Sales
force tools? Call center optimization?
§ Create the company’s “value zone” (Vineet Nayar)
§ Companies in the top quartile of engagement had 50% higher total shareholder return.
§ Each incremental % of employees who become engaged predicts incremental 0.6% growth in sales. (Aon Hewitt)
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Engaged and empowered employees . . .
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How are we doing with enterprise social and collaboration?
Scandinavian Internal Comms Survey (200 CIOs, 2014) § Use social internally: 19% § Contributes to emp. engagement (high): 0.57% § Improves knowledge sharing (high): 2.5% § Improves productivity (high): 0.57% § Improves mgmt-emp dialogue (high): 0.95% § Could “easily” convince top mgmt of high value of
social: 36% !!!
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Answer: Local success, lots of hard work and enthusiasm, but, in the final instance, overall, You Suck!
@>m_walters
Dreary news from the front
43 Source: hQp://www.netjmc.com/business-‐value/decrease-‐of-‐interest-‐in-‐enterprise-‐social-‐sonware-‐signals-‐a-‐shin-‐from-‐tool-‐to-‐behavior/
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Growth is slowing – dramatically
≅50%
≅78%
≅8%
Source: hQp://www.netjmc.com/business-‐value/decrease-‐of-‐interest-‐in-‐enterprise-‐social-‐sonware-‐signals-‐a-‐shin-‐from-‐tool-‐to-‐behavior/
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Deployment falters at “the chasm”
Source: hQp://www.netjmc.com/business-‐value/decrease-‐of-‐interest-‐in-‐enterprise-‐social-‐sonware-‐signals-‐a-‐shin-‐from-‐tool-‐to-‐behavior/
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Early adopters don’t . . . adopt
Source: hQp://www.netjmc.com/business-‐value/decrease-‐of-‐interest-‐in-‐enterprise-‐social-‐sonware-‐signals-‐a-‐shin-‐from-‐tool-‐to-‐behavior/
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Trivial impact on daily work
Source: hQp://www.netjmc.com/business-‐value/decrease-‐of-‐interest-‐in-‐enterprise-‐social-‐sonware-‐signals-‐a-‐shin-‐from-‐tool-‐to-‐behavior/
Social business 2016?
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Provides - Support for digitalization/
automation of work - Structure and accelerator for
business transformation
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Social
CEM
Org Transforma>on
Needs
- Business justification
- Clear/measurable impact, value proposition, ROI
Provides - Cure for declining business
performance - Structure for organization-
wide customer-centricity
Needs
- Business driver that justifies a radical shift in practice
- A “why” that proves a radical shift in the conditions of value production
Provides - A driver for org transformation - A justification for social
practices and tools (i.e., specific value-generating activities
Needs - Org-wide support - Fundamental transformation of
business practices (e.g. outside-in) - (Software) support for agility,
responsiveness, innovation, “consumerization”
@>m_walters
Making #CEM real means: Effecting organizational transformation through
social driven by customer experience.
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§ Touchpoints (web site, app, call center) are too specific
§ Customer lifecycle is too unpredictable
§ Customer journey is just right – it combines end-to-end experience with clear outcomes and team responsibilities
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Where to start?
@>m_walters
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Selected journeys (McKinsey)
§ Identify customer goals/needs § Map the journey § Determine/assign responsibilities § Measure current effectiveness/satisfaction § Identify flows and gaps for social support § Organize and/or network team(s) for
complete journey § Refine and optimize § Learn, repeat, expand 53
The road to CEM reality begins tomorrow (or, anyway, after cocktails)
@>m_walters
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“You may hate gravity, but gravity does not care.” -- Clayton Christensen
Tim Walters | Partner, Principal Analyst
@tim_walters
twalters@digitalclaritygroup.com
www.digitalclaritygroup.com
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