Educational Whitepaper. Customer Experience. How Committed Are You?

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1 Educational Whitepaper Customer Experience How Committed Are You?

2 Customer Experience How Committed Are You? Customer Experience as a Competitive Differentiator Competitive differentiation in the telecom industry is becoming increasingly difficult. Wireline providers that are expected to provide an outstanding network get dinged when problems occur, and get little credit or recognition for the content they provide. Wireless carriers have more control over the connected device, but must deal with the complexity of trying to connect a moving target seamlessly. One area that has come to be viewed as a key competitive differentiator is the customer experience. Gartner defines Customer Experience as the practice of designing and reacting to customer interactions to meet or exceed customer expectations and, thus, increase customer satisfaction, loyalty and advocacy. How satisfied are your customers with your services, from initial research, through the purchasing process, usage of your product or service, billing and post-sales support? How do you find out? Annual customer satisfaction surveys? JD Power rankings? One or more Customer Experience Management (CEM) initiatives? Many executives confuse CEM with Customer Relationship Management (CRM). CEM is based on an external view or perception of a company; looking at things from the customer s perspective. CRM is based on a technology solution for managing a company s interaction with the customer. Technology plays a part in CEM, but it is in a supporting role. The customer is the lead player. Planning these events and activities is invaluable, and should be the normal course of doing business. Typically the events are carefully thought through, agreed upon and implemented at all levels within a carrier organization, and everybody knows what s expected of them. CEM is based on an external view looking at things from the customer s perspective. Key Success Elements of a CEM Program There are a number of key elements that need to be in place to ensure a successful Customer Experience program: 1. Executive level sponsorship: As with any change management initiative, a CEM program will not succeed without this key ingredient, yet it seems to be the element most often missing from these programs. All management, from the CEO to the line supervisor, must demonstrate support and commitment to the CEM program or it will be impossible to overcome the resistance to needed change that will inevitably surface. 2. Program Leadership: In a mature CEM program, the senior Customer Experience executive must be dedicated full time to the program, and endowed with the power required to obtain the buy-in of all operating executives. Assigning CEM as an additional

3 3 responsibility to a senior manager in Marketing or some other functional area may be an initial strategy at program launch, but it is not a recipe for long term success. CEM should have the benefit of a dedicated C-level executive. Without this demonstrable executive level support for the program, CEM will have difficulty in gaining the traction necessary to succeed. 3. Long term commitment: Customer Experience is not an initiative. It often requires a fundamental change in the way a company interacts with its customers. The organization needs to be fully invested in CEM for the long term. Most likely the benefits of embarking on this journey will not be immediately apparent. However, the successful implementation of a CEM program will typically have a positive long term impact on the organization in terms of reduced customer churn, increased revenue per employee and increased customer referrals. 4. Funding: A Customer Experience Management program is not cheap. If the program is underfunded, it will not succeed. On the other hand, as has been demonstrated time and again by successful programs in many industries, if a company is willing to look long term, there is a definite ROI for CEM. So, let us assume you have all of the above key ingredients in place. Where do you start? Initial Assessment A good starting point is an assessment of the CEM initiative you currently have in place. Do you have a core organization (departmental or enterprisewide) that can be built on or will you be starting from scratch? Has someone been appointed to head up the organization and lead the initiative? What customer-focused metrics are in place? You may find that you have one or more CEM initiatives underway at the department level that would be characterized as Initial in the chart below (Figure 1). These initiatives might not have Figure 1 - CEM Program

4 4 corporate support or visibility at this time, but could form the core of a corporate program going forward. Most companies are still in the Initial to Defined maturity levels (as defined by Gartner) with very few having reached the Optimizing level. Initial initiatives might not have corporate support or visibility at this time, but could form the core of a corporate program. Regardless of where your organization s CEM efforts fall in this Maturity Level CEM Program Model, the chart can provide you with a roadmap of steps you need to take for further development of your CEM program. Along with the Gartner model there are also a number of other CEM maturity models available to work from, such as the TM Forum Maturity Model that is part of the Customer Experience Management Solution Suite. Select the model that best fits the needs of your organization as you implement your CEM program. Customer Journey Mapping A key element in a Customer Experience is Touchpoint Mapping or Customer Journey Mapping. The map in Figure 2 is one example. This approach has quickly grown in acceptance because it provides a holistic view of the company from the customers perspective. From the initial point of contact in what is typically referred to as the awareness phase through the entire customer lifecycle, the journey is diagrammed to show the touchpoints - or points of interaction - between the customer and your company. There are multiple dimensions to this mapping including the phases of the customer lifecycle, Source: TM Forum ** Figure 2 - Touchpoint Mapping

5 5 the contact channels (website, advertising, retail store or outside sales contact, customer service or technical support contact center, bill presentation and social media) and customer personas. Most importantly, the mapping initiative involves company customers (or prospective customers) and customer facing company employees in the development of the diagrams. It is important to understand there is not going to be a single map as each journey undertaken by a customer may follow a different route. This is where personas come into play. Millennials will use the website (or mobile app) and possibly chat while checking social media to see what referrals they can find before initiating a purchase. Frequently, they will complete the transaction without ever talking to an employee of the company. Conversely, baby boomers may rely entirely on the contact center or retail presence to guide them through the process. By involving customers in this, you are truly gaining the perspective of your customers and their emotional involvement in the journey. At each touchpoint you have the opportunity to gauge the customers emotional level to determine if the underlying processes are meeting or exceeding expectations at that point or if the customers are meeting with disappointment, frustration or a similar negative emotion which can destroy the entire experience and result in the loss of customers and negative word of mouth. Therefore, the development of customer journey maps will provide you the opportunity to assess your people, processes and systems in their ability to provide a high level customer experience. Then comes the hard part: for those touchpoints that create negative experiences for the customer, what are the underlying causes? Poorly aligned processes? Outdated or inadequate support systems? Internally focused policies and procedures? As these root causes are uncovered and corrected, it will be important to develop internal and external communications and employee training and recognition programs that reinforce the type of employee behavior that provides an outstanding customer experience. As with any change initiative it will be important to use customer journey mapping as a key element in continuous change, always keeping the customer front and center. The development of customer journey maps will provide you the opportunity to assess your people, processes and systems in their ability to provide a high level customer experience. Technology Implementation Technology is a key element in a successful Customer Experience program. However, it is important that new technologies are implemented not just for reduction in staffing, but to truly enhance the customer experience. Customer facing systems, including web sites, IVR, virtual agents and social media tools, should be designed from the customers perspective. The systems utilized by customer-facing employees, from sales to order management, provisioning, service delivery, billing and technical assistance center (TAC) need to be designed to enable the employee to have the information required by the customer readily at hand, eliminating the need for multiple handoffs. Customers must also be unaffected by the internal restrictions of functional silos, and should receive a seamless experience regardless of their journey touch points. Finally, it is key to identify and prioritize those systems projects that will need to be implemented as the customer experience program matures in order to provide the continual enhancement in usability and data richness that will be required.

6 6 The systems utilized by customer-facing employees need to be designed to enable the employee to have the information required by the customer readily at hand, eliminating the need for multiple handoffs. It is also essential that consideration be given to what Customer Experience applications will be acquired and integrated into the company s core systems. The following are some questions to ask as you examine the technology requirements for CEM: What technology tools are provided by my company to the customer? What internal tools are used by our customer-facing employees? What customer analytics have been performed to identify who the customer is do we have different methods for managing the customer experience for different types of customers? How is customer feedback being collected and acted upon today? The Human Element in CEM Self-service is a key element of customer experience technology. Customers are becoming more and more tech savvy, and many would prefer, given the right circumstances, to complete their interaction with your company through direct system interaction. Systems should seamlessly support this preference. Too often, however, corporate executives view self-service as a means of reducing cost as opposed to providing an enhanced customer experience. It is important to understand that there are still, on average, more customers who prefer human interaction for key touchpoints in their customer journey, whether it is a purchasing process, service requirement or billing issue. Many are still not technically competent to manage the transaction themselves or prefer to make immediate contact with a knowledgable human to ensure that their requirement is completed to their satisfaction as quickly as possible. Additionally, there are complex situations that require human assistance, regardless of the sophistication of the customer or the company s systems. Placing too many hurdles between the customer and that human contact leads to dissatisfaction. Why is it that the interactive voice response (IVR) never seems to be programmed with the questions customers need answered? Why can t they just speak to a human without having to answer 50 questions that are not relevant to their issues? It is important to understand that there are still, on average, more customers who prefer human interaction for key touchpoints in their customer journey. Outstanding customer experiences are built on providing a complete set of access capabilities for customers that deliver the results they need, whether it is a web portal, , chat session, a voice call to a knowledgable resource in a contact center or a combination of some or all of these the customer should never leave frustrated. Do You Listen to the Voice of the Customer? Voice of the Customer (VOC) has become a wellused tagline by many software vendors. The intent of VOC is to establish a mechanism for collecting the feedback the company receives from its customers through any and all input methodologies, including data collection and voice recording in the call center, customer

7 7 surveys and, the hot topic du jour, social media. This data collection can establish the connection of CEM to Big Data because the volumes of data involved in monitoring social media leads to some very significant data management issues. The intent of VOC is to establish a mechanism for collecting the feedback the company receives from its customers through any and all input methodologies. Do you need to incorporate social media data analysis into your VOC program? The answer is it depends. That is not to say there is no value in doing so, but the cost involved in implementing the data management systems, and supporting the sophisticated analyses required, may not provide a satisfactory ROI for all but those companies that are heavily invested in social media. As such, most companies have not yet incorporated social media in their Big Data initiatives. It is much more important that you utilize CEM metrics and data collection that provide actionable data. Now ask yourself these questions: How many hotel survey cards have you completed? What about the retail store receipt surveys, even though they offer a chance to win something? And what do you feel is the probability that the company conducting the survey actually does something with the comments you make on the form? Have you ever received any response from a company to whom you have submitted a negative comment, providing detail as to how they are making a change in order to address the problem you identified? One metric that has gained widespread acceptance is Net Promoter Score or NPS, developed by Fred Reichheld at Bain & Company. NPS is based on the question How likely are you to recommend our company/product to a friend or colleague? The responses range from 0-10 with 10 the Most Likely and 0 the Least Likely. NPS segregates the responses. CEM Metrics There are many means for collecting and measuring customer feedback. Customer Satisfaction (CSAT) metrics collected in surveys conducted via phone, mail, or web site have been around for a long time and still serve a purpose. These can be conducted in-house or contracted to an impartial third party organization to conduct. The problem with CSAT surveys is that they have a tendency to be tedious and overused, which typically results in very low rates of response from the customers. Information source: Satmetrix *** Figure 3 - NPS Feedback In Figure 3, responses were broken out into Promoters (a score of 9 or 10), Passives (scores of 7 or 8) and Detractors (a score of 0 to 6). All responses are then tabulated and a score is established for the company by determining the percentage of responses that are Promoters (9-10) minus the percentage that are Detractors

8 8 (0-6). The key to NPS is that it tends to yield a high response rate due to the simplicity of the survey. However, it is often overlooked that NPS is designed to be a closed loop system. The survey should be taken at the transaction level. Rapid follow-up with the individual customer as required, especially with a Detractor, will demonstrate the company s commitment to listening to, and acting on, customer feedback. The scores and comments are reviewed by management and shared with the employees for recognition and coaching as well as using relevant feedback to continuously improve systems and processes. This process has proven that it can turn a Detractor into a Promoter, increasing wallet share and referrals. Rapid follow-up with the individual customer as required, especially a Detractor, will demonstrate the company s commitment to listening to, and acting on, customer feedback. A newer metric that has gained attention is the Customer Effort Score which was first promoted in 2008 by the US Corporate Executive Board. This metric is used to determine how easy it is to do business with a company, based on the theory that companies who are easy to deal with will have high levels of customer loyalty. An added benefit of CE as a metric is its use to assess ease of use of specific features of CEM such as a call center IVR or web portal. Proponents of the Customer Effort Score believe that it provides a more accurate reflection of the company s customer experience. There are staunch advocates of each of the CEM metric methodologies. There are obviously strengths and weaknesses to each. It may make sense to use a combination of two or more methodologies. The keys to selecting and implementing the various types of CEM metrics are: 1. Make it strategic: Customer Satisfaction or NPS measured by an outside firm on an annual basis at the strategic level will demonstrate the progress being made toward your goals through tactical initiatives. Don t set just a near term objective, because, once achieved, the temptation will exist to shift resources elsewhere. Reducing investment in CEM will jeopardize the program, possibly before ROI for the program has begun to accrue. 2. Make it tactical: Depending only on a high level survey simply gauging overall customer sentiment is ineffective. CSAT, NPS and CE can be transaction driven, because they capture the customer sentiment at an individual touch point level. Specific feedback received provides sufficient detail to address a human, system or process issue. 3. Make it actionable: Customer feedback, however it is obtained, needs to be used to address employee, policy, procedure or system issues that have a negative impact on the customer experience. Line management can use specific feedback from a customer to coach an employee if the feedback is negative, or provide recognition if the feedback is positive. Immediate feedback reinforces positive employee behavior and builds employee engagement. Negative transactional customer feedback is not typically an employee performance issue. More often, corporate policies and procedures or systems get in the way of a seamless customer experience. It then becomes necessary to change the policy or procedure or upgrade the system. Most importantly, customers need to be told that the changes were made based on their input. Closing the loop in that fashion demonstrates to customers that the company listens and values their input.

9 9 Refocusing Internal Metrics How often do we hear of contact center employees being measured on call volume, requiring them to focus on getting customers off the phone quickly, not on ensuring that customers issues have been resolved to their satisfaction on the first call? Customer-facing employees should be measured on their ability to satisfy their customers. This should include formal performance and advancement metrics, not just recognition programs. Managers at all levels in the organization should also have performance objectives tied to customer satisfaction. No one should be exempt. Customer-facing employees should be measured on their ability to satisfy their customers. Training & Communication As with any Change Management initiative, employee training and constant communication are critical to the success of a CEM program. Most employees are inherently capable of providing excellent customer service, but are frequently prevented from doing so by restrictive policies and procedures or by not being provided the training and tools required to do so. One of the most important elements of a successful CEM program is the engaged employee. Cultivation of employee engagement requires a cultural shift. Employees must be trained on dealing with customers in both positive and adversarial conditions. Managers need to be trained in leadership and in developing a workplace that fosters innovation in enhancing the customer experience. Communicate, communicate, communicate. CEM is a major organizational change. Every aspect of the program should be communicated at all levels using all available methodologies. Newsletters, webinars and campaigns from the CEO on down will help employees understand that this change is critical to the future success of the company. CEM is a major organizational change. Every aspect of the program should be communicated at all levels using all available methodologies. Employee Experience Another key element in the implementation of a successful Customer Experience program is the establishment of an employee engagement program for customer-facing employees. The hiring, training and ongoing involvement of these employees is a cornerstone of the implementation of a CEM program. Employees that are not engaged will have a negative and lasting impact on the customer experience. Internal metrics, as mentioned earlier, need to be revised away from a focus on productivity towards an external focus on the customer. To this end, many companies have implemented an Employee Net Promoter system to obtain employee feedback. Multichannel Customer Experience Developing a seamless customer experience requires a significant coordinated effort across many functional areas and is underpinned by a sophisticated data systems architecture. The same look and feel must exist for any customer access portal, be it web or mobile device support. The portal should provide customers a personalized, easy to use experience regardless of the actions they are performing: Do current customers have ready access to all of their data, including products or services

10 10 they have purchased, as well as access to live or virtual agents to resolve purchase, billing or support issues? Are prospective customers provided ready access to the information required to understand the benefits of the company s products and services and, where required, to make purchasing decisions or inquiries via another channel such as web chat or voice connectivity? This level of functional organization and systems integration is necessary for companies to remain competitive in many industries today. Process and system gaps that leave customers or prospective customers in limbo are no longer acceptable. Customers today are sophisticated, understand they have choices, and are more willing than ever to switch to a competitor that provides them the experience they are looking for. It is no longer just a question of a product feature set, service capability or price. Process and system gaps that leave customers or prospective customers in limbo are no longer acceptable. Why Are Many CEM Programs Doomed to Fail? Many executives will get on the CEM bandwagon because it is a hot topic, not because it is the right thing to do. They will then forget the value equation which demonstrates it is less expensive to retain a customer than to find a new one. They will see it as an initiative that, once fixed, is no longer required. They will lose patience with the long term focus required to achieve significant ROI, and begin to see the CEM program as a nonrevenue producing drag that is draining capital that could be more effectively applied to a new product or service, forgetting that the best source of customers for that new product or service will be those in the existing customer base. Finally, the implementation of a Customer Experience program is a major organizational change management initiative that requires a long term strategic view. If the company maintains a short term focus and is not committed to the organizational change required, the program will not succeed. The best source of customers for that new product or service will be those in the existing customer base. Summary A Customer Experience Management program is no longer a nice-to-have, but an integral strategic initiative that is required of most companies if they want to compete effectively in today s hypercompetitive business environment. CEM must be viewed as a permanent enhancement to a company s operations. CEM needs executive support if it is to achieve success. As long as corporate leadership views the primary goal of CEM as cost reduction rather than enhancement of the customer experience, the program will be doomed to failure and relegated to the pile of previously unsuccessful corporate initiatives. Conversely, commitment to CEM will enable the company to differentiate itself from the competition and position itself to become a market leader. Long term the reduction in customer churn, the incremental spend by customers and the increased customer base cultivated through referrals will provide a significant ROI on the CEM program. The facts speak for themselves. Successful companies value customers as assets instead of viewing them as liabilities.

11 11 Commitment to CEM will enable the company to differentiate itself from the competition and position itself to become a market leader. Vertek Can Help Vertek Customer Experience Management solutions, with a focus on operations, will ensure that you are optimizing each customer touch point by having the right internal processes and systems in place. You will gain visibility into trends impacting churn and will be provided models built to track high risk customers. With Vertek CEM, you ll ensure brand alignment and customer experience optimization, increasing lifetime customer value. Vertek can provide assistance in many areas of CEM program implementation, as shown in Figure 4. Source: Vertek Corporation **** Figure 4 - Vertek CEM Areas of Focus * Figure 1, was created by Vertek based on sourced information from Gartner, Inc. (or Satmetrix) ** Figure 2, Information Source: TeleManagement Forum 2013, Customer Experience Management Solution Suite 1.5GB962 Addendum C - October 2013 *** Figure 3, was created by Vertek based on sourced information from Satmetrix **** Figure 4, was created by Vertek Corporation

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