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Making CEM a Reality JBoye 2014 Philadelphia| 06 May 2014 Tim Walters, Ph.D. | Partner, Principal Analyst twitter: tim_walters [email protected] www.digitalclaritygroup.com
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Making customer experience management real by Tim Walters

Aug 23, 2014

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Page 1: Making customer experience management real by Tim Walters

Making CEM a Reality JBoye 2014 Philadelphia| 06 May 2014

Tim Walters, Ph.D. | Partner, Principal Analyst twitter: tim_walters [email protected] www.digitalclaritygroup.com

Page 2: Making customer experience management real by Tim Walters

2  

A strategic inflection point

Source:  Based  on  Andy  Grove,  Only  the  Paranoid  Survive,  1996   @>m_walters  

Page 3: Making customer experience management real by Tim Walters

Making #CEM real means: We’re all Grace Kelly

now.

3  

Twlusion #1

Page 4: Making customer experience management real by Tim Walters

“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

4  

Page 5: Making customer experience management real by Tim Walters

5  

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  

Page 6: Making customer experience management real by Tim Walters

6  

The “dissonance gap”

     

The business challenge is to correct course before the gap becomes too large to cross.

Page 7: Making customer experience management real by Tim Walters

Making #CEM real means: Navigating the

“dissonance gap.” Time is running out.

7  

Page 8: Making customer experience management real by Tim Walters

8  

“Ex>nc>on  is  the  rule.  Survival  is  the  excep>on.”                                    -­‐-­‐  Carl  Sagan  

Page 9: Making customer experience management real by Tim Walters

9  

What do consumers want from us?

@>m_walters  

Page 10: Making customer experience management real by Tim Walters

Twitter trumps condiments

10  Source:  hQp://www.newmediaandmarke>ng.com/brands-­‐have-­‐to-­‐master-­‐complaint-­‐management/customer-­‐complaints-­‐561  

Page 11: Making customer experience management real by Tim Walters

Only  

11  

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  

Page 12: Making customer experience management real by Tim Walters

12  

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  

Page 13: Making customer experience management real by Tim 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  

Page 14: Making customer experience management real by Tim Walters

14  

$1.25  million  per  year  

@>m_walters  Source:  hQp://www.weirdworldfacts.com/smart-­‐dogs-­‐with-­‐amazing-­‐jobs/  

Page 15: Making customer experience management real by Tim Walters

$89 billion “is lost by US retailers each year because of customer

defection or abandoned purchases due to poor experiences”

15  

IBM says . . .

Source:  www.mycustomer.com/feature/experience/jim-­‐glazer-­‐ibm-­‐store-­‐s>ll-­‐pivotal-­‐customer-­‐experience/165159  

Page 16: Making customer experience management real by Tim Walters

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  

Page 17: Making customer experience management real by Tim Walters

Making #CEM real means: Accepting that business

reality has changed. (And acting like it.)

17  

Page 18: Making customer experience management real by Tim Walters

#CEM isn’t the Next Big Thing. It is the Next Only

Thing. #provocation

18  

Page 19: Making customer experience management real by Tim Walters

“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.”

19  

The worst kind of hype?

Source:  hQp://customerthink.com/the_biggest_danger_to_cx_is_simply_this_hype/  

Page 20: Making customer experience management real by Tim Walters

20  

Consumers gain voice and choice

@>m_walters  

Page 21: Making customer experience management real by Tim 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  

Page 22: Making customer experience management real by Tim 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  

Page 23: Making customer experience management real by Tim 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  

Page 24: Making customer experience management real by Tim Walters

24  

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  

Page 25: Making customer experience management real by Tim 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  

Page 26: Making customer experience management real by Tim Walters

26  

Page 27: Making customer experience management real by Tim Walters

§  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”

27  

Answer: You suck

Source:  Accenture  Global  Consumer  Pulse  Report,  2014.  @>m_walters  

Page 28: Making customer experience management real by Tim Walters

28  

Can “CX” be “M”d?

Source:  hQp://www.bedeckhome.com/sloane-­‐towels-­‐2-­‐colours.html  

Page 29: Making customer experience management real by Tim Walters

§  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.

29  

Unpacking CX and CEM

@>m_walters  

Page 30: Making customer experience management real by Tim Walters

Making #CEM real means: Judging CEM tech and

practices from the customer’s (ad)vantage

point.

30  

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You can manage an experience, but not the

experience of the experience. #CEM #WTF?

31  

Sorry, but . . .

@>m_walters  

Page 32: Making customer experience management real by Tim Walters

32  

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  

Page 33: Making customer experience management real by Tim Walters

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.)

33  

Page 34: Making customer experience management real by Tim Walters

You can build Disneyworld, but you

can’t ensure the kid will have a good time there.

34  

That experience nonsense explained

Page 35: Making customer experience management real by Tim Walters

Customer insight + brand story = experience assets

Experience assets +

interaction = customer perception = CX

35  

Page 36: Making customer experience management real by Tim Walters

Making #CEM real means: Managing the delta

between your intent and the customer’s

perception.

36  

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37  

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/  

Page 38: Making customer experience management real by Tim Walters

38   @>m_walters  

Page 39: Making customer experience management real by Tim Walters

39  

The “dissonance gap”

     

Were these guys going to be saved by better marketing? Sales

force tools? Call center optimization?

Page 40: Making customer experience management real by Tim Walters

§  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)

40  

Engaged and empowered employees . . .

Page 41: Making customer experience management real by Tim Walters

41  

How are we doing with enterprise social and collaboration?

Page 42: Making customer experience management real by Tim Walters

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% !!!

42  

Answer: Local success, lots of hard work and enthusiasm, but, in the final instance, overall, You Suck!

@>m_walters  

Page 43: Making customer experience management real by Tim 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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44  

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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45  

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/  

Page 46: Making customer experience management real by Tim Walters

46  

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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47  

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/  

Page 48: Making customer experience management real by Tim Walters

Social business 2016?

48  

Page 49: Making customer experience management real by Tim Walters

Provides -  Support for digitalization/

automation of work -  Structure and accelerator for

business transformation

49  

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  

Page 50: Making customer experience management real by Tim Walters

Making #CEM real means: Effecting organizational transformation through

social driven by customer experience.

50  

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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

51  

Where to start?

@>m_walters  

Page 52: Making customer experience management real by Tim Walters

52  

Selected journeys (McKinsey)

Page 53: Making customer experience management real by Tim Walters

§  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  

Page 54: Making customer experience management real by Tim Walters

54  

“You may hate gravity, but gravity does not care.” -- Clayton Christensen

Page 55: Making customer experience management real by Tim Walters

Tim Walters | Partner, Principal Analyst

@tim_walters

[email protected]

www.digitalclaritygroup.com