The state of customer experience (CX) is languishing because companies are making seven critical CX transformation mistakes.
At the 2018 Customer Intelligence Summit, Forrester Principal CX Analyst Rick Parrish laid out these common errors but said it’s easy to sidestep these problems if you know what to look for. His keynote, “Get Your CX Transformation Right the First Time,” emphasized the need for a systematic, enterprise-wide approach that avoids the seductive shortcuts and hidden pitfalls that are causing many brands to fail at CX.
Parrish said it's important to remember the process of creating and evolving the customer experience is never-ending. “Your CX always needs to be evolving to match new customer expectations.”
Start by defining CX
CX is not a new buzzword for customer service. There are many important ways in which CX is the opposite of customer service, said Parrish.
The old style of customer service thinking tends to be very organization centric—it’s telling the customer what it means to them and what it’s doing for them, but the CX field looks at things from the outside-in—the customer's perspective. “You don't get to argue with that. Their perception is the reality of their experience.”
Second, the traditional customer service model only looks at two tiny slices of the overall relationship—the point of sale (or service) and then the support. CX is the entire customer journey.
Finally, said Parrish, customer service thinking tends to look at creating good experiences for customers as an expensive, necessary evil. “We got to do something for them, so let's do as little as we possibly can because it's costing us money.” However, the CX field understands that providing a great experience is a force multiplier and makes everything else work better, he said, and companies that focus on the quality of CX operate more efficiently and more smoothly. “It's cheaper to provide a good experience than it is to provide a bad one.”
Avoid the 7 sins of bad CX transformation
Even though it might cost less to deliver a good experience, the state of CX is languishing across industries. In fact, for the third year in a row, CX quality is weak and stagnant with no true CX leaders.
Parrish said many companies think they’re far down the path to CX transformation. Instead, they’re falling prey to ideas that seem good but lead their CX transformation efforts astray by making seven common mistakes.
1. Forgetting customers are people: Parrish said many companies go from testing products and services to interaction design but skip an important step in between—real customer understanding. “You've got to do that first before you do user testing.” Otherwise, you end up with interactions that work well that nobody wants.
2. Only greasing the squeaky wheel: Many companies focus on customers making a complaint, said Parrish, when it turns out the biggest complainers are customers with the lowest lifetime value to the brand. HSBC Canada discovered through their contact centers that customers with higher lifetime value aren’t necessarily happier. “It's just that they weren't complaining about it as much,” he said.
3. Designing CX for ease, not emotion: Making CX fast, simple and efficient while reducing customer effort are all good things, but emotion is often considered as an afterthought, said Parrish. However, big box retailer Home Depot understands a purchase can be complex and laden with emotion. Its digital properties have seen massive growth year over year because it’s primarily worried about designing for emotion, not just speed and efficiency.
4. Over-reliance on employee autonomy: Many companies rely on their employees’ common sense to deliver the right experience because they work hard to hire the best people and give them the most customer centric training, said Parrish. While this can create engaged, excited employees who provide authentic and meaningful interactions, it can backfire if they are no boundaries because CX varies widely depending on which employee the customer interacts with.
5. Reliance on dashboards and reports: Companies assume all employees will get as excited about customer insight equally but forget that the point of pushing out the voice of the customer, dashboards and reports isn't to inform employees about the data, said Parrish, it's to drive employee behaviors.
6. A reorganization will create a customer-centric culture: Many companies realize they are organized around internal priorities and traditional process efficiencies—product instead of experience. They decide the only way to become customer-centric is start with a blank slate. Although this would appear to make sense, Parrish said company revenue tends to drop for a few years after a reorganization as does CX because everybody's trying to figure out the new organization. “The experience suffers because they become very inward looking.”
7. Compensating employees for CX quality: It’s a controversial idea, said Parrish, but the main problem with compensating employees based on a CX metric is that they end up gaming the system. Research backs this up, he said, and no amount of retuning can prevent it. Forrester’s research shows financial incentives are one of the least effective ways to engage and motivate employees. Non-financial peer-to-peer recognition is more motivating and costs very little.
Those seven mistakes alone are a lot to unpack, Parrish acknowledges, but there are some simple remedies companies can apply today that deliver incremental gains toward becoming truly customer-centric.
Make CX a daily habit
Real CX transformation doesn’t happen overnight or by accident. They’re systematic.
Parrish said a good starting point is to model customer-centric behavior in your own work every day. “Don't worry about a big organizational transformation. Just do your own job differently from where you already are.” One way is to mirror what one retirement home did, he said. Rather than talk about the profit and loss numbers in management, attendees were tasked with providing examples of a unique or unexpected customer problem they encountered and how it was solved. The goal was to see if the solution could become standard operating procedure or develop another that would improve CX.
Second, be sure to recognize all employees for their contributions to great CX, even those who don’t interact with customers, said Parrish, ideally with a handwritten note rather than an email. “Even behind the scenes, employees do things that trickle outward to affect the quality of the experience.”
Finally, he said, whenever you make a decision, whether it’s a big strategic one or a tiny one, ask yourself how the decision affects the customer experience. “Just ask yourself that question. Ask colleagues that question before they make a decision. They'll start asking their colleagues.” By doing this, said Parrish, you've brought the customer into the room every time a decision gets made.
Good CX is more than the sum of its parts
Companies get into trouble with their CX transformation efforts when they rely too much on technology, automation, and large-scale reorganizations. Parrish said good CX boils down to the three Es—effectiveness, ease and emotion. “Unless an experience fulfills all three of these, customers are not going to say it's great.”