So You Want To Keep Your Customers? Heres How BPM Can Help Customer Experience can be defined as sum of all interactions and experiences that a customer has with a company, writes contributor Rohan Bhattacharjee. Want to improve your customers’ experience with your company? Here’s how “value-based” BPM can help. FREE White Paper: http://tiny.cc/7agubwCustomers are always interacting with your organization - and not only during the actual‘buying’ process. They are interacting with your company when they visit your website,for instance, call your telephone helplines(contact center), visit one of your retail outlets,use a self-service kiosk, use your product, respond to your email promotions – and thelist can go on. Each one of these interactions are “moments of truth” where a customerforms their perceptions about your company, your business practices, service quality,etc.Customer Experience can be defined as sum of all these interactions and experiencesthat a customer has throughout their “relationship” with a company. Each of thoseinteractions is critical because they define how a customer perceives their interactionswith a company and that ‘perception’ will determine how long a customer stays with anexisting provider / supplier.So if you want to keep your existing customers and attract new ones, it pays to improvethe customer experience. Here are some of the key challenges faced by companies(including Retail, Telecom, Financial Services, and Energy):Active Customer Experience ManagementActive Customer Experience Management refers to the method of proactively managingthe customer experience by identifying the most important business processes in acustomer life cycle, developing alerts against most important events and then creating an
action plan for pro-active and re-active contact with the customer. This helps inmanaging the customer facing business processes effectively, thus leading to improvedoverall customer experience.The below figure shows the key elements of Active Customer Experience Management:Step 1: Identify the Customer Lifecycle StageThe customer lifecycle consists of several stages right from the first time the customer isreached as a lead till the time he stops being a customer anymore. It may also be thecase that the customer never leaves the company and instead becomes a strongadvocate of the products and services, thus helping to bring in more customers. Thetypical customer life cycle stages are - Reach, Acquire, Develop, Retain, and Inspire. It isextremely useful to be able to classify and group customers into each of these stages asthe needs and expectations of the customers are very different at each stage. Thus, thecustomer facing business processes that are deemed to be most important by customersalso vary depending on which stage of the lifecycle they are in.Step 2: Determine the Customer Facing Business ProcessesCustomer Facing Business Processes are essentially those processes that may or maynot require a direct contact with the customer, but the customer is definitely impacted bythese processes. These processes are bound to vary for different industries and in turnfor different companies. They include the building of a single view of the customer acrossall contact channels and the distribution of customer intelligence to all customer-facingfunctions like Sales, Marketing, and Customer Service.Business Process Management can help in developing a systematic structure to managecustomer relationship initiation, maintenance, and termination; across all customercontact points to maximize the value of the relationship portfolio.The figure shows a sample structure for Customer Facing Business Processes:
BPM can help identify the most critical customer facing business processes for anorganization by careful analysis of the industry, company and customer segments.Depending on the Customer Life Cycle stage, the criticality and importance of thebusiness processes are bound to vary.Step 3: Identify Key Events for Customer Facing ProcessesThe critical customer facing business processes are analyzed to identify the key eventsthat affect the customer. Active Customer Experience Management provides the abilityto use customer insights, to proactively relate to an organization’s targeted customersegments, as well as provide advice and assistance around a number of key events, thatcan influence the customer’s experience and opinion about the organization, in thecustomer’s lifecycle.Events can be classified in two major categories: Events for proactive contact (Retention,Up/Cross-Sell, Risk Mitigation), and Events for reactive contact (Service Recovery,Growth)BPM takes the lead in providing the insight into these critical customer processes thatallows a company to turn potentially difficult events in a customer’s lifecycle into apositive customer experiences. Identifying the key events and charting out an action planare the key to improving the customer experience.
For instance, a large Australian Energy and Utilities retailer utilized BPM to gathercustomer insights to manage some key events in their customer facing processes. Theyfound out that about 80% of their customers shifted to a different service provider at theend of their lease period. As part of their account management process, they gathereddata from all existing and new customers pertaining to their lease agreement. Theyconfigured a ‘Transfer Out’ event alert, so that a message from the distributor telling thecompany that a "transfer" out is due for the customer, acts as a trigger to pro-activelycontact the customer that is moving out, in order to retain them as a customer in theirfuture address.Step 4: Configure and Manage AlertsAlerts need to be developed for all the key events to help identify that an event has takenplace. Alerts also help to identify and take appropriate action associated with thatparticular event in the customer life cycle. Each ‘alert’ needs to have a fewcharacteristics as detailed below: Alert Characteristic Definition This is the source of the alert. It could either be a data source Source generated from system, or it could also be a process source as identified from a process An alert is generated for proactive contact when a tolerance Threshold level is broken. This tolerance level would be the threshold Every alert can have an allocated impact with respect to the customer experience category it’s trying to influence. They Impact could be Retention and Service Delivery, Risk Mitigation, or Growth Customer Life Cycle stage and associated Customer Customer Type Segment would help identify the type of pro-active action to be taken Every alert will have a priority assigned to get actioned out, Priority along with a validity period for the same Every alert would have a possible list of activities that a company would carry out. These would be in co-relation to Possible Action the impact of the alert and to the customer life cycle stage as well as a customer segment taggingStep 5: Develop A Customer Action PlanA detailed action plan needs to be developed against each ‘alert’ identified for improvingthe customer experience. With the help of active business rules as specified in BPM,these actions can be configured so that they are initiated as and when an alert istriggered.
As there is a substantial cost associated with Active Customer Experience Management,it is important to avoid the risk of ‘over-serve’ to low potential customers and ‘under-serve’ to high valued customers.Considerations while developing the Customer Action Plan are:• Type of Customer• Stage in customer life cycle• Customer segmentBased on the above, organizations can decide on their action plan with typically 3 levelsof service categories as described below:Business BenefitsTypical business benefits include:Active Customer Experience Management driven by BPM can have direct impact on thecustomer lifetime value, thus impacting both the top line and bottom line of anyorganization.
About the Author Rohan Bhattacharjee Rohan Bhattacharjee works for a major consultancy in the Business Process Management-Lifecycle (BPM-L) Practice, based in Asia-Pacific. He has extensive experience in Global Business Transformation, Business Process Re-engineering Improvement, BPM Strategy, Business Process Framework (e-TOM, SCOR) implementation, Balanced Scorecard Development, Customer Experience Management,and Change Management. He has led and executed engagements for a wide range ofindustries including Telecom, Energy & Utilities, Airline, Public Services, Hi-Tech andManufacturing; across multiple geographies including US, UK, Europe, India, andAustralia.Rohan is a Certified PRINCE 2 Practitioner, Certified Process Professional, and also hascertifications in e-TOM Business Process Framework and Statistical Process Control. Heholds both an MBA-International Business and a Bachelor of Technology degree.About PEX Network I invite you to join as a member of the PEX Network Group http://tinyurl.com/3hwakem, you will have access to Key Leaders Globally, Events, Webinars, Presentations, Articles, Case Studies, Blog Discussions, White Papers, and Tools and Templates. To access this free content please take 2 minutes for a 1 time FREE registration at http://tiny.cc/tpkd0PEX Network, a division of IQPC, facilitates access to a wealth of relevant content forProcess Excellence, Lean, and Six Sigma practitioners. Further enhanced with an onlinecommunity of your peers, we will provide you with the tools and resources to help youperform more effective and efficiently, while enhancing the quality operations within yourorganization. As our industry becomes more and more dependent on the Web forinformation, PEXNetwork.com has been developed to provide Six Sigma professionalswith instant access to information. Leveraging our strength and foundation in education,IQPC and the Process Excellence Network are uniquely positioned to provide acomprehensive library of webcasts gathered from our events, as well as exclusivecontent from leaders in the industry.