The counterintuitive nature of customer experience management


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The counterintuitive nature of customer experience management

  1. 1. The Counterintuitive Nature of Customer Experience Ct E i Qaalfa Dibeehi Vice President, Consulting & Thought Leadership Vi P id C li Th hL d hi © Beyond Philosophy ™ 2001-2009
  2. 2. The Beyond Philosophy Perspective Leaders at helping organisations define & build emotionally engaging customer experiences Global projects: Strategic Partners in Emotional side Asia and Europe of Customer Experience Beyond Philosophy Phil h Offices in London, England & Atlanta, Georgia Links with Academia © Beyond Philosophy ™ 2001-2009 1
  3. 3. We work with some great organisations… …improving their customer experiences © Beyond Philosophy ™ 2001-2009 2 2
  4. 4. How we add value… Customer Experience Management is a relatively new area of organization development. We help companies answer and action tough questions like: What is the future of our competition? What do our customers expect of us? How much is my current Customer Experience costing me? What is the Customer Experience we are trying to deliver? How deliberate is our Customer Experience? What emotions are we trying to evoke in our Customer Experience? Are our senior executives engaged in the Customer Experience? How can we ensure our people understand the l d dh importance of the Customer Experience to our organization and become motivated to change their be a ou s t e behaviours? © Beyond Philosophy ™ 2001-2009 3
  5. 5. Hand Poll Strongly Strongly disagree g agree g The following provide an entirely appropriate Customer Experience for their customers customers… Disney McDonald’s ld’ Your police force p Your company © Beyond Philosophy ™ 2001-2009 4
  6. 6. What is Customer Experience? Customer Experience is NOT about doing whatever it takes to h k “wow” customers © Beyond Philosophy ™ 2001-2009 5 5
  7. 7. Customer Experience definition A Customer Experience is an interaction between an organization and a Customer. It is a blend of an organizations physical performance, the senses stimulated and emotions evoked evoked, each intuitively measured against Customer Expectations across all moments of co tact contact. © Beyond Philosophy ™ 2001-2009 6 6
  8. 8. Experience and Opportunity Gaps p pp y p Current Customer Expectations Experience Gap Current Customer Experience Opportunity Gap Deliberate Customer Experience Company specific customer experience including process and relationship aspects © Beyond Philosophy ™ 2001-2009 7
  9. 9. Yorkshire Water Improved overall Customer Experience from 53%-91%. Kevin Whiteman, MD, “although you start with the mantra that this is going to cost you more, the reality is the opposite - the evidence is that it will save you money”. £ 8.5m ($15.5m) as a direct result of operational improvements such as: – Reduction in written complaints by 40%; a significant reduction i repeat calls with a sharp i ifi d i in ll ih h increase in first call resolution; reduction in Operational calls by 20% due to infrastructure improvements, system implementation & new procedures – l d d leading to a reduction of 50% of d f f unnecessary jobs Employee total “buy-in” to the CE through training “The Kelda Group has The sessions (with average event score of 3.7 out of 4.0). turned itself from one of the most ridiculed water Kevin: I’m absolutely convinced it has an effect on the companies in the 1990’s, share price. The stock market is like anything else, it into one of the most respected. respected It is now the reality. works on perception as well as reality If every bit of second best performing news they get is about a transformed company, company in terms of service about our growing reputation of being an efficient levels and has developed a company that delivers a good Customer Experience… record for steady financial performance. performance ” Financial Times © Beyond Philosophy ™ 2001-2009 8
  10. 10. Why clients want to improve the Customer Experience Experience… Regional utility provider – 20% increase in Customer Satisfaction and 25% reduction in call volumes Regional utility provider – Improve public and industry image, e.g., winner of the 2003 Utility Industry Achievement Award for Customer Care International FMCG / retailer – 1% increase in Customer Satisfaction driving a 1.3% increase in revenues Global multi-service telco – 36% improvement in Customer Satisfaction, 17% costs reduction and 200% increase in customer- facing time European insurance provider – 80% reduction in transaction costs Global PC manufacturer – 79% improvement in “Missing, Wrong & Damaged” deliveries resulting in reduced back office headcount p International wireless telecoms provider - 82% of Customer Interactions “better than last time” helped by a 4% increase in first call resolution Canadian Bank – Losing 26% of high value customers. Saved 6% of high value Customers – value CDN $ 85m © Beyond Philosophy ™ 2001-2009 9
  11. 11. A straight forward Customer – “Hi, I saw your ad in the paper advertisement… call us, and wanted more info” info we can– help you mayreferring to”code you better your Ultralase “Certainly, I have the number of the ad are vision © Beyond Philosophy ™ 2001-2009 10
  12. 12. © Beyond Philosophy ™ 2001-2009 11
  13. 13. The Customer Experience is both Rational and Emotional • Rationally satisfied customers behave Rational (Conscious) Experience the th same as dissatisfied customers. • Emotionally satisfied customers Product Price contribute far more to the bottom line Promotion Placement than rationally satisfied customers. customers © Beyond Philosophy ™ 2001-2009 12
  14. 14. At least 50% of the Customer Experience is based on the emotional engagement • Rationally satisfied customers behave Rational (Conscious) Experience the same as dissatisfied customers. • Emotionally satisfied customers ti fi d t contribute far more to the bottom line than rationally satisfied Emotional (Subconscious) Experience customers. © Beyond Philosophy ™ 2001-2009 13
  15. 15. Best Practice: Customer metrics Rational (Conscious) Experience Customer Satisfaction Net Promoter does not tell you what to h Emotional Rational Experience do about it Signature (Conscious experience) Emotional (Subconscious) Experience © Beyond Philosophy ™ 2001-2009 14
  16. 16. Net Promoter Score Postbank NL (15%) Commerce Bank USA (67%) Australian banks avg -35% (only 1 positive) © Beyond Philosophy ™ 2001-2009 15
  17. 17. The link to value © Beyond Philosophy ™ 2001-2009 16
  18. 18. Emotional Profile © Beyond Philosophy ™ 2001-2009 17
  19. 19. The Sainsbury’s Story | Action A little background: • Britain's longest-standing major food retailing chain. • Employs over 145,000 people. • Offers over 23,000 products. • Serves over 11 million customers/week in its 500+ stores throughout the UK. / g Before After • In the late 1980s, the Chairman was • The Chairman was replaced by an p y a outward looking marketer. inward looking accountant. • The worst thing a store manager • The worst thing a store manager could do was: could do was: 1. be 1 b out of stock f k 1. be 1 b overstocked kd 2. be overstocked 2. be out of stock What do you think was the effect of this change? © Beyond Philosophy ™ 2001-2009 18 18
  20. 20. The Sainsbury’s Story | Reaction Slight Shift – Huge Impact Shift in Priority Initially a boost in stock price but then a decline Revenue A drop in revenue that lagged behind the decrease in cost Cost Stock price Decline Initial boost Time Before After • Supermarkets main value added is that • How do accountants measure the they offer the goods you want in one impact of frustrated customers? place. • They don’t because it’s not ‘hard’ • The shift in priority caused managers to data (i.e. it is not in the past) (i e prefer to be out of stock to being • What happens if customers continue overstocked not to find what they are looking for? • The priority changed because the costs • By the time Sainsbury’s recognised y y g of an overstock i easily measured. f k is il d the problem, customer attrition had • Service levels declined from 99% gained its own momentum! average to below 90%. © Beyond Philosophy ™ 2001-2009 19 19
  21. 21. Which of these profiles do you think represents Sainsbury’s after the change? 2 1 Naive Ni Transactional T ti l 3 4 Enlightened Natural © Beyond Philosophy ™ 2001-2009 20
  22. 22. The Journey from Naïve to Natural 0% 32% 60% 8% © Beyond Philosophy ™ 2001-2009 21 21
  23. 23. N2N Strategic Assessment – Report Samples © Beyond Philosophy ™ 2001-2009 22
  24. 24. N2N Strategic Assessment – Report Samples SYSTEMS Best Performer Company “XXX” Index Average Lowest Performer © Beyond Philosophy ™ 2001-2009 23
  25. 25. How a few organisations might fare… © Beyond Philosophy ™ 2001-2009 24
  26. 26. The goal of the customer experience… The point is to blah, blah .. Blah, deliver blah….. a deliberate customer experience consistently • Deliberate not accidental • Consistent not lucky/ unlucky • Emotional not transactional © Beyond Philosophy ™ 2001-2009 25
  27. 27. The Counterintuitive Nature of Customer Experience Ct E i Qaalfa Dibeehi Vice President, Consulting & Thought Leadership Vi P id C li Th hL d hi Thank you © Beyond Philosophy ™ 2001-2009