A well executed customer experience program will bring value. Seeing this value isn't always intuitive. Join McKinsey & Company consultants, Alex Rawson and Joel Maynes as they show how to link value to customer experience to deliver stacked wins.

1. Linking the
Customer
Experience to
Value
Joel Maynes and Alex Rawson
McKinsey & Company

2. 2
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Housekeeping
©2015QUALTRICSLLC.

3. Joel Maynes
Associate Principal, McKinsey & Company
8+ Years of experience with McKinsey &
company’s Los Angeles office
Leader of McKinsey’s Customer
Personalization Practice
Expertise in “What Matters” customer
experience analytics & personalization
Alex Rawson
Principal, McKinsey & Company
11+ Years of experience with McKinsey &
company’s Seattle office
Leader of McKinsey’s Customer Experience
Practice
Expertise in broad Customer Experience &
Front Line performance transformations
Introductions

4. 4
With a strong link to value, tackling Customer
Experience can deliver stacked wins
©2015QUALTRICSLLC.
LOWER COST TO SERVE
15 to 20%
FUEL REVENUE GROWTH
Churn, upsell, repurchase
10 to 15%
IMPROVE CUSTOMER SATISFACTION
20%
ENGAGE EMPLOYEES
20 to 30%

5. 5
Getting the math right requires a structured &
scientific approach to achieve three objectives
©2015QUALTRICSLLC.
Build an explicit link to value1
Direct investments to where they will
do the most good
2
Design a road map with early successes
to self-fund improvements
3

6. 6
Clarify what CE is actually worth and exactly
how improvements will generate value
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Reduce Cost
to Serve
Reduce
Churn Risk
Increase
Referrals
$144$160$180
8.0%
10.9%
16.4%
0.15%
0.12%
0.10%
Referrals
customer, %
Annual Churn
Rate, %
Annual Care
Cost, $
Business outcomes by Satisfaction Score
$>300M
Value of a 10
point CE
improvement?
$100-200M
$50-100M
Example value levers
“Neutrals”
(7 to 8 score)
“Promoters”
(9 to 10 score)
“Detractors”
(0 to 6 score)

7. 7
Customer-experience break points are not
standard across industries
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0
10
20
30
40
50
60
70
80
90
100
0 1 2 3 4 5 6 7 8 9 10
Likelihood of business outcomes1
Willingness to recommend
(WTR)
NPS breakpointsBanking Pay TV Health insurance
Retail banking:
every point matters,
moving someone
from a 9 to 10 is
meaningful
Health insurance: driving detractors to
passives has more impact; moving passives
to promoters has little impact
Pay TV: passives are 5
and 6, not the typical 7
and 8

8. 8
End-to-end customer journeys, not individual
touchpoints, are the unit to measure
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Customer satisfaction
Willingness to Recommend
0.43 +36%
0.58
0.47 +28%
0.60
0.50 +19%
0.59
-0.25
-0.33
+33%
Likelihood to stay/renew
Likelihood to cancel/churn
Touchpoints
Journeys

9. 9
Build a model of customer satisfaction that links
perceived and operational data on each journey
Johnson Relative Weights Driver Model
FunctionalService
Product
&Price
Emotion/
Brand
100100% =
Driven by Quant research linked to data
▪ Start by rethinking the scope of existing
surveys
▪ Expand your customer data set so that it links
up with operational data, as well as input
from employees and customers
▪ Base priorities for initiatives and
opportunities on their importance to
customers
▪ Understand the sub drivers within the most
important journeys
▪ Focus on customer-experience issues with the
highest payouts
Example journeys:
▪ Bring me onboard
▪ Solve my problem
▪ Move my service
▪ Pay my bill
Example journeys:
▪ Price and value
▪ Programming & equipment

10. 10
Supplement the model by looking at how
consistently you perform on top journeys
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Customer onboarding journey – first 100 days
Resear-
ch offer-
ings
Explain
terms
and
condi-
tions
Confir-
mation
email
Instal-
lation
Consi-
der sign-
up
First bill Subse-
quent
bills
Assess
needs,
build
rapport
Deter-
mine
pack-age
Resolv-
ing
problem
Signup on website First 100 days
% Dis-
satisfied 40 30 4035 30 15 30 25 40
Felt
confused
by offer
Did not
receive
Agent did not help
customer find right
product
Difficult to
under-
stand
packages
Higher
than
expected
Confused
by
language
on bill
Dissatis-
fied with
schedul-
ing
Surprised
by repair
fees
Signup process
Pain
Points
Look For: What % of customers have a perfect end-to end experience
and how variable is it?

11. 11
Set priorities for addressing the journeys that
matter by sizing potential across three factors
©2015QUALTRICSLLC.
Early Lifecycle
Journeys
Problem
resolution
Journeys
Loyalty and
late-tenure
Journeys
Payment
Journeys
Areas Journey Examples
Customers
Impacted,
M
Improving
overall
satisfaction, pts
Capturing long-
term loyalty
potential, $M
Reducing
the cost to
serve, $M
0
0
1
3
1
2
1
2
1
1
5Bring me on-board 5
Word of Mouth & Referral journey 1
Video-on-Demand journey 12
Paying my bill journey 25
Getting my service reinstated 3
Getting my service working again 15
Coordinating an in-home visit 8
Get a better product experience
Moving to a new home 4
Cancelling my service early 2
Disconnecting my service 2 2
5
0
3
8
4
18
13
10
10
25
0
0
8
2
9
35
37
11
41
20
21

12. 12
Now you can construct a transformation road
map backed by a clear business case
©2015QUALTRICSLLC.
Ease of implementation
High
(2+pts
CE)
Low
(<1pt
CE)
Low High
Revenue&SatisfactionImpact
Assess investment
case or lower cost
Accelerate roll-out
Re-evaluate later Redesign for
increased impact
Med (1-
2pts CE)
3
5
8
16
13
1
10
15 11
9
7
4
17
2
12
14
6
Bring me onboard
Get My Service Working
Again
Get a better product
experience
Journeys:
Ease of implementation comprised of multiple factors: investment
required, management capacity, front line training
Impact
calculation
based on:
• # customers
impacted
• Derived
Satisfaction
Impact
• Demand for
personal-
izaiton
initiative
“What Matters” driven Customer Experience Roadmap

13. 13
Questions to ask to lock in the ROI on CE
©2015QUALTRICSLLC.
▪ Have you quantified your
CE Value Equation (e.g.,
linked customer
experience and outcomes
at customer level)?
▪ Do you have end-to-end
KPIs for your most
important journeys, or
just individual touchpoint
metrics?
▪ Do you have a formal
mechanism to run and
evaluate CE tests at scale
and book the impact with
finance?
▪ Have you hardwired CE
team resource requests to
use low cost process,
policy, and OpEx levers
before turning to IT?
▪ What is your shortlist of 1-
2 customer journeys that
have the most economic
potential?
▪ Do you have a forcing
mechanism to solve
tradeoff decisions across
functions in order to
deliver on bolder CE
aspirations?
Upfront On-GoingBoth

14. Q&A

15. THANK YOU