© 2011 Beyond Philosophy 1
Customer Experience Management Management Implications Report
Global Customer Experience Management Survey 2011
Steven Walden Senior Head of Research and Consulting
Beyond Philosophy
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1360 Center Drive, Suite 110 Atlanta, Georgia 30338 USA T: +1 (770) 206-5280 F: +1 (770) 206-5289
www.beyondphilosophy.com
© 2011 Beyond Philosophy 2
Abstract Between May and July 2011, Beyond Philosophy undertook a comprehensive review of
the state of the global market for customer experience management (CEM). This was
based on a sample of 8,000 customer experience (CE) executives from 239 countries
and regions of the world, as well as in-depth interviews of 53 leading authorities on
customer experience from all continents.
A webinar outlining the results can be found at:
http://www.beyondphilosophy.com/thought-leadership/webinars/customer-
experience-strategies-innovation-and-best-practices-around-worl
Management Implications report
CEM is standing at the crossroads of success and failure. It has succeeded in spreading
globally as a term, but has been inadequately adopted beyond a few verticals. Further,
in most cases, adoption means adoption of the term, not the application. Indeed CEM is
under threat of collapse due to software vendors’ use of CEM as a rebrand for CRM in
order to sell more software, on the top of an ‘everything is important now’ mentality. This
approach has unfortunately diluted the inherent value and message of customer
experience.
Yet drivers to its success remain particularly with increasing customer empowerment.
For instance, in the high growth BRICKS and Middle East region, expectations are rising
through engagement with the ‘developed’ world, social media and the growth of middle
class incomes, as well as the increasing demands of the wealthy elite for international
brands.
What is required now is a clear recognition that customer experience is different, that it’s
not just a rebrand, but in fact a transformational business strategy different from
marketing or customer service.
© 2011 Beyond Philosophy 3
It is essentially:
1. An organizing principle tying together silos such as marketing and customer
service that are failing to keep up with customer demand in an increasingly
complex multi-channel environment.
2. A cultural mind-set, keeping a customer focus in the organization when it is under
threat of being lost under a data deluge.
3. A means to focus and embed positive psychology into the customer journey (i.e.,
not just focus on the 4 Ps of marketing or physical interactions, but the
psychology of the consumer, their emotional as well as rational response).
This report summarizes the implications for management from the findings of the Global
Customer Experience Research 2011. Faced with the rebranding of CRM, marketing,
customer service and other initiatives as CEM, Beyond Philosophy calls for a
fundamental rethink of how customer experience management is being applied in firms;
in particular, whether CEM is an organizational effort to get closer to clients and
customers, and whether emotions are a fundamental part of ‘the experiences’ those
firms evoke.
© 2011 Beyond Philosophy 4
Contents Abstract 2
Executive Summary 6
1.0 Methodology 9
1.1 Quantitative 9
1.2 Qualitative 9
1.3 Sample 10
2.0 Five Major Risks 13
2.1 Use of the Term as a Rebrand for Current Operations 13
2.2 Risk 2: Misappropriation of the Term for Vendor Sales 16
2.3 Risk 3: Failure to Take Account of the Customer’s Emotional Viewpoint
(e.g. in ROI)
18
2.4 Risk 4: Limitations in its Adoption 20
2.5 Risk 5: Timeframe to Execute 22
3.0 A Strategy to Manage Risk 24
4.0 Five Major Drivers 28
4.1 Major Driver 1: Increasing Need to Respond to Customer Empowerment 29
4.1.1 10 Customer Empowerment Drivers 29
4.2 Major Driver 2: Increasing Need to Manage Organizational Complexity 32
4.3 Major Driver 3: Increased Awareness on the Importance of Emotion and how this
Translates into Loyalty Gains
35
4.3.1 Translation of Emotion into Loyalty 38
4.4 Major Driver 4: Move from Product-Based to Service-Based Organizations 40
4.5 Major Driver 5: Web Experience 41
5.0 A Final View 43
Contacts 47
© 2011 Beyond Philosophy 5
Figures and Tables
Table 1: Distribution of the 53 in-depth interviews including by title 10
Table 2: Summary distribution of the 53 in-depth interviews by regional percentage 11
Figure 1: Distribution of the 53 in-depth interviews by sector 12
Figure 2: Distribution of 53 expert interviews by industry 12
Table 3: What is the one question you would like answered about CEM? 13
Table 4: Examples of how CEM is being used badly 15
Table 5: How emotion is measured 19
Figure 3: Key areas of a CE implementation 24
Figure 4: Processes need emotional grounding 26
Figure 5: Culture and governance before process 27
Figure 6: The need to demonstrate proof of concept 27
Table 6: Resolution of risks 28
Figure 7: The path to enlightenment 43
Figure 8: First and second generation enlightenment 44
Figure 9: Rejuvenation or die 45
Figure 10: Make sure you are fit for purpose 46
© 2011 Beyond Philosophy 6
Executive Summary
What are the Five Major Risks?
I. Risk 1: Use of the term as a rebrand for current operations - Customer experience is
a well-used term as demonstrated by the global spread of executives with CE in their
titles. However, there is a disparity between use of the term and the actual
implementation of a CE program.
II. Risk 2: Misappropriation of the term for vendor sales - Another risk is the active
misappropriation of the term ‘customer experience’ by some vendors as a front for
rebranding CRM as CEM in order to sell more solutions.
III. Risk 3: Failure to take account of the customer’s emotional viewpoint e.g., in ROI -
Customer experience tends to follow a touch point definition. This is quite a
defensive position to take.
IV. Risk 4: Limitation in its adoption - Beyond Philosophy concludes that the term
customer experience has achieved global acceptance. However, this acceptance is
limited to a few key verticals: telecommunications, banking, retail and several of the
smaller sectors with increasing adoption in aviation, motor and insurance.
V. Risk 5: Timeframe to execute - One of the major problems with CE is that it depends
on the long-term. Its economic basis around loyalty is all about long-term return; its
advantages in terms of being more customer-centric also require levels of corporate
transformation that take years to realize.
What is the strategy to manage these risks?
VI. To avoid the risks companies have to realise that at its heart customer experience is
an organizational strategy based upon a holistic approach to the customer, using
emotion as a key differentiator. This means embedding from the very start the
message that this is a transformational approach, not just one based on tinkering
with the IT infrastructure, adapting call centers or measuring numerous touch points.
These may be part of a solution but they are not CE
What are the 5 Major Drivers?
VII. Major Driver 1: Increasing need to respond to customer empowerment - Customer
experience management used to be driven mainly by concerns over
© 2011 Beyond Philosophy 7
commoditization: CE, in effect, being used as a means for differentiation. However, a
new key driver - customer empowerment - has come to the fore globally. This makes
CE a necessity rather than an option:
a. The 10 customer empowerment drivers are: social media; fast society;
burgeoning middle class; development of high value segments; demand for
international brands; deregulation of markets; increased travel; regulation in
favor of the customer; cultural sensitivity and web aggregator sites.
VIII. Major Driver 2: Increasing need to manage organizational complexity - Customer
experience management is mainly, but not exclusively, a phenomenon of
multinational corporations. Faced with a proliferation of multiple channels, increasing
complexity in terms of IT infrastructure and expansion into new territories, the current
siloed structure of organizations is facing breakdown. With marketing focused on the
four Ps of marketing, customer service focused on service delivery and IT focused
on the web infrastructure, there is a problem of control and communication. This
failure leads to breakage points.
IX. Major Driver 3: Increasing awareness of the importance of emotion and how this
translates into loyalty gains - The way of operating marketing has changed from one
focused on the four Ps to one that increasingly looks at emotion as a platform for
differentiation. In part, this is driven by the commoditization challenge, but also by the
evidence from neuroscience and advanced research, that emotions drive behavior.
X. Major Driver 4: Move from product-based to service-based organizations - In
general, the focus of CE is on verticals with a high customer facing base. These are
industries that would have used the term customer service but now use customer
experience instead. Less apparent have been the B2B industries. However, as many
product based organizations face margin collapse with commoditization, so they will
look to CE as a means to target and develop new service-related propositions. Here,
the ability to manage relationships will be uppermost as the space for differentiation
along product lines declines. This is a trend focused on new wave customer
experience verticals in the B2B space (e.g. manufacturing, logistics, construction and
as current B2C providers integrate CE into their supply chains).
XI. Major Driver 5: Web Experience- The focus on Web enablement is allowing
companies in less mature regions to leapfrog a technology and play on a more even
playing field with the more mature countries. Indeed, in some cases the Web
experience is deemed of greater importance (e.g. Brazil).
© 2011 Beyond Philosophy 8
A Final View
XII. Growth in CE is intimately linked to organizational consciousness of the customer.
This is why some sectors such as telecoms ‘get it.’ There is nowhere to hide, while
others often in B2B are behind the curve. With increasing push from regulation and
pull from commoditization, Beyond Philosophy sees an increasing number of firms
becoming conscious of the need to organize themselves toward the customer.
XIII. In the current market, those sectors coming from a low base (such as
manufacturing); facing fast innovation (such as e-tail) and regulatory push (such as
healthcare) will experience the highest growth. However, there is a comprehensive
need even in the first generation to reconsider what customer experience is (i.e., are
you really doing it?).
XIV. It is no good taking a defensive position around measuring touch points or
rebranding service and research. Organizations need to ensure they ‘truly’ consider
the meaning of customer experience based on its founding notions of organizational
redesign and an emotional commitment to loyalty.
XV. It seems for now CE is standing at a crossroads between success and failure. The
message should be ‘rejuvenate or die.’
XVI. Companies that have emotions inside understand the customer experience far better
than those that assume customers are always rational. With an emotional
understanding, firms are better able to control complexity through customer action,
rather than more controlling measurements.
© 2011 Beyond Philosophy 9
1.0 Methodology
1.1 Quantitative
Beyond Philosophy undertook an analysis of 8,000 customer experience executives.
These executives were sourced from a country-by-country LinkedIn search; comprising
in-depth analysis of 239 countries and regions (i.e., the globe as defined by LinkedIn and
Google drop-down country/ region search list).
To qualify for inclusion, the LinkedIn respondents had to have ‘customer experience’ in
their ‘current’ job title: note that as a networking tool and to maximize coverage of
possible LinkedIn contacts, all main customer experience groups were joined. Likewise,
the search was conducted from a well-networked customer experience consulting group
(LinkedIn contacts were not used for marketing purposes, purely as a means of
research).
In addition, Beyond Philosophy conducted a Google search for firms that apply customer
experience across each of the 239 country and region web pages. In this search,
Beyond Philosophy set specific criteria for acceptance as a CE focused firm. Companies
had to have an active presence in customer experience ‘within the last year’ and ‘within
the country pages’. This was to avoid the presence of non-active firms that engaged in
customer experience over one year ago.
2,106 companies were identified as active in customer experience management
from around the world. This equates to an average of approximately 4 CE
executives per company.
1.2 Qualitative
From the quantitative database, Beyond Philosophy sourced 53 experts with whom to
conduct in-depth interviews on the topic of customer experience. Experts had to have
either overall line responsibility for managing customer experience on-the-ground (lead
PM) or be at CxO level (i.e., director or VP of customer experience). In addition, CE
experts were sourced (i.e., individuals who had deep regional or vertical understanding
of CE and were recognised experts in customer experience).
© 2011 Beyond Philosophy 10
All depth interviews were conducted by phone; excluding one interview that involved a
face-to-face meeting: Interviews typically lasted 20-25 minutes.
1.3 Sample Beyond Philosophy interviewed 53 experts from around the world. These were
distributed by job title (table 1) and by region (table 2).
Table 1: Distribution of the 53 in-depth interviews, including by title
Source: 53 CE professionals
Note: Experts can be general all round or by specific industry
Region Country Number Percent CE Expert CxO Lead PM
NAM USA 8 15% 1 7
NAM Canada 2 4% 1 1
CARIB Bahamas 1 2% 1
SAM Brazil 2 4% 2
SAM Peru 1 2% 1
EUW UK 9 17% 1 6 2
EUW Netherlands 1 2% 1
EUW France 1 2% 1
EUW Portugal 1 2% 1
EUW Switzerland 1 2% 1
EUW Belgium 1 2% 1
EUE Poland 1 2% 1
RUS Russia 3 6% 3
RUS Azerbaijan 1 2% 1
ME Saudi Arabia 3 6% 2 1
ME UEA 1 2% 1
ME Turkey 1 2% 1
AFR Nigeria 2 4% 1 1
AFR Kenya 1 2% 1
AFR South Africa 1 2% 1
IND India 3 6% 2 1
SEA Singapore 2 4% 1 1
SEA Indonesia 1 2% 1
CHI China 2 4% 1 1
AUST Australia 2 4% 1 1
AUST New Zealand 1 2% 1
Total 53 16 25 12
Total% 100% 30% 47% 23%
© 2011 Beyond Philosophy 11
Table 2: Summary distribution of the 53 in-depth interviews by regional percentage
Source: 53 CE professionals
Note: NAM (North America): CARIB (Caribbean); SAM (South America); EUW (Western Europe); EUE
(Eastern Europe); RUS (Russia); ME (Middle East); AFR (Africa); IND (India); SEA (South-East Asia); CHI
(China); AUS (Australia).
The two tables above demonstrate the broad spread of interviews geographically. All
continents were represented in the sample to ensure its global exposure. This dispersal
is disclosed in figure 1:
Region Total%
EUW 26%
NAM 19%
ME 9%
RUS 8%
AFR 8%
SAM 6%
IND 6%
SEA 6%
AUS 6%
CHI 4%
CARIB 2%
EUE 2%
Total 100%
© 2011 Beyond Philosophy 12
Figure 1: Distribution of the 53 in-depth interviews by sector
Source: 53 CE professionals
Figure 2: Distribution of 53 expert interviews by industry
Source: 53 CE professionals
Figure 2 shows the industrial distribution of interviewees: these are focused on banking
and telecommunications. However, a broad cross-section of other industries was chosen
alongside CE experts.
Banking, 19%
Insurance, 9%
Telcommunications, 23%
Outsourcing, 2%Manufacturing, 6%
Retail, 6%
Car, 6%Utilities, 2%
Construction, 2%
Charity, 2%
Logistics, 2%
Healthcare, 2%
Oil, 2%
Experts , 19%
© 2011 Beyond Philosophy 13
2.0 Five Major Risks
Beyond Philosophy identifies five major risks that threaten customer experience
management:
2.1 Risk 1: Use of the Term as a Rebrand for Current Operations
Customer experience is a well-used term as demonstrated by the global spread of
executives with CE in their titles. However, there is a disparity between use of the term
and the actual implementation of a CE program. In fact, lack of understanding on
implementation was the top query about customer experience from the interviewees –
see table 3 – alongside a need to understand the ROI.
Table 3: What is the one question you would like answered about CEM?
Source: 53 CE professionals (where mentioned)
Globally, a number of interviewees raised this failure to implement, essentially the term
CE being in reality a rebrand for existing service and marketing operations.
CE Commentaries
“Australia is not strong in CE development. In Australia, culturally they are
between the USA and the UK so they are always looking to do the same things
One Question Freq.
How should we implement CE (inc. B2B,
Brand, MOT and multichannel)? 18
How can we measure the financial return? 17
How CE can help loyalty (inc. NPS)? 8
How do we get CE KPIs? 5
How can we use emotion? 3
What do customers/ clients really think? 3
How to get a cultural mindset on CE? 2
How to recruit the correct people? 1
What is CE? 1
How can we get board buy-in? 1
What is the impact of Social Media? 1
© 2011 Beyond Philosophy 14
but that does not mean they do it; they get the title but still do standard marketing
things.” (Expert, Australia)
“In China it’s basically training, improving customer service, bringing a culture
and a philosophy to organizations. They have heard about Singapore and want
to embark on a strategy, then implementation. The type of work is not that
advanced in China, but would be quick to take off. A lot of people are speaking
the language.” (Expert, China)
“You can see increasingly job adverts with customer experience tutors, and the
term CX is mentioned more frequently in business and job descriptions. But there
is no common understanding of what it really is about.” (Banking Expert,
Switzerland)
“But here there is a degree of immaturity in thinking and understanding, so they
go for usability or marketing. We have a usability lab, a design agency and lots of
awareness: others think it is customer service.” (Banking CxO, Singapore)
“There is major confusion between customer service (i.e., bounded by customer
service departments) so CE=CS. The other one is confusion with user
experience, so things about web, user interface, design and uxp. Techies think
user experience, business professionals think customer service - here it
becomes survey tools, workforce automation, all stuff related to the contact
center use (as they worry about CSAT).” (Expert, UK)
“Scores only three out of seven, it is only key when it is seen to help our
business, the rest is just lip service.” (Financial Services CxO, USA)
Table 4 gives an example of the way in which the term is being used as a rebrand – in
this case for customer service. This has been taken from markets not core to CEM, but
demonstrates how it is being misinterpreted through vendor spread.
© 2011 Beyond Philosophy 15
Table 4: Examples of how CE is being used badly
Source: Company websites
Here, what is being spoken about is IT infrastructure enablement of contact center
operations. Likewise, contact center human enablements are described by Afghan
Global Insurance: "The claims team becomes active and acts efficiently and swiftly
toward its settlement. This is part of our endeavour to make the AGI customer
experience always a positive one."
Management advice: ensure that you have a clear plan for implementing CEM and
that it is understood as doing something different than what you do today. If you
find yourself without a roadmap and without an understanding of what CEM
means, then you are not doing CEM.
Company Vendor Area Solution Claim Fact
Bhutan Telecom Avaya
Business collaboration
systems, software and
services
Unified Communications,
Contact Centers, Desktop Level
Video Conferencing and Data
Networking solutons
"Enable Bhutan to have an end-to-
end customer experience
management approach"
Customer Contact
Centre solution with
help-desk support and
management
Enabling
infrastructure
Saudi Telecom Aegis Outsourcer
Aegis to manage entire call
customer care operations
including billing, directory
enquiry, collection and
verification
"We are confident Aegis would
provide a great level of satisfaction
given their vast experience in
managing customer experience
across multiple geographies"
Contact Center
management
Enabling
infrastructure
© 2011 Beyond Philosophy 16
2.2 Risk 2: Misappropriation of the Term for Vendor Sales
Another risk is the active misappropriation of the term ‘customer experience’ by some
vendors as a front for rebranding CRM as CEM in order to sell more solutions that
purportedly enable “complete visibility into customer interactions, span the entire
customer experience and provide sophisticated analytics.” (Source: CRM Review)
There is a link here to the popularity of the touchpoint definition of customer experience
in that if an experience is defined as everything, then a sales argument can be put
forward that all interactions need to be measured and ‘seen.’ Hence the trend to redefine
CRM along the lines of CEM in the hope of selling systems that latch onto the touchpoint
mapping concept through promoting end-to-end measurement, end-to-end visibility of all
interactions and increasing the sophistication of analytics.
“There is a lot of CRM being rebranded to CEM. Lots of vendors are doing this
and lots of buyers are thinking it.” (Expert, UK)
There is no doubt that vendor solutions in CRM are part of the enabling infrastructure of
a customer experience strategy, but that is a very different thing from saying that they
are the customer experience strategy (as seen in the call center examples in table 4). If
not managed carefully, a vendor sales fixation risks paralyzing CEM due to the following
risks:
An over-focus on measuring everything rather than measuring everything that is
important to customer experience.
An over-focus on management control rather than creating solutions – effectively,
vendor sales become a job creation scheme without adding any value.
An over-focus on an objective interaction view of the customer rather than trying
to understand their emotion and psychological response.
A lack of focus on how to interpret data, together with the application of poor
analytical understanding.
The problem is akin to what happens with many founding definitions when they hit the
‘real world’ of sales and making a living. With Six Sigma/ Lean and other BPO initiatives
© 2011 Beyond Philosophy 17
the terms collapsed as the intent of improving the customer experience was changed to
cost cutting and efficiency. Likewise, CEM risks collapse, buried under a deluge of ‘let’s
sell everything we can.’
Management advice: Be careful that the infrastructure you put in place, both
measurement and IT, is supportive, not definitive of CE, and avoids corporate
paralysis.
© 2011 Beyond Philosophy 18
2.3 Risk 3: Failure to Take Account of the Customer’s Emotional Viewpoint
(e.g. in ROI)
Customer experience tends to follow a touch point definition. This is quite a defensive
position to take:
CE Commentaries
“Touch point is a solid way to look at it. It means you are looking at more than
one channel and how get all work together. Act like one organization, don't fall
down, but it is quite a defensive definition. Beware cocking it up; aspiration is
what is being caught here - get everything working together and act as one
organization, hand off works between departments.” (Expert, UK)
Theoretically, the start point belies a “moments of truth” approach – use of the word
experience to mean ‘all that is experienced’ rather than inclusion of a more “moments of
delight approach” as in ‘wow that was an experience.’ The risk here is that for some
organizations, this key point of difference between CE and ordinary service – emotional
engagement – is missed. Instead what is produced is an objective map of interactions
that fit well into measuring ‘things’ and implementing software, which fails to deliver a
return because (a) it is an objective view rather than taking into account how customers
perceive you through their feelings and (b) it becomes a theory of everything rather than
about something that gives a return based on the ‘true’ customer viewpoint, which
cannot exclusively be rational.
The emotional view is useful as it forces a subjective perspective, what it is like to be a
customer or client. Hence, it avoids a company-only perspective on customers.
Including the emotional view is also essential in quantitative research: understanding
emotions in resource allocation decisions, and in determining return on investment
(ROI). Unfortunately, among the interviewees (see table 5) there is a disconnect
between appreciating the importance of emotion and how it is actually measured and
understood. The majority of interviewees only undertook qualitative measurement
through focus group, sentiment analysis, verbatim analysis and journey mapping
© 2011 Beyond Philosophy 19
approaches or critical incident type techniques. The situation quantitatively is even
worse, respondents not adapting current measures and just using customer satisfaction
or loyalty indicators (NPS, TRIM) as proxies for emotion. Some avoided the issue as too
difficult or of importance only as an outcome of other measures.
Table 5: How emotion is measured
Source: 53 CE professionals (where mentioned)
CE Commentaries
“Most would not go to emotions. Most people come from an analytical service
management route rather than a brand emotional viewpoint. No more than a
handful use the language of emotion (e.g. by employing anthropologists to look
at user experience). US Bank is going down that path.” (Banking Expert, USA)
Yet, to be clear 88 percent of the interviewees accepted the importance of emotion to
customer experience. It is just that few know what to do about it!
Measurement Freq.
NPS 8
CSAT 8
Don’t measure 8
General qualitatives 6
Cannot measure 5
Journey Maps 4
Sentiment analysis 4
Verbatims 3
Focus Groups 2
Emotion Curves 1
TRIM index 1
Crisis moments 1
Customer immersion 1
Call recovery scripts 1
Quantitative 17
Qualitative 23
Don’t or Cannot 13
© 2011 Beyond Philosophy 20
Management advice: ensure that you have actively considered emotion in your
understanding of the term. Your research and mapping processes must have this
embedded in their procedures.
2.4 Risk 4: Limitations in its Adoption
Beyond Philosophy concludes that the term customer experience has achieved global
acceptance. However, this acceptance is limited to a few key verticals:
telecommunications, banking, retail and several of the smaller sectors outlined in table 9
with increasing adoption in aviation, motor and insurance.
However, beyond these sectors adoption is low: even in the most mature countries,
customer experience is still only used in a few sectors. In less mature markets again,
this is mostly through telecommunications entrance and a push from competitor entrants
in deregulated markets (e.g. Turkey, Nigeria, Saudi Arabia and UAE).
It is often considered that customer experience is approaching mass adoption. This is, in
part, due to the misappropriation of the term and over-branding, In fact, customer
experience as a business strategy that goes beyond a ‘rebrand’ and mind-set is far from
adoption in most markets. In some industries it is noteworthy that interest has actually
only arisen quite recently and that without the right culture in place customer experience
risks falling into a series of often IT-based projects:
CE Commentaries
“Some basics were not in place in the CE team. CE has only developed in
Canada in the last two years. It was noteworthy that people who joined from the
UK had been doing it for the last four years.” (Telecommunications CxO,
Canada)
“Most work in the USA today is in the top 100 banks (in the US there are 4,500
banks). It becomes more complex to manage - one third pay little attention to
experience/service (they only talk about it) but no execution (J.D. Power and
Associates, Satmetrix); one third are trying to do something so CE is a core
© 2011 Beyond Philosophy 21
strategy (e.g. TD Bank, Umpqua, Huntingdon); and one third are dabbling in the
middle - CE measurement. We are three to five years away from anything (at
least at the end of 2010). Now with the change in financial regulation and margin
pressure, momentum has been built to use service core to retain or use
experience to get more share of wallet – to avoid margin squeeze and
commoditization.” (Banking Expert, USA)
“It has some support from leadership now; one of the main risks is that senior
leadership is constantly raising variables to say it is not the most important thing.
IT systems say other priorities need investment. It is a barely conceived program
as yet, we need to establish. If not, it will drift down the list.” (Charity CxO, UK)
“This will increase in the next two years. Some areas are important, and
increasing in CE such as Indonesia and Malaysia. We are looking at demand
there.” (Banking CxO, Singapore)
Management advice: the problems with limited uptake will lead to a “so what?”
mentality. The way around this is to clearly espouse the competitive advantages
of CE (i.e., lack of adoption is an opportunity). To do this requires a clear
definition of its competitive advantages.
© 2011 Beyond Philosophy 22
2.5 Risk 5: Timeframe to Execute
One of the major problems with CE is that it depends on the long term. Its economic
basis around loyalty is all about long-term return, its advantages in terms of being more
customer-centric also require levels of corporate transformation that take years to
realize.
CE Commentaries
“The change occurred over a six- to seven-year time period. Driven by the
chairman, he appointed me customer relationship director to drive change, with a
focus on culture. It made a statement to the company.” (Motor CxO, UK)
“Also patience, Enterprise Rent-a-Car and Apple turned things around in the late
90s from pariah status, but each turn around takes five years. Sprint is currently
in a three- to four-year turn around period. It takes five years to go from awful to
okay, then another five years to go from good to great – the problem is
companies are usually hit by a recession in that time and scrap it, short-termism
does them in.” (Expert, UK)
Related to this is the need for a culture to support the necessary execution timeframes
as well as a supportive and visionary leadership.
CE Commentaries
“Top three to four percent, here CE is a cultural thing, connected to patience and
leadership. A lot can improve, but without changing the culture there can be no
transformation; down the line comes technology and process.“ (Expert, UK)
“Senior execs are the biggest driver, but they don’t know what they are talking
about. They are aware that it means a way to differentiate or they will decline.
Deloitte, in their IBM CE practice surveys, say that execs partly see brand
© 2011 Beyond Philosophy 23
agencies as weak and not grasping effectively with it from an operational
standpoint.” (Expert, UK)
Some organizations have set up an organic way of controlling expectations and
embedding customer experience. The focus of these action-orientated firms is more
ground-up, setting up cross-silo departments that are focused on a support role for
existing structures. For instance, undertaking the redesign of certain existing
experiences on behalf of a department – this could be about redesigning a form through
to creating a luxury experience.
The point is that this approach recognizes the 18-month time delay from set-up of a
department to potential closure (when patience runs out at board level). In this time,
some form of buy-in and return has to be demonstrated through design.
Management advice: Patience and leadership for the long-term are essential
requirements. To stay the course requires setting out up-front a clear vision.
Alternatively, and possible commensurately, a more design-led supportive role
should be considered (i.e., a demonstration of principle).
© 2011 Beyond Philosophy 24
3.0 A Strategy to Manage Risk
To avoid the risks companies have to realize that at its heart customer experience is an
organizational strategy based upon a holistic approach to the customer using emotion as
a key differentiator. This means embedding from the very start the message that this is a
transformational approach, not just one based on tinkering with the IT infrastructure,
adapting call centers or measuring numerous touch points. These may be part of a
solution, but they are not CE.
CE effectiveness requires looking across key areas (see figure 3), each one broadly
sequential to the next:
Figure 3: Key areas of a CE implementation
Understanding CE – get leadership buy-in and understanding as to what exactly
customer experience is.
Setting the Strategy – define (a) where your organization is in terms of the
customer experience, (b) your organization’s understanding of the customer
journey from an emotional perspective, and (c) the emotion drivers and
destroyers of value. Build out a case study based on ROI and how CE will reach
© 2011 Beyond Philosophy 25
your corporate objectives, usually toward competitive differentiation. Develop a
roadmap to change.
Engage the Organization – start to train the organization in the principles of
customer experience, and design in the organizational foundations to support it
long-term (e.g. governance).
Embed the CE Culture – focus on cultural alignment within the organization
through training, recruitment, embedding CE in the employee experience and
leadership buy-in and support.
Process Improvement - only after the company has started to ‘get it’ should you
move to process improvement. Clearly with time lags, some IT system can be
planned in, but the stage of cultural engagement should be in place prior to
delivery of a new CE process infrastructure, for without employee support no
system emplacement will succeed.
Redesign Experiences - finally, pilot implementations of specific customer
initiatives within the first 12 months to ensure proof of concept, and the
perception that change at the customer level is happening (i.e., we are starting to
see how we can get a return). Use emotion journey maps and emotional
measurement to assist in the redesign, but critically ensure creative execution.
If we take the example of a software implementation or other process improvement, this
can now be seen as only a part of the picture. Critically, if there is a failure to align
process improvement to the emotional understanding of customers, then any
implementation is risking failure (see figure 4). Likewise in figure 5, without a cultural and
a governance structure in place, any process improvement risks being piecemeal and
not transformational.
Finally in figure 6, it is no good just undertaking a process improvement without being
able to clearly plan for a pilot test to demonstrate the return; and not just for processes,
but for other areas identified as essentially for emotional engagement, either through
reducing the destruction of value or promoting a driver to value. It is important to note
© 2011 Beyond Philosophy 26
that this is not a theory of everything, as an implementation will depend on this value
impact, so only a few touch points will impact KPIs.
Within pilot implementations a metric should be included as a key CE indicator of
success. This varies from company to company, but usually includes a loyalty measure
and/or emotion/key touchpoint index measures.
Figure 4: Processes need emotional grounding
© 2011 Beyond Philosophy 27
Figure 5: Culture and governance before process
Figure 6: The need to demonstrate proof of concept
Table 6 indicates that the five major risks can be resolved through the use of a
transformational template:
© 2011 Beyond Philosophy 28
Table 6: Resolution of risks
4.0 Five Major Drivers
From the foregoing research, Beyond Philosophy has highlighted the major risks
inherent in how customer experience is currently operated and identified a five-step
process of managing these risks, wrapped around a redefinition of customer experience
toward a corporate transformation process founded upon emotional engagement.
Without this, current implementation approaches to CE that define it in terms of
rebranding current operations such as marketing and customer service, or as a means
to execute software sales, risk collapsing the market and open up the way for a
superseding paradigm.
The final part of this report highlights how, in the market as a whole, the research has
uncovered long-term drivers to customer experience management that mean it is
becoming increasingly important as a strategy.
Risk Assessment
Risk 1: Use of the term as an
over brand for current operations
Resolved – it is part of a corporate transformation
Risk 2: Misappropriation of the
term for vendor sales
Resolved – process change is grounded in emotional understanding
not in vendor pitches to measure rational touchpoints
Risk 3: Failure to take account of
the customer’s emotional
viewpoint e.g., in ROI
Resolved – the emotion view is the starting point and the end point for
implementation effectiveness and hence how ROI is calculated
Risk 4: Limitations in its adoption Resolved – Return on Experience (RoX) is the initial foundation (the
case study is financially grounded); there is no need to depend on in-
industry cases alone [see above]. Further Globalisation of the term
(CE) demonstrates opportunity
Risk 5: Timeframe to execute Resolved – embedding Experience in the leadership and the culture
keeps it alive for the long-term
© 2011 Beyond Philosophy 29
These five drivers are:
Major Driver 1: Increasing need to respond to customer empowerment.
Major Driver 2: Increasing need to manage organizational complexity.
Major Driver 3: Increased awareness on the importance of emotion and how this
translates into loyalty gains.
Major Driver 4: Move from product-based to service-based organizations.
Major Driver 5: Web experience.
Each of these drivers will be looked at in more detail based on the research findings and
evidence will be provided for business case-planning in support of the need to invest in a
customer experience strategy and design.
4.1 Major Driver 1: Increasing Need to Respond to Customer Empowerment
Using CE as a means to satisfy an increasing level of customer expectation
Customer experience management used to be driven mainly by concerns over
commoditization: CE, in effect, being used as a means to drive differentiation. However,
a new key driver - customer empowerment - has come to the fore globally. This makes
CE a necessity rather than an option:
4.1.1 10 Customer Empowerment Drivers:
1. Social media is increasing the spread of negative and positive word-of-mouth
and enabling communication between cultures. This leads to greater awareness
of customer standards.
2. The development of the ‘fast society’ has led to demands for more instantaneous
satisfaction – experiences from other industries and the use of technology (web
downloads for instance) has led to a change in intuitive expectations of service
delivery.
3. The burgeoning middle classes in countries such as India have raised service
expectations.
© 2011 Beyond Philosophy 30
4. The development of a high-value consumer segment in countries such as UAE
and China has raised demand for luxury experiences; requiring incumbent firms
to design new experiences and prompting new firms to enter the market.
5. Customer demand for international brands has encouraged the expansion of
western firms into new markets, and the development of the ‘branded
experience.’
6. Deregulation has opened demand from third-, fourth- or fifth-market players to
differentiate through CE.
7. With increased travel, customers are becoming more demanding in the
experiences they obtain at home.
8. Government regulation (e.g. treat customers fairly) is responding to increased
customer expectations and driving forward interest in reorganizing corporate
structures toward the customer.
9. Cultural sensitivity (e.g. some cultures are more open to the concept due to the
importance of service and hospitality): The middle-east region is noteworthy for
the cultural focus on CE.
10. Web aggregator sites for commentaries and sites that build combined purchasing
power both B2B and B2C are starting to shift the balance of power.
CE Commentaries
“Client expectations are driving it. We do a lot of B2B work, working on client-
based service loans. They want us to treat their customers well.” (Financial
Services CxO, USA)
“At the same time, I did a piece of work linking certain CE metrics to profit. I got
an overall score for the experience, and then compared this to outlets to show a
trend. With recession, demonstrated that if doing well with CE then a link to profit
– this has remained as social media and word-of-mouth keeps customers
informed of which outlets have a good reputation. You need to prove that this has
cash returns, otherwise who cares?” (Motor CxO, UK)
© 2011 Beyond Philosophy 31
“Secondly, it is built into the brand and marketing strategy (customer experience
is the current competitive landscape for most organizations).” (Hospital CxO,
USA)
“Social media plays a key role at least for companies that understand and get the
concept of social media. CE is not about social media, but social media is about
CE.” (Expert, Belgium)
“We are paying more attention to customer complaints. Social media is critical.
Turkey is a top-five country in terms of Facebook and Twitter use. There is a
strong word-of-mouth in social media. One thing is that banking in Turkey is
different from UK and USA; it is like buying gum, and it is easy to move. Because
of competition it is easy to lose a customer.” (Banking PM, Turkey)
“Kenyans are becoming more knowledgeable, they travel more, and they want
customer service in exchange for what they pay. If I pay X, I demand X. They are
less accepting and more want their rights. In terms of development it is five out of
10 (with 10 being highest on the scale). Purely because of more and more
demand - although driven by the top 20% (control 80%). Banks are more and
more aware of service. Now they are shifting emphasis. Sales and service is like
a hand in a glove. We have our customer care center; before it was [open] 8:00
am -5:00 pm, now it is [open] to 8:00 pm. Some centers [operate] 24 hours. This
is a step in the right direction. Mobile phones also offer extended hours of
service. “(Banking CxO, Kenya)
“In India there is increasing awareness as customers travel to the west. This also
comes with an interest in international brands and services. It is a lifestyle and
culture thing. The brands we have are luxury brands.” (Retail Expert, India)
“The company is very similar to UAE. There are high-end Saudis who want the
best quick, fast and efficient. [It is a] money is no object culture. There are not
many expats. Then there are the six million labor class who want things as cheap
as possible. Then there are the Saudis in the middle, who use data on mobile
broadband. But infrastructure is not so good. So there are high expectations of
© 2011 Beyond Philosophy 32
30-40 percent and want it cheap 60 percent.”(Telecommunications CxO, Saudi
Arabia)
“With BI opening up we are seeing also more investment from the west and this
is driving retail.” (Retail CxO, India)
“The world is a global market; it is easier to see what Barclays in the UK: people
travel, get MBAs overseas and want to bring things to our country. However, 30
percent of banks are doing CE, most are not, but they all do customer service. A
push has also been, two and a half years ago we developed a financial
ombudsman that gives customers redress – so a regulatory push.” (Banking
CxO, Nigeria)
“The key measure now is CSAT, being in the annual KPMG survey.” (Banking
CxO, Nigeria)
4.2 Major Driver 2: Increasing Need to Manage Organizational Complexity
Using CE as an organizing principle to achieve customer closeness in complex
organizational structures
Customer experience management is mainly, but not exclusively, a phenomenon of
multinational corporations. Faced with a proliferation of multiple channels and increasing
complexity in terms of IT infrastructure and expansion into new territories, the current
siloed structure of organizations is facing breakdown. With marketing focused on the
four Ps, customer service focused on service delivery and IT focused on the web
infrastructure, there is a problem of control and communication. This failure leads to
breakage points.
Some other examples of difficulty are:
The difficulties of promoting brand and culture principles in an increasingly diverse
corporate environment.
© 2011 Beyond Philosophy 33
The difficulties of achieving ‘customer closeness’ in a complex organization that is
becoming increasingly distant from the customer.
The difficulties of managing the ‘data deluge’ from Web and other systems.
The difficulties of managing multiple channels, often under legacy infrastructure.
The difficulties of tying together a culturally diverse organization.
The difficulties of establishing control metrics when diverse channels are used.
The difficulties of establishing leadership across an increasingly diverse organization.
The result of these difficulties is that where once there was a close connection to
customers, and a clearer ownership structure (i.e., siloed customer service and
marketing departments), now there is a tendency toward ‘command and control
confusion.’
This trend is internally focused on how customer experience can be used as an
organizing principle to re-orientate the organization toward the customer. Some
examples of this re-orientation are:
1. Providing clear guidance as to customer ownership across the whole journey, not
just within marketing or service channels. The holistic approach effectively ties
the siloed organization together and delivers a means of seeing the customer’s
whole journey.
2. Support for the creation of moments of delight. A CE function offers a design lens
to bring to bear value-add moments of delight that would normally be considered
a cost by marketing or superfluous by service.
3. Support for journey redesign, bringing to the fore journey concepts that would be
lost in a siloed environment, yet are central to customers.
4. The implementation through the organization of a customer-centric culture.
5. Re-organizing customer research (e.g. emotional measurement and mapping),
embedding CE metrics, not just the traditional rational metrics.
6. Support for large multi-channel management (e.g. in joining up systems and
processes), promoting a drive to self-service and better web enablement.
7. Support for the branded experience.
CE Commentaries
© 2011 Beyond Philosophy 34
“Most work on customer experience in the USA is in the top 100 banks (in the US
there are 4,500 banks). As the customer becomes more complex to manage, one
third are trying to do something in customer experience as a core strategy (e.g.
TD Bank, Umpqua Bank, Huntingdon); one-third pay little attention to experience
and customer service (they just talk about it) and have no execution (e.g. J.D.
Power and Associates and Satmetrix); and one-third are dabbling with it (e.g. are
starting to look at customer experience measurement but are 3 to 5 years away
from doing anything [at least at the end of 2010]). (Banking CxO, USA)
“I am the first director of customer experience. With over 20 acquisitions in the
last two decades we have realized that there has been no focus on the end client
impact.” (Manufacturing CxO, USA)
“You need to have a founder who believes or gets the religion along the way.
Also, you need patience. With Enterprise Rent-a-Car and Apple, it took
[approximately five] years to turn them around. With Sprint, they are currently at
three to four years in their turnaround: it takes five years to go from awful to okay,
and then five years to go from okay to great. Often the problem is that you hit a
recession and scrap it all- ‘the short-term does them in.’ So success is connected
to leadership and patience. Culture is important, then down the line comes
technology and process.” (Expert, UK)
“With mergers you can create a Frankenstein even though you want to do good
service. Good branch model, but call center has the IVR from hell, outsourced
call centers are mismatched, which leads to frustration. Union Bank of California
tried to clean up their Frankenstein, but they could not. The leader Bank of
America in 2005 had four or five major platforms, now down due to aggressive
convergence of platforms.” (Banking Expert, USA)
“Choreography: at the front and back office: ING Direct gained full alignment
around service delivery especially as the CEO knows how to fire customers!
Zion’s Bank Utah had issues: it was a holding company with different banks.
Customers get different experiences across the bank.” (Banking Expert, USA)
© 2011 Beyond Philosophy 35
“Some form of business practice is not about technology. There is major
confusion between customer service (i.e., bounded by customer service
departments) so CE=CS. The other one is confusion with user experience, so
things about web, user interface, design and uxp. Techies think user experience,
business professionals think customer service - here it becomes, survey tools,
workforce automation, all stuff related to the contact center use (as they worry
about CSAT).”(Expert, UK)
“There are multiple big projects in the market across all industries, many of which
are technology-enabled. For example, banks are replacing core systems to
enable better, faster customer service while reducing costs, insurance
companies are transforming their claims operations enabled by new systems to
provide better service while reducing claims costs, Telco’s are trying to better
leverage their existing CRM and billing systems investments to reduce error
driven contact demand and increase customer service productivity.” (Expert,
Australia)
4.3 Major Driver 3: Increased Awareness on the Importance of Emotion and
how this Translates into Loyalty Gains
CE is the only platform for understanding and redesigning experiences for emotional
impact
The way of operating marketing has changed from one focused on the four Ps to one
that increasingly looks at emotion as a platform for differentiation. In part, this is driven
by the commoditization challenge, but also by the evidence from neuroscience and
advanced research, that emotions drive behavior.
Customer experience management is built on this belief, focusing on the challenge of
providing emotionally differentiating experiences.
CE Commentaries
© 2011 Beyond Philosophy 36
“This is a key and underdeveloped area, not just in terms of how practiced in
business but in research and academics. When I talk about Apple, there is that
instant wow factor, how do we do that in banking, when all they do is open a
current account or provide a gateway for other products and services so it is very
important yet underdeveloped.” (Banking PM, UK)
Interestingly, when asked directly whether emotions were important, 88 percent of
interviewees stated that they were (average score 6.3 out of 7). Further in defining
customer experience there was a strong underpinning of emotional context (although not
in every case):
CE Commentaries
“Indians are very emotional, with a lot of emotional attachment. But it is not given
too much importance in designing the experience. As we are unable to put a line
into emotion, so this dictates the value proposition - quantification of value a
problem so we go to the rational side.” (India, Expert)
“At the moment we are not taking very much into account the emotional response
of our clients, but we want to improve that and increase it in the forthcoming
years.” (Telecommunications lead PM, Saudi Arabia)
“I try to, but very logical but emotions play a massive part (difference between
service and experience). But we are not there yet.” (Construction CxO, UK)
“We must treat patients as a whole - mind, body and spirit.” (Hospital CxO, USA)
“It is about the emotional side. How to engage from start to finish with our client:
creating a sense that people want to go there.” (Banking CxO, Kenya)
“Purposefully design an organization to achieve value by creating an emotional
connection.” (Financial Services CxO, Netherlands)
© 2011 Beyond Philosophy 37
“To experience is to “feel” how the outcome of a rational and emotional response
to a product or service generates happy or unhappy feelings.” (Outsourcing
Expert, India)
“Building a relationship every time you touch them and converting the non-
customer into a customer. This is not just about managing customers, but also
about looking at each moment of truth for all and creating a positive experience,
harnessing the relationship.” (Telecommunications lead PM, Australia)
“The relationship between the business and the customer. It is very important to
be a "family" with your customer, and to have a friend in their face, not just
business. You always have to put a heart in it.” (Banking lead PM, Nigeria)
“Designing, delivering, measuring and improving customers' rational and
emotional experiences of needs awareness, product/service purchase, usage
and renewal, along with all associated interactions.” (Expert, Australia)
“Customer experience: the experience that a company provides to their
customers, which has to be in critical points of contacts; experience when I
engage with a company, the emotions that are felt in that company.” (Expert,
Portugal)
“It’s how a customer feels and remembers a chain of interactions with and about
an organization.” (Expert, Belgium)
“The entire experience, but from the customers viewpoint. Did we follow the
process, to how does it feel, what is the experience, how emotionally
connected?” (Motor Cxo, UK)
CE Commentaries
“Emotions equal interactions. My start point is what is the definition of
experience? I found six definitions, one was around emotion, and one was
around interactions. When they talk about customer experience, what they mean
© 2011 Beyond Philosophy 38
is interactions and emotions. Largely, when you talk, they are talking about these
two. 95 percent is about interactions and emotions and the other five percent is
the other stuff lumped together. Those who ask about emotions are the five
percent who have if not mastered interactions, have minimised the damage of
those interactions.” (Expert, UK)
4.3.1 Translation of Emotion into Loyalty
Companies will increasingly embed loyalty metrics as de rigour over and
complimentary to customer satisfaction and look to CE to execute programs that
drive long-term return through emotional engagement/connection
Complimentary to an increased awareness on emotion is the emphasis on loyalty
returns and hence creating an emotional connection that lasts over the long term. This
has led to an increasing trend away from customer satisfaction toward loyalty metrics.
“There is a lot of interest in improving loyalty. Some companies offer a
comprehensive view of customer experience.” (Expert, Singapore)
“Our mission and values related to our brand as above. In other industries the
drivers are the same (e.g. in telecoms, banking, insurance). We do feed off the
developed world in terms of measurement (e.g. loyalty drivers to profit
measures).” (Banking PM, Caribbean)
“Other initiatives which are less technology focused are banks improving
segment based customer propositions for affluent customers, including loyalty
recognition and reward, wealth managers creating direct distribution offerings for
life insurance, and superannuation products.” (Expert, Australia)
This is best exemplified by the uptake of Net Promoter® (the “likelihood to recommend”
metric). In total, 65 percent of respondents have heard of NPS and know an organization
(whether their own or another in their country) that uses it. By contrast, 35 percent are
not aware of it or are aware of it but do not use it/believe it should be used.
© 2011 Beyond Philosophy 39
Interestingly, of those organizations that use it, there is some conflict starting to develop
in its application:
CE Commentaries
“There is a lot of hype around NPS. A number of organizations are using it.”
(Expert, India)
“In Singapore, there are two schools of thought on NPS: some think, yes, it is the
indicator; some see many other indicators.” (Expert, Singapore)
“I think it is a good method although we decided against it in the company. We
did so because we believe it is too complicated.” (Telecommunications CxO,
Saudi Arabia)
“We do it but it is not core.” (Banking CxO, Singapore)
“Not so much in China. I understand GE, Philips do this.” (Manufacturing CxO,
China)
“Many industries have heard of Net Promoter®, but only a few implement.”
(Expert, Indonesia)
“Not well-used but well-understood. Some variants such as J.D. Power and
Associates, Gallup. I think it is the best measure as it is a top-line relational
metric. Used for CE, but only a minimal amount look to drivers of CE here.”
(Banking CxO, USA)
“We use NPS, but it is not so common here. We had a head of marketing from
Chicago who brought NPS in last year. We used to have CSAT and a loyalty
index. I am not convinced we have done much better; yes the NPS score could
be improved, but it feels like is 'another flavor of the month.” (Banking CxO,
Caribbean)
© 2011 Beyond Philosophy 40
“Not support - too simplistic, it is a popularity measure (desire to be popular).”
(Telecommunications CxO, Canada)
“Yes - heard about it, but don't like it. It has been adopted in the business; I am
trying to un-adopt it. It depends on having the senior management's ear. I think
Reichheld ran out of things to say on customer satisfaction, so it invented Net
Promoter to sell more books.” (Telecommunications CxO, UK)
“In China: concept not as well recognized among marketing.” (Banking CxO,
China)
“It is being implemented in some organizations but has not yet replaced
satisfaction trackers as the de facto market measure.” (Expert, Australia)
“Yes it is used. It is driven by fashion from overseas and the ease to implement.
But don’t implement from it.” (Expert, South Africa)
“Yes we use it. I think that as a strategy tool it is useful, however it has some
slight challenges as it doesn't actually highlight customer issues.”
(Telecommunications CxO, UK)
4.4 Major Driver 4: Move from Product-Based to Service-Based
Organizations
CE is being looked at to move a product-based organization toward service.
In general, the focus of CE is on verticals with a high customer-facing base. These are
industries that would have used the term customer service but now use customer
experience instead. Less apparent has been the B2B industries. However, as many
product based organizations face margin collapse with commoditization, so they will look
to CE as a means to target and develop new service related propositions. Here, the
ability to manage relationships will be uppermost as the space for differentiation along
product lines declines. This is a trend focused on new wave customer experience
© 2011 Beyond Philosophy 41
verticals in the B2B space (e.g. manufacturing, logistics and construction) and as current
B2C providers integrate CE into their supply chain.
Although determinedly analytical in thinking, these organizations will be forced to
compete in the experience arena pulled along by the success of the forward-thinking
innovators.
CE Commentaries
“It has become huge over the last six years. When I first joined it was a product
focused organization, now it’s moving to service.” (Motor CxO, UK)
“It is considered a fundamental. Part of our growth strategy. It is a means of
differentiating under conditions of commoditization (i.e., build in more than just
buying the product).” (Logistics CxO, USA)
“Because a company can never build a sustainable competitive strategy on the
basis of products, as products are rationally evaluated and hence not able to
build traction.” (Outsourcing Expert, India)
“The engine to drive from a product- to a service-based company. More and
more commercial companies start in China to talk about the practice on CEM, not
so much referenced to industrial companies yet.” (Manufacturing PM, China)
4.5 Major Driver 5: Web Experience
Web-based CE is an area of global interest whether through self-service and
efficiency or personalization and care
The focus on Web enablement is allowing companies in less mature regions to leapfrog
a technology and play on a more even playing field with the more mature countries.
Indeed, in some cases the Web experience is deemed of greater importance (e.g.
Brazil).
© 2011 Beyond Philosophy 42
There is a clear self-service trend in stated implementations – holding both cost and
experience advantages – as well as a focus on efficiency and customer service. The fact
that Amazon.com was the most admired firm for their customer experience among the
interviewees (table 19) is informative as to the direction of interest.
CE Commentaries
“Some of our big projects are about enabling customers to self-serve – the best
service after all is often quoted as no service. So we are thinking about pushing
and pulling web content: things like use of video. ” (Utilities PM, UK)
“We are updating the CRM system, standardizing and reviewing the metrics of
CE and developing website with self-service capabilities. Also reviewing our
wholesale strategy and CE design. (Telecommunications CxO, USA)
“Web care solution upgrade to provide great digital experience. Strategy and
processes in social media channel.” (Telecommunications CxO, Russia)
“We are starting to see some initiatives. Ipau is working on customer experience.
Generally though, a lot of talk but no action. Of the big projects we see the Web
experience being huge - in Brazil, companies are looking for a good web
experience. We love social media and the Internet. Ipau yesterday launched a
new website, to give you a new experience. It is a very different website. We are
less concerned about stores offering a differentiated experience. We do some
limited touch point mapping but the web is the main area.” (Manufacturing
Expert, Brazil)
“More website accessibility; making it friendly for users; getting people to spend
more time onsite.” (Telecommunications PM, Peru)
“Yes I see Lloyds doing a lot with their website. First Direct, although a little
different from us, is more customer centric, enabling world class service. HSBC
changed their login service.” (Banking PM, UK)
© 2011 Beyond Philosophy 43
“La redoute - catalog internet furniture company. A very good commercial
example, very efficient and effective web design fostering, first and foremost, the
capacity for customers to dream a house (ambiance) and then find details and
prices on the furniture.” (Retail Expert, France)
“www.Londontown.com. Web, hotel bookings, getting information from the site
for the last three to four years. They are very helpful, can contact anytime,
answer questions.” (Banking CxO, Russia)
“Amazon - because of friendly staff, easy website interface, excellent customer
service, they do all they can to please.” (Telecommunications PM, Peru)
5.0 A Final View
Figure 7: The path to enlightenment
Growth in CE is intimately linked to organizational consciousness of the customer. This
is why some sectors such as telecoms ‘get it.’ There is nowhere to hide, while others
often in B2B are behind the curve. With increasing push from regulation and pull from
commoditization, Beyond Philosophy sees an increasing number of firms becoming
conscious of the need to organize themselves toward the customer (see figure 8).
© 2011 Beyond Philosophy 44
Figure 8: First and second generation enlightenment
Figure 8 shows that in the current market those sectors coming from a low base (such
as manufacturing); facing fast innovation (such as e-tail) and regulatory push (such as
healthcare) will experience the highest growth. However, there is a comprehensive need
even in the first generation to reconsider what customer experience is (i.e., are you
really doing it?).
As figure 9 describes, it is no good taking a defensive position around measuring touch
points or rebranding service and research; organizations need to ensure they ‘truly’
consider the meaning of customer experience based on its founding notions of
organizational redesign and an emotional commitment to loyalty.
It seems for now CE is standing at a crossroads between success and failure. The
message should be ‘rejuvenate or die.’
© 2011 Beyond Philosophy 46
Figure 10: Make sure you are fit for purpose
Companies that have emotions inside understand the customer experience far better
than those that assume customers are always rational. With an emotional understanding
firms are better able to control complexity through customer action, rather than more
controlling measurements.
© 2011 Beyond Philosophy 47
Contacts
For more information on this report or for information about customer experience
in general, please contact:
Steven Walden
Senior Head of Research and Consulting
Beyond Philosophy
Tel: 0207 917 1717
Mobile: 07809 836649
Email: [email protected]