Monday, September 20, 2021

Explicit and Implicit Changes Drive Customer-Centric Culture

Many leaders try to change their corporate culture to be more customer-centric. In a recent poll of 57 CMOs, we asked the top five questions that are most urgent to bring success to the marketing department in 2022. Three of the top four answers require leaders to operationalize their customer experience (CX) data, values, and processes into their company's culture and employees’ daily jobs:
  • How can bring the voice of the customer to cross-functional business decisions (e.g., new product development, innovation)?
  • How can we ensure that brand and CX strategy are reflected in business operations?
  • How do we build a consistent brand experience across audiences and channels?



Changing culture is always a challenge. Efforts to create customer-centric change are undermined when leaders don’t implement both explicit and implicit expectations and rewards.

Explicit Customer-Centric Culture Change

Explicit expectations and rewards are the ones leaders communicate clearly and directly. Often, for example, leaders will share and promote the organization’s new CX values. Another explicit action many leaders use is to develop training programs to help employees understand CX processes and expectations. These efforts make clear the vision the leader has for the organization and its employees.

These are a good start, but one of the explicit changes leaders often fail to make is to consider the way employees are recognized and rewarded. There’s an adage that employees do what they are paid to do, not what their bosses tell them to do. Simply put, setting new customer-centric expectations for employees while changing nothing of how they’re compensated or recognized undermines the effort. For example, training call-center employees to be more empathetic with customers often brings little change if those employees continue to be rewarded more for efficiency (call handle time, call volume) than customer-centric impact (the improved satisfaction, greater trust, and reduced effort that customer-centric care can deliver.)

There has long been a debate in CX circles about the value and wisdom of compensating employees for CX outcomes. Explicitly tying bonuses or financial rewards to employee customer-centric performance requires care to mitigate challenges (such as ensuring employees cannot manipulate the results and making CX KPIs fair and accurate to each employee’s job.) But, even if your organization doesn’t tie direct financial rewards to employee CX contributions, there are still important ways to measure and reward employee performance in explicit ways. These include altering performance appraisals to consider examples of customer-centric behavior or creating recognition programs where employees can nominate each other for demonstrating customer-centric commitment.

Implicit Customer-Centric Culture Change

Often, leaders lean on explicit communications and rewards to create customer-centric change while being unaware of the implicit ways they may disincentivize customer-centric behaviors. If leaders aren’t cautious, they can send mixed signals, demanding customer-centric changes in straightforward ways while implying different values via their day-to-day decisions and actions.

If you wish to influence a customer-centric revolution in your firm or team, you must consider:
  • Have you listened to what gets in employees’ ways as they strive to achieve your explicit customer-centric goals? Asking employees to be more customer-centric without considering your organization's processes, policies, systems, and rules that prevent employees from providing a great CX is one way to disincentive customer-centric change. Another is to ignore sources of unnecessary employee effort that can lead to poor customer experience. In a recent Gartner study, we found that 66% of employees agree with the statement, “The easier it is for me to do my job, the easier it is to provide customers with an excellent experience.”
  • Do you make all or most of your decisions based on short-term ROI? It won’t matter how much you exhort employees to deliver better experiences if your actions convey you care more about immediate financial outcomes such as increased sales or reduced costs. Consider how you evaluate, prioritize and approve ideas and projects. Do your criteria match your customer-centric goals? Or does your evaluation process penalize customer-centric ideas designed to provide what customers want, need, and expect while rewarding proposals that deliver company-centric financial gains?
  • How do you speak about your business results? If you prioritize and focus only on financial outcomes and not customer impact, you implicitly convey to employees that is what you value. When I was at USAA, I once had a senior leader admonish me for providing a project update that began with the financial ROI before discussing the positive impact on the customer. “Lead with how we improved our member’s lives and relationships with USAA, then communicate how it impacted our top and bottom lines,” he told me. That statement says a lot about what he valued and, perhaps, explains a lot about what makes USAA so different, earning some of the highest NPS scores in its category.
Quote:  “What you do speaks so loudly that I cannot hear what you say.”
Photo by Patrick Fore on Unsplash

Ralph Waldo Emerson once said, “What you are stands over you the while, and thunders so that I cannot hear what you say to the contrary.” Over the years, that thought has been shortened into a pithy statement also attributed to Emerson: “What you do speaks so loudly that I cannot hear what you say.”

The point he makes is that we don’t convey who we are and what we value with our explicit words but our implicit actions. For leaders, that means customer-centric culture change depends on what you do, not just what you say. The ways you implicitly encourage or dampen customer-centric behaviors can do more to affect your organizational culture than all the explicit expectations you communicate.

This blog post was originally posted on Gartner's website: https://blogs.gartner.com/augie-ray/2021/09/20/explicit-and-implicit-changes-drive-customer-centric-culture/

Friday, June 11, 2021

The Dwindling Well of Forgiveness for Your Post-COVID Customer Experience

Photo by Marco Bianchetti on Unsplash.com

Last March and April, as businesses struggled to implement "work from home" policies and contain service disruptions, something remarkable happened: Customer satisfaction scores rose. Clients and Voice of the Customer platforms reported that VoC scores improved quite broadly across categories and businesses.

Why would customers report more satisfaction as service quality declined? Forgiveness. As your customers fought to adapt to the new pandemic reality and saw their employers grapple with COVID-induced difficulties, they were more inclined to forgive the sorts of experiences that would have previously generated a complaint. By summer and fall, as life settled into the "new normal," NPS, CSAT, and effort scores tended to return to normal (and, in some cases, declined as brands tried to meet customers' new expectations.)

This spring, as the United States recovered from COVID, mask and business restrictions lifted, and people returned to normal--US restaurants have operated within 5% of their 2019 volumes on recent weekends--it seemed a grateful population was ready to return with a new well of forgiveness for businesses striving to adapt to post-pandemic difficulties. But I've noticed that the well of forgiveness is rapidly dwindling, and that means organizations must consider what is necessary to either get their customer experience (CX) right or to replenish their customers' well of forgiveness.

As I research and advise clients on CX best practices, I observe that brands fail to understand the full ROI of CX. As CX improves and customer loyalty is strengthened, brands will measure direct financial benefits such as improved sales, reduced churn, and increased lifetime value. Brands also often seek to measure softer benefits, such as enhanced engagement and greater WOM. But one benefit of CX is often overlooked, and that's forgiveness. Strong, consistent customer experiences earn more forgiveness. More forgiving customers are inclined to overlook isolated problems and are less likely to seek redress or share frustrations with others.

If your brand is struggling with adapting to the rapidly shifting post-pandemic world, don't ignore the problems but meet them head-on. I offer five suggestions you might consider to earn more forgiveness and loyalty on my Gartner blog. Please click here to continue reading.

Friday, April 9, 2021

Gartner Expands Its Definition of Customer Experience Management (CXM)

The word "Change"
Photo by Ross Findon on Unsplash
Every now and then, there comes a time to recognize that the world has changed. My peers and I at Gartner spent several months discussing, debating, and building consensus for a change to our definition of customer experience management (CXM). Given the increase in investment in and the growing maturity of CXM programs, we felt the time had come to advance and expand our definition.

Our existing definition was, "The practice of designing and reacting to customer interactions in order to lift satisfaction, loyalty, and advocacy."

Our new definition of CXM isn't quite so succinct but does more to promote the scope, goals, and scale of enterprise-wide CXM efforts:
"CXM is the discipline of understanding customers and deploying strategic plans that enable cross-functional efforts and customer-centric culture to improve satisfaction, loyalty, and advocacy."
Our existing definition of CXM, which was over a decade old, didn't capture how the practice of CXM has evolved. We have observed many changes in how our clients approach and accomplish CXM, and these include:

  • Customer understanding: You can't design and deploy a great customer experience (CX) until you know, listen to, and understand your customers. Much of what makes CXM successful in great companies isn't about the projects they execute or the customer-facing tech they implement--it's about how they gather, analyze, and disseminate customer understanding.
      
  • Repeatable and ongoing discipline: Gartner's former definition called CXM a "practice," which is a habit or the application of an idea. That word didn't convey how CXM has become a constant, vital commitment firms make to improve their customer experience. CXM isn't a project, mindset, tool, or process. It's a discipline--a living, evolving, repeatable and ongoing set of capabilities that demands continuous investment, requires a system of governance, and delivers measurable outcomes.
      
  • Enterprise-wide strategy and collaboration: Our old definition did not reflect the scope that CXM requires to be successful. While one individual or team may have positive customer-centric practices that lead to CX improvement, a successful CXM program must inform, establish and scale these efforts across the entire organization.
      
  • Customer-Centric Culture: Finally, while the former definition put the focus on a CX outcome, our new definition recognizes that CXM leaders must enable change within their organization. You cannot achieve the desired goal of constantly improving CX throughout your customers' end-to-end journey unless you affect how the organization works. A strong CXM leader doesn't merely oversee individual projects that positively impact customer satisfaction, loyalty, and advocacy; they must influence everyone within the organization to change how they work in a way that results in improved customer satisfaction, loyalty, and advocacy.
Our new CXM definition aligns with Gartner's CX maturity framework. By design, it is intended to reflect the nine elements of CX maturity (voice of the customer, customer research, personas and journeys, strategy, technology, roles and governance, customer-centric culture, purpose, and metrics). If you're a Gartner client, you can learn more about the revised CXM definition, how it can help bring consistency to the understanding of CXM in your organizations, and how to mature your CXM programs by reading "Use Gartner’s New Definition of Customer Experience Management to Align to CX Scope and Goals."