Why do so many organizations struggle to improve customer experience in a measurable and sustainable way?
The benefits of improving customer satisfaction are well understood and Forrester, among others, has quantified the revenue that improved customer satisfaction can deliver. With its importance in creating customer satisfaction and bottom-line results, why do so many organizations struggle to improve customer experience in a measurable and sustainable way? Based on the large companies I’ve worked with in this space, the traditional lenses of people, process and technology can provide key insights into one specific barrier—organizational structure--and show effective ways to overcome them.
Taking a page out of W. Edwards Deming’s approach to quality management, we must consider the “people” definition as not only the actions of individual employees, but also the organizational structure If we consider people to be more than the individuals within an organization, but to also include the organizational structures within which those employees function.
Most of the challenges I’ve observed in large, multi-channel, multi-LOB companies with which I’ve worked originate in the org chart. The one box that has both responsibility for customer experience and the span of control to impact it broadly isn’t usually found more than 1-2 levels down from the CEO. Accepting that corporate decisions are made in alignment with organizational structure and their inherent effect on compensation, it’s no wonder that most customer experiences are optimized by channel, LOB or product because that’s how the organization is structured. And there’s rarely a leader with enough financial, human and political capital to connect those experiences together into something that resembles a customer-focused experience.
Research shows that consumers are often less-satisfied with the overall experience that what they report for individual products or channels. Bottom-line, the organizational structure creates significant barriers to improving the customer experience in a way that feels satisfying and consistent to those customers experiencing it.
The process of delivering and continuously improving the customer experience is also constrained by the organizational structure. Decisions to improve and optimize any activity, including customer experience, are generally made within the confines of the organizational structure. Goals and KPIs are usually aligned with optimizing performance within a particular channel or LOB, such as call center or mortgage processing satisfaction. When overall satisfaction is measured, it’s often done using techniques that are difficult to deploy that allows ongoing operational measurement of the drivers of satisfaction. And it is rarely done in a way that allows incremental experience improvements to be tested, their impact quantified and financial ROI well-documented prior to making significant investments in experience improvements.
Technology that can break the confines created from org structure is well-established, but, like people and process, is often deployed in a way that aligns with the limitations of the organizational structure. Large organizations often have several projects loosely aligned to a customer experience improvement initiative. Few will have a set of business capabilities the projects are expected to provide with committed dates that demonstrate how combinations of projects will deliver needed functionality. Many will have a clear, often rigid, technical architecture leveraging emerging technology so internal IT teams can get experience deploying the latest shiny object. Few have will have a documented business architecture that clearly articulates how the technology architecture supports the business needs.
Intentionally designing an agile customer experience management eco-system that organizes the data, analytics and interactions in a way that supports the breadth, complexity, variability and continuous change inherent in actively managing the customer experience at a macro-level and at an individual customer level, plus the numerous levels and groups in between.
So, can progress only be made when companies are organized around customer groups or experiences? No, I’ve observed many companies make considerable progress on customer experience improvement while remaining in their channel or LOB aligned silos. Well, how do they do it?
I’ll dig deeper into this in my next post but the key capabilities include:
• An agile analytic eco-system designed to handle the volume of data, the complex analytics and the ability to rapidly experiment and measure across channels and LOBs
• A business-led program that details the required business capabilities, aligns current, and future-needed, technology projects and manages the funding required to deliver those capabilities
• Customer experience improvement performance metrics for all levels with the ability to demonstrate how their decisions and behaviors impact the overall customer experience.