Disrupt or be disrupted?
That is the question facing enterprises managing both the velocity of change and ever-increasing customer expectations. Enterprises are at a crossroads of how to transform their organizations to deliver remarkable, adaptable customer experiences.
Google, Amazon, Uber and other digital natives who started from a clean slate are already there – increasing customer expectations, and the stakes, every day.
Forward-thinking enterprises such as American Express, Vodafone and Lloyds Bank have already taken big steps, reorganizing their companies and their systems around customer needs. Their efforts are already creating higher customer satisfaction scores, stronger internal teams and operational efficiencies.
We work with global companies across multiple industries that are staring down the same set of circumstances. I’ve seen clear patterns in what triggers a company to become more customer focused and what steps they take to evolve the customer experience.
Strategic Vision Versus Knee-Jerk Reaction
No enterprise is immune to digital transformation. While it is easy to pay lip service to having a “seamless” customer experience, internal teams recognize that their organizations have gaping holes in their customer solutions as well as technical and operational barriers to making “seamless” real. The more strategic companies take a step back and come to a simple conclusion: “We can do better for our customers.”
Caring for customers in uncommon ways pays dividends. This simple commitment sparks transformation that touches everything from corporate culture to goals, teams, workflow and technology, down to the code itself. Transformational strategies also factor in the technical, organizational, market and legal complexities unique to their enterprise.
While knee-jerk companies arrive at a similar conclusion about their customers, they aren’t technically or operationally structured for success and delay taking action. Ultimately, they get blindsided by something they knew would come. It may be a bold move by a competitor or the entry of an Uber into their industry. Instead of a strategic approach, they are forced into panic mode, scrambling to throw solutions into market. But a slick new app won’t cover up a flawed process with today’s customers. A cloud solution won’t scale to handle enterprise complexity. In the mad panic, they actually fall further behind.
Look around your industry. What category do your competitors fall into? How about your organization? The strategic companies we work with follow a very similar pattern to achieving their goals.
1. Identify and Empower Your Change Agents
One of my colleagues says that in a great company, “everyone owns the customer.” However, within strategic enterprises, it’s imperative to have a change agent serving as customer advocate and an active catalyst for organizational change.
At American Express, Jim Bush, EVP World Service, is making one of the best customer services organizations in the world stronger by focusing on Relationship Care. A driving insight is that it is no longer good enough for a company to be best in its industry; it must be the best in the world. As a result, American Express has set substantial goals and is generating considerable gains.
Increasingly, it has been members of the C-suite who are identifying and empowering these change agents. They are creating new positions, such as Chief Client Officers or Chief Experiences Officers, to fill the roles. In other organizations, CMO’s are taking on the role, adding customer experience to their responsibilities. Regardless of title, the goal is to have a C-level customer advocate to drive organizational change.
In my experience, companies who give change agents clear mandates make things happen. Companies that don’t take this step burn away years, with market-changing ideas left buried in PowerPoint presentations.
2. Unite Business and IT for Better, Stronger, Faster Outcomes
The phrase ‘every company is a software company’ is so common it generates 437 million search results on Google. But as enterprises become digital, why are so many clinging to the separation of business and IT?
Why do companies still rely on the antiquated process of writing business requirements that then go into a black hole of coding before a solution pops out 6, 12, or 18 months later? This approach is flawed and too agonizingly manual for today’s world. Customers and markets are moving too fast.
The clients we work with believe that the greatest impact in shifting to a customer-centric mindset comes from organizational and cultural changes where business and IT groups collaborate with common goals and focus on their customers. Knocking down the walls between these groups makes them both accountable for business outcomes which drives material impact for the enterprise.
To get there, both need to break bad habits and rethink how they operate. IT can’t continue to approach projects with a “Yes, you can have this in 2021” approach. In turn, business teams can’t just run out and buy stuff because they are frustrated with IT for not responding fast enough. Business people, in particular, need to get closer to the software. They become stronger contributors when they understand what’s possible with software, what’s easy, what’s expensive and what’s not.
Business and IT dysfunction isn’t a new problem, but the velocity of change demands new, more agile ways of solving it. Part of the solution is creating a common language between the groups. Pega software, for example, has a user-friendly interface – enabling business and IT to directly capture objectives – when defining business rules, processes, data models and other factors important to innovation, differentiation and scalable deployment. The Pega platform then immediately generates application code based on these models. Both teams see the result of their thinking in real time, making it easier to make changes during the process and when it’s time for a new release.
This translates into getting solutions to market faster and adapting faster to change, while ensuring the application meets the differentiated needs of the business. Our clients will tell you the approach translates into higher Net Promoter Scores, lower customer churn rates and more revenue from their most valuable customers.
3. Strategize Fast, Execute Faster and Be Ready for Change
Why do some companies surge ahead in customer experience while others lag? I see a balance between strategic decisiveness and quick strike execution.
Two of my great passions are chess, which I’ve played since childhood, and a new-found love of ping pong. Business strategy is like chess where you need to be thinking multiple moves ahead. Execution is like ping pong where you have to react fast and anticipate the ball coming at you from different angles, speeds and spin.
The thought process of a master chess player applies to business strategy. It breaks down into three phases. First is pattern recognition. Patterns ground our thinking and serve as a guide. Next, use those patterns to focus analysis to evaluate what moves might be best. Finally, before making a move, sit back and challenge your thinking and preconceived notions. What have you missed? What disaster is lurking? What might have eluded you that might rip the guts out of your position?
Each of these phases build on each other and are subject to risks. In pattern recognition, it is easy to rely on familiar ideas that aren’t the best for the position at hand. During analysis, even strong players can be distracted from a long-term strategy and do things that look promising but can overreach – creating vulnerabilities and positional holes. And the “what have I missed” phase is critical – not just in evaluating gaps in the position, but also, in thinking about new types of patterns for future evaluations.
Even before you are comfortable with your strategy, in today’s digital world, you need to move quickly and learn by doing. Speed of execution – rapid launches with the ability to adapt and scale nimbly – is where the Ubers and Amazons excel. It’s what today’s customer touches and loves.
4. Think Beyond Big Data
For me, insight drives execution. It’s not just a broad application of big data. Instead, it is the constant refinement of what is often small data – the length of time someone has been a customer, purchase history, value, disputes and resolutions. Data insights should be captured on service calls and added to the customer’s case in real time. Real-time means data is updated immediately and is not days or weeks old. By evaluating data and insights comprehensively and swiftly, you’ll be armed with highly relevant and actionable solutions that can be seamlessly recommended at the moment they’re needed.
Data by itself is just memory. It takes an always-on, always-thinking brain to turn memory into context. Applications need to be able to turn this data into recommended actions and offers. By understanding the steps a customer has taken in a transaction and the context where these steps have occurred, you’ll be more likely to anticipate their next move and the next best action to meet their needs. This understanding gives customers the level of customization they love and increasingly expect. Offers and call center engagements go from being impersonal to being highly personal, relevant and valuable.
Let’s put this into a customer scenario that plays out every day.
A customer phones a company’s call center, inquiring about an order that was placed weeks ago. Despite the fact that this is the third time the customer has contacted the company, the representative on the other end has no background on the customer, and asks him to repeat the same information he’s repeated twice before.
That’s a failure to predict a customer’s needs. Today’s customers simply don’t tolerate that. Empowered with constant access to information and a multitude of choices, they will demonize companies they hate by posting to social media or simply switch companies. On the other hand, they will champion companies they love, going out of their way to provide five-star ratings, written reviews and referrals to their extended networks.
5. Boldly Go
Our clients are in some of the most complex and highly regulated industries in the world. They are not starting their companies with a blank slate. Honestly, I would not advise them to try to be the Uber of their industry. That’s too simplistic.
While you should study the high bar set by Uber, Amazon and PayPal, don’t try to replicate their success. Instead focus your talent, resources and energy on the unique needs of your customer and your industry. Study the patterns and new opportunities. Challenge the conventional. Don’t settle for the limitations of legacy systems. Execute. Adapt quickly to change or force the change. Be a disruptor.