Gaining Competitive Edge through Superior Customer Experience by BNI Australia

6 Gaining Competitive Edge through Exceptional

Customer Experience Our purpose is to help you achieve your organisationâ&#x20AC;&#x2122;s full potential by making your customers see you as an essential part of their business. At the same time, we will help you to build a customer and stakeholder service platform INSIDE your business that will enable you to THRIVE whatever the market throws at you!

Our DNA is as a consumer company - for that individual customer who's voting thumbs up or thumbs down. That's who we think about. And we think that our job is to take responsibility for the complete user experience. And if it's not up to par, it's our fault, plain and simply. Steve Jobs

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Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

Gaining Competitive Edge through Exceptional

Customer Experience

E-Book Foreword

What is Customer Experience?

Why is Customer Experience Important?

How do these Benefits Add value to the Business?

How is Customer Experience Managed? Stage 1: Commit to CX management & build supportive culture Stage 2: Assess Baseline Capability & Customer understanding Stage 3: Design Strategy and compile Action Plan Customer Experience Management Map Stage 4: Implement Customer Experience Measurement System Stage 5: Implement CX Governance & Management Practices Customer Understanding

6. 7. 7. 8. 9. 10. 10. 11.

Social Media

13.

About Metator

14.

Baseline Capability Assessment Tool Introduction

Part 1: Baseline Framework Integrity

Part 2: Customer Understanding

Score

Part 3: Assimilation and Future Directions

Customer Experience ÂŠ Metator Pty Ltd; version I; November 2013

Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

Foreword Competition comes in many guises but the struggle to a) find customers and then b) keep them is arguably where it’s fiercest. Let’s be clear:       

We are in the age of the customer We need our customers more than they need us Customer experience is not the domain of just sales people Things that make customers unhappy are usually caused by other than front-line staff (refer to customer ecosystem below) Delivering exceptional customer experience is an imperative which requires wholeof-organisation accountability for customer outcomes Customer experience is more than just customer satisfaction or loyalty – it drives customer retention, customer spending and referrals To achieve the full potential of customer experience, it may well be necessary to remodel business practices

Customer experience is driven by all the people in the customer experience ecosystem of an organisation.

Delivery of consistently superior customer experience requires that a business is managed from the customers’ perspective in a systematic, repeatable and disciplined manner. Competitors may offer the ‘same’ product or service as you but they will never be able to replicate the ‘experience’ you provide to your customers – when you get this bit of the business right!

Tony Addiscott Director of Research & Innovation

Customer Experience © Metator Pty Ltd; version I; November 2013

Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

What is Customer Experience? Customer experience is defined as “The positive – or negative – sum of all experiences a customer has with a supplier over the duration of their relationship”. Customers alone decide whether their experiences are good or bad. Sellers can, if they so choose, perform so that the experiences their customers enjoy are as consistently good as possible. We suggest you so choose. It’s the best way to beat the competition! Customer Experience Zone

Sales & Marketing

Product/Tech Support Finance & Accounts

CUSTOMER

SUPPLIER

Customer Service

Purchasing Partners

Touch points Figure 2: the Cross-Functionality of Customer Experience

Customer experience is accumulated at all the touch points that the customer has with the business (see figure 2.) What happens at the touch points dictates whether brand experience is good or bad.

Why is Customer Experience Important? Customers will buy again to repeat an enjoyable experience and loyal customers tend to buy more and more frequently. Also, research shows that 78% of buying decisions in B2B and B2C businesses are based on other peoples’ perceptions of a company and the experience it delivers1. Consequently, the benefits of superior customer experience are: 1. 2. 3. 4. 5.

Improved customer retention Retained loyal customers buy more and more often New sales to new customers through referrals Reduced customer servicing costs Opportunity to spend less on marketing due to reduced focus on new customer acquisition.

The best customer service is if the customer doesn't need to call you, doesn't need to talk to you. It just works. Jeff Bezos

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Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

How do these benefits add value to the business? “Lift customer retention rates by 5% and look forward to an increase in profits of, on average, 75%”. Often spoken or written but rarely accompanied by an important explanation that the increase in profits (or should that be “value”?) may vary between industries and also that the increase in profit/value occurs over the lifetime, or duration, of your relationship with the customer – not over a single financial year. The increase in the value of retained loyal customers, (“Positives” in terms of the Metator Customer Experience Metric) occurs for two reasons: 1. Typically, behaviour by loyal customers will deliver increased profits through bigger than average and more frequent purchases and – also - new business from new customers by way of referrals. 2. The NPV (Net Present Value) of those customers will go up as annual profit earnings and years of relationship increase and, in so doing, boost the value of the intangible asset that the customer base represents. Here is how it works in terms of added revenue and referrals.

Positive Word of Mouth

$ 565

Comparative Values ($ 000s)

1,500

1,000

500

Current Spend (average) $655

-500

Negative Word of Mouth -$701

Current Spend (average)

$ 1,488

$ 1,046

Average Customer

Positives

Negatives -1,000 Figure 3: Total Customer Worth for Positives and Negatives based on Average Spends and Word-of-Mouth Behaviour2

Your customer base is made up of Positives, Neutrals and Negatives (how to identify which is which is discussed later). These categories of customers typically behave differently. Based on research conducted in the USA by Satmetrix Inc., a partner of Bain & Company:  

2 3

‘Positives’ will spend up to 40% more with a preferred supplier than an ‘average’ customer3 ‘Negatives’ tend to spend about 37% less than an ‘average’ customer.

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Metator Better Business Series No. 6

 

Gaining Competitive Edge through Exceptional Customer Experience

Favourable word-of-mouth put out by ‘Positives’ will, on average, result in referrals worth new business equivalent to 50% + of annual sales to an ‘average’ customer. Conversely, unfavourable word-of-mouth put out by ‘Negatives’, according to the same research, had a damaging effect on revenue equivalent to nearly 70% of sales to an ‘average’ customer. There is value obviously in knowing into which category individual customers fit as while the revenue generated by a ‘positive’ could be up to nearly half as much again as an average customer, there could be ‘negatives’ in your client base who might just be costing you money. The second source of value from superior customer experience lies in the NPV (Net Present Value) of your

customer base. The NPV of a customer is defined as “the value of future accumulated income expressed in today’s money”. A customer’s NPV is influenced by three main factors: I. Acquisition cost – the cost paid out to acquire that customer – normally calculated by taking the number of dollars of annual marketing expenditure for new customer acquisition and dividing those dollars by the number of new customers to whom sales were actually made over the period of the marketing budget in question. II. Defection/retention rates – the indicator of average customer duration i.e. say 20% defection each year which signifies an average duration of 5 years. III. Cash flow discount rate – monetary correction factor used to bring future value back to the present. NPV can be calculated using this formula – NPV = ac + (ap x d x cfd) Where  ac = acquisition cost (always negative)  ap = previous year gross profit from that client  d =number of years of customer duration (ideally, based on past retention performance, not “guestimation”)  cfd = cash flow discount rate. The graphic on the next page illustrates how the NPV of one hypothetical customer accumulates as annual profits equate to and ultimately exceed the original acquisition cost of the customer. We asked ourselves what we wanted this company to stand for. We didn't want to just sell shoes. I wasn't even into shoes - but I was passionate about customer service. Tony Hsieh

Read more at http://www.brainyquote.com/quotes/quotes/t/tonyhsieh412223.html#uKvuJ6QE1hsithgs.99 Customer Experience © Metator Pty Ltd; version I; November 2013

Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

7 6 $7,401

$5,523

S1,000’S

4 $3,523

3 $2,449

$2,301 $2,141

$2,000

$1,382

-$917

$1,878

Acquisition cost Future annual profits discounted by 10%

$3,368

Future annual net present values

DURATION IN YEARS Figure 4: Accumulation of Net Present Value for one hypothetical customer over 5 years

This hypothetical performance by one customer show how the opening statement in this section may well be true for your business. This accumulation of NPV only applies if the customer does in fact generate gross profits. As hinted above, ‘negatives’ may in fact incur an NPL (net present loss) each year so you need to know which is which. Referring a ‘negative’ to a competitor is always an option.

How is Customer Experience managed? As with all core governance imperatives, successful management of customer experience (CX) starts with adoption of an effective strategic framework. This consists of five stages namely: STAGE 1

STAGE 2

Commit to CX management and build supportive culture

Assess baseline capability & customer understanding

STAGE 3 Design strategy and compile action plan

STAGE 5 Implement CX governance & management practices

STAGE 4 Implement CX measurement system

Figure 5: Customer Experience Management Framework

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Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

Stage 1: Commit to CX management and build supportive culture This first stage involves two separate functions. 1.1 Commit to Customer Experience Management and define relevant accountabilities The board and senior management should commit fully to a decision to optimize customer experience. Commitment is demonstrated by allocation of the requisite resources to implement a customer experience management framework, preferably headed up by a cross-functional committee of management and workforce representatives. 1.2 Build a customer-centric culture Customer experience is a core, cross-functional outcome for which everyone in the business is accountable. The formation of a committee will send a strong message about the company’s commitment to a customer-centric culture. The CX committee should lead the transition to customer-centricity. The committee will oversee the on-going development of the framework and understanding of the importance of customer experience to the success of the organisation, how it is measured and what’s in it for employees when the business achieves related goals. Development of the right culture will both give employees a greater sense of ownership of success and also give customers consistently more positive experiences than those delivered by competitors.

Stage 2: Assess Baseline Capability and Customer Understanding This is performed with three objectives: 1. To evaluate existing CX management capability 2. To see how well the organisation understands its customer base and to get a feel for their customers’ experiences of the business as a supplier. 3. Formation of recommendations to give direction to a future CX initiative.

A baseline capability assessment tool is provided in this e-book after page 14.

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Gaining Competitive Edge through Exceptional Customer Experience

Stage 3: Design strategy and compile action plan. A customer experience strategy is “a plan that guides the activities and resource allocations needed to consistently deliver an experience that meets or exceeds customer expectations and which competitors will struggle to copy”.

Customer Experience Quality

The action plan to be compiled will provide a 3 phase road map to CX maturity.

Sustain

Transform

Improve

Time Figure 6: Road Map to CX Maturity

The Customer Experience Management Map on the next page illustrates what’s involved in each of the three stages of the road map in figure 6. The baseline capability assessment provided in this e-book is in three parts: a) Baseline Framework Integrity – an evaluation of the extent to which the company’s current customer experience strategy reflects the recommended CXM Framework. b) Baseline Customer Understanding – to assess the extent to which the business has developed an understanding of its customers’ needs and perceptions of it as a supplier – and its ability to maintain customer understanding into the future. c) Assimilation & future directions – recommendations about how to interpret assessment results and how to take customer experience management forward after the assessment. The scores achieved for each part of the assessment will indicate where effort is required to optimize your customer experience capability

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Gaining Competitive Edge through Exceptional Customer Experience

Customer Experience Management Map

Board - long-term Resources allocated

Commitment & Culture

Committee convened Accountability defined Employees on board Strategy is defined Aligned with Business Plan

Strategy

Aligned with brand attributes Shared with employees CX Ecosystem Map Improve

Customer journey Previous complaints

Analyse

Customer feedback Employee feedback Segmentation & VP matching Sampling

CUSTOMER EXPERIENCE

Customer Understanding

Transform

Surveys & analytics Feedback loops Media/blog tracking Customer contact

Sustain

React to feedback Share with employees Purchase metrics Defection/churn Intention to buy again

Measurement

Likelihood to recommend Service quality Opportunities for improvement Print & social media Single KPI monitored by board CX reporting against KPIs Factor in funding approvals

Governance & Management

Factor in policy decisions Hiring for attitudes & values Linked to recognition system Innovation & ideas encouraged Training @ on-boarding & later

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Gaining Competitive Edge through Exceptional Customer Experience

Stage 4: Implement Customer Experience Measurement System

A good customer experience measurement system should ideally provide performance metrics and trend analysis as well with regard to the indicators in table 1.

Table 1: Recommended Customer Experience Metrics Performance Indicators Source of data Frequency and value of purchases Defection/churn

Billing/Sales records CRM/Billing system

Intention to buy again

Surveys (relational)

Likelihood to recommend/refer

Surveys (relational)

Service quality

Surveys (transactional)

Complaints/opportunities for improvement

Incident reporting system

Positive media exposure/blog posts

Media/online tracking services/software

Negative media exposure/blog posts

Media/online tracking services/software

Stage 5: Implement CX Governance & Management Practices Customer experience governance and management practices sustain the business’s customer-centric culture. Recognition of outstanding customer experience performance also boosts employee engagement in and ownership of CX. Which practices are adopted will depend on the company’s current operational and reporting structures but the following are recommended as valuable internal control systems.          

CX performance standards across the whole organisation Documented consideration of impact on CX in requests for funding Documented consideration of CX issues in all proposed policy and/or systems changes Recognition and rewards for suggestions from employees about CX innovation and/or improvements. Performance reporting against set CX goals and KPIs Recognition and reward systems for exceptional above target CX performance Recruiting systems that hire for CX attitudes and values CX training at on-boarding and then on-going Multi-level cross functional CX performance reporting systems Adoption of one enterprise level CX KPI which becomes a standard performance indicator in board reports for scrutiny and discussion at every meeting.

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Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

Customer Understanding Booking a first sale with a new client is hard enough but the acid test lies in whether you manage to book a second sale with that same customer. If you don’t, evidently the experience you gave that new buyer wasn’t good enough to keep their business and that ‘understanding’ was probably lacking. In this context, ‘understanding’ means knowing who the customer is, what they want and need and how they perceive the interactions they’ve had with you as a supplier up to today. Customer experience is defined as “The positive – or negative – sum of all experiences a customer has with a supplier over the duration of their relationship”. Clearly, if your understanding of the customer is not sound enough, your chances of providing consistently superior experiences to that client are slim. The first rule of superior customer experience is ‘unengaged employees do not create and retain engaged customers’. This is why a focus on customer-centricity needs to underpin all the work you do to create and maintain a highly motivated culture. The higher the scores you achieve for the first four individual Metator metrics (highlighted in figure 7 below), the more confident you can be that your culture will support superior customer experience. Metrics relevant to CX culture

LE Leadership Engagement

Employee Engagement

PMy Performance Mastery

iMy Innovation Mastery

= Prod + CX + OSX =

SG&P Sustainable Growth & Profitability

The Metator Metrix Figure 7: The Four Metator Metrics that are the platform for superior customer experience

Part 2 of the baseline (CX) capability assessment evaluates your current approach to understanding customers and, with the map on page 9, will tell you what needs to be done to achieve customer experience maturity based on sound customer understanding. Here are some further hints on how to build customer understanding based on the three stages of the roadmap to CX maturity (figure 6 on page 8). CX Ecosystem: Look at your business as an ecosystem (see Figure 1 on page 2) and map all the visible and behind the scenes employees and partners who have dealings of any kind whatsoever with customers. They are the people who control all the touch points in your business (figure 2, page 3) and who deliver those positive – and negative – experiences that will ultimately dictate whether the client continues to buy from you.

Map Customer Journey: For each customer, list every touch point in the business that the client encounters during an interaction and examine the experiences involved from the customer’s point of view. Every adversity/problem detected represents an opportunity to improve the customer’s experience over time and thus retention of the client’s business.

Inform

Previous complaints: analysis of complaints shows up where customers have had adverse experiences of the business and where there are opportunities to improve future experience by elimination of the original cause for complaint.

Customer feedback: A system is needed to capture random remarks by clients about how Analyse

they see the business and what it does for them. This data is captured at customer touch points and often entered into a CRM system for the information of everyone who deals with that customer. Employee feedback: employees, especially frontline staff, often see and hear things during client contacts that offer ways to change and improve a customer’s experience.

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Gaining Competitive Edge through Exceptional Customer Experience

Segmentation: divide your client base and the market into actual and potential customer groups with similar characteristics and needs matched by a comparable value proposition. Segmentation can also be based on differing levels of loyalty for which different marketing techniques will be required.

Sampling: surveys are an important technique for measuring loyalty and gauging customer sentiment and understanding. Sampling is used to get reliable data from the right people i.e. those who can influence purchasing decisions; equally, the number of responses to a survey required to provide a basis for reliable decision making multiplied by the anticipated response rate – say 45% - indicates the sample size to be surveyed. Sampling is also an important method to avoid survey fatigue.

Surveys & analytics: These are used to capture client data on a variety of important issues such as the likelihood that they will continue to buy from you – and also recommend your business to their friends and Transform contacts – via relational surveys. Transactional surveys are used to capture data about the quality of specific events and services. The Metator M&TS is available to clients for just this purpose.

Feedback loops: customers who respond to surveys will continue to do so if they see that the information they are providing is being used to improve their experience as a customer of your business. They will feel the same way if they see a positive reaction to any complaints and/or feedback they may lodge with frontline people. A ‘feedback loop’ is used to ensure such two-way communication on a regular basis.

Media/blog tracking: a negative post on a social media channel not only exposes a business to reputational damage but also provides valuable information about how customer experience can be improved. A formal social media policy is needed here to make sure that reactions to positive and negative posts are transparent, timely and fair to all concerned.

Customer contact: conversations at every contact are used to mine the relationship for tips and clues as to how experience for that particular customer can be improved. Staff should be trained to listen out for such gems of information which will help you make your customer experience that much more difficult for competitors to replicate.

Sustain

React to feed-back: feedback comes from employees, partners and other stakeholders including shareholders, suppliers and members of the public. The more you can use positive feed-back to boost your brand and reputation, the more customers will want to remain associated with you.

Share with employees: employees manage relationships with customers so all feed-back needs to be shared with them, regularly, to help them to enrich client experiences and to avoid foot-in-mouth disease.

How much do you as a consumer value a positive experience with a brand or its customer service department? How willing are you to share that with your friends? How inclined are you to let that person know that your interaction with them was positive? Simon Mainwaring

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Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

Social Media The internet has altered the balance of commercial power between sellers and buyers for all time. It has also given birth to social media which, whether we’re fans or not, is here to stay. From a customer experience perspective, social media is a double-edged sword. Social Business Patterns are similar in concept to business process flows in that each represents a repeatable, proven set of valueproducing actions.

The downside is that it exposes business to global consumer activism which, whilst not always accurate, has the power to move mountains. Recently, that ‘power’ almost put the Australian live cattle export industry out of business – just imagine what a negative, albeit quite possibly ill-informed, video post on a social media channel could do to a business reputation if the post went viral.

The upside is, of course, that you can use this immense power to your advantage if you wish. We suggest you do this as more and more businesses are using one or more social business patterns to boost performance as shown by the graphics in the side bar5. The social business patterns identified so far are: 1. Finding expertise 2. Gaining External Customer Insights 3. Increasing knowledge sharing 4. Improving recruiting and on-boarding 5. Managing Mergers & Acquisitions 6. Enabling and Improving Workplace Safety Of interest in this context is pattern no. 2 which adds value by enabling you to – a) Quickly learn customers’ opinions and preferences relating to existing and potential products and services, and b) Identify and connect with key customer influencers to aid marketing and customer retention efforts. c) Generate leads d) Build a customer community within your business to enable peer-to-peer conversations about your products and services, consumer opinions, complaints, compliments and really anything else that customers may want to discuss. e) Obtain online outsider inputs to add this essential ingredient to your innovation strategy. The techniques which seem to be most popular at presents are:  Blogging  Twitter (sometimes called micro-blogging)  LinkedIn (for groups and closed discussions  Face book Our preference is for blogging but we would suggest you use a balance of all four. How you can best do this will depend on whether you are a B2B or B2C business and the demographics of your customer base. There is a great deal of information on the web about how you can tackle this challenge and we recommend that you go there and do your research about what’s best for you before you finalise how you ensure that social business becomes your ally rather than your foe.

“Social Business: Social Business Patterns and how they produce value” - © Copyright IBM Corporation 2013

Customer Experience © Metator Pty Ltd; version I; November 2013

Metator Better Business Series No. 6

Gaining Competitive Edge through Exceptional Customer Experience

About Metator Our name: The word ‘Metator’ is Latin and means ‘one who measures’. Measurement of the impact of sustainable desirable behaviours on all people-related, non-financial key result areas – and improving related performance - is what we do . Our Details of our Better Business Suite of products & services can be found at Products & www.metator.com.au/shop . You may purchase a bundle of services to suit your services objectives and time frames. Just follow the tips in the shop.

Customer We like to practice what we preach so we talk regularly to all our clients about how they find Experience us and our products. We may do this using our own survey capability or face-to-face as you prefer. This allows us to keep in touch with all our VIPs who we invite to;  contribute to conversations in our blog at www.metator.com.au, or  make your point or ask a question via the helpline ticket system or  just call or email us any time using the contact details below.

Our Leaders

Tony Addiscott Founder & Director of Research & Innovation An ex-CEO, Tony has extensive experience of how business relationships affect performance. He gained his understanding of stakeholder engagement over decades in management and business ownership during which he has developed expertise in OH&S, innovation, productivity and customer experience. Tony has a particular interest in the benefits of the Metator offering to good governance practices

David Deane-Spread Director of Engagement Services Also an experienced CEO and director with a background in law enforcement, David has established himself as a national leader in embedding leading behaviours and is the acknowledged world authority on Attitudinal Competence. David heads up our team of engagement specialists who help clients to achieve competitiondefeating performance and, in so doing, deliver an outstanding return-on-investment

Mark Graber Founder & Director of Education Mark was a lecturer at the Curtin Business school for over ten years where he lectured in Information Systems within Australia and internationally. His research interests include flexible delivery and online learning, contextual based education, entrepreneurship, mathematics and problem solving. Mark, who has developed many online learning management systems for major global clients, leads the Metator online presence

Our Level 1, Kyria House, 401, Scarborough Beach Road, Osborne Park Western Australia 6017 whereabouts PO Box 344, North Beach Western Australia 6020 Telephone 1300 638 286 Web: www.metator.com.au Email: info@metator.com.au

Customer Experience © Metator Pty Ltd; version I; November 2013

Baseline Capability Assessment Tool

Customer Experience

Metator Pty Ltd: ABN: 50 152 832 847: PO Box 344, North beach WA 6920: 401 Scarborough Beach Road, Osborne Park WA 6017 Customer Experience ÂŠ Metator Pty Ltd; version I; November 2013 www.metator.com.au +61 1300 638 286 info@metatorcom.au

Customer Experience Baseline Capability Assessment

Introduction This assessment tool is used to perform Stage 2 of the Customer Experience Management Framework – “Assess Baseline Capability & Customer Understanding”. It enables the user to gauge how prepared their enterprise is to launch an effective customer experience management plan and it also evaluates how well customers are understood and how customers perceive the user as a supplier. The assessment is in three (3) parts: Part I:

Baseline Framework Integrity – an evaluation of the extent to which the company’s current customer experience strategy reflects the recommended CXM Framework as below. STAGE 1

STAGE 2

Commit to CX management and build supportive culture

Assess baseline capability & customer understanding

STAGE 3 Design strategy and compile action plan

STAGE 5 Implement CX governance & management practices

STAGE 4 Implement CX measurement system

The Customer Experience Management Framework

Part II:

Baseline Customer Understanding – to assess the extent to which the business has developed an understanding of its customers’ needs and perceptions of it as a supplier – and its ability to maintain customer understanding into the future.

Part III:

Assimilation & future directions – recommendations about how to interpret assessment results and how to take customer experience management forward after the assessment.

Resources: It is recommended that the assessment be performed by an objective external professional with no potential bias in terms of the assessment outcomes. A Metator engagement services manager is able to perform this task if a suitable internal resource is not available.

Customer Experience Baseline Capability Assessment

PART 1

Baseline Framework Integrity

Use the scale on the right to rate the statements below as they relate to the current customer experience management capability. Add the scores achieved for each element of the framework. Show N/A if the statement does not apply or if it is not possible to rate the statement for some reason or other.

Scale: 0 = Not at all 1 = Planned but not yet commenced 2 = Started but not yet effective 3 = Operating partially 4 = fully operational and effective

A. Commit to Customer Experience Management & build supportive culture

Score

1. Board and senior management are committed to CX management. 2. Resources have been allocated for CX management 3. Both management and employees participate in cross-functional direction of customer experience management 4. The decision to implement a customer experience strategy has been communicated to all staff who understand relevant objectives clearly, how the plan affects them and the performance levels expected of them 5. Relevant attainable goals have been set.

Total =

B. Assess Baseline Capability & Customer Understanding 1.

A formal customer experience plan exists and has been implemented

Key influences on customer experience have been identified and made known to employees.

The organisation knows about loyalty management and loyalty measurement systems such as the Metator CX metric.

The customer base has been segmented and perceptions of the business in each segment are understood

A baseline loyalty survey of the entire customer base has been completed

Total =

Design Strategy and compile Customer Experience Management Plan

A customer experience management plan has been drawn up

The customer experience management plan has been integrated into strategic planning

Specific actions identified by a previous assessment to identify weaknesses in customer experience management capability are listed for implementation

Appropriate goals and required KPIs have been agreed at all levels of the organisation.

Responsibility for completion of specific actions listed in the plan has been allocated

Score

Customer Experience Baseline Capability Assessment

Accountability for customer experience management performance at all levels has been defined and the people concerned are adequately empowered

Milestones and appropriate time frames have been set. Total =

Implement Customer Experience Measurement System

Appropriate metrics have been selected to monitor a variety of customer experience performance indicators.

The business has access to an online survey and analytics capability to measure customer loyalty and to gauge perceptions

Targets are set for key customer experience indicators and metrics

The business is able to relate customer experience performance to individual touch points.

Total = E.

Implement Customer Experience Governance & Management Practices

The organisation has selected one key enterprise-level customer experience performance indicator for monitoring at board level

Customer experience outcomes are covered by performance mastery agreements at all levels of the organisation

There is a system to reward and recognize exceptional, above target customer experience performance

Total =

Customer Experience Baseline Capability Assessment

PART 2 Customer Understanding Scale: Use the scale on the right to rate the statements below as they relate to the business’s current approach to understanding customers – and ability to do so as well as possible in future. Add the scores achieved for each element of this part of the assessment.

0 = Not at all 1 = Planned but not yet commenced 2 = Started but not yet effective 3 = Operating partially 4 = fully operational and effective

A. Improve 1. Map

Score

Customer experience ecosystem has been researched and mapped

Customer journey(s) have been analysed for opportunities to improve service quality

2. Analyse c.

Previous complaints have been analysed for opportunities to improve service quality

d. A system exists to capture and analyse customer feedback to identify service deficiencies e.

A system exists to capture and analyse employee feedback about customer experience issues Total “Improve” =

B. Transform a.

The customer base has been segmented for value compatibility and/or loyalty scores

Segments have been split into samples to avoid survey fatigue

Segments are being surveyed and responses are being analysed to identify follow-up action

Loops are closed with customers when a need for follow-up action is identified

Social media and/or blogs are used to encourage customer conversations Total “Transform” =

C. Sustain a.

Customers are asked regularly for advice about how service quality could be improved

b. Systems exist to ensure appropriate action is taken following customer feedback c. Customer feedback is shared with employees to avoid foot in mouth disease d. A social media plan exists, has been communicated to clients and is in use. Total “Sustain” =

Customer Experience Baseline Capability Assessment

Score Use the table below to calculate your score for this baseline capability assessment.

Part 1

Baseline Framework Integrity Max: Score

Element A. Commit to CX Management and build supportive culture

B. Assess Baseline Capability

C. Design Strategy and compile Customer Experience Management Plan

D. Implement Customer Experience Measurement System

E. Implement CX Governance & Management practices

Total: Part 1

Part 2

Actual Score

Customer Understanding

Element

Max: Score

Improve

Transform

Sustain

Total: Part 2

Total: Parts 1 + 2

148

Customer Experience Baseline Capability Assessment

PART 3 Assimilation and future directions This assessment does two things: a) It evaluates how ready an organisation is to manage customer experience effectively and b) It examines what the business has done to understand the needs of customers, what can be done to improve, increase and then maintain optimum customer understanding. The cross-functional customer experience committee should consider the assessment scores achieved and decide what the enterprise needs to do to optimize future customer experience. In so doing, it is recommended that the committee considers the following. 1. Cross functional outcomes should be examined together because focusing on performance at individual touch points will reveal why the single enterprise-level CX metric is trending the way it is. 2. In the probable absence of any comparable customer experience data, assessment results are positive management information with valuable potential to enhance the future performance of the organisation. 3. No one individual or team is responsible for baseline assessment results which are previously nobody’s responsibility and thus purely random. 4. To see the way forward from this assessment, the cross functional committee should: 4.1. Look at the score card to identify the measures for which the enterprise recorded low scores. 4.2. A low score indicates a customer experience management weakness. 4.3. Use the Customer experience map to see which customer experience indicators impact on those criteria for which low scores were achieved. 4.4. Then use the map to identify which activities can be undertaken to lift performance and thus improve one or more scores and ultimately customer experience management overall. 4.5. Select one or more criteria as platforms for improvement and seek the resources and approvals needed to implement recommended action plans. 4.6. Install a system to monitor customer experience management outcomes regularly, at all levels of the enterprise, and use the resultant data to drive continuous improvement processes. 5. Customer experience performance should be periodically benchmarked against industry averages and/or previous internal performance metrics. In both cases, trend analysis should be undertaken to measure and guide progress towards achieving the company’s customer experience goals. 6. Once the customer experience management system is fully installed and working, the crossfunctional committee will be well advised to develop an internal customer experience audit tool for use at least once every 12 months. This audit needs to deliver performance feed-back to all levels of the enterprise including board and C level executives. Metator engagement specialists can help with the design and conduct of enterprise-specific customer experience audits. Customer experience management is an endless journey – not a one-off event. Effective customer experience management enhances profitability in good times and protects performance in difficult times. A stable of loyal customers which consistently enjoy good experiences also provides a platform from which to attack adversity by increasing revenue rather than by cutting costs and people. At such times, it is odds-on that competitors could well be looking to batten down their hatches and will not be keeping an eye out for any signs of aggression in the market place.