75% of CX initiatives fail on execution – Paul Hagen, Forrester CX Analyst
Statistics across board for Customer Experience (CX) initiatives are alarming. While companies firmly believe (89%) that they will need to compete on CX, their ability to listen to the customer and the agility to create a better experience is dramatically low (less than 25%), resulting in lower ROI (less than 20% of companies could rate their ROI above 8 on 10) with 75% of CX initiatives failing on execution. (Source)
While there are any number of risk factors, in this blog we look deep into the Top Three risks that can derail your CX program.
RISK #1: Lack of Top Management Conviction
One of the first baby steps in your CX program includes embedding a customer culture into the organisation. Customer culture change, which is one of the biggest initiatives a company can embark upon, can only be triggered when the board, a CEO, or several key stakeholders recognize the need for a change from an internally forced, often politically charged, culture to a more open externally oriented one.
One can argue that a strong customer culture should become independent of the top management team. However, without top management buy-in, a new CEO or business unit leader can quickly destroy customer culture by reverting back to a short-term focus driven by financial goals.
Yet another important reason to strive towards involvement and buy-in of the people leaders is so that they can translate these for the teams and generate momentum for change. Clear communication from the top management brings clarity and instils confidence that the senior leaders know what they are doing and why they are doing it.
Once a strong culture is established, you still need strong leadership to ensure it is nurtured and reinforced. Any strategic change, and customer-centricity certainly is chief among them, requires a highly committed and collaborative senior leadership team.
Two initiatives can help to gain buy-in and commitment from the top management.
- A program of customer immersion in which all senior leaders interact directly with customers and report on customer feedback they receive and what it means for the business. By directly experiencing the company’s products or services as a customer, senior leaders get to know what it’s like to be a customer.
- Benchmark the company’s customer culture and identify strengths and weaknesses. This identifies those customer culture disciplines that are strong and most critical to strategy. This provides senior leadership focus for strengthening customer culture across the business.
As Larry Senn from culture consulting firm Senn Delaney rightly puts it – Leaders cast a powerful shadow.
RISK #2: Neglect of people/work culture interventions
Improving customer experience is not the responsibility of one department in an organization. It is more like a revamp of company culture, operations and processes; an overhaul of the mind-set of people in an organization. So it does not come as a surprise that even when customer experience leaders secure the funding, people and processes to make changes, they still struggle to make the initiatives work.
The companies which are in the forefront of customer experience have successfully weaved in customer experience to the very fabric of an organization with minimal resistance to change. They have done this by –
Redesigning the company core values
Creating a company culture that gives utmost importance to positive customer experience is a business leader’s first call to action in his efforts to strategically change the company core values. This brand new core value or mission needs to be practiced from top down. A better customer experience can only be delivered when the employees demonstrate a prevailing and positive outlook on what it means to serve customers and grow businesses.
The payoff? Customers receive excellent service that keeps them coming back for more.
Tip to do this? The organization can come up with core values that are backed up by guidelines that points out how each position and department can fulfil the mission.
Training programs that reflects new core values
The core values should be effectively communicated to the employees and should be reviewed regularly. The employees should be encouraged to “walk the CX talk”. They must be presented with scenarios and case studies on how customer experience can be incorporated into real interactions with the customers.
Recognising Employees as Customer Experience Champions
Attaching rewards and recognitions to customer experience is highly effective as it clearly indicates, both to the employees and the customers, how important customers are to the organization. It also reminds the impact of excellent customer experience for both parties. Employees in an organization should be empowered to recognize each other for extraordinary efforts that impacts customers and their satisfaction.
RISK #3: Not embedding CX into organizational performance management
Companies who are striving to achieve great CX are always experimenting on multiple areas – customer feedback systems, hire to retire processes, training and development etc. But, rarely do they align customer experience with employee performance. Forrester research says that making employees accountable for CX is highly essential for delivering great customer experiences. But most companies fail to do so. Only a third of companies tie employee incentives to Customer metrics and bottom line with only 50% of senior executives, 46% customer facing employees and 23% back office managers having part of their compensation tied to CX metrics.
When CX initiatives are not connected to organizational performance management, the following can happen:
- Disjointed customer support across end to end customer journeys
- Difference in quality of experience at each touch point
- Lag time between customer need and employee action due to lack of autonomy and guidelines
Bringing it all together:
You must have realised by now that the three major risks revolve around the organisation’s failure to start at the top and start right. One recommendation to start right is by having an independent team for CX itself. In our next blog, we will dive deep into the pros and cons of creating a separate team for CX.
Have you come across any other major risks that has caused the derail of your CX program? Write to us. We would love to know.