#34 - Kahneman on decisions, your questions on predictive CX analytics, and much more

Welcome to my 34th Customer Strategy Newsletter here on LinkedIn. The current global economic situation, combined with election fever in many countries has made me focus on how to ensure continuity for CX teams. It's a complex subject, as your own employers may consider you to be interesting sources of occasional customer research, but non-essential.

As I learn more about predictive analytics in general, and predictive CX analytics in particular, I realize it is a complex subject. I have my own gaps in knowledge, and I am sure your own understanding is also less than perfect. So you will see that we want to help with that.

Here are the topics this time:

• Daniel Kahneman: “No one ever made a decision because of a number.”
• We want to answer the questions you have about predictive CX analytics.
• Are you measuring what matters in CX?
• The financial case for modern CX analytics.
• IDC on the relationship between employee and customer happiness.
• Upcoming podcast on measuring what matters in CX.

Let's get on with the show . . .

Daniel Kahneman: “No one ever made a decision because of a number”

The ongoing election season in many countries has made me reflect even more than usual on how people make decisions. I consider myself a scientist and like to believe I am rational most of the time. Of course, I (scientifically) realize that this belief is incorrect. As behavioral economist Dan Ariely puts it, we are all “Predictably irrational.” Nobel-winner Daniel Kahneman goes further: “No one ever made a decision because of a number. They need a story.” Our minds jump to a simple emotion-based conclusion first. We may or may not be willing to understand the rationale behind that conclusion afterwards.

This is particularly problematic for CX leaders in these troubled economic times. Ask yourself this question: “At emotional level, are my team and I considered to be essential to our company's financial success, or simply as something management can point to as some sort of proof that the company cares about customers?” I focus on financial success because so many CEOs and CFOs are currently deciding where they can reduce staff.

Yes, I have written quite a lot on how we should be teaming with the CFO to analyze and prove which operational data trends, and therefore which operational actions have the greatest positive and negative impact on customer retention and growth. I believe that firmly, but it is simply not enough. We need stories too, both positive and negative, and those stories should come directly from customers. Use quotes, interviews, and video to support that points you are trying to make with data. The most powerful way I ever did that at HP was by making three videos in which I met with a CEO and two CIOs and gave each a magician's magic wand, telling them it gave them total power over HP. The results were amazingly powerful, and I could never have achieved the same thing simply with tables of data, no matter how compelling I thought they were.

So, what's your story going to be?

We want to answer the questions you have about predictive CX analytics

We have a webinar coming up that we hope will answer the main questions we get about predictive CX analytics. Of course we already have some questions from existing customers but I know there are a lot more out there. My recent experience presenting on the topic in Amsterdam proved that most CX leaders want to understand more. So, what questions do you have on the subject? We have created an online form to gather questions and you fan find it here: https://owencxgroup.typeform.com/to/fAnII7i9 .

If you submit a question, you’ll be taken to the webinar registration page, but here’s a direct link to register, too: https://us02web.zoom.us/webinar/register/WN_m_YAvGOiRfGY1Pz38r1ugw .

Content from OCX Cognition

The Financial Case for Modern CX Analytics was our best-attended webinar ever. It started with a look at the financial case for CX in tight times, and it ended with a challenge from Richard Owen to be ambitious about transforming a discipline that hasn't changed much in two decades. Are you ready? Be sure to listen through to the end to hear a great Q&A session -- and call to action.

On the same general subject, I posted a two-part article entitled A thought in tough times: CX finally fits in Finance. I have long argued that CX leaders should be formal or informal members of sales teams, given they should be the greatest beneficiaries of our insights and actions. In tight economic times I now believe we need to be much closer to the CFO as well. You can find the first part of the article here and the second part here .

Interesting items from elsewhere

OK, the one I have picked this time is both interesting and frustrating. I only just noticed it, even though it is a year old. It is an IDC article entitled Employee Experience and Customer Experience - What is the Connection? Now, if I were studying the topic I would do some sort of correlation exercise. Indeed, regular readers will know that I studied the relationship between American Customer Satisfaction Index scores and Glassdoor ratings for over 300 large companies selling to US consumers for three years in a row. My own studies proved that (surprisingly) there is almost no relationship between the two on average. High-personal-touch industries like restaurants and grocery stores do have some correlation, though far less than I expected.

Anyway, why did IDC publish a report showing a strong connection? Quite easy, I think. Respondents included IT managers and others who want to improve employee productivity and believe, without proof, that this improves customer satisfaction. It is all based on opinions, rather than data. However, the press release linked above is still worth a read, if you can put your scientific thinking hat on while doing so. Here is the key graph from the article:

Coming soon - Are you measuring what matters in CX?

Get your metrics right: It's the first step toward realizing your CX ambitions. But most programs get them wrong. Join us to learn about a new framework to evaluate your CX metrics. Register here: https://us02web.zoom.us/webinar/register/WN_0YQ3C7gtQsOhkTEJZ07XtA

Notes

OCX Cognition predicts customer futures. Our breakthrough SaaS solution, Spectrum AI, lets enterprises transform what’s possible in customer experience. Reduce your customer risk, break down silos, and drive speedy action – when you can see what’s coming, you can change the outcome. Building on more that 15 years of CX-focused expertise, we’ve harnessed today’s advances in AI, elastic computing, and data science to deliver on the promise of customer-driven financial results. Learn more at?www.ocxcognition.com.

Maurice FitzGerald is a retired VP of Customer Experience for HP's $4 billion software business and was previously VP of Strategy and Customer Experience as well as Chief of Staff for HP in EMEA. He and his brother Peter, an Oxford D.Phil in Cognitive Psychology, have written three books on customer experience strategy and NPS, and a fourth book that focuses on Peter's cartoon illustrations for the first three. All are available from Amazon.

The author can be reached here on LinkedIn or [email protected]. Please let me know what you think and what sort of content you would like to see here.