Transforming CX in Customer Service : Top Industry pain points and overcoming those...

What is CX: Quick recap first. While this can be explained in multiple ways, one simple way to put it is, it is how a customer perceives the value and impact of an organization’s product (design and quality), service (design and quality), positive word of mouth and branding, all combined and compared against similar offerings of their competitors. It is fair to say that for an organization, the customer experience itself is the “the new branding,” and the execution and management of it is the is the “new business strategy.” Delivering and managing customer experience depends on 2 key aspects:

1. INSIGHTS - understanding how to influence and win in new ways with customers and

2. INVESTMENTS - applying organization’s scarce resources to deliver the greatest value to their?customers.

Industry surveys indicate that with so many firms focusing on customer experience as the primary differentiator that firms will spend an estimated >10 B$ per annum just to execute customer experience measurement programs.

Today’s customers are well informed and choosy and the products they buy and the experiences they consume or expect, or demand are harder to predict. And the availability of information and the speed of innovation make it difficult even for a market leader to hold on to their customer base intact for long or for a new mover to continue gaining market share. In this challenging and ever evolving landscape, the only principal differentiation that guarantees loyalty and growth is customer experience. Surveys indicate that, today, 89% of companies compete primarily based on the customer experience they deliver.

Let us talk about the pain points that continue to challenge organizations today across industry segments to deliver a wow experience to their customers and they are as below:

a)?????Ensuring quality of each engagement and its outcome with every single customer

b)?????Adopting and accelerating relevant technologies and tools and realizing their benefits as planned, and

c)??????Delivering a value driven and personalized experience which solidifies their brand loyalty instead of just being transactional.

Let us dig deeper on these pain points and understand what the drivers behind these pain points are.

#1: Employee Experience (EX) and establishing an engaging work force:

Ensuring quality, employee morale and deploying new tools and processes in an evolving work environment (remote, gig) continue to be the top pain point.

Employee experience has taken the center stage more than ever. Two of the top three challenges facing CX leaders in 2021 relate to the workforce. Engagement, training, quality control and monitoring compliance are increasingly challenging in the new and distributed work environments, be it in WFH or WFO or Gig economy. Modern labor issues, such as “The Great Resignation” wave makes it the biggest challenging area currently to deliver or to elevate CX. Here are some key industry trends and results that substantiate this pain point.

·??????The pandemic has created 68% more call escalations, 50% more difficult calls and 34% longer hold times - HBR

·??????60% of companies feel they successfully established or improved their remote work strategy - CCW

·??????While WFH has become the most preferred option, by 2025, 50% of?customer service?agents?will have full control?over?their shifts?and break times, up from less than 5% in 2021 - Gartner

Opportunities in front of the organizations are in exploring and deploying agent-assist technology as well as quality management and workforce optimization tools which are among the most valuable new features for managing CX today.

The bottom-line is that effective workforce management delivers the much-needed employee experience (EX) which results in customer experience (CX). While organizations have invested and focused on CX related processes and tools, it is equally important and relevant in today’s context to invest in employee experience and engagement related tools and processes. Without this, the cost of rehiring, training, and delivering results will be extremely high and not to mention, bear a negative impact on CX.

#2: Enabling with Digital Experience (DX) by adopting and scaling technologies, and realizing benefits

For every single organization realizing value or returns from investing in technologies (e.g., Virtual Assistants, Cloud adoption, Analytics, IOT…) is the number one strategic priority today. Here are some industry trends to quote:

·??????52% of the companies accelerated their AI adoption plans because of the pandemic - HBR

·??????By 2025, customer service organizations that use AI-enabled knowledge automation will achieve 90% first contact resolution, up from 50% in 2021 - Gartner

·??????Cloud platforms are driving innovation in the contact center space. With the rise of cloud-based platforms, the ability to rapidly test and deploy modern technology features has turned CX into an innovation goldmine. But the adoption is estimated to still be at 32% as of year-end 2021.

Clearly industry feedback is that improving service journeys and performance through modern technologies and techniques are strategic objectives and one of the top 3 focus areas for next 24 months for organizations. Having said that, continuing challenges that exist are ineffective automation, fragmented technology, and mismatched engagement channels.

Organizations have not yet mastered and still maturing in the art of realizing the value from investing in these technologies as they planned, but their profitability seems to have shown improvement due to the adoption of these technologies.

#3: Ideal Customer Experience (CX) with personalization of customer engagement knowing and predicting who my “Customer” is.

With many organizations being multi-product sales and service machines, the need for building a singular view of who their customers are, what product or products they own, how they consume those products, what else they expect from the features or services and how they want to engage through their channel of preference etc. become extremely critical to understand, design, build, deploy and measure for a customized engagement.

Organizational silos, fragmented pools of data, non-standardized processes and non-scalable toolsets make it a nightmare for many organizations, more so for larger and multi-product organizations to have a singular and holistic view of their customers and to deliver a wow CX.

With most of the organizations going for omnichannel touch points to deliver CX, it is an important task and an opportunity in front of the organization to build connected systems which can provide this holistic view of each customer in their ecosystem.

Between 2017 and 2021, volumes* grew significantly across many of the touchpoints, 1.6X in social and web messaging, 2x in voice and email, 2.2X in Live webchat, 3.8X in SMS/MMS (*Genesys CX survey 2021) which have multiplied or have the potential to multiply the complexity to orchestrate the tools and processes to bring a unified and singular view of their customers.

In addition, since 2017, more than one in 10 consumers worldwide used a virtual home assistant such as Amazon Alexa or Google Home to interact with customer service.

So, in summary, integrating the data that got collected and accumulated across all these touchpoints, extracting actionable truths, and elevating the intelligence or the wisdom of when, how, and in what order to act, is where the most tangible and scalable benefit is hidden to elevate CX.

Over the past year, only 20% of the organizations have said that they are highly successful in bringing a personalized experiences to the customer and rest are somewhat successful or not successful. That provides a major opportunity.

Using data and AI for customer insights and personalization is the number one strategic priority for CX leaders. There’s increased ROI on personalization: Survey data also shows that efforts to personalize are paying off — consistently personalized experiences are powerful drivers of wallet share and peer advocacy.

Still, most companies feel they have been “somewhat successful” at achieving the pivotal goals of reducing effort and increasing personalization as per a CCW survey.

Finally #4: Business Experience (BX) - value driven experience that the customer support organization from “cost to serve” towards “value to monetize”.

This involves, transforming, scaling, and realizing value beyond just managing cost to serve through personalization of customer engagements across all touchpoints.

Proxy metrics such as CSAT aside, the business metrics of profit and revenue are the most relevant metrics for the organizations.

·??????One of the studies done by NTT in CX in 2021 clearly indicates that measurement of CX operational performance is no more outcome led. Customer retention / churn and sales performance (including customer value, leads generated) are the top 2nd and 3rd important metrics which we were not part of the top 5 metrics in 2019 and 2020.

·??????In 2021, customers said they are more likely to purchase additional items, make recommendations to friends and colleagues, and devote a greater share of wallet to companies that consistently personalize their experiences than they were in 2017.

At the end of the day, business metrics are an even more of a definitive “outcome” than customer satisfaction metrics. Any customer contact function that values CSAT should, therefore, have just as much (if not more) of a vested interest in assessing business impact.

Now, with the clear understanding of the pain points that exists in the industry to elevate CX, let us do a deep dive on a CX Transformation framework – the 5P’s approach in my next post ....Leave your thoughts and comments in the meantime..

Shiv Padmanaban