Where Are The Customers In Your Transformation Plans?

By Harry Cruickshank

I recently re-read with interest a 2020 report by McKinsey: ‘The three building blocks of successful customer-experience transformations’ in which they offer “a proven formula for upgrading customer experience”.1

Several similar recent reports discuss upgrading the customer experience. Most reference customers’ changing needs and the impact the pandemic has had in reshaping expectations and behaviour. However, most make little effort to explain the critical front-end activity necessary to reset an understanding of the customers’ perspective.

An old joke recounts a couple lost deep in the Irish countryside. They stop a local man and ask for directions. “Well,” he says, scratching his head, “If I were you, I wouldn’t start from here.” But this is the situation companies find themselves in if they kick off complex change projects, particularly those with a significant impact on customers, without establishing exactly where their business stands with those customers to begin with.

CEOs often say, “Our goal is to exceed our customers’ expectations.” When they are asked what those expectations are, you get a blank look. How can you exceed them if you do not know what they are? This is not rocket science, but it requires critical thinking to avoid expensive mistakes.

Since the pandemic, many companies have accelerated their investments in digitisation and automation. Sadly, many of these expensive projects have underperformed because they are internally, not customer, driven. Alternatively, starting your transformation with objective and unbiased insights that identify the vital few areas for improvement sought by customers can radically improve effectiveness.

Understanding your customers’ expectations and measuring how you’re performing against them now (in your customers’ eyes) is really the only effective starting point to any customer experience (CX) transformation. Why?

1. You will know exactly what matters most to your customers.

2. You will gain clear and unambiguous feedback on how well you’re meeting those expectations (or not).

3. You will be gifted a roadmap for change, as this identifies:

a. what needs to be changed now (priorities)

b. why it needs to change (customer relevance)

c. the extent to which it needs to change (the relative risk to your business if it is left untouched)

There will of course be other factors that feed into the strategic planning and rollout of changes to the CX model. These could include forecast shifts in market trends, the availability of innovative technologies, internal projects to deliver cultural change and others. But without baseline intelligence on your customers’ expectations and your current performance, how will you ever establish your ‘North Star’ or discover how best to navigate towards it?

McKinsey acknowledges that “the best companies use quantitative research and statistical analysis to ground their decisions in facts about what customers value.” But too much decision-making is already based on spurious information derived from quantitative measures like NPS and CSAT, or social listening, which only provide pockets of tactical information or undiagnostic sentiment.

Whilst technology may accelerate feedback gathering channels and provide lots of data, it doesn’t guarantee knowledge that informs better thinking and action, i.e., insights on what your customers’ priorities are or what you need to change and why.

That’s where expectations-based analysis wins out every time. When it’s done in the right way, the insight it provides is extremely powerful. The pockets of tactical information you already have will be reflected in the overall expectations story, whilst critical insight gaps and priorities emerge to offer a clearer view.

Your transformation plans can be truly customer driven; based on unbiased and diagnostic customer insight that lays out your route map to success whilst helping to reduce your operational risks.

Customer loyalty, trust, advocacy, and long-term value can be yours. Just make sure you start from the right place and follow the right path towards it.

1 Bough, Breuer, Maechler & Ungerman,“The three building blocks of successful customer-experience transformations,” McKinsey (October 2020)