the counterintuitive nature of customer experience management

The Counterintuitive Nature of The Counterintuitive Nature of C t E iC t E iCustomer ExperienceCustomer Experience

Qaalfa DibeehiQaalfa DibeehiVi P id C l i & Th h L d hiVi P id C l i & Th h L d hiVice President, Consulting & Thought LeadershipVice President, Consulting & Thought Leadership

© Beyond Philosophy ™ 2001-2009www.beyondphilosophy.com

The Beyond Philosophy Perspective Leaders at helping organisations define & build emotionally engaging customer experiencesengaging customer experiences

Global projects: Strategic Partners in

Asia and EuropeEmotional side

of Customer

Beyond Phil h

of Customer Experience

PhilosophyOffices in London, England & Atlanta, Georgia

Links with Academia

© Beyond Philosophy ™ 2001-2009www.beyondphilosophy.com1

We work with some great organisations…

…improving their customer experiences


How we add value…Customer Experience Management is a relatively new area ofCustomer Experience Management is a relatively new area oforganization development. We help companies answerand action tough questions like:

What is the future of our competition?

What do our customers expect of us?

How much is my current Customer Experience How much is my current Customer Experience costing me?

What is the Customer Experience we are trying to deliver?to deliver?

How deliberate is our Customer Experience?

What emotions are we trying to evoke in our Customer Experience?Customer Experience?

Are our senior executives engaged in the Customer Experience?

l d d hHow can we ensure our people understand the importance of the Customer Experience to our organization and become motivated to change their behaviours?


t e be a ou s

Hand Poll

Strongly agree

Strongly disagreeg g

The following provide an entirely appropriate Customer Experience for their customers

Disney

ld’

Customer Experience for their customers…

McDonald’s

Your police forcep

Your company


What is Customer Experience?

Customer ExperienceCustomer Experience

is NOT about doing

h kwhatever it takes to

“wow” customers


Customer Experience definition

A Customer Experience is an interaction between an

organization and a Customer.

It is a blend of an organizations physical

performance, the senses stimulated and

emotions evoked emotions evoked, each intuitively measured

against Customer Expectations

across all moments of contact.


co tact

6

Experience and Opportunity Gapsp pp y p

Current Customer Expectations

Experience GapExperience Gap

Current Customer Experience

Opportunity GapOpportunity Gap

Deliberate Customer Experience

Opportunity GapOpportunity Gap

Company specific customer experience including process and relationship aspects


Yorkshire Water Improved overall Customer Experience from 53%-91%.

Kevin Whiteman, MD, “although you start with the mantra that this is going to cost you more, the reality is the opposite - the evidence is that it will save youis the opposite the evidence is that it will save you money”. £ 8.5m ($15.5m) as a direct result of operational improvements such as:

– Reduction in written complaints by 40%; a i ifi d i i ll i h hsignificant reduction in repeat calls with a sharp

increase in first call resolution; reduction in Operational calls by 20% due to infrastructure improvements, system implementation & new

d l d d f f

“The Kelda Group has

procedures – leading to a reduction of 50% of unnecessary jobs

Employee total “buy-in” to the CE through training The Kelda Group hasturned itself from one of themost ridiculed watercompanies in the 1990’s,into one of the mostrespected It is now the

sessions (with average event score of 3.7 out of 4.0).

Kevin: I’m absolutely convinced it has an effect on theshare price. The stock market is like anything else, itworks on perception as well as reality If every bit of respected. It is now the

second best performingcompany in terms of servicelevels and has developed arecord for steady financialperformance ”

works on perception as well as reality. If every bit ofnews they get is about a transformed company,about our growing reputation of being an efficientcompany that delivers a good Customer Experience…


performance.Financial Times

Why clients want to improve the Customer ExperienceCustomer Experience…

Regional utility provider – 20% increase in Customer Satisfaction and 25% reduction in call volumesRegional utility provider – Improve public and industry image, e.g., winner of the 2003 Utility Industry Achievement Award for Customer CareInternational FMCG / retailer – 1% increase in Customer Satisfaction driving a 1.3% increase in revenuesGlobal multi-service telco – 36% improvement in Customer Satisfaction, 17% costs reduction and 200% increase in customer-facing timeEuropean insurance provider – 80% reduction in transaction costsGlobal PC manufacturer – 79% improvement in “Missing, Wrong & Damaged” deliveries resulting in reduced back office headcountInternational wireless telecoms provider - 82% of Customer pInteractions “better than last time” helped by a 4% increase in first call resolutionCanadian Bank – Losing 26% of high value customers. Saved 6% of


high value Customers – value CDN $ 85m

A straight forward advertisement… call us,Customer – “Hi, I saw your ad in the paper

and wanted more info”advertisement… call us,we can help you better your vision

and wanted more infoUltralase – “Certainly, may I have the code

number of the ad you are referring to”


The Customer Experience is both Rational and Emotional

• Rationally satisfied customers behave th

Rational (Conscious) Experiencethe same as dissatisfied customers.

• Emotionally satisfied customers contribute far more

Product Price

to the bottom line than rationally satisfied customers

Promotion Placement

customers.


At least 50% of the Customer Experience is based on the emotional engagement

• Rationally satisfied • Rationally satisfied customers behave the same as dissatisfied

Rational (Conscious) Experience

customers.

• Emotionally ti fi d t satisfied customers

contribute far more to the bottom line than rationally than rationally satisfied customers.Emotional (Subconscious) Experience


Best Practice: Customer metrics

Customer Satisfaction

Rational (Conscious) Experience

Net Promoter does not tell

h Emotional Signature Rational Experience

(Conscious experience)

you what to do about it

Emotional (Subconscious) Experience


Net Promoter Score

Postbank NL (15%)Commerce Bank USA (67%)Australian banks avg -35% (only 1 positive)


The link to value


Emotional Profile


The Sainsbury’s Story | Action

A little background:• Britain's longest-standing major food retailing chain. • Employs over 145,000 people. • Offers over 23,000 products.• Serves over 11 million customers/week in its 500+ stores throughout the UK. / g

Before

• In the late 1980s, the Chairman was

After

• The Chairman was replaced by an a outward looking marketer.

• The worst thing a store manager could do was:

1 b f k

p yinward looking accountant.

• The worst thing a store manager could do was:

1 b k d1. be out of stock

2. be overstocked

1. be overstocked

2. be out of stock

What do you think was the effect of this change?


The Sainsbury’s Story | ReactionSlight Shift – Huge Impact

Shift in Priority Initially a boost in stock price but then a decline

Initially a boost in stock price but then a decline

Cost

Revenue A drop in revenue that lagged behind the decrease in cost

A drop in revenue that lagged behind the decrease in cost

but then a declinebut then a decline

Time

Stock priceInitial boost Decline

Before After

• Supermarkets main value added is that they offer the goods you want in one place.

The shift in priority caused managers to

• How do accountants measure the impact of frustrated customers?

• They don’t because it’s not ‘hard’ data (i e it is not in the past)• The shift in priority caused managers to

prefer to be out of stock to being overstocked

• The priority changed because the costs f k i il d

data (i.e. it is not in the past)

• What happens if customers continue not to find what they are looking for?

• By the time Sainsbury’s recognised of an overstock is easily measured.

• Service levels declined from 99% average to below 90%.

y y gthe problem, customer attrition had gained its own momentum!


Which of these profiles do you think represents Sainsbury’s after the change?

1 21 2

N i T ti lNaive Transactional

3 4

Enlightened Natural


The Journey from Naïve to Natural

0%

32%

0%

60%

8%


N2N Strategic Assessment – Report Samples


N2N Strategic Assessment – Report Samples

SYSTEMS

Best PerformerCompany “XXX”

Index AverageLowest Performer


How a few organisations might fare…


The goal of the customer experience…

Blah, blah, blah ..The point is to deliver a deliberate Blah, blah, blah…..The point is to deliver a deliberate customer experience consistently• Deliberate not accidental• Deliberate not accidental• Consistent not lucky/ unlucky• Emotional not transactional• Emotional not transactional


The Counterintuitive Nature of The Counterintuitive Nature of C t E iC t E iCustomer ExperienceCustomer Experience

Qaalfa DibeehiQaalfa DibeehiVi P id C l i & Th h L d hiVi P id C l i & Th h L d hiVice President, Consulting & Thought LeadershipVice President, Consulting & Thought Leadership

Thank you

© Beyond Philosophy ™ 2001-2009www.beyondphilosophy.com

the counterintuitive nature of customer experience management

Business

customer experience

overall customer experience

customer expectationsacross

customer experienceis

philosophy perspectiveleaders

asignificant reduction

great organisations

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