Value can be defined in various ways when analyzing organizational programs and initiatives. But make no mistake when it comes to assessing customer experience (CX) efforts – value is the ability to impact the bottom line in a tangible way.
That impact can include, for example, driving revenue, reducing costs by increasing efficiency and/or mitigating risks. The methods can vary, but the results must be quantifiable outcomes that can be reflected on the company’s financial reports.
And depending on whether you are of the glass half full or glass half empty mindset, the job of the CX professional is either filled with unparalleled opportunity or fraught with new challenges. Let’s start with the “empty glass” approach.
The early days of CX found teams fighting to have a voice in the room. Programs and budgets were often a small slice of the dollars allocated to marketing, sales or operations teams. Now, in most cases, CX is no longer under those protective umbrellas. CX is often standing alone and fighting for its own share of the budget pie.
The spotlight is shining brighter than ever. If the CX value story can’t be effectively communicated and demonstrated on the bottom line, programs run the risk of being cut back or eliminated.
But that bright light – and the experience gained through previous CX efforts – provides the opportunity to shine. While the glare might be most intense during budget/evaluation periods, proving the value of CX is an ongoing effort. In other words, take advantage by telling your story and telling it often.
Demonstrating the value of CX throughout the year can help make the case for funding at budget time a much easier proposition.
Following the process
A simplified version of the CX value chain might be helpful to understanding where efforts to tell those needed stories either stall or fail to get off the ground. The value matrix includes:
- Gathering insights from the data
- Turning the insights into action steps
- Actions driving improvement in key performance indicators (KPIs)
- Stronger KPI performance producing bottom line increases
One of the biggest challenges to assessing CX value is striving to tell a perfect story rather than telling a story. The CX team, particularly if it is new or less experienced, is sometimes afraid of losing credibility internally if its assumptions or calculations are imperfect.
Another way of putting it is paralysis by analysis. In the quest to justify the confidence the leadership team has put into the CX program, the team members become extra cautious and wary of making any missteps or mistakes. That restraint, however, can lead to missed opportunities.
This challenge closely relates to connecting KPI improvements to the bottom line.
Challenge number two is similar to the perfection syndrome, but slightly different. It involves having a focus on the end story but failing to break the road to that ultimate conclusion into the proper components or phases.
The longer it takes to tell a story (or a part of that story), the more the returns diminish in value. In today’s fast-paced business world, insights are gained in real time and actions required to address those insights are closer to real time than ever before. See below for practical steps to overcome this obstacle.
This challenge is tied to step two of the value chain – connecting insights to action steps.
A third challenge focuses on trying to associate action steps with KPI improvements. It can include three related questions:
- Are we doing the right things – a question of strategy?
- Are we doing the right things well enough or at scale – related to internal execution?
- Are we doing the right things and talking about them internally and externally – in other words, are our communication efforts effective enough?
Crafting the solutions
The good news is that solutions to these challenges can be quickly enacted and implemented. Small steps can foster a path from inaction to calculated progress.
Challenge: Striving for perfection
Solution: Make the switch from demonstrating hesitation to gaining curiosity. Use the insights you have gained as a conversation starter to gather more information.
Consider this example: Let’s say every customer support telephone call comes at an average cost of an estimated $400. The belief is that steering some of those calls to a frequently asked questions document on the web site or some other form of self-service will reduce the cost of those interactions to 40 cents each.
The “let’s seek perfection” mindset would likely lead to worrying about the precise accuracy of those numbers. There could be a fear that the financial team in your organization would question their validity.
But what is the result if the true numbers turn out to be $500 and $1.80 instead of the projected $400 and 40 cents? You still have substantial savings and a strong financial gain for your company. The lesson: Don’t be paralyzed out of fear of not being absolutely correct.
In baseball teams, it’s having the freedom to take your cuts while at the plate. If you don’t swing the bat – or, in this case, don’t start that conversation – you won’t achieve the ultimate success.
Challenge: Not taking a phased approach to get to the end story
Solution: Adopt a bias toward taking action. Ask questions. Be curious. Learn the information you need to advance from initial insights to final conclusions.
Internally, a good step toward gaining additional data is to ask colleagues in other departments several simple questions: How can I help you? What might this initiative do to assist you with your work?
Others within your organization need to ultimately be on board. By asking questions and truly listening, you can build necessary bridges. Take the information you learn and work it into the value story – and tell that story to other departments. A little proactivity that connects those within the organization and offers solutions can turn the CX team into heroes.
Talking to customers can also prove valuable. A small pilot program can continue to move the initiative forward. The pilot can then be evaluated and expanded to add to the momentum.
In the baseball scenario, it’s swinging the bat and going for the singles and doubles that add up to runs scored instead of waiting for the perfect pitch and swinging for the fences.
Challenge: Ensuring excellence in strategy, execution and communication are in place
Solution: Using root cause analysis to answer your questions and evaluate your progress.
If KPIs have not moved in the right direction or as quickly as anticipated, ask why. Both internal colleagues and external customers can be queried: Were you aware we were taking these actions? Have you seen a difference? What changes have you noticed?
Yes, leadership will eventually be looking at the big picture and whether improvements have taken place at scale. But transformations often operate with a snowball effect – beginning with one, five or 15 instances. Seeing positive examples enhances credibility and buy-in.
When that customer success story is a 1-on-1 interaction, it can truly resonate within the company. An example: A $2 million a year customer is found to be at risk through your collected insights. Positive actions that save the customer relationship and potentially grow it are the best example of CX providing true value.
In conclusion, don’t fall into the “he who hesitates is lost” category. Demonstrate a bias toward being proactive. Utilized the resources around you to gain additional information. Celebrate the progress you are making along the way. And when the eventual backward steps occur, treat it as an opportunity to learn more and move forward.