Sunday, March 9, 2014

Which Department has Greater Impact on Customer Experience

Organization needs to think in terms of building cross-functional business capabilities to WOW customers.

In majority of traditional businesses structured with functional silos at industrial age, customer service or experience seems to be only related to a few customer-facing departments such as marketing or customer service. When more and more organizations are at the journey of digital transformation for becoming more customer-centric, which department has greater impact on customer experience? What are best practices in making these functions to understand each other and work together? And what’re the best strategy and tactics to optimizing customer experience.

 Each function has a different and entirely valid role to play in delivering on a customer experience strategy. What is more important is that it is a committed whole of business strategy and then each of the functional expertise areas understand clearly the part they play in this and specific responsibilities to deliver, with all KPIs, all key staff measures, clear objectives and actions required, part of board reporting, part of management speak, then regular management reporting and meetings will review progress of the objectives-reported by the responsible functional areas of each initiative or project. Best practice of the collaborative working relationships - between all functions or any other expertise, is surely about clear responsibilities, regular, honest and timely communication.

To build the customer-centric business, organization needs to think in terms of building business capabilities. A silo and disconnected organization could not deliver value effectively to its customers. A business capability is an ability of an organization to perform a particular type of work and may involve resources such as people with particular skills and knowledge, the effective process, defined practices, operating facilities, tools, software and equipment which work together for a defined purpose. Basically, a business capability encapsulates all intangible or tangible resources, functional or cross-functional processes to perform a certain value added activity for customers. Use business capability modeling techniques to align strategy with value proposition and to the business capabilities of the organization and ultimately creating a capability driven roadmap for transforming enterprise from silo organizations to customer centric organization

Experience is moved by everybody in the organization, It might be useful to the discussion to break the customer experience into parts and different stages. Customer experience comes from all touch points, yet organizations are structured by departments and it hinders company’s ability to create value. All departments have impact on customer experience, regardless if they realize this, or not and the important scenarios of delivering great experience to customers may include the following steps:
1) To craft the holistic customer experience digital strategy (Senior Management)
2) To know what is the experience customers are willing to pay for (marketing)
3) To sell the products/service to the potential customers (Sales)
4) How to digitalize touch points in customer experience, researching, proposing and implementing the tools that contribute to deliver outstanding customer experience (IT)
5) Ability to align all people around the customer experience strategy (HR)
6) Budget assignment (Finance)….
7) Customer retention (Contact Center/Customer Service)
As the customer goes through these “phases”, there is multiple touch points in which the customer’s experience is built and value is created. These customer touch points can potentially be with up to almost all areas in the organization: Sales, Marketing, Operations, Customer Service, Finance, IT. Analysis and improvement of these touch points can involve radical transformations in organization, end-to-end processes and systems, in order to build the right business capability.

VALUE DRIVERS with 3C: Close, Clear, Can. Value is very situational and contextual. So, “values” associated with a one product may be different for another product for the same customer segment. since they reflect what customer care about - The WOW factor. Values are only important to businesses if they generate VALUE to customers. When we know as an enterprise what our customers value, we can take it as our own VALUES and focus on maturing business capabilities in order to drive what's valuable to the customers through! So the titles and responsibilities of departments in a business are less important than the customer focused vision that drives the business. It drives through the silo issue and ensures that all structures, processes and strategy align around an excellent customer experience and a resultant profitable business. NPS is a good KPI to measure value. However what is the most important is to connect NPS with a question to customers WHY? Combination of quantitative NPS and qualitative WHY, brings really powerful results. 

 Change management is in many cases totally related to Customer Experience! In fact, any performance improvement process, whether related to customer experience or employee experience or whatever else, in order to be executed, requires at least basic change management practices. Senior management and talent management inspire change, looks for alliances inside the organization, push for customer-centric culture” ... One common element in all these areas involved in creating the customer experience is people, and how people interact with customers and how proactively and promptly they solve their needs, the effective change management effort can convert many departments from rather inward-looking organizations to having an external focus and customer-centric approach.

The organization needs a holistic customer-centric approach encompassing all functions, the strategy should be from the top (Executives) and permeate the entire organization. In order to build a customer-centric business, it takes cross-functional collaboration and cohesive business capabilities. The strong brand needs to well orchestrate processes and resources; all come out from strategy and are supported by talent employees. It is every department’s business, either you are at vertical function or operate horizontally. The purpose of a business is to create value and manage people, who are customers and employees. Companies are in the people business. 


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