Companies hoping to transform their business into a customer-centric organization need to view customer service not as an event but as a series of interconnected processes, and to make their IT plans accordingly, according to one Gartner analyst.
Customer service progresses through six phases: detection, preparation, transaction, measurement, understanding and improvement, according to a recent research note written by Michael Maoz, vice president and distinguished analyst with the Stamford, Conn.-based research firm. Having someone, or better yet a team of people, take the perspective of customers and their progression through these processes is a difficult but rewarding endeavor.
In fact, the customer experience is beginning to replace CRM in many places. AMR Research, for example, no longer has a CRM research group but studies customer management, and vendors are beginning to position themselves as providing customer experience management technology.
"CRM has been kicked and tossed and beaten; customer experience seems to have better resonance," Maoz said. "You can manage to sub-optimize any one piece of a series of processes and still get it all wrong. What this is talking about is let's look at it a little more from the customer's experience. Let's see how they consider the overall set of experiences."
Companies have been optimizing individual customer contact channels for years and have become adept at serving their customers individually. A customer may get good service on a Web site, then a chat session and finally a phone call, but if he has to repeat information and gets different responses at each channel, the overall experience is broken, Maoz said.
Part of the problem is that segments of the organization have taken responsibility for individual channels. The answer, Maoz suggests, is to form a team focused on the customer that touches all the parts of the organization that a customer touches -- billing, marketing, logistics, call center, partners.
"By taking a holistic approach and creating a customer experience team, you can begin looking at what a customer expects and compare it to a nonlinear or broken set of processes from the inside," Maoz said. "The idea is to change the way organizations are structured."
Another vital part of the customer experience team? Customers. Companies no longer need to rely on focus groups, surveys or follow-up calls. Particularly with large, business-to-consumer organizations, online communities with the participation of the business are providing real insight into processes and performance, he said. Companies such as Hallmark, CharlesSchwabb and HP -- with PhotoSpace, its online community of photo-taking moms -- are doing this right, according to Maoz.
But though the team is important and the concept solid, he said, it takes more than just assembling a group. It needs leadership, and that doesn't necessarily mean giving someone an empty title of chief customer officer.
"If you don't have C-level approval and budget -- meaning [that] you're being measured on it, given a bonus on it, your salary is measured on it -- then it's just lip service," Maoz said. "Generally, someone at the top says, 'Enough talk about this customer experience, our marketing is failing us.'"
It's a vital step because learning from customers and changing processes to serve them means more time and money -- a departure from the traditional focus on efficiencies and quarterly profits.
"You'd be a fool to try and change customer processes at the expense of higher service costs unless you have someone with higher authority," Maoz said.
For many organizations, IT has done as much as it can to optimize channels and purchase hardware and software. When the CFO and CTO of a company get together and decide to put an end to thinking of service as an event, things change.
And things are changing. Companies with lots of customer touch points are evolving to this, Maoz said -- investment banks in particular. Telecoms selling packages instead of bundled minutes, insurance companies, service companies and hotel chains are all getting into it, though it's far from widespread adoption.
"If you look at all businesses, maybe three to five percent truly are engaged in trying to improve the customer experience from a holistic experience," Maoz said. "Most other companies are far away from that."
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