April 25, 2011
Every year in January, Forrester publishes its Customer Experience Index (CxPi), which reports how customers rate their interactions with major companies. We learn a lot from studying leaders in various industries — like USAA, which was the top credit card provider, top bank, and top insurance provider this year.
Last week, we published a follow-up report, which examined companies that raised their CxPi scores by at least five points year over year. Among others, these brands included Aetna (up six points), Citi’s credit card business (up 12 points), Charter Communications (up 20 points as an ISP and up seven points as a TV service provider), and Office Depot (up nine points). Our goal was to discover what, if anything, these firms did to earn their improvements.
And as it turned out, their big gains came as a result of major efforts.
Our research uncovered customer experience initiatives that fell into two buckets. The first bucket was business process re-engineering. Efforts here included creating or enhancing voice of the customer programs, measuring customer experience consistently across the enterprise, and changing incentive programs to reward customer-centric behavior by employees.
But perhaps the biggest impact came from upgrading the customer experience governance process at the enterprise level. For example, Aetna transformed its decentralized part-time customer experience task force into a full-time enterprise customer experience team. Cox Communications made an even more drastic change, consolidating any function with material customer interactions into one group led by a new senior vice president of customer operations.
This is far from the first time we’ve seen the positive impact of creating or strengthening a centralized customer experience team. In previous studies, we’ve noted that companies with centralized teams are less likely to report common obstacles to success like lack of a clear customer experience strategy and lack of budget for improvement projects. That’s not surprising. Megan Burns, the author of the CxPi report, likes to put it this way: When someone is clearly in charge, things are more likely to get done.
The second bucket of customer experience initiatives that drove improvements included projects designed to fix or enhance specific experiences. These major tactical initiatives ranged from upgrading digital experiences provided by websites and apps to streamlining nondigital channels like call centers and retail stores.
Some of the biggest movers created good experiences by finding and eliminating the causes of bad experiences. For example, Citigroup discovered that 90% of the times when customers of the credit card side of the business accidentally phone the call center for the bank side of the business, they're calling with one of 10 fairly simple questions. Rather than force bank-side agents to transfer the call, the company armed them with answers to those top 10 credit card questions. Cox Communications put more power into the hands of its call center agents, too, with a tool that has helped diagnose and resolve 10% more problems over the phone without having to send a technician out to a customer's home.
Meanwhile, Office Depot took an approach that focused on upgrading a fundamental aspect of customer experience: usefulness. It did this by overhauling product assortments and merchandising in the stores to better meet customer needs. For example, it upped the focus on fashionable items to address feedback from female shoppers. It also streamlined its supply chain to improve “in stock” status for key products. The net result: More of what customers wanted was available when they wanted it.
Here’s some of what we concluded at the end of our report:
- Companies without a centralized enterprise-level customer experience team should start one and give it some real influence. So many good things flow from that point on.
- Identifying and fixing customer pain points is a great place to start improvement efforts, especially for companies in the early phases of customer experience maturity. Don’t start out by trying to delight customers, start out by not annoying them.
- If you have a solid voice of the customer program in place, it’s easier to find the pain points. Customers often don’t know the root cause of their problems — but they know when they’re not happy, and they’ll tell you if you listen appropriately.
As always, I look forward to your comments.