Report: The State of Customer Experience Management, 2013

We just published a Temkin Group report, The State of CX Management, 2013. The research shows where large companies are along their customer experience journeys. Here’s the executive summary:

We surveyed more than 200 large companies and found an abundance of Customer Experience (CX) ambition and activity. Most companies have a CX executive leading the charge, significant CX activities being coordinated by a central team, and a staff of six to 10 full-time CX professionals. Using Temkin Group’s CX competency assessment, we found that only six percent of companies have reached the highest two levels of customer experience maturity as firms struggle the most to master Employee Engagement and Compelling Brand Values. When compared with CX Laggards, CX Leaders have stronger financial results, more CX ambition, more CX leadership, and they are more successful with their employee engagement efforts. Executives in companies with stronger CX competencies also focus more on delighting customers and less on cutting costs.

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Here are some of the findings from the research:

• While only eight percent of companies believe that they are leading their industries in CX today, 62% have goals to be the best within three years
• Sixty-one percent of respondents have a senior executive in charge of the company’s overall CX efforts and 71%  have a centralized CX group
• The median firm in our study has six to 10 full time CX employees
• Seven out of ten respondents identified “other competing priorities” as a significant obstacle to their CX efforts
• Only six percent of the companies that completed our CX Competency and Maturity Assessment have made it to the top two levels of maturity, Align and Embed
• We compared companies with leading CX efforts with other firms and found that they have better financial performance, more centralized CX activities, better employee engagement, stronger employee engagement, and more management attention to corporate culture

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The bottom line: Most companies remain in the early stages of CX maturity

Report: Best Practices in B2B Customer Experience

We just published a Temkin Group report, Best Practices in B2B Customer Experience. Here’s the executive summary:

Customer experience is gaining more attention within business-to-business (B2B) organizations. Rightfully so—customer experience drives loyalty with business customers. At the same time, clients and prospects, who increasingly compare business interactions with their personal consumer experiences, are raising the expectations of B2B relationships. While our research has shown that most B2Bs are still mastering the basics, our interviews with 28 companies uncovered best practices for building a more client-oriented mindset through closed-loop voice of the customer programs, customer journey maps, and virtual client advisory boards. Using the customer insights they collect, forward-thinking B2B organizations are becoming more client-centric in how they develop new business, create account plans, and proactively provide support (or intervene when service breakdowns occur). To sustain superior customer experience, B2B firms must master four competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness.

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The report identifies many best practices across two areas:

• Building a client-oriented mindset. Organizations have a natural tendency to operate from an internal perspective, focusing on the needs of their functional silos more than on their clients. To offset this tendency, B2B firms need to build repeatable and systematic processes for gathering, analyzing, and taking action on customer insights. The report identifies best practices in the following areas:
  • Develop Closed-Loop Voice of the Client (VoC) Programs. Having a reliable flow of customer insights across the organization is critical to driving customer-centric actions.
  • Use Journey Maps to Better Understand Clients’ Needs. To better understand how clients see their experiences, B2B organizations can use a tool known as customer journey mapping.
  • Tap Into Virtual Client Advisory Boards. Client advisory boards (CAB) and councils provide the opportunity to acquire more insight into customer needs and expectations.
• Building client-centric relationship management. Today, account management functions tend to be oriented around sales generation and firefighting. To build stronger, longer-term ties with clients, Temkin Group expects that B2B firms will head towards a more client-centric model of account management that uses client insights throughout the relationship management continuum. The report identifies best practices in the following areas:
  • Account-Level Experience Reporting. To acquire, retain, and grow B2B relationships, account managers need to understand what’s working and not working for each of their clients.
  • Insightful Business Development. B2B organizations that gather and use the right customer insights during this early stage will create a differentiated experience from the start of the relationship
  • Collaborative Account Planning. By taking a structured and collaborative approach to developing in-depth account plans, companies can tap into their enterprise knowledge.
  • Proactive Intervention and Support. B2B organizations need to use customer insights and feedback from account managers to intervene in service experiences gone wrong as quickly as possible with well-defined, robust recovery procedures.

The report provides a plethora of specific practices in these areas from companies such as Becker and Poliakoff, CDW, Cisco, Citrix, Dell, Enterasys, Equinix, Genworth Financial, Lithium, Lynden, Philadelphia Insurance Companies, Oracle, Salesforce.com, SanDisk, Stream Global, Verint, and VMware.

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The bottom line: B2B companies need more customer-centric enterprise relationships

 

Report: The Four Customer Experience Core Competencies

Temkin Group just published an update to the report that defines one of our fundamental frameworks, The Four Customer Experience Core Competencies. This report lays out the building blocks for customer experience success. This topic is so important that we’re giving this report away for free. Here’s the executive summary:

Research shows that customer experience is highly correlated with loyalty. While any company can improve portions of its customer experience, it takes more than a few superficial changes to create lasting differentiation. Organizations that want to become customer experience leaders need to master four customer experience competencies: Purposeful Leadership, Employee Engagement, Compelling Brand Values, and Customer Connectedness. To gauge your progress, actively use Temkin Group’s Customer Experience Competency and Maturity Assessment. This assessment will identify areas of strength and weakness in your CX efforts as well as identify your progress along six stages of CX maturity: Ignore  Explore, Mobilize, Operationalize, Align, and Embed.

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Here’s how I describe the four CX Competencies:

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The bottom line: It’s time to improve your CX competencies

 

Report: Lessons in CX Excellence

We just published a Temkin Group report, Lessons in CX Excellence. This 127 page report provides a rich set of best practices and a glimpse into the customer experience efforts of 11 companies that were finalists in Temkin Group’s 2012 Customer Experience Excellence Awards. Here’s the executive summary:

The following 11 organizations are finalists in Temkin Group’s 2012 Customer Experience Excellence Awards: Blue Cross Blue Shield of Michigan, Bombardier Aerospace, Citrix, EMC, Fidelity Investments, JetBlue Airways, Microsoft, Oklahoma City Thunder, Oracle, Safelite AutoGlass, and Sovereign Assurance NZ. This document provides highlights of their customer experience efforts and best practices across the four customer experience competencies: Purposeful leadership, compelling brand values, employee engagement,  and customer connectedness. The report also includes the finalists’ detailed nomination forms.

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Here are excerpts of our description from each of the finalists:

• In just 17 months, Blue Cross Blue Shield of Michigan assembled its customer experience team and leveraged a variety of insights and data to devise a comprehensive strategy to “Find and Fix” near-term opportunities and “Transform” the organization to be customer-centric at its core.
• Bombardier Aerospace drives continuous improvement through its multi-faceted Amazing Customer Experience (ACE) initiative. Customer feedback is essential to ACE and is gathered through a variety of channels including surveys, customer forums, and Bombardier’s Executive Listening Program.
• Citrix places an emphasis on giving customers a voice in its product roadmap and building a user-centered culture in order to continuously improve its products, services, and experiences. Through the Design Matters initiative, Citrix helps its employees rethink core business processes with a focus on customer needs.
• EMC has a Total Customer Experience (TCE) program with a mission to enable business growth through improvements based on a customer-focused, data-driven strategy. The program provides ways for customers, partners, and EMC field personnel to provide feedback on their experiences, and measures customer quality in every interaction.
• Founded on the core value “The Customer Is Always First,” Fidelity Investments has a well-established, well-rounded program that delivers enterprise-wide results. The program is comprised of four integrated elements: Voice of Customer & Associate, End-to-End Process Improvement, Culture & Communications, and Measurement & Rewards.
• The Customer Insight (CI) team at JetBlue Airways provides the business with a multi-faceted view of its customers through feedback from surveys, text analytics, social media monitoring, and third party benchmarking. The CI team also has a program in place to address all unsolicited customer feedback that is received regardless of source through its Customer Retention Program.
• Microsoft believes that the better it is at building a culture of accountability, listening and responding to customers, simplifying offerings, and innovating based on customer feedback, the stronger its Customer and Partner Experience (CPE) will be.
• “Create Repeat Guests Profitably” is the mission of the Guest Relations team of the Oklahoma City Thunder. The team uses various fan feedback platforms to gather feedback including email, text message, telephone, written submissions, and social media, all of which are promoted on the team’s website and during in-game announcements.
• Oracle drives consistent customer experience activities across all regions and lines of business through a structured framework and standardized approach to monitoring the customer experience: Listen, Respond, Collaborate for Customer Success. The portfolio of feedback tools includes transactional and product surveys, relationship surveys, customer advisory boards, user experience labs, and independent user groups.
• On the company’s path back from bankruptcy, Safelite AutoGlass CEO Tom Feeney set a goal in 2008 to double business in four years by 1) putting Safelite’s people first by focusing on talent development and employee engagement and 2) going above and beyond to delight every customer.
• Sovereign Assurance of New Zealand’s strategy is to create customer engagement and advocacy through effortless experiences, with a program of initiatives around four key levers: customers front and center, stickier relationships, maximize touch points, and focus on value.

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The bottom line: There’s a lot to learn from these excellent CX efforts

Michael’s Stores Links CX And Marketing

Last month I met Paula Puleo, CMO of Michael’s Stores, at a SAS event in Orlando. She gave a presentation that I really enjoyed, describing activities at the arts and crafts retailer that blends marketing with customer experience.

The importance of customer experience comes out loud and clear in what Puleo presented as the three elements of Michael’s corporate mission:

• Inspires and enables consumers to experience creativity
• Leads industry growth and innovation
• Creates a fun and rewarding place to work that fosters meaningful connections with our communities

I was really impressed with Puleo’s presentation, so I caught up with her after the event. In her presentation, Puleo listed her six marketing priorities. Here are some of the additional details that she provided for each of them:

• Live The Brand: Puleo talked about trying to foster connections with customers and associates. The company runs events like craft cruises and craft days at baseball stadiums (they’ve had them at Arizona Diamondbacks and Texas Rangers games and expect to expand to other sporting venues). Puleo also pointed to Michael’s participation in the Festival of the Masters at the Walt Disney World. The goal is to bring crafts to venues that are more family oriented. She said that these activities bring a level of inspiration to all of their messages.
• Real Time/Face Time = The New Prime Time. Puleo talked about having a dialogue with customers. Michael’s uses a dedicated Social media team to keep Twitter and Facebook alive. Each store has dedicated customer experience managers that aren’t focused on other store operations. Puleo says that these employees make the environment happy, friendly, and fresh and she called them “our people-people.”
• Make the private brand not so private. Michael’s has a large private brand business, which provides strong financial benefits. Rather than positioning these store brands as boring alternatives, Michael’s wants to celebrate them and make them a strong value proposition. So the company introduced its product designers to customers. Influential bloggers, for instance, are periodically invited to spend the day with product designers. Connecting customers and influential crafts bloggers with product designers make the private brands come to life and creates what Puleo called a “playground for customer co-creation.”
• Compete in the trenches. Puleo said that they need to compete at a local level. So corporate marketing helps the stores understand who their customers are and any local competitive threats.The company is investing in deeper data insights to better understand customers and provide the stores with even more insights. The corporate marketing team also creates experiential events and demos that can be used in the stores.
• Remove the angst. Puleo talked about finding what’s in the belly of your customers. if you remove that angst then you will eventually sell them something. She understands that shoppers are anxious about spending, so they lead with value. She also recognizes that Michaels customers have angst about having quality family time. That’s why Michael’s came up with the idea for The Knack, which is a site with simple ideas for family crafts projects.
• What works. Puleo discusses the importance of measurement and having good KPIs in place. She works closely with her finance partners to understand what’s working and what’s not, to measure the ROI of the marketing spend.

Puleo also discussed Michael’s loyalty program.They’ve just started offering experiential benefits for Gold customers (that spend $250+ per year). In about 275 of its stores, Michael’s invites its top customers to events with stores designers and celebrities in the crafts world. In St. Louis they had an event with The Crochet Dude and in Dallas they had a contest where customers pitched their projects to Puleo, Michael’s chief designer Joe Pearson, and “rock stars” like the Double Stitch Twins. Puleo says that “access” is the currency that they try to give to good clients; it’s all about surprise and delight.

I asked Puleo about what’s next. She recognizes that many of their customers come to a Michael’s store because they have to come – to get materials for a kids project or to buy a widget. She wants to inspire customers into coming into the stores because they want to. Her goal is to get everyone, even non-customers, to realize that they have some talent and creativity and have them think about coming to Michael’s to express it.

The bottom line: Michael’s sells products, but it markets the love of arts & crafts

CX Insights From Marriott And JetBlue

I recently spoke at the Customer Experience Strategies Summit in Toronto. While I was there, I was able to catch a few of the other speakers. I really enjoyed hearing from the Marriott and JetBlue speakers. Both companies did very well in the 2011 Temkin Experience Ratings; Marriott was the top rated hotel chain and JetBlue was the second rated airline (behind Southwest). Here are some of the interesting details that they shared:

Scott Allison, VP of Canadian Operations, Marriott:

• Allison shared this great comment: “culture trumps brand.” Marriott links its strategy as a company with its strategy as en employer. Bill Marriott still visits a lot of hotels and when he does, he first goes to employee areas like employee entrances and break rooms. Employees are also trained on what makes their brand special.
• Hotel general managers need to hit targets for both customer experience and employee satisfaction to get their bonuses.
• Something goes wrong, even if it’s a small thing, during about one-quarter of stays — so hotels need to be good at recovery. That’s why the Ritz Carlton empowers associates to spend up to $1,000 per day per guest to improve someone’s stay. The staff reviews guest situations at the beginning of every day, they call it “Stand Up” at Marriott and “Line Up” at the Ritz.

Vicky Stennes, VP of Inflight Experience, JetBlue:

• Net Promoter Score (NPS) is one of the key measures that the company uses. It also uses J. D. Power which breaks measurements into “people-related” and “non people-related” categories.
• A couple of years ago, the company noticed a slip in its “people-related” scores so it started a program called “Culture is Service” (CIS). [Note: CIS was discussed in the CEO's letter to shareholders in JetBlue's 2010 Annual Report]. As part of CIS, more than 1,000 “crew members” (across the organization) went through training focused on three areas: Inform: Educate everyone on JetBlue’s current state of service, the measurements that it tracks, and share insights on how crew member behaviors affect customer experience; Engage: Elicit an open dialogue with real-time cross-functional problem solving; and Inspire: Give them a sense of the concept of unexpected moments and recognize the great work of crew members over the company’s first 10 years of operations.
• JetBlue sees success of the CIS program because of an improvement in employee NPS scores of training attendees.
• Moving ahead, they are looking to add a few things to the CIS training: cross-functional design sessions and education on linking NPS to specific behaviors and to revenue.
• Stennes shared data that showed correlation between pilot in-flight communications and NPS. They use this data to show pilots that the way they communicate with passengers plays an important role in passenger loyalty.
• The company also tracks a “Net Helpfulness Score” along with NPS for each flight. They will start using these scores to define scores for crews across their different flights.
• Stennes also shared some great data: Every 5 promoters leads to 2 new customers and every 16 detractors leads to the loss of 1 customer. A promoter is worth $33 extra dollars ($27 from referrals and $6 from loyalty) to JetBlue while a detractor is worth $104 less than average. One point change in JetBlue’s NPS is worth $5 to $8 million.

The bottom line: Great brands spend a lot of time focusing on their people

Can Cigna Deliver On Promise To Get Personal?

Cigna recently started an advertising push around its new brand promise:

Cigna supports and nurtures the unique strengths of each customer to help them achieve their full potential.

I caught up with Ingrid Lindberg, Cigna’s customer experience officer, to find out if this was just a “marketing pitch” or if the company is really prepared to deliver on this promise. Here’s some of what she told me:

• This campaign is part of  a journey that started in 2008 when the company started a major push to improve its customer experience. According to Lindberg “We started to walk before we started to talk.”
• The campaign is part of Cigna’s goal to make experiences more personal for customers. Lindberg talks about her customer experience mantra: Make it easy, make it helpful, make it personal. Here’s how she describes the connection: “You have to be easy and helpful every time, earn the trust and relationship with customers in order to earn the right to help people live a better life. Without relationship and trust, you don’t have the right to interact at that level.”
• Lindberg discussed the level of engagement of employees, saying “If you don’t have your employees engaged, then you don’t have the right to do anything.”
• The company has pushed to eliminate jargon from all of its communications – internally and externally — in a program called “The Words We Use.” She shared data from a recent survey: 86% of employees were aware of that program and 75% were using the “correct words” almost all the time. The company has a great site describing its simplification efforts.
• Lindberg feels that Cigna really delivers on the promise when customers get on the phone with someone from Cigna’s clinical team. She told me: “Satisfaction and health of the customer goes way up when they connect with a nurse.”

My take: Health plans like Cigna have a long way to go before many consumers will trust them enough to establish a strong relationship; no matter what promises the companies make. As I’ve said in the past, companies don’t own their brands. True brands are an asset that are jointly owned by organizations and their customers… and it’s a fragile relationship. Great brands are made in three steps:

1. Making promises. Companies need to be explicit about the purpose of their organization which translates into promises that they make to customers.
2. Embracing promises. It’s nearly impossible to keep a promise that you don’t know about, so everyone in an organization needs to understand the customer promises.
3. Keeping promises. Companies need to make sure that they live up to their promises during every interaction in every channel.

If Cigna can’t deliver on some of the basic needs of customers, then this campaign will turn out to be nothing more than an “empty promise.” Lindberg has a great view on this, saying that they try and build trust one person at a time. In this industry, that’s probably the best mindset.

The bottom line: It’s very hard to build a relationship without trust

Your Company Does Not Own Its Brand

I’ve been discussing brands a lot with my clients lately. Without a strong brand to guide them, customer experience efforts can wander aimlessly. That’s why “compelling brand values” is one of the four customer experience core competencies.

As I’ve said before, a true brand is:

The fabric that aligns all employees with customers in the pursuit of a common cause

There’s a very important implication of my definition: Companies don’t own their brands. Let me say that in another way: You don’t own your own brand.

True brands are an asset that are jointly owned by organizations and their customers… and it’s a fragile relationship. Even if your brand represents something today, there’s no guarantee that it will continue to be perceived in the same way or have the same impact in the future.

So how do you build true brands? With promises. Brand building is based on three ingredients…

1. Making promises. Companies need to be explicit about the purpose of their organization which translates into promises that they make to customers.
2. Embracing promises. It’s nearly impossible to keep a promise that you don’t know about, so everyone in an organization needs to understand the customer promises.
3. Keeping promises. Companies need to make sure that they live up to their promises during every interaction in every channel.

The bottom line: Make, embrace, and keep your promises

Even Walmart Needs To Reassert Its Brand

Walmart recently decided that it couldn’t allow dollar stores like Dollar General and Family Dollar to erode the giant retailer’s low-price positioning. While Walmart was focussing on competing with Target, these dollar stores were building up share with low income consumers. So Walmart is reasserting its “Everyday Low Price” mantra and pushing suppliers for even lower price points in every product category.

My take: This is a great example of “Compelling Brand Values” which is one of the four customer experience core competencies. As an introduction to this competency, I like to share this “edited” quote from Howard Shultz:

Great companies not only stand for something, but they operate in a manner in which their employees consistently deliver on their brand promises. At a high level, this requires three things:

1. A clear definition of your brand and its promises
2. A shared understanding of your brand across your employees
3. An operating model that supports and reinforces the fulfilling of your brand promises

As this Walmart case demonstrates, it’s very easy to lose sight of your brand. While Walmart would never be mistaken as a high-priced retailer, its focus on competing with Target allowed it to stray away from its goal of being the low-price leader.

A small drift in your brand can cause myriads of inconsistent decisions within your company and create opportunities for competitors to takeover your previously controlled market position.

That’s why every company should reassess its brand every 18-24 months. This effort should assess the following questions:

• What does the executive team think the brand currently stands for?
• What does the executive team think the brand should stand for?
• What do employees think the brand stands for?
• To what degree have employees embraced the brand?
• What do customers think the brand stands for?
• To what degree does the brand resonate with customers?

The bottom line: Never take your brand for granted

Customer Experience Highlights From Monte Carlo

As I mentioned in the previous post, I enjoyed the Customer Experience Exchange 2010 in Monte Carlo earlier this week. I couldn’t go to all of the sessions, but here are highlights from some of the speakers that I saw:

• Andrew Gerrie, Co-Founder and CEO at Lush. Andrew followed me on stage and dropped a bath bomb into a clear tub of water and we watched it fizz. I still remember the first Lush store that I went into. The salesperson came over with a bucket of water and dropped some of those bombs into it and water splashed on to the floor. She didn’t seem to mind. That was an experience! Andrew explained how those in-store demonstrations force employees to have conversations with customers. It also helps them attract employees who really like Lush products. Lush invests a lot in training its employees so that they can answer a wide range of questions about skin care; even beyond what their products can do. He also shared pictures from the company’s “Naked Products Campaign” where employees wear nothing but an apron to highlight the fact that Lush products are “naked” of preservatives and complex packaging. Click here to see some images on Google of that campaign.
• Ingrid Lindberg, Chief Experience Officer at CIGNA. It’s always great to see my friend Ingrid. Although I keep close tabs on what she’s been up to at CIGNA, it was great to hear her talk about CIGNA’s customer experience story. They’ve done so many good things to make CIGNA more customer centric; including eliminating words that are confusing to customers (there’s a lot of them in the US healthcare system), making the call center accessible 24×7, and improving the usability of the website. These efforts haven’t just increased loyalty, they’ve also improved medical outcomes for their customers. Proof positive that good customer experience saves lives I’ll be doing a case study on CIGNA — look for it in a few weeks.
• Moira Dorsey, VP & Research Director at Forrester. I really enjoyed catching up with Moira, another friend who I sat next to for several years at Forrester. Her speech discussed how the future of online customer experience can be described with the acronym CARS: Customized, Aggregated, Relevant, and Social. To showcase what the future will be like, she highlighted some existing practices, noting this quote from the science fiction writer, William Gibson: “The future is already here – it’s just not very evenly distributed.”
• Simon Glynn, Senior Partner at Lippincott. Simon’s presentation introduced a model of brands based on two dimensions: Authentic Stories (story power) and Inspiring Experiences (experience power). He showed how using these  in a 2×2 diagram leads to 4 quadrants of brands: Unattached (low on stories and experiences), Myths (high on stories, low on experiences), Tribal (low on stories, high on experiences), and Legends (high on stories and experiences). It turns out that Legends (like Amazon.com and O2) have an average 5-year growth rate of 8% compared to -4% for Unattached brands (like BT and Aldi).
• Rob Siefker, Senior Manager Customer Loyalty at Zappos. After having interviewed CEO Tony Hsieh a few years ago, I’ve always been a fan of the Zappos story. The culture at Zappos is almost cult-like. And they can keep it that way, because as Rob described: It’s harder to get a job at Zappos than to get into Harvard; they only hire 1% of applicants. The interview process is tuned to find people who will buy-in to the culture; a couple of the questions they ask are “what would your theme song be, and why?” and “On a scale from 1 to 10, how weird are you?” The company replaced its standard reviews with cultural reviews, making it clear that it measures its managers in 4 key areas: driving the culture, inspiring new ideas and creative thinking, helping employees find their calling and reach their peak, and providing recognition.
• Graham Webster, Director of Customer Experience at Telefonica O2 Europe. Graham discussed how the company’s vision helps engage employees in “something bigger than themselves” and how Telefonica is trying to go beyond satisfaction to turn customers into FANS. I loved when he said “If we look after our customers, they will take care of our brand. Customers complain, but FANS forgive.” The company researched the value of enthusiastic customers compared to detractors and found that they: have half the churn rate, deliver 9% more in average revenue per user, and generate less than one-fifth of the claims. Graham described a three-step evolutionary path: Random Experience to Predictable Experience to Branded Experience. What are the elements of a Branded Experience? Consistent, Intentional, Differentiated, Valuable, and Emotional Relationship.
• Roger Sant, VP Research Solutions at Maritz. Roger talked about “making your customers fall in love with you.” He showcased results from a survey of 1,200 consumers that looked at emotional and functional attributes for banks, supermarkets, and mobile phones. The research pointed to three levels of relationship between a customer and the brand: Unfulfilled, Functionally Satisfied, and Emotionally Connected. Here’s the comparison of top box scores between Unfulfilled customers and Emotionally Connected customers: retention (9% to 58%), recommend (3% to 49%), and cross-sell (7% to 41%).
• Frederico Cesconi, Director Of Business Intelligence at Cablecom. Frederico shared the companies model which looks at customer experience as a series of layers (going from inside to the outside): Systems, Processes, Touchpoints, Interactions, Customer, and Experience. The company focuses on 4 core processes: sales to activation, service assurance, incident handling, and billing to cash. He showed a wonderful report that they call a “Survival Analysis.” It charted churn rate against the number of negative incidents that a customer had run into — highlighting the cost of a bad experience. He also highlighted the need for customer feedback. Their internal metrics showed 83% first call resolution, but when they measured it with customers it turned out to be only 58%.

The bottom line: Monaco hosted the customer experience grand prix this week.

Improve “Compelling Brand Values” In 2011

As I mentioned in the post Build Customer Experience Competencies In 2011, I’m highlighting each of the four customer experience competencies as part of my effort to help companies put together their 2011 plans. Today’s post looks at…

Compelling Brand Values: Are your brand attributes driving decisions about how you treat customers?

As firms optimize left-brain management techniques for squeezing out additional profits, they’ve lost something very important — their raison d’être; many have even lost their soul. True brands are more than just marketing slogans; they are:

The fabric that aligns all employees with customers in the pursuit of a common cause.

The importance of a clear brand is captured in this (somewhat altered) quote by Howard Shultz:

Your brand is a set of promises that you make to customers that are kept (or unkept) by your employees. So this core competence is about understanding those promises and making sure that you live up to them during every interaction. As you can see from the results below of 140 companies who took Temkin Group’s Customer Experience Competency Assessment, most companies aren’t setup to keep those promises.

Companies need to make their brands more concrete and get the organization to interpret it into specific requirements. JetBlue, for instance, translated its “Jetitude” brand into five specific behaviors for its front line employees:

• Be in Blue always
• Be personal
• Be the answer
• Be engaging
• Be thankful to every customer

Here are some other posts that you may want to check out:

• Sizzler Embraces Customer Experience Competencies
• A Branding (Not) Lesson From KFC
• Starbucks Brews A Comeback With Purpose
• Customer Experience And The Zen Of Brands
• CMOs: Start Building (Real) Loyalty
• Brands Are Dying; Deal With It
• Marketing Lessons From An Ex-Marine
• Wells Fargo Improves Communications With Ethnography
• My First 8 Steps As A New CMO
• Ford (Finally) Turns Employees Into Brand Ambassadors
• Lessons From Miller (Not So) Genuine Draft
• The 6 Gaps Between Intentions And Reality
• Chase Can’t Advertise Its Way To Customer Friendliness
• Firms Need Some Soul Searching

The bottom line: Your brand is too important to leave to chance.

Top 10 Customer Experience Incompetencies

First of all, for all of the literary purist, I have to admit that “incompetencies” does not seem to be an actual word in the dictionary — but it fit so well that I decided to use it anyway.

I was combing through the results from the Temkin Group Customer Experience Competency Assessment that we administered to 140 companies in May and realized that it would be interesting to share the areas where companies most often fail, or as I like to call them, The Top 10 Customer Experience Incompetencies:

It’s no surprise that the top incompetency is around brands. All too often, companies “offload” their brand to marketing and advertising organizations. But “true brands” should capture the minds and souls of ALL employees. It’s an organization’s raison d’être. As I’ve said in the past:

True brands are more than just marketing slogans, they’re the fabric that aligns all employees with customers in the pursuit of a common cause.

You can get more details about this data in a couple of Temkin Group reports:

• The Current State Of Customer Experience
• Profiling Customer Experience Leaders

The bottom line: Do you know your customer experience strengths and weaknesses?

Sizzler Embraces Customer Experience Competencies

I just read a great article called Kerry Kramp Keeps Sizzler Relevant that discusses how Kerry Kramp, CEO of Sizzler, did a complete makeover of the company. What makes it so interesting is that Kramp embraced all four core customer experience competencies. Here are a few excerpts from the article that showcase each competency:

Purposeful Leadership:

“Leaders have to be directly engaged in the business to the point where they can really understand that the decisions they make are affecting the business — the employees, the profitability as well as the guests. You can’t lead from a corner office. You’ve got to lead from being out there where the business is actually done.”

The measuring stick was long-term success through customer satisfaction. Kramp didn’t want employees taking drastic measures to earn extra profit this quarter if it wouldn’t align with the company’s core in 50 years.

Compelling Brand Values:

“The value-to-what-you-got equation was a little bit off,” Kramp says. “So it began a course of discovery to try to understand what really made Sizzler tick — not so much where the direction had been in the past as much as where the guests wanted Sizzler to be.

“It was to try to understand the uniqueness of this 50-year-old company,” Kramp says. “Where it had been and, really more so, where everybody wanted it to be and how to make it relevant to the consumers that we would need to be attracting in this new world order with the economy changed the way it has.”

Employee Engagement:

Gauging what employees need to do their jobs should be ongoing and continually balanced with customer feedback. Kramp regularly tours stores to ask whether employees have tools to connect with customers, based on their own perceptions of what they think patrons want.

“All of a sudden, whether you’re the cashier, the dishwasher or the server, you knew the food,” he says. “You knew what ingredients were in it, you knew why we did what we did. If you know that the ladle’s supposed to be upright and it’s not, you stop and make sure that the ladle’s upright. The employees began to take real ownership of the way that things were done.”

Customer Connectedness:

“From the guest side, first it was to really understand what was important to them,” he says. “It was looking at: How do the guests want to use us?”

Start by observing as customers use your service and talk to others about it. Kramp watched customers as they examined their 50-plus menu options — often appearing overwhelmed.

“We kept our finger right on the pulse of the guests’ feedback,” Kramp says. “As they gave us indications of what they liked — either verbally or through the product mix, what were they ordering — we kept adapting our business to the direction that they wanted us to head in.”

The bottom line: Are you making customer experience sizzle in your organization?

A Branding (Not) Lesson From KFC

The Association of Kentucky Fried Chicken Franchisees is suing Yum! Brands, owner of the KFC (formerly known as Kentucky Fried Chicken) chain, for control of the advertising direction of the brand. The franchisees do not agree with the parent company’s advertising push towards healthier, grilled chicken.The big push from the franchisees came when Yum Brands! went forward with an advertising campaign called “Unthink KFC.”

My take: Let me start with some (of my) basic definitions:

• Brands: The set of promises that the company explicitly and implicitly makes to its customers about the products, service, and behavior of the company and its employees. Brands represent the fabric that aligns all employees with customers in the pursuit of a common cause. Without a strong brand, companies can quickly go awry (see my post on Starbucks’ brand issues). Why? Because brands define a powerful roadmap for employees to meet a clear set of expectations for customers.
• Branding: The marketing and advertising efforts that communicate and reinforce elements of brands.

With these defintions in mind, the “Unthink KFC” branding campaign seems clearly misguided. What elements of the brand was it reinforcing — that KFC has no brand?!? That leaves KFC with absolutely no purpose. So it’s no surprise that franchisees are upset.

If you want to shift your brand, then you need to use branding to communicate a clear picture of the new brand.

Here are three questions that you should ask (and make sure that you can answer “yes” to) before you launch any branding campaign:

1. Do the branding messages support a brand promise?
2. Do employees buy-in to (and believe in) the branding messages?
3. Do the messages resonate with target customers?

The bottom line: Focus on your brand more than your branding.

Companies Lack Customer Experience Competencies

In a recent research report, we introduced the Four Core Customer Experience Competencies:

• Compelling Brand Values
• Purposeful Leadership
• Employee Engagement
• Customer Connectedness

To help companies identify their strengths and weaknesses across these components, we created a 20 question assessment for this competency model. In recent research report The Current State Of Customer Experience, we examined data from 144 large North American firms that completed the assessment. Here’s some of what we found:

Companies have a long way to go to master all four competencies. They performed the poorest in Compelling Brand Values, where 61% of firms ended up with “poor” or “very poor” ratings. Only 44% of companies ended up with “very good” or “okay” ratings in the highest performing area, Purposeful Leadership.

The results from that assessment also showed that only 3% of these companies are what we call “Customer-Centric Organizations.” That leaves a lot of room for improvement for a lot of companies.

Where is your company on its customer experience journey? Download our competency assessment and use the results to gauge your strengths and weaknesses and as a topic to discuss with your peers.

The bottom line: Companies need to build customer experience competencies.