2017 - Join the CX revolution or become irrelevant

The digital revolution is driving change through every business sector. Long-established playbooks are being torn up, distribution models overturned and customers are exhibiting new and different behaviours.

This upheaval is accelerating at speed and no sector is immune, from finance to travel or waste management to engineering. The winners so far are those businesses that are data-led and customer experience driven – they are armed with micro-knowledge of their customers’ behaviours and needs and use data analytics, cloud computing, platform technology and mobile devices to supercharge their operations, processes and delivery of great customer experiences (CX).

Until now, traditional businesses have been figuring out whether the newcomers like Airbnb, Uber, Spotify and Netflix are fly-by-nights or real disruptors to the status quo. In 2017 this pondering will have to stop and the hard work of digital transformation needs to begin, otherwise businesses will be forced into competing on price alone, their margins will come under unsustainable pressure and they will become commodity offerings rather than deeply embedded in people’s day-to-day lives.

Next year companies will have to pick up the baton and bring a digital lens to bear on all their component parts. They must ensure that all elements of the organisation are harnessed in the service of developing a memorable CX.

Digital transformation will provide the capability to ride consecutive waves of change, whether the company is operating in a B2C or B2B environment. Putting the customer at the heart of everything a business does is a challenge to which companies need to pay more than lip-service. Many organisations have burnt through massive budgets only to find they have failed to differentiate themselves sufficiently from competitors; while they may have tweaked some processes, found savings and introduced new tech, they have not baked the necessary digital mind-set for success into the company.

Some of the barriers to change are identified in the exclusive independent research BIO commissioned in September this year. Censuswide polled 200 B2B senior digital, IT, technology and marketing managers on their attitudes in regard to digital transformation.

The biggest barrier to digital change cited by the panel is lack of resources (22%), followed by company culture (17%) with lack of digital skills and resistance to change at board level ranked equal third (15%).

This illustrates the need to have total C-suite backing for digitally-driven, customer-focused change because that is the only way sufficient budget will be made available. It also puts pressure on those tasked with driving transformation to produce some ‘quick wins’.

The poll identified Operations (36%), Customer Experience (18%) and Innovation (15%) as the areas of a business having the greatest potential to deliver an early payback following a digital overhaul, so it makes sense to focus on these areas initially before digitising departments like Finance or HR.

Ultimately, successful digital transformation rests on three key pillars– technology, operations and the already-highlighted culture. All business processes are connected and unless an organisation can shift its culture to one of open-mindedness, agility and positivity towards change, then employees will not engage with the new technology that improves CX and stay on top of updates and improvements.

The hardest task for any business is to evolve its culture to one that is comfortable with constant change, understands the benefits of baking digital into the entire organisation and where continuous improvement is the norm.

When quizzed on the business sectors leading the way in digital transformation and working towards improved CX, the panel of decision-makers overwhelmingly ranked the IT & Telecoms top of a presented list (62%), followed by Professional Services (11%) and Sales, Media and Marketing (8%). Travel & Transport and Education were the sectors seen as lagging behind in pursuing a transformation agenda.

Conversely, IT & Telecoms topped the presented list of industries most in need of a digital overhaul followed by Professional Services – possibly suggesting that people prioritise the services provided by these sectors in their lives and have heightened expectations of what they deliver.

There are two important trends I think will have an impact on the business development of CX in 2017.

First, the poster children of digital disruption are not immune from being disrupted themselves. This will occur with increasing frequency next year as their technology-based offerings are cloned, copied and/or improved by new challengers or the big players in their sub-sectors; look at how Facebook is copying Snapchat features like messages that auto-destruct and Snapchat stories within messenger. Another example is Pokemon Go – the combination of geo-location and augmented reality provided an irresistible fun experience but the initial thrill has evaporated and other brands will now take these elements and improve on them.

Alternatively, look what is happening to the fortunes of hardware manufacturers of ‘hot’ devices such as Pebble, Go-Pro or Fitbit – they no longer have their finger on the pulse of what people want or expect. In a world with ever-shortening product development cycles, constant innovation backed by speed to market is essential to keep customers loyal and engaged.

The other trend to watch in 2017 is the growing integration of people’s private and workplace behaviour. More and more millennials are entering employment and this cohort are used to smooth, frictionless experiences, whether ordering pizza or checking their bank account, and bring these expectations to their business dealings and workplace interactions.

They want provision of a digital experience in any role and the ability to use the digital tools and devices that feature in their everyday lives (including mobiles, collaborative software and easy-to-use dashboards). Hence the adoption of collaborative workplace tools like Slack. A business that cannot keep pace with the expectations of its own workforce is unlikely to meet its customers’ needs and wants.

One prediction I can make with certainty is that customers will continue to demand the highest performance from their brand interactions, products and services next year. A third of the decision-makers quizzed said that will need outside help to achieve full digital transformation but this will be an investment that pays off. Those businesses that tackle the barriers to delivering a superlative CX head-on will be the winners.