Company silos and culture continue to blight customer experience programmes

Organisational silos continue to be the curse of customer experience leadership, with the latest research from MyCustomer revealing that half of all CX leaders view it as a significant obstacle to success. 

Published in collaboration with the European Customer Experience Organization (ECXO), the research report – Customer Experience Leadership In An Uncertain Economy – asked 143 senior customer experience leaders about what they believe will be the biggest obstacles to the success of their CX programmes in the next 18 months.

As with the previous two studies - conducted in 2020 and 2022 - organisational silos was comfortably the most commonly cited obstacle (reported by 50% of respondents), with company culture the next biggest challenge, cited by 40%). 

MyCustomer

So why are organisational silos such a stubborn stumbling block for customer experience programmes and what can be done about it?

A lack of communication and collaboration

“Silos are embedded into the blueprint of how modern organisations are set up to function. The abiding assumption is that overall productivity is greater when teams are focused on a limited number of responsibilities,” notes Martin Hill-Wilson, founder of Brainfood Consulting. 

Susanne Fries-Palm, chief customer officer at Yonder, and a founding member and senior advisor of ECXO, agrees that silos are commonplace in organisations today. 

“Often departments within an organisation work in silos with their own goals and priorities. This can lead to a lack of communication and collaboration. In addition, I see conflicting objectives and also missing coordination between the departments as a result of silo-thinking or working. Today there are still many companies that steer the organisation purely by objectives, which - I think -  is a relatively old-fashioned way, it was developed in the 1950s by Peter Drucker and it is unfortunately often short term oriented. Especially when shareholder interests in the background focus more on short term than long term profit it becomes difficult. That means if these objectives are not carefully coordinated there is a high risk in not working towards a common goal, as CX might be, but working against each other. CX is not a topic for CX leaders, it is a topic for the whole company and all must work together.”

Shaun Smith, founder of Smith+Co, refers to the importance of the ‘triad power’ - the three primary departments of marketing, operations (customer service) and HR working together around a common agenda for CX success. But this is easier said than done.

“Marketing is responsible for understanding what customers value and then framing a brand promise and proposition to speak to this. Then communicating this to customers and the organisation,” he explains. “Operations is responsible for ensuring that the policies and procedures are aligned with the proposition and that employees are managed and motivated to deliver it. HR is responsible for recruiting, training and rewarding employees appropriately and ensuring the employee experience is aligned with the brand and customer experience. 

“When the c-suite are aligned around this ’triad power’ and the CEO is leading the effort, you get great results. The job of the CX director is to act as facilitator/programme manager providing the strategy and the plan to support it.”

However, many organisations aren’t structured in a way to support this, he suggests.  

“The problem with having a dedicated CX department which reports into marketing or operations, etc is that it is easy for the initiative to become ‘buried' in the organisation, tactical and fail to have the engagement of the key stakeholders.  

“If HR is not actively involved they will often start their own EVP or employee experience initiative which is divorced from the brand proposition and customer experience. Employees then get mixed messages and the culture becomes dysfunctional or self-serving. A recent example was that one major telecoms firm in the UK came bottom of the rankings in terms of customer satisfaction  and was heavily criticised in the press for very long call-centre wait times, but in the very same week the HR director announced a major programme of expenditure to offer 'free gender transition therapy' in order to provide “support and allyship to people from marginalised communities”. Now that may have been an appropriate initiative but communicating it in that way that week may not have been the best way to deal with the perception of uncaring customer service.”

So what can be done about this problem?

“Breaking silos means sharing more of what they know which could mean they might feel more insecure regarding the speciality and unique skills they have,” suggests Ray Gerber, distinguished product XM scientist at Qualtrics.

“I also think that metrics today are silo-based and any attempt to improve customer centricity which impacts the metrics in certain areas could quickly get push-back. Brands needs to start by defining customer centric metrics where no individual department is measured in a silo.”

Martin Hill-Wilson adds: “The most common way out of this as seen to date is the trend for agile, diverse, cross functional teamwork. When it evolves from project based assignments to becoming a permanent way of managing performance, the cultural impact of silos is replaced by an expanded collective mindset. Especially when end to end journeys are used as context for the way this type of teamwork defines and approaches challenges. Of course, single platform technologies that enable this way of working help embed the habit.” 

Company culture

Elsewhere, culture is a similarly stubborn issue that is undermining customer experience management - consistently appearing high up on the list of CX leader challenges. 

“If the company culture is not supporting customer-centricity and continuous improvement, it can be difficult to implement a successful CX programme, says Fries-Palm. “With customer-centric I mean not only value the customer, but also placing customer needs in the focus of decision-making. That means, if the company culture does not support this, the culture needs to be changed, which for sure is quite a challenging process and it requires strong commitment from all employees. And of course it is easier when the top management supports it. We all know how difficult it is to focus on a change when our manager does work in the same direction.”

Gerber is similarly unsurprised that culture continues to be an issue. 

“Culture is generally driven by a CEO/COO who is primarily focused on revenue generation and cost savings,” he notes. “A culture of customer-centricity could be perceived as adding costs (which is not true) and maybe slowing down achieving revenue targets. It is much easier to push products down customers' throats than to be patient and allowing customers to purchase when and how they want.”

Ricardo Saltz Gulko, founder of the ECXO, adds: “Culture is an issue among many global organisations, but companies are continuously trying to improve. However, it is easier said than done. Developing buy-in and generating adoption of your culture can be very challenging. Also, as we all know, changes do not happen overnight. It is a continuous effort and a proper change management initiative by itself. Culture change and adoption are not programmes with an ending; they are ongoing efforts in your organisation.” 

Sylvia Lohr, principal marketing manager DACH/Benelux/CEE, at Nuance Communications, and co-founder of ECXO, believes that resolving the issues around culture and silos could actually be connected.

“I think that both operations and culture are being very much influenced by company structure and shouldn’t be seen and managed as silos. Even more, operations and culture can’t be seen separately but are impacting each other. Plus the fact that businesses are more focused on customers as an income resource, while tending to forget their own people who are the spearhead to their customers. 

“Traditionally, decisions to change operations/processes are being made first hand and top-down. And only as second step culture and with it people are being considered. But nowadays, well, for a couple of years, a shift to transformation and agility is permanently part of any communications, however it’s a talk about, less practically installed.

In this, I see a gap between perception and reality which causes fear and uncertainty against new structures. Optimising and changing CX means also optimising and changing internal processes - technology and people. Technology is often seen as dangerous for peoples’ work environments, instead of being positioned as a supporting new resource for each individual in customer teams. 

“To overcome these obstacles, it is highly recommended to link operations with the culture component by increasing communications, picking up people at the very beginning of such a transformation journey and enabling them to serve their customers even better. Only then, a real CX can be created and will be worshipped by the customers.”

Ultimately, company culture and organisational structure remain the two biggest obstacles to CX success because they are arguably the most difficult to change - and particularly so for customer experience leaders who often have limited influence. And unless this changes, these problems will continue to dominate these studies for years to come. 

“These obstacles still exist because they are often deeply embedded in the way organisations are structured and the way they operate, and changing them is a significant challenge,” concludes Fries-Palm. “However, I feel that addressing these issues is critical for the success of a CX programme and organisations need to make a concerted effort to break down silos, foster a customer-centric culture, and prioritise CX in order to succeed.”

Download the research report for more insights into customer experience leaders.