How to simplify your CX transformation journey into three basic building blocks
During a customer experience transformation, if companies have a clear view of the essential building blocks and reference them throughout the transformation journey, they can make better decisions and coordinate activities more efficiently. But how do you identify those building blocks?
Few debate the importance of customer experience, but companies still have trouble transforming their organisations to capture all the advantages of excellent customer experience.
While approaches vary based on the maturity of the business and the customer opportunities, the most successful companies address three building blocks: A) aligning on a strong aspiration; B) implementing a disciplined process for transformation; and C) building up the enablers to make it all work.
A holistic approach to customer experience transformation
A true customer-centric transformation often entails rethinking a business or even the business model itself, which is the only way the transformation can achieve its full impact and remain sustainable.
A fundamental change of mind-set focusing on the customer, along with operational and IT improvements, can generate a 20 to 30% uplift in customer satisfaction, a 10 to 20% improvement in employee satisfaction, and economic gains ranging from 20 to 50% of the cost base addressed in the various journeys. There is no silver bullet - only a holistic approach will succeed, and that relies heavily on all of the building blocks in the diagram below:
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Of course, a simple framework doesn’t mean that the transformation isn’t complex. Any transformation effort requires leadership, focus, investment, and commitment. But we’ve found that when companies have a clear view of the building blocks and reference them throughout the transformation journey, they make better decisions and coordinate activities more efficiently.
With this in mind, I’ve spoken to some of our own leaders at McKinsey & Partners to get their take on approaching customer experience transformation and collected them here for you to consider how they might be applied in your organisation.
Customer experience transformation: Three major components
Any successful customer experience programme must contain several components. According to Nicolas Maechler, partner at McKinsey: “The first is top-management buy-in on a customer-centric strategy to ensure a shared vision. Secondly, core customer journeys must be identified and transformed by redesigning and digitising them. Finally, enable the transformation by establishing a permanent, live feedback loop from customers to as many employees as possible.” (Building blocks A, B and C.)
The starting point for a transformation
As partner Fransje van der Marel explains, “Customer experience is an excellent starting point for a digital transformation because it places the emphasis on creating a happy customer and will also solve a lot of inherent inefficiencies.”
Keys to success include engaging with your customer early and throughout the process and employing cross-functional teams to tap into the organisation’s experiences and expertise. A focus on value and bottom-line value delivery is also critical, as is the ability to create broad excitement within the organisation. (Building block C.)
A design perspective
Designing new experiences helps employees connect with the value they are creating for customers, brings cross-functional teams together, and serves as a shared language that allows different departments to communicate more easily.
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“Designers can use role playing and physical prototypes to see what the experience feels like for the customers and to rapidly test new ideas,” says senior partner Stefan Moritz. “Future customer experiences can also be designed to create a “North Star” to guide the organisation on its goals-based journey.” (Building block B.)
Common themes in customer experience transformations
In the words of senior partner Tjark Freundt, “Effective customer experience transformations require a clear vision and a customer-centric, ambitious articulation of goals.”
Metrics are crucial for understanding customer needs and performance levels, but leaders also need to take a holistic view of the end-to-end customer experience. A typical transformation can take two to three years and relies on attracting or upskilling talent to sustain the continuous improvement necessary for success. (Building blocks A and C.)
Customer experience measurement; three questions, three answers
“A customer experience measurement system typically resides at the core of a transformation,” explains partner Ralph Breuer. “It translates sometimes confusing data to explain what’s driving customer satisfaction and shows how to increase it on a daily basis.”
A customer experience measurement system links business impact (increased revenue, cost savings) to all the elements that drive customer-satisfaction improvements. A successful measurement system is journey-based, should involve a substantial part of the organisation, and can’t be cobbled together from existing systems and outdated mind-sets. (Building block C.)
Time to transform
So, you can see here how a simple framework can be used to plan for customer experience transformation, and where the components for getting such a project underway. It is a complex, multi-engagement, but planned well there can quick and impactful wins along the way.
The three building blocks of this framework can help distil the complex challenge of customer-experience transformation, facilitating the journey and in turn improving decision making and coordination. If customer experience is not central to the development of your business already, then its time to start looking seriously at where your transformation will begin.
A member of the leadership team of McKinsey's European Marketing & Sales Practice, Harald leads the global customer experience service line and the collaboration with the Disney Institute, and co-leads our EPNG work in retail and...