Senior Director Analyst Gartner
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Transformation
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If service differentiation is a competitive advantage, how do we transform our service experience?

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In order to transform the service experience, customer service and support leaders must take a more dynamic approach to customer engagement. And it will require a significant change in three major components of a service organisation's operating model.

22nd Feb 2021
Senior Director Analyst Gartner
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Most service organisations operate in a reactive manner, placing the burden on customers to find the best channel for resolution, whether it’s to check on the status of a request, conduct a transaction or troubleshoot a repair issue. Unfortunately, this leads to low self-service containment and customer dissatisfaction. 

To combat this, organisations then add more digital channels and increase self-service capabilities. However, adding and integrating more channels increases organisational costs and complexity, with very little improvement on the service experience.

In order to transform the service experience, customer service and support leaders must take a more dynamic approach to customer engagement. What Gartner calls, dynamic customer engagement (DCE) is a strategy that transforms data into insights that enable organisations to deliver differentiated service experiences resulting in optimal outcomes for both the customer and the service organisation.

DCE transforms customer service experiences with the most significant change being the ability to shift from purely reactive to proactive customer service. A Gartner survey of more than 6,000 customers revealed that only 13% reported receiving any type of proactive customer service. However, that same research showed that proactive customer service results in a full point increase in the Net Promoter Score, customer satisfaction score, customer effort score and value enhancement score. 

Shifting from reactive to proactive requires a significant change in three major components of a service organisation's operating model, specifically, technology, people and process.

Component #1: Technology

Many service organisations today have multiple and often competing technologies across business units. In order to deliver proactive engagement, customer service and support leaders must instead implement a common enterprise technology architecture to remove organisational silos and enable a customer-centric verse a company-centric next best action (NBA) programme. This will require many different technologies – which fall into three distinct systems – to realise full maturity and maximise business value:

  • Systems of record — Sources of data available to the organisation through a master data management strategy. This includes first-party data (data that originates within the organisation),  second-party data (from business partners and affiliates) and third-party data (from external sources, such as demographic data, credit history and other marketing data).
  • Systems of intelligence — Applications necessary to transform data into insights through analytics. This includes the applications used by an organisation’s data science team to build models, such as those used to predict calls, identify upsell opportunities or identify customers at risk to cancel or churn.
  • Channels of engagement — Channels used by customers and employees for reactive and proactive communications. This includes websites, mobile apps, email, text messages, customer portals, physical locations, call centres and increasingly AI-powered channels (such as chatbots and intelligent virtual assistants).

Component #2: People

The change in strategy and technology also requires a change in talent and skills. Many organisations are set up with domain-specific experts operating in siloed business units. While some domain-specific experts are necessary, employees must be combined with highly specialised resources operating in concert to achieve organisational goals. 

New talent and skills will be needed in most organisations especially in the area of data management and analytics. This may require hiring new talent to join the organisation and customer service and support leaders will need to work with human resources to evaluate and identify any skills gap and develop a plan to address these gaps.

Component #3: Process

Process is the third key component of the operating model that will need to be adjusted for a more dynamic and proactive approach to customer engagement. Today, siloed efforts focus on delivering specific business unit goals but DCE is about collaborative cross-functional efforts focused on delivering customer-centric solutions to achieve organisational goals. This includes changes to business case planning and prioritisation, and program management and development methodologies.

For example, service organisations will need to utilise both waterfall and agile development methodologies to deliver on the long-term transformation to proactive customer engagement.

Benefits of a transformed service operating model

The changes to the service operating model will enable increased capabilities to deliver dynamic customer experiences. These capabilities include:

  • Proactive engagements — Ability to send an outbound message and/or pre-empt a customer journey during a reactive engagement.
  • Low-effort experiences — Ability to reduce customer effort to engage and complete transactions.
  • Contextual actions — Ability to present relevant, trusted and timely actions and information to customers.
  • Personalised content — Ability to personalise content to the specific customer, increasing his or her willingness to engage.
  • Connected journeys — Ability to orchestrate and connect a customer’s journey across channels, eliminating the need to start over when switching channels.
  • Continuous conversations — Ability to engage customers in a series of communications and NBAs, creating a continuous conversation throughout the customer life cycle.

As service differentiation becomes more than a competitive advantage, customer service and support leaders need to rethink how they approach the service experience. Customer service expectations are increasing, and every interaction is an opportunity to increase loyalty and mitigate disloyalty.

DCE allows service organisations the flexibility to address increasing service expectations and economic impacts while also increasing overall organisational resiliency.

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