Customer Experience Management (CEM) is a term that has been gaining momentum over the last few years. On first hearing, one can perhaps be forgiven for thinking that it smacks of the emperor's new clothes. The very use of the word "experience" can cause the hackles of scepticism to rise. I'm convinced, however, that there is something to it. In fact, more than that - it's a term that goes to the very core of what many organisations are trying to do and one that IT is absolutely key to enabling.
Gartner offers the following definition: " 'Customer Experience' is the customer's perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier's employees, systems, channels, or products." The management of such can perhaps be described as a customer-centric management philosophy where the customer is seen as an individual. It's certainly not a technology.
CEM is being taken seriously. Forrester Research surveyed attitudes to CEM in both the US and Europe. 90 per cent of US companies surveyed described CEM as being "critical" or "very important" to their plans in 2010. 62 per cent of companies in Europe surveyed described CEM's goal for them to be about differentiation against the competition. Implementing CEM is hard though. Half of US organisations surveyed cited a lack of clear CEM strategy and processes as being significant obstacles to improving their customers' experience.
This isn't a management column, so what role, if any, does technology have to play in CEM? Here are four things essential to delivering CEM that a CIO should consider.
Break down information silos
Technology and information silos, whether created over time by different business departments or through mergers and acquisitions, are the bane of a CIO's life. Of course, an end user doesn't care what integration and data transformation headaches might be going on in an organisation, but they do care about the end result. Communications and media companies, for example, face particular problems as they move towards triple and quadruple play such as land line, mobile, broadband and television packages.
Often such offerings straddle multiple different business units and customer information is replicated in different systems. To a customer, a process such as on-boarding can appear disjointed and fragmented. The replacement of underlying systems to address this is usually too disruptive and expensive. Rather, focus should be put on bringing together this information into one place. This could be as simple as providing a portal so a customer service representative can view all relevant customer information on one screen. Alternatively, it could be more sophisticated, by presenting relevant metrics taken from multiple underlying operational systems detailing how many times a customer has accessed a web portal and phoned a telephone helpline together with the value of the product ordered in the last 180 days.
Have a continuous view of process performance
Any process that is non-trivial will have a number of IT systems supporting it. Usually the flow of the transactions through the process will have not been designed a priori but rather will have evolved over time. Business Process Management (BPM) tools may have been used to model processes, but this is likely to be the exception - despite BPM's very strong growth, by some estimates, only five per cent of processes have been modelled using BPM. Obtaining a view over how an end-to-end process is performing is therefore difficult. In a recent survey, commissioned by Progress, 89 per cent of businesses reported that they didn't have the visibility they required. It is though, possible to achieve it. Process flows can be discovered, non-intrusively by using Business Transaction Assurance (BTA) tools that can map IT systems interactions as transactions flow around. When then linked to BPM tools a view can be had of both modelled and non-modelled processes.
The modelling and tracking of process transactions is one thing. It's also necessary to identify issues immediately. Let's face it, no customer experience is going to be enhanced in finding out that an order has an error in it days, or even hours, after it's been submitted. Take an example from the banking sector. A European bank was struggling to prioritise loan, credit-card and mortgage applications because their reporting was not frequent enough. High-value customers, whether individuals or businesses, were not being prioritised early enough to make a material difference as to when their application would be approved. The bank introduced continuous monitoring which enabled business operations staff to prioritise and thus deliver better customer service.
Do customer behaviour analysis
Interacting with customers appropriately is a fundamental requirement of CEM. Presenting a customer with relevant information, whether on a web site, via a text message or some other interaction gives an opportunity to both pique interest in a product or offer but also to undermine the customer experience through the information being perceived as spam. Analysis of customer's past interactions, buying habits, preferences and models of what they are likely to want, as opposed to what the business wants them to want, is therefore imperative. When this behaviour has been analysed, it then needs to be used together with what the customer is actually doing at any particular time.
Use event-based response
As regular readers of this column will know, I'm a big believer in events powering business decisions. Finding out about things as they occur, rather than at some time later, enables action to be taken immediately. Using an event processing approach helps to deliver the right information at the right time. Take another example from the mobile telecoms industry. Conventionally, patterns of subscriber behaviour are analysed and offers deemed to be of interest are sent to subscribers, often, however, several weeks later.
One mobile operator is moving towards a model where an offer is sent immediately after particular subscriber behaviour. For example, a subscriber may start making international phone calls. The telecoms industry may see this as an opportunity to put the user on a different tariff. By sending a text message suggesting this immediately after an international call has been made, rather that, say, a week later, significantly increases the propensity of the user to take interest in, and accept, the offer.
Be more responsive
Using technology to utilise siloed information assets, continuously monitor process performance and understand and react immediately to customer behaviour can all contribute to a better customer experience. It's when these are used together that things can get really interesting such as a company selling foreign exchange to corporates and banks. In response to a request for a quote, prices for foreign exchange can now be quoted on a per customer basis. These are calculated using information about the customer, other prices in the market and a model that describes how competitive the quote should be. The quote is returned to the customer in under a second, together with information about the discount the customer will receive. This provides highly responsive, competitive product quotes that also ensure a margin for the provider.
Technology won't give a firm a CEM strategy, but it's a key enabler of one. Therefore, every firm in a competitive market should be considering how they utilise technology to understand and react to their customers more effectively. This is logically the next step for organisations looking to broaden their focus to not only gain visibility into problems or opportunities but to rapidly respond.
Therefore, it is my view that these organisations will increasingly look for vendors that offer a knowledgeable and comprehensive approach to building this next generation of critical business applications.
About the author:
Dr Giles Nelson is Deputy Chief Technology Officer at Progress Software.
As Deputy Chief Technology Officer, Giles Nelson is responsible for technology strategy and corporate development at Progress Software. This encompasses setting a vision for Progress products and shaping the company's acquisition strategy. A significant part of his role is evangelising the company's vision to the company's customers, partners and key industry watchers.