Today, companies talk a great deal about customer experience. That makes sense. In the age of the customer, they need to focus more on customer preferences and less on their own agendas. But understanding the voice of the customer requires companies to be able to measure that customer's voice.
Historically, companies have used various tools to measure quality of service, including somewhat-outmoded techniques, such as fishbone diagrams, and quality monitoring forms. Today, companies focus on mining customer feedback to evaluate internal processes and quality. They need more insight into the customer perspective – and in real time.
At the same time, the focus on customer experience can usher in new tactics that are trendy rather than helpful. Companies can easily get caught up in new initiatives that bill themselves as a cure-all for business woes. Some of these efforts have long-term potential, while others are fleeting. Customer experience -- and measuring that experience through customer experience analytics -- represents the latest trend. But is this initiative just another "flavor of the month," or is it here to stay?
Let's look at some past initiatives, and then consider the potential of new efforts, such as customer experience analytics:
Total quality management (TQM)
Total quality management (TQM), which had its heyday during the late 1980s, is a management philosophy focused on broad efforts across the organization to continuously improve quality of products and services offered to customers. The focus was ensuring that internal quality requirements were fulfilled. It originated in manufacturing and has since been adapted for other industries. TQM never used intelligence to close key customer service quality gaps that could have been identified via the voice of customer feedback.
TQM is a noble effort, but it's also a no-brainer: Quality in all aspects of the business is something every employee should focus on every day. Methods that should be common practice hardly need a special label.
During the 1990s, re-engineering became a trend and focused on re-inventing an entire business process to improve key measures such as cost, service and speed. Re-engineering was supposed to be radical, prompting companies to discard the old rules.
In practice, however, re-engineering became a cost reduction exercise for many organizations. Re-engineering could also create more pain points, as it often drove centralization of work processes that in some cases improved speed, but in other cases built in an additional bureaucracy. Tools such as business analytics were not yet available to understand how changes in one area of the business affected others. As a result, organizations, in their effort to promote efficiency and cut costs, did not fully understand how the changes they made affected customer experience.
Emerging during the 2000s, customer satisfaction measures how products and services meet customer expectations. Customer satisfaction enlists the voice of the customer to help companies address areas for improvement and indicate problems.
While measuring customer satisfaction can be valuable, is it a true indicator of future customer behavior? Customer satisfaction surveys require customers to recall their interactions, but other activities may slant a customer's survey responses. Finally, customer satisfaction surveys often measure a focused area, such as a customer's interaction with a contact center, while sometimes missing the issue that prompted a customer to reach out to the contact center in the first place.
If companies aim to use customer satisfaction surveys as forecasters for future customer behavior, survey questions need to be more holistic, provide real-time feedback and address the entire customer journey -- not just examine service-level interactions.
Since 2010, companies have strived to bolster efforts to improve the customer experience. Today, they try to evaluate all the steps in the customer journey -- from prospect to full-fledged customer -- that characterize the customer-company relationship. Customer experience starts with the customer's awareness of what a company sells, continues through the purchase phase and includes follow-up interactions, typically through a contact center, a company website or social media platforms.
Analyzing the customer experience through tools such as speech analytics, customer journey mapping and business intelligence forces an organization to view itself in real time from a customer's perspective. Gathering feedback directly from customers helps companies gauge the effectiveness of products and services and gives them cues as to which initiatives are doing well and which ones need improvement.
Measuring customer experience
Interpreting customer experience requires a high-level of self-reflection. Individual business units cannot be evaluated in isolation; instead, companies need to analyze different areas of the organization and how they affect one another. While the aforementioned initiatives similarly aimed to improve quality and reduce cost, customer experience differs in that it is focused on an external, rather than an internal perspective.
Let's consider some tools that are being used to understand customer experience:
Speech analytics: Speech analytics software focuses on the "voice of the customer." Recorded phone calls between customer service representatives and customers can be analyzed for key words to identify problems, either in products or in the effectiveness of service. Speech analytics gives companies a window on customer sentiment and satisfaction instantly rather than having to wait for them to complete and return surveys. When combined with agent training, speech analytics can improve first-call resolution and reduce wait times, saving the company money. It can also be used to gauge agent performance to further assist in training and coaching of employees.
For example, if a group of calls contain the same words or phrases -- such as "I want to cancel" -- companies can address the root cause of the issue with those customers. If companies can determine the causes of common problems, they can fix them more rapidly and save themselves the headache -- not to mention money -- incurred by future customer complaints.
Customer journey mapping: Customer journey mapping enables organizations to analyze where pain points occur in a customer-company relationship as customers move through the sales or service funnel. Maps or diagrams illustrate the various points at which customers engage with a company. These maps have large-scale ranges, evaluating every customer touchpoint; from not being aware of the company or product to purchasing it, sharing their experiences and, hopefully, becoming a repeat buyer. Other journey maps can focus on a particular customer-company interaction.
Companies strive to quickly identify and fix problems that emerge throughout the customer journey so that they don't escalate and weigh contact centers down with call traffic. By determining which common problems pop up in which stages of the customer journey, companies hope to catch problems before they become embarrassing issues that can damage the brand.
Business intelligence (BI): Business intelligence allows organizations to analyze and understand how one unit may influence customer behavior and impact other areas. Companies employing BI can, through various applications, tools and methodologies, gather internal and external information and present it to executives and managers to help them make data-driven decisions.
BI, for example, can link information such as the location where a customer purchased a product with where customers are when they call contact centers. In this way, an organization can determine how effective physical stores are at educating customers about products and services.
If managed properly, customer experience won't be another fleeting business initiative but will instead become a regular way of doing business and a key forecaster of customer behavior that can drive customer loyalty.
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