Category Archives: Culture

2014 State of Customer Experience: Who Are UK’s Leaders And What Can We Learn From Them? (Part 4)

Today’s conversation completes this four part series (part 1, part 2, part 3) centred on Nunwood‘s 2014 UK Analysis report. In this conversation I want to talk about CX improvement.  Specifically, what Nunwood say about what it takes to generate CX improvement.

What Does It Take To Excel At The Customer Experience Game? How Should Your Organisation Go About It?

The authors of the Nunwood report show up for me as being practical folks. They get that there is fine balance between aspiration and pragmatism. Here’s what they write (bolding mine)

For most brands, trying to improve performance simply by emulating John Lewis or First Direct can be counterproductive. Trying to move too quickly, or claiming to be something at odds with reality, can cause credibility and cultural issues. The rapid and sustainable progress of the top brands is the result of long-term, diligent investment. 

… the temptation of many chief executives ….. is to set an expectation … that the organisation will soon resemble a top 10 brand……. Transformational change is seldom less than five year project. In fact, a considerable number of brands ranked 100th to 263rd in this study have publicly held similar goals since 2010 and climbed no more than a few places over this time. Rallying cries must be credible, as well as loud. 

Equally dangerous is the risk of myopically focusing just on the immediate sector competitors, who are often only marginally different in the consumers’ eyes.

Given this what is it that the authors advise?  Here is what they say:

… the question for many brands is not how to get into the top 10 within 12 months, nor is it simply how to be the best of their immediate competitors. Rather, the best dividends come from understanding how to accelerate the rate of customer experience change. 

Which Four Critical Dimensions Do Businesses Need To Master In Order To Accelerate Customer Experience Improvement? 

According to the authors these are the four critical dimensions that businesses need to master to generate sustainable and significant improvements in CX excellence:

  1. A business is mobilised around a common vision;
  2. Customer journeys are mapped and prioritised for change;
  3. Measurement is owned by the frontline and linked to actions; and
  4. Customer experience motivates the employee experience.

As I look at these four critical dimensions it occurs to me that the only one that is ‘easy’ is the first half of the second item on the list: mapping of customer journeys.  Why is this the case? Because you can get a bunch of people together and get them doing customer journey mapping without any disruption to organisational politics or day-to-day operations.  Is that why customer journey mapping, and VoC surveying, are so common place. And action that actually changes anything worth changing so rare?

It occurs to me that it is no easy-simple task to come up with a common vision for the customer experience. And it is a major challenge to get everyone in the business to row in the same direction and in sync with one another. The devil often turns out to be in the detail. The other day I was in a meeting where all the buzzword were there: trusted, easy to do business with, personalisation, consistence…. And everyone was in agreement in this level. The fun came when it came to filling out these empty words with something concrete: What set of practices are ruled out if we are to be trustworthy? What set of practices do we need to embrace to be easy to do business with? What does personalisation actually mean? And so forth.

Take a look at number three on the list: measurement is owned at the front line and linked to actions.  Ask yourself why the call-centre agent on minimum wage, working in factory like conditions, should care, genuinely care, about owning measurement and taking action.  Or flip it and ask yourself who loses out if power moves from head office to the operations, from managers to the people who actually deal with customers?  Furthermore, for this to genuinely occur then something like the practices put forth by Deming (‘drive fear out of the workplace’) and implemented by Toyota (the workers own the design-execution-improvement of the work processes and machinery) need to occur.

Customer experience motivates the employee experience. What does this mean? I take it to mean that you start with figuring out the kind of customer experience that you propose to generate. And use this to figure out which kind of employee experience you need to cause in order for the employees to cause the customer experience you have in mind.  In many businesses, and every service business where the employees touch the customer, it means relaxing control, embracing flexibility and encouraging improvisation-creativity-responsiveness to the situation at hand.  It means treating employees as human beings rather than resources which come in the troublesome form of human being.  It means that power has to move to where the action occurs: the frontline. Who does this threaten? Managers at all levels of the organisation.

Why do I point this out? To reinforce the point that the authors make and which I shared earlier:

Transformational change is seldom less than five year project. In fact, a considerable number of brands ranked 100th to 263rd in this study have publicly held similar goals since 2010 and climbed no more than a few places over this time. Rallying cries must be credible, as well as loud. 

At this point, I ask you this question: what kind of leader and exercise of leadership plants the seeds of transformational change and then nurtures this seeds to fruition?  Can it be the kind of leaders that are commonplace today?  Which leader is going to embark in a journey which involves hardship, including putting one’s reputation and selfhood at stake, and which not yield fruits for at least five years?  It occurs to me only one that it is going to be there in a leadership role for much longer than five years.  Now think of Jeff Bezos at Amazon, or Tony Hsieh of Zappos, Steve Jobs at Apple, Richard Branson at Virgin…

That concludes the conversation on Nunwood’s 2014 UK Analysis report. I hope that I made some contribution to you. Thanks for listening.

 

2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 3)

This conversation continues on from where the earlier one ended. As promised, I have been looking at what Nunwood has to say about certain brands. And find myself in a position to share with you the table that I have put together:

2014 Nunwood CX Leaders Table

 What Does It Take To Be A Customer Experience Excellence  Leader?

Just about everyone I come across business is looking for the answer, the recipe, the formula for turning the ordinary into extraordinary, base metal to gold; Nobody has or makes the time to linger, to think and rethink, to grapple with, experiment, and finally arrive at a home made ‘solution’ to any serious challenge.  So is there a recipe/formula for CX excellence?

If there is, then it is worth taking a look at First Direct as it is in top place in 2014 and has consistently been in the top 10.  Here is what the folks at Nunwood say on the matter (bolding mine):

The First Direct formula is remarkably simple one, yet it has proved difficult to implement in other organisations: remove the barriers between customers and the bank; employ people who want to serve the customer and care about doing a good job; train them intensely and empower them to handle and resolve any issues brought to them by the customer.

What does this look like from a customer perspective? Let’s listen to a First Direct customer:

 I was in Venice when my credit card was refused and it was quite stressful. I phoned First Direct and talked with a patient man with a great sense of humour who spent time talking to me about the holiday, acknowledged this this was a stressful thing to happen and worked methodically to sort thing out. I rarely phone First Direct as I can do almost everything online, but is was so important that when I needed them, they were unfailingly polite, human and ready to treat me as valued customer.

What Is It That Is Missing From The CX Game Of Excellence?

I have read the Nunwood report several times.  And putting this report together with other reports and my lived experience I find myself thinking “There is no rocket science here!” and find myself in agreement with the author of the Nunwood 2014 UK CX report when they say (referring to First Direct) that the formula for CX excellence is a remarkably simple one.  So why is it that so many brands fail to make any meaningful shifts/progress in CX excellence?  Allow me to point at what occurs to me as ‘that which is missing the presence of which makes all the difference’ by sharing a personal story with you.

Earlier this week I was due to be at an important meeting in central London at 10:00.  Seven people were counting on me to be there to ‘chair’ the meeting. I was counting on myself to be there to chair the meeting.  The unexpected occurred on my way to the rail station. I found myself at a stand still on the road for 45 minutes or so. I took the next train – thirty minutes later than I had planned.  This meant that my contingency was gone – everything had to work out just right if I was to make that meeting on time. I arrived at Paddington Station and made my way hurriedly toward the underground. Suddenly, I found my feet sliding, no control, left knee smacks into the hard tile floor, right leg twists awkwardly, the right ankle is in some pain. A helpful gentlemen helps me up. I recover and get that the floor has become an ice rink in some place (food for a future post). I walk slowly, in pain, towards the underground. The up escalator is out of action so I make my way up the stairs – slowly and awkwardly, in pain. I walk for several minutes to the underground entrance. It is closed. I ring both of my colleagues and the client to let them know that I am likely to be late.

Making my way to the taxi rank I notice a long queue and get that if I wait there I will not get to the meeting on time. So I make my way down the stairs and out of Paddington Station. Leaving the station, the rain falls down and I start getting wet. I walk away from Paddington station and towards central London. Why? I get that I have to get far enough away from the station to find an empty taxi. As I am walking I am in pain and mindful that I have to walk carefully on my sprained ankle. After walking for 5 – 10 minutes I find a black cab. I tell the cab driver that he is blessing, a Godsend. We arrive at the client’s office – five minutes after the meeting has started.  What do I find?  The meeting is on the sixth floor and all the lifts are out of service. What do I do? I embrace the pain, walk as mindfully and carefully as I can, and make my way up the stairs to the sixth floor.  I chair the meeting, we do what needs to be done. Just after noon I leave and make my way home as I am in considerable pain.

What was it that allowed me to overcome a series of obstacles and considerable pain to honor my commitment? Absolute commitment to the commitments that I make: playing full out to honor my word.  Ask yourself how often you find that kind of commitment when it comes to the CX realm. Now you have your answer to why it is that so few are CX Excellence Leaders and most are languishing in ‘no mans land’ of averageness.

Enough for today. In the next post I will bring this series of post on the Nunwood 2014 UK CX report to a close.  I wish you a great day and thank you for your listening.

2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 2)

In this post I continue the conversation I started in the last post. The focus of this conversation is the customer experience themes that Nunwood call attention to in their 2014 UK Analysis Report.

What Are The Primary Customer Experience Themes?

I shared one of these customer experience themes with you in the last one. So let’s start on that one and flesh it out.

1. Employees Come First, Customers Come Second

Let’s start this theme with a few paragraphs from the Nunwood report (bolding mine):

These excellent companies realise that value is created commercially and reputationally at the interface between the employee and customer – and it really does happen in that order…… So it is no accident that members of the top 10 also feature highly in the Sunday Times best places to work survey. 

As such, the management lesson for brands aspiring to join the top 10 is clear: those responsible for the employee experience need to be fundamental and genuine partners in building customer experiences. Internal values, behavioural frameworks, competencies, training plans and recruitment principles are fundamental determinants of CX success. 

 

I find myself in full agreement with that which Nunwood articulate. And I acknowledge Nunwood for talking straight and pointing out the Achille’s Heel of just about every Customer initiative (strategy, CX, CRM, customer service) that I have been involved in since 1999.  It continues to be an Achilles Heel because there is no listening for the soft stuff, the human stuff, and certainly not for treating employees right.  That which Nunwood is pointing out has been pointed out before. It even has a name: Service-Profit chain. 

If this is the challenge then what is the ‘solution’ that Nunwood proposes? Let’s listen (bolding mine):

…. HR are seen as playing a role in implementing some customer journeys, but are not genuine partners in the overall strategy. Putting in place a progressive customer governance, which unites marketing, operational and HR professionals, is an important consideration ….

Is that enough? Is it enough just to get the marketing, HR operational folks and let them cook up customer and employee experience excellence? No. Why not? Because technology plays such a critical part. Technology enables or constrains, it facilitates or hinders, it can liberate or enslave. So this is what Nunwood says (bolding mine):

… the CIO will also have representation in this group – as systems and technologies become a vital determinant of the kind of employee and customer experiences that these brands are seeking to forge.

2. The CX Champions Benchmark Themselves Against The Best Organisations In The World

Industries can be meaningful ways of looking at the business world. And  looking at and across the players in a particular bucket, category, can be a useful exercise – if you are financial analyst or the like.  When it comes to excellence in Customer Experience staying in these artificial silos is limiting. Why? Let’s listen to Nunwood (bolding mine):

…. experienced, well-informed consumers have expectations that are no longer industry-specific. A consumer’s experience with Amazon or Appliances Online resets their expectations for all digital experiences. The same for the purchase experience in Lush – for all retail experiences…… the excellent companies are simply following their customers in expanding their field of vision to discover what great looks like and then building that into the experiences they create, fuelling a constant cycle of setting and resetting expectations.

In Which Domains Are The CX Champions Shaping-Setting-Resonating With Customer Expectations?

1. Standing For Something Meaningful and Facilitating Values Based Buying

In an age where ‘God is dead’, an age of nihilism, an age where one can buy just about everything, what is it that many yearn for and cannot be bought? Meaning.  Let’s listen to Nunwood (bolding mine):

Lush and before it Body Shop, are indicative of a shift toward value based buying. The increased expectation that, not only are the products and services great, but they also bring with them some form of attached meaning. Consumers buy into what the firm stands for as much as its products.

Reading that paragraph, I find myself reminded by Simon Sinek. He has been saying pretty much the same thing for a couple of years. And using Apple to illustrate this thought.  If you haven’t watched his TED talk then I urge you to do so.

Just in case you think that meaning and values are only for the likes of Lush or the Body Shop then Nunwood has this ‘warning’ for you (bolding mine):

Marks & Spencers Plan A still strongly resonates with customers, as does the Waitrose green token that apportions local charitable giving. Conversely, Amazon’s reputational issues manifest itself in a slightly weakening …. customer experience. In 2014, customer’s expect ethics as standard. 

2. Ease Through Seamless Omni-Channel Integration

I prefer to do business with those organisations which make it easy for me to do business with them. Turns out my wife and children are very much like me. In fact, I have yet to come across anyone who will admit to preferring doing business with the folks that make it really hard to do business with them.  Here’s what Nunwood says (bolding mine):

John Lewis has set the benchmark for online retailing. Customers are empowered to purchase how they want, in the way that they want – without being pushed to low cost channels. First Direct works seamlessly across online and telephony, as does Appliances Online.

Here, it occurs to me that it is worth pointing out that First Direct is No 1 on the 2014 list of CX Champions. John Lewis is No 2. And Appliances Online is a new entrant at No 6. So making it easy for customers to do business with you through an integrated omni-channel experience makes some impact with/on customers.

3. Making It Easy For Customer To Quench Their Thirst For Useful Information

I have gotten so much into conducting some due diligence before buying that it has become an automatic reflex. Looks like there are many like me. Here is Nunwood again (bolding mine):

…. pre-purchase research has become its own form of entertainment as consumers educate themselves and each other. Amazon has led the way in equipping customers with a vast database of reviews, but Appliances Online has gone one step further, publishing reviews of its performance online, as have FirstDirect. 

If I had to sum all of this up I’d sum it up as follows:

  • Stand for something meaningful – that which resonates with you and your customers;
  • Provide solid products and services and ensure that you pass the Ronseal test;

  • Make it easy for your customers to do business with you by providing them with honest-useful information (that helps them in their buying decisions) and by ‘integrating your people-process-technology’ so as to provide an effortless omni-channel customer experience.

Enough for today. Let’s pick up this conversation in the next post where I propose to focus on highlighting some key features of the 2014 CX Champions.  I wish you a great weekend and thanks for listening.

2014 State of Customer Experience: Who Are UK’s 2014 Leaders And What Can We Learn From Them? (Part 1)

Yesterday, I received one of the few publications I find worth reading. Which publication? The 2014 UK Analysis put together by Nunwood‘s Customer Experience Excellence Centre.  In this series of posts, I will be sharing with you my take on this report and its findings and recommendations.  Let’s start with the dominant themes.

Little Change In The State of Customer Experience Excellence From 2013

The foreword by Marketing Week is full of the kind of exaggeration-hype that goes with much of marketing:

With customer experience now firmly established as the main competitive battleground for ambitious leaders, this is a uniquely rich insight into the best practices needed for success…..

- Mindi Chahal, Features Writer, MarketingWeek

Did you get the clue?  The clue lies in the adjective ambitious as in ‘ambitious leaders’. It turns out that of the 250+ brands surveyed by Nunwood only a very small number are ‘ambitious’. And as such little has improved overall as regards the state of customer experience excellence in the UK.  Which kind of makes me question the claim that customer experience is now firmly established as the main competitive battleground. My experience is that whilst it is talked about, that is pretty much all that happens: talk.

What do the folks at Nunwood say on this matter? This is what they say (bolding is my work):

A minority of brands are shining every brighter …… These examples of brilliance are dimmed by the larger set of brands whose efforts have stalled. Either because they have hit cultural glass ceilings …… or the ambition of their leaders has failed to match the rising expectations of UK consumers … This has meant that across all 263 brands analysed the overall improvement in performance was less than 1%. 

The Biggest Improvement In Customer Experience Excellence Has Occurred In The Financial Services Sector

Which sectors show an improvement? Three of them: financial services, entertainment & leisure, and travel & notes.

Which sectors are stagnant? Three of them: telecommunications, restaurants & food, and non-food retailing.

Which sectors have declined? Two: utilities, and grocery retailing.

Did the financial services sector make the 2.2% improvement due to benevolent-enlightened leadership? Or a new found love of the customer? Or was it because some teeth have been put into a regulator and regulation?  Here is Nunwood’s take on the situation (bolding is my work):

The financial services sector sees the largest improvement in performance …. This is in no small part due to the burning platform created by the government, media and regulators. New FCA-mandated focus on customer outcomes … has led to massive investments and exhaustive leadership attention.

It occurs to me that here we have a clue as to why there has been little or no change in all the other industry sectors. Organisations and the Tops that lead them do not willingly stop screwing their customers and employees. And so switch from the easy and established way of making ‘bad profits’ to doing the hard stuff of generating superior customer value and thus reaping ‘good profits’. This kind of behaviour is arrested and weakened through a combination of effective regulation and sustained media pressure. Which may explain why it is that the utilities sector, which has been the weakest in terms of customer experience excellence has slipped further down the rankings. In my view-experience the Ofgem, the regulator for gas+electricity market, is about as toothless as you can get.

The Same Brands Continue To Shine And Some Shine Less Brightly

By now, I suspect that you may really want to know who the UK’s Customer Experience leaders are. Here are the top 10:

1. First Direct (bank without high street presence)

2. John Lewis (multichannel retailer)

3. QVC (tv based shopping channel)

4. Lush (retailer)

5. Amazon (online retailer)

6. Appliances Online (online retailer of appliances)

7. Waitrose (grocery retailer)

8. Nationwide (building society, financial services)

9. Specsavers (retailer)

10. M+S Simply Food (grocery retailer)

10. Your M+S (retailer)

Here are my take on this Top 10 list in comparison with 2013:

  • Virgin Atlantic and Ocado have dropped out of the Top 10. Virgin is now at number 21, and Ocado just outside the Top 10 at number 12.
  • Appliances Online, Nationwide, and Specsavers are new to the Top 10. This is what Nunwood says about Appliances Online (ao.com):

A clear value proposition wedded to an excellent service culture sets the brand apart.

  • Amazon continues its slide down the rankings here is what Nunwoods says:

Amazon …… continues to slip slightly in the rankings for the third year in a row, as consumers react to declining perceptions of its integrity and the performance of its delivery companies.

  • Waitrose ascends the rankings moving from being number ten (2013) to being number 7 (2014).

  • M+S (both Simply Food, and Your M+S) descend towards the bottom of the Top 10 in 2014.

My personal take is that Your M+S is a retailer in trouble. Management, probably in desperation, are bullying store managers. This then cascades down to the people on the shop flower. And in turn impacts the customer experience. So it will be interesting to see where Your M+S stands in the 2015 rankings.

The Secret of Customer Experience Success: Put Your Customers Second

You may have noticed that I insist on the need for and the critical importance of the human dimension: calling forth and putting into play the best of our humanity in order to orchestrate great relationships and generate great experiences. In short, to create a better world, a world that works for all: employees, suppliers, management, customers, shareholders, and the community.

More than once I have spelled out that the access to great customer experience lies through the folks that actually interact with and serve customers: the people working in the business and especially those who interact with and serve customers on a daily basis.  Not technology! Technology can enable or hinder the customer experience. It is merely a tool.

Which means that there cannot be excellence in Customer Experience without excellence in Employee Experience. And these two have to be in tune with one another.

What does Nunwood say on the matter?  Here is what Nunwood says (bolding is my work):

With only a single exception, the top 10 ‘Champion’ brands are characterised by their evangelical employees and superior cultures. Employees who are exceptionally proud of the brand they represent and the job they do each and every day for customers. Their culture plays a pivotal role in creating outstanding customer experience and they value that some culture first and foremost. In a very real sense, employees come first and customers come second. 

Which is the single exception? I take it to be Amazon. And in the longer term this could be the undoing of Amazon.

Enough for today, I will continue this conversation in the next post. In that conversation I propose to explore the underlying factors that show a correlation with Customer Experience excellence.  Until then I wish you the very best.

Why I Prefer Not To Do Business With Customer-Centric Businesses

Why is it that I prefer not to business with a customer-centric business? Allow me to share my answer by referring to the UK grocery market.  Which supermarket chain was applauded, by many, for its customer-centred way of doing business? Tesco.  What was held responsible for fuelling this customer-centred way of doing business? The Tesco Club Card. Through this loyalty card, Tesco captured and made effective use of customer shopping data to grow revenues and optimise profits.  In the process Tesco came from nowhere to became the world’s second largest retailer.

Where is Tesco today? Here is what The Economist said back in July 2014:

… on July 21st Tesco abruptly announced that Mr Clarke would be leaving his job, apparently prompted by a warning that profits in the first half of 2014 would come in “below expectations”. In June Tesco revealed a drop in same-store sales that Mr Clarke admitted was the retailer’s worst performance in 40 years….

Recession taught middle-class shoppers that discounters like Aldi and Lidl were cheap but not nasty; they spent some of the money they saved at higher-end grocers, such as Waitrose and Marks & Spencer……

Tesco is faring badly. Its sales dropped by nearly 2% in the year to June while those of its closest rivals, Asda (which is owned by Walmart) and Sainsbury’s, rose by 3% or better. Despite his exertions, Mr Clarke failed to persuade consumers that Tesco offers better value than the discounters or quality to match the upmarket merchants.

Is this as bad as it gets? No. Here is what the Guardian newspaper stated in on the 22nd of September this year:

Tesco has suspended the head of its UK business and called in independent accountants and lawyers to investigate after discovering that its guidance to the City overstated expected first-half profits by about £250m….

Tesco shares fell almost 8% on Monday morning to an 11-year low of 212p, making them the biggest faller in the FTSE 100 index and wiping £1.5bn off the retailer’s market value. More than £6bn has been wiped off share value since 21 July, when the previous chief executive, Phil Clark, was ousted.

Why is it that Tesco is in such deep trouble? I say that Tesco has arrived at where it is at due to its customer-centric way of doing business.  What do I mean by this?  I mean that the Tops got fixated into harnessing the data yielded by the Club Card to get customers to part with more of their money in Tesco stores.

Was this done by offering customers superior products as in higher quality products? No.  The products were middle of the road yet ways were found of selling these at higher prices through clever marketing and merchandising.

Was this done by providing superior customer service in the stores? No. Tesco cut back on the number of people working in the stores so it was not unusual for the customer to find that there was nobody around to help when help was needed or find long queues at the checkout tills.

Was this done through a superior shopping experience? No. Management chose not to invest in the stores or the shopping experience in the stores. As a result the stores become less and less attractive over time.

I prefer not to do business with a customer-centric business because the management of such a business is more likely to be focussed on extracting value from their customer base through a variety of clever manoeuvres than earning its keep through superior products (Apple, Waitrose), superior service (John Lewis, Zappos), low prices (Lidl, Aldi), or a combination of service and low price (Amazon).

If you are a customer and your supplier is touting customer-obsession then  you might want to think about whether that is a good thing. Is the obsession with providing you with a superior product, superior value,  and/or experience? Or is it an obsession with with finding clever ways of getting you to buy more, pay more for what you buy, and get less in return? You might want to keep in mind that which many remind me of: business is not altruistic.

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