How to Avoid the 7 Deadly Sins of Customer Experience Transformation
Customer experience (CX) has emerged as something of a cure-all for businesses. When done well, it creates value, reduces costs, and improves both customer and employee satisfaction.
The journey to effective CX implementation can be tough. That’s because great customer experience isn’t about just fixing an issue, but about rethinking it and often creating something completely different. That requires a transformation of how the business approaches CX: its processes, technology, employee mindset, and behavior.
In our experience, companies that have trouble with their CX transformation programs commit the following “seven deadly sins.”
Many CX transformations fail because they are not a top-three priority for the CEO or the executive team. Without their support, securing cross-functional alignment—crucial for any CX program—is difficult, and often leads to internal resistance or indifference, which halts momentum.
The odds for success improve when engaged leaders make high-profile commitments to CX (such as making it a top agenda item, allocating significant resources, putting top performers into CX roles) and ensure integration across current internal silos.
Many managers enter a transformation with no real vision for the organization’s future state. Instead, they have a general desire to improve the CX and rush into action quickly. Leaders can often prioritize the wrong areas of focus, wasting time setting targets for parts of the customer journey that don’t have a real impact.
Great organizations instead spend significant time upfront to define a clear and compelling aspiration, which could be having a best-in-class CX or improving the baseline experience. These companies also think about how to translate their vision/aspiration into a common purpose for all employees. Great CX is always linked to strong collaboration across silos. A strong common purpose accelerates the necessary collaboration.
Too often, transformations are not treated as an operational problem and start with a rigorous attempt to identify those things that matter most to customers. Two factors must stand out: measuring customer journeys instead of isolated touchpoints, and using imputed importance to analyze survey responses. These methods allow companies to stay on target about what really matters to a customer during a CX transformation. They can then prioritize their efforts by combining imputed importance, the number of customers touched, the priority level of the customer segments involved, and alignment with broader strategic objectives. It is critical to couple these statistical techniques with ethnographic research to build a fuller picture of “what matters,” especially in settings where statistical techniques may come up short.
Many organizations launch CX transformation programs with no sense of what the new experience will be worth. Leaders of such a transformation will find it hard to secure sufficient resources for needed investments if they don’t have evidence that their efforts will generate business value. Or they will focus on CX improvements that don’t generate sufficient value.
Building a successful business requires using customer research and operational data to link customer satisfaction with financial outcomes, such as customer churn and new revenue. This analysis will provide the foundation to know what each point of satisfaction is worth to the business.=
CX transformations can collapse even when executives have correctly determined what matters to customers, defined a good target, articulated a clear link to value, and provided strong support. In these cases, the culprit is often a loss of momentum when the project doesn’t deliver impact in the short term.
Great CX transformations must include a balanced portfolio of initiatives (long and short term, revenues and costs) to show success early, sustain momentum, and learn over time. Leaders sometimes also focus exclusively on the top-line impact—revenue from increased loyalty and reduced churn—to the detriment of equally powerful cost levers (e.g., cost to serve).
Many managers tend to think about the CX very narrowly, often excelling at designing specific customer interactions but ignoring the fuller experience, both before and after purchase. They underestimate the importance of the internal cultural changes needed to achieve and sustain a new approach.
Successful cultural change relies on four factors. One of them is formal measurement and performance systems. But employee involvement, role modeling from leaders, and clear explanations of why change is necessary are important, too. Great transformations work across all four at once and spend as much time on the “soft stuff” of culture change and communication as on the “hard stuff” of performance management.
When companies fail to consider opportunities from design thinking—shorthand for a test-and-learn approach to problem solving based on deep understanding of the customer—they may not succeed in transforming identified customer pain points. Great organizations apply the tools of human-centered design to create distinctive customer experiences. And they follow where the evidence leads even if that means breaking with conformity—that is the path to innovation.
Transforming CX can deliver higher profits, more loyal customers, and more engaged employees, to name but a few benefits. Understanding and resisting the temptations described above will help you keep your vision and change program on track to deliver on those rewards.
Ewan Duncan is a senior partner in McKinsey & Company’s Marketing & Sales Practice. He works with technology, media, and telecommunications clients across multiple topics to improve overall performance and works across sectors to drive improved customer experience and engagement.