1. February 2020
(This post was first published on Linkedin on May 3rd 2019)
What did we learn and what’s next in CX Management?
I remember the first time I used Uber during a business trip to San Francisco. Downloading the app, entering my credit card details, redeeming a voucher and calling an Uber car all happened within minutes and worked like a charm. I did not contemplate about the disruptive potential but enjoyed a hassle-free ride without getting ripped off instead. What I didn’t know back then was that this experience that me and million other loved would today be a best case of customer experience (CX).
Customer Experience (CX) is a hot and trending topic. According to IDC the European Customer Experience Management market shall reach $48 billion market by 2022. Many companies have identified Customer Experience Management (CEM) as a key capability in their digital transformation. Job ads in various industries now list customer experience design as a required skill for many positions.
So it seems, that CEM has its bright future still ahead, but in reality, I can’t help the feeling that companies success today is hardly owed to excellent successful Customer Experience Management. Some recent articles analyzing the current state of CEM teams (here and here – German only) are supporting my perception. Although they make some interesting points, the message of all articles is quite similar: nobody loves us, our intention and goals are not understood, management doesn’t take us serious, we are limited in responsibility and impact. There seems to be a big discrepancy which might lead you to conclude that CEM teams are a waste of money and a thing of the past already – even before their bright future has started.
To understand this situation we need to look back a few years when it all begun. The basic idea behind CX seemed obvious: all companies need customers. If we treat them well and provide a feel-good experience they will love us, buy more stuff, recommend us to friends and consequently our business will prosper. On top, all the internet companies and startups have been doing it and won’t stop talking about it, so it can’t be wrong, right?
It makes sense to build and run a business around customer experience, but is it the only way to be successful? Just think of Ryanair. Would you say that their business is successful? Would you say they offer great Customer Experience? What about Singapore Airlines, who are really famous for excellent customer service and experience? Now compare their stock price development within the last 5 years and figure out if great CX is the holy grail of successful business.
The example of the stock performance demonstrates my point of view, where many CEM teams failed: they confused goal and approach. CX Employees often refer to themselves as mindset-changers, customer-advocates, workshop-facilitators, post-it-Ninjas, visualization-artists, journey-mappers and empathy-coaches. They created colorful workspaces, pinned post-its everywhere, introduced workshop rituals, mapped human emotions to journey and curves, and shaped mindsets. CEM Teams rather put their efforts into evangelizing customer centricity in their organizations rather than focus on the core purpose of Customer Experience: Doing better business.
The upside was that senior management were glad, that with their CEM team, they had another tick-off on the digital transformation check list. They could brag their CX quality on Powerpoint slides and in keynotes in digital festivals but still be able to chicken out when it came to business decisions where customer centricity was required to be the only way of doing business.
With the lack of CEM accountability to the companies success or failure, the core of the company kept calm and sticked to what they always did: business the traditional way including the the decline of revenues, churning customers, etc. They witnessed the rise of new and old competitors, and failing products. But they never correlated that with bad customer experience management. That is because nobody from the CEM team was able to explain and show the correlation in a language they understand: Money.
And CEM teams got frustrated because they all saw it coming, but expected the others to make the link that bad customer experience means losing money! As a result the first CEM teams got fired. For a reason.
So where are we and where are we heading to?
So where we do we stand today with CEM? A bright future and a staggering reality. The CX revolution has stalled. Or in terms of the Gartner Hype Cycle: we are past the ‘peak of inflated expectations’, and now in the ‘trough of disillusionment’. On top of that, many CEM teams are now watching from the sidelines how (among other influences) the agile movement, companies like Qualtrics (now SAP) and all major consultancies are entering their CX realm.
The good news are that according to the hype cycle theory the ‘slope of enlightenment’ and the ‘plateau of productivity’ are ahead of us. CX will grew out of its moody adolescence. I would say, that CX will be demonstrating its purpose to help organizations to achieve their objectives. But before we go there let’s recap what we learned from the roller-coaster ride in the last years. I have knocked up four learnings for myself:
- CX is ONE approach to run a business. A particular good one if you seek new growth or battle commoditization
- CX is not for every business. Some do just fine without it. My favourite example is Ryanair. A great customer experience is certainly not on their list of business priorities (except if you limit CX to low fares). But according to the numbers Ryanair is quite successful.
- CX is a way to achieve a desired customer behavior to make (more) money. It is the little sister of manipulation. CX is more of a business tactic than it is a corporate culture shift.
- Post-its, coaches and workshops alone don’t change a business. Purpose, people, priorities, and processes do.
I don’t think Uber had a dedicated CEM team when I first used their service. And I don’t think they have one today. But I am convinced they care about customer experience more than many other companies. For me that’s a blueprint of how CX drives better business.
Let’s take CEM a step forward. I am convinced that the best times are ahead of us. CX will go business. Better, stronger, more mature, and more professional. And CEM comes with new friends: Agile, digital, data, and AI. Will CEM teams be part of that future? And if yes, how will a future CEM team look like? I will share my thoughts on this in a next article.
Happy to take your feedback and questions in the comments section below.