Customer-Obsessed Companies Embrace Metrics Differently

When Forrester asked organizations about which metrics they use to drive customer obsession, we learned that it’s not about the metrics—it’s about how you use them.

Customer-Obsessed Companies Embrace Metrics Differently

by CMO.com Team

Posted on 10-24-2017

The buzz about artificial intelligence is palpable—and when I think about its possible applications in customer experience (CX) measurement, the excitement is justified, even if it’s early days. Artificial intelligence will completely change how we measure CX. Consider the ability to measure emotions in facial expressions. If we can measure how customers actually feel about their experiences, we can finally measure what matters most to customer loyalty.

But before firms can take advantage of that coming wave, they need to address the fundamental problem in CX measurement programs: They obstruct customer-centricity.

I speak to hundreds of companies about their CX measurement initiatives and have found over and over that they run into the same trap: They try to get employees to pay attention to CX by focusing on the metric, but many aren’t set up with the right culture. Organizations with this issue are bound to fail, as CX metrics and incentives start to get in the way of delivering better experiences.

Research from experts including motivational researcher Carol Dweck and behavioral economist Dan Ariely explains what’s going on. CX metrics have the same problems as reward charts for kids: They work in the short term, but leave kids (or your employees) less able to make the right decisions in the long run. That’s because CX metrics without the right culture lead to:

Navel-gazing: Companies measure by department, which creates poor experiences across end-to-end customer journeys that cross silos.

Myopia: Metrics often favor short-term wins—which are easily quantifiable—at the expense of longer-term customer goals.

Score obsession: Employees end up spending a lot of energy on improving a score, and it’s never a great customer experience when somebody begs you for a 10. More importantly, score-obsessed employees are highly likely to become cynical and lose the sense of pride in their work, which is a sure way to destroy any chance of becoming a customer-centric organization.

Customer-obsessed companies embrace metrics differently. When Forrester asked these organizations about which metrics they use to drive customer obsession, we learned that it’s not about the metrics—it’s about how you use them.

So, instead of thinking about metrics as a crude force way to achieve a better customer experience, CX leaders should embrace the customer life cycle, power long-term trade-offs, and create a culture of accountability. Let’s take each in turn:

Embrace the customer life cycle: Metrics must embrace the customer life cycle instead of being siloed and internally focused.

For example, Pitney Bowes moved past siloed metrics to embrace the customer perspective. Its global client operations group analyzed its problem-resolution process and found that three departments were involved in solving certain problems for customers. But each department had its own separate efficiency goal, and the inefficiencies that these conflicting goals caused led to longer time-to-resolution for customers. To provide incentives for collaboration, Pitney Bowes assigned a common goal to departments for better end-to-end CX: Reduce resolution time for customers.

Power long-term trade-offs: Firms need to build systems that power customer-obsessed trade-offs so that they don’t optimize for short-term goals over long-term benefits, such as increased loyalty and incremental revenue. To do this systematically, executives must add customer-centric metrics to their balanced scorecards. This tool balances short- and long-term financial and customer outcomes with internal processes and employee capabilities. Make sure that metrics in each dimension of the balanced scorecard are focused on the goal of customer obsession.

Create a culture of accountability: To elevate customer obsession, businesses cannot stop at the first two traits. They need to make employees accountable for delivering on CX while enabling them with training and tools to assume that accountability.

Ingredion, a global $6 billion ingredient manufacturer, did this very well. The firm defined a shared goal: to create value for customers. The CX team then worked with functional stakeholders to cascade the overall goal into cross-functional goals and functional scorecards. To cement accountability, Ingredion bases 10% to 30% of employees’ personal goals on these metrics, with lighter weighting for back-office employees and higher weighting for customer-facing roles. To enable employees to hit their goals, Ingredion trained 95% of its North America employees extensively.

Help your company to be a leader that instills a sense of purpose and gives employees the autonomy and self-efficacy we as human beings need to feel motivated. This will enable your employees to make the right customer-obsessed decisions—even when nobody is looking.

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