3 Reasons Customer Centricity Brands Aren’t Walking The Talk

The executive meeting of a client became quickly heated. Their frustration was rooted in the discovery that the company was not as customer centric as it had led itself to believe. With C-Suite support, new marketing campaigns, messaging and content, new technology and processes the company could not reach the next level of target results. NPS, cross-product sales, and CSAT scores had increased but customers still complained about repeated service mistakes, billing errors, slow response times, sales not understanding their business, and not enough perceived value-add for the price.  The root cause was hard for the executives to hear – they were so focused on tactical, spot ‘fixes’ that they missed the essence of what cross-organizational customer alignment meant.  In short they weren’t walking the talk of customer centricity. How does that happen? This is actually a very common situation except that most companies don’t realize it. Jason Wadler, Chief Strategy Officer of Leapfrog Online and Chair of the Leapfrog Marketing Institute, says there are three common root causes:

  1. Culture
  2. Data
  3. Operations
Shifting from a product focused company to a customer-aligned organization changes how a company must operate.  “It requires a bit of a leap of faith and having the right controls in place,” according to Wadler. “Companies are competing against their customers’ expectations, less against their competitors.” Customer-alignment transformation must be led by the C-Suite, not delegated down, and takes around 24-36 months to complete. The CEO owns defining the alignment approach, target business outcomes, timetables and KPIs. The data companies collect and manage today don’t support customer-centric operations. The right data is either not available and or categorized correctly. On top of that, the data needs to be tied together at the customer level, not at the product or function level. Lots of companies do data analysis and come up with insights. But they are not actionable – they can’t leverage the data to drive the right individual customer interaction at the right time. While data completeness, accuracy and consistency is a centuries old problem, the difference today is that customers control the interaction at speeds unimagined before. The third root cause is operational. Is the company structured around the customer? Have the various functions been redefined in the context of the customer lifecycle relationship and how are they working together?  It’s not business as usual.  Wadler stresses that establishing clarity on who owns which decisions and who is accountability for implementing those decisions is critical. Aside from the root causes, most implement customer-aligned transformation plans miss:  Alignment of the annual budget and planning process. According to Deb Hall-Lefevre, SVP/CIO of Couche-Tard, “The process only works when priorities and goals are aligned across the functions.” She goes on to say, “Beyond that, funding decisions and execution becomes much more effective when there is a culture of collaboration, healthy debate, customer-first orientation, joint expectation setting, and fast decision making across the functions.” According to Leapfrog Marketing Institute’s 2017 Planning Report, part of the issue is that “55% of the respondents built their budgets with a primary focus on prospects or customers – a drop from 60% reported last year.”  If study participants weren’t focusing their budget planning on customers, where was their attention? On products and services offered. Of those companies that did build their budget to be more customer and prospect focused only “9% focused on cross-functional alignment.” That’s pretty low and is a direct contributor to missing out on the rewards of customer alignment.  Without collaboration and aligning strategies and budgets cross-functionally, customer alignment cannot be achieved. In fact, only 38 percent of study respondents report they currently have a dedicated customer experience budget.  The low percentage could be attributed to the difficulty in controlling, measuring and getting cross-functional resources aligned on key strategies and metrics. Company functions need to team up and co-create strategies, execution plans and supporting budgets focused on the larger goal of company-wide customer alignment. The other key requirement is measurable ROI accountability.  Since in most organizations Marketing owns customer experience (53%), marketers need to have over half of their budgets ROI accountable. The good news is that the Leapfrog study found that ROI accountability is gaining in acceptance along with increases in dedicated customer experience budgets. In fact, almost 10 percent of respondents “now have their first customer experience budget.” For companies trying to understand what ROI metrics look like, Wadler recommends asking these questions:
  • Did the activity move the business on the growth or efficiency axis?
  • Did it make the company more relevant to customers?
  • Is the organization more aligned on behavior and actions while reducing spend?
  • Are customer interactions managed according to an assigned value for each touchpoint?
  • Can the company move faster on market, customer or competitive opportunities?
Of the study respondents that were customer/prospect focused, 55% anchored their marketing budgets in customer life stages and 30% on customer value /LTV models.  The expectation is that over the coming years more companies will build budgets anchored in customer lifecycle stages in order to effectively respond to the continued pressure to deliver value, as defined by customers and prospects.  Wadler says “it is increasingly important for marketers to align investments with opportunities to drive scale and ROI.” Marketers are the change agents in operationalizing customer centricity.  If CMOs wish to remain with a seat at the table they will accept responsibility for forging cross-organizational collaboration and leading teams to develop the necessary strategic plans, tactics and budgets to achieve full organizational alignment to customer expectations. If your organization isn’t where it would like to be in the customer-alignment transformation, Leapfrog Marketing Institute offers these suggestions for walking the talk:
  • True customer experience ownership – dedicated customer experience plans and budgets are a necessity. Devices, channels and customer expectations are changing too fast for customer centricity to be treated as a decentralized initiative.
  • Customer-based planning and budgeting – with just 50 percent of budgets built to be customer centric, companies run the risk of investments being misaligned and high value customers lost. “Companies should consider a value-based segmentation strategy and test/optimize/scale methodology to validate the approach.”
  • Heightened focus on ROI/accountability – marketers must create performance investment tiers based on opportunity and value to both capture and report on clear financial-based business results if they want to keep their seat at the executive table.
  First published in Forbes.

The Chicken Littles of Artificial Intelligence

CNNMoney, citing a PwC report, declared that 38 percent of USA jobs will be lost due to robots and artificial intelligence over the coming 15 years.  Jobs that perform routine, repetitive tasks and are in industries include manufacturing, banking, education, retail and hospitality.  The same warning bells are being rung by The Economist, New York Times, The Guardian and others.   The World Economic Forum cites a “net loss of over 5 million jobs by 2020 in 15 major developed and emerging economies.” The mainstream media headlines around automation related job loss are akin to Chicken Little’s warning that the sky was falling. The sensationalism overstates reality. The impression is that job loss due to automation is a recent phenomenon. It’s not. The ATM was created in 1967 and has taken over 30 years to evolve into what we take for granted today. Did it significantly reduce bank teller jobs?  Yes, over a long period of time. But it did not eliminate the position; it evolved. There are countless examples of how technology has changed economies, professions and industries.  This has been going long before the steam engine and electricity was invented. The pace of technological change today is, however, increasingly faster.  PwC’s 15 years forecast for job loss is challenging to believe when we look at the reality of what it takes to implement artificial intelligence. Spoiler alert - our ability to forecast the timing of future events with a measurable degree of accuracy isn’t particularly good. Rurik Bradbury, Head of Research at LivePerson, a mobile and online messaging company, has a different perspective. “The prospect of replacing entire jobs with just technology is unlikely,” shares Bradbury. “There is a lot of confusion about AI with more talk than actual deployment.” Today’s artificial intelligence technologies are capable of performing tasks at the atomic level. These are very narrowly defined tasks that operate within a clearly defined set of responses. Based on LivePerson’s customer experience, Bradbury strongly believes that AI can perform, on average, 40 percent of the tasks comprising customer care jobs.  In other words, AI driving the level of unemployment forecasted by CNN within the next 15 to 20 years is unlikely. Even if we just focus on customer care jobs across all industries. Here’s why. Jobs are comprised of a multitude of tasks as well as a wide range of problem solving situations that require lateral thinking and complex, emotion-based human interactions. Bringing in AI to a customer support position, for example, requires the job to be broken down into its detailed components. On average approximately 40 to 50 percent of tasks in a call center are good candidates for automation. These are tasks that a call center agent or manager can trigger – updating your address, for example. The dialog between the AI and the customer is controlled by how the AI application is programmed and closely measured with human oversight.  AI does not run without tight controls in place.  The analytics include sentiment analysis that tells management which AI-conducted customer interactions were positive or negative.  Negative interactions can result in shifting that task back to a human or reprogramming the AI software. AI doesn’t replace workers; it augments their ability to be more effective and productive. That doesn’t mean that the nature of work will not change, it will. The operative word is augmented – Bradbury calls it “job sharing.” Routine, data-driven, narrowly defined subtasks will be automated freeing the human worker to engage in higher level, most sophisticated tasks such as creative problem solving, strategic thinking and relationship building.   The latter being things humans are much better suited for. Based on Bradbury’s research and LivePerson customers’ experience, the rate of AI taking over human tasks is slower than popular media would lead you to believe. First, to effectively employ AI to drive a positive, productive customer experience requires a clear plan based on gradual automation over time.  Secondly, the current rate of automating tasks is one percent a year. In the case of the 40 percent of call center agent tasks that could be candidates for automation, companies would be extremely hard pressed to achieve that level of automation within ten to fifteen years. So much for predictions. That doesn’t mean ignore artificial intelligence. Approach it with a solid plan based on best practices.  Here are a few of Bradbury’s suggestions:

  1. Collect a data set of good (read: successful) customer interactions and categorize them, identifying the most frequent interactions.
  2. Pick candidates for automation based on opportunities to improve the interaction. Start with a very small group of interactions to experiment with.
  3. Take a subset of these identified interactions and create a chatbot or AI interface that is specific to the atomic task being automated. The more granular the definition and automation of the task, the higher the success. 70 percent of current AI tasks fail because they are too general.
  4. Put the AI task into production aside a team of call center agents and test. That means collect data, perform A/B testing, and analyze the conversations and their outcomes. Evolve the AI software over time based on the results of the analysis.
  5. As success is realized, automate additional tasks based on the same testing and analysis approach. Set performance thresholds for each AI task. Keep in mind that AI applications work in tandem with employees and need to be orchestrated are part of a company’s ecosystem.
How we look at technology directly influences how we fit it into our lives.  Don’t think of artificial intelligence as a separate project or technology. Think of it as part of a job and measure it accordingly. Ignore the chicken littles. Leverage AI where it enhances the customer experience and delivers measurable value add. Start small, get granular, and go slow.

How To Effectively Implement Customer Journey Maps

Journey mapping is a core discipline and competency of leading organizations. No longer considered a marketing or customer success initiative, leaders are realizing that everyone benefits from understanding journey maps and how they can be acted upon.   And by ‘everyone’ I mean everyone – from Finance to R&D/Engineering to Facilities.  Directly or indirectly, every job contributes to measurably delivering a consistent, valued customer experience. While the concept of sharing journey maps and coaching employees on how to operationalize journeys in their jobs is widely agreed to, implementation typically meets with resistance. Common objections include:

  • The maps will get into the hands of competitors.
  • Employees aren’t interested and won’t understand.
  • Being challenged by peers on the process, results and recommendations.
  • It takes too long to explain how and why specific touchpoints should change.
  • Belief that any process changes just need to be implemented in IT systems and applications.
At the root of each of the above points is a fear of change.  For managers who have not been formally trained in change management, effectively positioning and connecting the dots for each employee on how this can benefit them is daunting. It’s easier to just keep the knowledge within a siloed team and focus on aligning the processes the team owns. The thought process is that as other teams see their success they will want to join in. The ROI of journey mapping is realized when all employees understand how to align their activities to customer expectations. Employees are quick to see how embracing small, incremental changes can lead to higher job satisfaction and performance for them as well as company.  They just want to have a vote and voice in the implementation process.  Ironically, this is what customers want when participating in journey mapping and co-creation workshops. From my experience there are three best practices to successfully operationalizing journey maps.
  1. Develop internal audience-specific versions of the journey map(s).
Different people consume information differently; one size doesn’t fit all.  By tailoring how the maps are presented for each audience type, it makes the information more accessible and consumable. Develop a hierarchy of journey map documents demonstrating varying levels of detail and add graphics appropriate for each audience group. Executives want a one page, high level graphical map that shows key moments of truth, decision tollgates, and high value generating touchpoints. Managers want more detail and employees need even greater detail. Both audiences will benefit from graphically depicted journeys that are contextually relevant to their roles. Have fun with the graphics and don’t forget to develop versions to share with distributors, partners and key suppliers.
  1. Socialize journey maps through multiple channels.
Journey maps, done correctly using ‘outside-in’ methods, are a gold-mine of information that touches every corner of a company in measurable ways.  There are over 30 uses for the data coming out of journey maps.  Figuring out the best way to socialize a customer journey map can be overwhelming – the trick is to do it informally in bite-size, interactive chunks. Last year, I attended a meeting where the client insisted that all employees attend a PowerPoint presentation of the post-purchase journey maps. The content was powerful but the presentation resulted in the sales team falling asleep (literally) and engineers heads down on their smartphones.  The result was no one was particularly gun-ho to step up and embrace new ways of engaging customers. In fact, few people actually remembered what the meeting was about.  The data was correct, the presentation was dead boring; people tuned out. My recommendation is to kick off the operationalization of journey maps with an all-company meeting led by the CEO, thirty minutes max.  Having the CEO introduce the initiative speaks volumes to its importance to the company. Even more powerful is to have a customer co-present; that will get everyone to sit up and pay attention. That introductory session should be followed by three actions:
  • Develop and share interactive versions of the journey where people can explore and learn about journeys at their own pace and through their own perspective. This enables people to drill into the details or not – consider using a 3D tool like Kaon and check out Genroe’s review of journey tools.
  • Host open lunches or breakfasts to help team members understand the journey, how they can impact customer delight and what alignment would look like. Use these sessions to address skepticism and gain buy-in.
  • Bring customers in (virtually or in-person) to talk through their experience and how they define value-add, preference and intent. Building a bond between internal employees and customers is crucial to not only successfully implementing change but to maintain alignment with customers’ evolving expectations.
  1. Define a phased roll-out plan.
Despite today’s common belief that everyone will jump at the chance to change, it makes everyone uneasy. Human nature fears uncertainty and we spend inordinate amounts of time imagining all sorts of dire consequences, most of which are unfounded. It’s our natural resistance to change that requires operationalizing a journey with a plan. Begin by developing a phased, cross-organization change plan by prioritizing key interaction points and moments of truth that are driving customer dissatisfaction.  Look for journey steps where company engagement is counter to what customers said they expected. Also look for points that trigger complaints, high customer stress or frustration, and/or negative word of mouth. Develop a high level plan and milestones that are signed off by executive leadership. Structure the plan in sprints with target metrics before socializing with functional leadership. Based on my experience, I strongly recommend a bi-weekly steering committee of functional leaders and the executive sponsor(s) to reviews progress, issues and new customer behavior and feedback.  Consistent visible and vocal executive sponsorship, preferably by the CEO, is a critical success factor. Keep the whole company engaged by sharing implementation progress and give teams time to share lessons learned – good and bad - as part of monthly/quarterly all-company meetings. Celebrate successes no matter how small.  Public recognition is one of the most powerful motivators. Recognize a team that has changed a process and the measurable improvement in customer engagement. That will motivate others to take the initiative and step up. Don’t be afraid to include a handful of strategic customers in this initiative.  Their involvement adds gravitas to the effort and keeps the effort on target.  This is a community effort; make it one with all the trappings.

What’s an Airbnb Host’s Worst Nightmare?

A bad review.
Here is a story that outlines some common mishaps that can occur when communication breaks down between a host and a guest, and a simple solution that can change the outcome for the better.

A Common Scenario

Gary, a recently retired professor, is excited about his upcoming travel and his first Airbnb! After booking his reservation, Gary isn’t sure the reservation is confirmed since Huey, the Host, never sent him a confirmation email or thanked him for the booking. Nonetheless, Gary isn’t too bothered and looks forward to his travels.

The Arrival
Travel day is here and Gary finally arrives to his Airbnb destination. He seems a bit confused seeing many parking spaces and tries to remember if Huey ever provided parking details. Gary sees a few empty spots in the parking lot and decides to park in one of them. As Gary begins to remove the luggage from his car, a neighbor approaches him. The neighbor explains that Gary has parked in his parking space. Slightly irritated, but trying not to let it spoil his trip, Gary puts the luggage back in his car and drives to a different parking spot.

The Keys
Standing in front of the home, Gary rings the doorbell. After waiting a few minutes, he looks around to see if Huey may have left the keys in a lockbox or maybe inside the planter. No lockbox, no keys. Gary decides to call Huey, but there is no answer. Gary is now beginning to get anxious and kicks the front doormat in frustration, when he happens upon the door key which had been hidden beneath it. Gary uses the key to enter the home.


The Internet

Gary is a tired from his travel thus far and hopes the remainder of his stay goes more smoothly. The home looks nice and Gary is excited to email his friends back home to tell them about his Airbnb adventure thus far. Gary turns on his computer but can’t seem to connect to the internet. There are multiple Wifi signals available, but all require a password to gain access. He looks around the room for instructions but can’t find anything. It occurs to him that maybe the passcode is on the bottom side of the internet router. No such luck! Gary gives up and goes to the kitchen for a glass of water. There on the refrigerator door, on a small sticky, he sees the words “Wifi Passcode”.


The Departure

During the morning of Gary’s departure, he sips his coffee while reading the newspaper, when the front door opens. A group of people enter with a mop, a broom, and a vacuum cleaner in hand. The cleaning crew has arrived and wants to clean the home and prepare it for the next guest. Annoyed and embarrassed, Gary makes his way to the bedroom to change out of his pajamas.

You can’t help but feel bad for Gary and can only imagine the type of review he will be leaving for Huey.

A Better Way
Now, let’s rewind and imagine an entirely different scenario. One where Gary receives a Confirmation message from Huey minutes after booking his reservation. Then, 24 hours before his scheduled arrival, Gary receives a Check-In message with very specific instructions about parking, where to find the house keys, the Wifi passcode and other pertinent details he will need to make his stay a more enjoyable one.

In this scenario, things go so well for Gary and he truly enjoys the start to his retirement, that he actually wishes he could stay longer. Coincidentally, Gary hears the Airbnb app chime from his phone. Gary pulls out his phone to see a message waiting for him from Huey. The message informs Gary of a vacancy after his scheduled departure, and Huey provided an offer should Gary choose to extend his stay. Gary is pleasantly surprised and decides to extend his trip for two additional days.

The day before his updated departure date, Gary receives a very nice email from Huey reminding him of the Check-Out time and informing him of the Check-Out instructions. Gary has truly enjoyed his first Airbnb experience and looks forward to writing an excellent 5-star review for Huey.

Automate and Simplify
In the latter scenario, Huey has added message automation software to his arsenal of tools. Message automation software allows Huey to create personalized messages that include all of the important details that his guests may need. The messages are delivered into the Airbnb message thread on a pre-set schedule for Gary and all of Huey’s future guests so he will never have guest communication issues again. Riding this wave of the short-term rental market, the host who is most prepared will be the one who delivers the happiest guests. And a happy guest translates into a 5-star review, which means a higher listing ranking and more bookings.

I was inspired to write this story after recently renting an Airbnb from a super host that used a new piece of software to communicate with me. That software was Aviva IQ, a Silicon Valley startup. Necessity remains the mother of invention, the founders developed the SaaS based application out of their frustration in delivering a streamlined communication process that didn’t require immense levels of manual work. Aviva IQ allows Hosts to automate their Airbnb messages so important details about the reservation can trickle out over time, at the optimal time. For the guest, it means having a consistent and enjoyable experience. Their focus is on their trip and less on the details and concerns about rental logistics.

Everyone gets a good night sleep.

First published in HuffingtonPost