On September 27th, I had the great pleasure of moderating a panel at CEM Asia attempting to answer the question: How do business leaders quantify the ROI of CX?
The discussion was so valuable to those in attendance, I wanted to take the time to crystallize some of our thoughts to share them further so more of the CloudCherry audience could benefit from their insights. Here’s what we learned.
Vipul Chawla – Managing Director Asia Pacific – Pizza Hut
Raju Nair – MD & Regional Head Customer Journey Experience – DBS Bank
Aylwin Tan – Chief Customer Solutions Officer – Ascendas-Singbridge
Alp Altun – Executive GM Transformation & Customer Operations – Asia IAG
A world-class CX program can take many shapes
While all of these companies offer their customers a best-in-class customer experience, they all approach it a little differently.
For example, Raju Nair at DBS Bank, says that they’ve transformed CX from a solely customer service practice to a firm-wide strategy, pervasive in every decision. It comes from the top down. In fact, said Nair, “the CEO’s insistence at keeping CX at the top of the agenda has been really important.” Only coming from the top could the CX team embed this kind of strategy into every department.
On the other side, Alp Altun from IAG says that the front lines were the key to their development of an iconic CX program. Altun explained how they came to define a purpose that ignited everyone in IAG. “You’re commanding the data of many millions of customers. What do I want to do with this valuable data? Am I serving the community or the business? (…) It starts from defining your purpose in the community. That brings a sense of service to everyone in the business and removes that “it’s not my job” culture to empower the frontline.” He’s emphatic that without every employee on board, without a purpose they can rally around, you can’t bring world class service to customers.
Finally, Aylwin Tan at Ascendas-Singbridge, says that they built their CX program by focussing around three simple strategies:
How do we build products so that people enjoy being in their environment every day?
How do we meet our SLA day in and day out?
Can we make our legal documents easy to read?
By focussing on the biggest drivers of their clients’ experience, they were able to rally the business around CX improvements.
This tells me that there are many paths to the same goal. What’s clear from everyone’s story though is how important it is to diffuse the CX ideals throughout the business – it’s not just one department that can deliver on these goals. Everyone must be on board.
The North Star Metrics for CX Buy-in
Everyone on the panel was committed to the idea of keeping metrics simple and at the forefront of everyone’s minds.
Raju originally started by defining adoption metrics to track the rollout of the CX program by measuring behavior – not just outcomes. Even the CEO was held accountable to adoption metrics when reporting to the board. Because these metrics were pervasive across the entire company, the culture of the organization changed.
At Pizza Hut, they’ve long known that speed and taste were big drivers of customer loyalty (“I’ve yet to meet a hot pizza I didn’t like” states Vipul). But now, as life is becoming more complex, consumers are even more driven by convenience and ease. Now, Pizza Hut tracks three big drivers of the customer experience. “We want to make the acquisition experience easy, the conversion fast (they want it when they want it), and retention is all about taste,” said Vipul.
Aylwin uses three types of surveys to measure the effectiveness of their program. Annually they deploy vision maker surveys to stakeholders and visionaries, and user surveys to the customers of their clients. This is important because they want to move to a B2B2C relationship. Aylwin understands that even the experience of every person that touches the properties (not just their clients) matters. These annual surveys set the strategic direction for the year. They then use transactional surveys to measure how closely they are achieving their strategic priorities.
Both Aylwin and Alp cautioned the audience about the dangers of metrics. As Alp says, “Don’t trust a statistic you haven’t faked yourself.” Don’t use indicators simply as a number to be met – instead, look at the behavior it’s driving. When Ascendas-Singbridge started tracking the number of complaints from the call center it backfired. Contact agents were avoiding recording the complaints because they didn’t want to impact the KRA. Instead, set positive rewards for positive behaviors.
How do I get my dollars for my CX program?
Now to the question everyone wants answers for: how do I secure a budget to make sure I can hit my CX goals?
Vipul keeps it as simple as possible: “We track a very tangible correlation between taste and speed and customer retention.” This enables them to see exactly how big of an impact each improvement makes on their business – thus justifying additional spend in these areas.
For Raju, measuring customer experience over the customer journey has provided the necessary insight for calculating ROI. “Our customers live their lives and they have jobs to be done, and we’re trying to become embedded in their lives through our journeys. Adoption must go up, cost of acquisition must go down, and the cost of the transaction must go down. All of these are cost drivers which affect your cost equation. All of these costs fall off from how you have designed your journey and your delivery processes. Looking across all these journeys, you need to understand what the cost of keeping your customers engaged. This is how you determine whether your customer experience is impacting the results across the entire journey.”
At IAG, Alp shared how they started a new initiative called “Listen, Learn, Act” after their NPS results showed a number of irritants that were frustrating their customers. Part of this initiative is a wall in their call center where employees can pin irritants or potential solutions based on their conversations with customers. All of this information is used by the design team who are constantly looking for ways to make the experience effortless.
To quantify how these improvements or “value vectors” impact the business, they make a very simple calculation by looking at an increase in retention rate. For example, say they have a 65% retention rate. Why is it that low? Why is it not higher? For a billion dollar business, a 4% increase in retention would result in $4 million. That’s what we’re leaving on the table if we don’t commit to getting these initiatives out. Alp says to “decide whether the value vector is improving the customer experience or not and trace that improvement back to your financial metrics.”
Aligning the CX philosophy
My biggest personal takeaway from this event was how important a culture shift is when driving organizational change. It’s not always about the metrics or a checklist or scripts – it’s about igniting the passion for a common purpose. Aligning other functions around the CX philosophy is what will drive the behaviors that contribute to a world-class CX program.