The CEO’s Guide to Customer Experience

May 1, 20196min

“What do my customers want?”

The savviest executives are asking this question more frequently than ever, and rightly so. Leading companies understand that they are in the Customer Experience business, and they understand that how an organisation delivers for customers is as important as what it delivers.

Armed with advanced analytics, Customer Experience leaders gain rapid insights to build customer loyalty, make employees happier, achieve revenue gains of five-to-10 percent, and reduce costs by 15-to-25 percent within two or three years. But it takes patience and guts to train an organisation to see the world through the customer’s eyes and to redesign functions to create value in a customer-centric way.

There are three key management tasks to undertake in order to achieve this shift: Observe, Shape, and Perform.

Observe: Understand the interaction through the customer’s eyes

Technology has handed customers unprecedented power to dictate the rules in purchasing goods and services. Three-quarters of them, research finds, expect ‘now’ service within five minutes of making contact online. A similar number want a simple experience, use comparison apps when they shop, and put as much trust in online reviews as in personal recommendations. Increasingly, customers expect from all players the same kind of immediacy, personalisation, and convenience that they receive from leading practitioners such as Google and Amazon.

Central to connecting better with customers is putting in place several building blocks of a comprehensive improvement in customer experience.

  • Identify and understand the customer’s journey
  • Quantify what matters to your customers
  • Define a clear customer-experience aspiration and common purpose

Customer journeys are the framework that allows a company to organise itself and mobilise employees to deliver value to customers consistently, in line with its purpose. The journey construct can help align employees around customer needs, despite functional boundaries.

Shape: Redesign the business from the customer back

Customer Experience leaders start with a differentiating purpose and focus on improving the most important customer journey first – whether it be opening a bank account, returning a pair of shoes, installing cable television, or even updating address and account information.

Then they improve the steps that make up that journey. To manage expectations, they design supporting processes with customer psychology in mind. They transform their digital profile to remove pain points in interactions, and to set in motion the culture of continuous innovation needed to make more fundamental organisational transformations.

Customer Experience leaders can become even better by digitising the processes behind the most important customer journeys. In these quick efforts, multidisciplinary teams jointly design, test, and iterate high-impact processes and journeys in the field, continually refining and rereleasing them after input from customers. Such methods help high-performing incumbents to release and scale major, customer-vetted process improvements in less than 20 weeks.

Perform: Align the organisation to deliver against tangible outcomes

As Customer Experience becomes a bigger focus of corporate strategy, more and more executives will face the decision to commit their organisations to a broad CX transformation. The immediate challenge will be how to structure the organisation and roll-out, as well as figuring out where and how to get started. Applying sophisticated measurement to what your customers are saying, empowering frontline employees to deliver against your customer vision, and a customer-centric governance structure form the foundation.

Securing early economic wins will deliver value and momentum for continuous innovation.

Delighting customers by mastering the concept and execution of an exceptionally good Customer Experience is a challenge. However, it is an essential requirement for leading in an environment where customers wield growing power, and crucially without it, you lose your ability to meet their needs. And as we all know, in today’s market dissatisfied customers quickly move elsewhere.

The author would like to thank Kevin Neher and Ewan Duncan for their contributions to this article.


Harald Fanderl

Harald Fanderl

Harald Fanderl is Senior Partner at McKinsey Marketing & Sales.




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