I recently blogged on the deluge of disengagement among U.S. employees and stated that major achievements in productivity and customer experience will not be achieved until organizations tap into this 70% pool of disengaged employees and convert them to motivated employees.
A further breakdown of the data is now available which shows that levels of engagement are even worse in Western Europe. If the U.S. is experiencing a deluge of disengagement, Europe is already sandbagging and sending out the lifeboats. The highest engagement level is in Denmark with only 21% of employees engaged and France leads the way in levels of employee disillusion and apathy with only 9% of employees engaged.
As previously stated a host of social, economic and cultural reasons probably lie behind these figures. Undoubtedly however a large number of these employees are trapped in roles where they have little autonomy to influence how their work gets done. Locked into fixed inflexible processes in the restaurant, checkout or at a keyboard. From a customer service and experience point of view this 70-80% pool of disengaged employees is a well to be tapped. To begin eroding these levels of disengagement organizations need to become empowered organizations.
What does the employee empowered workplace look like? I’ll talk about that in the next post.
Like your aunt dancing to Daft Punk at a family wedding, when older established companies attempt to plug into the zeitgeist the results are often embarrassing. Across industry established organizations are experiencing a midlife crisis as younger more agile startups begin to erode their customer base. Instead of buying the sports car and dyeing their hair many established companies have lurched towards customer experience as a way to remain cool or relevant with predictably embarrassing results.
Interest in customer experience has been driven by lifestyle brands such as Apple, Disney and Nike, brands we enjoy using because they are associated with leisure experiences. The word “experience” gives the impression that we enjoy using the product or service, yet in our day to day lives we engage with many organizations on a purely transactional basis. Whether it’s a bank, an insurance provider or a utility, most of the time we are simply looking for process or transactional efficiency. Nothing more. Failure to understand this has led many organizations down the wrong path that views customer experience from a leisure rather than a process excellence perspective. I certainly don’t need my bank to start giving me discounted hotel bookings (they do), my ISP to give me tickets to the football (they did) or my dentist to give neck rubs (not yet).
The Great Customer Experience Swindle
In financial services and insurance it’s very easy to see the attraction of trying to focus on customer experience in market sector with few other product differentiators. UK banks have been quick to jump on the customer experience bandwagon but are mistakenly taking the leisure rather than process excellence route. Today UK banks currently offer lifestyle benefits such as movie downloads, cinema tickets, hotel booking discounts, airport lounge access, concert tickets and will writing services. The availability of these “benefits” poses a number of questions. First of all why are banks even offering these benefits in the first place? Cinema tickets, movie downloads and hotel discounts are benefits completely unrelated to their core business. Secondly why are banks providing these dubious benefits while they continue to suffer embarrassing outages, IT problems and customers struggle to talk to a human advisor? Also who joins a bank because of their will writing service?
Customer experience is often defined as how customers perceive their interactions with an organization. Each one of these interactions is a business process. Many customer experience leaders just execute their business processes better than their competitors. Take for example customer experience leaders; Amazon, Apple and First Direct. All three organizations execute their key business processes with precision and better than their competitors. Amazon excels in logistics processes, Apple in supply chain and research and development. First Direct show that by focusing on core customer processes and not gimmicks banks can transform customer experience.
This week more service outages hit the UK banking industry. Offering lifestyle benefits while struggling to keep the lights on shows a complete or deliberate misunderstanding of customer experience. A classic case of fur coat and no knickers as my mum used to say. Forget the VIP lounges and the tennis tickets if banks want to transform customer experience they need to focus on process excellence. Instead many UK banks are participating in a great customer experience swindle.
For a while we’ve gotten used to the B2B and B2C acronyms so today I’m going to suggest a new one, B2D or Business to Device.
It has been said elsewhere that the best customer service is one that doesn’t need to happen. As the Internet of Things (IoT) market begins to really heat up increasingly organizations will provide ambient customer service, directly to devices themselves without any human involvement. Over the past few years we have gotten used to this with new software releases and patches being delivered directly to our laptops, pcs, mobile devices and applications. Business relationships will increasingly be B2D or directly with their own products rather than with customers and other businesses.
Business to device is however subtlety different to IoT. IoT refers to ability of everyday objects to connect to the internet and their ability to store and process information. B2D takes IoT a step forward connecting the smart devices to business processes, for example triggering a support case when a product fault is detected.
In a previous post I stated that all of the data generated by OT devices is only of use if it is connected to business processes. There’s no point analyzing the data to predict a future product performance issue if a support process isn’t triggered or collecting customer usage data if the data doesn’t find its way into the hands of a sales person or the product development team.
IOT really has the potential to disrupt the supply chain, marketing and customer service processes of almost all industries. The potential efficiencies however will only be fully achieved when the smart devices are integrated with smart processes (or smart process applications). That’s what I’m calling B2D.
IoT + Process = B2D
I had the great misfortune of visiting the UNIQLO clothing store in Paris a couple of weekends ago. Dragged into the store by my other half on a Saturday afternoon what greeted me was pretty much man hell. The store was stuffed to the gills with shoppers. The aisles were too narrow. Lines for the changing rooms wound around the store and queues for the tills were about 20 deep. People were having sex just to make more room. (Ok I made this bit up.) Even my wife, who could shop for Ireland, gave up after a few minutes and suggested we leave. Rather than simply walk out it felt like we were guided to the exit by human peristaltic movement and defecated from the store. On any customer experience metric this failed big time. Yet the store was packed?
This experience also reminded me of a recent article about Richard X. Bove, a noted bank analyst, who pulled his money out of Wells Fargo Bank because of poor customer experience and went on to trash the bank via social media. The very same Richard X. Bove however in his capacity as a banking analyst said, “I am struck by the fact that the service is so bad, and yet the company is so good”. The bank retained a strong financial status in sharp contrast to the poor customer experience it was providing. Bove continued to recommend the bank as a safe investment to his clients despite the fact that Bove himself would not keep his own money in that bank as a customer.
So here we have two examples of businesses where customer experience stinks yet both businesses are thriving. We could easily come up with others. We are told by customer experience evangelists that businesses must make every customer interaction count. That customer experience lip service just doesn’t cut it anymore. The examples above appear to reject this theory.
There are a number of ways we could try and interpret this. Is customer experience just another victim of the recession as more and more consumers are becoming more and more price conscious? Does price alone explain why Uniqlo is packed to the rafters?
Is customer experience simply irrelevant in some markets for example financial services? The Richard X Bove example above can be easily explained by the focus of many banks on their investment rather than retail arms. Why would Wells Fargo invest in an improved retail banking customer experience when it will have little impact on their bottom line?
Finally and more controversially does customer experience even exist? Are we not talking about process excellence here? UNIQLO for example focus on process execution as their key differentiator;
UNIQLO has established a SPA (Specialty store retailer of Private label Apparel) business model encompassing all stages of the business–from design and production to final sale. By continuously refining this SPA model, UNIQLO successfully differentiates itself from the competition by developing unique products.
Apple and Amazon are often cited as customer experience leaders but both also excel in process execution and supply chain excellence.
Many organizations are doing perfectly well without focusing on customer experience. So does customer experience even exist? Is customer experience really just process excellence?
Showrooming is a relatively new phenomenon where a customer uses a bricks and mortar store to test and evaluate a product before buying it cheaper online. You’ve probably done it yourself. It can’t be long before, like a shoplifter, we see people thrown out of a store for using their smartphone to compare prices. It may already have happened.
The high street is suffering the double whammy of both the recession and the rise of ecommerce. While ultimately I think legislation will be necessary to protect bricks and mortar stores from their web based competitors the high street can begin the fight back by improving its business processes.
Retailers worried about showrooming can fight back but to do this they need to be clear on how they differentiate themselves from their online competitors. Many people for example will pay a small premium to get a product immediately rather than having to wait a few days for delivery. What this means is bricks and mortar stores must focus on their supply chain business processes. In addition the high street stores can offer customer post sale support, product training and immediate warranty replacement or returns that are more difficult do online. Again this requires a focus on post-sale business process.
It would be naïve however to ignore pricing. The recession has raised the importance of price to high levels and most people showroom to do a rapid price comparison between the price in store and the price they can get the same product online. Again this is an opportunity for business process improvement. Bricks and mortar stores can do price comparison as well.
Many high street stores are wedded to out of date, expensive to produce, catalogues of products whose prices are probably uncompetitive as soon as they are printed. There is no reason why bricks and mortar stores cannot automatically monitor competitor pricing and update point of sale prices in real time or produce a mobile app, with pricing that changes in real time, instead of a product catalogue.
Retailers are correctly looking to customer experience as a life raft for the high street yet incorrectly see customer experience in terms of gimmicks such as offering customers free wifi or a coffee shop without addressing their core business processes and the reasons why customers shop online.
When a customer enters a store the business has already done the hard part by getting the customer interested enough to get off the sofa and to visit their store. Improved business processes give them a better chance of converting that visitor into a customer and getting them to put away their smartphones.
Like a You’ve Been Framed clip of a dancing granny whose had too much sherry and falls into the Christmas tree or watching your uncle trying a bit of hip hop at a family wedding this week’s attempt by UK supermarket chain Waitrose to “get social” was both hilarious and deeply worrying at the same time.
Waitrose this week challenged shoppers to “finish the sentence: ‘I shop at Waitrose because …’ #WaitroseReasons“. It backfired spectacularly as Twitter users piled in to ridicule the brand for its posh image.
The failure to understand social media is not restricted to Waitrose though. Marketing departments globally have been guilty of failing to understand social media. Using for example Linkedin groups to promote your brand is like breaking wind in a tent and many organizations are abandoning their Facebook marketing strategies due to mixed results.
Social networks take conversations to a hyper level. The key word is conversations. Conversations are not about broadcasting marketing messages via social media channels nor are they about scanning or listening to social media networks for your company name. Conversations involve participants both talking and listening, not broadcasting and monitoring. Using social networks as a marketing channel is doomed to failure. As we have seen with Waitrose failure to understand social media can harm your brand and make you look completely out of touch.