The Art of the Possible: The Customer Service Journey

The Art of the Possible: The Customer Service

Journey

The Three Waves of Customer Experience

Research Perspective

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© Ventana Research 2014

Ventana Research: The Art of the Possible: The Customer Service Journey

Table of Contents

The Evolution of Customer Service 3 The Service Efficiency Wave 4

The Disconnected Service Wave 5 The Fully Engaged Customer Wave 6

Optimizing the Customer Experience 8

About Ventana Research 10

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Customer service has evolved as three waves of progress:

• Service efficiency • Disconnected

service • The fully engaged

customer.

The Evolution of Customer Service Profitable long-term relationships with customers depend on providing superior customer service, which is to a large extent shaped by how companies engage with customers throughout the customer journey. However, for many years the goal of both the dedicated customer

service department and other employees engaging with customers was to handle customer interactions as efficiently as possible – a focus that endures. Despite companies’ insistence that their primary commitment is customer satisfaction, our benchmark research into customer rela-tionship maturity shows that for many, efficiency remains the top priority, often to the detriment of customer satisfaction. But if organizations are slow to change, customers are not. Consumers have

rapidly expanded the number of channels through which they want to engage and when they engage with

companies. Their expectations have evolved as well: In their view they should be able to use any channel or combination of channels they like – telephone, email, chat, customer portal, social media or mobile app – and still have the same experience and receive the same information. Our benchmark research into customer experience management shows that this remains a challenge; not many companies have revised their processes and adopted new systems so that all business units and self-service channels can provide the same information and experiences across all interactions. In our view, the customer experience and thus customer service has progressed through three waves as detailed below; if companies want to deliver a true omni-channel experience they need to evolve through these waves as quickly as possible. Each wave is a combination of how companies support different channels of engagement, who within the organization handles interactions, how companies analyze data and what metrics they use to assess customer engagement and the customer reaction to each engagement.

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The three waves of customer experience can be summarized as follows:

Efficiency

Limited number of channels

Calls routed to next free extension; mail and email handled randomly

Metrics focus on efficiency

Business units operate independently

Companies have multiple partial views of customers

Disconnected

Multiple stand-alone channels

Customers channel-hop and become frustrated

Metrics focus on efficiency and customer satisfaction

Business units operate independently

Companies have a single view of customers but it is incomplete

Fully Engaged

Multiple integrated channels; interactions routed using a single customer-related set of rules

Customers use more self-service channels, many are mobile and voice-activated

Metrics focus on business outcomes and effectiveness

Business units use collaboration to achieve consistency

Companies have a complete view of customers, including journey maps

The Service Efficiency Wave In their pursuit of efficiency, organizations have over the past two decades invested in on-premises technologies such as private branch exchange (PBX) telephone systems, automatic call distribution (ACD), call routing and computer/telephony integration (CTI) to centralize the handling of calls. This first wave of investments had the effect of diverting time and resources that might otherwise have been used to focus on customers and the agents serving them. Companies did introduce self-service technologies such as telephone-based interactive voice response (IVR) and frequently asked questions (FAQ) lists on websites to reduce the volume of calls handled by live agents, but these efforts have had limited success – our benchmark research into the use of technology in contact centers, for example, shows that more than half of customers using web-based self-service or IVR end up speaking with a contact center agent. In these situations difficulties in getting the right information for their particular needs frustrate customers and degrade the customer experience. One notable trend has been investment in customer relationship management (CRM) systems. These do help companies manage

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internal marketing, sales and customer case management processes and transactions. But again, such systems were not designed to focus on customer interactions and experience. In the end, these service efficiency wave technology deployments

proved to be retrograde, undercut-ting the success of customer service without diminishing its importance: In our benchmark research into next-generation customer engage-ment, almost three-quarters of par-ticipants said that improving the customer experience is a key driver for improving customer engage-ment. In truth, many companies seem poorly prepared to truly put the cus-tomer first. Most need to invest in people, process, information and

technology improvements focused on customer engagement if they are to provide customer experiences that will maintain and grow their business.

The Disconnected Service Wave Companies today interact with customers through a dizzying array of different channels. Our research finds that more than one-third of companies currently use 12 communication channels to engage with customers. In addition, customers are more demanding in the quality of service they expect, and complaints about poor customer experiences have become more visible through social media. Despite this proliferation, our research into next-generation customer engagement shows that the three dominant communication channels remain the telephone, email and the website’s customer portal. Companies’ focus in these long-established channels remains on efficiency in handling customer interactions. In addition, responses on different channels are not consistent; customers often have to “channel hop” until they get the information they are looking for, and this drives down customer satisfaction and drives up operational costs. As consumer use of text, Web chat, social media and mobile apps increases, companies must dedicate resources to support these

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additional channels – but like the others, these channels are managed independently. Today most companies continue to operate marketing, sales, customer service and the contact center as separate business units. Our benchmark research into the agent desktop and customer service

shows that for one in five (21%) companies the biggest challenge in meeting customer service expecta-tions is that communication chan-nels are managed as silos, often by different business units; the second-most common challenge (for 17%) is that customer-related activities are not coordinated across business units. In these situations customers don’t get consistent information and overall satisfaction levels are likely to reflect that. Moreover, the systems used to sup-

port customer service typically are not designed with the customer in mind. For example, our research into next-generation customer engagement shows that in almost three out of four (72%) companies the primary use of social media is for marketing. Moreover, the main capability 40 percent of companies support on smart mobile devices is browser access to the corporate website. Neither function supports customer service directly, and so frustrated customers often end up calling the contact center. One critical result of this disparate array of channels, the hallmark of the disconnected service wave, is that most companies don’t have a complete view of the customer; what’s available doesn’t include all customer interactions or the business outcomes of interactions. To be effective, companies should be trying to understand the history of the customer’s contacts as a journey with the company that may well traverse channels of communication and business units and reflect the different stages within the customer life cycle.

The Fully Engaged Customer Wave Companies seeking to move beyond disconnected services to the third wave of full engagement first must acknowledge several salient facts of business today. One is that customer service is the true

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differentiator. Another is that it is easier than ever for customers to change suppliers. Moreover, one bad engagement can damage a company’s brand significantly as dissatisfied customers broadcast their opinions through social media. And the boundaries between marketing, sales and customer service are beginning to fade and in some cases almost disappear as companies strive to make the most of every interaction. The most innovative companies are beginning to embrace customer engagement as an enterprise issue and work to optimize customer interactions across all touch points and at all times throughout the customer journey. To do so, they emphasize collaboration. Our research shows that for 27 percent of companies the technology most commonly used to improve customer engagement is collaboration, which makes it possible for all business units engaging with customers to work together as needed and allows sharing of real-time information to support consistent decision-making and actions based on business rules. Using such collaboration, for example, a major tool manufacturer found that all its employees could access the information they need to understand customers and stay coordinated when

working with them. Our research also shows that the fastest-growing channels of custo-mer engagement are social media (30% expect significant growth), Web-based self-service (25%), the customer portal (24%) and mobile apps (also 24%). However, all channels are predicted to grow, so to provide consistent experiences across them all, companies must deploy, most likely in the cloud, integrated systems to manage all channels of communication. Using

such systems, interactions can be routed according to the same customer-related rules so that, for example, a valued customer will be given priority and routed to the person he or she is most familiar with and who is most likely to produce the best business outcome. Innovators also are responding to a change in customer preferences by shifting from reliance on a browser on a smart mobile device to

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In pursuit of seamless customer engagement, companies connect communication systems, business apps and analytics to produce a complete view of customer journeys.

mobile apps, which are designed to be customer-friendly and are developed to enable quick access to customer-related tasks. Using such a mobile app, one major drinks manufacturer found it was able to reduce the onboarding time for new customers by two-thirds. Many of these new mobile apps are voice-activated to make them easier to use, especially on the go. Companies also are extending their use of social media to include social forums where customers can collaborate with other users to resolve issues. In general, the trend is for companies to replace self-service with connected service, in which customers may begin to serve themselves

in a mobile app, a rules-driven Web portal or a voice-activated self-service system but can seamlessly transfer to assisted service (interacting with a person) without having to repeat already completed steps. Innova-tors support employees who handle inter-actions with systems that automatically provide information and guidance, thus reducing their need to access business apps; guidance, too, is rules-based, shaped by the customer’s profile and the context of the interaction. And these companies enable mobile systems for employees, so they can work away from

their desks or at any approved location.

In pursuit of seamless customer engagement, these companies connect communication systems, business apps and analytics to produce a complete view of customer journeys that encompasses business units, communication channels and business apps and that shows the outcomes of those journeys.

Optimizing the Customer Experience Customer expectations continue to evolve in the direction of easier, more personalized and consistent experiences across more channels of engagement (many of which will be mobile and voice-activated). The Internet of Things and wearable devices will impact customer engagement further as more devices are connected and companies have more information about their customers.

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Companies need to use this information to understand and so be able to optimize both customer journeys and business outcomes – and do so while sustaining positive and fruitful relationships with their customers. There is evidence that this can be done; a major restaurant chain, for example, reports that having such a view helps better meet its customers’ needs and personalize their experiences in restaurants. To meet these expectations, companies should assess where they sit in the three waves and put in place plans to evolve as quickly as possible. Technology can help: It continues to evolve as well, providing tools that enable companies to move beyond mere efficiency and disconnected service to provide fully engaged service. However, our benchmark research into next-generation customer engagement shows that most companies are slow to adopt these new technologies. In our view, investing in such tools is essential for organizations seeking to differentiate themselves through improved customer service, to gain and retain competitive advantage, and to engage customers fully. Building profitable customer relationships requires understanding, deft adaptation and investment to meet the expectations of customers. To succeed, companies must take an omni-channel approach and evolve quickly to the most advanced customer service wave. Those that haven’t done so should begin this journey right away.

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About Ventana Research Ventana Research is the most authoritative and respected benchmark business technology research and advisory services firm. We provide insight and expert guidance on mainstream and disruptive technologies through a unique set of research-based offerings including benchmark research and technology evaluation assessments, education workshops and our research and advisory services, Ventana On-Demand. Our unparalleled understanding of the role of technology in optimizing business processes and performance and our best practices guidance are rooted in our rigorous research-based benchmarking of people, processes, information and technology across business and IT functions in every industry. This benchmark research plus our market coverage and in-depth knowledge of hundreds of technology providers means we can deliver education and expertise to our clients to increase the value they derive from technology investments while reducing time, cost and risk. Ventana Research provides the most comprehensive analyst and research coverage in the industry; business and IT professionals worldwide are members of our community and benefit from Ventana Research’s insights, as do highly regarded media and association partners around the globe. Our views and analyses are distributed daily through blogs and social media channels including Twitter, Facebook, LinkedIn and Google+. To learn how Ventana Research advances the maturity of organizations’ use of information and technology through benchmark research, education and advisory services, visit www.ventanaresearch.com.

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