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6 Disciplines of a Powerful CX Strategy

Dave GardnerEVP Operations, Amy’s Kitchen

June 10, 2019

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Agenda• What is Customer Experience?• Why CX?• The 6 Disciplines• Keys to success• ROI• Digital Transformation• The Employee Experience

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Dave Gardner • Amy’s Kitchen, Petaluma, California

• EVP Operations (2019)• Manufacturing, sourcing, planning, transportation, and distribution

• Ingredion Incorporated, Westchester, Illinois• Vice President North America Supply Chain & Customer Experience

(2013 to 2018)• Vice President North America Manufacturing (2010 to 2013)

• Email: dave.gardner@amys.com

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Amy’s Kitchen

• One of the pioneers of the organic food industry

• Produce over 250 different organic vegetarian meals, including frozen entrees, pizzas, soups, candy, and more

• Available in all major US retailers• Sold in over 30 countries around the

world

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So what is Customer Experience?

• Companies exist because of customers• All employees own the customer experience….• But are they working for the customer?

• Larger organizations are siloed • Set internally biased objectives

Customer Experience is putting the customer first

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Objectives of a Customer Experience strategy

1) Redesign business processes so they are fully meeting customers needs

2) Create a culture where employees put themselves in their customers shoes

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Why CX for B2B companies?

• Companies don’t buy from companies, people buy from people

• You will repeat purchases and pay a premium buying from companies that are easy to do business with and fully meet your needs

• A positive CX leads to:Ø Greater retentionØ Improved margins

Ø Additional sales

* Source: Graphic courtesy of Genesis, and published in “The Customer Experience: What Makes the Best the Best – Part 1” Colin Taylor, The Taylor Each Group

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The 6 Disciplines

• Strategy• Voice of Customer• Metrics• Processes• Rewards• Governance

* Source: Outside In: The Power of Putting Customers at the Center of Your Business” by Harley Manning and Kerry Bodine (New Harvest, 2012).

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It starts with a well communicated strategy

• All change is led by the Why?• People get it – they are all buyers!• Broad communication

• Why is it important• How does the business need to change• What can they do

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Share the voice of the customer

• Employees must be aware of customer pain points• Creates empathy• Allows personalization• Develops understanding of needs

• Survey types• Relationship, transactional• Quantitative (surveys) and qualitative (interviews)

• Purpose• Measure of customer satisfaction• Source of insights that can drive improvements

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You can't manage what you don't measure

• Every employee contributes to the Customer Experience• 2 or 3 primary behaviors in each function as an indicator of

customer satisfaction• Track & publish• Keep it visual

* The phrase (and variants) is often attributed to Peter Drucker although it is unclear whether he actually is the original author

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Net Promoter Score

• Management tool that can be used to gauge the loyalty of a firm‘s customer relationships

• Has been widely adopted by >70% of Fortune 1000 companies• Correlated with revenue growth

“How willing are you to recommend our product/service to a friend or coworker?”

Source: Reichheld, Frederick F. (December 2003). "One Number You Need to Grow". Harvard Business Review.

http://hbr.org/2003/12/the-one-number-you-need-to-grow/ar/1https://en.wikipedia.org/wiki/Harvard_Business_Review

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Metrics

Type Where Examples

Leading indicators Process inputsControl points

Tender acceptanceInspection approvalOn time shipment

Documentation completeLagging indicators Process outputs Delivered on time in full

Customer complaintNet Promoter Score

Outcomes Process consequences Repeat ordersImproved margins

New business

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Redesign your processes

• Map the customer journey

• Identify pain points• Plan actions to address

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Redesign your processes

• Understand the customers true needs• Create cross functional teams• Use CI/Lean tools• Include customer in design & testing

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Reward great performance!

• Carrot vs stick• Financial rewards• Recognition• Annual celebrations

• Performance management• Annual CX goals• Compensation tied to CX

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Making it stick

• Embedding & reinforcing the behaviors• Governance team

• Broad representation• Ambassadors

• Aligning internal functions• Continuous training• Internal marketing

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Keys to success

1. Company values aligned with the customerØ Caring and Respect

2. Leadership from the top3. CX Champion4. Broad ownership5. Operational excellence6. Continuous improvement

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CX ROI

• Several studies published correlating CX with financial performance• Top line• Margin• Growth

• Bottom line• Productivity• Cost reduction

Source: Maritz CX “2018 CX Evolution Study of CX Stakeholders”

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CX ROI

• Several studies published correlating CX with financial performance• Top line• Margin• Growth

• Bottom line• Productivity• Cost reduction

Source: Forrester Report “Customer Experience Drives Revenue Growth, 2016” June 21, 2016; forrester.com/cxindex

7x growth in revenue over 5 years

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Why digital?

CustomersChannels

CompetitorsEmployees

ProductsOperationsInsights

Digital transformation of the customer experience

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All elements of business are being impacted by digital

Source: Forrester/Odgers Berndtson Q3 2015 Global Digital Business Online Survey, 2015 (base: 401 executives in companies with 250 or more employees)

Level of impact digital will have on the following functions over next 24 months

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Benefits of a digitizing CX

• Embed & systematize processes• Enhance visibility• Improve responsiveness• Free up resources• Increased ROI

• CX benefit• Operational efficiencies

Source: www.emergeTMS.com

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Digital transformation drives efficiency

• Companies selling online report more sales at lower costs• Simplifies processes• Become easier to do business with• Lowers cost to deliver

Source: B2B ECNEWS “Sana Commerce Digital Transformation and B2B E-Commerce Report 2017-18”

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Digitize your business. But how?

• MIT study on digital disruption modeled 4 approaches• Focus on OE first did not initially see an uplift in CX• Focus on CX first resulted in higher costs and disruption• 41% of companies who

improved OE and CX simultaneously experienced largest ROI

Source: P. Weill and S.L. Woerner, "Future Ready? Pick Your Pathway For Digital Business Transformation", MIT Sloan CISR Research Briefing, Volume XVII, #9, September 201

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The employee experience

• Goal is to put the employee first • How do you make your company easy to work in and fully

meeting your employees needs• A positive EX leads to:

Ø Greater retention

Ø Improved productivityØ Enhanced focus on the customer

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How to improve the employee experience

• If you don’t take care of your employees how can you take care of your customers?

Source: “Introducing Forresters Employee Experience Index”, David Johnson and Sam Stern, 2019

• Satisfy the key elements of employee engagement• Empower – having the latitude to act

• Inspire – having a voice in contributing to the mission

• Enable – having the resources & technology

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How to improve the employee experience

• Contributors• Mission & values• Clarity in expectations• Performance management• Hiring to match cultural fit• Employee development• Use of technology• Physical space• Wellness programs

Source: “IC Matters – How to Boost the Employee Experience with a Digital Workplace Strategy” Robert Grover, November 24, 2017

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EX mirrors CX

Customer Experience Employee ExperienceBehaviors

Easy to do business with Easy to work for

Meets customers needs Meets employee needs

Enjoyable Engagement

Outcomes

Less churn Less staff turn-over

Improved margins Improved productivity

Sales growth Employee development

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EX mirrors CX

Customer Experience Employee ExperienceBehaviors

Easy to do business with Easy to work for

Meets customers needs Meets employee needs

Enjoyable Engagement

Outcomes

Less churn Less staff turn-over

Improved margins Improved productivity

Sales growth Employee development

A positive employee experience delivers an improved customer experience

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How to shape the employee experience

StrategyVoice of EmployeeMetricsProcessesRecognitionGovernance

Share what and whyUnderstand the issues and needsEstablish KPI Address inefficiency and frustrationReward their contributionEnsure broad ownership

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Key messages

• Every employee owns and shapes the Customer Experience

• Improving the Customer Experience requires:• Redesigning how you work with your customer• Reinforcing a customer centric culture

• Enhancing the Customer Experience leads toØ Greater customer retentionØ Improved marginsØ Growth and additional revenue

Source: www.emergeTMS.com

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CX organizations