The world is emerging from the pandemic and confronts the challenges caused by inflation, global conflicts, rising concerns about issues such as climate change and corruption in public life, and fast-moving changes in technology, retailing and product/service fulfilment. These changes mean that yesterday’s CX program is not fit for purpose in 2022. In this post, I highlight 7 key shortcomings of CX programs.
1. Declining Response Rates
The number of people willing to do surveys keeps declining. There are multiple reasons for this. For example, too many people asking the same people, too often, to do surveys. Too many surveys are badly written, too long, and not sufficiently targeted. The participants have not been offered proof of value, for example, no feedback, no share of results and consequences.
There are no complete remedies, since the problem is fueled by the actions of others. However, you can mitigate the problems by showing proof of value, by improving your surveys (eg. shorter, better targeted, and relevant), and by avoiding overloading your customers.
2. Overuse and Overdependence on NPS
For many products and services, ‘Would you recommend …’ is not a relevant question (eg. computer operating systems). Different people use scales differently, for example, for many people an 8 means very good. Research has shown that NPS is not often causally linked to future profits, revenue or performance.
The future will depend much more on the open-ended comments gathered from customers. In terms of KPIs, the direction of travel is towards using algorithms to transform open-ended comments into metrics.
3. Perverse Incentives and KPIs
When bonuses are linked to KPIs, staff work to increase the scores. However, people quickly recognize that the quickest way to increase the score is to tackle it directly, rather than trying to increase the score by changing the service delivered. Examples of this phenomenon are staff pleading with customers to give them a higher score, or editing responses, or being selective in who is being surveyed.
The first step that companies should take is to de-link KPIs from bonuses, especially for anybody who can directly influence the scores. Shift the focus to outcomes that impact the business, for example, sales, profit, new leads etc.
4. Not Showing the ROI of CX
In 2022, every program needs to prove its return on investment. One of the problems with NPS is that it is not related to the ROI of the CX program. People are letting perfect be the enemy of good enough. Perfect measures are not possible, but there are plenty of ways of providing good measures of the ROI of CX.
The way forward is to focus on outcomes that matter, for example, sales, profit, downloads, test drives, cost of acquisition, and lifetime value. Focus on churn reduction, which is a key outcome that CX programs need to support. Measure the links between CX-related initiatives and business outcomes.
5. Too Much Auditing – Not Enough Change
Most CX programs measure how well some predefined plan is being executed. Features of this problem are CX being too siloed, CX being focused on collecting scores, and letting your CX program become stagnant.
The future for CX is to be an input into business process re-engineering. Integrate CX into the wider customer insight processes. Link CX programs to strategy development. Dive deeper, for example by utilizing T-shaped research. Keep evolving your CX program to meet your business needs.
6. Too Much ‘What?’, Not Enough ‘Why?’
If we want to use CX to improve the business, we need to know why some people are happy and why others are not happy. The problem of the ‘what’ is caused by focusing too much on KPIs, especially NPS. By focusing on the ‘what’, CX programs collect too little ‘why’.
The future is based on collecting more open-ended information. In order to leverage the open-ended information, we need to utilize AI and automation to process the open-ended responses. Different people have different needs, and organizations need to segment their customers and ensure they provide services that are tailored to people’s needs.
7. Letting Your CX Program Stagnate
Most CX programs were right when they were first created. The process of creating them was based on assessing needs and putting a program in place to meet them. However, from the day they were put in place, they started to stagnate. Programs that were designed before the pandemic, before the rise in new channels such as TikTok, and before today’s focus on topics such as inflation, are out of date.
The great trap for CX programs is to adhere too strongly to issues such as continuity and historical benchmarks. CX programs need to evolve to remain relevant and useful. Without change, your CX program will shift from being a strategic input to being simply a ritual that is performed out of habit.