Better customer experience starts where CRM ends

I had the pleasure of presenting at Gartner’s 2019 Customer Experience and Technologies Summit in London recently and thought I would share some of the main themes that I picked up from attending the various sessions, plus discussions with event attendees:

(NB - Please note these are my personal thoughts and impressions)

1.   A better customer experience starts where CRM ends

It’s no coincidence that this was the title of my presentation at the Gartner CX event. My summary view on this is that CRM is a broad set of solutions covering sales, marketing, e-commerce and customer service.

In customer service, traditional CRM really stands for Call Reaction Management, and that is simply not good enough to deliver great outcomes for either the customer or the organisation providing the service. At ServiceNow, we believe there’s a better way, and we call it Customer Service Management. ServiceNow® Customer Service Management effectively brings together 4 key components on a single, cloud-based platform:

• Omni-channel customer & partner engagement; drive action with self-service
• Connect the back-office to the front-office; resolve complex issues end-to-end
•  Connected devices and IoT; provide proactive service
• Use Enterprise Service Management principles

It was great to see the level of interest in Customer Service Management at the event – both from happy existing customers of the solution, and prospects who were really interested in its differentiated proposition.  Exciting times ahead!

2.   An increased focus on business outcomes

Customer experience (“CX”) is beginning to come of age, and as a result, organisations are asking more and more questions about how the CX directly impacts on a company’s performance, or putting it another way, what is the return from making additional investments into CX.

Time and again, my discussions with organisations are about 5 broad categories of business outcomes or business drivers that are driving CX activities:

1. Improving customer satisfaction
2. Improving employee engagement and satisfaction
3. Cost and efficiency improvements
4. Innovation and business agility
5. Compliance (both regulatory and operational)

But the challenge for everyone is to link these broad areas of focus into tangible KPIs and metrics, and then to directly link them to a business case and financial performance.

Gartner’s analysis shows that 50% of organisations are already using financial metrics to measure ROI on CX improvement projects, with a further 24% using (non-financial) business metrics, and the trend for both categories is increasing.¹  If you’re not using either of these to measure the effectiveness and impact of your CX activities, you need to think again, and quickly.

3.  What you do next in CX depends on where you are starting from

I call this ‘where are you on your Stairway to Heaven?’:

In the opening keynote Gartner presented ‘nine strategies for CX victory’ which I liked a lot²:

• 3 proven practices
  • Move from chaos to co-ordination
  • Make individuals accountable
  • Set one direction
• 3 surprising successes
  • Don’t delight but be effortless. We take this as drive for an effortless customer experience
  • Don’t innovate but imitate
  • Don’t correlate but help jobs to be done
• 3 bold behaviours
  • Radically reduce the number of products being sold/supported
  • Select 1 or more processes to be an order of magnitude faster
  • Invest to enable employees to have more digital dexterity

4.   Self-service is going mainstream

Self-service solutions are not new, but in the past they have typically been ‘add-ons’ to customer interaction channels like voice, chat and e-mail. But Gartner’s analysis³ seems to me to indicate that self-service is starting to be the primary channel for a number of organisations:

• 8% of customer service leaders believe that at least 20% of current ‘live’ customer service volumes can be handled by self-service. 15% of these same leaders believe that 60%+ of the volume can move to self-service.
• 38% of customer service resources are already being applied to self-service channels (e.g. implementing things like Knowledge Centered Service®)
• Gartner says there are 3 eras of the service function:
  • Era 1: Live service-dominant strategy
  • Era 2: Self-service as an add-on
  • Era 3: Self-service dominant strategy

5.    As a CX vendor, on which personas/functions in an organisation should I focus on?

Gartner’s analysis shows that CX measures can occur in almost all areas of a typical organisation, but that the ranking is as follows⁴:

i.   Customer satisfaction @ >95%
ii.   Loyalty churn retention @ >90%
iii.  Advocacy brand reputation @ >70%
iv.  Quality operations @ <50%
v.   Employee engagement @ <10%

In addition, Gartner’s research shows that CX’s position in the overall business priorities amongst different classes of executives is as follows⁵:

• CX is the number 1 business priority: Customer Service, Marketing
• CX is 1 of the Top 3 business priorities: CEO, Operations, Sales, Strategy
• CX is 1 of the Top 5 business priorities: IT

In order to be successful selling CX solutions, vendors need to go ‘broad’ across departments/functions, but go especially ‘deep’ in the areas of Customer Service/customer satisfaction and Marketing.

6.   How important is CX to organisations?

A variety of surveys undertaken by Gartner, covering different functions/roles, highlight the overall importance of the Customer Experience to most organisations.

From the Gartner CIO survey⁶:

• CX is the heart of 55% of business model changes
• 75% of ‘top performers’ report having changed or are actively changing their business model
• 73% of these changes are driven by customer centricity

From a Gartner survey of CEOs, 63% say that their companies are likely to make changes to the business model in the next 2 years.

And finally, Gartner’s survey of CMOs showed the following:

• 60% 2 years ago, 67% today, and 81% in 2 years, of marketers responsible for CX say their companies compete mostly or completely on the basis of CX

7.    What’s this AI thing?  Is it important or relevant?

AI – Artificial Intelligence – is undergoing rapid growth and being deployed in more and more areas of customer service and the overall customer experience.

And the folks at Gartner have some other predictions about AI over the next few years: which I think are bold about just how much of an impact AI is going to have on both businesses and consumers:

• By 2020, 30% of all B2B companies will employ AI to augment at least one of their primary sales processes.⁷
• By 2021 15% of all customer service interactions will be completely handled by AI, an increase of 400% from 2017.⁸
• By 2022, 40% of customer-facing employees and government workers will consult an AI virtual support agent daily for decision or process support. ⁸
• By 2023, 80% of organisations using AI for digital commerce will achieve at least 25% improvement in customer satisfaction, revenue or cost reduction.⁹
• By 2025, customer service organisations that embed AI in their multi-channel customer engagement platform will elevate operational efficiency by 25%.⁹

Summary:

Fascinating to see the whole topic of CX mature, and the discussions focusing more on more on business outcomes and driving real value for both customers and organisations. I am sure many of us will be keenly watching to see if Gartner’s predictions about the rise of AI will pan out.

And of course, it was great to meet so many existing ServiceNow customers at the event, whether currently using our other solutions (predominantly IT and HR workflows) or already using Customer Service Management. 

Looking forward to attending again next year!

1. Gartner Event Presentation, How to Measure and Build the Business Case for Customer Experience, Ed Thompson, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
2. Gartner Event Presentation, Gartner Keynote: Three Bold Strategies for Customer Experience Victory, Don Scheibenreif, Ed Thompson, Michael Chiu, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
3. Gartner Event Presentation, Delivering on the Digital Experience: Building Customer Confidence to Resolve Without You, Richard DeLisi, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
4. Gartner Event Presentation, How to Measure and Build the Business Case for Customer Experience, Ed Thompson, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
5. Gartner Event Presentation, Gartner Keynote: Three Bold Strategies for Customer Experience Victory, Don Scheibenreif, Ed Thompson, Michael Chiu, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
6. Gartner Event Presentation, Gartner Keynote: Three Bold Strategies for Customer Experience Victory, Don Scheibenreif, Ed Thompson, Michael Chiu, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
7. Gartner Event Presentation, Top Technology Trends and Their Impact on Customer Experience, Don Scheibenreif, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
8. Gartner Event Presentation, Leverage the AI Capabilities in CRM for Better Business Outcomes, Brian Manusama, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.
9. Gartner Event Presentation, Plan for the Digital Future — The Revolution in CRM Technologies and Their Impact on Your Customer Strategy, Olive Huang, Gartner Customer Experience & Technologies Summit, 22-23 May, London, UK.