Quality Assurance Engineer
Nowadays, the customer experience has an important role for the companies. To compete instrumentally, sectors must focus on the customer experience. The goal of customer experience management is to enhance relationships with customers and build customer loyalty. This report’s aim is to define how we can improve the customer experience and thus, how it can provide the maximum customer satisfaction. It seems that there is a lot of confusion in literature about the definition of “an experience” and difference of an experience from “a service”. Also, this paper clarified the customer experience definition and its differences to a service experience. As such, using the stages of Customer Experience Improvement may be useful both theoretically and in practice. In this paper we ensure a conspectus of the existing literature on customer experience improvement and expand on it to examine the creation of a customer experience from a holistic perspective.
Customer Experience Management is part of customer relationship management (CRM). Pine and Gilmore (1998 and 1999) were some of the first writers to address the notion of the customer experience. We can see also researches published by Carbone and Haeckel 1994, Schmitt (1999), and Johnston (1999). Nowadays, customer Experience is very become a popular in the world. Also, creating a strong customer experience is now a leading management objective. According to a recent study by Accenture (2015; in cooperation with Forrester), improving the customer experience received the most number one rankings when executives were asked about their top priorities in these days. Multiple firms, such as KPMG, Amazon, and Google, now have chief customer experience officers, customer experience vice presidents, or customer experience managers responsible for creating and managing the experience of their customers. Schmitt (1999) was one of the first scholars to emphasize the importance of customer experience, and Pine and Gilmore (1998) specifically address the importance of experiences in today’s society and the opportunities for firms to benefit from creating strong and enduring customer experiences. (Lemon and Verhoef, 2016)
This report examines customer experience and difference of an experience from “a service”. This paper provides an insight for designing, improving and assessing the customer experience.
There are two views on Customer Experience; operational view and service view. This article undertook to clarify that customer experience design and improvement in detail. Thus the objective of this paper is to research how organisations have gone about the designing, improving and investigating their customer experiences with an example of four different company in different sectors with multiple case study.
The research presented here explores and attempts to answer following questions according to case study
- Why is the customer experience important?
- What is customer experience?
- What is the customer experience design?
- Why did they want to improve the experience?
- What is the customer experience they were trying to provide? (for case study)
- How did they go about improving it? (for case study)
- What was the impact of changes? (for case study)
- What is the customer journey?
- What are the stages of road map for improving customer experience?
- What is the CEM Metrics ?
2. The Importance of the Customer Experience
Why is the customer experience important?
Providing well experience is important because it is directly related with customer satisfaction, loyalty and brand. It also creates emotional bonds with customer (Johnston & Kong 2011).
The increasing focus on customer experience arises because customers now interact with firms through myriad touch points in multiple channels and media, resulting in more complex customer journeys. Firms are confronted with accelerating media and channel fragmentation, and omnichannel management has become the new norm (Brynjolfsson, Hu, and Rahman 2013).
Understanding customer experience is critical for company. Despite all benefits, limited research in customer experience management area suggests that customer experience is not prevalent. Customer experience is based on perception and interaction. For example, a recent survey by Bain & Co. of 362 companies, across several industries and their customers, found that 80 per cent of the senior executives interviewed said they provided a superior customer experience, but just 8 per cent of their customers agreed (Coffman and Stotz 2007).
Customer experience management (CEM) has three major benefits: 1) Short term improvement in retained business and customers; 2) improvements in customer loyalty for longer term gain; and 3) the creation of competitive differentiation (Kirkby, Wecksell, & Berg 2003).
3. Customer Experience
What is Customer Experience?
Customer experience is the internal and subjective response customers have to any direct or indirect contact with a company. Direct contact generally occurs in the course of purchase, use, and service and is usually initiated by the customer. Indirect contact most often involves unplanned encounters with representations of a company’s products, services, or brands and takes the form of word-of-mouth recommendations or criticisms, advertising, news reports, reviews, and so forth (Meyer & Schwager 2007).
It seems that there is a lot of confusion in literature about the definition of “an experience” and difference of an experience from “a service”. To clarify this confusion, first of all definition of “a service” should be made (Johnston & Kong 2011).
So many services can be provided from a wide variety of organizations that includes business to business, business to consumer, the public sector and voluntary organizations. Therefore, it is not surprising that there is more than one definition of what “a service” is. (Haywood-Farmer and Nollet 1991, Sampson and Froehle 2006).Many services include some tangible elements (Johnston and Bryan 1993) but sometimes services are defined like something intangible (Gummeson 1987),
However, although there is no yet agreed definition of “a service” there is a beginning of an emerging consensus. “A service” is not a thing like product, on the contrary it is an activity with a process and it involves the treatment of a customer or something belongs to customer. Also, in this process the customer performs some roles in the productive activity. According to these definitions we can say that “service” is much more than the staff-customer interaction and customer contact (Chase 1981)
There are two perspectives on service: (see Figure 1) (Ding et al. 2010, Johnston and Clark 2008)
- The service provided from the operations point of view
- The service received from the customer point of view
In the operations point, Some resources like machines, devices, workforce, are used as inputs to design and provide the services together with the customer. Activities of operations (Process) provides an input in the service process. The service occurs where the operation and the customer meet (overlap in Figure 1) (This is sometimes referred to as the transformation process, Slack et al. 2010 or resource integration, Lusch et al. 2007
In the customer point, Outcomes of activities and experience of process creates a value for customer. Thus, Customer experience can occurs in the any part of during the process by the overlap in Figure 1.
The experience is entirely personal and depends on the customer’s interpretation. Therefore more than one person cannot have the same experience. (Pine and Gilmore 1998).
Experiencing a process results give a various emotions such as happiness, fear, shame (may range from) to customer. (Purves et al. 2001)
Results of experiencing a process includes how the customer have profited or gained the experiences of it with their overall satisfaction or dissatisfaction. Customer judgments will result in following intentions (Johnston & Kong 2011):
- the intention to repurchase
- the intention to not repurchase
- the intention to recommend it to others
- the intention to complain to related persons or not
Above mentioned intensions may not result in action. And also, these mentioned outcomes are given related with customer perspective. There are some outcomes such as strategic objectives and financial targets for operational perspective. (Johnston and Clark 2008)
Service quality is defined with two different perspectives:
Operational Service Quality:
Operational service quality is the assessment of how well the service is provided. This assessment method can be changeable according to company implementations, specifications or methods (as defined in operational procedures, training manuals etc, see Pinto and Johnston 2004).
Customer Perceived Quality:
Customer perceived quality may be changeable completely depending on the perception of the customer. It is related to the extent to which the customer’s expectation from the relevant service is met or the benefits the service provides to the customer (such as reliability, empathy, responsiveness, etc, see for example Parasuraman et al. 1985)
Above quality approach can be assessed in the terms of quality factors and dimensions. Providing the operational services quality does not mean that the results of customer perceived quality are satisfactory. In this sense there are two following reasons (Johnston and Clark 2008);
- Customer expectations affect the factors such as the prior use, cost, advertisement and brand.
- Customer expectations are personal and connected with personal experience, not connected with the service process.
4. Customer Experience Design
The successful implementation of the customer experience strategy requires attention and customer experience management. The company needs to be able to execute the strategy, oversee the project, and track the results. (Peppers & Rogers, 2017)
Although there is more research on service design, limited attention is received on customer experience design. (Pullman and Gross, 2004). However, various researches were conducted on this subject.
Several „operational? tools have been developed to help both design and assess the customer experience, including followings:
- Creating experience clues (Berry and Carbone 2007),
- Designing the „servicescape? (Bitner 1992),
- Customer journey mapping (Shaw and Ivens 2002 , Zomerdijk and Voss 2010),
- Service transaction analysis (Johnston 1999),
- Customer experience analysis (Johnston and Clark 2008),
- Walk-through audits (Fitzsimmons and Fitzsimmons 1994),
- Sequential incident technique (Stauss and Weinlich 1997).
Customer experience design is devided into several phases more historicly and starategicly approach. Carbone, Haeckel and Berry’s approach in the years of 1994, 2004 and 2007 are shown in table 1.
Multiple Case Study method is chosen in this paper because it concerns the implementation of a change process which takes place over a period of several years.
Four cases were selected to provide four different sector contexts (Johnston & Kong 2011);
The important reason why the organization mentioned above is chosen is to allow the organization to be observed in designing and developing activities of the customer experience over a period of several years (Karlsson, 2009).
The research designed contained a various combination of methods and multiple sources of evidence (suggested by Flynn et al. 1990); historical archive analysis, participant observation and unstructured, ethnographic interviews with senior managers and the members of team. Research gathered under four sub-questions:
- Why did they want to improve the experience?
- What is the customer experience they were trying to provide?
- How did they go about improving it?
- What was the impact of the changes?
The analysis of the wide variety of qualitative data collected involved several steps; familiarisation, reflection, data reduction, writing narratives of the changes, coding, conceptualisation, sorting and cataloguing activities and outcomes, and reevaluation (Easterby-Smith et al. 2008, Karlsson 2009)
The approaches of eight stages are taken by four several organizations to improve the customer experience , even though the way they carried out the stages were slightly different.
The eight stages of the improvement “road map” were; instigation and objective setting, coordinate and oversee the changes, undertake customer research, define the experience, undertake action research, priorities areas for development, develop and pilot the changes, and change the support systems. It also suggests that it is useful to have clear objectives in three areas: customer; staff; and cost efficiency; and use them to assess the benefits of improving the customer experience (Johnston & Kong 2011).
The following sections take each of the stages in turn and briefly define how the organisations carried them out. These findings are giving some point of the stages in Table 3.
6.1. Instigation and objective setting
Motivation of the first stage (Instigation and objective setting) varies among organizations. The improving the experience for carrier company and making differences in the market that was an opportunity.
Motivated after attending an event organized by a consulting firm specializing in customer experience, motivated senior executives claimed that many of their clients’ services were a highly emotional experience and that they ‘discovered’ that their customers wanted to feel more engaged with the company.
The important feedback for this organization was that it had mainly given a point to shareholders it wanted to increase its return on sales by ten per cent and the directors hoped that this initiative might commit to that.
In the bank, managers also perceived an opportunity for making differences the company. They were looking for a new idea while they had worked long years developing their culture, values and processes. Again after being exposed to the work of a firm of consultants, they recognized they had the capability to provide quite a different experience than that of the competition (Johnston & Kong 2011).
For both of these organizations there was no underlying „business plan? that suggested or expected these initiatives to reduce cost but it was done simply in the belief that they might at least maintain revenue levels and even increase them (Johnston & Kong 2011).
This was at the third phase for creating an advantage which was given a response to major problems. Indeed the regulator had threatened to remove their operating license. Although the first two phases were part of the initial “recovery” plan, this third phase emerged as a natural progression to the goals of being the best in the industry, again in response to input from consultants.
While in essence the motivation was differentiation (i.e. better than the rest of the industry) there was a clear objective to make it a better place to work for the staff, to increase their pride and job satisfaction (Johnston & Kong 2011). Also, it can real advantage to reduce cost. Even though there was no business plan, they belived that it was the right thing to do.
The hospital?s approach was instigated by psychology academics and a health service improvement body spurred on by the NHS Improvement Plan 2005 and later by the Public Sector Transformation Programme 2007. These related government documents inspire public sector organisations to improve the experience they delivered to „customers? and also reduce costs. There was still no business plan existing (Johnston & Kong 2011).
There was still no business plan existing and there was also no clear strategy as to how they would go about improving the experience. Those who pioneered these events were allowed to develop as they progressed. (Johnston & Kong 2011).
6.2. Coordinate & Oversee The Change
The second stage is Coordinate & Oversee the changes which took a very similar approach in all the organisations. They all created small high powered teams (referred to here as Experience Teams) based centrally (at HQ) in the multi-site organisations to oversee, encourage, and coordinate the programme (Johnston & Kong 2011).
For making the changes , the teams did not see themselves responsible but for overseeing the changes and encouraging involvement, with the exception of the hospital.
On the other hand, they took over responsibility for communication and strategic planning.
Altough the hospital was a smaller operation, the team was actively supported in bringing about the changes.
The courier company appointed a Chief Experience Officer (CXO) to head the team which reported directly to the board . For the bank the remit was given to the Chief Operating Officer (COO) .The responsibility in the utility was given to the Head of Customer Service and the hospital set up a high- level advisory group which comprised a number of the most senior managers (Johnston & Kong 2011).
6.3. Undertake Customer Research
All the organisations? Experience Teams undertook customer research to help inform their improvement approaches and activities. Two reasons were given for this activity, one explicit and the other was not stated to staff. The first reason was to gather data from customers primarily so that the organisation could better understand the experience their customers both currently received and would appreciate (see next section). The second reason was to change the mindset of the staff and managers. The Experience Teams in all the organisations believed that the biggest barrier to change was not a lack of resources but getting their people to see their services from the point of view of the customer, outside-in (Price and Brodie 2001 and Johnston 2008), i.e. the customer experience (Johnston & Kong 2011).
The customer research was therefore not conducted by the Experience Teams. Instead managers and staff were encouraged to hold customer forums and interviews, and undertake journey (touch point) mapping. Typical questions asked of customers included; what do you need, how would you like us to behave, what would make the experience excellent, how well are we doing, what’s not quite right, and what works well. The focus was on getting anecdotal data including emotive statements, positive and negative, from customers to help galvanize the need for change in the organisations (Johnston & Kong 2011).
The hospital also involved patients and offered those video cameras, still cameras and paper to capture and then share their experiences with the Experience Team. All the organisations? Experience Teams supplemented their research using external agencies to collect industry-wide data. The courier and the utility companies, for example, commissioned external organisations to undertake consumer research, across sectors, to better understand the experience and emotions that consumers in general expected from service providers and the relative importance of each of them. The utility, for example, found two sets of factors (corresponding to satisfiers and dissatisfiers – see Johnston 1995) which they called physical and emotional (Johnston & Kong 2011).
The physical factors being things like reliability, value for money, responsiveness and problem solving – with reliability being the most important) and the emotional aspects being trust, assurance, care, valued, for example, with trust recognised as the most important (Johnston & Kong 2011).
6.4. Define the experience
Based on the data collected from the previous stage, all the Experience Teams then developed „customer experience statements? (Shaw and Ivens 2002) articulating the nature of the customer experience their organisations should be providing from the customer’s point of view at the various touch points during the customer’s experience. These statements included the emotions that the organisations agreed they wanted their customers to feel. Developing these statements were significant tasks and all the organisations made a point of holding facilitated sessions with the Experience Teams, senior managers and in the case of the hospital, patients as well, to generate the statements. The courier company used a two-day management team meeting, the other organisations held a series of meetings, often over a period of months. The techniques employed included the teams undertaking journey mapping themselves, emotion mapping (see Johnston and Clark 2008), listing and voting for the desired/required feelings (using yellow stickies). The sets of emotions that the organisations felt they should engender in their customers included, in one organisation, empathy, trust and understanding and in another special, valued, understood and assured. Discussing emotions did not come easy in any of the organisations. One Experience Team leader admitted that he would previously have dismissed as mad any notion of him talking about creating feelings in customers with his fellow senior managers. One example of an experience statement, in the case of the utility company, was; always receive proactive communication, always treated as special and valued, given a personalised service, never suffer from disruption due to road works, with high levels of trust. In all cases the experience statements were written from the point of view of the customer (outside-in) and not from the point of the organisation (inside-out) i.e. “the customer will get/see/feel” rather than “the organisation will provide” (Johnston & Kong 2011).
6.5. Prioritise areas for development
Based on their learning from the customer research and the development of experience statements the Experience Teams then set about identifying areas for change, assigning priorities (with senior managers) and also agreeing how the projects and work streams would be managed. In all cases the Experience Teams set up project teams employing project management methods. Their remit was not to redesign processes but to undertake action research to enable the redesign to happen „bottom-up? by getting ideas from the people involved in service delivery (step 6) then help them develop and implement the changes (step 7). One piece of action research in the courier company, for example, found that if a driver was expecting to be say 20 minutes late for a pick up or drop-off s/he had to ring their control to report it. The controller would then contact customer services, who would then contact the customer. By which time the driver would be at the company being berated for being late. This process also undermined the, usually, long-standing relationship the driver had with the staff at the company. The process was changed so that the drivers could contact the company directly and as soon as they knew they might be delayed (Johnston & Kong 2011).
6.6. Undertake action research
In line with the implicit objective outlined in step 3, to change the mindset of the staff and managers to outside-in, the Experience Teams recognised that to bring about the desired improvements the ideas had to be driven from the people involved themselves, encouraged by the Experience Teams and facilitated by the project teams. The objective of this phase, undertaken by all four organisations, was to help staff/providers understand the experience they were delivering, and their customers were actually receiving, and then involve them in finding ways to improve those experiences. The key tools that the Experience Teams provided to support the project teams were customer journey mapping, observation, walk-through-audits and emotion mapping. The intention was not to focus on internal flows but the processes and experiences from the customer?s point of view (Johnston & Kong 2011).
There was a realisation that many of these flows cut across traditional functional boundaries and project teams were adjusted to bring in a wider set of expertise and responsibilities in order to focus on problem solving through collaboration with others. The intention here was not upon obtaining information from customers but rather allowing staff and managers to „experience? the customer’s experience. Emotion mapping was particularly helpful here, also referred to as behavioral mapping, which asks staff to map out the customer journey then add how they think the customer feels at each point in the process (Johnston & Kong 2011).
In the case of the hospital, staff realized that at various stages patients would feel embarrassed (when part of their treatment took place in the waiting room in full view of other patients), out of control, when they were told what would happen to them, and anxious, cross and upset when they had to wait, without explanation or indication of the length of time, in the waiting room for critical test results. Three of the organizations (not the hospital) also encouraged staff and managers to look at the experiences provided by other (quite different) organizations. In the courier company and the utility this comprised of management benchmarking tours. In the bank small groups of staff were given tasks to „mystery shop? other organizations and report back. This latter method was reported to be highly successful in changing mindsets because by assessing other organizations first staff were better equipped, more able and more open-minded) to critique their own organization (Johnston & Kong 2011).
The bank small groups of staff were given tasks to „mystery shop? other organizations and report back. This latter method was reported to be highly successful in changing mindsets because by assessing other organizations first staff were better equipped, more able and more open-minded) to critique their own organization (Johnston & Kong 2011).
6.7. Develop and pilot the changes
These two activities were closely linked and iterative, and essentially one single stage. The project teams encouraged and collected ideas to deal with the issues the managers and staff identified and then helped them test them out in their own areas/departments and obtain feedback from staff and customers. If the changes were judged successful by the project teams, after any adjustments, the Experience Team would then take responsibility for coordinating the changes across the organization/department and ensuring that appropriate training was provided by the appropriate department.
The bank, for example, after a trial in several branches, changed its process for dealing with customers wanting to open a new account. Instead of this task being allocated to one individual (who was often not available – on break, on the phone etc) everyone was trained to deal with account openings so that there was no delay in signing someone up. “Come back later” was not the right experience for the customer (Johnston & Kong 2011).
6.8. Change the support systems
Many small but significant changes resulted, some of which required wider and deeper infrastructural changes in the organization. The Experience Teams established that besides sharing the changes across the organization they had to change structural systems and processes, in particular revise training plans to take account of the changes but more importantly to change to customer-based measures to reflect the new customer focus, and then align measures and reward systems to support them (Johnston & Kong 2011).
The water company, for example, relied on „percentage of non-major problems fixed within eight days? as a measure of its response to customers with a non-urgent problem. On the face of it this is similar to many organizations? repair measures but it is inside-out. While it might, at first glance, appear more efficient for the company to have a longer time period in which to schedule their work, it is quite unhelpful to the customer who has no idea over the next eight days when the operative is likely to arrive. So s/he either has to stay in for up to eight days or go out or to work and risk missing the operative (thereby making the process inefficient for the company as resources were frequently allocated to jobs where access could not be gained). The company introduced an integrated computerised scheduling system which enabled the operator to make specific promises with a narrow time window.
Two additional Stages can included to above mentioned stages. One of them is –build the business case- in the first stage, the other one is assessing the impact of the change programme at the end of the stages. (Berry and Carbone 2007)
A Ten Stage Road Map is proposed by Berry and Carbone (2007) as a result of ‘monitor execution’.
The literature also identified a followings to improve the customer experience;
- Focus Groups,
- Emotion Mapping
- Process Mapping
- Service Transaction Analysis,
- Customer Experience Analysis
- Walk-Through Audits,
- Journey Mapping
Driving the Customer Experience Management:
Six Big Ideas from Strategic Customer Service:
- Straff does not cause most customer dissatisfaction – sales, products, processes and customers do
- It is cheaper to give great service than just good service, the revenue payoff is 10-20X the cost
- People are still paramount – make the front line successful with flexibility and clear explanations
- Deliver technology that customers will enjoy – delivering psychic pizza via any channel
- Sensibly create remarkable delight
- An effective voice of the customer managed by a Chief Customer Officer has many kinds of data
7. CEM Metrics and Measurement
In the past, enterprises have operated using operational cost efficiency metrics and top-level financial performance metrics. For CRM and CEM, these operational and strategic metrics have to expand to include customer value metrics. These show the value obtained from customer management both to the enterprise and, most importantly, to the customer. Including metrics such as key performance indicators focuses the business on achieving goals that are based on delivering customer value. Metrics should be linked throughout the business at all levels in cause-and-effect chains via the business balanced scorecard. This links metrics at the input level to operations, then to strategy and then, finally, to the enterprise financial goals, plus market position and brand image targets — all of which are important for CEM. In some situations (e.g., business-to-business), it will also be relevant to have individual service level metrics for customer contact (see Figure 3). Figure 3 shows the metrics at each level that are most important for improving the customer experience. (Kirkby, Wecksell, & Berg 2003).
The most important metrics in CEM are the brand experience dimensions at operational level. These can be monitored on a daily basis and can be used quickly in decision making to transform the customer experience into one that is building up the value of the customer at each contact. Brand experience dimensions should be those elements of the enterprise’s image and service that customers really care about and which, if delivered well, build up that feel-good factor and loyalty. Each brand experience dimension should have an owner, so that when it is shown to be falling below customer expectations, there can be a fast analysis and reversal of the situation. Fixing a brand experience dimension will likely involve processes in a number of functions, so an owner is needed to drive the necessary change. CEM metrics require feedback channels to be opened and a feedback loop established — from the operational part of an enterprise back into its strategy — to keep it alive and able to unify the organization. At the same time, feedback provides the information to manage the customer experience at a more individual and personal level. In the future, these feedback loops will be built into the organization’s metrics systems (i.e., its business balanced scorecard and individual service standards). (Kirkby, Wecksell, & Berg 2003).
8. Mapping the Customer Journey
Left to their own devices, companies will continue to operate with an internal focus. That’s why we recommend that organizations use customer journey maps — also known as touch point or “moment of truth” maps — to examine interactions from their customers’ points of view. Forrester defines customer journey maps as: Documents that visually illustrate customers’ processes, needs, and perceptions throughout their relationships with a company.
The customer journey mapping process requires five steps (see Figure 4) (Tempkin, 2010):
Firms need to translate their analysis into a simple visual representation of customer processes, needs, and perceptions — creating their journey maps. Customer processes provide the primary visual framework (Tempkin, 2010).
With internal and external research in hand, journey mapping leaders need to distill their findings about how customers interact with the company, what they want from each interaction, and how they feel about each interaction today — the three key elements of a journey map (see Figure 4) (Tempkin, 2010).
This report has defined how the organisations design and to improve the customer experience and to provide the maximum customer satisfaction. The paper has provided some contributions to literature such as define the customer experiences and its difference to a service and also, insights for customer experience change model. This researches have developed the stage models for road map and has enhanced loyalty and competitive advantage. Also importantly, it gave an important experience for the customer: cost reduction and efficiency gains. i.e. “triple bottom line”
Importantly, the customer experience has defined in three areas: customer, staff and cost efficiency. Using those areas has provided some benefits to customer experience improvement
This study has provided a road map which organisations can use as a base for improving their customer experiences. It is also suggested that it is useful to have clear objectives in three areas: customer, staff and cost efficiency and use them to assess the benefits of improving the customer experience.
This paper also aimed to introduce the literature of customer journey and gave some information for five steps to map the customer journey.
As a result the customer experience is a business issue. A poor customer experience can put relationships at risk and promote defections. Thus, the companies may tend to design, improve and assess the customer experience activities.
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