The Voice of the Customer (VoC) marketplace is an area that has grown tremendously in the past 10 years with the evolution of feedback technology and as differentiator for brand loyalty.
A 5% increase in customer retention can increase company revenue by 25-95%, according to Bain and the Harvard Business Review. Improving customer journeys also lowers the cost to serve up to 20% (McKinsey).i The financial gains will drive companies to continue to make customer
experience a strategic priority as buyers are willing to pay more for a great customer experience.
VoC Programs are not only a differentiator as customers expect superior customer service to impact brand loyalty but also have a real financial impact by understanding the lifetime value of your customer, reducing customer churn, improving sales, and increasing the wallet share for your brand. Companies who successfully execute on their VoC program attain 10 times greater year over year increase in annual revenue. However, attaining the financial gains of strategic CX program is not achieved by enough companies which is the motivation for this white paper. Based on
Forrester’s 2020 research below, CX practitioners are still struggling to have the impact they desire. There is a huge gap between customer expectations and a company’s ability to impact their
The Execution Challenge
We like to call this outcome "The Execution Challenge" where the expected results of a formal VoC program are never realized due to several seen and unforeseen obstacles faced by CX professionals. Outlined below are the common challenges we have seen time and time again leading to the Execution Challenge pitfall.
Common Challenges to realizing the CX investment and positive impact”:
1. Missing a top down governance program design which includes collaboration and support from all the operational business unit stakeholders involved on the customer journey.
2. Lack of executive alignment and support for the VoC Program
3. Siloed organizational initiatives and partial view of the customer
4. Inability to impact and engage employees
5. Decentralized VoC programs with multiple vendors, KPI’s and designs
According to Gartner, for those companies that have a CX program with lower maturity levels, “60% had CX initiative launches stalled due to lack of executive support, and 59% found it difficult to demonstrate value or ROI, which leads the CFO to question all future investments.”ii
Most executives do not understand the VoC discipline and when CX leaders are missing a top down Governance framework this directly affects the credibility of the program along with the financial gains and goals of the program which is why the balance of this whitepaper focuses on VoC Governance.
When we discuss 'governance frameworks' in relation to Voice of the Customer programs, this means making strategic and operational business decisions based on your customer feedback and understanding what is driving those experiences on the journey with your brand and understanding what interactions can impact loyalty positively and negatively. To accomplish this, you must have C-level support with a top down governance framework along with executive alignment across all business units to impact your customer experience, culture, communication, operational improvement, training, and your business revenue outcomes. Many organizations have multiple VoC programs with different designs and vendors that sit in silo’s which accounts for the other 3 challenges above. Having decentralized programs negatively impacts your ability to impact the customer experience, engage employees and achieve the financial gains intended. Fundamentally these programs fall apart at change management which is key in avoiding the “execution challenge.”
Governance Framework Attributes
Since top down executive alignment and collaboration are key to the VoC program success and impacting business outcomes, a successful VoC program includes a robust governance framework that encompasses the 5 attributes below covered in the remaining sections of this whitepaper:
1. Program Governance Design
2. Executive Alignment Strategy
3. Communication Strategy
4. Closed Loop Program
5. Change Management Framework
1. Program Governance Design:
When building your VoC program, especially in a large organization where shareholders and executives expect an impact on revenue, gaining executive support and alignment on your CX decision making framework will be key to the program success. Executives desire governance frameworks to support measurable improvements and a superior operational experience so CX Practitioners need to advocate for their program to make it a top down initiative. To have the financial impact from your CX program, stakeholders from every organizational business unit need to be aligned on the program goals, design, communication strategy, service recovery strategy and change management plans for their business unit.
According to Gartner “49% of marketers say their functions are solely responsible for VoC activities which does not support an enterprise cross-functional governance strategy for large organizations that is needed. “iii
The “execution challenge” is first manifest with unaffiliated decentralized program designs managed by one or more departments with no governance design or common framework.
Having alignment means every organization unit participates in the VoC program and this is still missing for most programs. For example, a common challenge is linked to the digital strategy and the contact center which is a Hub of VoC data, yet it is quite common that the digital and e commerce teams do not work together with customer service even though they directly impact each other. All these challenges are very common in the "execution challenge" and why a top down governance framework is key to the success and financial impact of your program.
It is also important to consider your company culture and stated brand promises in terms of the maturity of the organization and the role customer feedback plays in executive decisions. The level of maturity will denote what kind of governance structure is required to help the culture mature and ensure that superior customer experience is a top down initiative. Your CX Program should make your brand promises actionable and improve business outcomes.
This is also crucial when executives or CX leaders leave the organization so that your CX program success is not dependent on one executive but has an established, long term framework new CX leaders can leverage as they transition into the company.
Following is an example of a customer success story where a top down governance framework set up their VoC program for success to impact loyalty, revenue growth and positive business outcomes.
NICE Satmetrix Rental Services Customer Example Framework: This top down governance framework was based on a model appointing a CX Champion to create a committee made up of leaders throughout the organization. This committee was then tasked and committed to immersing themselves in the CX marketplace and understand how to have a successful program. They also were training certified through the NICE Satmetrix NPS Masterclass to establish a program to correlate loyalty with revenue growth and positive business outcomes. They also deployed an effective communication strategy to empower the front lines to make the data actionable and create a culture of feedback.
Exchange Bank’s strong customer focus led them to search for a customer experience management (CEM) platform and system that could help it better connect with its local retail and business customers. To kick off its initiative, the bank formed a customer experience (CX) committee made of up leaders from throughout the organization. Beth Ryan was the newly appointed VP of Customer Experience. For Beth’s first objective she and the VoC committee set out to immerse itself in the CX field and learn everything it could about the discipline and its practical applications. That quest led it to NICE Satmetrix and its Net Promoter Certification training. To read the whole story: https://www.satmetrix.com/customer-success/pdf/exchange-bank/
2. Executive Alignment Strategy:
The first requirement of an effective VoC governance design is having top down support where executives see the value of making decisions based on customer feedback. It is the executive alignment that helps to support the program and creates the nuts and bolts of the framework and enlists all the stakeholders from all business units. In the sample governance design below the CX leader has support from the executive leadership team along with the CX program team and they are all connected with the stakeholders of each business unit to support the program. Not having executive support for a governance framework is like building a house without a blueprint. Without a supported framework, there will be major infrastructure problems and gaps, so any
recommendations will be lacking in engagement or support and will be unable to deliver the financial benefits of a feedback program.
Sample CEM Governance Design for Executive Alignment Below:
3. Communication Strategy:
Communication about your Voice of The Customer Program is what brings your program to life for your customer and employees,so it is a crucial piece of a successful VoC governance framework. How the VoC program is engaging your employee’s and executive communication about the program within your organization needs to be agreed on from a top down approach which is why it is part of the governance framework. Is marketing and branding engrained to incorporate all the business unit
stakeholders and front-line employee engagement of the program to drive outcomes? This sample framework below outlines the top down engagement and sharing of data that gives your program visibility and the impact its designed to have.
When thinking about your communication strategy and how employee engagement supports your VoC program, understand that your contact center and front-line staff are the primary communicators of your CX values for all customer touch points. Strategic organizations are creating a culture of innovation, by empowering their front-line staff to share feedback on an ongoing basis as they see problems and solutions to support organizational goals.
A strong VoC communications strategy should effectively reinforce the governance framework and stakeholder alignment to support the closed loop process, change management and employee engagement in your CX program. For your customers and employees sharing what changes you have made based on feedback will reinforce a culture of feedback and make your customers feel like they have an impact and you are truly listening to their feedback.
When thinking about your current VoC Communication Strategy ask yourself: • Is customer experience supported and engrained at every level of organization? • Have we internally branded and marketing our VoC program to elevate awareness and visibility?
• Is there a culture of feedback where employees are encouraged and empowered to go above and beyond for your customers?
• Do employees share knowledge and work together across teams/functions to drive CX improvements from a customer segment perspective?
• Is customer and competitive insights sufficiently detailed to understand risks and deploy action accordingly?
• Is employee feedback used to reinforce understanding of customers and set business priorities. • Is there a need for Voice of the Agent or Voice of the Front-Line Program?
• Are employees rewarded and recognized for customer success and are their interactions transparent to the organization.
• Are your KPI's aligned with your brand promises to your customers and business financial goals? • Do you share changes made based on feedback with your employees and customers?
These factors will determine the level and cadence of communication, training and support needed at the distinct levels of your organization to support your program kickoff, and/or re-alignment goals to ensure your VoC program is effective. Everyone is at a different point on their VoC program evolution so assessing this will help determine your communication strategy and support needed.
Making the data actionable to support a superior experience, brand loyalty and business outcomes is the goal. This communication structure and will support the right team members for performance management and training your front-line agents, along with change management to ensure your program is actionable and creating a superior customer and employee experience.
4. Closed Loop Program:
Service recovery is an essential part of any VoC program, in making the data actionable, reducing churn, and creating a superior customer experience. Whether your company’s market is B2B or B2C, creating a cadence for follow up with your customers will be very important. The Governance Structure around your closed loop program ensures that it is effective and well utilized. A great VoC Technology Platform can customize the closed loop workflow across the organization so all team members can see the data that is relevant to them and their ability to directly reach out to customers and resolve any issues.
You must follow up on the feedback shared by customers for your program to be effective and have longevity in driving real CX improvements. Moreover, following up and gathering root cause to gain an understanding on what are your loyalty drivers and what are the "moments of truth" for your customers, will help your organization understand where to focus service recover efforts and what follow-up has the biggest impact on customer loyalty.
Your closed loop program will also support operational touchpoint leaders to improve the customer experience as shown in the diagram below, while also aligning your training department to help improve your front-line staff’s effectiveness with your customers. It will also support your performance management teams on the front lines in coaching agents with real customer examples. Your service recovery cadence should vary based on your organizational brand promises, customer expectations, account value and segmentation strategies.
Example of Closed Loop Design Below:
Multiple communication loops are created in an effective program. Therefore, customizing your VoC Program to deliver insights that are relevant to the individual team members is key:
• Internal loops across your organization
• Front line employees
• Training department
• Functional leaders across touchpoints
• Operational leaders to support change management
• External Loop with your customers:
• Proactive feedback- reaching out to customers to share changes
• Reactive feedback-Follow up on negative feedback or problems with the relationship • B2B- follow up with multiple stakeholders and tiered approach on follow up depending on the client segmentation
• Follow up with your clients to let them know what organizational changes you are making internally based on their feedback
5. Change Management:
Collecting data through your customer feedback program is the first step to a successful program but making it actionable through change management is what puts the governance structure into practice and brings your CX program to life. This is also the most difficult aspect of an effective
framework due to cost, impact to established process, resistance to change and lack of support so this is where most customer experience programs fall apart. A top down governance framework must be in place to impact the organizational and process changes required to deliver a better customer experience. This executive alignment from stakeholders across all business units will help prioritize and manage the change process while also engaging the training department to support the changes made and create the training needed to support the operational and behavior changes needed to impact the experience, loyalty and business outcomes.
Using analytics to understand your loyalty drivers will help support change management and prioritizing your efforts with operational changes needed across the customer journey. This data will help you determine which interactions have the greatest impact on the experience and business outcomes. The stakeholders within each business unit need to attach the needed changes to specific employees to make it actionable and share what changes were made internally and with customers.
Change Management Best Practices Approach:
• Establish a governance framework with executive alignment and touchpoint functional leaders are engaged to make and assign changes based on customer feedback. • Customer journey and feedback program are mapped across all departmental stakeholders including sales, onboarding, implementation, customer support, digital channels, e-commerce, account management, product management, training, and finance to understand the experience at each touch point and where changes are needed based on which interactions that will drive loyalty for your brand.
• Closed loop framework is set up, approved, and deployed based on your brand promises and service KPI’s.
• All departmental leadership are aligned on a centralized VoC program goals with all data inputs to support the right changes.
• Operational support is established to align functional changes with team members and timelines to ensure changes are made.
• Functional team leaders use customer data as key topics for ongoing training and development with front line agents and managers.
• Customer master data management and legacy systems are aligned with customer service teams to effectively support customers.
• Getting the right tools in place to ensure that automation is aligned with human process for the front lines and management will help advance your teams to support a superior customer service.
• Customer comments are used to support coaching and training.
Customer experience should be a strategic priority and can be a huge differentiator for your organization and have a significant revenue impact on the lifetime value of your customer, reducing customer churn, improving sales, and increasing wallet share for your brand. Customer expectations have skyrocketed beyond most company’s ability to deliver, so your VoC program must catch up to ensure brand loyalty and positive financial impacts.
Executives use governance frameworks to be effective in their roles and to create operational excellence and a superior customer service. A governance framework will give your executive team the confidence
in your CX program so you can gain executive alignment and collaboration needed across all business units. Without this, executives will not trust the program or data and your program suffer from the “Execution Challenge.”
CX practitioners advocate for your program and know that executives need governance frameworks to support their business goals. So, take your program to the top by getting the support you need to have the impact these programs are designed to have.
We at NICE Satmetrix are here to support your Voice of The Customer program design needs with the strategy and methodology for deploying a robust governance framework. With a best practices-based design and framework in place, we can recommend the best alignment with our leading NPX technology platform to ensure your teams are able to overcome the “Execution Challenge” and successfully deliver a superior experience for your customers that significantly improves loyalty and real business outcomes.
i Gartner: Laura Starita, Jan. 11, 2020 https://www.gartner.com/en/marketing/insights/articles/3-key-findings from-the-2019-gartner-cx-management-survey