Chief Customer Officers Must Orchestrate Experiences

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Customer Engagement
Customer Experience
Over the past seven years, Forrester has observed the trend of companies putting in place a senior executive responsible for leading customer experience efforts across a business unit or an entire company. Whether firms call them a chief customer officer (CCO) or give them some other label, they are sitting at the highest levels of their companies and exist in both B2C and B2B companies as diverse as GM, UnitedHealth, Fidelity, Level 3 Communications, and Eli Lilly.

Over the past seven years, Forrester has observed the trend of companies putting in place a senior executive responsible for leading customer experience efforts across a business unit or an entire company. Whether firms call them a chief customer officer (CCO) or give them some other label, they are sitting at the highest levels of their companies and exist in both B2C and B2B companies as diverse as GM, UnitedHealth, Fidelity, Level 3 Communications, and Eli Lilly.

Here are some of the findings from this year's research on this emerging position:

- 55 percent of these leaders are internal hires with significant histories at their companies -- the median time at their firms among those we studied is more than seven years.

- 85 percent of the CCOs sit on the executive management team within their companies, up from just more than 50 percent in 2012. More than half of those we looked at report directly to the chief executive officer.

- In contrast to 2012, CCOs with past experience in operations, quality, or business process edged out those with division president or general manager positions. For example, Intuit's vice president of customer experience and business excellence formerly held director-level product quality and process excellence positions.

CCOs need to orchestrate organization-wide change.
New CCOs can make big customer experience improvements that lead to profits for their companies. But that means more than tweaking marketing messages, building a new mobile app or making call support agents friendlier. Instead, it involves orchestrating the wide range of employees and partners across the ecosystem that actually delivers value (and the experience) to customers. To get started, these customer experience leaders need to:

- Create end-to-end accountability for customer experience. Customer experience success requires change across all parts of the organization, not just in specific functions like marketing or customer support. Executives in the CCO position are ideally positioned to drive that change. As the new CCO of Peoplefluent put it, "By merging all customer-facing roles from pre- to post-sales into a singular accountable organization, we align the business to deliver a single complete customer solution. In doing so, we are driving all business and product decisions around best customer outcomes."

- Design experiences rather than processes. Customer experience transformation involves changes in the fundamental ways that a company operates and delivers value to customers. The big uptick in CCOs with operations backgrounds signals an awareness of this fact. These leaders need to reframe problems and opportunities from the customer's perspective, not the internal point of view that process improvement often takes. The new CCO at Massachusetts Mutual Life Insurance, formerly a COO, puts it this way: "Many companies lose sight of the experience they're creating for their customers. Processes form organically over time, and few organizations consider the customer experience as a whole, let alone explicitly design, implement, and measure it consistently across the board. That's where we hope to be different."

- Shift culture. 2013 saw an increase in the scope of the CCO role from advisory-type positions to more operationally structured positions. Annie's added all marketing and sales functions to its CCO's line of command, while Nissan put customer quality and its dealer development network under the direct control of its CCO. This operational control makes it easier to drive culture change across the organization. As Nissan America's CCO Leon Dorssers put it: "As research improves and helps us better understand how people make decisions, we have much more opportunity to improve the customer experience with Nissan and Infiniti across the entire consideration, purchase, and ownership timeline. Instilling a customer-centric culture is imperative to optimizing customer experience for all Nissan and Infiniti products and services."

To learn more, check out my latest report on "How Chief Customer Officers Orchestrate Experiences." I've also recently launched a collection of reports to help companies understand the dynamics of the complex ecosystem that underlies the experiences that firms deliver in the "Customer Experience Ecosystem Playbook."

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About the Author: Paul Hagen is a principal analyst at Forrester Research serving Customer Experience professionals. He blogs at http://blogs.forrester.com/paul_hagen

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