How to Pay for a Better Customer Experience

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Customer Engagement
Customer Experience
Although everyone agrees that having a better customer experience should be good for a company, a lot of us worry about how to pay for improving it. Customer service does cost money, so the question is whether the cost of delivering a better experience is worth it or not? Will a better customer experience pay for itself?

Although everyone agrees that having a better customer experience should be good for a company, a lot of us worry about how to pay for improving it. Customer service does cost money, so the question is whether the cost of delivering a better experience is worth it or not? Will a better customer experience pay for itself?At Amazon, the most useful indicator of a customer's satisfaction is considered to be "resolution." The company wants to ensure that all a customer's problems are quickly and easily resolved, so that no friction interferes with any customer's experience. According to one former Amazon executive, the single most important metric they use to gauge their success in their own call centers is what they call the Non-Resolution Rate, or NRR.

While most call centers track metrics like average handle time (AHT) and first-call resolution (FCR), in other words, the metric Amazon uses goes directly to the issue of customer dissatisfaction. It's designed to track any friction in the customer experience that has yet to be eliminated - friction that inevitably generates unhappiness, frustration, or even anger in the customer's mind.

To improve their customer experience, Amazon focuses relentlessly on the problems encountered and not yet completely resolved. They keep those problems visible to the enterprise until they are fixed, and then they try to ensure that similar problems don't arise.

So by seeking out and eliminating all the little sources of friction in the customer experience, you should be able to pay for your customer experience improvement initiative, and you can do it one problem or issue at a time. You don't have to boil the whole ocean at once. It's really very simple - identify the many small, irritating sources of friction in your customer experience, and then work to resolve them, one at a time.

Want an example? Consider how Fidelity's SVP of Customer Experience, Parrish Arturi, approached the problem. Arturi focused his efforts on one small process improvement at a time, and he allowed people to submit small requests for budget to fix these individual problems, without having to do fully fleshed out proposals. As Forrester's Harley Manning and Kerry Bodine put it in their book Outside In, "[b]y requiring appropriately lightweight justifications for these minor requests [Arturi] was able to tackle more projects, faster."

According to Manning and Bodine,
One of these small projects began when a service rep noticed that a large number of people were having trouble logging in to their accounts through an automated phone system. The rep started a thread about the situation on a Fidelity discussion board dedicated to generating ideas for experience improvements. [Arturi's] team, the owners of the board, saw the thread and flagged it for attention, [and]... then worked with the people who manage the phone system to identify the root cause of the login issue and quickly launch a solution.

Although the total cost of that fix was less than twenty thousand dollars, it saves Fidelity $4 million a year by averting calls to customer service. It was just one of over one hundred and sixty projects that came through Fidelity's experience improvement system in 2011. Together those projects accounted for over $24 million in annual savings.

This post is part of the Customer Experience Professionals Association's Blog Carnival "Celebrating Customer Experience." It is part of a broader celebration of Customer Experience Day. Check out posts from other bloggers at http://community.cxpa.org. - See more at: http://community.cxpa.org/blogs/val-moschella/2014/10/07/cx-day-blog-car...

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