Tak­ing cen­ter stage

The Smart Manager - - Contents -

Gau­tam Bo­rah, au­thor of Monetis­ing In­no­va­tion, lists the top ten trends to emerge in cus­tomer ex­pe­ri­ence man­age­ment.

In an ar­ti­cle in th­ese columns, Chuck Wall, founder and chief ex­ec­u­tive of­fi­cer of Mar­ket­power Group, spoke about how too many com­pa­nies are re­ly­ing ex­clu­sively on data to ex­plain what cus­tomers re­ally need. Iron­i­cally, many have too much data to process and make ac­tion­able. But the quan­ti­ta­tive is only one piece of the puz­zle. The qual­ity of cus­tomer ex­pe­ri­ence also mat­ters. Un­der­stand­ing cus­tomer 2.0 and de­liv­er­ing su­pe­rior ex­pe­ri­ence holds the key.

What is it stretch­ing to the hori­zon? Have you read Ori­gin, the lat­est mas­ter­piece from Dan Brown? I felt the emerg­ing so­cio-busi­ness en­vi­ron­ment of to­day or the one we are head­ing to prob­a­bly can be ap­pro­pri­ately para­phrased by this quote from Ori­gin. “Hu­man be­ings are evolv­ing into some­thing

1 dif­fer­ent. We are be­com­ing hy­brid species—a fusion of bi­ol­ogy and tech­nol­ogy. The same tool that live out­side our bod­ies—smart­phones, hear­ing aids, read­ing glasses, most phar­ma­ceu­ti­cals—in fifty years will be in­cor­po­rated in our bod­ies to such an ex­tent that we will no longer be able to con­sider our­selves Homo Sapi­ens.”

It was only in 1983, Com­paq Por­ta­ble, con­sid­ered as the first per­sonal com­puter clone, was re­leased. World Wide Web started tak­ing shape around 1989 when CERN opened the first ex­ter­nal TCP/IP con­nec­tions. Google reg­is­tered the do­main in 1997 and the first true smart­phone, iPhone, was launched in 2007.

How­ever, in the last two-and-half decades, tech­nol­ogy

has per­me­ated like never be­fore rad­i­cally trans­form­ing ev­ery sphere of hu­man life. Look at the fol­low­ing statis­tics:

■ In a pop­u­la­tion of 7.4 bil­lion, there are 4.9 bil­lion unique mo­bile users, 3.8 bil­lion In­ter­net users, and 2.8 bil­lion so­cial me­dia users

■ In an In­ter­net minute, 16 mil­lion text mes­sages are ex­changed on What­sApp, 3.5 mil­lion search queries are run on Google, 4.1 mil­lion videos are viewed in You Tube.

And if it sounds mind-bog­gling, that is about just only a frac­tion of what hap­pens in the dig­i­tal world. Putting all in per­spec­tive, the cur­rent busi­ness uni­verse can be con­tex­tu­al­ized by a few phe­nom­ena as de­lin­eated be­low:

■ speed of dig­i­tal evo­lu­tion – Moore’s law3: The dig­i­tal revo­lu­tion in terms of ‘pro­cess­ing speed’ and ‘de­gree of con­nect­ed­ness’ are two vi­tal fac­tors that sig­nif­i­cantly in­flu­ence the com­pet­i­tive­ness of a firm. As per Moore’s law, dig­i­tal pro­ces­sor speeds, or over­all pro­cess­ing power for com­put­ers will dou­ble ev­ery two years.

■ tech­nol­ogy adop­tion time4: tech­nol­ogy adop­tion time has re­duced dras­ti­cally in case of dig­i­tal, or more in case of in­ter­net-based prod­ucts. For in­stance, for reach­ing a dif­fu­sion of 25% (per cent of own­er­ship), ra­dios took more than 25 years. How­ever, in case of in­ter­net, it took less than ten years to reach the same fig­ure.

dig­i­tal ex­panse and con­nect­ed­ness

Across do­mains, there is a grad­ual shift to­wards a dig­i­tal space di­min­ish­ing the phys­i­cal bor­ders. Un­like a decade be­fore, there is a mar­ket siege by com­pa­nies based on tech­nol­ogy con­ver­gence. Quot­ing from ‘Th­ese are the world’s most dig­i­tally ad­vanced coun­tries’, there are few salient fea­tures of to­day’s dig­i­tal land­scape. Few rel­e­vant in this con­text are:

■ dig­i­tal tech­nol­ogy is wide­spread and spread­ing fast: Cross-bor­der flows of dig­i­tally trans­mit­ted data ac­counted for one third of in­crease of global GDP in 2014 and it is ris­ing.

■ dig­i­tal player wield out­size mar­ket power : In 2017, Ap­ple, Al­pha­bet, Mi­crosoft, Ama­zon and Face­book were the five most valu­able com­pa­nies leav­ing be­hind their bricks-and-mor­tar brethren.

■ dig­i­tal tech­nolo­gies are poised to change the fu­ture of work : This is what is of­ten be­ing ad­duced as ‘Se­cond Ma­chine Age’ when au­to­ma­tion, big data and AI-en­abled by ap­pli­ca­tion of dig­i­tal tech­nolo­gies could af­fect 50% of the world econ­omy.

While re­search to ad­vance the dig­i­tal age fur­ther will be in the core tech­nol­ogy do­mains, it is crit­i­cal for the busi­ness to rec­og­nize and work on the emerg­ing trends in ev­ery other area like cus­tomer ex­pe­ri­ence man­age­ment, to stay com­pet­i­tive.

Here, I would like to quote from Shel­ley, which ex­em­pli­fies the cla­mant need round the cor­ner:


The trum­pet of a prophecy! O Wind,

If Win­ter comes, can Spring be far be­hind?

As we would see in the next sec­tion, cus­tomer ex­pe­ri­ence man­age­ment will be a game changer for a busi­ness rather than be­ing on the pe­riph­ery as in the past. Fol­low­ing is an out­line of what one can ex­pect in cus­tomer ex­pe­ri­ence man­age­ment in the com­ing few years. The out­put pre­sented com­bines in­te­gra­tion of cur­rent re­search along with a prag­matic field ex­pe­ri­ence. The trends are in­dus­try ag­nos­tic.

01 an all-pow­er­ful and choosy cus­tomer will emerge The ba­sic in­gre­di­ents of cus­tomer re­quire­ment can be stated as ‘right’ (prod­uct), ‘now’ (time to de­liver/re­cover) and ‘free’ (cost). If not ex­po­nen­tially, dig­i­tal tech­nolo­gies will push the bound­aries of cus­tomer re­quire­ments faster

than ever. Con­nect­ed­ness will make the cus­tomer choosy and he will set­tle for not less than what he wants.

02 cus­tomiza­tion / in­di­vid­u­al­iza­tion of prod­ucts will be the key

Once the cus­tomers be­come choosy, firms will have to shift fo­cus to prod­uct in­di­vid­u­al­iza­tion/cus­tomiza­tion. This will be sim­i­lar to what I re­fer as ‘pa­tient model’ where each pa­tient in a med­i­cal cen­ter re­quires dif­fer­ent types of med­i­cal care. This cus­tomiza­tion has been re­ferred to as N=1 by C K Pra­ha­lad, when a firm will be ex­acted to tailor the prod­uct as per in­di­vid­ual pref­er­ence.

03 com­pa­nies will have to fo­cus on prob­lem-free prod­uct (sim­pli­fi­ca­tion)

How many times have you called up What­sApp call cen­ter (do they have one in fact)? What­sApp is one of the best ex­am­ples of prob­lem-free prod­uct when a cus­tomer never has to reach out to the provider with a com­plaint. Many have writ­ten about strong cor­re­la­tion be­tween a prod­uct and a sat­is­fied cus­tomer, and loy­alty. Due to vast choices

avail­able at the fin­ger­tips and cus­tomiza­tion, cus­tomers will tend to se­lect prob­lem-free prod­ucts more and more. With more de­mand­ing cus­tomers, com­pa­nies will have to in­vest in cre­at­ing prod­ucts free of de­fect. This will ne­ces­si­tate more rigor in build­ing cus­tomer re­quire­ments from the de­sign stage it­self.

04 not prod­uct, cus­tomer ser­vice will be a de­ter­mi­nant of brand choice

More and more cus­tomers will de­cide on a par­tic­u­lar brand de­pend­ing on the qual­ity of the ser­vice pro­vided. Ac­cord­ing to Amer­i­can Ex­press Global Cus­tomer Ser­vice Barom­e­ter 201710, there is an emerg­ing trend of im­por­tance of cus­tomer ser­vice while de­cid­ing to buy a prod­uct. As per the sur­vey, the top three coun­tries where cus­tomers had not bought a prod­uct due to bad cus­tomer ser­vice are In­dia (66%), Sin­ga­pore (66%), and Mex­ico (63%). Sim­i­larly, there is a trend of cus­tomers will­ing to spend more due to good cus­tomer ser­vice. Top three coun­tries in this cat­e­gory are In­dia (21%), US (17%) and Sin­ga­pore (16%).

05 there will be a strong need for cre­at­ing real-time ex­pe­ri­ence

New con­sumer jour­ney is shift­ing from ‘ses­sions’ to ‘spurts’ which Google has men­tioned as ‘mi­cro­mo­ments’. This is when con­sumers turn to a de­vice and make a de­ci­sion. 65% of them agree that while do­ing a search in their smart­phone, they look for the most rel­e­vant in­for­ma­tion re­gard­less of the com­pany pro­vid­ing in­for­ma­tion. This will emerge as the new bat­tle ground for the brands to ‘be there’, ‘be use­ful’, and ‘be quick’. And,

wins at the mi­cro-mo­ments will be de­pen­dent on cre­ation of rel­e­vant and per­son­al­ized real time ex­pe­ri­ence at the right mo­ment.

06 big data and strong an­a­lyt­ics will be lever­aged Real time an­a­lyt­ics will re­quire pro­cess­ing of huge in­flux of data. An­a­lyt­ics ori­en­ta­tion will shift from ‘hor­i­zon­tal touch­point’ based to ‘cus­tomer life­cy­cle’ based. Apart from the three big ‘V’s—vol­ume, va­ri­ety, ve­loc­ity—big data will play a crit­i­cal role to cre­ate ‘value’ at the rel­e­vant mo­ment. It will be used in four stages—col­lec­tion of data from the rel­e­vant touch­points and in­ter­ac­tions, pro­cess­ing and an­a­lyz­ing it in con­junc­tion with past data, ex­trac­tion of ac­tion­able in­sights, and mea­sur­ing im­pact.

07 ar­ti­fi­cial in­tel­li­gence is here to stay, bring­ing in ac­cu­racy and speed

If you are fas­ci­nated by the buzz around chat­bots, it is just the tip of the ice­berg. AI is on the way to trans­form the fun­da­men­tal rules that tra­di­tion­ally used to de­fine cus­tomer ex­pe­ri­ence. It is im­por­tant to take cog­nizance of the fact that AI is not a sin­gle tech­nol­ogy, rather it refers to

An­a­lyt­ics ori­en­ta­tion will shift from ‘ hor­i­zon­tal-touch­point’ based to ‘ cus­tomer - life­cy­cle’ based.

dis­crete tech­nolo­gies or plat­forms, which in­di­vid­u­ally or in com­bi­na­tion can add in­tel­li­gence to ap­pli­ca­tions. Adapted from Or­a­cle’s In­ter­net of Things Value Frame­work, a For­rester re­port men­tions the fol­low­ing five ways how cus­tomer ex­pe­ri­ence will be rad­i­cally fu­eled by use of AI— in­creased ef­fi­ciency, re­duced fric­tion, en­hanced cus­tomer em­pow­er­ment, proac­tive ac­tion, and pre­emp­tive ser­vice.

87% of smart­phone users keep their phones by their side any time and 91% of­ten turn to their phones for ideas even in the mid­dle of a task.

08 there will be a grad­ual shift to­wards on­line chan­nels

If one can turn the clock back by a few years, you will see cus­tomer sup­port be­ing equated with con­tact cen­ters. How­ever, there is a grad­ual shift to­wards cus­tomers re­sort­ing to on­line chan­nels for res­o­lu­tion and sup­port and the num­bers are sig­nif­i­cant. For the coun­tries which top the list, the per­cent­age of cus­tomers who use on­line chan­nels for prob­lem res­o­lu­tion are: In­dia 30%, Hong Kong 26 %, Italy 26 % and Mex­ico 25 %. One off­shoot

of this would be re­duc­tion of de­pen­dency on call cen­ters. They will cater only to the core ser­vice needs where hu­man in­ter­ven­tion is in­evitable.

09 cus­tomers will de­pend more and more on mo­bile phone for re­quired ser­vice

As much as 87% of smart­phone users keep their phones by their side any time and 91% of­ten turn to their phones for ideas even in the mid­dle of a task. Another crit­i­cal

in­di­ca­tor is con­ver­sion rates from mo­bile, which shot up by 29% in the last year. This tiny gad­get, un­no­ticed, is

grad­u­ally be­com­ing an in­te­gral part of our lives and more and more peo­ple will be us­ing it for mak­ing an in­formed de­ci­sion in­clud­ing when look­ing for a ser­vice.

10 com­pa­nies will shift to re­la­tion­ship from res­o­lu­tion

While con­ver­sion from mo­biles has in­creased by 29%, the time spent per ses­sion by con­sumers has re­duced by 18%. At the same time, 65% of the con­sumers agree that while do­ing a search on their smart­phone, they look for the most rel­e­vant in­for­ma­tion re­gard­less of the com­pany pro­vid­ing in­for­ma­tion. This in­sin­u­ates a tran­sient na­ture

of re­la­tion­ship with cus­tomers fo­cus­ing on ‘what’ rather than ‘who’. This will en­tail busi­ness firms to in­vest in strength­en­ing the re­la­tion­ship rather than be­ing a provider of res­o­lu­tion. This is where pre­dic­tive mod­el­ling will play a part as ba­sis of suc­cess, lev­er­ag­ing AI and an­a­lyt­ics.


The im­per­a­tive will be to stay rel­e­vant ‘at the mo­ment’, and com­pa­nies that would act ahead of the curve will sur­vive. This quote which is at­trib­uted to Dar­win is apt here, “It is not the most in­tel­lec­tual of the species that sur­vives; it is not the strong­est that sur­vives; but the species that sur­vives is the one that is able best to adapt and ad­just to the chang­ing en­vi­ron­ment in which it finds it­self.” ■ Fol­low the au­thor at @gau­tamkb­o­rah (Dis­claimer: The views ex­pressed in the ar­ti­cle is of the au­thor’s and do not re­flect the views of any­one else in­clud­ing the or­ga­ni­za­tion he is work­ing for) 01 Brown Dan (2017) : Ori­gin :Ban­tam Press, Lon­don, p 411 02 http://www.busi­nessin­sider.com/every­thing-that-hap­pens-in-one-minute-on­the-in­ter­net-2017-9?IR=T 03, 04 Bo­rah Gau­tam (2015): Monetis­ing In­no­va­tion: Blooms­bury, New Delhi p. 74 05 Chaturvedi Ravi, Bhalla Ajay, Chakra­vorti Bhaskar (2017): Th­ese are the world’s most dig­i­tally ad­vanced coun­tries: World Eco­nomic Fo­rum 06 Shel­ley Percy Bysshe, Ode to the Wind 07 Pra­ha­lad CK, Kr­ishna nM S (2008): New Age of In­no­va­tion, Driv­ing Cocre­ated Value Through Global Net­works, Mc-Graw Hill 08 Krivobokova O V (2009: eval­u­at­ing Cus­tomer Sat­is­fac­tion as an as­pect of Qual­ity Man­age­ment. Pro­ceed­ings of World Academy of Sci­ence. En­gi­neer­ing and Tech­nol­ogy 09,13 Ch aiKH,DingY,XingY (2009): Qual­ity and Cus­tomer Sat­is­fac­tion Spillovers in the Mo­bile Phone In­dus­try 10,14,15, 16 Amer­i­can Ex­press Global Cus­tomer Barom­e­ter, 2017 11 Adams Laura, Burkholder Eliz­a­beth, Hamil­ton Katie : Mi­cro-Mo­ments – Your Guide to Win­ning the shift to Mo­bile :Google 12 Legget Kate (2017) : How AI will Trans­form Cus­tomer Ser­vice : For­rester 17 https://quotein­ves­ti­ga­tor.com/2014/05/04/adapt/

Across do­mains, there is a grad­ual shift to­wards a dig­i­tal space di­min­ish­ing the phys­i­cal bor­ders.


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