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www.beyondphilosophy.com
ROI in the Customer Experience Colin ShawBest Selling CE Author CEO, Beyond Philosophy
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The Beyond Philosophy Perspective
Customer Experience is all we do!
Thought leadership is our differentiator
Offices in London, Atlanta with Partners in
Europe & AsiaFocus on the emotional side of the Customer Experience
Links with Academia
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We are Proud to Have Helped Some Great Organizations…
Beyond Philosophy © All rights reserved. 2001-2011
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Why is this such a challenge….
It’s a religion…
Hearts and Minds, and people’s understanding of the Customer Experience are the root cause of people’s lack of acceptance…
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When in Rome…
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The ways of getting to ROI…
General models
Company specific research
Other company case studies
Cost savings
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Source: Watermark Consulting 2010.
Beyond Philosophy © All rights reserved. 2001-2011
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4,700 consumer surveys
Forrester analysis shows that good customer experience correlates to:
Consumers’ willingness to repurchase Reluctance to switchLikelihood to recommend firms
Correlation between customer experience and loyalty increased in every industry over the last year.
Source: Forrester. February 18th 2009.
Correlation between customer experiences and loyalty of 100 US companies
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Case Study:Enterprise with 2 million customersRevenue = $200,000,000 per year Average Revenue per customer = $100 per year
At risk — 55%Decline in wallet
share
Defect — 45%
Poor experience22%
Positiveexperience
78%
Complain2%
Do notcomplain
98%
At risk — 34%Issue not resolved
Defect — 28%
Resolved — 38%440,000customers
431,200customers
2,464 customers$246,400
194,040 customers$19,404,000
2,992 customers$299,200
237,160 customers$23,716,000
8,800customers
Sources: Cherry Tree Research, Bain & Co., McKinsey, Harvard Business Review and Gartner
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The ways of getting to ROI…
General models
Company specific research
Other company case studies
Cost savings
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Middle East Telecommunications Company
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Product quality versusemotional engagement
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Priority Order of the Attributes (Combined desirability and current value) – Premium Consumers
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Top
Ten
Relative Magnitude0 +-
Desired by Customer Effect on Value
Beyond Philosophy © All rights reserved. 2001-2011
www.beyondphilosophy.com 15Beyond Philosophy © All rights reserved. 2001-2011
The ways of getting to ROI…
General models
Company specific research
Other company case studies
Cost savings
beyondphilosophy.com 16Beyond Philosophy © All rights reserved. 2001-2011
beyondphilosophy.com 17Beyond Philosophy © All rights reserved. 2001-2011
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Improving Customer Satisfaction: Memorial Herman Hospital System (MHHS)
The Context
The Change
The Benefit
•MHHS is a system of 11+ hospitals (3,500 beds) with 20,000 employees•Customer Satisfaction drives a large percentage of government sponsored reimbursement for
hospitals in the USA•This reimbursement is crucial for hospitals to recoup the cost of care to indigent population s for
which they are required to provide service for. •Roughly, every percentage point increase in PSAT above 75% represents $1.4m •MHHS provides more care to indigents than any of its competitors . •A typical Hospital had Patient Satisfaction scores of about 81%.
•Beyond Philosophy redesigned the MHHS experience via Moment Mapping and Emotional Signature and practitioner training
•The end result was a revamp of MHHS’ inpatient and outpatient Caner, Heart & Lung and Emergency Room experiences .
•On average, average Patient satisfaction scores in the hospitals increased by:•91% in poor performing hospitals•12% in great performing hospitals•This translates to an additional $10m revenue
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What’s Next When You’re on Top of Your Game: Overbury
• xxx• xxx
• xxx• xxx
The Benefit
The Change
• As a result the “Customer Experience Vision” initiative was launched based on 3 pillars:• Product – Make it• Process – Make it simple • People – Make it engaging
The Context
• Overbury started their “Perfect delivery” Customer Experience initiative aiming to deliver their projects on time, snag free and delight clients
• Revenues increased by 40% as “perfect delivery” was increased from 24% to 60% in the first year of the project
• In 7 years their revenue increase by 170% and they moved from 4th to 1st in market share
• The fast growth brought some problems:• competition began to copy “perfect delivery”
and was catching up• the perfect delivery of projects got stalled
• The company was on top of its game but was facing the possibility of a downward trend
• To keep up the upward trend they needed to take their customer experience to the next level
•Annual revenue increased by 15%• Increase “perfect Delivery” from 91% to 96%•The Net Promoter Score has increased significantly to reach 70% (one of the highest not only in the sector but also worldwide)
• Beyond Philosophy addressed the formulation of the new Customer Experience strategy by conducting:• Internal research to understand the current
thinking• Quantitative research and analysis to get
customer insights and generate hypothesis• Data analytics to test the hypothesis with
customers and generate statements
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Differentiating in a Commoditied Market:Comet
• xxx• xxx
The Benefit
The Change
The Context
• Commoditised market with no differentiation: customer’s perception was that all carry the same range of products, at the same price and same service
• Lack of trust – customers felt a duty of due diligence to shop around
• Poor service – Technicians didn’t engage with customers; Salespersons were paid on commission; they would either pounce on customers, lurk over their shoulder or chat at the till
• Increased “like for like” sales by 3%•Reduced customer complaints by 20%•Levels of trust increased by 10%
• Beyond Philosophy designed a differentiation strategy based on Customer Experience. With that purpose in mind were conducted:• Philosopher’s day workshop as training for
the senior management to get people on top on the right track for the new strategy
• Best Practice Study Tour to get inspiration form enlightened organizations
• Customer Mirrors to identify break points in the experience
• Moment Mapping to design the new experience
• Over the project the client understood that for the customers getting their new TV or gadget was a very emotional experience as well as letting someone into their house
• Some of the game changing ideas that came from this engagement were around creating a “Father Christmas” moment when technicians went to deliver and install the product..
• The store experience was also addressed in 41 pilot stores.
• The initial feedback was excellent and the programmes was rolled out in 200+ stores
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The ways of getting to ROI…
General models
Company research specific
Other company case studies
Cost savings
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When Product Innovation is Not an Option: Yorkshire Water
The Context
• Bottom of the OFWAT (the regulator) Customer Service League Table (being on top of it means you can charge premiums)
• Low customer perceptions (after 1995 water shortage fiasco and managers bonuses scandal)
• Increasing customer expectations• Facing the threat of competition• Toughest pricing review since privatisation in
1989
The Change
• One of the key recommendations was to remove measures such as “call duration” and “calls waiting”, so agents can focus on problem resolution and develop a caring attitude• To close an issue to customer’s
satisfaction on the first call costs £2-8 compared with £60-70 to send an engineer in a van
• Beyond Philosophy facilitated the development of a customer experience via • Workshops with the senior leader to define a
new Customer Experience Vision and Strategy• Training the call centre and field work staff on
how to implement the new initiatives
The Benefit
• £8.5m of cost savings as a direct result of Customer Experience improvements such as:• 40% reduction in written complaints • 20% reduction in repeat calls• Calls closed on first contact > 70% • 50% reduction of unnecessary field jobs• Appointments within 2hrs - 98%
• Improved overall Customer Satisfaction from 53%-91%
• Ranked 1st in OFWAT Customer Service League table (currently is second)
• “Yorkshire Water has turned itself from one of the most ridiculed companies of the late 1990’s to one of the most respected” - Financial Times, December 2002
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Improving the CE can also lead to lower costs:Case Study 1: Major UK Call Centre Cost Issue
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Cost Issue: Customer callbacks driving costs skyward, CSAT is good
Customer calls to request time sensitive document
Agent thus responds “You should have it within 3-4 days”.
Agents wanted to be truthful.
75 % of customers call back within 3 days to check on status
Thus, company policy and procedure stated “3-4 days”
Previous (rational) research showed customer concerned with “3 days”
Qualitative Research suggested that customers were really concerned
with a definitive answer, not “5 days”
Result: Call backs drop dramatically; to 3% from 75% within weeks
However, agents knew from customers that document often NOT
received within 3-4 days
Actions• Agents trained on what customers really wanted
• Script guidelines changed to “You will have it within 7 days”
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Summary…
Four methods for producing ROI
Remember that this is about Hearts and Minds
When in Rome….
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Questions?
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London Office: 0207-917-1717Atlanta Office: 1-678-638-6162
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