New Buzz Phrase Drives CRM and App Development

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Everybody has an example of a bad customer experience.

The cable TV company can never get anything fixed when they say it will be fixed. The car dealer has no idea what cars and parts are available at other retailers in the area. The PC manufacturer doesn’t offer competent support on the help desk and doesn’t offer any alternatives.

Ironically, just about every company says that improving customer experience is a high priority. And that improvement campaign is about to involve you, IT professional.

Better Integration

It turns out that one of the myriad ways to improve customer service is to better integrate the silos of information and applications lurking in the back offices of most companies. Two new surveys by Bloomberg Businessweek Research Services found that better and deeper links among the financial, operational and service modules within most companies can go a long way toward improving the customer experience.

Note that this is not just a customer relationship management (CRM) issue. This involves almost all enterprise applications that directly or indirectly touch customers. Also note that better integration is equally valid for companies in the consumer or business-to-business environments — no one is immune from the problem.

Eight of 10 companies responding to the November 2010 poll by BBRS said that providing a better customer experience was one of their top strategic objectives for 2011. And even a higher percentage of telecom, high tech, and healthcare companies indicated that improving customer experience was a high priority. It will come as no surprise to airline passengers that only seven of 10 travel industry executives said that improving customer experience was a high priority.

Note that this was a global survey, with more than 1,000 respondents from a wide range of industries and from companies with at least $500 million in revenues.
Another telling juxtaposition: while most companies claim that improving customer experience is a high priority, they also acknowledge that their current customer experience is decidedly mediocre.

The self-rating of their company’s customer experience is 3.62 on a scale of 1 to 5, with 5 indicating a great experience. Give the telecom companies credit for self-awareness: they gave themselves the lowest customer experience rating: 2.94 out of 5.

In addition to the modest grades for the customer experience they provide, respondents to another BBRS survey provided candid insights into the biggest obstacles they face in improving the experience endured by their customers. Top on their hit list is the organizational and process silos, followed by a lack of coordination across channels and the large number if disconnected technologies, as you can see in the following table.

customer experience

Source: Bloomberg Businessweek Research Services, February 2011 report, How to Achieve a Great – and Profitable – Customer Experience

Note that the relatively similar percentages for the top three obstacles indicate that all three are essentially equal in stature as obstacles. This survey conducted in December 2010 had more than 300 respondents from North American companies with at least $200 million in revenues.
Of course, when the CEO or the chief marketing officer or even the CFO comes to your CIO and says, “Fix this,” there is no magic wand to wave or Easy button to push.

Better integration of applications has been a top priority of senior management for decades and remains a challenge.
While the Y2K furor led to the consolidation of some enterprise applications and the replacement of some internally developed apps with commercial off the shelf packages, most large companies suffer from multiple and incompatible systems tracking revenues, products and customers. The lack of integration not only prevents most companies from improving their customer experience, it also wastes money.

And that argument will help you get the funds to fix the problems. Trashing the oldest and least flexible legacy systems and replacing them with modules from one of your existing enterprise applications providers is one step, and the most common: The large BBRS survey found that almost four out of 10 respondents would be continuing the standardization programs they had already launched to improve integration, as they consolidate applications software vendors.

This table shows the 2011 integration plans of more than 1,000 respondents to the BBRS survey late last year, when they could select more than one approach:

Customer experience survey

Source: Bloomberg Businessweek Research Services, November 2010, The Right Foundation for Growing Global

As you can see from the table, 89% of the respondents plan at least one integration initiative. And most have at least two different strategies in place, typically a combination of consolidation of older apps and SOA or cloud for new efforts.

These integration programs to improve customer experience will be a multi-year journey, so get comfortable and enjoy the ride.