What is the weakest link in achieving maximum value from your customer experience (CX) initiatives?
Culture.
If you don’t have organization-wide support for CX, or a corporate strategy that recognizes the value of customer-centricity, chances are you can’t fully benefit from what Experience-Led Growth (XLG) can provide.
According to a recent Forrester survey, alignment around customer value is the foundation to drive consistent growth, profit, and retention. Businesses with high levels of alignment across their customer-facing functions reported 2.4 times higher revenue growth and twice the profitability growth of those with no alignment.
Alignment comes down to strategy and that feeds directly into corporate culture. When the entire organization is aligned on CX and finding benefit in how customers think and feel, XLG becomes part of the fabric of decision-making.
So how does culture impact the customer experience? Organizational culture acts like a gravitational force, able to reinforce and spread either positive or negative ways of working. The maturity of an organization's culture plays an important role in the speed it implements and transitions to Experience-Led Growth.
Chattermill has an XLG maturity assessment to help you benchmark where you’re at and what you can do to improve your CX. We’re breaking down the last pillar of XLG maturity – Culture – to discover how you can maximize your prospects for driving revenue growth in your organization.
Culture: the fourth pillar of XLG
Organizations who are leading the way in the Culture pillar operate in a fundamentally different way to those at lower levels of maturity. They know how XLG can increase their profitability and recognise that the right organisational culture is an essential part of realising this growth.
How XLG maturity is determined
Every organization is starting from a different place. The strengths and weaknesses of one business are often very different from another. The maturity process starts by assessing an organization against each of the core components required for XLG. This assessment provides a clear, objective understanding of the business's current reality. By contrasting an organization's current reality with what best in class looks like, Chattermill then determines the actions required to move your business up the maturity ladder. Some of the actions will deliver quick wins, while others may require time to become fully embedded and produce results. Regardless, each action is assigned a priority according to your business goals and the impact the action has on profitability. This ensures you have a clear road map to deliver the most benefit to your XLG in the short term and over time.
The four stages of XLG maturity:
- Gut feel – making decisions without an understanding of the customer’s perspective is the cultural norm.
- Developing – the customer’s perspective may be included in some decision-making but this approach is not the norm across the organization.
- Influencing – it is culturally expected that the customer's point of view will be factored into decision-making. This is reflected in how teams are measured and incentivized.
- Leading – the customer is at the heart of decision-making, a customer-centric approach that is integral to the culture of the organization. Incentives and KPIs are built on this expectation.
Moving from gut feel to leading the way on XLG maturity
As the previous pillars - taking action and data and insights - understanding what your customers think and feel about your business products and services, acting on these insights, and then measuring the impact is fundamental to achieving sustainable, profitable growth.
XLG maturity requires deliberate action to achieve and maintain the necessary capabilities to continually improve your CX. Maturity only occurs when those capabilities are implemented. In other words, XLG is not about what you can do, but what you do every single day to make your business customer-centric.
This is why culture, including what behaviours are motivated through KPIs targets and incentives, is such an important component of XLG.
What’s involved in the Culture pillar of XLG maturity?
- Organizational buy-in – deep insight into what customers think and feel is regarded as essential to decision-making and this is reflected in ways of working across teams.
- Alignment and measurement – CX is baked into company objectives and KPIs as success metrics that are tracked and measured.
- Ownership and resource allocation – the overall customer experience is part of the corporate strategy, and budget is dedicated to continually enhance and develop CX Intelligence.
What it takes to go from the Gut Feel to the Developing stage for the Culture pillar
Organizations operating at the Gut Feel level do not believe CX initiatives add meaningful value. CX is not considered part of company strategy. No CX objectives or KPIs are assigned. Little or no resource is allocated to developing CX intelligence or initiatives.
To move to the Developing stage, organizations need to recognize the need to move to a more customer-centric model of doing business. How to achieve this transition is one of the major challenges for Gut Feel organizations.
Transitioning from the Developing to the Influencing stage for the Culture pillar
Developing organizations strive to move from an inconsistent or limited view of the customer experience to a comprehensive view. CX metrics begin to appear as KPIs but are isolated to specific individuals or teams. No meaningful incentives are in place, which means developing CX Intelligence is often a low priority. There is no ownership to have an organization-wide view of what customers think and feel.
Organizations at the Influencing stage have taken the fundamental step towards putting the customer at the heart of decision-making. They have a consistent view of customer feedback data throughout the customer journey. Repeatable processes are in place to deliver insights about what customers think and feel in multiple areas of the organization. Culturally, it is recognized that CX Intelligence has a significant impact on success and acting on customer insights is a high priority. Quantified results reinforce the process and encourage further optimization.
CX metrics are part of all teams’ KPIs. CX Intelligence has resources and a budget is allocated to it.
Achieving the Leading stage for the Culture pillar of XLG maturity
At the Leading stage, CX Intelligence is at the core of organizational strategy and approach. There is no question that delivering a better customer experience is the way they will dominate their competition and their market. Company decision-making is based on the experience-led process and this ethos is reflected in how teams are measured and incentivized across the organization. Budget and resources are allocated to the continual improvement of the experience-led process. This approach allows them to confidently and consistently make the right investments needed to stay ahead. In the Leading phase, the company is focused on innovation and optimization, rather than fixing what’s not working.
Customer understanding is the key to XLG maturity
Having a desire to know what your customers think and feel – and being prepared to act on those insights – is central to achieving XLG maturity across all four pillars. A high level of cultural maturity can be challenging to achieve because it requires organizational recognition that a customer focus is the most profitable way to conduct business. However, teams and individuals can successfully drive this evolution. Whether this change takes place from the top down or from the bottom up, the good news is once the value of CX Intelligence is recognized and supported across the organization as a way to drive growth, it’s incredibly hard to unseat an XLG business strategy.
