We work in environments where people and organizations are motivated to seize today’s pennies forgoing tomorrow’s dollars. This is a contributing factor as to why so few companies are customer-centric. Becoming customer-centric not only requires the Three Competencies – Identity, Intelligence and Consistency – but the patience to allow the competencies enough time to become culturally ingrained and to show results. In a “right now” world, becoming customer-centric is a long-term play.
So how does customer experience (CX) avoid becoming the next new thing that eventually fades into history? There are few factors in large organizations that win out over the temptation of seizing short-term gains to make the number and get a juicy bonus. Of course those in Accounting or Finance will always be able to quantify the upside of the short-term gain. What do you do when the organization is behind and looks like it is going to miss its revenue target and Finance comes to the table proposing going from 2-day to 5-day shipping, saving $19 million dollars this year?
Bring out the big guns
To fight this fight, you need big guns. Your big guns are Values, the correlation of the macro metric, (i.e. Net Promoter® Score, American Customer Satisfaction Index, etc.), to a key financial metric such as top line revenue or Lifetime Customer Value. Values provide the soft defense while financial correlations provide the hard.
Values should be honored as if law. You can’t go against your Values. This is a huge reason I push organizations to clearly define them. First, Values help in the delivery of consistent touchpoints and establishing the desired brand Identity. Second, Values are a parameter for decision-making. The very essence of Values is that they are foundational for all that the organization does.
Values represent a solid yet soft defense. Of course, Values can be a grey area where one can often argue both sides – this is why you also need hard metrics.
A hard metric
Lifetime Customer Value (LCV) is a hard metric. Understanding its components and drivers positions you to make a hard argument. Finance will be able to quantify the $19 million dollars savings to help “close the gap” or “make the number.” You can use LCV or my one point movement in NPS formula to quantify the other side of the story - the potential negative impact on customer value if the shipping proposal is accepted.
Without Values and/or financial correlations, what is your argument not to go to 5-day shipping and save $19 million dollars? Values and financial correlations will help an organization maintain its customer-centric compass when there are voices singing to seize the short-term financial benefits that will ultimately harm customers and their value to your organization.
Note: There are also a number of good articles and books on the subject of Lifetime Customer Value.
Remember, to your customers, you are your touchpoints.
This post an excerpt from my book, TOUCHPOiNT POWER! Get & Keep More Customers, Touchpoint by Touchpoint (William Henry Publishing, 2013), an Amazon international top 10 customer service best-seller. For information and to order, visit TouchpointPower.com or view the TOUCHPOiNT POWER! listing on Amazon.
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