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CX Trends Forecast Disrupter No. 2: Voice of Customer Analytics

Posted by Andrew Kokes

Earlier this year, HGS released a white paper on this year’s 10 customer experience disrupters—those that are sure to alter the CX landscape this year. Over the next few months, we’ll dedicate a blog to each of these CX game changers. Here we dissect Disrupter No. 2, Voice of Customer Analytics.

blog disrupter 2Many organizations are struggling to understand how they can make analytics actionable, because they lack the in-house analytics subject matter expertise, or don’t have the bandwidth to address issues with insights because of competing priorities.  According to an IBM/MIT research study, 38% of businesses lack understanding of how to use analytics to improve the business, 34% of businesses lack bandwidth to leverage analytics due to competing priorities and 28% lack skills internally.

Only 56% of senior business leaders report a clear understanding of customers' tastes and needs, according to a recent report from The Economist Intelligence Unit and SAS.  The report, which was based on a survey of 389 global marketing and non marketing executives conducted last year, also highlights a disconnect among leaders regarding whose responsibility it is to make understanding and interacting with the customer their top priority.

Nearly one-quarter of chief marketing officers (CMOs) surveyed want a chief customer officer to take responsibility for being the voice of the customer, whereas another quarter see the task as their own. Currently, the CMO is considered the voice of the customer at just 18% of organizations, trailing the head of sales (31%). A recent HGS webinar highlighted the fact that listening to the voice of the customer is no longer an option— it’s a necessity for companies that want to get ahead and stay there.

As part of the webinar hosted by Katrina Menzigian, Vice President Research Relations at Everest Group and Parikshit Kalra (PK), SVPImage removed. Solutions and Capabilities at HGS, we conducted a poll that asked “What challenges are you experiencing in implementing analytics?”, the majority of our attendees, >90%, stating either “an immature internal data environment,” or citing a shortage of analytics skills.

To help figure out how to make analytics actionable, Katrina and PK addressed some other insightful questions.

  1. Analytics requires specialized technological capabilities. In your experience, are service providers building out on their own (through proprietary applications) or using commercially available software?
  2. How does the maturity of customer analytics adoption vary by industry?
  3. Our organization is struggling to identify first steps in building our analytics program. Any advice?

This is practical insight that should be shared to help companies get started optimizing the CX through better adoption of analytics and insights.


Webinar - Framework for Actionable Customer AnalyticsQ1: Analytics requires specialized technological capabilities. In your experience, are service providers building out on their own (through proprietary applications) or using commercially available software?

Katrina A: It’s a little bit of both. Some providers have strength and background in analytics, maybe as part of the organizational skill set in building and designing and applying those to their analytics challenges. Others are looking for best-in-breed analytics capabilities and are working those into solutions they present to clients. But, the question buyers need to ask is how does the service provider perceive the challenges and how do they bring the tools to those challenges? Is the service provider creating analytics tool sets and platforms intending to tackle certain kinds of challenges in customer care? The provider may bring together a combination of proprietary and off-the-shelf technology they integrate to create best-in-breed practices based on their perception of how to do this most effectively and this becomes their own brand of how to use technology to adjust analytics.

PK A: This is where a lot of organizations get hung up. Many first invest in a tool and then check its use. I think it’s very important to see if the tool we’re investing in is for one-time use or something that can be used on an ongoing basis. Some of the tools I shared are not tools that have to be built by you, because there is a lot of really good off-the-shelf technology built by companies that may not specialize in extracting data but specialize in building tools. You need to have the right skills to use the tools beyond just clicking a button or purchasing a license — this is what a lot of vendors are moving toward.

Q2: How does the maturity of customer analytics adoption vary by industry?
Katrina A: The issue isn’t much about maturity. It’s more about the application. There are different kinds of analytics challenges faced by different industries. One challenge everybody faces is channel integration related to analytics or social media analytics. For example, the analytics that comes from regulated interactions in the healthcare industry are subject to stringent regulations that create the requirement for a certain kind of data. The question becomes, how do you use this kind of data?
In comparison, retail as an industry is less standardized or less mature. The nature of the data in this industry is different. It’s more about customer behavior patterns and how long a customer is doing business with your company and what kind of history they have. This data is not always well captured in retail because it is not regulated and every company’s style of interacting with their customers differs.

Q3: Our organization is struggling to identify first steps in building our analytics program. Any advice?
PK A: It’s about how much of an investment you are ready to make. Is analytics something that is a necessity now or is it more of a long-term future project? For example, healthcare or financial services companies may find that analytics is an immediate necessity. What is the driver of your analytics investment today? Is the need driven more by the desire for information or because you need to mitigate risks? It is also important to look at either the cost of quality or cost of poor quality in the organization. Develop a business plan addressed to the right stakeholder or sponsor in the organization and assess how much the cost of quality or poor quality needs to be recouped or improved. What kind of investment is required? To bring in the right kind of skill set, people with a good mix of theoretical and practical experience is extremely important. Many organizations first invest in a tool and then see what needs to be done with it. You need to avoid all this by looking at the business need, the operational design, and getting the right stakeholders and sponsorship.

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