By Derek Martin, a principal consultant at BSG
A customer’s perception of an organisation is determined by the journey the customer undertakes, from consideration to requesting and ultimately using a product or a service. This journey defines the customer experience and, as technology advances and users become savvier, they will demand better service, speed and personalisation.
This presents a challenge for IT departments. As business becomes more dependent on IT to fulfil objectives, so the structure of IT will either help or hinder the organisation in serving its customers.
Organisations are not keeping customers happy
Customer experience is not always perceived as positive by the customer, with many organisations failing to measure up. A 2013 Oracle Global Insights study on Succeeding in the Customer Experience Era states that executives underestimate the importance of customer experience on customer behaviour, with 49% of executives believing customers will switch brands due to poor customer experience, yet in reality 89% of customers advising they have switched because of poor customer experience.
There are a variety of factors within an IT department that can impact customer experience. Tightly-coupled legacy systems are partly to blame, as they inhibit the agility required to respond to customer needs. Managing the complexity of these inflexible architectures becomes arduous and consumes limited resources.
The people and processes required to provide IT services have their own limitations, as they’ve been structured around the traditional delivery of IT systems, with a formal split between those that build solutions and those that run services. This is relevant in an environment where the requirements are static, but falls short where rapidly adapting to changing customer needs is valued.
As business becomes more dependent and places greater demands on IT, the ability to deliver IT services that rapidly adapt becomes vital. Business will not only require additional digital channels and touchpoints with customers, but they will also need interfaces to expose services to third parties.
Organisations with complex legacy dependencies and associated outdated IT operating models will be held back by the inflexibility to change. Businesses looking to be successful in this environment of change and digitisation will need to redefine the way their IT operates, to ensure a superior customer experience.
Promoting customer-centricity through an IT operating model
An IT operating model is a blueprint that visualises and describes how resources are organised within IT and how they will operate in order to achieve ITs objectives. Key components often include roles, organisational structures, processes, tools, governance controls and the metrics used by IT.
Guidelines organisations should consider to deliver solutions to delight customers include:
~ Incorporate customer-centricity into the IT strategy
The first step is to define a strong vision for IT that aligns with the business strategy and its drivers for customer-centricity. Once the goals for IT are understood, the measures of success must be defined in a manner that highlights how IT is impacting the customer.
Modern IT organisations are aware of the need to define a strategy for IT that aligns with the intended business direction. However, IT often regards their customer as the business, without considering the fact that they impact the business’s customers. Ideally, IT needs to build awareness of the end-customer and use this understanding to guide the decisions it takes. This can be done by creating a view of the customer journeys before establishing the link between IT and key events in the customer journeys.
~ Establish the IT capabilities that support the customer-centric IT strategy
Specific functions within the operating model have a large impact on the customer and these will need to be architected for versatility and speed. Those functions that are delivering and supporting, for example the enterprise’s digital channels, are likely to receive a barrage of requests and changes and thus need the staffing and processes to be able to rapidly deliver on these. Including agile practices in an organisation’s delivery capabilities is one way of improving the ability to respond to change.
Some customer journeys are highly dependent on the effectiveness of IT, for example the journey to resolve a technical problem might depend largely on the service management function within IT. For such customer journeys, the key drivers of satisfaction must be understood and potential improvements prioritised.
The customer focus included in the IT strategy also needs to be cascaded down into the functions within IT responsible for guiding IT’s future direction, such as IT strategic planning and enterprise architecture. This is important for increasing the customer-centricity of IT over time.
~ Build the insights needed to sustain momentum
Customer satisfaction is often a qualitative measure sourced from customer surveys. While this is still a valid measure, identifying and measuring the IT metrics that influence customer experience empowers IT to address the areas requiring improvement. It also shifts the focus from traditional IT measures, such as server downtime, to measures that have a customer viewpoint – for example ideal service turnaround time versus actual service turnaround time.
Once the source of data is determined and the reporting produced, IT will have a view of progress over time. In order to make customer experience a priority in the minds of all IT staff, it is also important that selected IT measures are linked to IT function scorecards and individual performance goals.
In conclusion, despite an increased awareness of the importance of customer-centricity in organisations, the role of IT in supporting this focus is still largely neglected. This is further compounded by emerging business requirements that seek to exploit technological advancements, placing additional demands on IT.
In response, organisations need to redefine how IT operates and outline an operating model where customer-centricity is as important to IT as it is to the business. In order to do this, IT functions that have a greater impact on customer experience must be prioritised and the manner in which IT is measured must change from IT-centric measures to customer-centric views.
Failure to recognise the impact IT can and must have on the customer experience could result in companies lagging behind their competitors.