New Research: The Global State of XM

GlobalStateOfXMThe XM Institute published a new report, The Global State of Experience Management (“XM”). The research is based on a survey of more than 1,200 senior executives from across six countries: Australia, Canada, Germany, Japan, the UK, and the U.S..

Before I share some of the findings, I just want to say that this report is free to download. As I’ve mentioned in the past, one of the cool things about moving to Qualtrics is that we get to share more of our research like this. Now on to my commentary…

First of all, we found that executives around the world regard XM as important – which is not surprising given its correlation with sales growth and profitability. However, the degree to which they focus on XM varies between countries.

Canadian executives are most likely to consider improving XM a top organizational priority, while German executives are least likely. Additionally, which experience areas executives are most concerned with improving also differs from country to country. Respondents from Germany and the U.S. are most focused on customer experience (CX), respondents from Australia and Canada are most focused employee experience (EX), respondents from Japan are most focused on product experience (PX), and respondents from the UK are equally focused on EX and brand experience (BX).

This report also examines how executives expect to use customer and employee feedback in the coming year as well as what obstacles are impeding their path to XM success. Organizations that are leading the way with XM most often describe technology limitations as an obstacle, while firms that are lagging in XM point to a lack of a clear strategy as a key obstacle.

Go ahead and download the report… it’s free.

Stop Employees From Asking For Good Ratings

Over the last few weeks, I’ve run into a couple of examples of a common problem with some Experience Management (XM) programs… “gaming.” Here’s what I found…

During dinner with a friend who is an executive at a large bank, our discussion made its way to XM (no surprise). He mentioned that his bank has an employee engagement study and that leaders are compensated based on the results.

Sounds like a good thing, right?

My friend then shared a conversation that his boss had with the leadership team. This senior executive told my friend and the rest of his direct reports that they needed to give him better ratings, because the current scores were negatively impacting his compensation.

Now for the second example. I’m a frequent flier, and regularly receive requests from airlines to provide feedback after a flight.

Sounds like a good thing, right?

During a recent trip on Delta, the flight attendant announced that we’d be receiving a survey and that she hopes they exceeded our expectations and will give them a 5 (see note about Delta below).

Do these two situations sound like a path to better employee experience (EX) or customer experience (CX)? Of course not! Both of these examples represent inappropriate behaviors. Whenever a person is pressured to give a specific score, the integrity of the measurement system is broken. We call this type of behavior “gaming the system.”

Gaming is a common problem. It happens when an organization puts too much emphasis on specific measurements — at the expense of the overall XM program.

The goal of XM is not to achieve some number, but to create a discipline to continuously learn, propagate insights, and rapidly adapt. This enables an organization to consistently deliver experiences that meet the needs of its key audiences. When an organization overly focuses on a number, often by attaching strong incentives to individuals based on the data, the system is bound to create these types of counter-productive “gaming” behaviors.

To help discourage this type of behavior, consider adopting these five rules to stop employees from gaming that I’ve described in a previous post:

  1. Don’t mention or refer to a score
  2. Don’t mention specific survey questions
  3. Don’t mention any consequences
  4. Don’t say or imply that you will see their responses
  5. Don’t intimidate customers (or employees) in any way

The bottom line: Make sure you’re not encouraging gaming behaviors.

Note: I regularly fly with Delta and this is the only time that I’ve run into this type of gaming behavior.

XM Versus BI: No Real Comparison

When I was at the SAP Select event in Berlin last week, I was asked a great question… Isn’t Experience Management (XM) just like business intelligence (BI)?

First of all, they’re nothing alike. However, I understand why they may appear similar at a surface level. That’s why I really like this question; it gives me the chance to provide additional clarity around XM.

Here’s why XM is nothing like BI:

  • BI is a technology, XM is a discipline. BI is a tool that takes streams of data and transforms them into presentable formats. XM is a discipline that helps organizations deliver differentiated experiences by continuously learning, propagating insights, and rapidly adapting. Organizations adopt XM by mastering a set of six competencies that are enabled by technology and nurtured by culture.
  • BI focuses on O-data, XM adds X-data to O-data. BI collects operational data (O-data) from a number of internal systems, looking at how operations are performing. While O-data provides some insights, it lacks the deep understanding that comes from people (customers, employees, partners, etc.) who can explain why things are happening, with information about what they are thinking and feeling. That’s why XM collects this experience data (X-data) and drives insights by combining it with O-data.
  • BI enables analysis, XM embeds analytics. BI provides a platform that analysts can use to manipulate data, often connecting it with other analytical tools. A strong XM platform uses analytics at the core of its data processing engine, so that all types of users can gain instant access to deep insights. The Qualtrics XM Platform includes Qualtrics iQ, which makes it easy for novices to tap into the power of powerful capabilities such as text analytics, predictive analytics, and voice analytics.
  • BI is about reporting, XM is about acting. The output from BI is typically a set of dashboards to be reviewed by a limited group of people across an organization. An XM effort may provide dashboards, but only when that format is part of driving smarter actions across an organization. That’s why the Qualtrics XM Platform supports a robust set of workflows based on insights that drive action across an organization and can integrate into process flows within systems such as CRM and HRM.

The bottom line: XM is a capability that is woven throughout your operating fabric.

Discussing The Experience Economy With Joe Pine

TheExperienceEconomy_Ruled_2Welcome to the Experience Economy. That’s the title from an HBR article written by Joe Pine and James Gilmore in 1998. It was a seminal article, laying out the important role that experiences play in building differentiation. Pine and Gilmore went on to write an amazing book, The Experience Economy: Work Is Theater & Every Business a Stage.

The Experience Economy was more than an article or a book, it was the start of a movement. And it continues on today. As a matter of fact, Pine and Gilmore are rereleasing the book with a new forward. They’ve also created an online training series focused on helping frontline employees stage remarkable experiences.

I caught up with Joe Pine during his global travels to discuss the Experience Economy. Here are his answers to some questions I posed:

Q: How has your view of the Experience Economy shifted since you originally introduced the concept?

Pine: Interestingly, not that much! My partner Jim Gilmore and I always thought that the experience staging would grow many-fold, that every year more and more companies would embrace the Experience Economy, and it would be both caused by and cause goods and services to be increasingly commoditized. One big difference is that we used to talk about the nascent, the emerging Experience Economy — and now we say it is here. Experiences have become the predominant economic offering, what people prefer over mere goods and services. I remember having to argue with people about it, making the case of the shift into the Experience Economy; now, however, I just describe it and everyone gets it.

Q: What role does new and emerging technology play in the future of the Experience Economy?

Pine: One of the big growth arenas is in experiences that fuse the real and the virtual, including virtual reality, augmented reality, and many more possibilities I wrote about in my book Infinite Possibility. Digital technologies also enable companies to mass customize their offerings so much more than in the past, for anything that can be digitized can be customized. And that’s actually how I discovered the Experience Economy, by realizing that customizing a good turned it into a service, and customizing a service turned it into, yes, an experience! So companies can now know who their customers are, where they are, their context at this moment, and how to fulfill their individual wants, needs, and desires. The “Wow!” effect that engenders can turn such interactions into engaging experiences. I’m also enamored with the potential of 3D printing, for it makes matter programmable, effectively digitizing materials to be (almost) instantly customized to the individual.

Q: I like to talk about Experience Management as a discipline that need to be woven throughout an organization’s operating fabric. How does that mesh with your view of the Experience Economy?

Pine: I think that’s true — while companies can make progress by feel, by art rather than science, it will tend to be sporadic and lessen the chances of truly embracing today’s possibilities. Also understand that many companies aim their Experience Management activities too low, at merely making their interactions with customers nice, easy, and convenient. These are all well and good — and often very necessary before proceeding further — but do not rise to the level of staging a true, distinctive experience. As a distinct economic offering, experiences are about offering customers time well spent, not the time well saved of services. So, yes, make the service aspects of your offerings frictionless, and then use the time saved to build atop this to offerings that are engaging, memorable, and personal, experiences that customers view again as time well spent.

Q: Can you share a couple of the coolest examples you’ve seen of a company shifting it’s approach and embracing the Experience Economy?

Pine: My favorite experience stager these days is the Princess Cruise Lines unit of Carnival Corp. for its Ocean Medallion program. The Medallion is an IoT device (speaking of new technologies) that enables the cruise ship to mass customize everything on the ship — and eventually off it — to each individual guest, family, or other unit (such as wedding parties or reunions). Guests upload their passport data beforehand and then simply walk up and onto the ship without ever having to show it, as Princess crew members have tablets that identify each guest by name and picture based on their unique Medallions and welcome them aboard. Guests also specify their preferences before boarding, which Princess uses to create a mass customized itinerary that can be updated as it learns more and more about each guest. It can even learn about context, knowing for example that on the pool deck with the kids your favorite drink is an iced tea with no lemon, while in the bar with your buddies it’s a coconut mojito, and at dinner with your spouse it’s a glass of Shiraz! True, though, that as a cruise company Carnival has always been in the experience business, but now it is elevating that experience for every guest, eventually on every ship.

One of the cool things I see happening turning service providers into experience stagers is retailers, restaurateurs, and others actually charging admission for the experience! Next in Chicago, Trois Mec in LA, Noma in Copenhagen, and a host of other restaurants, for example, now have you go online to reserve a table, pay the admission fee, print out your tickets, and then present them at the reserved time for the dining experience. Even Venice, Italy, is starting to charge admission to alleviate the overcrowding in the city center.

And I’ll also mention hospitals, of which so many are taking on experience-related themes or purpose statements, such as Holy Redeemer in Philadelphia with “My. Life. Story.”, Mosaic Life Care in St. Joseph, MO, with “LIve Life Well”, or Mid-Columbia Medical Center in The Dalles, OR, with “Personalize. Humanize. Demystify.” I work more in healthcare than any other industry for the basic reason that research shows that the better the patient experience, the better the outcomes, and that is what healthcare is truly about.

Q: What advice do you have for a non-traditional experience company like a chemical manufacturer or shipping company to embrace the Experience Economy?

Pine: It may seem like a stretch, but even B2B manufacturers or service providers. First, they can understand a basic principle that in today’s Experience Economy, the experience IS the marketing. So they can stage marketing experiences that generate demand for their offerings., such as CASE Construction Equipment does with its Tomahawk Experience Center in the north woods of Wisconsin, or the World of Whirlpool on the banks of the Chicago River.

Any company can also turn mundane interactions into engaging encounters by understanding that work IS theatre. It’s not a metaphor — work as theatre — but a model for work, understanding that whenever workers are in front of customers, they are on stage and need to act in a way that engages those customers. In shipping, a costumed UPS route driver performs an act of theatre with every package she delivers, while FedEx’s overnighting is absolutely, positively theatre when its employees deliberately rush about to convey the impression of speed as the essence of the company.

Whenever I work with B2B companies I also make the same point as earlier that mass customizing their goods turns them into services, and their services into experiences — and that B2B customers can far better gauge the value of such customization than consumers can. Moreover, no business customer buys their offerings because they want their offerings; they are always the means to an end. If you supply the end rather than the means — and that means focusing (as healthcare should) on outcomes, not inputs — then you will gain much more economic value. In fact, you can then go beyond staging experiences to guiding transformations for your individual customers. And there is no greater economic value you can create than to help customers achieve their aspirations.

The bottom line: Make sure to read the book!

Three Characteristics of XM Leaders

Earlier today, I led an roundtable discussion at SAP Select in Berlin entitled “Become a XM Transformation Leader.” This is a critical theme for many executives. If you want the benefits of Experience Management (XM), then you will need to lead a transformational journey across your organization.

If you’ve been reading my work, then you realize that XM is not about the delivery of a single great experience, but it’s a discipline that’s embedded across an organization’s operating fabric that enables it to Continuously Learn, Propagate Insights, and Rapidly Adapt.

How do you embrace this discipline? By adopting what the XM Institute has defined as the XM Operating Framework, which focuses on building six XM Competencies: Lead, Realize, Activate, Enlighten, Respond, and Disrupt.

This effort isn’t easy, and it requires a multi-year journey. In order for an organization to sustain a change agenda over that span of time, senior executives need to actively drive the effort. What does that mean for those leaders?

Three Characteristics Of Transformational Leaders

In my work with dozens of companies that have gone though transformations, I’ve observed that the most effective transformational leaders demonstrate three key characteristics. They:

  1. Communicate Why
  2. Model Desired Behaviors
  3. Reinforce Change

1) Communicate “Why”

The only way to get people to truly buy-in to change is for them to understand why it’s happening. Most executives tend to under-communicate, or they over focus on “what” the company needs to be doing and “how” it will get done. If you can land the “why” message, then people will support the change from a position of ongoing commitment, instead of just as an act of transactional compliance. Here are some ways that executives can improve their communications:

  • Develop a clear script about “why” the company is going through the change
  • Develop a clear script about “why” the change is good in the long run to your organization and its employees
  • Make sure that your direct reports fully understand why the change is going on and have their own scripts
  • Make sure that you regularly discuss the “why” in your ongoing communications

2) Model Desired Behaviors

One of our Six Laws of Customer Experience is simply: “You can’t fake it.” Your organization gauges what’s truly important not by listening to your speeches or reading your email proclamations, but by observing your actions. If people see that you haven’t changed, then they won’t change either. Here are some ways that you can model new customer-centric behaviors:

  • Look for new ways to use customer or employee feedback; consider regularly calling out to customers
  • Find ways to incorporate customer, employee, brand, or product data/insights into your decision-making
  • Start asking people-centric questions like: who is the target audience and how will this help them?
  • Make the XM change a top item on your meeting agendas; even above the normal operational items.
  • Make choices about what meetings you attend or decisions you make based on the signal it sends to the organization about your support for the change

3) Reinforce Change

It’s very easy for organizations to fall back into their regular, “comfortable” routines. So you need to make sure that you continuously and very purposefully reinforce the changed behaviors. Here are some of the things you can work on:

  • Hold your direct reports accountable for change in their organizations
  • Make “leading and supporting change” a key objective that you use to measure your direct reports
  • Publicly recognize and call out people in your organization that are acting consistently with where the company is heading
  • Don’t promote anyone in your organization, even high performers, if they are not proactively supporting the change
  • Embed the new direction in the hiring and new employee on-boarding process
  • Ask people in your organization what you could be doing to more effectively support the change
  • Develop personal goals every quarter for how you will reinforce the change

If you’re a leader who’s looking to drive transformation, then make sure to focus on these three characteristics. Your actions are more important than you think.

The bottom line: Transformation takes strong, committed leadership.

Expansion Of Experience Management And XM Professionals

It’s great to see so many people starting to see the potential of Experience Management (XM). As I’ve discussed, XM is the natural evolution in enterprise transformation. XM will improve just about any organization with the infusion of intelligence and humanity.

The Discipline of XM

XM is more than just a technology. It’s a discipline that needs to be woven across an organization’s operating fabric. When an organization fully adopts XM, it will not only be fully aware of the human beings that it touches, but it will proactively cater to their needs by continuously learning, propagating insights, and rapidly adapting.

1909_CLPIRA_v1

Two Dimensions of XM Expansion

That’s the end point, but how do organizations get there? By expanding their efforts along two dimensions:

  1. Maturity of competencies. For an organization to adopt XM, it needs to build a set of capabilities that we’ve defined as the XM Operating Framework. This means mastering the Six XM Competencies (Lead, Realize, Activate, Enlighten, Respond, and Disrupt) and evolving through five stages of maturity (Investigate, Initiate, Mobilize, Scale, and Embed).
  2. Diffusion of use cases. Once an organization starts building its XM competencies, it will want to expand the use of those capabilities to other areas through diffusion stages (Isolated, Expanded, Adjacent, and Extended). For instance, a company may start with a customer relationship NPS program and expand into transactional in-product feedback effort or employee engagement.

The Rise of XM Professionals

Over the next decade, I expect to see organizations building XM competencies while expanding the places where they apply those capabilities. There will be a constant flow of learning in one area and then applying that knowledge to other areas.

You can already see that starting with customer experience (CX), which I consider to be the initial use case of XM. Skills that have been built up in CX such as shifting from annual surveys to ongoing insights and uncovering opportunities to improve with journey mapping, are now also being applied to employee experience (EX).

That’s why it’s a great time to be an XM professional. The capabilities you develop in whatever experience area you start (CX, EX, PX, or BX), will be valuable across just about every component of every organization. It’s a set of skills that will become increasingly important and will, therefore, be increasingly in demand.

The bottom line: The world needs more XM and more XM professionals.

Your Organization Is An Experience Factory

Experience Management (XM) isn’t just important, it’s the primary function of every organization. Let me explain…

The XM Institute team spends a lot of time thinking about and researching XM. Which means we spend a lot of time trying to understand how human beings think, feel, and behave.

What’s become clear is that experience is not just an interesting topic, it’s a fundamental component of life. As a matter of fact, I believe that it’s one of three core human domains:

  • Physiology: How we maintain life.
  • Psychology: How we think and feel.
  • Experience: How we interact.

Experience is the one and only way that human beings interface with the world. We create, consume, and remember experiences… that’s it.

If you want to communicate with or influence someone, then it requires some experiences. If you want to teach or love someone, then it requires some experiences. If you want to learn or enjoy something, then it requires some experiences. If you want to sell or provide services to someone, then it requires some experiences.

Our lives are a sequence of experiences strung together and built on each other. These experiences can be as mundane as ordering paper towels off Amazon or as life changing as giving birth to your first child. And though experiences themselves only last a short time, they can have long-lasting consequences, shaping our behavior, attitudes, and understanding of the world.

If experience represents how human beings interact with the world, then it’s also the input and output of every employee, every customer, every partner, every supplier, and every person that touches an organization.

Therefore, all that an organization does is create experiences. It creates experiences for the employees who spend 8+ hours every day at the organization. It creates experiences for the customers who visit its website or use its products. It even creates experiences for shareholders who benefit or lose financially based on the organization’s performance.

When you get down to it, experiences are the sole output of a company. Which means whether an organization thrives or fails comes down to the experiences it delivers.

That’s why every organization (including yours) is an experience factory.

With this new context, focusing on XM is not an optional decision; it’s already the primary activity of every organization. Think about the experience chain where your organization continually creates experiences for employees whose actions then continually create product and brand experiences for the rest of the world.

While you don’t have a choice about engaging in XM, you do have a choice about being purposeful in those efforts. Too many organizations fail to focus on the experiences they deliver and leave this fundamental activity to chance.

To create a thriving experience factory, you need to build the capabilities to continuously learn about the needs and feelings of human beings across your ecosystem, propagate those insights to the people who can take action on them, and rapidly adapt your operations to adjust experiences based on those insights.

How do you create those capabilities? By mastering Six XM Competencies, and remembering that your organization is—at its core—an experience factory.

 

The Purpose Of A Corporation, Redefined

This week, almost 200 CEO’s agreed to an updated definition of “the purpose of a corporation.” The statement was made by the Business Roundtable, a very influential group chaired by Jamie Dimon, the CEO and chairman of JPMorgan Chase.

The new definition starts like this…

Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.

This new view on purpose pulls from the community of “conscious capitalism” which has been pushing for companies to recognize a broader responsibility to society, which requires considering all stakeholders (not just shareholders) in its decisions.

My take: I totally agree, it’s a long overdue shift in leadership thinking.

For many years, I’ve argued that management viewpoints have become woefully outdated.  As I wrote in a 2009 post “Fundamental Flaws In Management Education” which captures some ideas from an amazing paper written by Sumantra Ghoshal in 2005:

Management focus has been driven by economists like Milton Friedman who argued that corporate officials have only one social responsibility: making as much money as possible for their shareholders. But the value that a company creates comes from a combination of resources contributed by different constituencies. In most cases, the contribution of knowledge and skills of employees is more important to the success of the company than the contribution of capital by shareholders. And since most shareholders can sell their shares easier than employees can find new jobs, they are actually taking on less risk. So it does not make sense to maximize the returns on only one of those resources, especially the shareholders’ financial capital.

Even Jack Welch, the ex-CEO of GE who really championed the notion of shareholder value during the 1980s and 1990s has updated his thinking and said, “On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy.”

To me, the purpose of an organization is very simple… “to create value.” All of the participants in an organization, including employees, investors, suppliers, and the communities in which organizations operate, are dedicating some of their scarce capacity to an organization. The output of those contributions should deliver value for all of those stakeholders beyond what they’d gain from dedicating those resources to other options.

The key to success is to redefine “value.” Instead of thinking of it as a stock price or monetary valuation, consider value to be a broader set of returns that come from enhancing the lives of all stakeholders.

The bottom line: Let’s define our purpose as adding value to people’s lives!

Five Recommendations For De-Emphasizing Benchmarking

Benchmarking, benchmarking, benchmarking… it’s a popular subject.

I’ve been publishing CX benchmarks for more than 10 years, so you might be surprised by my point of view on the topic: benchmarking is often overused and misinterpreted. I’m not saying to give up on the entire activity, but people often spend too much time and energy focusing on industry comparisons that aren’t necessarily an accurate reflection of the genuine customer experience.

Let me start by saying that benchmarking is a perfectly good activity. It makes sense to periodically evaluate your performance relative to competitors, especially as an input to your strategy. And it’s also healthy to look at your performance relative to companies from other industries.

While benchmarking provides value, people often let it distract them from more important activities. So here are five recommendations on how to think about benchmarking:

  1. Focus on improving, not comparing. When it comes to the use of your insights activities, it’s critical that an overwhelming majority of your efforts are aimed at finding opportunities to improve — not scorekeeping. Many executives seem to feel as though a benchmark provides a security blanket of sorts—one that shows their remit within the business is in line (or better than) the competition. Whether it’s from internal metrics or external benchmarks, knowing where you are and where you’ve been is not nearly as valuable as knowing where you should be heading. Companies often use up a lot of their feedback capacity to ask customers (and employees) questions solely for the purpose of fueling a benchmark. My advice: Optimize everything you do on driving improvements, even if it means dropping some benchmarking questions.
  2. Obsess about customers, not competitors. One of the risks of relying too much on benchmarking is that it can mask your performance when there are shifts in the market, such as new competitive options or evolving customer requirements. You may be doing well against current competitors and with existing customers while the market is slipping away from you. Your critical strategic question should be are we delivering the right experiences to the right customers?, not how are we doing versus our competitors?
  3. Compare data within studies, not across them. Every industry benchmark is based on a specific methodology, with it’s own target audience, sampling approach, timing, collection mechanism, questions, and calculations. Each of these items has an impact on the results. As I often say, sampling patterns really, really matter. It’s often ineffective to compare results across different studies unless you control for all of those items, which can be very difficult. So don’t spend too much time trying to reconcile an industry benchmark with internal results.
  4. Set goals around key drivers, not necessarily industry benchmarks. As you think about setting goals for your organization, don’t fall into the trap of relying on benchmarked metrics just because the data exists. You should be setting goals for the items that drive the overall performance of your business, which may or may not look anything like the industry benchmarks. What’s unique about your brand and what creates a loyal customer? We recommend following five steps for creating a CX metrics program, starting with higher-level goals and working your way down to metrics on key drivers.
  5. Rely on internal insights, not external data. While external benchmarks can provide a high-level snapshot of relative performance, they lack the depth and adaptability to dig into critical company-specific topics such as the needs of target customer segments and your performance during key moments of truth. The additional value of internal insights are also dramatically amplified when you combine experience data (X-data) with operational data (O-data). The ability to dig into key questions and find more meaningful insights makes building internal insights capabilities a much more valuable endeavor than digging into external benchmarks.

The bottom line: Choose actionable insights over competitive comparisons… everyday!

Talking Employee Experience and XM With Ben Granger

Our team joined Qualtrics last October to create the XM Institute, and one of the great things that we’ve found is that there are many people across Qualtrics who are experts in different aspects of Experience Management (XM). So I decided to interview one of them, Ben Granger.

1907_BenGranger

Ben is a Sr. Principal for Global EX Strategy. He spends his days thinking about and helping organizations design leading-edge EX programs. Like many of the subject matter experts across Qualtrics, Ben had a strong background prior to joining the company. He has a PhD in Industrial Organizational Psychology and has worked in EX at Verizon.

Here’s our Q&A:

Q1: We describe experience management as a discipline where organizations “continuously learn, propagate insights, and rapidly adapt.” Based on our your work with companies, what do you think that looks like for a company that is really doing well with EX?

Ben: This shows up in the mindset that the organization has around employee experience. Namely, the belief that they will never get it perfect, that EX is a moving target and that they should always look for ways to improve. It’s ironic, actually, that some of the most mature EX programs I run into are run by organizations that seem to always feel like they are behind. They have this thirst to keep pushing things forward. Companies like Quicken Loans and Rogers Communications come immediately to mind – they are always very humble about the current state of their programs but in actuality, their programs are well ahead of others in their industries. I think this is because those organizations or either intentionally or unintentionally treating EX as a discipline.

Q2: We recently defined Six XM Competencies, LEAD, REALIZE, ACTIVATE, ENLIGHTEN, RESPOND, and DISRUPT. Can you share some best EX practices you’ve seen in one or two of the competencies?

Ben: Firstly, I should say that I am a big believer that the “best practices” organizations employ should be heavily dependent on their maturity. 

1907_6XMCOmpetencies3Some of the practices that highly mature EX programs use could backfire if an organization has never done formal employee measurement before. So that is always a consideration we make when we advise our clients. 

That said, one competency that I really like is “Activate”, which is about building the skills, support and motivation for EX. This is where many organizations get stuck in a rut. Leaders see the inherent value of measuring and improving EX but when they think about increasing the measurement of EX, it sounds very daunting because of the way that EX or engagement has been measured in the past. They are jaded by the old school process. So to “Activate” the organization, you really have to change leaders’ mindsets. You have to reframe what “action planning” is, which sometimes involves calling it something different! Basically, instead of handing leaders a dense report of data and charts, give them short and prescriptive readouts that are focused on “what they should do to improve EX”. Instead of forcing them to add “action planning” to their list of things they have to do, provide the EX insights in the same tools and systems they already use. These simple practices show leaders that it can actually be simple to leverage employee insights. 

Another that is a lot of fun is “Enlighten” which is about providing actionable insights across the organization. For this one, I like to borrow the principles and practices from the customer experience side of the house. For example, if you compare how organizations structure their employee surveys and their customer surveys, there is usually a huge difference. The CX surveys tend to be shorter, more conversational, more in-the-moment, and built into the apps and systems that the customers use. On the other hand, the EX surveys are quite the opposite – they are long, tedious and oftentimes require employees to completely leave their work environment to provide feedback. And to be clear, this is absolutely ridiculous and there is no reason why this has to the case! So when we are building the enlighten competency for our EX clients, we focus on those consumer-based principles – simple things like shortening surveys, giving employees multiple avenues to provide feedback (e.g., on their mobile phones), making the survey items more conversational, integrating the feedback into the systems that employees are already using to make feedback part of the process. 

Q3: When you run into companies that are just starting their EX efforts, what are the type of things that you typically recommend that they start with?

Ben: Employee engagement surveys have been under attack in the popular press recently but honestly, I think this is one of the most practical and reasonable places to start on the EX journey. So when I work with organizations that really have never done formal EX measurement in the past, I usually recommend starting with this approach. 

1907_EmployeeFeedback4I think this is important for a couple of reasons: (1) it gives the organization an opportunity to explicitly ask their employees for feedback. I borrow that line from professor Ed Batista because I think it summarizes how important it is for organizations to “explicitly ask their employees for their feedback, (2) it gives everyone in the organization the opportunity to give feedback, and (3) it gives the organization time to build some of those competencies like “realize” and “activate” without overburdening employees or leaders.

For example, if an organization has never done employee surveying before, then before jumping to frequent pulsing, for example, they have to build trust among employees that their feedback won’t be used against them, and that their feedback matters. And on the flip side, you have to build manager capabilities to understand and act on feedback. If this isn’t a natural activity for them, it will take time to build these capabilities. And a traditional engagement survey is a great way to start building that trust among employees and those capabilities among managers. And (4) this is the progression that most organizations have taken. So it’s a well worn path and we know exactly how to evolve EX programs from that starting point. 

Q4: Thinking about the future, what are some of the things that you imagine companies will be doing with their EX programs that they are not typically doing today?

Ben: I mentioned this earlier but I think that we will see a lot more consumer-based principles make their way into EX programs. We are already seeing it happen in mature organizations but this will accelerate in the next few years with the field of XM and the continued war for talent. 

Another that I think we will see more and more of is passive listening. For example, collecting employee experience data from social media and combining those insights with insights from formal, active surveys. We have some clients that are already doing this and it appears to be highly effective so long as organizations don’t misuse them and are transparent with their employees about them. 

And of course, I definitely see much more integration across the pillars of XM. We are only scratching the surface of what’s possible today. The linkage research across EX and CX is nearly 20 years old now and yet, there hasn’t been much in the way of progress in the field since. That will change and that will change quickly. Organizations are going to move well beyond the simple link between things like EX and CX and begin to have a sophisticated understanding of the interrelationships among practices that improve EX, downstream and long term CX outcomes, the brand experiences those practices create and how those brand perceptions, in turn, impact their ability to attract and retain employees and customers. And by the way, my guess is that this whole chain of events and experiences starts with EX!

Q5: When organizations are actively trying to improve EX, what are some of the obstacles that they really need to watch out for?

Ben: Trying to move too fast – this is a self-imposed obstacle in a lot of cases and it is completely avoidable. It is very tempting to want to go from nothing to best-in-class overnight. But this is rarely (if ever) a good idea. As I mentioned earlier, you have to first build trust among employees and capabilities and buy-in among leaders. This takes time to do. And business leaders can get impatient – they invested in improving EX and they want to see returns…today! I try to set my clients’ expectations – EX programs are kind of like diesel engines – they take a little while to get going but once they are running, they just keep on going.

Making assumptions based on anecdotes – this also is super common and avoidable. The point here is that organizations should not bypass legitimate measures of EX in favor of one-off anecdotes or examples. Within XM, we talk about experience gaps and oftentimes, these gaps exist between what organizational leaders “think” is happening and what employees or customers really think. There is nothing wrong with leveraging personal anecdotes and examples but using those as the sole source of information to drive actions or processes intended to improve EX is a terrible idea.

A quick example – I was working with a large retail bank a few years ago and one of the consistent themes that came out of their annual survey was that call center employees were not happy with their “career progression” opportunities. At the time, their survey was not sensitive enough to dive deeper into what employees meant by this. A few sr. leaders reasoned that the way to fix that was to build a formal career progression program to give employees line of sight into their next move. But we suggested that before they did that, we should really try and understand what the employees meant by career progression. And sure enough, we did a follow-up survey and looked at their open ended comments and the employees were actually much more interested in stretch projects and having more autonomy in their day-to-day jobs and opportunities to do different jobs in different departments. This obviously made a huge difference in what the company implemented…and saved them a ton of money by the way.  

Q6: What most excites you about the emerging category of Experience Management?

Ben: I mentioned it a few times but I am super excited about what we can learn and leverage from the CX space. I have learned so much from my CX counterparts over the last few years.

I also legitimately think XM is going to make the business world much more human. If you think about it, what XM essentially states is that it’s actually better for business if you do right by your employees, your customers and your stakeholders. Imagine if the opposite were true or if organizations perceived the opposite to be true? IF that were the case, our lives would be much worse! 

But luckily that is NOT the case. So XM will continue to prove this to be the case and eventually the organizations that provide the best experiences will be the ones still standing…and that is a great thing for all of us!

Q7: Now for something a bit more personal, what is your favorite quote from a movie, and why does it resonate with you?

Ben: “Where we’re going we don’t need roads” – Doc Brown from Back to the Future II.

First of all, this is one my favorite movie trilogies of all time – I could watch the first two movies over and over and never get tired. 

But tying it to EX, it really resonates with me that we often think about the future in terms of what we’ve done or what we’ve had to do in the past. Like when leaders immediately get scared of something like lifecycle feedback or pulse surveys because they immediately think about how painful running that one annual survey was in the past. Sometimes, we have to forget the past and imagine what it could/should be like. 

Operationalizing XM: The Report

I’m super excited to announce the publication of new research from the Qualtrics XM Institute, “Operationalizing XM.” It describes how organizations can tap into experience management (XM) to continuously learn, propagate insights, and rapidly adapt—capabilities that can be used by just about every organization. It’s a must read (and a free download) for anyone who cares about or is just interested in XM.

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The report outlines the XM Operating Framework, and goes into detail on Six XM Competencies.

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Here’s the executive summary of the report:

An ever-increasing flow of information is shifting power from institutions to individuals, while new technologies are redefining business models and shortening product lifecycles. To succeed in this environment, organizations need to adopt a new approach that focuses more on the experiences of human beings throughout their ecosystem. How? By developing a discipline called Experience Management (XM). This report introduces this new approach and provides details around:

  • The XM Operating Framework, which is built on a combination of competency, technology, and culture.
  • The six XM Competencies—LEAD, REALIZE, ACTIVATE, ENLIGHTEN, RESPOND, and DISRUPT—that organizations should focus on to improve their XM capabilities.
  • The five stages of XM maturity that companies will progress through as they master the six Competencies: 1) Investigate, 2) Initiate, 3) Mobilize, 4) Scale, and 5) Embed. This report also includes an XM Competency & Maturity Assessment organizations can use to calculate their own maturity levels.
  • The XM Diffusion path that companies should follow as they expand their XM efforts across their entire enterprise.

Reflecting On 6 Principles Of Success

Given the recent closing of Temkin Group, it seems like a good time to reflect on what I’ve learned over the last decade or so of building a successful business, creating a world-wide association, and nurturing the CX movement. Looking back, here are six principals that have helped me succeed:

  1. Actively Simplify. When faced with new situations, it often seems easiest to add layers of rules or additional concepts. In other words, the natural flow of an organization supports increasing levels of complexity. This added complexity can cause enormous unforeseen problems, such as misalignment internally and confusion externally. As a matter of fact, I think complexity is one of the most severe, yet under-appreciated issues within large organizations. I’ve tried to address this by constantly pruning our offerings to things that we could deliver well, and rationalizing all of our content into simple, connected storylines.
  2. Tell Stories. There’s nothing more memorable than a good story. I love this quote by Jonathan Haidt, the “human mind is a story processor, not a logic processor” and this one by Philip Pullman, “Thou shalt not’ is soon forgotten, but ‘Once upon a time’ lasts forever.” That’s why I’ve always obsessed about the storyline in our research, content, training, and speeches. As a matter of fact, I spend a lot more time thinking about the storyline in my speeches than I do about the core content.
  3. Embrace Reality. One of the most impactful moments of my career was when I worked for General Electric and I heard Jack Welch say, “deal with the world as it is, not how you’d like it to be.” I’ve adopted this concept as one of my core beliefs. All too often, I see people conflate what they hope was happening with what was really happening. This leads to bad decisions based on inaccurate assumptions.
  4. Have A PoV. I consider myself a full-time student of experience design, organizational dynamics and human behavior. I’ve found that the fastest way to build knowledge is to “softly” lock into a strong point of view (PoV), and use it as a frame to examine the world. I learn by strengthening my PoV when I find things that fit into it, and adjusting or even abandoning it when I find things that don’t quite fit. That’s why the content we created has always been heavily focused on helping people develop and shape their POVs, rather than listing a bunch of tactical activities.
  5. Be Transparent. Throughout my career I’ve tried to be brutally honest. People around me know what I’m thinking, and they can trust that I am sharing my true feelings. While it’s not a good strategy for poker, it’s an approach that helps in many ways. First of all, I don’t need to expend the energy to keep track of multiple narratives. Second of all, it forces me to make better decisions. I’ve coached executives to assume that people will eventually find out what they’re doing, so they should make decisions that they will be comfortable defending in the future. Transparency also helps people anticipate how I will make decisions in the future, so they can proactively align with my direction.
  6. Care About People. Everything succeeds or fails because of people. As an extreme introvert who started his career as an engineer, it took me many years to learn this lesson. I’ve had the opportunity to build new organizations and help leaders change behemoth companies. No matter what I’m working on, I always try to empathize with the human beings who are leading the new strategies, employees who need to change what they do to make the strategies come to life, partners who need to buy into a shift in direction, and customers who will hopefully opt-into and get value from new experiences. Of all the things that I’ve been able to do, I’m most proud of the positive impact that I’ve had on people, whether I’ve met them or not. Caring about people is not only more motivating to me than driving business results, but it is also often the best path for achieving those business results.

The bottom line: I hope my lessons—from simplifying to caring—are helpful.

Goodbye Temkin Group Website…

Well, it has finally happened. After being acquired by Qualtrics this past October, we have decommissioned the Temkin Group website. And yes, I have mixed feelings. To quote a line from Winnie-the-Pooh…

How lucky I am to have something that makes saying goodbye so hard.

It’s hard to say goodbye to a site and a brand that we built and nurtured since May 2010. Over the last eight years, we’ve been blessed with the opportunity to work with the greatest team and to support the most wonderful clients anyone could ever ask for.

Temkin Group’s success was built totally on word of mouth. We never had anyone on our team with any sales responsibilities or sales goals, and we never made any outbound calls to sell our services. Here’s another interesting factoid: over the entire lifetime of our company, we never had to write off any revenue as uncollectible. Every one of our clients paid all of their invoices.

We enjoyed each and every day with Temkin Group… thank you!

And for the sake of posterity, I’ve captured a final image of the homepage.

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On the other hand, I’m absolutely thrilled.

The decision to join Qualtrics looks even better today than it did when we originally made it. The SAP acquisition of Qualtrics was certainly a curveball, but we’re even more excited about the future of Experience Management (“XM”) and the role that our team and the Qualtrics XM Institute we are creating will play in bringing it to life.

In addition, this was also a big win for the followers of our content. We are now offering almost all of Temkin Group’s recent reports FOR FREE on the Qualtrics XM Institute page. That’s very cool!

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I invite you to continue to follow our team’s journey; not as Temkin Group, but as the Qualtrics XM Institute.

The bottom line: Goodbye Temkin Group. Hello Qualtrics XM Institute!

My History Of Enterprise Transformation And XM

I’m frequently asked to share my views about the evolution of experience management (XM), so I’ve spoken (and written) about topics such as CX establishing the foundation for XM. For some recent speeches I’ve combined my personal introduction with a broader overview of the evolution of enterprise transformation.

After several requests, I’ve captured the content in this short (5 minute) video. It’s a recount of my professional experience and observations from decades of working with many large enterprises. It’s “based on a true story,” which means it’s not meant to be a comprehensive historical dissertation.

As you’ll see in the video, the world of technology and processes has changed radically in a relatively short period of time (by historical standards). Existing business models, however, haven’t come close to addressing these fundamental shifts:

  • People inside and outside of the company are now connected directly to processes and technology within the company.
  • People used to be viewed as participants in processes and users of technology, but are now being recognized, as they should be, as human beings who are driven by their needs and emotions.
  • Research used to consist of periodic studies that resulted in slides and reports, but companies are seeing the power of more continuous collection of data and wide distribution of insights.

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In this environment, XM’s combination of intelligence and humanity across the entire value chain provides a powerful catalyst for change. There’s enormous opportunity for organizations to apply this discipline to realign how they operate—and to focus more intensely on how human-beings think and feel, using continuous insights across a network of digitally connected people inside and outside of the company.

Over the next decade and beyond, XM will be the foundation that organizations use to differentiate themselves by redefining their operating models to deliver more human-centric experiences.

The bottom line: I’m really excited about the future of XM.

P.S. To understand XM, make sure to read the report, Operationalizing XM

Service NSW Tops My Worldwide XM Tour

I’m on my way back from Australia; the end to a very long, but wonderful road trip.

I’ve had a busy couple of months, delivering speeches and training in Salt Lake City (twice), London (twice), Orlando, Madrid, Sydney, and Melbourne, in addition to remote sessions in Paris and Philadelphia. What have I been speaking about?

  • Operationalizing Experience Management (XM). As I’ve discussed, XM will drive transformation across organizations for the next decade. But how do you turn XM into a discipline? By mastering 6 XM competencies (Lead, Realize, Activate, Enlighten, Respond, and Disrupt) and 20 XM skills. That’s been the core of my message. Stay tuned, you’ll be seeing a lot more on this topic!
  • The Human Experience Model. To deliver breakthrough experiences, it’s important to understand how people process experiences. That’s what the Human Experience Cycle is all about.
  • Five For The Fight. One of the most inspiring things we do at Qualtrics is to support 5 for the Fight, a foundation to put an end to cancer. It was center stage at all of the X4s, and I incorporated it into my discussions whenever possible.

My latest trip was to Australia, where I spoke at my third Qualtrics X4 Summit (on a third continent) this year. I really enjoyed the trip, except for the grueling flights. Why can’t we just get to Oz by clicking our heals three times?!?

Unlike my first trip to Australia a few years ago, this one was all about work (except for some nice meals with friends). But I’m not complaining. As you can see in the pictures, I got to experience Vivid Sydney, got close with some local wild life, enjoyed some good cuisine, and kicked up my heals in the Sydney office while enjoying the amazing view of Sydney Harbour.

Of course, the best part of the trip was getting to know my Australian colleagues at Qualtrics. It’s a dynamic, scrappy bunch, and they’re doing a fantastic job helping companies across the region adopt XM.

I was also able to visit several companies in Sydney and Melbourne. My last visit was with Qantas, which was a great way to end the trip. It was energizing to review their plans and to see how focused they are on XM. I’m really looking forward to seeing what they’ve accomplished during my next visit.

IMG_9152.jpegBut the most surprising part of my trip was a visit to two government offices. That’s right, government! I had the privilege of meeting with the newly appointed Minister of Customer Service for NSW, Victor Dominello. What an inspiration! He has a robust vision for improving how government operates, and is already changing the way that NSW interacts with citizens.

During our visit, he pulled out his mobile dashboard that keeps track of feedback from citizens across many government services. He not only cares about the how citizens are treated, he tracks it and holds the different agencies accountable for it.

Dominello’s aspirations are supported by a fantastic team at Service NSW. which is the organization responsible for interfacing with citizens. Their offices are cramped as you might expect in a government building, but the walls are filled with artifacts that make it look like you’re in a world-class design agency.

The team is applying leading-edge XM practices to understand citizen behavior and design experiences that help the government achieve its goals. It’s more than just improving service, the group is using XM tools to achieve objectives like better serving underprivileged groups.

While I enjoyed my entire trip, I’m happy to be heading back to Boston. Oz is great, but there’s no place like home!

The bottom line: XM is gaining momentum around the world, even Down Under!