Report: Customer-Infused Process Improvement

1604_CustomerInfusedProcessImprovement_COVERWe just published a Temkin Group report, Customer-Infused Process Improvement, which provides five strategies for instilling customers’ needs into process improvement methodologies. Here’s the executive summary:

Process improvement and customer experience have traditionally served different roles in a company. However, these two disciplines are starting to intersect as customer experience looks to process improvement to operationalize key customer interactions and process improvement needs customer experience to provide customer-focused insights and continually monitor new processes. Temkin Group proposes that companies bring these two approaches together into Customer-Infused Process Change. This report highlights five strategies critical to driving this new approach: Prioritize Improvements Across Customer Journeys, Embrace Deep Customer Empathy, Involve Customers in Solution Development, Innovate to Meet Latent Needs, and Measure Success with Customer-Focused Metrics. To make process improvement efforts more customer-centric, organizations need to infuse these strategies across all aspects of process improvement.

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It’s time for process improvement to become more focused on customers. Rather than abandoning existing process improvement methodologies, Temkin Group recommends bringing a customer orientation into your efforts. We call this approach Customer-Infused Process Change (CiPC), which we define as:

Driving improvements based on a deep understanding of customer needs.

The report provides best practices across five strategies of CiPC:

  1. Prioritize Improvements Across Customer Journeys: By understanding customer interactions in the context of their broader journeys, companies can invest in process improvements projects that have the most impact on the customer’s experience.
  2. Embrace Deep Customer Empathy: In order to effect sustainable changes, employees impacted by redesigned processes need to understand why these changes are important to customers.
  3. Involve Customers in Solution Development: Process improvement efforts must have resources available to ensure that ongoing, incremental changes can be made based on this customer input.
  4. Innovate to Meet Latent Needs: Customers can’t always articulate what they want; instead, they often describe a slightly improved version of what they already know.
  5. Measure Success with Customer-Focused Metrics: Companies can’t measure the success of process improvement efforts with internally focused, operational metrics.

1604_CustomerInfusedProcess5Strategies

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The bottom line: Process improvements need more customer insights.

Report: What Happens After a Good or Bad Experience, 2016

1603_WhatHappensAfterGoodBadExperiences_COVERWe just published a Temkin Group report, What Happens After a Good or Bad Experience, 2016. This is our annual analysis of which companies deliver the most and least bad experiences, how consumers respond after those experience (in terms of sharing those experiences and changing their purchase behaviors), and the effect of service recovery (see last year’s report).

Here’s the executive summary:

We asked 10,000 U.S. consumers about their recent interactions with 315 companies across 20 industries, and compared results with similar studies over the previous five years. More than 20% of the customers of Internet service providers and TV service providers reported a bad experience, considerably above the rates for any other industry. Air Tran Airways, Time Warner Cable (TV service and Internet service), Comcast (TV service), and HSBC delivered bad experience to at least one-quarter of their customers. At the same time, less than 3% of Michael’s, Advance Auto Parts, Whole Foods, Publix, Subway, Vanguard, Trader Joe’s, and GameStop customers report having bad experiences. We examined the combination of the volume of bad experiences and the resulting revenue impact and created a Revenues at Risk Index for all 20 industries. At the top of the list, TV service providers and rental car agencies stand to lose at least 6.5% of their revenue from bad experiences. Conversely, less than 2% of the revenues for retailers and supermarket chains are at risk. The companies that recovered very poorly after a bad experience lost sales from 63% of their customers, more than 2.5 times as many as companies that recovered very well. Companies that do a very good job at recovering after a bad experience have more customers who increase spending than those who decrease spending. After a very bad or very good experience, consumers are more likely to give feedback directly to the company than they are to post on Facebook, Twitter, or third party rating sites. Regardless of the channel, consumers are more likely to discuss a very bad experience than a very good one. While the way that consumers give feedback has not changed much since last year, the volume of Twitter usage grew for both positive and negative experiences. Piggly Wiggly, US Cellular, Fifth Third, The Hartford, TriCare, and PSE&G face the potential for the most negatively biased feedback from customers.

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Here are excerpted versions of 4 (out of 15) graphics in the report: Read More …

Customer-Centric Culture Change (Video)

Our research and work with clients show that customer experience is a reflection of an organization’s culture. Any company that wants to build sustainable customer experience must build a customer-centric culture. How? By mastering Employee-Engaging Transformation.

Want to know more? Watch this short video:

The bottom line: CX success almost always requires culture change

Report: 2016 Temkin Experience Ratings

1603_2016TemkinExperienceRatings_FINALTemkin Ratings websiteWe published the 2016 Temkin Experience Ratings, the most comprehensive benchmark of customer experience. In the sixth year of the Ratings, we analyze feedback from 10,000 U.S. consumers to rate 294 organizations across 20 industries. Here’s the executive summary:

2016 marks the sixth straight year that we’ve published the Temkin Experience Ratings, a cross-industry, open standard benchmark of customer experience. This year, Publix and H-E-B earned the top two spots, and supermarket chains overall took six of the top 11 spots. At the other end of the spectrum, Fujitsu received the lowest score of any company, closely followed by Health Net. Five other health plans joined them in the bottom 11. To generate these ratings, we asked 10,000 U.S. consumers to rate their recent interactions with 294 companies across 20 industries and then evaluated their experiences across three dimensions: success, effort, and emotion. Publix and H-E-B earned the highest ratings for success, while Publix, O’Reilly Auto Parts, True Value, and Save-a Lot earned the highest for effort, and Publix, Chick-fil-A, and Residence Inn earned the highest for emotion. And when we looked at who had the best and the worst ratings for each industry, we found that USAA actually earned the highest ratings in two industries, while Comcast received the lowest ratings in two industries. Amazon.com, USAA, Holiday Inn Express, and Residence Inn outperformed their industry averages by the most points, while Fujitsu, Motel 6, and HSBC fell behind by the most points. Although all industries declined between 2015 and 2016, rental car agencies and health plans experienced the most dramatic drops. Meanwhile, Coventry Health Care, Con Edison of New York, and True Value improved the most over the last year, and Volkswagen dealers, Fairfield Inn, and Fujitsu dropped the most. To improve customer experience, companies need to master four competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness.

Download report for FreeFreeDownloadButton You can also download the dataset in Excel for $395

See our FAQs about the Temkin Experience Ratings.

Also, see individual snapshots of all 20 industries.

The Temkin Experience Ratings are based on evaluating three elements of experience:

  1. Success: How well do experiences meet customers’ needs?
  2. Effort: How easy is it for customers to do what they want to do?
  3. Emotion: How do customers feel about the experiences?

Here are the top and bottom companies in the ratings:

1603_2016TxR_TopBottomOrgs

***See how your company can reference these results or
display a badge for top 10% and industry leaders***

Read More …

Report: State of the CX Profession, 2016

1603_StateOfCX Profession2016_COVERWe just published a Temkin Group report, State of the CX Profession, 2016. This is the fifth year that we’ve examined the roles of CX professionals and the third year that we’ve done a compensation study. Here’s the executive summary:

To better understand the mindset and roles of CX professionals today, we surveyed 208 CX professionals and then compared their responses to similar studies we’ve conducted over the previous four years. Eighty-six percent of respondents reported that their CX efforts positively impacted their organization’s business results in 2015, while 96% believe that customer experience is a great profession to work. About nine out of 10 respondents feel satisfied with the people they work with, the content of their jobs, and the company they work for; however only 61% are satisfied with their opportunities for professional advancement. Both web interactions and voice of the customer programs continue to be key areas of responsibility for these professionals, and respondents expect spending on CX activities to grow in 2016, with text analytics and predictive analytics showing the most positive momentum. On this year’s survey, we included our third annual compensation study. We looked at 105CX professionals from large organizations and found that their average compensation (salary plus bonus) ranged from $135,000 for mid-level individual contributors to $260,000 for CX executives.

1602_DontBuyReportJoinCXPA

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Here’s some data that combines pieces of two graphic, showing that CX continues to be a great profession….

1602_CXisGreatProfession

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The bottom line: The CX profession is thriving.

Customer Experience: The Path From Fluff to Tough (Infographic)

Temkin Group’s research shows that companies evolve through six stages of CX maturity, but the higher levels of maturity take a significant jump in focus and commitment. What does that path look like? Take a look at this infographic.

1601_CXFluffToTough_infographic

You can download (and print) this infographic in different forms:

The bottom line: Make the leap from fluff to tough

Modernize Leadership: Shifting 8 Outdated Management Practices

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Over the previous decade, I’ve had the opportunity to work with and study thousands of companies. One of the things that I’ve noticed is that the world has changed a lot, but organizational management has stayed substantially the same.

Technology has enabled entirely new practices and we’ve developed a much deeper understanding of what drives human behaviors and business success. But these new realities have not been translated into how leaders run their companies. Instead, management techniques continue to reflect outdated assumptions such as:

  • Mainstream economics works on the assumption of Homo Economicus, a model of people as rational self-interest maximizers. So “agency theory” informs management that employees can’t be trusted to act on behalf of the firm and, therefore, controls must be put in place to align their efforts.
  • Strategic planning cycles (annually, quarterly) have been established based on a constraint of limited data availability. When these processes and cycles were initially created, it was impractical to more frequently pull together meaningful insights about the business.
  • Management focus has been driven by economists like Milton Friedman who argued that corporate officials have one core 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 (not just investors) who’s returns should also be maximized, especially employees who contribute their knowledge and skills.

While these underlying assumptions aren’t necessarily discussed explicitly, they frame the basic structure of today’s approach to management. Well, it’s time to Modernize Leadership. We need to redefine how we run organizations based on the realities of today, which will require more inspiring leaders in the future.

To help make the shift, I plan to write individual posts that describe eight key shifts required to modernize leadership. In those posts I’ll describe the move from:

  1. Command and Control to Engage and Empower
  2. Strategize and Plan to Learn and Adjust
  3. Amass and Review to Detect and Disseminate
  4. Measure and Track to Observe and Improve
  5. Goals and Objectives to Purpose and Values
  6. Problems and Solutions to Strengths and Appreciation
  7. Process and Projects to Culture and Behaviors
  8. Price and Features to Experience and Emotions

ModernizedLeadershipOutdatedAssumptions

The bottom line: Let’s Modernize Leadership together!

Report: Employee Engagement Benchmark Study, 2016

1602_EEBenchmarkStudy16_COVERWe just published a Temkin Group report, Employee Engagement Benchmark Study, 2016. This is the fifth year that we’ve published the benchmark of U.S. employees. The research is based on an online survey on Q3 2015. (Take a look at our Employee Engagement Resource Page).

Here’s the executive summary: We used the Temkin Employee Engagement Index to analyze the engagement levels of more than 5,000 U.S. employees. We found that employee engagement has stayed relatively flat since last year, but engagement levels still vary by organization, industry, and individual. Companies with stronger financial performances and better customer experience have employees who are considerably more engaged than their peers. Our research also shows that out of all the industries, the construction sector has the highest percentage of engaged employees, while the retail sector increased the most since last year. We additionally found that companies with 501 to 1,000 employees have the highest percentage of engaged employees and companies with 10,000 or more employees have the lowest level of engagement. On an individual level, our research shows that employees who are highly educated, high-income earners, executives, male, and have very good bosses tend to be the most highly engaged. Given the significant value of engaged employees, we recommend that companies improve engagement levels by mastering our Five I’s of Employee Engagement: Inform, Inspire, Instruct, Involve, and Incent.

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Here’s what we found when we examined year-over-year results for the Temkin Employee Engagement Index:

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Here are some other findings from the research: Read More …

15 Customer Experience Factoids From 2015 (Infographic)

Every year, Temkin Group publishes a lot of leading-edge customer experience research. In case you missed some of it, we decided to create this infographic with 15 of the top data factoids from across many of our reports:

1601_CXFactoids_INFOGRAPHIC

You can download (and print) this infographic in different forms:

Report: Lessons in CX Excellence, 2016

1601_LessonsInCXExcellence_COVERWe just published a Temkin Group report, Lessons in CX Excellence, 2016. The report provides insights from eight finalists in the Temkin Group’s 2015 CX Excellence Awards. The report, which is 100 pages long, includes an appendix with the finalists’ nomination forms. This report has rich insights about both B2B and B2C customer experience.

Here’s the executive summary:

This year, we chose eight organizations as finalists for Temkin Group’s 2015 Customer Experience Excellence Award. The finalists for 2015 are EMC Global Services, Hagerty, InMoment, Safelite AutoGlass, SunPower, The Results Companies, Verint, and Wheaton | Bekins. This report provides specific examples describing how these companies’ CX efforts have created value for both their customers and for their businesses. We also highlight best practices across the four customer experience competencies—purposeful leadership, compelling brand values, employee engagement, and customer connectedness. We have included all of the finalists’ detailed nomination forms at the end of this report to help you compile examples and ideas to apply to your own CX efforts.

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Here are some highlights from the finalists: Read More …

ROI of Customer Experience (Infographic)

People always ask about the connection between customer experience and business results. Well, here’s some visual evidence of the linkage. In this infographic, we share data from the Temkin Group research report, ROI of Customer Experience 2015.

1601_ROIofCX_Infographic

You can download (and print) this infographic in different forms:

Report: Make Your VoC Action-Oriented

1512_MakeYourVOCActionOriented_COVERWe published a Temkin Group report, Make Your VoC Action-Oriented. Here’s the executive summary:

Companies recognize that customer feedback and insights are critical for understanding customers, so they often create Voice of the Customer (VoC) programs as one of their first customer experience priorities. While most respondents within large organizations believe that these efforts have been successful, Temkin Group has found that an overwhelming number of VoC programs are still in very early stages of maturity. These immature programs overly focus on collecting feedback and don’t focus enough on driving action based on insights from the feedback. Our research shows that simplification is a key path to VoC maturity. This report identifies five strategies for simplifying VoC programs: Stakeholder Empathy, Tailored Insights, Feedback Rationalization, Loop-Closing, and Customer Journey Alignment. As companies adopt these five strategies, VoC teams must learn new skills and become research generalists, business consultants, compelling communicators, portfolio managers, and value creators.

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Here are the best practices we discuss in the report:

1512_ActionOrientedVoCBestPractices

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Report: The State of CX Metrics, 2015

1512_StateOfCXMetrics2015_COVERWe published a Temkin Group report, The State of CX Metrics, 2015. This is the fifth year of this study that examines the CX metrics efforts within large companies. Here’s the executive summary:

Temkin Group surveyed nearly 200 large companies to learn about how they use customer experience (CX) metrics, and we then compared their answers with similar studies we’ve conducted every year since 2011. The most commonly used metrics continue to be likelihood-to-recommend and satisfaction, while the most successful metric is interaction satisfaction. And although the percentage of companies where senior leaders regularly refer to CX metrics has increased significantly from last year, fewer companies are making explicit trade-offs between CX metrics and financial metrics. Companies are best at measuring customer service and phone-based experiences and are worst at measuring the experiences of prospects and customers who defect. In addition to answering survey questions, we also had companies complete Temkin Group’s CX Metrics Competency and Maturity Assessment, which examines four areas of a metrics program: consistent (does the company use common CX metrics across the organization?), impactful (do the CX metrics inform important decisions?), integrated (are trade-offs made between CX and financial metrics?), and continuous (do leaders regularly examine the CX metrics?). Only 14% of respondents received at least a “good” overall rating, and companies earned the lowest rating in integrated. Ultimately, companies with stronger CX metrics programs deliver better customer experience, have stronger business results, more frequently measure ease of doing business, and compensate more employees based on CX metrics.

See the State of CX Metrics studies from 2011, 20122013, and 2014.

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Here are the results form our CX Metrics Competency & Maturity Assessment:

1512_CXMetricsAssessmentResults

Here are some other highlights of the research:

  • Forty-nine percent of companies with stronger CX metrics programs have well above average customer experience compared to 17% of those with weaker CX metrics programs. The stronger CX metrics programs are also 50% more likely to have significantly better business performance then their competitors.
  • While 64% of respondents rate their company as good or very good at collecting and sharing CX metrics, only 22% gave themselves those high marks when it came to making trade-offs between CX metrics and financial metrics.
  • Likelihood to recommend and satisfaction remain the most popular CX metrics, while companies are most successful in using satisfaction as a measure of specific customer interactions.
  • Seven out of 10 companies have compensation tied to CX metrics for some of their employees. Net Promoter® Score is the most common metric used and customer service is the most common group to have its compensation tied to CX metrics.
  • Companies are most effective at measuring customer service and phone interactions and least effective at measuring the experiences of prospects and customers who have defected.

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P.S. Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.