The Human Experience Cycle

As you think about your experience management (XM) efforts, it’s important to understand  how people flow through the experiences in their lives — as customers, employees, patients, fans, citizens, students, etc. To help deepen that understanding, I’ve created a simple model, the Human Experience Cycle (HxC). As you can see in the chart below, the HxC is made up of five elements:

  • Expectations: What a person anticipates will happen during an experience.
  • Experiences: What actually happens to a person during an interaction.
  • Perceptions: How a person views an experience based on their expectations.
  • Attitudes: How someone feels about the organization.
  • Behaviors: How a person choses to interact with an organization.

1903_HumanExperienceCycle2

Here are some implications of the HxC:

  • Experiences are in the eyes of the beholder. How someone feels about an experience (their perception) is based on their expectations along with the actual experience. So the exact same experience can lead to different perceptions for different people. That’s why you need to think about the expectations you’re setting prior to an experience, and consider delivering different experiences based on people’s expectations.
  • Experiences are judged by the emotions they create. Our memories aren’t like video cameras, they’re more like an Instagram account where we take pictures whenever we feel strong emotions, and then we judge that experience in the future based on reviewing those pictures. That’s why it’s critical to proactively think about which emotions an experience is likely to generate, since those are the elements which will most drive perceptions.
  • Attitudes are important... Many organizations measure attitudes (e.g., a relationship Net Promoter Score) as part of their overall metrics program. This is an important area to understand, because it represents an accumulation of multiple perceptions and can often be a leading indicator of behaviors. That’s why many successful XM programs prioritize their efforts around the experiences that most highly affect attitudes.
  • …But behaviors are the goal. The success or failure of an organization is driven by what people actually do, their behaviors. Over time, you need to make sure that the attitudes you’re measuring have an actual impact on the behaviors you really care about — is NPS really driving future purchases?, or is our employee engagement measurement predicting attrition? If not, look for different attitudinal measurements that are more predictive of those important behaviors.

The bottom line:  Align your efforts around the Human Experience Cycle.

Tapping Into The Power Of Experience Management

Last week, I gave two presentations at the Qualtrics X4 Summit that focused on how to adopt experience management (XM). Here’s a glimpse of that content…

First of all, let’s get aligned: what do you expect to see in the future?

  • More or less demanding customers? (I say more)
  • More or less demanding employees? (I say more)
  • More or less access to data and analytics? (I say more)
  • More or less time to respond to changes? (I say less)

Attendees at X4 almost universally agreed with my point of view. If we’re accurate, then organizations that succeed will have to operate differently in the future than they do today. As you’ll see below, they’ll need to adopt XM. That’s great news for X4 attendees, because it means there will be an increasing demand for XM professionals.

The Future Requires XM

How will XM help organizations compete in this changing environment? By creating the capabilities to:

  • Continuously Learn. Organizations need to more effectively sense and interpret what’s going on all around them, collecting and analyzing signals from the actions and feedback of employees, partners, vendors, customers, and even competitors.
  • Propagate Insights. Organizations need to put actionable intelligence in the hands of people across their ecosystem who can use it, creating seamless access to the right information in the right form at the right time.
  • Rapidly Adapt. Organizations will need to act on the insights they’ve uncovered at an increasingly faster pace, finding ways to create new experiences and renovate existing ones.

XM can’t be an afterthought or a veneer. It also isn’t something that one or two departments think about. For an organization to succeed in an environment with more demanding customers and employees, more access to data and analytics, and less time to respond, XM must be woven into its operating fabric.

The XM Value Pyramid

To operationalize XM, you need to understand the XM Value Pyramid. It’s made up of three components:

1903_XMValuePyramid

  • XM Platform: Your organization needs to be instrumented to collect and analyze experience data (X-data) and operational data (O-data), and then distribute the insights to facilitate action. At X4, Qualtrics announced more than 40 of these new instruments to add to our industry-leading technology. We’re increasingly applying AI and machine learning to accelerate the discovery and actionability of insights.
  • XM Practices. Organizations need to change how they operate their business in order to leverage the increasing capabilities of the XM platform. This requires a new set of competencies and activities for creating leading-edge customer experience, employee experience, brand experience and product experience. The Qualtrics XM Institute is working on a competency model to help organizations master XM Practices.
  • XM Perspectives. The combination of XM Practices and the XM Platform will help you develop strong capabilities. But you won’t gain full value unless your organization’s culture and mindset embrace the new XM operating model. At X4, I introduced five XM Perspectives listed in the next section.

Five XM Perspectives

During one of my presentations at X4, I discussed these five XM Perspectives:

  1. Lead With Purpose. Purpose aligns, motivates, and empowers customers and employees, so leaders need to communicate and embrace a consistent vision and set of values.
  2. Make Change A Habit. Organizations naturally embrace the status quo and resist change. So they need to create an environment that embraces ongoing improvements and innovation.
  3. Propel Insightful Decisions. The value of and access to analytics is growing, but people don’t often embrace the potential of these data insights. Organizations need to create a mindset for using XM data to run their business, and evolve well beyond just looking for a readout of metrics.
  4. Magnify Key Moments. Not every interaction is equal, so organizations must be comfortable identifying and disproportionally focusing on the most important ones. To understand how to improve those key moments, you need to look at them through the lens of a person’s journey.
  5. Always Focus On People. Experiences are created and consumed by human beings (customers, employees, and partners), so cater to how they think, feel, and act. People are complex, so we identified six key traits of human beings to focus on.

Charting Your XM Future

I hope that you’re as excited as I am about the power of XM. I believe that it will be the core area of organizational transformation for the next decade. Companies that thrive will embrace XM to continuously learn, propagate insights, and rapidly adapt better than their competitors.

We’re at the very early stages of XM, so there’s a lot to do. Companies won’t master XM overnight, it will take a multi-year journey to understand and embed the required platform, practices, and perspectives. That’s why we’re creating the Qualtrics XM Institute, to support you along the way.  Here are some ideas for accelerating your XM journey:

  • Build single experience skills. You can can establish XM capabilities by starting or enhancing your customer experience (CX), employee experience (EX), brand experience (BX) or product experience (PX) efforts. Look to evolve from sharing actionable insights to redesigning processes that incorporate the insights.
  • Combine CX and EX efforts. Across our research, you’ll find that CX and EX are inextricably linked. We’ve found that engaged employees are a fundamental building block to good CX. If you combine those two areas, you can build on a common platform, and establish a strong, combined set of practices and perspectives. Along these same lines, you can also add PX and BX to existing efforts.
  • Build up centers of excellence. To master XM, you’ll likely need to develop new practices and perspectives across your organization. So identify one or two to start building. Here are some good areas to consider: experience design, advanced analytics, and developing a change-minded culture,
  • Engage a strong partner. Companies that embrace XM will go through substantive change over many years. And we all know that transformation isn’t easy, or linear. Rather than trying to do it alone, look for a partner that can help you go through the transformation. Start by checking out these great companies that can help.
  • Pick a strategic XM platform. As you think about your organization’s path towards XM adoption, you’ll be able to build skills faster and deploy change more effectively if you lock into a single platform. Not surprisingly, I strongly recommend Qualtrics. While there are good point solutions in the market, there aren’t any providers that come close to Qualtrics when it comes to overall scale, architecture, trajectory, and R&D investments—components that are critical for supporting a successful long-term journey.

The bottom line: To thrive in the future, embed XM into your operating fabric.

Debriefing My Qualtrics X4 Experience

X4_ImageLast week I joined more than 10,000 XM enthusiasts at the Qualtrics X4 Summit in Salt Lake City. This was my fourth X4, and the first one since joining Qualtrics. I really enjoyed seeing old friends and meeting many new ones. We have some really awesome clients!

My head is still spinning from the amazing event. Over two days, we were treated to the most incredible line-up of speakers, including President Obama, Oprah, Sir Richard Branson, Ashton Kutcher, NBA Commissioner Adam Silver, and Imagine Dragons’ lead singer Dan Reynolds. Add to that an Imagine Dragons concert, skateboard exhibition by Tony Hawk and his friends, and a dance contest to support 5 for the Fight (including tWitch). And yes, there were also a bunch of fantastic industry speakers.

There were so many extraordinary experiential elements around the event, including the environment for my two speeches. One of my talks was in a very large open space where attendees listened through headsets and the other was in an informal setting that was part of a private lounge for senior leaders. (Note: I’ll write another post to share some of that content).

Here are some of my favorite X4 moments:

  • Oprah was just purely amazing and inspiring. She talked a lot about the importance of “intention,” having clarity of your personal purpose (I am totally bought into the power of purpose). Some other lessons from her include, “your legacy is every life you touch,”  “notice what you have, not what you don’t have, and you will recognize the abundance around you,” and you need to acknowledge and validate other people. Her closing question challenged all of us: How do you use your true self in service of the world? And, I’m still chuckling about her discussion with Ryan Smith about Barnaby.
  • President Obama was so chill. He looked calm and loose, which made it very entertaining. He discussed his approach for making difficult decisions: “setup a process to figure the thing out with facts, data, and reason.” He made sure that the people in his administration were there for the right reason; not personal gain, but achieving their common mission. He required everyone to have integrity at their core. One of my favorite moments was when Obama quoted from The Departed. He discussed a scene where Mark Wahlberg’s character is asked who are you? and answers “I’m the guy doing my job. You must be the other guy.” Obama said that his staff would often use the phrase “Don’t be the other guy.” He also left us with an important charge, “focus more on our common hopes, dreams, and values, not on the things that pull us apart, and we can accomplish great things.
  • Adam Silver really surprised me. I’m a big fan of his work with the NBA, and have seen him speak at the MIT Sports Analytics Conference. But I never knew he was such a data guy. He discussed XM, like a pro. He clearly articulated how the combination of SAP and Qualtrics would help the NBA. He even discussed X-and O-data!
  • Sir Richard Branson was truly authentic. He seems like a great person to work for. He discussed how you purposely help more and more people as you get successful, expanding the circles from yourself, to your family, to your community, to the world. He called the American holiday system “a total disgrace” for not allowing workers to have more time off.  Branson believes that “every day is a fantastic learning experience,” and he also believes in promoting from within and delegating. This is what he had to say about brand, “you are only as good as your reputation, and you will need to zealously protect it.” He will only get into a new business if employees will be really proud and customers will sing its praise.
  • Bill McDermott explained why SAP & Qualtrics makes so much sense. He described SAP as a company with ‘a great brand and a good heart.’ Not only is that the type of company I want to work for, but it’s also how I would love to be personally viewed by other people. McDermott labeled XM as “the ultimate category” for enterprise software. He summed up the acquisition with a quote from Jerry Maguire, “Qualtrics completes us.” You can see a lot of what he said in this really good article.
  • Qualtrics employees delivered awesome content. Ryan And Jared Smith did a great job sharing the XM vision and highlighting amazing new capabilities in our XM platform. I was really proud of all of the Qualtrics speakers that I was able to see. The overall storyline at the event was that organizations often fail because they get blindsided; they lack good instrumentation. In order to deliver breakthrough experiences, you need more XM instrumentation.
  • Our new offerings are incredible. We announced a crazy number of game-changing additions to the Qualtrics XM Platform. We’re using AI in many areas across the platform, including to analyze data and create automated alerts about potential problems and opportunities. And our new mobile experience is pretty cool as well. Here are links to some of the other announcements:

I’ll end this post with a shout out to our XM Breakout Artist Winners:

  • CX: American Express
  • EX: Coca-Cola
  • PX: Belkin
  • BX: Sofi
  • XM: L.L.Bean

The bottom line: X4 was amazing; I’m already looking forward to next year.

The Evolving Role of CX (& XM) Leaders

Last week I spoke at a local CXPA meeting in Boston. We had a great turnout, thanks to the great work of the planning committee and the wonderful space provided by Education First.

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I led a discussion about the future of CX, which I believe was applicable to all experience management (XM) leaders. One of my key messages was that we need to think of our roles differently as we push our organizations to even higher levels of CX/XM maturity. Here’s how the role of CX/XM leaders need to change:

  • Early stages of maturity: WHAT WE DO. In the early stages of maturity, you need to build a strong team, a clear message, and a solid work plan. You need to enlist a few external supporters, but a large majority of the effort is driven by your team.
  • Middle stages of maturity: HOW WE INFLUENCE. Once you have some momentum and clarity around priorities, your team needs to shift focus from being doers to being facilitators. You need to build a much broader coalition of supporters and collaborators, and support them as they make changes within their organizations.
  • Advance stages of maturity: HOW CX/XM THRIVES. Once you’ve hit the larger stages of maturity, you need to make sure that good CX/XM practices are not only being deployed, but they’re being embraced. You should be helping leaders across the organization to embed the new practices within their core operations, and find ways to continuously improve on them. Deploying good CX/XM approaches isn’t good enough, as those activities must be nurtured so they don’t get stale over time.

I hope you are able to lead your organization to the advanced stages of maturity. If you do, you’ll likely need to change your approach many times along the way.

The bottom line: CX/XM leaders’ job description shifts from doing to nurturing.

The Engaging Power Of Employee Feedback

Does your organization listen to its employees? I mean, really listen and act on what they say. Based on what our research has uncovered, it’s likely that the true answer is “no.” Check out some data from our recent research:

  • In our Q3 2018 Consumer Benchmark Study, we found that 40% of full time U.S. employees strongly agrees with the statement, “My company asks for my feedback and acts upon what I say.”
  • In the report, Employee Engagement Competency & Maturity, 2018, we found that only 40% of executives within large organizations  put a high priority on taking action based on results from employee engagement studies.

Does it really matter? Yes! While there is enormous value from using employee feedback to improve your business, the true win might be in how it improves the engagement level of those employees.

To understand this phenomena, we examined the relationship between how employees think their company listens to and acts on their feedback, and the degree to which those employees are willing to do something good for their company even if it’s not expected of them. Eighty-two percent of employee who strongly agree that their company takes action on their feedback are likely to do something good for the company, compared with only 30% of those who do not agree.

We decided to dig deeper into the data and look at how this relationship differs across employee roles. As you can see in the chart below:

  • Executives (87%) are the most likely to do something good for the company if their feedback is acted upon.
  • Financial services sales or relationship management employees (19%) are the least likely to do something good for the company if their feedback is not acted upon.
  • The “do-good gap” is largest for B2B sales or relationship workers, where there’s a 65-point difference in employees’ likelihood to do something good for the company based on how the company deals with their feedback.

1902_EmployeeFeedbackValue3

The bottom line: Employee feedback is an under-appreciated gift.

6 Winning Lessons From The New England Patriots (For All Organizations)

The New England Patriots just won the AFC Championship, earning a trip to their third straight Superbowl. As a Patriots fan, I’m thrilled. I know that many people don’t like the team, but there’s no denying that the Patriots have built a dynasty and are one of the most dominant teams in recent history (across any sport).

How do the Patriots keep achieving success? By implementing a system that creates winning teams. Every year there’s a different set of players, coaches, and schemes, but the team has embedded a consistent approach and culture through its longtime owner (Bob Kraft), head coach (Bill Belichick), and quarterback (Tom Brady). While there’s a ton of different things we can learn learn from the Patriots’ success, I’ve identified six key lessons that will be valuable for almost any organization…

Lesson #1: Build a cohesive team, don’t just rely on a few great players.

Over the course of a season, 60+ different players play in a game for an NFL team. Even if you have a few superstars doing great work, the team won’t succeed unless dozens of other players work in a highly coordinated fashion. The Patriots do a great job of recognizing that each player has the potential to help or hurt a team’s chances of winning, so they sign players who will fit in their overall system and train them on a variety of roles.

There is an old saying about the strength of the wolf is the pack, and I think there is a lot of truth to that. On a football team, it’s not the strength of the individual players, but it is the strength of the unit and how they all function together.” – Bill Belichick

Lesson #2: Focus on your next step, not the vast future.

The Patriots are famous for saying that they’re focused on the next game, unwilling to spend too much time thinking about all of the future twists and turns that may happen in their season. This clear focus on what’s in front of them allows the team to hyper focus on preparing for the next opponent on the schedule.

“Every game is an important game for us. Doesn’t matter what’s the next week – who we play, whether it’s a bye week, Thanksgiving, Christmas, Halloween, Columbus Day. We don’t care. We’re just trying to go out there and win a game.” – Tom Brady

Lesson #3: Learn from the past, don’t dwell on it.

The Patriots don’t overly focus on previous games, whether it’s celebrating a win or lamenting a loss. They only look backwards for the purpose of identifying how they may be able to improve in the future.

“I don’t care about three years ago… I don’t care about two years ago. I don’t care about last year. The only things I care about is this week” – Tom Brady

Lesson #4: Constantly improve, instead of aiming for instant success.

I’m always amazed how the Patriots seem to play their best football at the end of the season. Early in this season I didn’t think the team was nearly good enough to go to the Superbowl, but the team has managed to play like the best team in football over the last two playoff games. I believe that this is a result of Belichick’s and Brady’s relentless focus on improvement.

We’ll continue to work hard to do a better job in every area going forward. I don’t know where those little things will come from but we’ll continue to be diligent on them.” -Bill Belichick

Things don’t correct themselves, you’ve got to go out there and work hard to correct them.” – Tom Brady

Lesson #5: Prepare to “do your job,” rather than talking about it.

The Patriots are known for the saying, “Do Your Job.” This is about making sure that the entire team understands the overall goals and each member recognizes their specific role in helping the team achieve them. Rather than engaging in too much dialogue with the press or making other public comments, the Patriots get ready to do their jobs. It’s powerful when every person in an organization focuses on being prepared, which only happens when they know that all of their their coaches and teammates are doing the same. 

Whatever success I’ve had it is because I’ve tried to understand the situation of the player. I think the coach’s duty is to avoid complicating matters.” -Bill Belichick

Mentally, the only players who survive in the pros are the ones able to manage all their responsibilities.” -Tom Brady

Lesson #6: Look for talent, but hire for much more.

Tom Brady was selected 199th in the 2000 NFL draft, but has become one of the greatest football players of all time. There have been a lot of players who’ve had more raw talent than Brady, but his desire to win and work ethic has propelled him to the top. That’s why you need to look for employees who aren’t only talented, but they also have the character and motivation to learn, adapt, and succeed.

Talent sets the floor, character sets the ceiling.” – Bill Belichick

“A lot of times I find that people who are blessed with the most talent don’t ever develop that attitude, and the ones who aren’t blessed in that way are the most competitive and have the biggest heart.” – Tom Brady

The bottom line: We can all learn from the Patriots winning ways.

The Inextricable Link Between CX & EX

CXEX_LinkedIn.pngIf you’ve followed our research, then you know that we’ve always viewed employee engagement as a fundamental component of customer experience.  One of our Six Laws of Customer Experience is that “Unengaged employees don’t create engaged customers.” It just makes sense. How can you possibly expect to consistently deliver great customer experience with apathetic or disengaged employees?!?!

Although the connection between customer experience (CX) and employee experience (EX) may seem obvious to many people, it’s important that we periodically test the linkage. So we took a look at the data from our survey that drove the report, State of CX Management, 2018.

We started by splitting the 194 respondents from companies that have 1,000 or more employees into three groups based on how they rated the customer experience that their organizations currently delivers compared with their competitors:

  • 51 companies that deliver considerably above average CX (“CX Leaders“)
  • 61 companies that deliver slightly above average CX (“CX Moderates“)
  • 82 companies that deliver average or below average CX (“CX Laggards“)

We compared their responses to Temkin Group’s 20-question CX Competency & Maturity Assessment. As you can see in the chart below:

  • The percentage of CX Leaders who earned “good” or “very good” employee engagement ratings is more than 5-times larger than the percentage of CX Laggards.
  • Most organizations have a long way to go on EX; less than 40% of CX Leaders are good at it–and they’re the best!
  • CX Leaders significantly outperformed CX Laggards across all five employee engagement behaviors in our assessment. Here are the gaps in the percentages of companies that either “always” or “almost always” demonstrate these behaviors:
    • My company celebrates and rewards the employees who exemplify its core values (32 %-point gap)
    • My company actively solicits and acts upon employee feedback (35 %-point gap)
    • Managers are evaluated based on the engagement level of their employees (38 %-point gap)
    • The human resources organization is actively involved in strategic initiatives (36 %-point gap)
    • My company provides employees with industry-leading training (31 %-point gap)

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The bottom line: EX is a fundamental enabler of CX.

My 12 (XM)AS Wishes For You

Since tomorrow is Christmas, I decided to share 12 wishes for you and your experience management (XM) efforts. Here goes…

During the upcoming year, I hope that you:

  1. Celebrate successes. It’s easy to get caught up in thinking about the next milestone to achieve, but make sure to regularly take account of the great things that you and your team have already accomplished. You’ve earned it!
  2. Stay positive. XM professionals, by definition, are change agents trying to drive improvements at a pace that is often faster than organizations can absorb. Don’t let the inevitable obstacles, and seemingly slow progress get you down. Remain energized and focused on the vision of a better future.
  3. Make insights actionable. Many organizations have established programs to collect feedback about customers, products, brands, and employees. It’s time to focus less on collecting data, and more on finding ways for insights from that information to more drive more impactful decisions across your organization.
  4. Remain human-centric. Our world is full of documents, data, and deadlines, so it’s easy to lose sight of what XM is all about—people. Stay focused on how your activities are affecting customers, employees and partners at a human level, keeping in mind the six traits of human beings.
  5. Lead with purpose. Rather than pushing people to adhere to your agenda, find ways that encourage them to share your commitment. How? By demonstrating the Five Ps’ of Purposeful Leaderspassionate persuasive. positive, propelling, and persistent.
  6. Express appreciation. Positive psychology research shows that people perform their best when they feel appreciated, and the act of showing appreciation makes people happier. Find ways to proactively look for and acknowledge the positive aspects of the world around us.
  7. Keep brand promises. The experiences that your organization delivers should reflect and reinforce its brand values. So make sure you clarify what makes your organization special, and identify the key promises that you’re committed to keeping with customers, partners, and employees.
  8. Get enough sleep. Let’s face it, you can’t be very effective when you’re tired. And the lack of sleep actually has a detrimental affect on your health.  So make sure you regularly get eight or more hours of sleep per day.
  9. Accelerate improvement cycles. Rather than waiting to hear from a lot of customers or employees about a problem, find ways to monitor their behaviors and feedback to find patterns that represent potential issues—and remove those obstacles before most people even notice them.
  10. Embrace diversity. The world is full of different types of people with unique backgrounds and points of view. Rather than allowing our differences to fuel tension and discord, find ways to appreciate the diversity and to treat each other as wonderfully unique individuals.
  11. Get more predictive. Once you combine experience data (X-Data) with operational data (O-Data), which you need to start doing, you’ll be in a position to apply more predictive analytics to uncover insights and recommend actions. It’s time to build up your organization’s expertise in these types of analytics.
  12. Extend compassion. All around us are people who can benefit from our care and comfort. We often don’t notice them, or we just ignore their needs. We can all do a better job of tuning into the condition of the people around us and care about their well-being.

Actually, my real hope is that you and your family enjoy a happy, healthy, and meaningful holiday season.

The bottom line: Happy holidays!

CX Myth #6: Compensation Drives Good CX Behaviors

CX Myths: Debunking Misleading Beliefs About Customer Experience

Many common beliefs about customer experience are misguided, based on oversimplifications or a lack of consideration for real-world constraints. In this series of posts, we debunk these myths.


CX Myth #6: Compensation Drives Good CX Behaviors

What’s Wrong: Many organizations try to drive behavior change by tying employees’ compensation to customer experience metrics. While some level of compensation tied to CX can be helpful, it is often overdone. When you overly compensate on a single metric, it can often lead to unintended and detrimental consequences. Symptoms of these counterproductive behaviors include pestering customers for scores; focusing on activities that may improve scores, but aren’t good for the business; and actively debating the accuracy of the metrics. Rather than engaging in these activities, we want employees focusing on ways to improve customer experience.

What’s Right: Don’t use compensation to drive behavior change; instead, use it to reward good behaviors. With that in mind, you need to find other mechanisms to drive change, such as appealing to employee’s four intrinsic needs; their sense of meaning, control, progress, and competence. As I’ve previously written, keep in mind these three underlying principles about compensation:

  1. If there is significant compensation tied to any metric (including customer feedback), then people will look for ways to manipulate the measurement.
  2. If people don’t understand a metric, then tying compensation to it will have little impact on their behavior and any downside in compensation may create negative behaviors.
  3. If people don’t understand how they personally can affect a metric, then tying compensation to it will have little impact on their behavior and any downside in compensation may create negative behaviors.

What You Should Do:

  • Treat CX as a team sport. Your customers’ experience is almost never the result of a single person, even if that person is the only one interacting with the customer. So focus on team-level metrics and compensation that encourages key groups of employees to work together towards a shared objective.
  • Use an organization-wide CX metric. Developing a core CX metric for the entire organization that is tied to some compensation (not too large), is a great way to show commitment to improving CX, and it will encourage a regular dialogue about your overall CX performance.
  • Bias rewards towards the upside. Consider starting with a compensation plan that is biased towards upside. In other words, you may want to introduce the plan where there is little negative impact on compensation if the group doesn’t hit a goal, but there is positive impact of they exceed it. This can help eliminate some of the negative perceptions early in a program.
  • Celebrate good CX behaviors. Compensation is not the only reward system in an organization. If you want employees to behave in a certain way, then provide them with positive role models. Find ways to highlight employees who are demonstrating the behaviors that you would like others to emulate. This can include monthly or quarterly awards, shout outs at company meetings, or highlights across your internal communications.
  • Make it unacceptable to game the scores. When an employee asks a customer to “give me a 10 on a survey or I’ll get fired,” can you really count on the accuracy of that customer’s rating? This may be an extreme example of “gaming feedback,” but many versions of this behavior occur all the time. To keep gaming feedback in check, it’s important to be explicit with employees about what the company considers to be unacceptable behaviors.  I’ve identified five rules that you should strictly enforce with employees, which includes not talking with customers about survey questions, scores, or consequences.

The bottom line: Use compensation to reinforce, not force, good CX behaviors.

2019 XM Trends From Qualtrics Thought Leaders

This is the time of year for holiday cheer, family celebrations, and, of course, listings of annual trends!

To help me identify trends for 2019, I reached out to some of the many thought leaders across Qualtrics and asked them to share one or two of the top experience management (XM) trends they are expecting to see in the coming year.

It was a great exercise. We have some amazing people across Qualtrics who regularly help organizations master all aspects of XM: Customer Experience (CX), Employee Experience (EX), Brand Experience (BX), and Product Experience (PX). And the trends they shared highlight the enormous amount of learning and maturing that’s currently happening in the field of XM. For the sake of simplicity, we organized their trends into four broad categories:

  1. Humanizing through Technology
  2. Tailoring Insights for Action
  3. Expanding Predictive Analytics
  4. Authentically Living Brand Values

1) Humanizing through Technology

Companies are starting to recognize that their customers (and their employees!) are real human beings, with their own emotions, wants, needs, beliefs, and motivations. Companies are using technology and data to not only deepen this understanding, but also deliver more emotionally resonant experiences. Here are some trends from our experts:

  • Adaptive, Conversational Listening. “Survey” has a pejorative overlay in the common vernacular in the U.S. today. Customers are over-surveyed with surveys that benefit only the company and not the customer. We’ve come up with a way to change the survey to a conversation, whilst preserving methodological rigor around validity and repeatability. Our method seems simple but is built on a sophisticated process within Qualtrics. First, we identify the conversational aspects of the feedback request before we engage a customer. A conversation is a give and take, a social contract between two people (personas, in abstract) who are exchanging a number of responses that include emotions, meanings, motivations, and memories evoked by current, previous experiences and the cues of the conversation. We identify the main constructs that we are dealing with as part of this feedback strategy: the company, the Feedback Conversation and the Persona who represents the customer, and we adapt the feedback requests based on the customer response.  (Carol Haney, Head of Research & Data Science)
  • Make It Matter To Me. The advancement and application of artificial intelligence is already enabling more meaningful customer experiences. Whether it’s via chatbot, or a truly personalized experience, artificial intelligence has the potential to truly humanize endless reams of data. (Juliana Smith Holterhaus, Ph.D., Senior XM Scientist)
  • Quantify & Discuss Customer Emotions. Thanks to rapidly evolving technologies, in 2019, I expect to see more companies measuring and discussing customer emotions. Emotions play an essential role in how we make decisions and form judgments, and consequently, they significantly impact our experiences with and loyalty to different companies. And yet companies have historically ignored emotions – dismissing them as too squishy and unquantifiable. However, recent advances in technological capabilities – such as cloud storage, processing power, machine learning, AI, natural language processing, etc. – are allowing companies to start identifying and quantifying their customers’ emotions. For example, companies can now use speech or text analytics to automatically surface emotions during customer service conversations, and new analytics can infer customers’ emotions based on their digital body language (e.g. scrolling, clicking, hovering). Additionally, machine learning enables companies to uncover patterns in customers’ behaviors and preferences, allowing them to proactively address problems and personalize customers’ experiences. (Isabelle Zdatny, CCXP, Qualtrics XM Institute)
  • AI To boost Frontline Productivity. We are increasingly seeing more companies incorporate sophisticated technologies such as virtual agents to enable smarter self-service in order to rethink operational processes and deliver immediate gratification. Contrary to beliefs that virtual agents will start to replace agents in frontend operations, we actually expect AI to help drive adoption of virtual assistants to become the primary channel of self service, while saving effort and time for agents and increasing their overall productivity, whereby they can focus on being a source of revenue rather than be a cost-center by selecting and presenting the best possible solution to the customer when engaged in LIVE calls. But, the focus will need to be maintained on relying on mechanisms which can also distinguish when the customer is confused and can understand and distinguish based on that emotion to engage a live agent – so ultimately the experience is frictionless, yet effortless from all involved. (Arpana Luthra, Principal Consultant, CX Practice)
  • Augmented Reality Will Redefine XM. Technologies like augmented and virtual reality will be important in elevating overall experiences and improving decision making. These technologies will make shopping easy, convenient, attractive and certainly differentiated – enabling customers to touch, feel, discover and explore products to create an experiential environment giving them a realistic feeling of the product or service experience much before they make a purchase decision. This will require businesses to re-imagine their people, process, technological and service strategies while ensuring they continue to deliver to their brand promise, but do so more effectively. (Arpana Luthra, Principal Consultant, CX Practice)

My Take: Organizations will increasingly focus on the fundamental component of XM—human beings. It’s important to start with an understanding of how people think, feel, and act. How can organizations apply this knowledge? By applying the Human Conversational Model to all interactions, including the growing number of digital touch points.

2) Tailoring Insights For Action

While most companies are now fairly proficient at data accumulation, collecting data just for the sake of collecting data is not useful in and of itself. Companies must actually use these insights to drive customer- and employee-centric decisions across the entire organization. To do this, they need to be strategic about how they collect information, how they tailor the information to their separate audiences, and how they use that information to identify and act on improvement opportunities. Here are some trends from our experts:

  • Activating Managers’ Engagement Skills. More companies are recognizing that a strong culture and engaged employees are not a result of HR tactics, but on how effectively individual leaders and managers are connecting with employees. I’m seeing more companies putting time into helping managers understand their role in employee engagement and identifying and removing time-consuming administrative tasks that get in the way of managers supporting, coaching, and recognizing employees every day. Companies are also working on improving the feedback managers get so that it enables managers to have more productive conversations with their employees about what’s working and not working on the job. (Aimee Lucas, CCXP, Qualtrics XM Institute)
  • From Survey To Strategy. I’m beginning to see organizations ask how the annual engagement survey can best fit into their overall people strategy. Leaders are taking an interest in linking survey results to business outcomes, aligning surveys along multiple points in the employee journey, taking action that will impact the business both immediately and 3-5 years from now. Surveying is no longer an annual look backward, but a strategic tool in moving forward. These conversations are exciting for both the client and Qualtrics. (Kara Laine, XM Scientist)
  • High Frequency Feedback Isn’t Helping. We have had several customers this year pull back from a monthly employee survey strategy to something Quarterly or even Semi-Annually. Their manager report not having the ability to action it before the next survey goes out and they are overwhelmed by the frequency. We find that instead our successful customers are working to connect with employees at meaningful touch-points, such as during onboarding or on a work anniversary, rather than focusing on frequency. (Austin Nilsson, EX Delivery Services Manager)

My Take: As I wrote in a post earlier this year, the future of VoC is insight & action, not feedback. Companies are increasingly recognizing that they need to drive four different action loops. This requires them to tailor insights to fuel different decision-making processes across an organization. That’s why Qualtrics is so committed to helping our customers deliver role-specific insights.

3) Expanding Predictive Analytics

Customers and employees increasingly expect companies recognize them as individuals, anticipate their needs, and proactively address their concerns. To meet these rising expectations, companies are using powerful analytics engines to combine rich customer and employee feedback with reams of CRM and operational data, surface meaningful patterns within that data, and then generate predictive models that allow for proactive, personalized experiences. Here are some trends from our experts:

  • Hyper-Contextualized, Not Personalized. A positive, consistent experience has long become a table stake. Today’s customers want organizations to respect their time. A good product at a competitive price is no longer the basis for differentiation. Truly customer-centric organizations will increasingly leverage data-driven analytics to spot customers’ buying patterns, behaviors across channels and touch points to design experiences and content, at a time customers want it and deliver them proactively rather than reactively. Customers will increasingly look for a unique, customized experience that is memorable and reminiscent of a personal relationship. There will likely be a rise in teams and knowledge centers focused on identifying the experience along these personalized journeys. Closely tied will be the importance of measuring customer emotions and understanding how they feel in the moment because customers who have a negative experience during a brand interaction are more likely not to forgive that company. We expect analytics to not only empower brands to personalize experiences, but also enable them to identify and prevent issues before they would happen, so they can now shift resources not to problem solve but to get ahead of them. (Arpana Luthra, Principal Consultant, CX Practice)
  • People Analytics. People analytics involves deriving insights from employee data and advanced analytics to make talent management decisions to drive revenue and growth. Over 70% of companies now consider people analytics a high priority, but only 10% believe they have a good understanding of which talent dimensions drive performance in their organizations. People analytics may be leveraged alongside data captured at every employee touchpoint to develop algorithmic selection systems, dynamic workforce planning models, and social networks informing organizational silos and influence between and within teams – to name a few possibilities. (Brandon Riggs, EX Internal Program Lead)

My Take: Historically, insights have been used to describe what has happened in the past. While this retrospective provides value, the ultimate objective is to use insights to prescribe best actions for the future. As predictive analytics becomes more accessible and companies blend together X- and O-Data, we’ll see a surge in predictive recommendations. Qualtrics is putting a lot of energy into making these advance analytics much more accessible to business users.

4) Authentically Living Brand Values

People want to interact with organizations whose policies and practices align with their personal principles, ideals, and attitudes. Companies can build trust and emotionally engage both their customers and employees by authentically championing social causes and demonstrating that they share the same values as their target customer segments. Here are some trends from our experts:

  • Merging Inclusivity And CX. We’ve seen multiple news articles over the past year surrounding how companies can create better online experiences for customers with disabilities. One of my favorite CX-related stories from 2018 was on the work of the Hearing and Speech Agency in Baltimore, MD. The organization is working with D.C. area restaurants to train workers on how to understand and create enjoyable experiences for customers with speech disabilities and disorders. Starbucks also opened its first U.S. sign language store in Washington, DC this past year. (Stephanie Thum, CCXP Chief Advisor, Federal Customer Experience)
  • Maturing Of Customer Journey Mapping. Customer journey maps will sustain their momentum as a popular tool to diagnose and design customer experiences. Successful journey mapping companies avoid the common of mistake of assuming the map itself is the “finish line” but rather bring cross-functional subject matter experts together who use the map’s findings to take action around the key moments of truth that deliver on an organization’s brand promises. In 2019, more companies will use journey maps to highlight the emotional impact of the experience as a way to raise empathy for customers among employees, regardless of their roles. Companies will also shift from using maps solely to capture the current state experience and begin to use them to keep the broader journey in mind while innovating future-state customer interactions. (Aimee Lucas, CCXP, Qualtrics XM Institute)
  • Fusing The Concepts Of Ethics And BX. Customers oftentimes look to online reviews and ratings to make decisions, anticipating or expecting experiences that may be based on those reviews and ratings. But what about when reviewers have been compensated to write positive reviews, incentivized to do so with a discount on a future purchase, or reviews are just plain fake? Similarly, what are the CX ethical implications of score begging, when auto dealerships, for example, beg for 10s on a survey, rather than allow customers to provide an honest review that would then possibly trickle out via marketing to other, future customers? How do we consider and think about these things when creating or honestly evaluating the experience customers are having with brands? (Stephanie Thum, CCXP Chief Advisor, Federal Customer Experience)

My Take: For an organization to optimize its CX, BX, PX, and BX efforts, it must have a deep understanding of its core values. Without this clarity around a true north, it’s nearly impossible to align priorities across an organization. We’ve seen companies live their values by translating customer promises into employee actions —and we expect to see even more of this activity going forward. I recently discussed how Starbucks should have used this approach for training after its recent issues.

The bottom line: 2019 will be an exciting year for XM!

CX Leaders’ Employees Feel Prouder & More Appreciated

If you’ve followed our research, then you’ve likely seen a strong, almost inseparable link between between customer experience (CX) and employee experience (EX). We continued to find that connection in our latest consumer benchmark.

In our Q3 2018 study, we asked 5,000+ U.S. employees to pick a word that best describes how their job makes them feel and split those responses based on how they judged the overall CX that their company delivers. As you can see in the figure below:

  • More than 80% of employees that picked “proud” and “appreciated” work in organizations that they believe are CX leaders. “Confident” is next on the list at 74%.
  • When employees picked “embarrassed” and “angry,” they were the least likely to work for CX leaders and the most likely to work in CX laggards.

Employee attitudes versus customer experience (CX)

The bottom line: CX leaders have proud employees, CX laggards have angry ones.

CX Myth #5: Wow Customers During Every Interaction

CX Myths: Debunking Misleading Beliefs About Customer Experience

Many common beliefs about customer experience are misguided, based on oversimplifications or a lack of consideration for real-world constraints. In this series of posts, we debunk these myths.


CX Myth #5: Wow Customers During Every Interaction

What’s Wrong: While it may be appealing to think about creating an amazing experience every time you touch a customer, it’s just not appropriate or practical. All interactions should aim to meet your target customers’ success, effort, and emotional expectations, but in many cases they aren’t looking to be wowed. And if we put the same energy into all interactions, then we are underinvesting in the situations that matter the most to our customers.

What’s Right: Customer experience is not about wowing customers, it’s about delivering on your brand promises. Otherwise, companies that wanted to be great at customer experience would face an endless escalation of costs as they continue to layer on wow-inducing elements across their customers’ lifecycle. You need to understand how you want to be differentiated in your customers’ eyes (brand promises), and make investments in customer experience that bring those differences to life.

What You Should Do:

  • Elevate your brand promises. If you don’t know what makes you special, then you will never be able to effectively prioritize your resources. Start by making clear brand promises, then embrace those promises by helping all employees understand what those promises mean and what role they personally play in making the promises come to life. Finally, keep the promises by holding each other accountable to them on an ongoing basis and measuring yourself against them.
  • Master key moments. A handful of moments disproportionately impact your customers’ perceptions of your organization, and therefore disproportionately impact their loyalty. First identify these moments, and then invest in making those moments emotionally resonant experiences that reinforce your brand promises.
  • Focus on customer expectations. Delivering a great experience does not mean being better than your competitors. Their brand promises may be different than yours, or they may not be setting the right bar for key moments. Instead, measure yourself against your customers’ expectations. Are you exceeding your brand promises in the eyes of your key customers? If the answer is “an easy yes,” then you may want to consider even more aggressive brand promises.

The bottom line: Don’t try and wow customers, live up to your brand promises.

Employees Want To Make A Positive Impact

What motivates employees? This may seem like a difficult question to answer, but it’s not hard at all. There’s one overwhelming answer: Making a positive difference.

In our latest consumer benchmark study, we asked more than 5,000 full-time U.S. employees to select which of eight job characteristics they felt was the most important. Here’s what we found:

  • Making a positive impact: 42%
  • Earning a lot of money: 14%
  • Advancing your career: 13%
  • Building stronger skills: 12%
  • Using your judgment: 8%
  • Being seen as a top performer: 6%
  • Making friends at work: 3%
  • Impressing your family and friends: 2%

Making a positive impact is also the most important job characteristic across all age groups. As you can see below, it becomes increasingly more important as employees get older. For the youngest employees, being seen as a top performer comes in a close second place, but nothing is even close with older employees.

1811_JobImportanceByAge_v1

We also asked employees about the elements of their job that they enjoy. The chart below shows that once again, making a positive impact comes out on top across age groups and increases with age. For younger employees, building stronger skills is a very close second. As employees get older, using your judgement becomes an increasingly enjoyable element of their job.

1811_JobEnjoymentByAge_v1

The bottom line: Help employees feel like they’re making a positive impact.

What’s All This About X- And O-Data?

1811_XODataYou might have heard Qualtrics discussing X-data (experience data) and O-data (operational data), and wondered, should we care? The answer is yes, and here’s why.

Let’s start with a basic premise that no individual experience exists in a vacuum. People form their opinions about any experience based on a collection of different factors. The more we can understand those factors, the better we can extrapolate the insights about a single personal experience to form a deeper understanding about other people’s experiences.

Now to my discussion of Xs and Os, starting with customer experience (CX)…

Let’s say that your company has this data:

  • X-Data: NPS responses
  • O-Data: Customer product ownership and support history.

With X-data, you can calculate an NPS for the customers who responded. You can also dig into their feedback, and hopefully understand what’s causing promoters and what’s causing detractors.

That’s extremely valuable, but it only tells you what’s going on with the people who happened to respond to the survey.

By combining O-data with your X-data you can examine (especially through predictive analytics) what types of products and service interactions lead to promoters and detractors, and use this data to calculate the NPS for large portions of your customer base–—even for customers who never responded to a survey.

It could be that ownership of a certain version of a product tied together with a specific type of customer service problem is highly likely to create detractors. You can identify all the customers with that profile and take proactive measures to correct the issues — even though they may never have complained.

Result: More loyal customers and more targeted use of your resources.

This works across all areas, even with employee experience (EX). Let’s assume you have this data:

  • X-Data: Employee satisfaction study
  • O-Data: Employee tenure, promotion history, most recent performance rating

With X-data, you can determine how employees feel about their next steps at the company. You can also dig into their feedback, and hopefully understand what’s causing higher vs. lower levels of career satisfaction.

By combining O-data with your X-data you can examine what influence tenure, promotion history, and performance may have on satisfaction, and use this data to identify segments of employees to invite to participate in a high-potential development program.

Result: More high-performing workforce because you’re investing in the right employees.

Hopefully you can see how the combination of X- and O-data can increase your CX and EX insights. The same dynamic also holds true for brand experience (BX) and product experience (PX). By combining and analyzing the different types of data, you can use feedback from a few people to build an understanding of many, many more. This allows you to better prioritize investments, while making more targeted and impactful changes.

The bottom line: X- and O-data together provides an analytics goldmine.

CX Myth #4: Net Promoter Score Is The Best/Worst Metric

CX Myths: Debunking Misleading Beliefs About Customer Experience

Many common beliefs about customer experience are misguided, based on oversimplifications or a lack of consideration for real-world constraints. In this series of posts, we debunk these myths.


CX Myth #4: Net Promoter Score Is The Best/Worst Metric

What’s Wrong: People often argue that Net Promoter Score (NPS) is the greatest metric, while other people argue that it’s a terrible metric. Both of those points of view are off the mark.

What’s Right: We rarely see a company succeed or fail based on the specific metric that it choses. That doesn’t mean that you can chose a ridiculous metric, but most reasonable metrics provide the same potential for success (and failure). In many cases, NPS is a reasonable choice, as our data shows that it often correlates to customer loyalty. The way you use a metric is often far more important than the metric that you chose.

What You Should Do:

  • Pick a simple metric. It’s important that you choose a metric that employees will understand, so they are motivated to help improve it. The metric can be based on customer attitudes (like NPS), behaviors (like repeat purchases), or even results (like first call resolution). Just pick a simple metric that aligns with your business goals.
  • Follow our five steps. To drive improvements using the metric, follow Temkin Group’s five steps. to a strong CX metrics program: 1) Determine a core CX metric, 2) set achievable goals, 3) identify key drivers, 4) establish key driver metrics, and 5) make the suite of metrics actionable.
  • Focus on all four action loops. People often discuss an action loop with CX metrics, but we’ve identified four customer insight-driven action loopsImmediate responsecorrective actioncontinuous improvement, and strategic change. Any CX metrics program should put in places processes to close all four loops.
  • Don’t compensate too much. When companies establish CX metrics, they often establish compensation based on them. While this can be a valuable approach to raise awareness and alignment, it can also be a problem if the level of compensation is too large (can encourage bad behaviors), it focuses on individual results (CX is a team sport), or the goals are too precise (some metrics are inherently jittery).
  • Have very clear sampling strategy. The approach for sampling often has a very significant impact on results. If you have multiple segments of customers and they each have a different profile (as many do), then your overall scores can change wildly based on the mix of those customers that are included in your calculations.

The bottom line: Obsess about your metrics program, not your metric.