Towards the New Normal
We asked Dutch-based design consultant Dennis Hambeukers to recap his SDN's Global Conference 2016 learnings in both written and visual form.
The knowledge that collaboration and synergy fuel success is a cornerstone of service design. As practitioners, we have developed or applied many methods to break down silos and encourage cross-disciplinary collaboration. We do this in service to the organisation, to keep everyone’s eyes on understanding the customer and their needs. It is ironic that the field of Customer Experience (CX), whose success depends on deep understanding of customers, has not been one of our closest partners, at least not until now.
CX is a strategic business value proposition. Improving the customer experience promises an increase in customer loyalty, brand reputation and revenues in the business of selling products and services. Improving experiences increases engagement, participation, behaviour change and compliance in education, healthcare or social services.
However, in many organizations and sectors, CX as a discipline and strategy falls short on some of its promises. From a ‘big picture’ view, CX as a function spends too much time measuring and not enough time designing. In this article, I suggest that the data gathering and analysis that forms the bulk of CX practices cannot deliver on necessary changes in customer experience without significant help from service design.
Service design’s human-centred approaches to problem definition, target state blueprinting, contextual data analysis, rapid prototyping and more will close the gap between CX’s data analytics and the quality experiences that will make a real difference, both to customers and to the bottom line. Service design is the means by which to deliver on the value of customer experience.
Changes in retail and service operations of the last 30–40 years led to the need for customer experience strategy. Technology and the opening of world labour markets led to a shift to highvolume production of goods. Customer turnover in some industries increased but, as long as the sales funnel stayed full, business stayed happy.
Customers, on the other hand, found themselves dealing with inferior or inconvenient products and services. They got lost in long, automated telephone queues. They suffered feelings of increasing anonymity in service encounters. The Internet boom of the early 2000’s increased customer frustrations as the interfaces between humans and technology became more numerous and more complex.
Entrepreneurial online businesses and the development of enterprise and cloud technologies that followed increased competition in every industry. Using social media, customers started talking. And with more choice, customers started walking. Business began to worry. CX as a strategy stepped into the spotlight.
Service design has developed during the last 15 years or so in response to the same increase in interfaces between humans and technology. Service design is a mindset and set of tools comprising a methodology for solving problems where the goals of people, technology, process and behaviour come together. The core value of service design is putting humans – their voices, their needs, deep empathy with their realities, and insights into their behaviours – into the design of services, products, organisations, interactions and, yes, experiences.
CX as a discipline and strategic approach gained both visibility and practitioners over the last 15 years, with faster movement over the past eight-to-ten years. CX is now visible in the C-suite of many large companies and a ‘commitment’ to improving customer experiences (and patient experiences, and student experiences, etc.) appears in many mission and strategy statements.
CX is a strategic perspective and value proposition that seeks to deliver customer retention and brand differentiation. Unfortunately, CX currently struggles with an identity crisis and a failure to fully deliver on its promise. As we will explore below, the penchant of customer experience leaders to focuson numbers and measurements without framing to actually design the necessary changes has created a gap that service design is ready to fill.
While CX leaders across industries agree on the goal of their efforts, i.e. ‘We need to improve customer experience in order to improve loyalty and revenue,’ there seems to be no agreement on crucial points to secure progress and success. Basic questions abound: how do we define ‘customer experience'?; who owns customer experience?; and just how do we actually improve it?
Disparities of definition exist across industries, within individual organisations and across the professional practice of CX itself. If business leaders and service designers are confused about exactly what CX is, it’s due to the fact that, within the discipline itself, there is very little that is unified or consistent.
For some organisations, CX walked through the door as a process improvement approach (or sometimes merely a new name) for customer service: the part of an organisation that customers encounter as they learn to use its products or when something goes wrong. This continues to be a very common approach as even more companies begin their CX journeys. Many CX jobs posted on LinkedIn in the US are actually customer service jobs with a new label. For example, Comcast's 2015 announcement that it was hiring 5000 CX specialists didn't mean hiring 5000 analysts, designers or ethnographers, but rather more service agents, call centre agents and installers who would now be called customer experience agents.
Historically, early customer experience efforts focused on improving customer service because, in many industries, it is the most visible interface with the company. It's not a bad place to start, but a number of companies stop there, and customer service is far from a finishing point.
Before many organisations are willing to establish an internal program for CX, they want to make sure they have measurements in place to determine the effectiveness of their efforts. The approaches to finding the right measure(s) have been many and varied.
Fred Reicheld’s work regarding customer loyalty led to the concept of the Net Promoter Score (NPS): a measure of customers' likelihood to recommend the company or its products and services to friends and family members. The value proposition behind the NPS is its promise to be the highest correlative indicator of customer loyalty and word-of-mouth recommendation.1
In theory, improvements in NPS will improve customer retention and net revenues. In practice, NPS strategy and implementation have been, for many companies, a confusing breakdown point. Where does NPS fit in the company? What does it actually mean? How does one use it to make actual improvements? Every business has a different response to each question, and most combinations leave CX programs that are struggling to demonstrate their promise.
A number of organisations approach CX as primarily a ‘listening’ post activity and equate it with Voice of the Customer (VOC). That is why, in many companies, marketing and VOC programs were the first to champion a concept of CX, seeing it as another way to measure customer satisfaction.
For these companies, the introduction of CX and NPS happened in relation to market evaluation and analysis. For some, this was as far as they got. The good news is that CX leaders are beginning to recognize the shortcomings of these current systems.
Frustrated CX leaders are looking for other approaches to link data insights to customer insights in order to execute on real innovation. Many CX programs have begun to use one particular service design technique: the journey map. It is the tool of choice for clarifying and examining pain points, and often leads to first attempts at co-design efforts (though most CX leaders don't choose the word ‘design’).
Too many times, journey mapping and first efforts at co-design don't get very far. A core reason for this shortfall is the tendency of business to work from the inside out: accepting perceived limitations and internal untouchable traditions as the starting point (rather than questioning them and re-evaluating reality). We also see resistance to new methods of problem-solving. Making real differences to the products, services and systems that create the customer experience requires intentional change. Despite protests to the contrary, few organisations really like change.
We are reaching a tipping point: CX leaders now see the gap between their measurements and the goals that they have set for themselves. Customer experience leaders grow more willing to consider alternatives.2
CX has made a few steps, but the gap to actually delivering improved experiences is still large. Service design offers the way to build on CX’s data insights with an expansive toolkit anchored in human-centred design principles. The result is a holistic approach with people-centred insights at the heart of solutions that leads to authentic innovation and improved experiences. This ultimately provides increased retention and revenues. Service design allows companies to ‘do the right thing’ both for their customers, for their employees and for their business.
Service design is a mindset, a methodology and a tool kit, but it is not an end in and of itself. Flexible and shapeshifting, it provides the pathway to improved design and greater longevity for organisations, products, services, interactions, and experiences.
CX practitioners have data and analysis and, sometimes, great statistical insights, but they struggle to identify actionable insights and then design products and services based upon those insights. As service design practitioners know, service design provides the framework for identifying insights, framing the design of solutions and leading collaborative design that delivers.
One particular challenge for service design practitioners is that most CX leaders are unaware of the disciplineof service design. As we've seen, they catch a glimpse of some of service design's tools in efforts at journey mapping or touchpoint mapping. But they have very little exposure to the overall practice and its promise.3
There is also the problem with the word ‘design’. The misunderstanding I've encountered most when trying to introduce aspects of human-centred design to problem definition or solutions design has been the assertion that design has no respect for business outcomes or revenues. Design is viewed as fluffy, and bringing in customers to participate in co-creation introduces too many wild cards to the process. Business doesn't like to lose control.4
Service design's first big opportunity to help is probably at the level of operationalisation. Bruce Temkin identifies six stages in an organisation's maturity of CX change.
While many organisations are, as we have seen, in the early stages (still measuring, measuring), the tipping point for service design occurs at the phases in which CX teams are asked to work with operations to produce results. This is the starting point (sometimes beginning with phase 3, but definitely with phase 4). More delightful, wicked design opportunities occur in the alignment and enculturation phases (phases 5 & 6).
Journey mapping could be a great entry point for service design practices into the customer experience framework, allowing service design practitioners to build trust and then share other tools and opportunities with CX teams.
Customer experience is based in interactions layered upon other interactions – including business mission, technology and manufacturing, delivery, on-boarding, implementation, customer service and engagement. Delivering branded, integrated customer experiences means finding solutions to many complex problems and orchestrating how those solutions work together.
Service design’s raison-d’être is to provide frameworks and tools to design solutions to complex problems. Service design maps the ideal state of interactions, cuts across silos and forces an integrated, humancentred, collaborative approach to solutions design. This approach will always provide the best possible solutions for customer experiences: solutions that the service design’s methodology itself aids in testing, evaluating and ranking.
Minimum table stakes5 for business and technology get higher every year. Customer experience will be the way companies continue to grow and flex with changing markets. Service design can help business build the necessary ecosystems and frameworks to keep a lively engagement with customers and their needs at the centre of strategy, operations and culture.
Customer experience is the value proposition. Service design is the approach and structural framework for success.
The service design toolkit is diverse, well-honed and looking for difficult problems to solve. Customer experience, as we have seen, has a wide gap between where it is (measurement and analysis) and where it needs to be (practical, results-producing change).
I have been on a journey with both customer experience and service design for the past 15 years. I have puzzled at the paucity of crossover, all the while, in my own practice, integrating service design as the methodology for delivering on customer experience. I urge you to do the same.
Long experience shows that service design is the discipline that bridges the data gathering and analysis of customer experience to design a holistic system that delivers true improvement to the customer experience.
Service design is not only a player and a partner, it is essential to the success of customer experience.
1 Reicheld, Fred, The Ultimate Question: Driving Good Profits and True Growth. Harvard Business School Press, 2006.
2 This point of realization has spurred the reach to customer journey mapping and fledgling efforts at co-design.
3 Notable exceptions are champions like Kerry Bodine who fluently speaks both languages and Bruce Temkin who, though he doesn't use the vocabulary of service design, talks of methods that parallel those of service design in his appeal that CX adopt 'people-centred design'.
4 For helpful insights on educating business and CX partners, read the excellent articles in Touchpoint Vol. 7 No. 3 – Selling Service Design, January 2016.
5 In poker and other gambling games, 'table stakes’ are a limit on the amount a player can win or lose in the play of a single hand. (Wikipedia)
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