The Future of Customer Experience is Agile

June 1st, 2022
IQbusiness - Gradient

The Future of Customer Experience is Agile

Introduction
Whilst the COVID-19 pandemic has presented its unfair share of challenges, it also enabled the expansion of markets, and organisations have had to adapt and & innovate to survive. The digital economy profited from the pandemic, with organisations having to migrate their operations online to protect their human capital, customers and to abide by legislation. Consequently, customer expectations have also significantly shifted because customers in the present era are spoilt for choice. Customers have an array of options to choose from, however they are most likely to spend their money on an organisation that gives them an exceptional customer experience and that treats them well. As a result of the growth in new strategies and technologies in the CX space, there is great opportunity for organisations to continue to capitalise on the emerging frontier of CX (Batra, n.d). This entrenches the need for organisation to reimagine customer experience as a capability, and to seek approaches to further refine it and develop it. Lean CX or CX Agility proposes a solution to this conundrum.

 

Lean CX & CX Agility – What is it?
Agile’s first principle highlights the importance of placing customer satisfaction as our highest priority, it is essential to consider what influences this. Oliver (1997) describes Customer Satisfaction as an emotional reaction resulting from any specific transaction. He specifically focused on the emotional impact of a transaction on a customer. Customer Satisfaction is a continuously evolving construct and as such a customer’s satisfaction with an organisation may change as they experience more interactions with said organisation. Customer expectations have a strong bearing on customer satisfaction. Customers expect to get the following service basics, as a minimum:

    • Customers expect organisations to do what they say they will do.
    • They expect organisations to get the fundamentals right and not just empty promises.
    • There is little evidence to prove that customers have extravagant or extreme expectations.
    • Organisations can maintain/improve their service reputation by consistently delivering what customers believe they are buying.

Roos (1990) first made the idea of lean production popular in his book The Machine that Changed the world. It describes how the idea of Lean CX can be traced all the way back to Henry Ford and his idea of flow production. Lean CX is essentially the strategy wherein an organisation creates the most value for their customers whilst using as few resources as possible.

Medinilla, (2012) spoke to five principles we can focus on that summarises the essence of Lean CX:

  • Understand and Maximise the Value you offer to your client
  • Identify and optimize your value stream for each product you offer
  • Make the product flow continuously
  • Introduce pull through each step
  • Pursue Perfection. This is achieved by constantly aiming to minimise the number of
  • steps, time and effort expended on each step in your process.

 

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The idea of CX agility is greatly believed to be an evolution of the idea of lean CX, specifically into the field of Software, Technology and product development. (Medinilla, 2012).
CX Agility is a concept which entails integrating Customer Experience (CX) with Agile management. In short, an agile approach to customer experience. Its purpose is simple, to enable an organisation to act on customer feedback swiftly and to refine a product or a service in a shorter time span (Beauchamp, 2021). It has a multiplier effect by allowing an organisation to develop the capability, further enhance an existing one, deliver refined products to markets faster, and including the customer in the co-creation phase. Integrating the two speaks to organisations delivering refined products, providing enhanced customer experience, and a competitive advantage at a swifter pace (CapFeather, 2021).

 

CX Agility – Centre of Excellence and Framework
CX Agility can be developed as a capability within an organisation, an additive to existing capabilities or it can be developed as a framework. Organisations that possess Agility and Customer Experience capabilities, can develop Lean Research Centres of Excellence within their organisations or Agility CX can assume the form of a framework to design and market-test products, or new services with the intention of refining the customer experience. CapFeather’s, CX Institute provides a framework for CX Agility.

The process entails a 4-step process:

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Source: CapFeather, The CX Institute, 2021.

 

The process is as follows:
Teams are prepared, briefed, and are aligned prior to the inception of the project.
Entails finding an adjacent market position for an organisation, which speaks to contextualising the organisation, its value proposition, its offerings to the market.
Developing a minimum viable product/service offering for market testing
Entails using the feedback from the market test to inform the scaling and refining of the product/service offering.
Whether an organisation chooses to apply a framework, or the Research Centre of Excellence model, the development of CX Agility as a capability will be crucial in the short-medium term. Organisations need to act on customer feedback, to improve their customer experience and CX Agility provides a swift answer to it.

As a Product Owner, your role would involve:

  • Taking accountability for the success of a product
  • Prioritising items on the product backlog
  • Maximising the value of the product

You are the key decision maker on what features and capabilities the final product will have. This means ensuring that the successful outcomes of both the customer and business are aligned and achieved in all aspects of the product implementation. And how do you define success for your customer? By understanding who the customer or user is, what needs they have, and then solving for the needs. All this, while meeting the objectives of the business. And this is where the challenge begins. Often, we experience a trade-off between customer and business needs – and too often, business wins. As Peter Drucker said way back in 1954: “There is only one valid purpose for a business, creating a customer.” It is simple – If we don’t meet the needs of our customers, we don’t have customers, and if we don’t have customers, we don’t have a business.

 

Yes, to CX, Yes to Agility, Why CX Agility?
As mentioned at the inception of the piece, COVID has had a myriad of changes in the dynamics in which organisations run. According to Forrester, customers reacted positively to new services that arose during the COVID era and subsequently customers would prefer for these services to remain in a post-pandemic context. Food retailers have had to reimagine their business strategies, specifically in relation to delivering products to clients, ensuring that they have the systems in place to facilitate the deliveries and a distribution channel in residential areas. Living in a post pandemic context, customers will want these services to form a part of the “new-normal context” (Forbes, 2021). This is one of the many shifts, that affected customers and organisations. If an organisation fails to keep up to speed with the shifts in the world, their customers, and the market, then they stand to lose their share in the market to an organisation with a high calibre customer experience. Research findings show that the ability of organisations to adapt to change by encouraging the development of employees who are agile, tends to have a significant impact on the development of business model innovation. This innovation is often exactly what is needed to support an organisation becoming more customer centric and delivering on their desired customer experience (Mihardjo et al, 2019).

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