Most organizations aren’t ready to deliver great Customer Experiences across all channels. Many of them have invested heavily in conventional methods of doing business, backed by in person or over-the-phone customer experience. This has led to creation of siloed operational structures within companies, where each silo operates individually.
With the advent of digital channels, these organizations set out to use and proffer their services via digital channels. They did this by creating discrete digital-product groups in their existing operational infrastructure. However, their siloed infrastructure falls short of meeting customers’ requirements in terms of seamless communication and interaction across all channels. The reason being:
- Customers’ utilization of multiple channels and touchpoints across Customer Journeys.
- Requirements of personalized services / products by the customers.
- Anticipation of impeccable coordination and communication by the customers no matter how they interact with the business.
This necessitates the businesses to not only provide great Customer Experiences at each channel, but also make the transitions across these channels simple to improve the overall Customer Experience (CX). However, improving the overall Customer Experience isn’t that simple a feat, especially with silo-based operational infrastructures. Providing consistent amazing Customer Experience warrants:
- Creation of a robust operational ecosystem through Transformation of internal operations, to respond quickly to customers’ expectations.
- Meticulous design and delivery of Customer Experiences.
Most organizations understand the significance of Transforming their Customer Experience—however, they lack the direction and support required to realize this goal. Organizational leadership can make use of the Customer Experience Pyramid to guide their CX Transformation.
The Customer Experience Pyramid is an empirical research based framework, which is quite effective in not only improving individual touchpoints but streamlining the entire Customer Journeys. The CX Pyramid entails 2 core dimensions:
- Focus Areas – the organizational spheres that must change to enable provision of amazing digital Customer Experiences.
- Strategic Building Blocks – the strategies that define how this change can take place and made part of the organizational processes to deliver exceptional Customer Experiences.
The 4 Focus Areas crucial in a business to change in order to deliver top-quality Digital Customer Experiences at scale are:
- Vision and Strategy
- Talent Management
Let’s discuss the first 2 individual Focus Areas of the CX Pyramid in detail for now.
Vision and Strategy
Redirecting focus on making Customer Experience a part of the Organizational DNA necessitates creating a Vision statement and Strategy to depict, clarify, and plan out the purpose and objectives of serving the customers. The senior leadership needs to come up with a short and crisp Vision statement. The Vision sets out the foundation that reflects the leadership’s focus, importance the organization gives to Customer Experience, and the high-level objectives associated with the provision of quality Customer Experiences.
Next, the leadership should work on developing strategies to build fundamental competencies within the 4 CX Building Blocks—i.e., CX operations, metrics, CX-centric culture, systems and governance protocols.
Once the Vision statement has been agreed upon, it’s time to work towards carrying out the required actions to produce customer-centric outcomes. The first step in that direction involves linking all employees who work in discrete silos (in conventional structures). To align all employees, there is a need to create a Transformation team and define new roles / CX groups. The Transformation team should train and direct teams responsible for the different stages of the Customer Journey, instill new ideas, and foster desired behaviors in them.
Senior Leadership need to also assign a CX Team to run the CX program. The CX Team has to lay out processes and yardsticks to foster cross-functional collaboration and coach functional units to adopt customer-centric design practices in their operations.
Interested in learning more about the other focus areas of the CX Pyramid Framework? You can download an editable PowerPoint presentation on Customer Experience Pyramid here on the Flevy documents marketplace.
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Strategy and execution are the 2 critical elements that drive a business. However, leaders often struggle even with defining—let alone devising and executing—an effective strategy. Many of those who are responsible to deal with it fall short of describing how they typically employ it. This failure takes its roots from the fact that there is no clear path associated with strategy.
Strategy is about making sound decisions about unforeseen problems. It’s about selecting the right options—about matters that are often quite ambiguous today but have great significance in the future—based on thorough contemplation, detailed analysis, and creative ideas. Broadly speaking, strategy encompasses these 3 main elements:
- A vision and direction
- A certain position or pattern
- A deliberated Strategic Plan to achieve strategic goals and vision
Great strategists execute their plans, analyze the results, evaluate their actions, and perform course correction based on the outcomes. They are not afraid of even revamping their approach entirely. Senior leaders should clarify their understanding of the concept of strategy and draw attention to the importance of differentiating between the 3 distinct types of strategies before formulating their own course of action:
- General Strategy
- Corporate Strategy
- Competitive Strategy
Let’s delve deeper into the 3 types of strategy.
General Strategy indicates how a specific objective will be achieved, with well-thought-out plans. The focus of this type of Strategy is on ends (objectives and results) and means (the resources we have to achieve the objectives). Strategy and tactics combined bridge the gap between ends and means; where Strategy deals with deploying the resources at our disposal while tactics govern their utilization. A pattern of decisions and actions marks progress from the starting point to achievement of objectives in General Strategy.
Senior executives need to deliberate on the following questions before devising their General Strategy:
- What do we do?
- Why are we here?
- What kind of business are we?
- What kind of business do we want to become?
- What is our purpose? What are the results we seek?
- What is our existing Strategy, is it explicit or tacit?
- What Strategy and plans may bring about the results we want?
- What resources we have at our disposal?
- Are there any constraints in terms of resources that limit our actions?
Corporate Strategy describes what a company does, the purpose of its existence, and what it aims to become. Corporate Strategy focuses on choices and commitments concerning the markets, business, and the organization. Corporate Strategy classifies the markets and the businesses in which a company will operate. This type of strategy is typically decided in the context of defining the company’s mission and vision.
A detailed assessment of the existing strategy, market, competition and environment is critical for devising the Corporate Strategy. Strategists indicate that there are critical elements that should be factored in while formulating Corporate Strategy. These elements include product or service offerings, resources, marketing and sales approaches, manufacturing capabilities / capacity, customers, distribution channels, technology, type of market and its requirements, and revenue and profit goals.
While formulating Corporate Strategy, senior executives should consider and seek answers to the following questions:
- What is our existing Corporate Strategy?
- Is our Corporate Strategy explicit or tacit?
- What are the critical assumptions that make our existing strategy viable?
- What is going on in the market—in terms of social, political, technical and financial environment?
- What do we seek to accomplish in terms of our growth, size, and profitability targets?
- What markets we are eyeing to compete in?
- What businesses we intend to operate in?
- What locations and geographies will we compete in?
Competitive or Business Strategy specifies for an enterprise the core reason on which it contests its rivals. It depends on an organization’s competences, advantages, and disadvantages compared to the market and the rivals.
Interested in learning more about the General, Corporate, and Competitive Strategies? You can download an editable PowerPoint on The 3 Distinctions of Strategy here on the Flevy documents marketplace.
Are you a Management Consultant?
Gordon Moore, Intel co-founder, observed that the number of transistors in a dense integrated circuit doubles about every two years. He projected that this rate of growth would continue for at least another decade.
His observation, termed the “Moore’s Law,” has correctly predicted the pace of innovation for several decades and guided strategic planning and research and development in the semiconductor industry. Moore’s law is based on observation and projection of historical trends.
In 2015, Gordon Moore foresaw that the rate of progress would reach saturation. In fact, semiconductor advancement has declined industry-wide since 2010, much lower than the pace predicted by Moore’s law. The doubling time and semi-conductor performance has changed, but it has not impacted the nature of the law much.
Although many people predict the demise of Moore’s law, exponential growth in computing power persists with the emergence of innovative technologies. Moore’s law is only part of the equation for effective Digital Transformation—there are other contributing factors including the role of leadership.
First Law of Digital Transformation
George Westerman—a senior lecturer at the MIT Sloan School of Management—proposes a new law, which states that, “Technology changes quickly, but organizations change much more slowly.” The law known as the “First Law of Digital Transformation” or “George’s Law” is a pretty straightforward observation, but is often ignored by the senior leadership. This is why Digital Transformation is considered more of a leadership—than technical—issue.
Just announcing an organization-wide Transformation program does not change the enterprise. According to George’s Law, successful Digital Transformation hinges on the abilities of senior leadership to effectively manage the so many contrasting mindsets of its workforce, identify and take care of the idiosyncrasies associated with these mindsets, interpret their desires, and focus attention on encouraging people to change.
Above all, the leadership should focus on converting Digital Transformation from a project to a critical capability. This can be done by shifting emphasis from making a limited investment to establishing a sustainable culture of Digital Innovation Factory that concentrates on 3 core elements:
- Provide People with a Clear and Compelling Vision
- Invest in Upgrading or Replacing Legacy Technology Infrastructure
- Change the Way the Organization Collaborates
Let’s now discuss the first 2 elements of the First Law of Digital Transformation.
Provide People with a Clear and Compelling Vision
Without a clear and compelling transformative vision, organizations cannot gather people to support the change agenda. People can be either change resisters, bystanders, or change enablers. However, most people typically tend to like maintaining the status quo, ignore change, or choose to openly or covertly engage in a battle against it.
For the employees to embrace change, leadership needs to make them understand what’s in it for them during the transition and the future organizational state. This necessitates the leaders to develop and share a compelling vision to help the people understand the rationale for change, make people visualize the positive outcomes they can achieve through Transformation, and what they can do to enable change. A compelling vision even urges the people to recommend methods to turn the vision into reality.
Invest in Upgrading or Replacing Legacy Technology Infrastructure
Problems and shortcomings in the legacy platforms is an important area to focus on during Digital Transformation. The legacy technology infrastructure, outdated systems, unorganized processes, and messy data are the main reasons for organizational lethargy. These issues hinder the availability of a unified view of the customer, implementing data analytics, and add to significant costs in the way of executing Digital Transformation.
Successful Digital Innovation necessitates the organizations to invest in streamlining the legacy systems and setting up new technology platforms that are able to enable digital and link the legacy systems. Fixing legacy platforms engenders leaner and faster business processes and helps in maintaining a steady momentum of Innovation.
Interested in learning more about the First Law of Digital Transformation? You can download an editable PowerPoint on First Law of Digital Transformation here on the Flevy documents marketplace.