Business leaders make investments based on the likelihood that said investment will be returned. Rarely does an executive pour money into a project whose outcome (return on investment) cannot be immediately quantified. Experts say this is a huge mistake on their part.
Customer experience expert Augie Ray talks about the tremendous importance of customer experience and how every company should prioritize this as much as possible. The key question tackled in his lecture:
‘What is the ROI of doing nothing?’
Companies like Uber and Nest are obsessed about bringing a different level of experience to people, which is why they’ve made countless headlines and they can consider themselves successful.
They made it big because they don’t just have a small team set in place to take care of the customer experience, but because the entire organization believes that they are accountable for it. To that end, Nest Labs caught the attention of Google last year. The search giant paid in excess of $3 billion to acquire the home automation company. Great CX is also what got Uber its multi-million-dollar funding in 2011.
Executives often want to know what the ROI of a customer experience program will be, but that’s the wrong question to ask. “The funny thing is nobody asks what’s the ROI of doing nothing,” says Ray. A general misconception is that everything surrounding customer experience is considered an “extra” and therefore the organization needs to be cautious about it. Nothing could be farther from the truth.
Business are like races: “Every moment of every day someone is trying to beat you. Unless you’re going to obsessively try to improve that customer experience, you’re going to fall behind,” according to the CX expert. The profitability is the outcome, but the goal is something else – pleasing customers. This actually echoes one of our recent blog entries: When Business Grows on Merit, Not Math.
Bad leaders are like bad parents
This insightful take on CX calls to mind parenting. Parents make the same mistakes when they focus on outcomes instead of the processes, according to pastor, blogger, and all-round family guy Kevin A. Thompson. Setting a curfew for your kids is easy because it produces a measurable outcome and one that has proved efficient. But it might not work in every household. Many times curfews lead to a deterioration of the relationship between parents and their offspring, mainly because Mom & Dad didn’t care about the child’s ‘experience’ when they imposed that deadline.
When it comes to children, the focus is indisputably in the long run. Which means parents (and business leaders alike) must ask themselves questions like “how did we get here?” (analyze what caused your kid to do something that deserved punishment), “who was involved? (if other people influenced that behavior), “where could we do better? / where did we go wrong?” (i.e. not the child), etc.
‘Seize opportunities for contributing to the greater good’
To end, I’ll leave you with this interesting passage by Roxana (Roxi) Bahar Hewertson, CEO of Highland Group Consulting, from a posting about things that great leaders do and failing ones don’t. It rounds up the above paragraphs perfectly, and it describes a business leader that’s focused on improving operations (not the company’s image) as a means of driving growth.
“Despite conventional thinking, great leaders have low ego needs because of their solid confidence and self-worth. By not wasting time and energy to shine up their image, this kind of leader frees up energy and time to create something greater than themselves, often building a legacy that contributes to something far more important than their personal agendas.”
To answer the question in the headline (How Much Does Great Customer Experience Really Cost?), CX isn’t something you do on a calculator. It costs as much as it takes to get done.