Aligning KPIs and customer experience goals: It CAN be done

July 10th, 2017 by Veronique Filip | Strategy

Customer experience (CX) is fast becoming the primary point of brand differentiation, replacing the established norms of product and price. Realising that fact, as many business leaders now do, is one thing. Acting on it is another thing altogether.

A common stumbling block to implementing CX improvements within an organisation is a misalignment between customer experience goals, employees’ key performance indicators (KPIs) and desired business outcomes. 

This can make it difficult, if not impossible, to gain organisational support for and get traction on improving CX.

This disconnect between grasping the importance of customer experience and implementing CX improvements is often driven by weak or outdated KPI design, with many organisations incentivising their employees to focus on product-related or sales goals. Even KPIs used to measure customer-facing employees are frequently misaligned with what customers are really looking for and are only inwardly focused.

Call centre metrics are a typical example. In the past, call centre agents’ productivity was looked at using KPIs that measured quantity, speed, time, service level, cost per contact, self-service rate, and technology. More recently, companies have implemented additional metrics which include first contact resolution, the speed of resolution, resolution rate, quality, level of service and self-service success, and repeat business. However, these KPIs are frequently assigned based on assumptions about customer needs rather than real insights and are not periodically reviewed (as customer expectations inflate over time).

Performing qualitative research (especially ethnographic or contextual) before designing a KPI framework or customer experience measurement programme has several benefits, one being that it enables a full understanding of what really matters to customers and an understanding of trigger points for the KPI (e.g. two minutes is too slow). This will help avoid falling into the trap of making assumptions about customers’ requirements, which can produce generic metrics that are not relevant to South African consumers—or even to your business or industry.

It’s essential to use customer insight to inform KPI structure, as the wrong KPIs can override training and good intentions, resulting in behaviours that are not customer-centric.

Another common challenge is in mobilising the business to invest in customer experience improvement. Customer experience metrics are often subjective (as the data is sourced from customer surveys and interviews), and they will usually relate to how a customer feels about an interaction. This can perpetuate a perception that customer experience is not tangible enough and make it difficult for decision makers to see the return on customer experience investment.

This hurdle can be overcome by using a measurement system that not only understands the outside-in view of customers, but also models how perceived interactions (customer experience) will really impact customer behaviours in terms of churn, cross sales and additional purchases.
Identifying correlations between customer experience metrics and revenue should be considered as a means for prioritising customer experience improvement. Additionally, a customer experience indicator needs to be operationalised to ensure that the entire organisation is united behind a common goal and incentivised to achieve this goal.

One of the strengths of the new Deloitte eXperience Index (DXi) is that it combines different levels of measurements, both qualitative and quantitative. In addition, data analytics and correlation to financial results ensure that the model stays relevant beyond common survey shortcomings like the inability of customers to predict their own behaviour. Finally, the operationalisation of the model is simple: it can work with any CEM (customer experience management) or VOC (voice of the customer) internal system for real-time tracking, and it will enable the design of more accurate customer KPIs.

When your balanced score card also includes real customer metrics, overarching business outcomes are linked to customers’ priorities and objectives. This means that your full organisation (including internal departments) should work more productively to impact client behaviours and thus the ability of your business to achieve sustainable growth.