How to Measure Internal CX

Being an unusually warm Super Bowl Sunday, the citizens of the tiny town of Bentonville, Arkansas were out and about before the big game.

My daughters (9 and 11), always scheming for a way to score a buck or two, took advantage of the weather and downtown foot traffic to set up a lemonade stand. The venture took off immediately, requiring the youngest to produce more product and the oldest to eventually get more lemons.

While working together unusually well, I did hear grumblings from both sides on the inadequacy of their performances or the perceived in-balance of the workload. I generally try not to play referee but hearing from both sides I could understand their views. Afterall, you only see what you do not what others do.

Modern companies are not so different. We all have our ‘go-to’ person in some other part of the organization who gets it done and we all know that guy who never responds to emails. These underperforming areas exist due to lack of competency, tools, or resources. 

Under performing departments on internal CX are not only an inefficient organizational nuisance, they can also cost you customers. Long processing times, cumbersome and unnecessary red tape, and general unresponsiveness internally will also always be manifested in the front line not being able to serve their customers as effectively.

Wouldn’t your organization want to move away from internal performance hearsay and gossip as a method to gather this important information and get to a more disciplined and actionable approached? 

Measuring Internal Service Levels

Back in my days of working in organizational development (OD) we worked with a bank to conduct a survey of associates. While they had their normal employee engagement work, we also developed and fielded quarterly an inter-departmental survey. The results were then tabulated and sent back to each department as to how they did. It was also a point of discussion in business planning and used as a barometer of leadership competence. 

In the end it made everyone accountable for customer experience and was great way to bring it to the forefront of the culture. We made it very easy to complete and we did all the leg work in reporting. It also helped bring teams together in much the same way a hotel or other organization focuses on their external CX measure.

Interested? Here’s how we did it.

Step 1: Determine what matters in your culture

Each culture is a bit different in determine what makes for good customer experience. While various tools of yesterday year have been developed such as SERVPERF andSERVQUAL you really need to make it your own. You should try and have a standardized battery of no more than 5 questions in your survey. I generally recommend the following domains:

Easy to do business with – do other departments throw up roadblocks or is easy to get things done with them? Do they respond in a timely manner?

Domain Competence – do they have the skill set to do their job effective as a department and are they able to render internal services effective? Can they get done what they are supposed to getting done?

Empathy – do they treat me as an important customer and understand the needs from my point of view, or they focus on their viewpoint only in providing service?

Others may be things such as trust, value, quality, range of services, and relationship but if you ask something along the lines of three above you will get to core of what makes for a good customer experience in most internally. 

If you have to make it your own, so make sure these are dimensions are ones that everyone can live by. I usually recommend a series of short group discussions with different parts of the organization to get both the concepts and the proper language identified. It’s goal setting 101: if you are going to be held accountable to some kind of metric, it’s best to have buy in on what that metric is.

Step 2: Determine what the core deliverables are for your department

If you are in corporate accounting, you keep track of budgets. If you are in marketing, you help promote your company’s products and services. If you are in HR you are recruiting, selecting, onboarding and engaged in employee relations. You get the idea. Pick the big 3-5 deliverables for which your department is responsible and ask people to evaluate how you are doing.

You may also want to swap certain measures in and out as you experiment with new initiatives or services you are providing; or perhaps just how you are delivering. You want to maintain some continuity so you can figure out if you are improving or not, but there is some flexibility here to change and adapt to the changing needs of the department.

Step 3: Develop a Departmental Taxonomy

Not all departments interact with all other departments all the time, so it will be important to get a departmental list together. You will have some decisions to make. What level of specificity do you want to go to? Do you want to have corporate communications, digital, brand, product, and retail marketing all rolled up together or separated? The trades off are if you get too specific it becomes a vary burdensome survey for respondents. You go too high it becomes watered down. Generally, we find that units of 5 or more are a good rule of thumb to be a minimum and units larger than say 75-100 should be broken apart if possible.

Step 4: Decide if you want transactional or relational measures

In the CX world a transactional survey is exactly what it sounds like. It happens right after the interaction and asks specifically about that interaction. Relational studies, on the other hand, ask about things in general with the department. There is no one “best” approach, and in fact, in customer CX programs we often times do both, with the transactional informing the relational studies. 

How to decide? If most of your departments have a ‘beginning’ and ‘end’ point to an interaction or if they have a logical trigger, then transactional is going to be more actionable. Many times, that is not the case, and services are rendered on an on-going basis. In this case the relational approach might be better. If there are many small interactions, you may also want to go the relational approach to avoid everyone spending their days filling out surveys on one another.

Relational measures are generally done in waves. For example, in my banking example we did it quarterly. In the case of a transactional survey it down after the transaction; a completion of a report or project. The key here is making sure you are asking the right questions and not too often.

Step 5: Deploy

This is where you are going to need some technology. I would not recommend trying this with Google forms or freeware, you will get hopelessly entangled to the complexity of who to whom and customized content by area.

You will need a tool to conditionally display questions. Also, you need to do a sample load so you can tie back individual departmental responses and limit multiple responses from individuals. Paid versions of self-service platforms will fit the bill (AYTM, Qualtrics) if you want to do it yourself (like I said it can get complicated), or if you want to leave to the experts there are many out there (MaritzCX, Medallia, InMoment, Confirmit, Customerville, etc). Some platforms do both.

The general structure so be to ask about what departments with which individuals interacted. Then the general questions (from Step 2) and then the departmental specify question (from step3). You may wish to limit the number of departments they have to evaluate to ensure the survey doesn’t get too lengthy, but in many cases, you will find most people only interact with a handful of other departments, so this might not be a concern. You may also want to offer up a comment box where people can hand out praise or productive criticism.

Step 6: Analyze

Again, there are many great analytic platforms out there that can be used in the analysis of data. Typically, the best approach is through dashboards. Self-serve platforms have dashboards usually built in, or you can simply import it into Tableau or other data visualization platforms. The CX vendors all have dashboards pre-built with access level restriction built in to make it easy for you.

Step 7: Doing

This is the most important step. Taking the information and using it. This can be used as a rallying cry for the team to focus on a specific area. While there are many approaches to this, the formula that have seen work best is the following:

  1. Figure out what the right problem is to start with
  2. Determine what processes, resources, tools, and policies may be causing it
  3. Figure out who would be involve in solving it
  4. Get in a room with those people and brainstorm ideas
  5. Pick one, build an MVP, and test it
  6. If it worked great! If it didn’t was it 1) not the right problem 2) not the right solution, or 3) bad execution

Lemons into Lemonade

In the end my kids mopped up, even encouraging a neighborhood competitor to literally pitch their tent around the corner with a competitive offering (market intelligence reported the offering to be “too sour”). With only two of them it doesn’t really make sense to evaluate one another, but in much large organizational contexts where there are even low churn rates many people are leaving and joining the organizational daily. Getting a read on who is doing well and who is not doing well in delivering will help you understand both work flows as well areas for investment and coaching to improve their performance. This, in turn, will help your organization deliver a better experience to those who are paying the bills: your customers.

Making Hard Decisions in Hard Times

“We’re going home,” the President of the company said.

You could hear a flea fart in the room. We were 2 hours from going in to a major pitch with a Luxury Automotive client. There was literally millions of dollars on the line and we had spent weeks preparing. People flew in from all across the United States to participate and we were down to 11th hour…literally.

It was a sunny day in Los Angeles (as most are) and everyone was on their way to work. But this wasn’t a usual day.

You see, a plane had just flown into the some tall buildings in New York City, followed by another shortly thereafter. No one knew what was going on, but everyone was freaked out. The United States, was under attack from an unknown enemy with lethal intent.

As we were meeting they were grounding planes throughout the US. There were rumors of others that might be at risk. Was there one heading to Los Angeles? What else was going to happen? No one knew.

One guy did do the right thing. He made a moral decision on what was right and wrong,

“It’s not appropriate to pitch anything today” the President stated.

And with that he and about a half dozen other suits got in their car and drove back to St. Louis.

That man’s name was Tim Rogers and he was President of Maritz Research (now MaritzCX an InMoment Company).

What he did on that Autumn Tuesday in sunny Los Angeles made a lasting impression on me. Tim was able to rise above the buzz and business imperative of his own company and make the right call under high pressure…even if it meant him potentially losing millions of dollars.

Now we have another unknown enemy we are confronting. In the days and weeks to come, we don’t know what the future is and once again, most of America and the world is seriously freaked out.

There are many articles about the greedy and altruistic behaviors of corporations toward their employees and customers. I do think people will remember what people do in this time of crisis. They will vote with their wallets and their loyalty in the months that follow. So making the right decision is very very important in the upcoming days.

Unfortunately, the right decision is not always apparent. While you will not always know what that decision is, one hint is that it will be the one that is the hardest to make.

I often think of that day with Tim and what he did. I can’t remember if we won or lost that pitch or if it ever happened. What I do remember is admiring his ballsyness and leadership. Clients sensed it too, and counted on him to do the right thing.

The days ahead are when heroes are forged and villains are unveiled. COVID-19 will pass and humanity will emerge hopefully stronger and a bit more humble. What everyone will remember and judge, is if we, as leaders and humans, made the right decisions or the easy ones.

Here’s to good decision making in the days ahead.

CX Sh*t’s Gettin’ Real…

What the recent InMoment/MaritzCX merger means and what the future holds

Just a few days after it was announced that Confirmit and Dapresy joined forces, today venerable CX solution provider MaritzCX merged with Utah based InMoment. This has in essence created one of the largest, if not THE largest in terms of market share and revenue EFM provider in the space.

It’s no secret I am familiar with both of these firms, having worked in various positions with Maritz for over 13 years (including CMO) and partnered with InMoment in the years after my departure.

The MCX/InMoment merger is a bit different than others in that, to some extent, it is a merger of equals. Both with strengths and weakness in their own right, but in my estimation two culturally compatible entities with an industry foot print that is big-foot wide.

Having been around the CX block , I can tell you they make for a formidable competitor to the more recent disruptors Qualtrics and Medallia, not withstanding the excellent soirées they hold.

Are we done with EFM consolidation? I don’t think so, but we are getting close. The big players hailing from a call center heritage are Verint and NICE. Both also have been on a buying spree with Verint mopping up Vovici in 2011, then Opinionlab in 2017 and finally Foresee in 2018. NICE decided to swoop up NPS banner holder Satmetrix in 2018 too.

A few years back MCX itself merged with Allegiance and Empathica and Mindshare merge to form InMoment.

This was all done in a race to complete a successful “solution stack” in this space. EFMs are like Mexican food; it’s essentially the same ingredients combined differently. The first who can offer the best tasting, cheapest meal with the most variation wins.

That full product stack includes: dashboards, data processing (ability to crunch big numbers fast), cross platform connectivity (APIs), text analytics, social media harvesting, predictive analytics, data capture (fancy survey builders), installation services, and expert services.

All the current big players have built (Medallia), borrowed (Customerville & Clarabridge), or bought (Dapresy & Confirmit, Qualtrics & Temkin) their way to ‘full stack status’. We now have really cool state of the art locomotives. I mean these things are huge, powerful, and reliable. But they are locomotives.

In my opinion these waters are more red than an Arkansas Razorback football game and if we are honest with one another, they have been for quite a few years now. So what’s next?

Here’s what I think.

Qualtrics Provides Some Clues

First, we can certainly see in the tea leaves when SAP spent the equivalent of the GDP of Burundi on the acquisition of Qualtrics. I remember a friend of mine coming back from one their extravagant conferences and asking me “Dave, I don’t get it…they are just doing surveys right?” Surveys indeed. You would think they have created an anti-matter powered jet pack…but no. At the end of the day it is the same Mexican food, but presented really nice; buy something-get a survey-fill out a survey- report on the survey. That is the basic use case and has been for 50 years.

What’s different about the Qualtrics acquisition (other than sparking my fascination with tinted eye glasses) is that SAP has a pretty fancy CRM platform. Connecting EFM and CRM…wouldn’t that be cool. I’ve been talking about it for at least a decade, and it seems to be coming to fruition. That is part one of how to get us out of this Mexican Food Rut (although I do very much like Mexican food). CRM can help do more than prevent churn or send a carton of Bon Bons to a disgruntled hotel guest..it CAN MAKE MONEY. It’s not only about cost avoidance any more, it’s about revenue generation too.

Channel Changes

Email is dead. So much so, that I know some insight suppliers that are turning back to mail surveys to get opinions. The good news is that the fundamentals are still there; most people are inherently narcissists. They like talking about themselves and they like other people reading about their opinions. This is good.

Businesses are more thirsty than ever for the voice of the customer. They want to get smarter so they can win. Even stodgy old price leaders have pretty much come around to this realization. Customer has and always will be king. This is also very good.

What’s bad for us in ‘the biz’ is a majority of Americans have a fake email address for their ‘junk’ email and others use temp email approaches to get a gated contact, email is not a good way to do much of anything nowadays. If you get past that hurtle you have spam filters and even still…seriously? filling out a survey? The next CX conference or bar-mitzvah you go to get a show of hands from the crowd of how many people actually fill out surveys.

Unlocking how to get in contact with folks who want to be heard and giving them incentives to do so will be the key. SMS and Social Media channels show some promise, but I think it is much bigger than that.

Look to the Past to Find the Future

The largest prize to unlock is a very old one but still the most powerful. In the 1940s there was this fellow by the name of Kurt Lewin who said “hey what if we ask a bunch of people what they thought, took that information and made some educated guesses about what to do, and we just well…did it?” Thus the field of Organizational Development was born.

Companies who realize that technology alone will never make a difference and that it is really all about organizational change will win the day.

Having great golf clubs does’t make you a better golfer. Commitment and practice does. This requires a whole different set of skills that no one in the EFM space currently possesses in adequate quantities (well, I do know this one little firm in Bentonville…).

By change, I am not talking about making sure Dora got her large fries or that you were able to up-sell a cable package to an AARP customer. I mean meaningful structural change. This is very rare to witness in the current state of affairs; bringing together marketing and ops to provide one holistic experience.

To achieve enduring positive change involves working directly with organizations to help them implement change and helping them create the right culture, tools, processes, policies, products, and tools to make meaningful and permanent cross organizational change. It’s a hands-on very intimate approach that is akin to an agency relationship to an organization.

You cannot change your customer experience by correcting mistakes or cramming more stuff down their throats. Changing CX starts from within. Companies changes for the better or worse through the people who work there. The CX provider who figures out how to do this best…will win.

And for my friends at MCX and InMoment, I sincerely wish you the best on this new exciting page in CX history.

The Secret to Unlocking CX: Segmentation

“A FOUR, A F*CKING FOUR!???” I yelled at my smart phone.

I stared at the number in disbelief.

I looked at my wife who shrugged.

It was our first non-perfect score (4 out of 5) at our Airbnb and I was incensed. It got worse on the other ratings but thank god that only the overall was publicly displayed.

I took a breath and started reading. It had complaints about no live TV (we use only streaming in our Airbnb), the couch was uncomfortable, a lack of ‘grab bars’ in the shower, and ‘pricey’. I took a breath and then looked at the picture of our guest and then it struck me.

This isn’t our usual customer.

Our customers tend to be 30-50 somethings who are traveling to Northwest Arkansas to mountain bike or for business meetings. They tend to be affluent, active, and tech-savvy. Their priorities are ease of check in and check out, quiet, good parking, distance to city center and Northwest Arkansas’s trail system. We’ve had close to 100 guests so far and only perfect scores.

This customer who dared to give us a 4 out of 5 was 60 something older women from a neighboring town in Arkansas. She doesn’t watch Hulu, doesn’t mountain bike, and is apparently not too steady on her feet. What she does want is a comfortable couch, a low price, and the ability to watch American Ninja Warrior on live TV.

It was a mismatch thus our ‘low’ score.

This happens all the time. This is also why many syndicated studies that publish ‘lists’ are of limited value. If you served a meat lovers pizza to a vegan, of course you are going to get low marks. Young people want different things than older people. Families have different needs than singles. Mountain bikers want different amenities than pinocle players.

The Danger of Hiding Behind Averages

An old market research research joke goes… “on average, humans have one breast and one testicle”

This of course is true in the aggregate, but I wouldn’t call it an accurate depiction of human beings. To understand customers, we can’t view them a uni-dimensional, we have to understand individual differences and provide services accordingly. We also need to measure the experience in this way.

Unfortunately, the CX world has largely ignored this and favor of monolithic NPS and other “indices”. Using indices to mindlessly benchmark yourself to others is misguided. My favorite example of this come from the intrepid mystery shoppers at Pied Piper with their ‘Prospect Satisfaction Index’. In this study of auto dealers, they found that Tesla ranked dead that purported to report on which brands were ‘most helpful’ in shopping to customers. 

Here’s the problem, most dealerships jump on customers like they are the last slice of pizza after a Phish concert. This PSI index measures such things such as if the sale person asked about the customer about visiting the dealer website or if the salesperson had to get ‘best price’ from management. Things that can frankly annoy some customers but can help sell cars. But…that’s not Tesla’s model. They simply let the customer shop and answer questions if they have any. 

Tesla took the news of their last-place position in stride….

Segmenting Your Customers

So how do you go about parsing your customers (and non-customers) into categories. What the CX world needs to adopt is a technique used in traditional marketing research since the 1950s: Market Segmentation. Let’s do a quote shall we?

Market Segmentation involves viewing a heterogeneous market as a number of smaller homogeneous markets, in response to differing preferences, attributable to the desires of consumers for more precise satisfaction of their varying wants” (Smith, 1956)

I think we can all agree if we could customize an experience on an individual level that would be ideal, but it is usually not practical, so we split the difference and focus on (fairly) homogeneous groups. We can then adjust both the experience for each group accordingly. Here’s how you do it.

Step 1: Understand Your Customers

Let’s pretend that instead of two houses, the Trailhouse brand (our Airbnb) had 100 locations. Let’s also say we regularly collected customer experience data. We first might conduct a brief study among past guests and find out a few things; why did they visit, what things are important to them about staying in an Airbnb for that stay, and how was their experience, and some profiling variables (age, gender, family etc.).

If you owned your own booking platform (we don’t) you could capture the reason for the trip at the time of booking. You could capture their overall experience upon check out. This leaves you to gather up things important to them about their stay either at check out or at a later time. Many booking platforms require a ‘profile’ which is another place to gather up this one-time information. With this data in hand, you can move on to segmenting your customers.

Step 2: Segment Your Customers

There are many methods to segment your customers. Segmentation masters Michel Wedel and Wagner Kamakura provide a great framework in their aptly entitled book “Market Segmentation”. In segmentation, you have two things to consider; your ‘base’ or what you going to segment on, and how you plan to classify folks. Your base choices vary on observable/no observable and general vs. specific.

In our case we would probably want to focus on “unobservable” and “specific”; aspects of their stay that are important to them. We would also want to pick some profiling variables that could be used as surrogates for our base. That way we don’t haves to re-ask questions on an on-going basis.

As far as classification approach we have a variety of methods to choose from based on the nature of the data and the technique. In our example we would probably want to understand what is driving certain customers to like or dislike the Trailhouse experience. To predict drivers and cluster groups simultaneously we would use Clusterwise Regression or Latent Class Analysis

Here’s what the output might look like.

In the rows have the attributes and, in the columns, we have data-derived clusters. First, we see are largest segment are “Outdoor Actives” followed by “Active Family”. We also have some business users, and finally Value Minded Pensioners. The clusters were derived from the data (the base variables). 

We can see they have very different priorities and preferences with the darker shades of blue being more important and lighter shades less important. For example, business traveler strongly values flexible booking and cancelations while young families need more space. We can also see most folks like the Trailhouse with some weakness amongst Value Minder Pensioners.

Step 3: Apply the Algorithm to Your CX Tracker

Where possible, I advocate very short surveys, especially in transactional programs. These are the surveys you get in-app after your Uber ride or after calling the call center via SMS text. In this circumstance, we could perhaps ask two questions via text or email (or in-app if there is one).

  1. What was the reason for your trip? (select that all apply)
  2. How was your overall experience?

We might also ask if there is a need for a follow-up and comment box. We now can use the reason for their trip as a proxy (statistically derived) for their segment. This could also be achieved by asking a subset of questions and using modeling to predict their segment. Now you are not looking at all your customers the same. Your dashboard could look like this.

We can see that we rock it with business customers, but they are a smaller part of our business (25%). We don’t do too well with value-minded pensioner, but they are a smaller share of guests, and they are not on target, so we probably don’t want to be something we are not, and our best bet is to steer these folks to another property.

Step 4: Make Changes to Your Experience

This is the most important part of the process; using the data to make strategic and tactical changes and then observing what, if any impact, it had on the experience and business outcomes. 

For example, if we looked at this in January, we might be concerned about our Outdoor Active Singles. Perhaps we mined the comments and found that lack of storage for bicycles was an issue in some locations and decided to install smaller bike lockers on-site in those locations. 

Now we can see the result of our investment. In March things start picking up for this younger outdoor group. In this way, you could separate your target customers from your non-target and also developed segment-specific tweaks to their experience and observe it made a difference.

Making Data Work for You

I always tell my daughters to keep their eyes on their own paper when comes to grades. I think the same advice is worthy to follow in CX measurement. While it is good to know where the competition is at and if possible, learn from them, ultimately you need to focus on delivering on your value proposition for your customers.

Developing and implementing a segment based CX system will help you do just that. The good news this isn’t new. Marketing and product development folks have been doing this for decades to very good results. It’s time to move away from the monolithic one score one customer mindset and look at customer differences as they relate to the experience you are delivering.

2,000 Customers’ Hopes and Fears from 2019

By my reckoning I had the privilege to talk with over 2,000 complete strangers this year. 

I talked with Wanda, a furloughed federal employee in Washington D.C. who couldn’t afford to buy a new furnace in the cold of January. I talked with Doug a former C.E.O. of a defense contracting firm in Dallas who sheepishly admitted that he likes to drive really fast. I talked with Billy a self-taught artist from Tupelo, Mississippi who is also a community organizer.

I spent time with a soft spoken and inspirational architect who dedicated his life to create better communities. I talked with an off-road enthusiast whose hobby was to swim with sharks…without a cage. I chatted with young entrepreneur from Southern Italy whose father sold his grocery stores to return to farm the land of his father and grandfather.

An elderly affluent Persian-American in Palo Alto shared his admiration for the craftsmanship of the stitching in the seats of his car. I had casual chat with a Turkish taxi driver in Hamburg who nearly got us all killed because of my incessant questions. A debt free handyman who lives on 900 on acres in the Ozarks took time to share his insights on technology.

We chatted in groups, on the phone, through video conference, in cars, in parks, at work, on farms, in garages, on trains, and in folks’ homes. I had conversations in 28 states, 8 countries, and at all times of the day and night.

Beyond finding out why people do what they as part of my job at Curiosity, I also started uncovering some trends that transcended my formal assignment. I thought I might try to fit those puzzle pieces together and share them here.

The Destroyer of Worlds?

In my conversations about why people buy this or go there, people oftentimes express an underlying yearning to connect. We have moved away from each other some say. The country is divided they say. There is a sense of profound existential loneliness amongst many.

Many point to social media as the malicious gremlin mucking things up. My stranger-friends through the year pointed out that everyone seems to be staring at their phones rather than talking to one another at the dinner table… that is, if they have dinner at the dinner table at all.

In fact, people are very social in social media. Facebook, Instagram, and yes LinkedIn have done a terrific job of compelling you to compulsively check your account, making it as much a part of your daily routine as brushing your teeth or chasing the neighbor’s cat off your lawn.

But these tools that were created to help connect the world has had the Oppenheimeresque side effect of further metastasizing already galvanized world views into tighter and tighter non-communicating groups. Whether it’s politics, religion, healthcare or sports teams we are moving into tighter and tighter idiosyncratic tribes, turbo charged by the innate psychological principles that compel us with evolutionary zeal to prefer familiar others in the first place. 

We get so far from the other side that we can’t even fathom how they got their world view in the first place, let alone empathize with them. Many us throw up our hands and close the door rather than open it for those who think too differently from ourselves.

The Prisons We Create

It is not just social media and technology that are driving forces; we have literally built our own prisons of isolation. Since the 1950s Americans have retreated from their churches, their social clubs, their close-knit rural communities, and even their families to join planned sprawling developments where they can roll out of their closed garages and commute to their jobs in the isolation of their own private vehicles. House sizes have tripled in 50 years all the while fewer people live in them.

Local shops in sleepy town squares were replaced by super stores and outlet malls far from where people lived in the 1960s through the 80s. Once upon a time you visited a family doctor at his own small office, and you knew each other by name. Now you take a number and get in line for the first person available. 

From the end of World War II, we have moved from small communal nomadic tribes to one enormous isolated and sterile body politic that is aching for the hammer to be thrown through the movie screen.

A Change is Gonna Come…

The hammer has been thrown in my opinion. We are at an inflection point. The folks I talked with seem to want to return to community. People want to know their neighbors. They want to be a part of a greater sense purpose, beyond generating wealth and buying material possessions. 

For the first time the average home size has started to shrink in size. People are spending more on experiences than they are on things with people preferring to use things as they need them rather than owning everything. 

The large mega mall is dead with small businesses flourishing and driving an economic expansion. An increased appreciation and nurturing of nature as grown from a side bet to the only bet. The citizens of Ethiopia planted more trees in an hour than there are residents in the United States. A return to craft at scale is well underway, and I for one am grateful that…especially the beer.

Everyday People

Walking away from a year of talking with folks I am also left with few other conclusions. First, I must agree with Luke Bryan; people are basically good. That’s a weird thing to say from a psychologist who shouldn’t make sweeping value-laden generalizations, but I found it to be largely true. 

Most folks were just trying to live their lives in the best way they could. They want the best for their families, and others and generally not understanding why others did not act accordingly They want happiness. I’m sure we have encountered our share of jerks in our professional and personal lives, thankful their share of humanity seems rather low based on my travels.

Smarter than you think

The second thing is that people are generally quite bright. Most of my stranger-friends were quite thoughtful and rational in how they arrived at their conclusions. However, the rationality was bounded by facts that, on occasion, were of dubious quality. Nonetheless, I was pleasantly surprised, and greatly humbled by how much people think about their decisions and views. Much has been made of the sophistication of modern consumers. I think most companies have woefully underestimated our humanity’s intellect.

Bounded Rationality

The last thing I will leave you with is that sometimes people have no idea how or why they make the decisions that they do. As researchers who like cause and effect relationships this can be frustrating. People stick with shitty services and will pay a premium for nonsensical features they never use. The point is; no one thinks about your products and services as much as you do. As practitioners in this space we have be a bit less narcissistic about how our do-da or widget fits in with their life. Most of the time, you are just not that important.

The Future

So, there you have it. We are a species who wants to be together but have built tools that thwart the fulfillment of that need. Technology and where we created to live are the 21st century Promethean gift they we must adjust, dismiss, or destroy if we are ever to come together.

While the divisiveness across the Western world concerns me for the sake of humankind, I do take some solace and seeing the seeds of change beginning to germinate. There will be a time perhaps when people of different beliefs and world-views can at least have a conversation….there is no need to agree. I think George Orwell said it best…

“Our culture has accepted two huge lies. The first one is that if you disagree with someone’s lifestyle, you must fear them or hate them. The second is that to love someone means you agree with everything they believe or do. Both are nonsense. You don’t have to compromise convictions to be compassionate.” – George Orwell

As for me, I look for to speaking with thousands of more in 2020 and beyond and practice both conviction and compassion. Happy New Year.

The 4th Annual Global Mobility Study

Check out our 4th installment of the Global Mobility Study with our international set of presenters; James Carter of Vision Mobility, Becrom Basu of L.E.K. Consulting, Rahima Yakoob of HHL Leipzig Graduate School of Management, and Neha Katdare of the Broad School of Management at Michigan State University. Come find out what’s going on in 9 different countries with new forms of mobility from e-scooters to autonomous vehicles. The deck can be found below or you can just watch the webinar broadcast December 5th below…

The Final Journey: CX and the Death of my Dad

My dad passed away last January. A lifelong insurance man, Roger was well organized, well-liked, and, I think, a well-respected community member. He was a tenacious fellow who, when confronted with even the bleakest scenario, always managed to claw his way out. This time he couldn’t muster that final climb and, while it is never easy to lose a loved one, at 78, he’d had a pretty good run.

You never really think about this aspect of life until you are faced with it. After the funeral and friends disperse, you are left with the reality that Dad is no longer here. However, what you might not expect is the twisted bureaucratic latticework left in the wake of their passing.

Dad was a very organized person. Everything had its place and nothing made him happier than a well-filed cabinet or an organized dishwasher. A dedicated jig-saw puzzle fan, he left a number of difficult mysteries behind for us to piece together. There were usernames, passwords, accounts, and agreements… to which we had no access. Passwords and accounts were scribbled and crossed-out a dozen times on an old yellowed index card he had used to keep track of his accounts. Gaining access was difficult, but that was only the beginning.

In working through all of this, what was surprising to learn was the wide range of preparedness, or lack thereof, of companies in dealing with this relatively common situation. Some were good, most were bad, and some were horrendous, but let’s start with the good.

The Good

Dad passed away in the middle of a large research project I had. While driving down from Boston to my hometown in Pennsylvania, I had to start switching airline flights, car rentals, and lodging to accommodate this new sad curve ball life threw at me.

Driving down I-84, ever watchful of my speed and the state troopers, I dialed up Delta Airlines. I was eventually connected with an older call representative with a rich baritone voice and the clipped articulation of a military officer. I was reminded of Lt. Richard “Dick” Winters of the 101st Airborne from Band of Brothers fame.

The real retired (and deceased) Major Richard 'Dick' Winters
The real Lt. Winters of the 101st Airborne

“How can I help you today sir?” asked Lt. Winters.

“Well I need to change my airline flight and I am hoping you can help me… because I know this is last minute … but my Dad recently passed away and … and …”

Right there I totally lost my composure and got a bit choked up. I don’t know why. I think it was just reality setting in.

Sensing my discomfort, Lt. Winters cut in. “I am very sorry to hear about your loss Dr. Fish, I lost my father a while back, so I know how you are feeling. We will get you taken care of…”

It wasn’t a fake empathy. This guy meant it.

He went about changing my flights, waving whatever charges he could, and wished me the best with a verbal man-hug. I am fairly confident he bent more than a few rules on my behalf. He was a brief warm light in the cold January sky on that lonely highway.

CX Tip #1: Be Like Lt. Winters

It wasn’t a process really; it was his sincere willingness to help a vulnerable stranger in a tough spot. The lesson here is that your everyday representatives, waiters, checkers, tellers, and salespeople will all run into tough life situations that their customers are going through. While I’m not sure you can train for that, you can prepare them. You can also hire good caring people-centric people. That’s the basic ingredient to CX even in the darkest hours. I will always remember the kindness of Delta’s Lt. Winters.

The Bad

Financial security is one of the first things people start to worry about when a spouse of 50+ years leaves this planet. In the case of my mother, this was no exception. While she is all set now, the uncertainty of the moment added stress to an already overwhelming experience. The key to reducing this anxiety for your customers is to remove that uncertainty as quickly as possible. Unfortunately, that is not what had happened.

My Dad was insurance man for 40+ years, as his dad before him. He had a number of policies with his own company which he touted his entire his life as being ‘the best’. One would think that, if any organization would have a good process for the death of their customers, it would be an insurance company; particularly when the insured was an employee. Unfortunately, one would be very wrong in this case.

In trying to get answers as to what policies he did and did not have, we were moved around from department to department to get a straight answer over many weeks. While we were doing that, the local agent (or someone) had informed the parent company that my father had passed away. In response, they promptly stopped payment. No warning, no letter, no nothing…just no direct deposit. They just cut off my 78-year-old mother’s income completely.

Several months later, after we had procured the right documents and contacted the right people in the right departments, and after several three-year-old type meltdowns I had with their reps, we finally got it resolved. What they did right was to escalate this issue until I finally got to talk to a human being who could do something about it. What they didn’t do right is have any process for the death of an employee in this situation…in this case, their own salesman.

CX Tip#2: Communicate with those Alive

Journey map the situation that happens to millions of families every single year. Your customers will literally die. Figure out what you are going to do about it and make it easy for the survivors. Have a consistent process, a consistent communication approach, and keep people informed. My father’s company had either not done this homework or failed to execute it. Also, remember that communication in a crisis situation is critical. It doesn’t change anything, but at least it gives perceived control to your customers, which is a welcome port in that sorrowful storm.

The Reprehensible

My mother has a car…which was registered in my father’s name. In retrospect, this was a catastrophic mistake. It turns out that the captive finance company responsible for the lease were not at all prepared to deal with the very common process of changing ownership from a spouse who has died.

While I won’t bore you with the details of our 3+ month adventure in trying to get this simple task accomplished, some of the highlights include:

  • Dealership personnel knowingly misinforming my mother of a procedure because it was “complicated”
  • Call center personnel not knowledgeable of their own policies or reasons for those policies
  • Lack of follow up, issue tracking, and case management
  • Being passed around from department to department
  • Losing important, confidential documents (like my father’s death certificate – twice!)
  • Sending physical documents to the wrong location after the address was updated
  • Losing faxes transmitted minutes beforehand
  • Only being able to communicate via inbound phone or fax (no email, no direct numbers)
  • Making it necessary to hold a séance to get the password for his online account

It wasn’t until I escalated this issue in a Twitter rant that I finally was contacted by someone from their executive offices to help. She was excellent; she helped and did so with professionalism. Having my mother’s credit app finally approved, she wished me well, as all that was left was to pay a $75 transfer fee. Unfortunately, as of this writing, this issue is still not resolved, as they could only take a physical check mailed to their location. Fingers crossed!

 switch board lady

This company lacks the tools, policies, training and the processes to handle a fairly common situation effectively. This could almost be excusable if it wasn’t for one other important element: empathy.

With the exception of the specialist from the executive office, the default position was that I was the cause of the issue. I had entered the wrong policy number. I had mailed it to the wrong place. I had not followed their procedure. I did not understand their policies.

Worse, when I explained my situation for the 20th time, almost every call representative would say “I’m sorry for your loss” in the same way a fast-food employee might say “you want to super-size that?” I am not expecting a moment of silence or psychotherapy. Perhaps just the common courtesy of giving a rat’s ass.

CX Tip #3: The Right People, The Right Team, The Right Plan

First, hire the right people, develop the right process, train them, and ensure they have the right tools to do their jobs. Second, in crisis situations, have a dedicated team to deal with these issues. It is in the best interest of everyone to resolve these situations quickly.

Finally, do not train your customers to use social media as their last resort. I was happy I got attention, but this “squeakiest-wheel” approach is not only dissatisfying to the customer (why did it have to come to public shaming?), but most likely also hugely disruptive to the company. What could have been resolved in one letter or phone call for a few dollars, took 20+ contacts and what I assume was a great expense for the company.

Also, I have been kind and haven’t revealed the company in this article, but I can assure you it isn’t the first time I have related this experience and have not afforded the same courtesy in its telling. Do it right the first time.

The “One” Thing: Empathy

The real differentiator in all of this is what matters in any job: giving a shit. Call it commitment or engagement or whatever, but if your employees don’t care about what they do and don’t care about their customers, you will suffer the consequences in high servicing costs, high acquisition costs, high turnover, and high customer churn.

Don’t overlook those less frequent but highly emotional times in your processes and procedures. In these cases, your company will either shine or fall precipitously from grace, never to recover.

As for my Dad we all miss him, but life moves on. I think he might have liked it that I wrote an article about how to persevere, correct processes, and advocate for human empathy; virtues that he both loved and lived. Perhaps a small tribute to a great guy. See ya, Dad.

Photo by Dave Fish

The Romance of Story Telling

For Sale:

Baby Shoes,

Never Worn

So goes the alleged shortest story ever written. It is poignant and mercilessly economical; a hallmark of Hemingway’s writing style. Writing is a tricky business, one I have grown to appreciate.  So what makes for a good story?

It depends who you ask.

Recently, I attempted something different in a presentation. Rather than blurting out the main point in the first two sentences as is customary, I attempted to lure the reader into a narrative web instead.

“You buried the lead!” was the reaction of one of my respected colleagues. Bury the lead you say? Hmmm.  That got me thinking; perhaps story telling is more of a romance then a smack in the face. So I persevered and tried subtlety for a change.

This was not my first literary experiment.  When I first entered the business world I had to undo a decade of academic writing habits. In academic writing you are trained to be objective. The writer is to be invisible so the evidence can speak for itself. We were trained to write linearly. Background, design, experiment, results, and discussion is the social science journal formula. 

The writer is trained to clinically report in the passive 3rd person tense.  Skilled obfuscation and arcane words are seen as a sign of genius. There is growing evidence to indicate that perhaps this style of communication, in some instances, is not the most persuasive nor captivating approach (Fish, 2019).

Kidding aside, I struggled out of that 3rd person passive voice through the pedagogy of some of the major hitters in the field such as Ernest HemingwayStephan King, the Heath brothersRobert McKeeJohnathan Gottschall, and a few others.

Academic writing smothered me. I wanted to write how I thought…

“Cooper, Graham, and Smith (2005) found evidence that pet ownership was strongly associated with subjects’ high locus of control. That being said, their methodology sucked, but they tortured the data and used Structural Equation Modeling so they managed to get published in this fringe B rated journal.”

Ahh…that felt good. I found myself writing blurbs such as this and then deleting them in my graduate school days.  

Wading into the business world I was taught that if you are writing an article you better grab the reader hard by the collar in the first two sentences and get your point across.  Otherwise, you will lose them. I embraced this approach.

It didn’t matter if it was a white paper, a blog, or a presentation.  Lead with the lead.  If you read any newspaper you will see the same thing. The first few sentences in almost any newspaper is in essence ‘the story’, it is ‘home base’.

Recently, I saw Ira Glass speak at local venue. If you are not familiar with Ira, he is a master storyteller for NPR who creates amazing human-interest stories. They grab you and suck you in. His formula is sublime.

In his presentation he advised that in story telling you should first start with the “dead body”.  Next, you move the plot along. You keep moving the plot along until you get to the major “aha” moment.  The BIG idea.  

He said that years ago he thought he discovered something revolutionary in this approach.  He was quickly disabused of this revelation by a friend who pointed out that every preacher worth his crucifix and robes used the same exact formula.  In fact most story tellers use this same exact recipe. 

If you look at Hemingway’s extremely short story, it follows suit.

For Sale:

“Oh, look there Bob! There’s something for sale. I like things on sale!”

Baby Shoes,

“Baby’s shoes. Oh, they are so cute! I like those little shoes they remind of my kids when they were little. Cootchy cootchy coo”

Never worn

“Wait. What? What the? OH MY GOD! That’s crushing. Shame on you Mr. Hemingway! You’re a bad bad man for leading me down this dark path!”

In fact, all great stories follow some variation on that formula. “Baby dead, couple doesn’t need shoes anymore, they might be sad” doesn’t bury the lead, but I think we can agree it doesn’t create a very good story.

Think of your favorite story. One of mine is the original Star Wars (Episode IV).   In the opening few minutes of the original Star Wars, did we see the Death Star blow up?

No.

We saw a hottie Princess Leia record some mysterious message in a mobile garbage can while some maniacal telekinetic bad ass in a black cape and helmet  was running amok on her spaceship. 

Now that’s a great beginning! They buried the lead right down the center of the Death Star in the form of a torpedo in last few minutes of the film.

So I am revising my style a bit.  I will still need the hook to get the reader interested.  The trick is to be compelling enough to get your reader to the next paragraph, and then to turn the page, and then to chapter 2, until they can’t put the book down. If you made it this far, I am going to call it a success.

I think good story telling is not just whacking the reader over the head with news; it is feeding them a story.   You need to lure readers into your story restaurant. Once there, you better to feed them well with a plot that continues to move along. Make sure all courses are delicious and evocative.  Oh and they will be expecting dessert in the form of a compelling idea at the end. And it better be good.

 Of course, I am but a student and would be interested in your thoughts. What do you think? Do you like good desserts? Did I bury the lead? Should I care?

Learning CX by Doing: Reflections from our Ozark AirBnBs

Julius Caesar once said, “experience is the teacher of all things.” Sadly, those that are experienced don’t always teach and more worrisome is that those that teach aren’t always experienced.

We have consultancies advising large corporations on how to launch CX systems that they have never launched one before. There are institutions of higher education providing classes in entrepreneurship with professors who never worked in a real company let alone started their own. In some cases, we have software companies providing tools to solve problems they never have (or still haven’t) solved themselves.

In short, we have people pontificating and providing guidance on topics where they have enormous theoretical expertise, but very little in the way of practical experience.

I have to admit; it’s been a while for me too. While I can talk indefinitely about CX in B2B from my business experience, if I’m honest, the last time I dealt with a retail customer was around 1989 delivering pizzas to drunken college kids.

I recently took corrective action for this blind spot with the acquisition of a couple of Airbnbs. It hasn’t been easy, but we have learned quite a bit along the way. I wanted to share these learnings as they are equally applicable to both small startups and large global companies.

1. Design Your Experience for Your Customer

Bentonville has a surprising number of visitors for a small town in Arkansas. Some are business visitors, some are visiting family, some are in the midst of a relocation, and some are just people needing a place to stay for a while. While we have and do cater to all these categories, we wanted to focus in a specific visitor; the mountain biker.

Bentonville is blessed with hundreds of miles of hard packed and off-road trails. As such it has become a hot spot for Mountain Bikers through the country (and world). We established the Trailhouse to cater to these folks specifically. 

We made sure there was a bike stand out back for repairs, a place to secure bikes inside the house, a tool set, a hose to clean bikes and place to chill. Acknowledge our guests as newcomers, we also provide an extensive hard copy guidebook with brochures tailored to that adventure mindset persona.

2. Listen to Your Customers

To know your customer, you must listen to them. Ironically, my best source of feedback is not from Airbnb (although it is a good source), it is from asking my guests just one question “What’s missing that would make your experience better?” This has yielded some good insights. 

First serious mountain bikers have many of their own tools and pump, so that’s a nice to have. Bikers do like having a secure place to store bikes (inside) so bike stands are helpful, having some wash rags and a place to hose off their bike is helpful, and a gas grill is a must. Things will get dirty, so invest in some durable towels and avoid carpet if possible. Customer feedback doesn’t need to be hi-tech to be effective. It’s listening and taking action that helps improve the experience.

3. Create a Brand

While it might seem odd to create a brand for a few small homes in Bentonville Arkansas (we have our eye on expansion though), it has worked remarkably well in creating a modest but noticeable buzz amongst our guests. I am lucky enough to have some very talented creatives in my life who were kind enough to create a logo for us. From there we created stickers, floor mats, and other collateral to help promote our brand. Ever the researcher, I even tested several logos before arriving at the winner. 

Sound expensive? Not really, there are many resources such as Sticker Mule, Vista Prints, and others that can make this happen relatively. While the Trailhouse has a website (bvilletrailhouse.com) via WordPress (we are upgrading now, don’t judge us too harshly), Airbnb also has an easy to use and simple interface to help us market the Trailhouse brand. Also, while Airbnb does offer photo services, we spent a few dollars to have professional photos shot, which helps us stand out in the lineup.

4. It’s Not A House, It’s an Experience

This was our guiding principle in establishing the Trailhouse brand. Some hosts just post their condo on Airbnb or VRBO and list the facts…this many bedroom rooms…this many bathrooms, etc. We don’t do it that way.

We are not providing a place to stay; we are providing the experience of being in an incredible community and ensuring our guests get the most out of the short time they are with us. We are helping find them the right trails, right restaurants, right museums, and right stores to go to. We are recommending grocery stores or places to go swim or kayak. We are helping them make steaks on the BBQ or just relaxing with some beers after a day of hiking, biking, or just exploring the area. 

We have customized the inside of our homes to have photography of local landmarks. We have games for kids and adults. Guests can spin a few old school LPs on the vintage turntable. We have a variety of guitars hung throughout the property and amplifiers which we encourage guests to play. In one location we have a few skateboards and bikes to ride gratis.

The point is; its more than a nice bed to lay your head. We provide a place to live.

5. Be Responsive

Erin and I respond to all inquiries usually in minutes. People have many choices in where to stay. I have found that if you are quick to answer questions and inquiries this results in bookings. Also, avoid robo-responses if possible. People have specific inquiries, you want them to understand you know them and are responding to their specific questions.

This isn’t just for booking, guests have simple and complex questions during their stay. Make sure you are on top of it. They are strangers and that lag time between problem and resolution, no matter how small the issue, is a source of anxiety. Anxious customers are not returning customers. Be fast, be personal, and be helpful.

6. Don’t Skimp on the Little Things

The secret of great customer experience is that it is not usually the big things that matter. It’s the little things. With an average booking of around $300-$500 per stay, we can afford to spend a few bucks on our customers. For multi-day customers, we try and provide little surprises upon arrival (a trick we picked up from the Four Seasons and the Palmilla). Bunch of dudes coming = 6 pack of local craft beer waiting in the chill chest. Gal’s get away = some local chocolates from our local chocolatier Kyya. These are items under $10 that remind them of the great time they are going to have and also offer a nice surprise. This small investment can provide some degree from the inevitable problem

7. Manage Problems Aggressively

Which leads us to problem resolution. Things will happen. Our first tenant we had a bit of plumbing issue. I got notification late at night and was over there in the morning. I was mortified, the toilet had backed up and things were not good. 

Our tenants (about 8 20 something girls) were very gracious and understanding. After unsuccessfully trying to remediate the problem myself, I got a plumber over there to resolve. I refunded the full amount of their stay without them asking. To me, it was worth it.

They were extremely gracious and appreciative and rated us thusly (preserving our perfect score!). Bad things will happen, its how you deal with it that counts. Get there fast, be empathetic, get a short-term solution, and do everything you can to make it right.

8. Create a Trusted Network Of Partners

I have a new appreciation for hotel and property managers. There is a LOT to do. Fortunately, we have orchestrated a reliable set of folks to help us out. While we do much of the day to day stuff ourselves, we have outsourced lawn care, cleaning, and maintenance to others and are in constant contact with schedules and compensation. We pay them well and we get consistent high service in return. Takeaway: Don’t skimp on your partners. Treat them well and they will treat you well.

9. Trust Your Customers

Starting off we were nervous about people rallying the house or stealing stuff. To date, this hasn’t been a problem. In fact, it has been quite the opposite. People regularly leave behind their unused bottled water, clean up after themselves, and generally leave the place in great condition. One younger guy even took it upon himself to organize a storage shed out back. If you provide a great experience and people feel part of your brand, they will not only not damage it, they will sometimes take steps to improve it.

Good CX Does Result in Business Success

To date, it has a been a great experience for us. Sure, we could make more money if we didn’t provide little gifts or skimped on branding. In the end, the investment has more than paid off. Many of the learnings above don’t cost you a nickel to do well. You just need people who care about your brand.

While we aren’t getting rich, our efforts have resulted in some KPIs any hotelier would be envious of; we have 75%+ occupancy, perfect customer ratings, and revenue above average for our market. That’s after 6 months of business.

For years many clients in large organization have been anxious to see hard and tangible proof that CX results in strong business outcomes. As odd as it seems I have met people who simply didn’t believe investing in customer experience was worth it. Now I can tell you as a practitioner andproprietor; it works.

Are You Solving the Wrong CX Problem?

In 1936 Union Pacific Railroad had a client problem.

They saw their customer experience problem as a need to help their mining clients more quickly and cost-effectively get consumables and lumber in and ore and coal out of the mountainous Wasatch range.

Existing railroad technology didn’t cut it, so Union Pacific turned to their long-term partner the American Locomotive Company with their big problem. ALC responded by offering a humongous solution; the 4-8-8-4 steam locomotive also known as the “Big Boy”. 

Big Boy 4-8-8-4 Courtesy of WikiCommons

The 4-8-8-4 was a monster even by large rail standards. At nearly two stories tall and 1.2 million pounds, it had 32 drive wheels to drive the monster and 16 more to guide it. It could reach sustained speeds of up to 80 mile per hour and traverse steep grades other engines could not, all the while hauling 7.2 million tons of freight in nearly two miles of laden rail cars behind it.

While the envy of every railroad line at the time, the Big Boys useful career was cut short, going out of production after 4 years. General Motors’ E-85 was a diesel-electric locomotive that marked the extinction of the Big Boy specifically and steam locomotion in general. Costing almost a third less than the Big Boy, its annual maintenance costs were a fourth, demanded less human guidance and didn’t require water operate.

But the story doesn’t end there. The advent of the United States’ interstate highway system in the early 1950s eradicated nearly all rail passenger traffic and put a significant dent in short and long-haul cargo hauling. If that didn’t put the iron horses out to pasture the emergence of the DC-10 in the early 1970s did.

Creating the National Interstate Highway System circa 1955
Courtesy: US Department of Transportation

Asking the Right Questions

Did Union Pacific make the right call in 1936? 

Probably not. They thought of themselves as a rail company, not a cargo transit company. I doubt they investigated diesel-electric options back then (even though they existed at least a decade before), let alone more far-flung solutions such as rigid airships and other emerging technologies. No, I am certain the train guys at Union Pacific talked to the train engineers at ALC who were more than excited to build them a King-Kong train. 

Union Pacific was stuck in their steam locomotive framework and rushed to a technological solution they were comfortable with, rather than what was optimal. In short, they rushed to a solution without a strategy. As Albert Einstein once said, “given one hour to save the world, I would spend 55 minutes defining the problem and 5 minutes finding the solution.” Good advice.

History is littered with companies who thought they had the right solution, only to realize they didn’t appropriately define the problem in the first place. Smith-Corona typewriters, R.I.M. Technologies’ Blackberry, Kodak’s Polaroid, and even more recently Microsoft’s “Zune” music service are all lessons in misdiagnosis and a rush to a cure.

Today, many CPG companies are struggling for relevance with consumers more interested in fresh and locally sourced foods. For example, a cereal company might think their problem statement is “how do we get more people down the cereal aisle?” while their real problem statement should be “how do we rethink breakfast?”

It’s an easy mistake to make. We feel uncomfortable in the ambivalence of uncertainty and powerful psychological forces push us to closure. We are encouraged to have a “bias for action” sometimes skipping any CX strategy in favor of action.

Furthermore, powerful social-psychological make us prefer harmony amongst the tribe; even if that is not in the best long-term survival of it. Finally, there is enormous pressure for managers to “fix it” when their organization is faced with an imminent external threat. They regularly short cut the important first step of problem definition in favor of getting to the business of solving the problem.

Tip to Stop Solving the Wrong Problem

How do we hedge against bad problem framing? Here are a few tips that can help prevent your organization from trying to solve the wrong problem.

1. Ensure Diversity in your leadership

It’s not just an altruist thing to do. Diversity is critical for innovation and not getting blindsided by too narrow view of the world. In much the same way you would not put all your investment in one stock or one industry you should hedge your intellectual worldview by making sure diversity of thought is a priority for your organization.

This does not just include racial and ethnic diversity but functional, attitudinal, and personality diversity as well. Homogeneity is the enemy of innovation, but it feels oh-so-good when everyone agrees. A study by Boston Consulting Group found that those companies with diverse senior management had almost twice the amount of innovation related revenue of those who did not. The risk of lack of diversity is bad decision making. Having yes-men and yes-women are great, but it’s sure fired way to go out of business fast…or get people killed.

Takeaway: Ensure you have functional and individual diversity in your problem-solving teams. If you feel uncomfortable than you are probably on the right track.

2. Persistent in asking ‘why?’

It seems rudimentary, but there is a dearth of asking “why do we do it that way” in organizations today. Don Hull refers to the lack of second loop learning in organizations as organizational inertia.

The way we do business creates ruts in the road that are hard to pull out off. Past success of one approach makes us double down on that approach in the future. Managers make commitments to courses of actions whose initial purpose is no longer there. Relationships get in the way of logical decision making and organizational values transform into dogma. People crave certainty and construct mechanisms to create the illusion of permanence. This is detrimental to the long-term prosperity and survival of the organization. 

Furthermore, the tools we construct to solve problems enact a certain part of reality and shape how we frame the problem in the first place, thus censuring our ability to solve it. Surgeons like to perform surgery. Cobblers like to repair shoes. Both can solve a lower back pain problem. It’s taking a step back to find out what the problem is in the first place.

Perhaps no industry has deeper ruts of “how-we-do-things” than banking. However, some progressive banks are reframing the 150-year-old canon of how retail banking works. For example, Citizens Bank is rethinking the physical layout of banks. Acknowledging customers’ growing preference for digital interactions they are creating more self-help kiosks, cross-training employees, and reducing the space the needed by 50% in retail branches

Rather than the teller-behind-the-window format used for centuries they are opening up the floor to bring bank employees and customers together by eliminating physical barriers and making it a more friendly and less austere environment. Citizens are removing traditional customer irritants such as overdraft fees for small amounts, even though they are large revenue drivers. Some banks are taking this further and eliminating these fees altogether.

Takeaway: Challenge your organization as to why things are done the way they are. Has the environment changed? Are there better ways? In essence, it is wise to stay curious.

3. View the world like a child

My 8-year-old daughter just got a fish tank. You would think I created life out of sand and water by the wonder in her eyes. “Why does the silver fish swim on the top and the Mollies swim in the middle Daddy?” she asked. No idea. I didn’t even notice that.

The wonder of a new fish tank

The wonder of a new fish tank

This is the essence of human-centered design. Experience the world as a child or a visitor in a strange new country. If you take a moment to get Seinfeldy you will notice all kinds of things. Why do people tend to spread out in elevators? Why do people cram to get on an airplane that takes off at the same time for everyone? Why is my kid so infatuated with slime?

One progressive hotelier took this human-centered design approach to heart. Situated in the heart of Silicon Valley they experience more international visitors than many other hotels. As such, things we might take for granted; such as using a key card to gain entry into a room, might be a bit novel to someone traveling from far away. Through an empathetic understanding of their customers, they decided to be proactive in educating guests on how to gain access to their room through a demonstration model of a hotel door card reader at the check-in desk. Reception can easily show new guests how it works, without even uttering one word of English to achieve that understanding.

The Hotel Door Demo
Photo by Dave Fish

This is the key to insight. Be aware. Take on the viewpoint of others and be empathetic to their needs.

One exercise I use that brings to this light is taking on the persona of your customers. Make your executives go and buy the hamburgers you sell, open a banking account, or buy one the vehicles they manufacture. Take on the persona of a teenager, a busy mom, the elderly or someone with a disability. Every time I conduct this exercise it is much more powerful than any focus group or quantitative study can provide to move your executives to action. Be your customers for a while. You will be surprised what you find out.

Takeaway: Take your executives shopping or have them use your product and service over a period of time. Assume a new persona when experiencing it.

4. Explore analogs

To properly frame a question, it is often helpful to look across industries and occupations to see how they deal with a problem. My colleague John Palumbo CEO at Big Heads refers to this as “cross pollination” and think it is a fantastic idea for getting to both the proper question frame and potential solutions. He likes to mix unlikely people to help shed light on defining the problem, before actually solving it.

For example, say you are a grocery store and have an efficiency problem at check out at peak times. You might look to how F-1 Pit Crews move so fast. You might talk with beekeepers who work with one of the most efficient organisms on earth. What would beekeepers have to say about your queuing problem?

It also helps to look across industries. How does Disney Theme Parks deal with wait time and queuing issues? How do high-end hotels and airlines? What do top-notch waiters do at 5-star restaurants?

In looking at the problem of wait time at check out the answer many larger retailers have arrived at is to simply eliminate it. Rather than just self-check-out where there is still a line, retailers such as Walmart, Kroger, and Amazon are experimenting with ways of tracking items as they enter the cart through various new in-store technologies. When complete, customers simply pay and walk out. No lines, no wait time.

We take a general problem frame and then look for analogs across as many diverse domains as possible. Within there, can lie the problem that someone has already solved for you.

Takeaway: Look for other occupations, teams, and organizations that are trying to address analogous problems. Talk to them. Find out how they are framing analogous problems and gong about solving them.

5. Be flexibly disciplined

Psychologist Karl Weick related a story of an Italian army lost in the Alps. They used a map to finally get back to camp, albeit very late. When the Captain asked the company commander what happened, the wayward Lieutenant said “well, we were lost, but this map helped us make it back to base camp”. The Captain took the map and looked it over. He was surprised to find It was a map of the Pyrenees, not the Alps. 

The point is, in a bind, any plan will do. But having a plan is having a direction. It’s having a way out. But one must be willing to re-forecast that plan as things change.

One tool I have found very helpful in getting groups aligned on a common goal is something developed by Dr. Leticia Bristos Cavagnaro and her colleagues work in design thinking. It is a simple exercise whereby you identify three things; stakeholders, their problem/need and then the insight. You describe stakeholders in the most descriptive way possible, describe problem/needs with verbs, and the insight should answer the “because” of the other two statements. This leads to a good problem statement that can serve as a true north for the workgroup and/or organization.

For example

Our problem statement might be “We need to create a way to help business people who are new their CX role quickly learn and apply CX concepts to their own organizations that have immediate an immediate and demonstrable payoff.”

Takeaway: Make a plan using the problem statement format above. Get consensus from your team before moving forward to ideation and solutions.

More Focus on Problems

Unfortunately, most academic and corporate training focuses on finding solutions rather than problems. Noted psychologist Mihaly Csikzentmihalyi once lamented “Most schools, all you learn is solving problems; then you get out in the real world, you feel lost because nobody’s telling you what to solve.” I often find the same in my teaching. If I am very specific about the problem that is to be solved most students can get it. However, if I leave the problem ill-defined, it creates a source of both angst and poor class evaluations. In my mind, this angst is natural, and we should spend much more time finding the problem…then finding the answer. But perhaps I need to study the problem a bit more to be sure.

Sources: