A recent Forbes article provides a harsh reality check with 7 out of 8 digitalisation projects resulting in failure. I’m your customer: make my life easier, deliver to me an experience transformation.
Nowadays, every company I met is “extremely busy” in a digital transformation project. When you ask them what does exactly mean digital transformation they start to use, what I define, simply buzzwords: apps, big data, artificial intelligence, omni-channels, single view of the customer… bullshit bingo!
All of them use the same keywords, few of them think about how to make my life – as a customer – easier, disruptive and memorable. Most of them they simply pretend to move processes, deep embedded in legacy systems, in a new modern technical shape: app, mobile website, etc. They start the digitalisation from the technical angle. Basically they pretend, in a very arrogant way, we all become their employees without paying us a salary.(!) The results: failures, a lot of failures. Some examples?
- An insurance company offers me its ‘fantastic’ app to manage my account and my documents, as well the whole family profile and their documents. First issue: login to that app is a nightmare, (hard to believe but hardest than log in your Microsoft account) every time you try, you must pass through a two factors authentication. Both, the website and the app, are miserable slow. Conclusion: you promise to make my life easier, it turns out in making my relation with you worst than before. I will continue to generate costs contacting my customer rap by phone or email. Moreover, you left unfilled a competitive advantage gap: if a new insurance will come and fill it making my life easier… well a sure churn for you guys and a like on the facebook page of your competitor!
- A television company offering me their fantastic 25 apps to be connected to 25 different services…. (I am not kidding… 25 apps!!!) are you guys so stupid to think I will download 25 apps? Come on, give me a break! Give me a smartphone for free and I will load your ‘extremely useful’ 25 apps!
- But probably the 1st prize goes to a fantastic app supported by different banks in Switzerland to compete against Apple Pay and Google Pay …never seen something so useless as Twint. Thoese guys invested, probably, millions of dollars without thinking about the User and Customer Experience. Unbelievable!
Digital transformation holds the promise of revolutionising business, revolutionising society and revolutionising the way we live providing us a totally new and disruptive Customer Experience. Something will change our lives in a way interacting with that company and that product will be so easy and quick, that you will get plain of time to dedicate to other more interesting things. The reality: how many companies make the correct moves in digital to capitalise on the opportunity to positively transform their customer’s experiences?
The bigger question is whether the companies that are investing in this evolution are delivering the customer experience expected returns, seeing improvements in revenues and overall customer loyalty?
On the other end, top managers are complaining because disruptive startups are eroding the market share with totally new business models, and revolutionary customer experiences in a way products and services become sticky to consumers. To named few of them you can consider Uber, AirBnB, WhatsApp… but also very small and less popular companies. One of my favourite example is Expensify.com. Before it was introduced in my Company, I was constantly in delay of sending my monthly expenses report. I should not say it but I had delay of 6 and even 12 months! The SAP way to create monthly expenses report is a nightmare. After Expensify was introduced, it turned creating an Expenses Report takes me not more than shoot a pictur or forwarding a digital invoice to a generic Expensify email address. No need to fill out anything: the automatic smart scanning does everything for you (!). Expensify, I love you, I’m now the king of expenses reports!!!
But why customer experience is not dominant in a digitalisation project?
The real issue: technology dominant thinking is often not customer centric. If you run a digitalisation revolution asking your legacy IT department to drive that, would be similar asking Luis XVI to lead the French revolution. No way!
Customers don’t value new technology for the simply fact is a new technology, customers want you to make their life easier, they want to save time interacting with you and, why not, they want to have fun. In a simply way, customer value their EXPERIENCES highly, the technology itself doesn’t play a big role in the eyes of your customers. Technology is your problem, not your customers problem. Explained in a simply way we are living in an Experience Economy.
A very simple figure to support my thought: “look-to-book ratio” is a famous airlines KPI. Basically express the number of unique views before the airline gets a book. Well, in 1995 the average KPI was 10 – 10 views before a book – while in 2015 it reached 1’000. It means that nowadays we have such simply way to scan airlines offers that before we take the final decision, we are really well informed… and, by the way, it doesn’t take a great effort from ourself. We, as consumers, must thank the digitalisation in this case. Same for Hotel and car rentals. Easy to search, easy to compare, easy to select, easy to buy …but very easy to drop as well.
So what must a company do to be part of the 16% companies that successfully digitally transform?
Digitalisation is difficult because represents a complicated form of design around a totally new – and hopefully easier in terms of effort – Customer Experience. Great digital design requires great teamwork and collaboration skills, but the most important component is to place the customer in the exact center of that process.
Difficult factors, among the others, are:
1. Understanding very well customer behaviour.
2. Understanding very well customer needs.
3. Understanding very well your industry, your competitors and the external industries are competing with you on the exact same share-of-wallet: if you, as Taxi Company, offers the same experience Uber provides, can potentially Uber win your share of market using same regulator compliance drivers? Call them ‘old taxi drivers’ if you want.
Among technology factors there are – and here we need a strong paradigm shift in the IT departments mentality:
1. Be agile and fast in developing new features.
2. A tremendous increase of flow of data. Don’t call them Big Data, because are not – few companies in the world they really have Big Data …and they are going to win the market if we are not able to compete with them. It is a matter on how to extract relevant information from it. I would call it more Smart Data.
3. Decomission ‘old’ legacy systems and turn the IT landscape into an agile API ecosystem. This is an important point. If you consider ‘old’ airlines model build on legacy systems, how they can compete with new entrants challenging their business model exactly on that?
It is clear that Customer Intelligence becomes the first source of competitive advantage in this walk to digitalisation. Customers will decide if you are successful in your digitalisation process and if your experience will fall in the 16% of great digitalisation projects. But be very careful: missing to deliver an experience that shorten time and make things easy for your customers, will end up in a miserable failure. The lack of a supporting design strategy with proper Voice of the Customer insights, will create what I call a ‘Customer Experience Gap’. A gap between the expectations of the customer – measured considering the ‘old’ experience – and the new experience provided by the digitalisation. If a bridge between new experience and customer value is not formed, the opportunity is lost. A customer experience not able to exceed the actual expectations will create, in the head of the customer, confusion and uncertainty. The perfect gap to be filled by a competitor aggressively looking around to acquire new customers. When digital transformation initiatives are out of control and voice of the customer not monitored continuously, a poor customer experience will be the final result.
No technology solution can fill a customer experience gap once a customer decides it is unbridgeable!
Creating an Experience Transformation
Customers are people too. The very people that make up the customer segments (audiences) marketeers want to influence. Customers have feelings, may act irrationally and are prone to making mistakes. Often it is ignorance of the emotional factors that influence behaviour and motivate people that causes initiatives to fail. This is increasingly more likely to happen when there is no clear and company-wide customer experience philosophy. Ultimately, this happens because there is no Customer Experience culture and proper User Experience design in place.
To create an Experience Transformation you need a design strategy to accompany and support your digital transformation program. Otherwise the resulting customer experience gap will keep increasing until you fail or become one of companies in the 84% failure category.
Ultimately, to drive value that will keep your customers engaged and their experience with your company relevant, the objective should not be a digital transformation, it should be an experience transformation.