Disruption Need Not Derail Your Business
- December 12, 2019
Disruption and the customer experience (fail) connection
In today’s digital economy, talk of disruption dominates water-cooler and boardroom discussions equally, and for good reasons. It cannot be overstated — in today’s digital universe the stakes are high. More than one-third of executives in a recent Forbes Insights/Treasure Data survey say they are being directly affected by competition from digital and data-savvy players in their markets.
Additionally, a majority of executives say the risks of digital disruption are high, and many are already feeling the impact. In fact, 51% of executives surveyed report a high level of risk to their organization (in terms of market share and revenue), over the next five years from technology-driven disruption by startups or innovation by incumbent companies, according to the Forbes Insight survey.
Not surprisingly, businesses are rushing to the cloud and spending big on digital transformation. According to IDC, by 2024 nearly 50% of cloud computing software spend will be tied to digital transformation and will account for nearly half of all software sales.
As reported in CIO, leading digital companies generate better gross margins, earnings and net income than organizations in the bottom quarter of digital adopters. According to a Harvard Business School study, CIO reports, digital leaders post a three-year average gross margin of 55%, compared to just 37% for digital laggards.
Putting it plainly, disruption is the new normal. It is not something that ‘might’ impact your business somewhere, somehow down the road. Disruption is in full swing right now, and it’s taking its toll on your business today. The only question remaining is what are you prepared to do about it?
Customer experience fail is a business killer
The foremost determining factor in business success or failure today is the quality of experience businesses provide for their customers. Customer-friendly digital leaders, such as Amazon and Apple, steadily raise our expectations for a superior, personalized, fast-and-efficient experience. Uber has made hailing a taxi nearly effortless. Airbnb has redefined travel lodging. Netflix has revolutionized discovering and watching movies. The list goes on and on and grows every day.
These digital leaders (among others) have set the customer experience bar exceedingly high. At the bottom, the root cause of customer experience fails is the overarching failure, borne of inertia and/or complacency, of most businesses to match the stellar experience digital leaders have conditioned consumers to expect.
As more and more organizations step up their digital game and, in so doing, further condition consumers to accept nothing less than satisfying, seamless and personalized experience, each and every subpar experience provided by a business lagging behind the digital curve is glaringly obvious.
Results from a recent survey independently carried out by Opinium Research speak directly to the extent and consequence of this expectation/experience disconnect. According to the survey, “82% of consumers believe organizations provide a disconnected experience, failing to recognize preferences across touchpoints and provide relevant information in a timely manner. Nearly three-quarters (72%) of global consumers would consider changing service providers in response to receiving a disconnected experience.”
The inextricable connection between poor customer experience and death by disruption cannot be denied. But it can be avoided by taking action now.
Cloud CRM to the rescue
Two decades in, and the cloud is at the front and center of every business leader’s mind. More specifically, deploying Customer Relationship Management (CRM) software, or in today’s parlance, Customer Experience (CX), is firmly and primarily a cloud-first initiative.
The reason for CRM’s dominance in the cloud is straightforward enough. Simply put, digital transformation cannot be cleaved from cloud-based solutions. In fact, all advanced, rapidly emerging technologies are dependent on the cloud.
But focusing too closely on technology misses the mark. Digital transformation is about much more than wielding the latest technology. True transformation is about capitalizing on the relationship between technology and customer behavior, and leveraging disruptive technologies to close the gap between your customers’ high expectations and the experience your business may provide.
Only cloud-based CRM deployments, even if in an hybrid environment, can provide the scale, speed, connectivity, adaptability and innovation your organization needs to attract and retain life-long customers.
Not incidentally, in their most recent report, Customers 2020: A Progress Report, the CX exerts at Walker estimate that by 2020 customer experience will be the most important differentiator between brands, overtaking both price and product.
In line with this, spending on customer experience technology will reach $641billion in 2022, according to new research by IDC.
To help you better understand the challenges your customer’s face when doing business with your organization, NTT DATA offers a comprehensive Customer Friction Factor℠ (CFFSM) service. Our CFF service takes a 360° view of the customer journey and, in a matter of weeks, provides detailed insight into interactions that negatively impact your customer’s experience. We also provide comparisons against your competitors and identify actionable opportunities to reduce customer friction and increase customer loyalty.