Customers are juggling more than ever before, and companies are realizing a heightened need for ease of doing business: value with minimal hurdles, hassles and worries. Essentially, it’s delivering your brand promise, as promised.
Ease of doing business quantifies the extent to which customers are enhanced or constrained by your enterprise.
Ease-of-doing-business measures value: benefits versus costs. The equation is called Customer Experience Value Quotient. It compares desired versus undesired outcomes, as seen by customers. Since the pandemic, customers are hyper-sensitive to companies syncing with their realities.1 Those who excel in minimizing customers’ undesirable outcomes while maximizing customers’ desirable outcomes will be rewarded.
- Outcomes are the basis for customers’ behavior: rebuy, recommend, etc. Outcomes involve what your solution is integrated with in customers’ life/business. Desired outcomes are contributors toward customers’ purposes.
- Undesired outcomes are inhibitors of customers’ purposes. They are surprises in conflict with your value proposition.
- Outcomes are rarely tracked today — they’re not the same as interactions or features. Outcomes are about your customer, whereas typical voice-of-the-customer (e.g. NPS) and customer service and success metrics are about your firm, product or people.
- Outcomes must be judged from customers’ perspective. They are an accurate view of value to customers. They can be tracked relative to expectations, alternative solutions, and over time.
- Outcomes should be tracked for separate customer segments, which should be defined by end-to-end journey expectation-sets.
Outcomes must be both effective and efficient. Effectiveness is provided by the product, service, personnel, image, business model, and so forth. These are typically included in developing a marketing value proposition, essentially your brand promise. What’s often overlooked in a value proposition are customers’ costs beyond money: time, effort, worry, and missed opportunities.
Improving customers’ time, effort, worry and opportunity costs are most important, especially today. It’s the best path to increase trust. It will boost your customer experience value quotient significantly and reduce your costs, too. These elements may be the hardest things for your competitors to copy, and therefore, your surest strategy to sustainable value superiority.
To innovate superior value:
- Listen and observe: Customer experience outcome research, which involves ethnography to observe customers in their natural surroundings, reveals a more accurate and realistic viewpoint of the CX value quotient.
- Benchmark: Plot all available solutions by customers’ desired outcomes. Rank-order desired outcomes by importance x frustration x frequency. Now you’re able to see things the way the customer does: for the most important outcomes, how do the choices compare? Root cause analysis may identify engineering issues, service skill gaps, business process complications, or outdated policies.
- Roadmap: Quantify the value ratio for all choices available to your customer. To develop a holistic perspective, plot these quotients as they existed in the past, as they currently exist, and as you project them to evolve in the future.
Ease-of-doing-business will be rising in importance to CEOs, industry analysts, and media. 181 CEO members of Business Roundtable signed a declaration in August 2019 that the mindset of “purpose of business is maximizing value for shareholders” is outdated. Instead, they committed to this modern standard: “purpose of business is to benefit customers, employees, suppliers, communities, and shareholders”.2 Indeed, standout firms that aligned the interests of all stakeholder groups outperformed the S&P 500 by an 8-to-1 ratio.3
A companion metric is ease of work, which tracks value from the employee viewpoint. These 2 key performance indicators are precursors to value seen by communities and shareholders. Problems or victories in ease of doing business and ease of work will be reflected in value to communities and value to shareholders.4
The CX value quotient can play a strong role in:
- Corporate strategy trade-off decisions: how to maximize growth and value.
- Closing the brand-customer gap (matching marketing/sales promises with operational delivery of value).
- Building trust, relationship strength, and value growth with all of your stakeholders.
Superior value is the objective of customers and businesses alike. Involve your whole organization in outside-in thinking and continual improvement by focusing management of your business on the customer experience value quotient.
1Just 8% of consumers think brands should stop advertising due to the coronavirus outbreak, MarketingWeek, March 25, 2020.
2Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans’, Business Roundtable, August 19, 2019.
3CEO’s Guide to Growth through Customer-Centered Management, CustomerThink, Lynn Hunsaker, January 16, 2019.
4CEO’s Guide to Growth through Customer-Centered Capability, CustomerThink, Lynn Hunsaker, December 30, 2019.
Read more: Balancing between Strategic and Operational Delivery