Digital disruption is a phenomenon that is taking root across multiple industries. Ground-breaking technologies and business models are rapidly establishing themselves alongside time-honoured institutions. Examples of such disruptive businesses abound, including now household names such as Uber, Amazon, and Netflix.
Of course, this process of disruption and displacement is not new. The arrival of app-rich smartphones from brands such as Apple and Samsung supplanted the previously popular Blackberry and Ericsson. Digital camera pioneers Canon and Nikon captured market share from Kodak, which declared bankruptcy in 2012.
Among these examples, there is a clear trend. Digital disruption is only a negative force for those that choose to ignore or fight it. Embracing disruption leads to innovation and progress. Companies will be wise to formulate new business and customer strategies to enable them to ride current waves of change – not be swept away by them.
Many businesses are already heading in the right direction. According to IDC, 40 per cent of all technology spending will go toward digital transformation, with enterprises spending in excess of $2 trillion through 2019. However, future industry leaders will focus on rebuilding their businesses to achieve customer centricity.
Customer centricity: A brief summary
Putting customers at the heart of a business requires companies to transform themselves, their information assets and their internal processes to achieve a 360-degree historical and forward-looking view of their customers.
These insights drive smarter, data-powered engagement strategies that are key to improved customer service and genuine customer satisfaction. In turn, this will lead to higher retention and increased revenue over the lifecycle of the customer’s extended relationship with the business.
Following this transformation, it is important that every single customer touchpoint across the entire product and services portfolio will be optimised. In other words, the business needs to create a superior customer experience across all channels, and throughout the customer lifecycle. Ultimately, by satisfying and retaining customers, businesses can reduce customer churn. And that goes straight to the bottom line.
Crafting a customer-centric strategy
We can all agree on customer centricity as a vision – but what does it take to develop and execute a customer-centric strategy? Here are the six key ingredients:
#1 Unify all information across the enterprise with a scalable decision platform
Worse than incorrect or missing data is unused data. Blind spots and erroneous conclusions often arise from not factoring all available data into decision making. However, many businesses – both new and established – continue to structure their operations around siloed systems, data and processes. Having uncoordinated product and channel silos mean that a holistic view of each customer will remain out of reach.
#2 Deliver compelling, personalised customer treatments at every touchpoint
Today’s customers want businesses to know who they are, understand their needs and preferences, and provide a consistent customer experience. The answer, although simple, is not easy – use available data to fully understand your customers.
Identify each data source – both internal and external – for your customer base. Note any gaps in information and sources that can be tapped to plug them. It is imperative to use this data to drive all customer interactions and decisions to better understand your customers: their expectations, risks and drivers. Businesses can then interact with customers in their preferred manner and tailor these interactions to meet specific customer needs.
#3 Place strategies, rules and analytics in the hands of business users whenever possible
Those working in business and customer lifecycle decision areas frequently come up with promising strategy concepts that warrant exploration. However, they also run into common obstacles such as gaining access to data, translating customers characteristics into universal business terms, and sharing exploratory analytic results, all of which hinder progress.
By empowering business experts with extensive self-serve capabilities in areas like advanced analytics and outcome visibility, they will now have the means to fully explore all possibilities, simulate the results of alternative offers and strategies, and bring change-supporting evidence to the table.
#4 Make decisions transparent and explainable by repurposing connected decision assets across the customer lifecycle
Businesses should aim to reuse decision assets, such as customer characteristics, analytic models and associated actionable strategies, rules and calculations, across the enterprise. Sharing decision assets allows for common decision logic, and enables analytic strategies to be defined, centrally monitored and used when needed, which drives efficient processes.
Moreover, as each decision hub pursues its own objectives and enriches customer understanding with new data and increasingly sophisticated analytics, the collective business perspective expands. The potential to extract deeper customer insights from complex interactions among all this diverse data multiplies exponentially — and with it, the opportunities to learn, grow and evolve.
#5 Validate and simulate decisions before putting them into production
Armed with a deeper customer understanding, what next steps – for example, special offers and proactive communications – should businesses take? It is recommended that business experts use visual tools to create data-driven rules based on individual customer profiles, assign actions, simulate results against real operational data, and measure the impacts on KPIs. Having dashboards that display both predicted and compared-to results will also be useful.
#6 Get technologists and business subject matter experts (SMEs) on the same page
One of the advantages of a modern decision management system is that it enables greater visualisation of strategies, analytic results and other fairly abstract concepts. Technologists and SMEs can share a common understanding of what’s working, and this synergy is crucial in operationalising analytics and solving business challenges across the enterprise.
These six steps are already helping companies maximise their return on decisions across each customer’s lifecycle. And with the proliferation of data today, businesses should be positioning themselves to gain the actionable insights to fuel winning customer strategies. Effective competition rests on customer loyalty – it’s time to get started.
Bill Waid, General Manager of Decision Management, FICO