How to Use Data to Drive Investment Decision-Making
Featuring contributions from members of the Women in CX online community and summarised by Harley Stabler.
Every month, members of the first global community designed especially for women united by our interest in advancing customer experience meet to discuss, dissect, and disentangle an issue faced by customer experience professionals.
These roundtable discussions seek to shed light on and offer solutions to some of the most pressing problems of the sector.
This blog summarises the forum where members discussed how to use data to drive investment decision-making, including selecting and utilising the ‘right’ data for the industry and organisation, how to adopt an agile methodology to demonstrate ROI, and how to present the data in a way that resonates and secures stakeholder support (and hopefully, buy-in!).
Using Data to Drive Investment Decision-Making
According to Bob Thompson, founder of CustomerThink Corporation, 93% of customer initiatives fail (yes, that many!), with as little as 23% of C-suite respondents claiming that their CX investments brought about ‘tangible benefits’.
Why is this? And what can we do to demonstrate the impact of our CX initiatives to stakeholders?
Following forum discussion, it quickly became apparent that businesses soon become disillusioned when CX-ers fail to explain the results of their initiatives. This is often the result of CX initiatives that aim to do too much and, as a result, take far too long!
By adopting an increasingly agile approach – combining the science of data with the art of CX – we can avoid stakeholder rejection.
How to select the right data
“A potential pitfall to avoid is getting distracted by all the data points available to the extent that you forget the true focal point of any journey – the customer.”
– Sandra De Zoysa.
Considering the wealth of data at our disposal, it’s important that we recognise that there is no ‘one-size-fits-all’ approach and that each industry has its own set of key performance metrics.
In designing our initiatives, it’s critical that we identify the key metrics for our organisation.
Key performance metrics differ dependent on industry, for example:
B2B vs B2C
Profit vs non-profit organisations
Regulated industries
What questions should we consider when selecting data?
Before implementing our CX strategies, it’s imperative that we understand the stakeholders’ primary and secondary goals.
What results does the given strategy seek to harness?
Selecting the correct data will enable us to measure and meet these objectives.
Questions to consider:
What are the strategic objectives of the organisation?
How are they measured?
Who owns what metrics?
Which metrics will your CX initiative influence?
What data is available?
What insights do we hold that provide evidence of efficacy?
Additionally, it’s imperative that we consider who needs to be engaged with the project. Creating a stakeholder map can help you to identify key players and to create a plan of action.
Typical mistakes (and how to avoid them!)
Attempting to prove the ROI of CX in its entirety.
As CX-ers, we recognise the importance of our initiatives and the results brought about by them, but if we’re unable to communicate these to the stakeholder, we run the risk of losing their support.
As highlighted by members of the WiCX community, ‘stakeholders want stuff now’ and will respond to tangible results.Often our CX projects are too long-term!
When championing the adoption of an increasingly agile approach to CX, as opposed to attempting any form of ‘customer-experience transformation,’ the key is to set achievable targets and to prove these (quickly!).
Securing ‘little wins’ will encourage stakeholder support and enable you to secure further buy-in down the road.
How to implement an effective CX initiative
Create a project charter – a holistic overview of a project. Outline key objectives and ways in which these will be met.
Establish clear KPIs by which to evaluate success.
Create governance groups with the data/metric owners.
Agree data sets and KPIs with the stakeholder. This is a big one! To avoid ‘shifting goalposts’, it’s important that we identify (and communicate to the stakeholder) what exactly it is that the project is going to deliver. The importance of collective understanding – operating without siloes! – and an awareness of common goals are paramount for a project’s success… and for stakeholder satisfaction!
Report back with data to evidence findings regularly.
Managing your CX project
Stakeholders respond to tangible results – factual proof points to support the decision-making.
As such, CX-ers must prove the benefits of their CX projects and do so hastily!
According to the members of WiCX, how can we do this?
Start small. Keep projects short, simple, and controllable. In doing so, we can quickly prove the impact of our CX initiatives.
Adopt a ‘test-and-learn’ approach. To prove the ROI of CX, ‘changemakers need to connect money and data to key aspects of the customer journey.’ As opposed to lengthy CX transformations, we should implement actionable strategies and then (and only then!), scale our projects upwards depending on their success.
Conduct A/B testing within digital projects.
Create control groups versus test groups in wider programmes.
Take baseline measures and track change over time.
Report back regularly with data about a project’s progress.
Adjust your approach as required.
How to communicate results using data
‘As simply as possible.’
Tell the story, providing data as evidence.
Avoid data overload. Emphasise key, standout metrics.
Don’t present the minutiae but have the numbers to hand. Ensure the data is readily available for those who wish to delve deeper.
Provide forecasts that display the likely impact of a CX project if rolled out. Long-term benefits are supported by the success of short CX initiatives. Tangible benefits demonstrate the value of CX, allowing the stakeholder to tie CX to the business’s bottom-line.
Numbers not your strength? Recruit someone to help you!
“The first rule of management is delegation. Don't try and do everything yourself because you can't.”
– Anthea Turner
Members of WiCX highlighted that collaborating with data-orientated minds is the smartest solution.
Making friends with data scientists, finance people, and the ‘guys’ who own operation metrics is sound advice. They can become our greatest allies in supporting our cases and using data to help drive decision-making.
Conclusion
CX as a discipline is in jeopardy.
Unless we become more commercial (and prepared to use evidence and data to drive decision-making), we’re at risk of being dismissed as ‘fluffy’ members of the colouring-in department.
Remember to keep your scope small, projects tight, data sets clear, KPIs relevant, and your reporting watertight!
With evidence to demonstrate the ROI, you’ll be able to predict the impact of your initiatives at scale and, all being well, will have the support of the business to scale like wildfire!
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Contributors
Thanks to WiCX community members for contributing to this discussion.