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4. IMPLEMENTATION PRIORITIES The most important activities required to deliver the Desired State


Action Prioritization The Prioritisation Approach

The top 25 priorities for capability uplift

Summary of the logic behind the prioritisation

The prioritisation logic within the SCHEMA® Toolkit is based on:

• The Weighting of the Capability, which is calculated from the sum of the weightings of the individual Practices that comprise the Capability. These weightings were allocated by the SCHEMA® design team and reflect the contribution of the Capability to the overall Customer Management sophistication and specifically to the financial value delivered or directly enabled by the Capability. • The Current Score for the organisation’s performance in the Capability where a lower score tends to lead to a higher level of priority. Note that any practices that were agreed as being ‘not applicable’ will have been removed from both the scoring and the weighting of the Capability and will not have any adverse impact. • The Average Benchmark Score across the benchmarks detailed in section 1. • The Support to the Desired State as defined in section 2. This is based on a detailed cross-referencing between each of the 20 Direction-setting dimensions and each of the Capabilities. Capabilities supporting more than one of the desired state changes will tend to be rated as high. • A Calibration exercise to tailor the prioritisation algorithms to 6 factors that have been shown to have a substantial impact on the relative importance and “order of addressing” activity in Customer Management Capability Uplift.

Capability required

Priority Index

Impact of current capability

Managing the early experience

100

Medium

High

Very High

High

Understanding customer loss

100

Very High

High

Very High

Very High

Measuring Customer Engagement

99

Low

High

Very High

High

Responding to wider dissatisfaction

92

Low

High

Very High

Medium

Customer-facing staff

90

Very High

Very High

High

High

Engaging with communities of interest

86

High

High

Very High

Medium

Basic service delivery

84

Very High

High

High

Medium

Onboarding and welcoming

83

Medium

High

Very High

Medium

Understanding loyalty

83

Low

High

High

Very High

Developing customer-impacting technology

79

Very High

High

High

Medium

Building a customer culture

74

High

High

High

High

Use of exit barriers

74

Very High

High

Low

Very High

Saving customers who want to leave

73

Low

High

Low

Very High

Identifying dissatisfaction

73

Medium

Medium

Very High

Medium

Researching customer experience

70

Low

High

High

High

Exploiting influencers and referrers

Exploiting influencers and referrers

70

Low

High

Very High

Medium

Management of 'at risk' customers

Management of 'at risk' customers

69

Low

High

Medium

High

Rewarding loyalty

69

Medium

High

High

High

Exploiting non-owned data

Exploiting non-owned data

68

Low

High

Very High

Medium

Managing customer-facing systems

Managing customer-facing systems

68

Medium

Medium

High

Medium

Involving customers

66

Medium

Very High

Medium

High

65

Low

High

Medium

High

64

Low

High

Very High

Medium

0 Managing the early experience Understanding customer loss Measuring Customer Engagement Responding to wider dissatisfaction Customer-facing staff Engaging with communities of interest Basic service delivery Onboarding and welcoming Understanding loyalty Developing customer-impacting technology Building a customer culture Use of exit barriers Saving customers who want to leave Identifying dissatisfaction

Status of main markets of operation

Extent of annual customer attrition

Static or contracting

Steady growth

Around 10%

More than 20%

Rewarding loyalty Single Product

Medium

Wide

Breadth of Portfolio

Value spread of customer base

Narrow (99/5)

Typical (80/20)

Wide (20/20)

Involving customers Understanding value decay and dormancy Workflows moving towards real-time

Ability to make changes to systems

41

Challenging

Possible

100

Impact of Client Calibration

Rapid growth

Researching customer experience

Less than 5%

50

Impact of Impact of benchmark Direction comparison Setter

Easy

Understanding value decay and dormancy Workflows moving towards realtime

Getting to know new customers

Getting to know new customers

63

Very High

High

High

Medium

Customer data analysis Systems

Customer data analysis Systems

63

Low

High

High

Medium


Priority Action Areas (1 of 4) 16 Managing the early experience

80 Measuring Customer Engagement

22 Customer-facing staff

The organisation's segmentation framework includes a specific segment or set of segments for customers who are new and about whom enough is not known (yet) to allocate them to an 'in-life' segment. Customers remain in this segment throughout the period covered by the organisation's defined 'early experience' but can and are reallocated to an on-going segments as soon as it is appropriate to do so without having to wait for overall (often annual) segment at re-allocation processes.

The organisation should put in place a model whereby paid media is tracked using standard forms of media measurement such as impressions (reach) and share of voice. Alongside this, the organisation should be equally concerned with the level of engagement, participation and involvement with its Marketing activities and should implement a model to track 'expressions' - that is the level of engagement as tracked by volumes of 'shares', 'likes', 'comments' and other forms of social interactions. Measure total Marketing program impact by using a combination of 'Impressions AND Expressions' - not just using one or other type of measurement approach. Embed this approach across business units/markets/brand teams and is use it consistently to track performance.

Utilise expert software or resources (either internal or external) to carry out structured monitoring and reporting of the tone used by the organisation in customer interactions as well as the accuracy and effectiveness of the outcome. These should cover real-time communications such as voice and chat as well as non-real-time such as email, letters and web forms. This approach will identify attributes of tone such as empathy, authority, expert that are relevant to the organisation's brand and positioning.

Analysis and research findings have been fed into an understanding of the period of time that typical new customers take to really settle into their relationship with the organisation. This is over and above any welcoming activity and formal definitions of customer 'activation'. It typically extends into the time during which they are at risk of early cancellation, early dormancy or even making their next purchase decision based on their first purchase experience with the organisation. The definition may be in terms of a time period or up until some lifecycle stage or trigger. It is recognised that this definition will be more meaningful in products / services where there is some on-going purchase / billing / service pattern rather than single, stand-alone and infrequent purchases.

18 Understanding customer loss Conduct research with at least a substantial sample of customers who have been lost from the organisation to understand the reasons that they took their business away. Compare the results for customers of different types (different segments, channels, product holdings etc.) to understand whether particular reasons for loss relate to specific customer types. Design the research to ensure that real reasons are captured along with factors such as when the decision to leave was taken. Take extreme care to avoid giving the researched customers easy options to answer in a way that is 'not going to get anyone into trouble'. Develop a definition of 'lost' CUSTOMERS as opposed to product holdings and consistently apply it across the organisation. Vary the definition for different categories of customer based on the types of product they have. In some cases the definition will rely on an active 'cancellation' or non-renewal of a contract / policy etc. but it is frequently based on a period of zero transaction value (probably after going through a 'dormant' phase). Do not just rely on reporting of lost customers through sales channels especially where customer losses reflect negatively on the channel. Report the REAL level of customer loss regularly to the senior leadership team.

Define a set of engagement levels that are relevant to the way the organisation works, what it is trying to achieve and how it wants to report engagement. These should take into account a careful definition of the nature of engagement that it is aiming for that considers emotional engagement alongside more structural / transactional tie-in.

33 Responding to wider dissatisfaction In any social media community, peer-to-peer support (or defence) of the brand and its products / behaviours is more powerful than self-defence. Encourage fans to interact on the site to comment on others' negative comments and thanks them for doing so. This may happen naturally, but the company must also engineer a dialogue with the best and most prolific fans to engage them even deeper into the brand and subtly encourage their defence activity. Implement wide scale social 'sensing' as well as listening for individual expressions of dissatisfaction (microlistening). This involves monitoring for patterns of input to social channels both in terms of the volumes, nature and sentiment of the input provided. It should go much deeper than just counts of mentions by topic and looks at the way things are being said, possibly by using a combination of carefully designed searches and manual interpretation of the results, but ideally using context-based analysis tools to achieve much greater scale and reach. This capability is often outsourced to a specialist provider who may overlay 'market' listening as well as 'organisation' listening.

If appropriate this should include the use of advanced context analysis services or software to automate the monitoring and allow it to happen on a wider set of communications. Capture examples of great tone and poor tone in very similar contacts with very similar content and use for coaching.

8 Engaging with communities of interest Profile and research the most important customer segments (e.g. most valuable segment) in some detail to understand how formal or informal networks within those segments operate (e.g. a user group forum, alumni, local business group, family network, golf club, book club etc.) Carry out formal social network analysis (SNA) to identify the most influential nodes in any network. Ensure that this insight is deployed in marketing (e.g. in content creation and targeting; channel targeting, media targeting, affinity groups)

21 Basic service delivery Carry out analysis on the relationship between performance levels achieved in each of the elements of organisation's defined basic service delivery and the performance in the key customer value drivers such as conversion rates, activation rates, attrition, dormancy, cross-sell ratios etc. This analysis must look for simple, single relationships such as that between increased billing accuracy and reduced attrition or between slower enquiry answering and reduced cross-sell. It should also look for combinations of elements that have impacts on single or multiple value drivers. Care should be taken to ensure that any time-lag between the cause and the effect does not stop the relationship still being identified. Define and publish all of the elements of basic service delivery performance levels so that they are easily accessible for customers even if they are not pro-actively communicated in a customer charter or similar.


Schema implementation planner