Improving the Customer Experience: Business Necessity and a Potential Goldmine

Improving the Customer Experience: Business Necessity and a Potential Goldmine by Tim Srock

Customers want their interactions with a business to be smooth. But a nice, frictionless experience is an elusive target. Expectations are constantly evolving because companies are perpetually leveraging new technologies and capabilities to make that customer experience even smoother, even easier, even more pleasant.

With an average of 10 digital touchpoints between customer and company, creating a seamless experience is a massive challenge. It also requires a significant dedication of resources – from mobile app to AI-driven chatbot to website to automated phone tree. Ensuring that all these functions work in top form requires special software, tech support, and staff.

Changes in the B2C world often redefine what an easy digital interaction with a company looks like and feels like – thereby making a B2B portal or digital touchpoint seem antiquated by comparison. Some might argue that the customer experience in the B2B world isn’t as necessary; B2B customers are other companies, not individual consumers, so their expectations are different.

But people thinking along those lines are in the slim minority. According to research conducted by Forrester, 80% of the respondents in a global enterprise survey said improving customer experience was one of their top business priorities. According to the 2020 Customer Experience Benchmarking Report by NTT, 82% of organizations agree that improved CX offers a competitive edge; 58% even consider it a primary differentiator. However, only 29% claim advanced or optimized progress in their CX practice, while 71% are still developing a CX strategy.

To sum it up – CX is vitally important in the digital age. And while most organizations are planning to improve their customer experience, very few of them are actually doing so right now.

The opportunity to pull ahead of your competitors on the customer experience front is massive. Close to half of the organizations surveyed reported that improved CX had a measurable impact on the business; of that group, 41% reported an increase in revenue, and 33% reported a reduction in costs as their ROI.

Digitalize everything

In a digital business – every process, every function, internal and external, is digitized. Dated, paper-based systems within a broader digital organization will always be the squeaky wheel needing the grease. Even a handful of analog processes in a primarily digital enterprise will prevent inefficiencies from being addressed because, compared to a manual process, any digital function is almost always better.

Ultimately, every process affects the customer experience. The massive problems within the B2C consumer supply chain right now are an excellent example of that. A consumer might only interact with an individual company’s digital properties when they’re buying a gaming system or new pair of shoes – but there is a wealth of B2B vendors connected to getting the product to that consumer. Global disruption to the supply chain, yet another side effect of the pandemic, has impacted manufacturing, distribution, shipping, invoicing, storage, and delivery.

According to a recent survey of supply chain professionals, a scant 5% consider their fulfillment operations “highly automated.” A staggering 45% reported that their organizations still rely mostly or entirely on manual processes. With empty shelves and hugely extended waiting periods for many goods, the potential impact of inefficient back-end processes on the customer is evident.

The first step in enabling your organization to provide an optimized customer experience is to ensure all your processes are digital. And not just digital – but digital and capable of evolving and being updated as needed. Today’s cutting edge will be old school tomorrow, and companies primed for change have a distinct competitive advantage. IDC predicts that “driven both by escalating cyberthreats and needed new functionality, 65% of organizations will aggressively modernize legacy systems with extensive new technology platform investments through 2023.”

A fully digital, agile organization will have the ability to adapt to a changing market in real-time, at scale, putting themselves way ahead of their competitors.

Digitally transforming your entire organization is crucial. It’s also the first step in creating a digital ecosystem. That might seem like a massive leap from upgrading how your customer interacts with your company, but digital ecosystems are inherently customer-centric.

Your organization is likely already evolving in that direction. Do you rely on partners for elements of your core business functions? Are your systems connected to third-party platforms through APIs? Does your IT department contract out for legacy software updates? If so – you’re already working within a digital ecosystem.

According to McKinsey, digital ecosystems power seven of the world’s 12 largest companies by market capitalization. Digital goliaths like Apple, Amazon, and Google control entire markets. Competition against those titans falls somewhere on the scale from difficult to impossible.

But, creating a digital ecosystem isn’t the sole purview of titanic organizations. Any organization in any industry can shift to this business model and set itself up for exponential growth.

A case for working smarter, not harder

The why of creating a digital ecosystem may be more apparent than the how. Digitizing dozens of manual processes alone is a massive undertaking. Improving and modernizing your customer-facing applications and digital properties is another enormous project. And updating legacy systems is the living nightmare we all know it to be.

To become an agile, customer-centric digital ecosystem, you need to do all that and more.

Again – how?

A digital ecosystem is built by intelligently leveraging and combining existing tools and technologies to create a unique technical landscape that fits your business. One tool that has a proven track record of accelerating digital transformation is low-code.

Staying competitive and gaining market share doesn’t mean you always have to be first (though that helps), but it does mean you have to be fast. Pivoting to respond to disruption is easier when you can change optimized digital processes quickly. Systems and applications built with a low-code platform are inherently flexible, making it possible to iterate at speed and scale. An adaptable organization can react to massive shifts in the market. An efficient organization is more likely to cause a market shift.

According to Gartner, “by 2024, low-code application development will be responsible for more than 65% of application development activity.” Low-code platforms like Mendix are embedded and reliable tools in the enterprise. Tools you can use to make your organization to be more adaptable and evolve your business model.

In the 2021 Strategic Roadmap For The Composable Future Of Applications, Gartner stated, “by 2023, 30% of new applications will be delivered, priced and consumed as libraries of packaged business capabilities, up from less than 5% in 2020.” In three years, that’s just 25 percent growth – imagine what that landscape will look like in five.

Low-code in action

PostNL is the Netherlands’ national postal carrier. The company delivers an average of 8.1 million letters and 1.1 million parcels a day. Their old monolithic system, architected to service a max of 600,000 daily packages, struggled to meet the increasing demands sparked by massive e-commerce growth and was not capable of evolving to meet new capacity expectations.

They worked with Mendix partner Cape Groep to build a new order management system with low-code. PostNL and Cape Groep cleared a two-year backlog in just six months and delivered a new system that could meet current demands and scale as needs increased.

The new systems run on 64 microservices and can be customized to meet the changing needs of both individual sorting centers and their customers. Previously making and testing changes to their system would take months. Now they can quickly enable new customer features – like changing delivery times or requesting special care for medical packages.
PostNL initially wanted to solve a logistics problem – they needed a flexible system to handle growing demand. They built precisely that and also changed their business model in the process – they are now a tech-driven organization with the capacity to iterate and evolve at the pace their customers expect.

CX is the new black

The value of investing in customer experience is there for the taking. The enterprise is making every effort to address customer experience, but very few are succeeding. You have a rare opportunity to get innovative and up your digital game so you can start providing the best customer experience your industry has to offer. Establishing your organization’s digital ecosystem will enable the adaptability you’ll need not just to be competitive – but to set the standard for what a truly digital company can achieve.

If you’re thinking, “We’re fine the way we are, we’re doing the best we can, we’re already dominating our industry.” Blockbuster and taxi unions were thinking along those lines when they dismissed upstarts like Netflix and Uber.

How customers experience and interact with your product and digital landscape has a ripple effect beyond just affecting your customers’ perception of your brand. Ensuring that you can constantly improve and iterate on your customer experience requires impactful and intense organizational changes. But it’s worth it – investing in customer experience has never been more potentially profitable or differentiating.

Don’t wait.

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