Executive Summary

Over the past several years, organizations have made big investments in enterprise feedback management (EFM) systems (aka platforms or portals) designed to save money and “digitally transform” their customer experience (CX) programs. While the EFM software looks compelling in sales presentations, too often these products have failed to live up to the promise—even after companies spent a year or more to install the software and up to three years to fully implement the system.

Disappointments have centered around the true “all in” cost of implementation, issues with online methodologies (biased samples, quota management) and the inability of software firms to drive behavioral change across the organization.

What these companies are discovering is that EFM “solutions” are not really solutions at all—they are software tools. To actually realize expected ROI on EFM initiatives, organizations must implement them as part of broader CX strategies that integrate actionable data into workflows in a manner that drives behavior and changes the culture.

Because few organizations have the internal expertise needed to achieve those goals, specialized customer experience consultants are emerging as a key resource in achieving expected returns on EFM investments and CX initiatives.

Executive Summary

Over the past several years, organizations have made big investments in enterprise feedback management (EFM) systems (aka platforms or portals) designed to save money and “digitally transform” their customer experience (CX) programs. While the EFM software looks compelling in sales presentations, too often these products have failed to live up to the promise—even after companies spent a year or more to install the software and up to three years to fully implement the system.

Disappointments have centered around the true “all in” cost of implementation, issues with online methodologies (biased samples, quota management) and the inability of software firms to drive behavioral change across the organization.

What these companies are discovering is that EFM “solutions” are not really solutions at all—they are software tools. To actually realize expected ROI on EFM initiatives, organizations must implement them as part of broader CX strategies that integrate actionable data into workflows in a manner that drives behavior and changes the culture.

Because few organizations have the internal expertise needed to achieve those goals, specialized customer experience consultants are emerging as a key resource in achieving expected returns on EFM investments and CX initiatives.

Introduction

A decade into the customer experience revolution, companies are asking, “I’ve gone digital, now what?”

Organizations have been adopting customer experience as a core strategic imperative to differentiate themselves and to grow their business. Nearly 90% of U.S. companies say they intend to compete mainly on the basis of customer service. The one snag in these plans: Fewer than half of those companies rate their own customer service as exceptional.

The fact that two-thirds of companies expect their customer service to climb to “exceptional” levels in the next two years suggests these companies are banking heavily on significant improvement. In all likelihood, they are relying on a CX program to achieve this goal.

Over the past five years, however, many CX leaders have realized these programs are not delivering expected results. Companies cite several reasons for the shortcomings, including challenges in data collection, underutilized reporting and a lack of automated analytics that assess changes in the customer experience over time and measure how well or how poorly the organization has been responding to customer feedback.

The industry responded to these complaints with today’s EFM portal software—centralized systems that facilitate the collection, distribution and analysis of customer feedback data. These systems were intended to revolutionize CX data collection and management by integrating new digital tools ranging from pop-up online surveys and automatic email follow-up, to sophisticated reporting, distribution and analytics.

By leveraging these and other digital tools, EFM systems are intended to make customer experience programs cheaper to run, easier to manage and more effective in delivering meaningful operational results.

A Disappointing Revolution

Companies were impressed with this new software, and many have invested millions of dollars in EFM solutions. Today, half of Fortune 100 companies have implemented EFM tools¹. But for many of these organizations, EFM has failed to live up to expectations.

Some of this disappointment will be familiar to anyone who has lived through a major software implementation. EFM portals can be both difficult to implement and disruptive. Most EFM solutions take more than a year to install, despite assurances from some providers that the process will be much quicker. Implementation is also disruptive to workflows. After tough EFM implementations, some CX leaders have said they felt as if their organizations partnered with technology providers, as opposed to customer experience experts.

But a company’s frustration with EFM often goes well beyond implementation headaches. Even after mastering the new technology that allows them to quickly create, execute, analyze, and report customer surveys and results, many companies fail to realize expected benefits or achieve target returns on their EFM investment. This is a more fundamental failing that, at first glance, calls into question the efficacy of EFM and perhaps even CX as a whole. But it shouldn’t.

The disappointing results experienced by EFM customers are attributable almost entirely to their failure to realize that implementing an EFM solution is merely the first step. What companies are discovering is that the end product of EFM is not organizational change, it is data. And data is just the beginning of a best-in-class CX program.

Trying To Do It All

Companies that first adopted the customer experience as an organizational imperative quickly learned that operating a comprehensive “voice of the customer” program involves complex challenges and that no single silver bullet exists to make it all work. Among the key challenges: determining what data should be collected, managing the data collection process, producing unified reporting and analytics, and coaching employees on specific actions to change customer opinions and drive cultural change in the organization.

EFM vendors claimed they could simplify these processes by giving customer experience professionals a central system for feedback collection, analysis and reporting. CX leaders began to leverage EFMs to service all areas of the customer experience program, including:

  • Administering customer surveys and reducing expenses with market research firms
  • Delivering automated reports with overwhelming amounts of data and hard-to-understand dashboards
  • Supplying tools to conduct analytics
  • Providing channels in which employees can communicate with customers and track organizational response

After integrating EFM into all these functions, however, many companies were still unsatisfied. In some cases, companies’ new ability to easily and quickly survey customers for feedback actually led to frustration on the part of customers. One company received the following email from a customer: “You need direct feedback here—stop bombarding us with these NPS survey requests. It’s distracting and does more harm than good.” Another customer was more succinct: “I’m ok. No more emails please.”

Companies also encountered internal difficulties. They found that in an EFM-only environment, employees receive customer feedback with little understanding of how to take action and improve the customer’s situation. Meanwhile, employees are often held accountable for creating positive customer experiences and for taking appropriate action on feedback.

This gap creates a vicious cycle in which a lack of empowerment leads to unmet expectations that, in turn, lower morale and erode confidence in the process. Ironically, this cycle could actually work to degrade the customer experience if left to fester.

Not surprisingly many companies that implemented EFM systems are experiencing the limitations of data. Reports from EFM customers make clear that, in most cases, the systems they implement do operate as advertised when it comes to administering surveys at a reduced cost, delivering automated reports, supplying basic analytic tools, providing communications, and tracking channels.

But the end result of these functions are data sets and reports. These reports provide insights into how the company is performing and where it needs to improve—but this is only data.

An effective CX program consists of two elements:

  1. Data reflecting the voice of the customer, and
  2. The design, implementation and execution of a strategy that uses those data to achieve positive change in workflows and organizational culture

While a sophisticated EFM package can provide the former, it will not achieve the latter. In most cases neither the EFM provider nor the company itself has the expertise to build the processes required to translate that data into actions that have a meaningful and repeatable positive impact on the customer experience and overall business performance. As a result, the EFM initiative fails to deliver expected benefits or achieve target ROI.

The EFM Hangover Cure

The fact that most companies and providers lack the expertise required to create and implement strategies needed to achieve the full benefits of EFM and CX overall does not mean they should give up on the programs. Instead, companies should partner with CX industry leaders that are EFM software agnostic and can guide the design of CX surveys to ensure the best possible output, help interpret the data, provide industry benchmarks, and facilitate action planning workshops.

Some organizations have successfully leveraged EFM software to enhance the customer experience. Many of these organizations have one thing in common: They are focused on behavioral and cultural change. And to achieve these end goals, they employ an external expert to help create a comprehensive CX strategy that connects EFM data and all customer feedback to specific internal actions that change the way the organization behaves.

Strategies developed by these CX consultants help companies identify and capture the right customer feedback and integrate data with advanced analytics and normative benchmarks. The resulting insights can then be used to create a “closed-loop” system in which specific individuals are tasked with specific actions, and results are monitored and assessed for effectiveness.

Without this closed-loop mindset, invaluable customer data goes unused, companies miss opportunities for response and improvement, and customers who supplied feedback get frustrated at the lack of action. Over time, the entire process slows down. All parties start to understand that their input is not achieving any significant results and they stop actively participating.

Expert CX consultants avoid these outcomes by bringing to the table three unique contributions:

  1. Expert consulting based on robust research, established CX best practices and experience within the client’s industry
  2. Unique data, which in the best case comes from proprietary research that includes benchmarks for performance measurements
  3. Advanced reporting, including best-in-class technology analytics

By applying these capabilities, consultants help organizations move past customer data and build organizational strategies that transform feedback into repeatable actions. These strategies consist of processes that develop a holistic view of the customer experience and ensure employees consistently take the right actions to close the loop on customer issues—thereby creating a culture in which employees have true buy-in.

Only when organizations achieve this level of employee engagement with the CX program will they begin to realize the full benefits of CX.

The end results are compelling. Companies that partner with expert consultants achieve increased ROI on their investments in the form of:

  • Increased customer retention
  • Increased product cross-sell
  • Decreased cost due to a reduction in customer issues, optimized service and enhanced operating performance
  • A measurable and sustainable change in organizational culture

Executives who partnered with expert consultants on CX describe their results. “Our bank measured loyalty for many years, switching vendors every few years to save money or try a new metric,” says the head of retail banking for a community bank. “We never really did anything with the data. Working with the consultant, we now drive action planning and are seeing our customer loyalty scores actually start to improve.”

A CXM executive for a regional bank concurs: “The consultant relationship more than paid for itself in only a few months due to several client relationships we retained by taking quick action on the data.”

Conclusion

Make no mistake: EFM systems play a central role in the comprehensive CX strategies that expert consultants develop to achieve these benefits. A well-designed EFM system acts as the central nervous system of a CX program. It provides the infrastructure for the data collection, distribution and analysis that consultants will build upon to create effective processes for performance improvement and cultural change.

However, the EFM space is crowded and evolving. There are major shifts on the horizon as technology giants enter the market and enterprise feedback management blends with customer and business intelligence.

To make sense of it, CX professionals should look for a consulting partner that can advise them on which EFM system will best meet their needs and can help them implement a best-in-class CX program.

A true consulting partner will help you design a program that lowers costs, allows you to control and configure your data collection, and analyze and report results. But that partner will also understand that a successful EFM implementation is just a start. They will push your organization to design and implement workflow and organizational strategies that optimize the performance of the EFM and deliver robust ROI on the CX program as a whole.