Friday Apr 10, 2015

3 Steps to a Modern Profitable Service Organization by Jeff Griebeler, CX Strategist

Transitioning your support organization or contact center from a cost center to a profit center is an onerous process that can be difficult to navigate. Yet, it is a journey that must be purposely undertaken, performed crisply and executed successfully to thrive in the competitive world. Being viewed as a cost center creates an endless journey of continuous cost cutting, funding reduction, and the need to always be more efficient this year than last. It is a self-destructive cycle that ends with an underfunded support organization attempting to provide ever increasing services to an ever demanding customer community in an ever more competitive market. The historical mantra has been simple: “do more with less;” when the discussion should be focused on creating organizational value, defining competitive differentiation, creating loyal customers, and promoting profitable growth.

Becoming Trapped

Many companies have viewed their support organization as a necessity to remain in business. The view was simple: “customers will not buy without support, but customers do not buy because of support.” Support was a necessity and delivered at a minimal level and at the lowest possible cost. These organizations are funded on a cost-budget basis, and share these characteristics:

  • Provide more support with less budget
  • Offer more channels with minimal funding
  • Stretch technology far beyond its useful life
  • Use siloed applications as band-aids

Efficiency has its limits and frequently has adverse effects. The maximum efficiency that can be gained is limited by the total budget. Additionally, efficiency improvements can be captured only once and become part of next year’s baseline budget.

As budgets are cut year-after-year to provide additional margin to the organization, the quality of support diminishes, technologies age and workaround processes become more prevalent, which result in more inefficiencies. Personnel become frustrated, customers become frustrated and you fall behind your competitors. Cheap, quick, easy siloed technologies are implemented on a temporary basis; but temporary, all too frequently, becomes permanent. It creates a vicious circle spiraling downward and the organization is trapped.

Under Attack

The “trapped customer support organization” comes under attack on multiple fronts:

  1. Enlightened competition providing better customer service start taking market share
  2. Customers, empowered by easy-to-obtain, readily available information and the ability to socially broadcast their experience, increase their demands
  3. Increased competition for scarce internal funding. Cost-based organizations fall to the bottom of the budget list and are “designated for investment next year,” but next year turns into the following year, and so on.

Over time, these forces take their toll on the organization as it slips further and further behind the competition and industry service standards.

The CX Value Equation

To escape the trap, an economic framework must be established to measure and illustrate value. The measured value made by customer service must be considered across three major areas: Efficiency (E), Retention (R), and Acquisition (A). When combined, we refer to this as the CX Value Equation:

CX = E + R + A

Efficiency allows an organization to do more with less;
Retention is the ability of an organization to keep and grow the customers it already has; and
Acquisition refers to the ability of an organization to increase its customer base.

The CX Value Equation effectively defines a financial bridge between a CX customer service strategy and the organization’s profit line. With a defined CX Value Equation, you have a tool to illustrate the service organization’s contribution and progress. You are now ready to transform your organization from a cost center to a profit center.

Three Steps to a Modern, Profitable Service Organization

The key to transforming your organization is to modernize its capabilities so you can capture and illustrate the benefits. Here are the steps to modernize your organization and turn it into a profit center:

Step 1: Set CX Value Equation Metrics and Baseline Your Service Organization
Start with efficiency metrics. These are the easiest to identify. Get a handle on the important ones, such as self-service and first contact resolution rates. Add retention metrics to the model. Great candidate metrics include Customer Effort Score (CES) and Net Promoter Score (NPS). Finally, add acquisition measurements with metrics like the number of opportunities and referral rates.

For further information, please consult Customer Experience (CX) Metrics and Key Performance Indicators, an Oracle White Paper.  

Once your model is designed, baseline your current operational performance. This is your starting point from which you will demonstrate your progress and contribution to the organization.

Step 2: Modernize Your Service Organization
Use the Roadmap to Modern Customer Service Strategy to move from a cost center to a profit center. When this strategy is followed, the activity can be a self-funding.

Start by establishing a proper capabilities foundation. Then add new capabilities and provide consistency across all interactions. Finally, drive continuous innovation to remain ahead of the competition. The foundational activities are how you get going. You must resist the urge to skip steps and attempt to implement innovation on top of your outdated infrastructure. This will only lead to failure. Skipping steps is how an organization ends up with disparate systems (e.g. stand-alone chat) and business processes that function poorly, deliver substandard service, and require manual support and workaround processes to operate – hardly an effective strategy.

Let’s lay out the steps:

  • GET GOING to save budget and generate cost savings that support investments to
  • GET BETTER and improve retention with consistent quality of service, optimized capabilities and strengthened relationships, so you can
  • GET AHEAD to create revenues by monetizing more opportunities, personalizing interactions and being proactive in an omni-channel environment

Step 3: Continue to Measure, Demonstrate and Evolve
Modern customer service is not a destination, but rather an evolving journey. This year’s customer service capabilities become table stakes for providing service next year. Customer needs and demands will continuously change. Market forces will change. Technology will change. The Internet of Things (IoT) is upon us, and will accelerate change.


Liberating your cost-centric customer support organization can feel like an impossible task. However, by leveraging the CX Value Equation and tailoring it to your needs, you can demonstrate the true value of the services you provide to your organization. By using the Roadmap to Modern Customer Service’s strategy: Get Going, Get Better, Get Ahead approach, you can self-fund and transform your center from an entity that is viewed as “overhead” or a “necessity” into a strategic, competitive asset that generates revenues and profits.

Click here to read the full whitepaper.

Tuesday Nov 05, 2013

7 Reasons for Abandonment in eCommerce and the need for Contextual Support by David Fulton

Shopper confidence, or more accurately the lack thereof, is the bane of the online retailer. There are a number of questions that influence whether a shopper completes a transaction, and all of those attributes revolve around knowledge. What products are available? What products are on offer? What would be the cost of the transaction? What are my options for delivery? In general, most online businesses do a good job of answering basic questions around the products as the shopper engages in the online journey, navigating the product catalog and working through the checkout process. The needs that are harder to address for the shopper are those that are less concerned with product specifics and more concerned with deciding whether the transaction met their needs and delivered value.

A recent study by the Baymard Institute [1] finds that more than 60% of ecommerce site visitors will abandon their shopping cart. The study also identifies seven reasons for abandonment out of the commerce process [2]. Most of those reasons come down to poor usability within the commerce experience.

  1. Distractions. External distractions within the shopper’s external environment (TV, Children, Pets, etc.) or distractions on the eCommerce page can drive shopper abandonment. Ideally, the selection and check-out process should be straightforward. One common distraction is to drive the shopper away from the task at hand through pop-ups or re-directs. The shopper engaging with support information in the checkout process should not be directed away from the page to consume support. Though confidence may improve, the distraction also means abandonment may increase.
  2. Poor Usability. When the experience gets more complicated, buyer’s remorse can set in. While knowledge drives confidence, a lack of understanding erodes it. Therefore it is important that the commerce process is streamlined. In some cases, the number of clicks to complete a purchase is lengthy and unavoidable. In these situations, it is vital to ensure that the complexity of your experience can be explained with contextual support to avoid abandonment. If you can illustrate the solution to a complex action while the user is engaged in that action and address customer frustrations with your checkout process before they arise, you can decrease abandonment.
  3. Fraud. The perception of potential fraud can be enough to deter a buyer. Does your site look credible? Can shoppers trust your brand? Providing answers on the security of your experience and the levels of protection applied to profile information may play as big a role in ensuring the sale, as does the support you provide on the product offerings and purchasing process.
  4. Does it fit? If it is a clothing item or oversized furniture item, another common form of abandonment is for the shopper to question whether the item can be worn by the intended user. Providing information on the sizing applied to clothing, physical dimensions, and limitations on delivery/returns of oversized items will also assist the sale. A photo alone of the item will help, as it answers some of those questions, but won’t assuage all customer concerns about sizing and fit.
  5. Sometimes the customer doesn’t want to buy. Prospective buyers might be browsing through your catalog to kill time, or just might not have the money to purchase the item! You are unlikely to provide any information in contextual support to increase the likelihood to buy if the shopper already has no intentions of doing so. The customer will still likely abandon. Ensuring that any questions are proactively answered as they browse through your site can only increase their likelihood to return and buy at a future date.
  6. Can’t Buy. Errors or complexity at checkout can be another major cause of abandonment. Good contextual support is unlikely to help with severe errors caused by technical issues on your site, but it will have a big impact on customers struggling with complexity in the checkout process and needing a question answered prior to completing the sale. Embedded support within the checkout process to patiently explain how to complete a task will help increase conversion rates.
  7. Additional Costs. Tax, shipping and other costs or duties can dramatically increase the cost of the purchase and when unexpected, can increase abandonment, particularly if they can’t be adequately explained. Again, a lack of knowledge erodes confidence in the purchase, and cost concerns in particular, erode the perception of your brand’s trustworthiness. Again, providing information on what costs are additive and why they are being levied can decrease the likelihood that the customer will abandon out of the experience.

Knowledge drives confidence and confidence drives conversion. If you’d like to understand best practices in providing contextual customer support in eCommerce to provide your shoppers with confidence, download the Oracle Cloud Service and Oracle Commerce - Contextual Support in Commerce White Paper. This white paper discusses the process of adding customer support, including a suggested process for finding where knowledge has the most influence on your shoppers and practical step-by-step illustrations on how contextual self-service can be added to your online commerce experience.





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