Customer Experience

A New Model for Better Customer Experience

Oracle’s ESP maturity model creates a framework for transformation based on efficiency, scale, and profit.

By Jim Napier and Christian Patrik, Oracle Value Services Group

June 2018

As the number of channels on which customers can interact with a business has increased, customer engagement has become more complicated. Today, customers can pick up a phone, join an online chat, send an email, tweet, post on Facebook—the possibilities are numerous. Expectations increase as technology advances, with customers demanding more information, faster response times, and personalized experiences.

Customers are placing immense scrutiny on the way companies deliver customer experience. Companies that lag in developing a holistic customer experience are at risk of losing customers. Accenture estimates that the cost of customers switching due to poor service is $1.6 trillion in the US alone. Through social media, bad customer experiences propagate. According to Dimensional Research, 54% of people who share bad experiences share them with five or more other people.

When working with companies to develop strategies for a better customer experience, the Oracle Value Services Group uses a model that is based on three stages of maturity: efficiency, scale, and profit. The model, called ESP for short, allows companies to engage the entire enterprise to develop a logical roadmap that aligns objectives, capabilities, and metrics. Acknowledging that optimizing the customer experience is a process, the model forces companies to realistically assess their current capabilities and build upon them in a way that maximizes return on investment.

Before Getting Started: Engage the Enterprise

Leading companies recognize that although customer experience was once the exclusive domain of customer service, today, optimizing the customer experience requires the engagement of the entire enterprise. Marketing, sales, customer service, commerce, fulfillment, and invoicing must participate in designing a great customer experience as they each touch the customer over time. Companies that excel at customer experience grow revenues 4% to 8% faster than average, according to Bain & Company.

We believe that the best way to get cross-functional alignment and commitment is to conduct a series of journey-mapping workshops: high-impact, interactive sessions that map the customer journey from end to end. Before you start thinking about transformation, it is important to understand your customers, their experience during every interaction, and their emotional responses to these interactions. Through journey mapping, the cross-functional participants develop a mutual understanding of customer attitudes and needs. This understanding serves as a springboard to developing high-impact customer experience strategies and roadmaps through the application of the ESP model.

Efficiency Stage: Build a Scalable Foundation

In this stage, the main objective is to create a foundation that allows companies to enhance their efficiency—doing things better, cheaper, and faster. By focusing on simplifying and streamlining processes, the efficiency stage results in an enterprise that is prepared for sustained growth. Other supporting objectives for this stage are improving response times, lowering costs, and ensuring sustainability. Companies mastering this stage have eliminated manual processes, introduced a unified data model, and created the ability to engage customers quickly and easily across channels. Investments made in this stage include an enterprise-wide customer experience foundation, knowledge management, web self-service, chat, and intelligent routing.

For example, we worked with a Silicon Valley-based 3D-printing company that figured out the key to success: focus the majority of your effort on optimizing the processes that distinguish your firm in the marketplace. By selecting a scalable, integrated cloud enterprise application, the company was able to implement 200 processes in only six months, but the company spent most of its time understanding, developing, and deploying the 10 processes that affected its customers’ experience; the remainder were used straight out of the box. This resulted in organizational alignment between its customer journeys and processes and its customers’ needs, which was measured through lowered call volumes and cost per resolution.

Scale Stage: Deliver a Consistent, Relevant, Quality Engagement

In this stage, companies are expanding on the accomplishments from the efficiency stage to thoughtfully and holistically manage the customer experience across all channels. By providing consistent, relevant quality engagement across all channels, companies achieve the objectives of this stage: optimizing investments, driving customer insights, and influencing behaviors (both internally and externally). Companies mastering this stage are informed, nimble, and able to adapt to changes in strategy or customer needs. Investments made in this stage include customer data management, advanced configuration and pricing, guided selling, real-time personalization, and social listening.

Because customer service is a powerful source of differentiation, the 3D-printing company enhanced, yet simplified, its approach to service by aligning with its customers’ business needs. Maximizing machine availability and print quality was achieved by having machines create their own trouble tickets. The tickets are communicated directly to customer service, where they are triaged, and techs are deployed often before the customer knows there is a problem. This capability was enabled through the use of a common enterprise platform that incorporates finance, supply chain, customer service, and human capital management. All customer data is immediately available across all channels, departments, and users. This resulted in the ability to review and react to customer issues from all of the touchpoints within the organization.

Profit Stage: Lead with Personalized, Transformational Experiences

The final stage of the maturity model is profit. Within this stage, organizations are focusing on highly personalized and transformational practices. The objectives for this stage are accelerating revenue, increasing opportunities, and forming leading business practices. With the foundation and insights gained through the first two stages, companies can focus on disruptive market innovations. Through engagement of the entire enterprise, they can proactively anticipate customer needs and develop and market products and services to meet those needs. Investments made in this stage include adaptive intelligence, hyper-personalization, Internet of Things, machine learning, and enterprise performance management.

By creating a predictive service model that is closely aligned with engineering, this 3D-printing company has changed the way it works with its customers. Over 70% of repairs are now predicted, all trouble tickets are reviewed by engineering, and software enhancements for machines are deployed automatically. This has resulted in the deployment of higher-quality equipment and higher rates of customer loyalty.

Inspect What You Expect

Metrics are the bedrock for any strategy. The ESP framework uses metrics that are meaningful, relevant, and aligned with the objectives of each maturity stage.

Here are some examples of customer experience metrics that could be used in each maturity stage:

Stage Examples of Metrics
Efficiency Cost per resolution, average handle time, call volume
Scale First-contact resolution, customer retention rate, Net Promoter Score (NPS)
Profit Average order value, customer lifetime value, cost of acquisition

But metrics aren’t enough; they need to be evaluated relative to benchmarks. Without benchmarks, it is impossible to objectively assess your progress.

Get Going, Get Better, Get Ahead

Jim Napier

Jim Napier, Oracle Value Services Group

Christian Patrik

Christian Patrik, Oracle Value Services Group

With the ESP maturity model, companies can objectively engage the enterprise to develop roadmaps to align their capabilities with their business strategy and customer expectations. In today’s competitive and fast-changing markets, these roadmaps must be practical, innovative, and ultimately transformational. Incorporating relevant and meaningful metrics ensures companies keep their eye on where they’re going as they progress.

Companies using the ESP framework develop strategies that are better aligned with customer needs, experience higher enterprise adoption rates, and more quickly realize value from their investments.

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