Developing a Customer Experience

VisionRon Ritter and Will Enger

PrincipalMcKinsey & Company

Will EngerAssociate Principal, McKinsey & Company

6 Years of experience with McKinsey & company’s Dallas officeCross-industry experience in customer experience transformations Prior experience in the U.S. ArmyMBA from Univ. of Pennsylvania, B.S. from the United States Military Academy

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Ron RitterPrincipal, McKinsey & Company

17 years of experience with McKinsey & Company in the Miami officeExpert in large scale transformations involving operations and customer experienceServed as Special Assistant to the Secretary of the Air Force, US DoD from 2006 to 2009,Ph.D. from Oxford University, (Rhodes Scholar), B.S. from the University of Miami (FL)

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Your company’s culture drives it’s performance….

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Average Total Return to Shareholders (TRS)Strength of culture Average TRS per year

9

16

26

Average

Strong

Weak

3X Higher TRS scores for companies that have strong cultures vs. who do not

This translates into ~$1.2B difference in value for an average sized company

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…. and most transformations fail to address it

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Only 30% of transformations succeedWhy do 70% fail?

72%

28%

Financial and other obstacles

Employee resistance to change and unsupportive leader behaviors

One organization used culture to drive success

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▪ Security anxiety increases airport crowding, wait times

▪ Increased passenger volume stresses capacity of the facility

▪ Other airports and local attractions raised the bar, changing the frame of reference

20% decline in passenger CSATDouble-digit decline in industry rankings

A challenging operating environment drove decreased customer satisfaction

▪ Cross-stakeholder development of Customer Experience Vision

▪ Rigorous quantification of what matters to passengers to inform aspiration

▪ Governance and ‘test and try’ programs put in place to keep employees engaged

Top 10 industry ranking within 2 years14% improvement in retail revenues

Two –year transformation centered on the passenger experience

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Let’s talk about how they did it©

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McKinsey’s core beliefs on customer experienceHow to: defining the aspiration, creating a shared vision, cascading and reinforcing the messageUse of ‘wow moments’ to reinforce cultureCustomer vision case studies

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Setting the customer experience vision is a critical component of a transformation

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Reinvent customer journeys using digital technologies

Develop a deep understanding of what matters to customers

Use behavioral psychology to manage customer’s expectations

Use customer journeys to empower the frontline

To improve constantly, establish metrics and a governance system

Define a clear customer-experience aspiration and common purpose

CustomerJourneys

1

CEmetric

Journeys experience assessment

Operational KPI Indicators

Organizational and cultural foundati on

Employee feedback

CE measurement pyramid

2

3

4

5

6

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The aspiration and common purpose link the brand strategy directly to front line behaviors

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Common factbase of current state

Brand strategy and value proposition

Aspiration (informed by current state)

Common purpose

Standards for service

Day-to-day employee required behaviors

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What they didInvested two months to build a common passenger fact basePrioritized the most important drivers of passenger satisfactionUnderstood current state of employees from across the ecosystemTook risk and thought big

Understand which customer Journeys matterDecide were CX can competitively differentiate Don’t forget the employee diagnostic

Takeaways

First, the airport defined the aspiration©

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Next, the airport purposefully aligned leadership

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Identify the most influential 60 leaders across the ecosystemDevoted 2 days in person

Everyone was equally heardStayed consistent with the tradition of the brand

Aligned on a one-sentence version of the customer vision

What they did

Get the right leaders in the room and commit the timeGive people safe space to debate, discuss, and emotionally commit Stay simple and authentic

Takeaways

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Finally, the airport cascaded the vision©

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What they did

Leaders must purposefully communicate the visionLink the vision to what individual employees must do differently each dayUse positive reinforcement

TakeawaysCreated four principles to apply the vision to daily operationsDefined observable behaviors that meshed with the visionCreated employee-led training, communication, and recognition teams

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Engineer ‘wow’ moments to supportthe transformation

Health insurance

Utilities

Pay TV

Bank 25.7

Hotel 26.3

Health care providers 28.2

Percent of customers “strongly agreeing” to having an experience that surpassed expectations

1 Defined as customers responding with score of 10

IndustryCustomers “strongly agreeing”1

% of customers CSAT Average Score“Strongly Agree” customers

SOURCE: 2015 McKinsey Cross-Industry Customer Experience Survey, June & July 2015, Question DL1

Industries creating “Wow” moments for customers

14.1

15.7

18.7

B

$$

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9.5

9.6

9.7

9.6

9.6

9.6

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Case example: Financial institution©

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StandardsSecurity: Ensure you peace of mind

Closeness: build an emotional connection

Diligence: give advice and deliver “right first time”

Image: Live our values in all actions

Example employee behaviors

I protect the assets of the bank and its customersI care for the safety of information

I put myself in the other’s positionI take responsibility for all of my customers’ requirementsI always have a positive attitude

I honor my commitments in due time and mannerMy work is always right first time, minimizing errors and being attentive to detail

My actions are consistent with our values: respect, excellence, integrityMy worksite is always neat

Customer experience vision

“We make dreams come true by developing trust-based relationships during the entire lives of our customers”

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Case example: Airport©

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Standards

Safety: Look out for safety and well-being of guests and employees

Comfort: Create a clean space free of physical and mental stress

Ease: Make the experience simple and courteous

Speed: Remove the perception of inefficiency and delay

Example employee behaviors

Remain mindful of surround-ings and stop unsafe behaviors

Pick up trash or report an area that needs attention

Display appropriate body language and use a calm tone of voiceMake eye contact and smile

Stop and proactively offer assistance to next step in the journey

Customer experience vision

“To delight and value each guest with the finest airport experience in the world”

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Create simple behaviors and recognize employees that are doing it right

CLIENT EXAMPLE

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Questions