Customer Effort Score is only one-sixth of a total service experience

By David Conway, Chief Strategy Officer, Nunwood

http://www.customerexperiencemagazine.org/Issue12/DavidConway.html

The July 2010 Harvard Business Review article ‘Stop Trying to Delight Your Customers’, introduced a new measure to the field of customer experience measurement - the Customer Effort Score (CES) and the last issue of Customer Experience Magazine, discussing the pros and cons of this measure, raised a lot of discussions.  

Its proponents claim it’s more predictive of future consumer behaviour than higher order measures such as CSAT and NPS.

They propose that focusing deliberately on it will “improve customer service, reduce customer service costs and decrease customer churn”. 

The promises attributed to this singular focus have resonated strongly across customer experience teams - there is no doubt effort is an interesting metric; it plays to the rapid results demands of our times, is straightforward to implement and elegantly simple in design.

However, like NPS before, it is the simplicity of the measure that has caused controversy. Few critics have problems with the measure per se. They struggle with a measure that excludes product, price, brand and the competitive environment being cited as the primary determinant of customer loyalty. 

This conjecture begs the question as to how should organisations best structure their customer experience measurement approach.

Research conducted as part of the Nunwood Customer Experience Excellence Programme, involving over 500,000 customer evaluations of their experiences with 500 global brands, examines how leading organisations achieve customer experience excellence - and how that translates into advocacy and repurchase. 

The research shows that in addition to product, price and brand, there are six factors that influence loyalty and repurchase, one of which is customer effort. The commercial contribution of each of these six factors varies across business and industry.

However the excellent organisations consistently deliver against all six:

Personalisation – the degree to which an experience meets specific needs;

Time and effort – valuing customer time and reducing effort to make the interaction easy;

Resolution – turning a poor experience into a great one;

Expectations – the setting and delivery against implicit and explicit promises;

Integrity – putting customer well being ahead of profit; and

Empathy – understanding the customer’s unique circumstances and responding accordingly.

To understand why getting all of these factors right is vital to a competitively superior experience, we need to consider how these factors arise during a typical customer journey.

This journey example is one small part of an actual mortgage application process, yet each of the six factors feature at essential points in the journey.

On a number of occasions more than one of the factors is necessary for the satisfactory completion of that step.

The message from our study is clear; the top companies excel by solving all of these areas. They do not solve these problems individually - each is interconnected. So if an organisation fails to solve any one of them, they cease to be excellent. 

It’s their management of the ‘interconnectedness’ that sets them apart. The complexity of managing interconnections explains why customer experience excellence is so challenging. 

The Anna Karenina Principle, known to statisticians and scientists, states that in complex environments no one property guarantees success, but many guarantee failure. Success requires avoiding multiple causes of failure because if only one is avoided there will be no success. 

The Principle draws its name from Leo Tolstoy’s book of the same name, the opening line of which states: “Happy families are all alike; every unhappy family is unhappy in its own way”.

Tolstoy meant that for a marriage to be happy it had to succeed in several key aspects. Failure in any of the aspects and the marriage is doomed.

From a customer experience perspective our research upholds the principle; all effective customer experience organisations are alike, but all ineffective organisations are ineffective in their own way.

Reliance on a single factor such as customer effort may or may not be part of a company’s route map. In any event, relying on the customer effort score alone will fail to accommodate the entirety of the customer experience and the myriad of factors that influence loyalty. 

Furthermore, excelling at customer effort whilst failing in any of the other factors will, as the principle outlines, lead to failure.

This suggests that rather than focusing on one aspect of measurement, organisations need to develop a diagnostic framework whose sophistication matches the complexity of customer experience delivery.

It needs to be able to separate symptoms from root causes, mirror the interconnectedness of different attributes and monitor each of the six factors to ensure the failure of one doesn’t undermine.

There are three key phases to the diagnostic framework:

1) Pilot the high-level metric whether a key driver composite measure, NPS, CSAT or Customer Effort, against one or more challengers to ensure the metric works in your company’s setting.

2) Identify a small number of key driver attributes that sign post success or provide early warning of multiple failure. Use this data to rapidly diagnose sudden shifts or changes in the high-level metric.

3) Collect free text or verbatim comments. Test open questions to identify which ones yield rich, anecdotal, sentiment-infused responses suitable for text mining. Use text mining software to rapidly theme and code responses. Use total quality management techniques such as Ishikawa diagrams to surface complex inter-related root causes.

The benefit of measuring customer effort is not in question, nor is the philosophic point on fixing the basics before seeking to delight. However, the score is a micro measure one-sixth of a total service experience. Macro measures such as CSAT and NPS, by their nature, tend to take all six factors and their interconnectedness into account. 

The author’s contention that customer effort is strongly correlated with future loyalty may be true for event-based surveys in certain industries.

Behavioural economics teaches us that recent experiences have a disproportionate impact on future behavioural intentions. But in our experience it is not true for customers who have not had a recent experience, which for most companies is the majority of their customer populations.

The research shows that macro measures do a better job of predicting loyalty across the entire customer base.

It is human nature that we look to single-order, single-factor explanations of success. However, the research conducted as part of the Nunwood Customer Experience Excellence Programme shows that for customer experience, as in so many aspects of life, there is no silver bullet.

Customer experience programmes are only effective if they succeed in many areas. The customer effort score is an interesting measure and one that would add value to any customer experience programme.

But to use it as the single, definitive lens into the customer experience could be catastrophically limiting.