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PegaSystems Shares Customer Experience Lessons

We’ve gotten another CRM software publisher perspective on Customer Experience—and in particular how the publisher’s customers are approaching them with increased questions, requests and objectives around CX. In this case the CRM software maker is Pegasystems (Pega) and over conversations with Steve Kraus, Senior Director of CRM Product Marketing, and Brian Callahan, Director of Communications, I was given another outlook on how some of the largest enterprise companies are linking their CRM software with new found CX objectives.

Pega Customers Pursuit of Customer Experience

Pega shares that Customer Experience objectives are an increasing trend from its customer base—as Pega customers want to know how to get the most value from their customers. But as noted in prior discussions with Oracle and SAP, many times these buyers are the CMO, customer service head or head of sales. These positions are certainly influential in achieving CX objectives, however, as CX is not a departmental strategy, challenges are certain to impede progress if the initiative isn’t driven at an enterprise level by the CEO or President, or maybe the COO or CCO, as alignment among priorities, processes and systems is a critical success factor to orchestrate customer processes across departments or business units.

The company also notes a subtle but profound change in terminology. Suggesting some lessons learned from the past, customers are often using the phrases “customer relationship management” (CRM) and “managing relationships with customers” as two distinctly different things; with the former CRM phrase being largely technology-oriented versus the second phrase being more relationship/process oriented and being followed with a discussion of CX and customer-centric strategy.

While working with customers, Pega executives find that an evolving definition of CX is similarly changing the objectives. While commonly touted disruptive technologies such as social, mobile, geo/location and others remain relevant, customers are increasingly recognizing these are tools or means to the end, not the end goal itself. According to Pega, customers are increasingly adopting new end goals which are far more customer centric—such as customer satisfaction, NPS (Net Promoter Score) or CLV (Customer Lifetime Value).

As CX objectives get more tactical they also begin to vary more by vertical market. For example, retail banks that seek increased customer or wallet share know that higher levels of service during the first 90-120 days will result in new clients extending their relationships. Their efforts to promote strong onboarding practices and deliver a seamless and differentiated customer experience during the honeymoon period will grow customer share. Similarly, insurance and healthcare providers know to focus on claims efficiency and making a complex or document intensive process simple and seamless in order to retain more customers. Telcos know to focus on fast problem resolution to keep customers and meet customer retention goals. They also know they can leverage customer analytics to suggest when a customer shows potential or is likely to defect – and can use that knowledge to intervene with a reward or promotion.

Working backwards from customer centric goals also demands a change in performance metrics. Business performance must include metrics which customers’ deem important. This isn’t to say that traditional CRM and customer management metrics which cater to business efficiency and cost controls are eradicated, but at best they must be balanced with measures customers value if the company expects to yield longer term relationships and benefits from those customers. And be clear, customers don’t care about contact center AHC (average handling time) or their CLV, they care about getting their issues resolved fully, accurately and timely, and being treated as the company’s best customer.

The process becomes even more complex when recognizing that the evolution from company-oriented, inside-out metrics to customer-oriented, outside-in measures also mandates changes to company culture, departmental priorities, compensation and incentive systems, and internal systems. In fact from the CRM systems perspective, most organizations will find that they implemented systems for departmental objectives; not enterprise-wide or customer-centric process objectives, and therefore may require a step back before simply tweaking existing systems. Nobody ever said creating a customer-centric business was easy; but that’s also why it delivers such a compelling competitive advantage for those businesses that get it right.

Pega & The Enterprise Market

Pega’s customer market represents a unique slice of the broader CRM market. Pega’s target market consists of the Fortune 500, and in large part the larger half of that segment. The bulk of the company’s customers are B2C and Pega seeks out complex enterprises where it can apply its signature strengths of Business Process Management (BPM) and analytics. As with most CRM providers delivering large scale CRM systems to global companies, Pega customers are largely using on-premise CRM software, but that balance is steadily changing toward hybrid and pure cloud deployments.

Customer experience business strategies are nascent and there are few best practices or out-of-the box software capabilities available. To aid customers in their pursuit of CX objectives, the company generally works with its clients to identify and prioritize the most significant opportunities or challenges and then crafts software automation methods to solve specific customer problems. More often than not, the application of CRM software to enable CX strategies involves much more than just tuning traditional customer processes, and in fact involves redesigning application workflow around cross-departmental customer processes.

Pega echoes what consultants have long preached, which is for most organizations, as much as 80 percent of business processes are similar across companies and easily accommodated. However, it’s that last 20 percent that benefits from custom business process alignment, gives customers what they’re looking for and gives companies their competitive advantage.

For Pega, the software process may begin with business intelligence, and leveraging the analytics to discover what customers actually do or where gaps exist. From this data driven vantage point, the company can then implement business process management automation for case management, multi-channel management or whatever process is deemed necessary.

From a software technology perspective, Pega uses what it calls a “situational layer cake” framework, which is essentially an agile approach to define customer standards at a global level, and then solve specific problems by applying incremental components or solutions. This permits customers to begin with smaller scope projects, show early success and build momentum along the way.

Social CRM & CX—The Impetus and the Cure

Pega notes that CX may be a heightened interest and business objective in part due to the rise of social media and extremely vocal social customers. Today’s social networks and social channels can broadcast poor customer service scenarios like no method prior, thereby increasing the risk of delivering a bad customer experience by orders of magnitude. While most customers are normally quite reasonable and will tolerate occasional human mistakes, they are not so forgiving for process-oriented mistakes which replicate poor customer service or frustrate customers with scale. As social media continues its meteoric rise, both the risks and rewards of delivering a consistent and differentiated customer service will accelerate and deliver business impact to the delight or the detriment of the businesses providing those services. End

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Author  Author: Chuck Schaeffer
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For most organizations, as much as 80% of business processes are similar across companies and easily accommodated. However, it’s that last 20% that benefits from custom business process alignment, gives customers what they’re looking for and gives companies their competitive advantage.

 

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