News Feature

Why CIOs and CMOs Need Each Other

February 15, 2006 — CIO —

By Jeffrey F. Rayport

We all know the story: You see an item in a chain store catalog but decide to buy it from the retail store to avoid delivery charges. The retail store clerk, however, cannot find the item and after consulting the store’s product database, tells you it’s no longer available. At home you turn on your PC, find the store’s website, and miraculously locate the product. You order it, but now must wait for UPS to deliver. You get the result, but not in the way or the timeframe you wanted.

Similarly, you dial your credit card issuer, an automated voice-response system answers, and asks that you enter your card number. You dutifully punch in the 15 digits. After a lengthy wait during which you listen to a repetitive recording about how much the company values your business, a live customer service representative finally comes on the line and asks for your 15-digit account number. You tell her you already entered it. She tells you the system did not forward the information. You get the result, but again, not in the way or the timeframe you wanted.

So where does the problem lie? Is this a marketing issue for the CMO or a technology issue for the CIO? Of course the answer is: both.

Indeed, every time you see significant dysfunction in the way a company or brand interacts with its customers, it is not the fault of one corporate function but two—both marketing and technology. The combination of people and technology deployed across multiple service channels fails to provide the basic services you sought, let alone the world class services you expected.

So when will CIOs and CMOs join forces to address these challenges, not from their well-defended functional silos but together? The answer: when both parties take time to fully understand and account for the impact their solutions will have on the consumer.

Slumping Satisfaction, Rising Costs
The pressure is mounting for action. The irony is that companies have gone to heroic lengths and considerable expense to build multiple service channels to meet customers’ needs. These range from retail stores to catalogs, websites, call centers, interactive voice-response units, handheld PDAs and touchscreen kiosks, to name a few. In response, however, customers have grown increasingly frustrated by the lack of coordination and consistency of experience across these touch points.

According to the American Customer Satisfaction Index (ACSI), this proliferation of service channels has created a great deal of sound and fury signifying nothing…but bad news, especially for consumer-facing industries turning to service automation or outsourcing to boost competitiveness. Customer satisfaction has stagnated (and in recent years, declined), while costs of service have risen. In a recent Forrester Research study of 176 North American corporations with revenues over $500 million, only 27 percent of the sample fulfilled 80 percent of the basic criteria for providing an integrated service or sales experience across multiple channels. Tellingly, 73 percent of executives at these firms answered that “getting alignment across internal organizations” was their greatest barrier.