Today’s customers are more powerful, more informed, and have higher expectations than ever before. CEOs know that meeting their needs must become an ever-greater priority if organizations want to stay ahead of the competition. According to KPMG’s US CEO Outlook 2016, customer loyalty is a concern for 90 percent of CEOs, and just over half believe they are not keeping pace with customer expectations.
The reason customer loyalty is such a big issue for CEOs is its direct connection to driving top-line growth, says Julio Hernandez of KPMG’s Customer Advisory practice. “When 90% say they’re concerned about customer loyalty, they’re really implying they need to grow the business — they need to protect their core and sell more to existing customers, as well as extend their products and services to new customers,” he explains. “When I talk to clients across different sectors, including retail, consumer packaged goods, hospitality, banking and insurance, they are consistently expressing the same sentiment ‘I’m in a battle for growth.’ And “It’s a race for the customer.” This applies across the business-to-consumer, business-to-business-to-consumer and the business-to-business operating models.
CIOs can help bring focus to customer experience
The next few years will be profoundly transformative to the enterprise, found KPMG’s CEO Outlook. In fact, more than two-thirds of CEO respondents said that the next three years would be more critical to their industries than the last 50. According to the survey, “CIOs who help the organization bring focus to the customer experience while bringing automation, speed, and agility to the back office, will be well-positioned to respond to market dynamics.” Hernandez agrees with this assessment, saying that the CIO has a “massive role to play here.” The reality is, he explains, that today’s companies are trying to engage the customer in data-driven ways that weren’t possible just a few years ago — all of which require the use of technology, and therefore the CIOs expertise and input.
First of all, think of the most important enterprise systems of record for the customer, the CRM system. CIOs need to consider whether they have the right system, is it being used in the right way, is it accessible, and does it adds the right value. Next, there is the immense amount of “cookie crumbs” of data, across multiple touch points, that customers are leaving behind, says Hernandez. “They leave clues as to who they are, what they value, and how they act,” he explains. Today, companies can go even further, through social listening to hear what their customers are telling others. Companies can also listen and learn from those that aren’t currently their customers.
“The CIO must help harness data and analytics across the enterprise to enable and empower the organization with the right tools and insights This process will develop a deeper understanding of the customer by combining structured and unstructured data. This data will often be comprised of various types including panel, survey, behavioral, and attitudinal insights, says Hernandez.
Engaging the customer in the age of the customer
With consumers shifting rapidly to mobile and taking a mobile-first approach, carrying what can be thought of as a “second brain” in their hands, the CIO must be actively involved with ensuring that the enterprise is positioned to engage with the customer through mobile apps, as well as connecting mobile to any other touchpoint the customer engages with — whether it is a contact center, a sales floor representative, a front desk clerk, a dealer or digital platforms such as online banking. All engagements need to be enabled to work seamlessly with the consumer.
The CIO also plays a pivotal role in enabling how treatments are delivered to the customer and prospect at the point of customer interaction, says Hernandez. “The CIO is on the front lines of using next-best-action technologies and centralized decisioning tools to lead the consumer to the point of purchase in a cohesive, organized manner. They are enabling the personalization agenda and empowering the front office organization to engage with the consumer in a more relevant manner.”
The key to success in this area, he adds, is speed and agility. The CIO and the IT organization need to act rapidly to implement new apps and technologies, while embracing and integrating new touch points. “We’re seeing IT organizations accelerate in this area by developing app factories from within, accelerating from idea to execution with the use of scrums, hackathons, and testing minimally viable products to get rapid feedback from the customer.” He adds, “That is a challenge for CIOs who are accustomed to legacy delivery models.” The CIO needs to also act as ambassador in this essential area, working with the CMO, CFO and CSO — with all of their increasing demands and expectations — to enable these interactions to take place and be relevant. “It makes the role more interesting and more fun, but expectations are ratcheted up, as well as the clock speed,” he says.
Keeping pace with the needs of today’s customer
According to the 2016 CEO Outlook, CEOs recognize that they are operating in a new world. Nearly 70 percent are concerned about dealing with issues that they never had to confront before. In addition, they likely “come from a world of companies with defined boundaries—one where they knew who their customers and suppliers were—to a much more porous business environment.”
Now, the evolution of a more informed and powerful customer, combined with the integration of advanced and ever-evolving technologies and the pressure to innovate, has created a growing awareness of the need to keep pace with the needs of today’s customer. It has truly become a battle for growth and a race for the customer.
The CIO can and must help the CEO navigate this challenging journey and transform the organization so it thrives. “It’s really about the CIO looking up and around at the entire ecosystem, as well as down within the organization,” says Hernandez. “It’s critically important for the CIO to keep an eye on emerging technologies in order to evolve the business and deliver intelligently and quickly. This must be done while also providing the tools needed to enable the entire team — never forgetting to harness data streams and to pay attention to the competition.”
Overall, the CIO can be a huge enabler when it comes to focusing on the customer, he concludes: “The CEO needs help thinking and making informed decisions about all of these issues, or they could get caught flat-footed.”
For more information on how KPMG advisors can help you balance your customer needs with your business profitability, visit the KPMG Customer Advisory webpage.