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Service transformation: service design on steroids
by Melvin Brand Flu
Creating a customer experience that is seamless across multiple channels is a challenge that service design aims to take on. To do this for a large organisation is a significant transformation challenge that goes beyond just designing a service.
This article by Livework partner Melvin Brand Flu was originally published in Touchpoint Journal, Service Design Network (Volume 3, No 2, September 2011).
The power of service transformation
Bringing a fresh customer experience to the core of a business impacts virtually all policies, processes, people and systems of an enterprise and requires a radical approach to understand and prepare for the far reaching implications. Service transformation offers a powerful mixture of service design methods and traditional business consulting tools to guide the design and implementation of customer centric business transformation. This article reflects on work done within the telecommunications industry and argues that the service transformation approach enables organisations to deliver a new customer experience in, and across its customer touch points with a higher level of business success.
Design-led service projects frequently run into trouble when is time to implement service concepts, facing unforeseen business realities and organisational inertia. Business redesign projects might have the financial-, economic- and systems related analysis in place, but often fail to properly incorporate the human and behavioural aspects. Service transformation is service design on steroids, as it combines service design with business design and change management, to implement and imbed the new customer experience into the organisation. Service designers bring a strong customer experience focus and the co-creation with other disciplines produces outputs that can be understood and shared throughout the organisation. Management and business consultants contribute industry and business expertise, in addition to tools like root cause analysis and business modelling, that help ground experience design in the realities of an organisation.
The first phase in service transformation is experience led and is in the area where service designers traditionally operate. Designing and implementing the transformation is more the domain of business consultants, solution designers and change agents.
Design the Experience
The biggest challenge is to design a customer experience that fundamentally changes the existing one AND can be implemented in the organisation. It is therefore important to ground the desired experience in the principles and realities of the business involved. This is not intended to limit the creation of innovative concepts, but rather to be able to engage and excite management and employees with scenarios that make sense and look achievable. Designing a customer experience together with a corresponding employee experience increases the success and effectiveness of the service transformation.
Most service concepts are not completely new, as they exist in some form in different industries. What are standard customer practices in on business means radical thinking in another. It is important to bring the current disconnected and often painful customer experience into to boardroom to achieve executive sponsorship. By presenting topics and issues from a human perspective, executives, managers and staff can all relate to the desired customer experience, generating a high level of understanding and buy-in, especially when supported by associated facts and figures.
Identify and prove key scenarios
Even though benchmarks, market studies and customer feedback are important, the real proof of service concepts lies in testing scenarios in real-life situations. By setting up and running pilots in real settings, both customers and employees undergo the new experience, while at the same time exposing the internal bottlenecks to the organisation. The customer experience led approach provides valuable insights and (dis-) proves a number of assumptions about customer preferences and behaviour. The pilots start to outline the complexity, size and scope of the transformation challenge ahead. The insights, information and data gathered all need to correlate with recognized business KPI’s and benchmarks to serve as a foundation for a business case.
Prepare the transformation
While the new customer- and employee experience and insights can spark excitement and positive feedback from the shop floor to the boardroom, it does not bring the organisation any closer to executing a multi-year transformation programme. This requires significant management participation and a dedicated team to manage and align the complex web of stakeholders, interdependent activities, politics, systems, processes and priorities. It takes significant skill and effort to translate the different components of the experience into a set of projects and activities that can be executed. Ultimately the approach, scope and pace of the transformation are determined by the readiness and ability of the organisation as well as level of management commitment. The key steps of preparing the transformation are illustrated here in the context of a cross-channel initiative.
Create a Holistic View
A customer experience cannot be designed as such, because departments, processes, people all control parts that together make up the experience. A customer friendly process or tool will have little or no impact unless on-stage and back-stage staffs are provided the right context, training and incentives to create the desired experience for the customer. A broader organisational perspective and context helps management and staff to see how a particular experience improvement relates to the different areas of responsibility.
A service transformation map has 4 views that visualise, connect and control different elements of the overall customer experience. It is extremely effective to relate experience points to customer interactions, policies, systems and processes, which are discussed in cross functional teams.
By targeting key experience points in the customer lifecycle, organisations can significantly improve the overall customer experience.
In the customer experience view the key experiences of the majority of customers are mapped to the different stages in the customer lifecycle. Experience points reveal events that have major impact on the customer in addition to occurrences that offer great potential for improving the overall customer experience.Example: Receiving the first bill scores negative in terms of experience, but explaining the bill to a new customer before he receives it leads to a higher overall customer satisfaction together with a lower number of billing incidents.
The interaction view maps the interactions between the customers and touch points at each stage of the customer lifecycle. This highlights the components that need to align in creating a seamless experience across channels.Example: When a customer receives an offer in the online channel, this exact offer should be available to the customer as well as employees in all channels.
The organisational view captures the interactions along with interdependencies between the on-stage staff and the different back-stage actors, departments and organisational silos. Since this view is people centric, it shows the areas where the most change management effort will be required.Example: Alignment between central- and regional offices around services, prices and campaigns prevents confusion in the retail channel, which significantly improves customer- as well as employee experience.
The transformation view shows the relationship between the customer experience and the domains: people, policies, processes, procedures, practices and systems. By better understanding the relationship between these domains and the desired experience, issues can be tackled in the right domain.Example: A small change in the in-shop process enables employees to do online follow-ups with prospects using simple online tools. In this case a technology solution would have had little effect on the customer experience.
The views of the transformation map capture different components and activities that together create the customer experience at each stage of the customer lifecycle.
Establish value and potential
Establishing the potential of a customer experience is not a linear process of calculating increased sales and/or reduced service time, but should be determined over the entire customer lifecycle to establish the overall value for the organisation. This frequently requires a different measurement model to capture the change in customer preferences and behaviour.
Case in point: a customer might like the convenience of picking up an online product at a retail outlet, but the value for the organisation lies in the opportunity to educate and upsell that customer. Looking at in-store pickup this way changes this stage from a cost element, to one that generates revenue and saving. Assessing potential and value of this scenario lays the foundation for a business case which determines its place and priority on the implementation roadmap.
Confront reality: willingness, readiness and ability to transform
In building the transformation map, a number of issues come up that need to be resolved in one or more of the following domains: people, policies, processes, procedures, practices and systems. Organisations enforce practices that frustrate customers and employees, but changing the underlying policies has major implications for processes, systems, and employees. The cost in monetary terms and required political capital has decision makers and stakeholders wary about implementing this sort of change for real. Adjustments to processes or systems can improve parts of the customer experience, but the unwillingness to address core issues puts the improvement of some of the experience points out of reach for these organisations.
The level of management commitment, resources allocated and strategic importance given, together determine the readiness of an organisation to pick up the challenge of a large transformation programme. It is important to match the scope of the transformation with the readiness of organisation and not just its ambition. With the large number of moving parts that create an experience for the customer, it is important to force clear decisions on scope and direction at the highest level before even building the multiyear plan.
Transformation should not be mistaken for reorganisation as most organisations have undergone the latter, but few have attempted the first. Taking the time to prepare the transformation and matching it with the organisations abilities and readiness leads to an approach that has higher chance of success in delivering and imbedding a new customer experience.
Execute the transformation, consolidate and improve
Service transformation entails a fundamental rethink of how the organisation serves its customers and requires people and departments to think, talk and act differently. This brings new activities, skills, roles and responsibilities that can be very different from what is understood in the current organisation. While the expertise can be brought in to design and manage the transformation, the company itself needs to develop the ability to transform, as any transformation is a journey, not a project.
The implementation of a new service should focus on those stages of the customer lifecycle that in combination with core journeys will bring real benefits to the organisation and its customers. The transformation programme should engage the organisation early in designing and testing solutions and processes. This will result in tools and procedures that after a number of trials are ready to be rolled out. Effectiveness of the new experience should be measured against experience goals along with business KPI’s to monitor progress and impact, in addition to building the foundation for further service improvements. The underlying philosophy of ‘learn as we go’ allows adapting to changing circumstances, while maintaining a steady course.
These days, organisations do not have years to make fundamental shifts in the way they act, think, operate and serve clients. Business complexity, lack of focus, absence of vision and organisational inertia all conspire against attempts to improve the overall customer experience. Service design offers the tools plus insights to help envision and make tangible the way towards a better future. However, therein lays the dilemma: Service design on its own does not deliver the execution, nor the associated transformation required to make something like a cross-channel customer experience a reality. Organisations can be more successful in delivering service innovations into existing businesses by taking the service transformation approach of: designing experience, prepare transformation, execute transformation and consolidate service.
By mixing service designers with business consultants through the entire process, a service transformation programme can be based on solid business and customer principles, while recognising and dealing with the major internal challenges. Design artefacts such as the experience map and customer journeys offer a strong reference point for teams and departments throughout the organisation to rally around. However, it is the service transformation map that shows the rewards and consequences of the new customer experience. The process of putting together the service transformation roadmap, better prepares an organisation for the daunting task of truly transforming its customers’ experience.