Tuesday, January 31, 2017

The Five Phases of Decision-Making - Part 2

Image courtesy of palofoto
How well does your decision-making process work for you? Are you able to go from decision to solution to action with ease?

This is the second part of my two-part series on Peter Drucker's five phases of decision-making, which he outlines in his book, The Practice of Management. If you missed the first part, which covers the first three phases, be sure to visit that post to read about them. Today's post covers the last two phases, which are critical to the whole process.

Let's dive in with #4.

4. Find the best solution
The next step is to identify the best solution. Rarely is there just one solution, but the task is to narrow the alternatives down to the best one. He poses four criteria to pick the best solution among the options you've developed:
  • Risk. Weigh the risk for each solution against expected gains. As Drucker says: There is no riskless action nor even riskless non-action. But what matters most is neither the expected gain nor the anticipated risk but the ratio between them.
  • Economy of effort. Which action givs ethe greatest results with the least effort and effect the change with the least disruption to the business. Drucker notes: Far too many managers pick an elephant gun to chase sparrows. Too many others use slingshots against forty-ton tanks.
  • Timing. If the decision is an urgent one, pick a course of action that lets everyone in the company know that something important is happening. The opposite is also true. If the decision has no urgency and is slow to execute, the best solution probably sits on the less urgent end of the spectrum. Drucker's advice here is: Whenever managers must change their vision to accomplish something new, it is best to be ambitious, to present to them the big view, the completed program, the ultimate aim. Whenever they have to change their habits it may be best to take one step at a time, to start slowly and modestly, to do no more at first than is absolutely necessary.
  • Limitation of resources. The most important resource to consider is the people who will be executing the solution/decision. Also make sure that they have the vision, competence, skill, and understand to take the required action. Does the organization have the right people and the means to carry out the solution? Don't select the wrong solution because you don't have the right resources. His parting thoughts on this criterion: It is not solving a problem to find a solution that works on paper but fails in practice because the human resources to carry it out are not available or are not in the place where they are needed.
5. Convert the decision into effective action
This is my favorite phase. This is one that escapes so many. So much time is spent on listening, analyzing, decision-making, contemplating, gaining buy-in and adoption, etc. that we're too exhausted or overwhelmed (or simply over it, i.e., inaction sounds like the best action) to actually execute, to act, to implement the change. Drucker says it best: For a solution to become a decision, action is needed.

How do we convert a decision to action? Make sure everyone understands what change or change in behavior is required or expected of not only them but also others with whom they interact. Drucker  notes that motivating people to adopt these new behaviors requires them to feel like they own the decision or they were involved in making the decision. They don't have to be involved in the early stages of information gathering, but they should be involved in the development of alternative solutions. Drucker believes that if they're involved, the solutions may be richer because they have other perspectives and experiences that the decision-making manager does not have.

This is why we often talk about buy-in, adoption, grassroots efforts early on and why we say that it's best to not force change on employees but to involve them in the decision so that they feel a part of it. I wrote a while back: The bottom line is that when people are involved or know how and why they are involved, they're more likely to step up, commit, and help ensure you have the resources you need for success. If you force this on them, they'll probably push back.

Go and make it happen!

Whenever you see a successful business, someone once made a courageous decision. -Peter Drucker


Thursday, January 26, 2017

The Five Phases of Decision-Making - Part 1

Image courtesy of pls47
Have you adopted a decision-making process that works well for you?

If you have, I'd love to hear about it. If not, read on.

As a leader, your next best action is based on making a decision as to what that action will be. How do you arrive at that decision?

I've been reading Peter Drucker's The Practice of Management; in it, Drucker devotes a chapter to decision making. His thoughts on the topic are interesting, and he states that managers typically - and erroneously - focus on finding the right answer during the decision-making process rather than finding the right question. Beyond that, he notes that the most difficult - yet critical - part of the process is to put into action whatever was decided. That sounds like a no-brainer, but I've seen people spend hours or days or week trying to make a decision only for that outcome to go nowhere.

He outlines five steps that comprise the decision-making process:
  1. Define the problem
  2. Analyze the problem
  3. Develop alternate solutions
  4. Decide upon the best solution
  5. Convert the decision into effective action
I like that he actually makes action a formal step in the process.

Let's take a look at each of the steps.

1. Define the problem
Step one in this phase is to find the real problem and define it. Find the right question. Obviously, if you don't know the problem, you can't come up with a solution. But it often happens that people focus on the symptoms, not the true problem. This is a critical phase in the process. Spend time making sure that you clearly define the problem. Drucker advises to avoid symptomatic diagnosis and focus on finding the critical factor, i.e., the element in the situation that has to be changed before anything else can be changed, moved, acted upon. This reminds me of doing a root cause analysis to get to the heart of the matter.

The next step in this phase is to determine the condition for the solution of the problem. Think about the objectives of the solution. And consider what rules or policies will limit a solution. Why is this important? Sometimes these currently acceptable practices and policies will have to be change in order to put the solution into effect.

2. Analyze the problem
During this phase, you'll classify the problem and uncover facts about it. Classifying problems includes identifying who needs to make the decision, who needs to be consulted when making it, and who needs to be informed about it. (Sounds a bit like RACI to me.) Classification also includes the time commitment for the decision and how long to wait before its reversed, the impact on other departments or areas, how many other decisions feed into it, and the uniqueness of the decision. Classifying the problem ensures that the decision maker is stepping back, looking at the big picture, and understanding the impact on the larger organization.

Only once the problem has been defined and classified can you gather the facts about it. At that time, you need to consider what information you need to make a decision: what's relevant and valid to the decision at hand? and what other information do you need? Drucker notes that it isn't necessary to have all the facts, but it is necessary to know what information is lacking in order to judge how much of a risk the decision involves, as well as the degree of precision and rigidity that the proposed course of action can afford.

3. Develop alternative solutions
This one is a no-brainer. You should always develop alternative solutions for your problems. Drucker notes that alternative solutions are the only way to train our imagination; otherwise, he's afraid we won't land on a creative solution, rather come up with familiar and comfortable solutions.

Interestingly enough, he proposes that one alternative solution should always be to take no action at all. Rightly so, it is a valid alternative, and he spends a bit of time on this in the book. Unfortunately, one of the consequences of no action is the perpetuation of "this is the way we've always done things." So think this option through clearly and consider all implications; again, it is a valid and viable solution at times.

I'll wrap up Part 1 there and continue with the last two steps in my next post. You won't want to miss those last two steps; I'll outline details behind Step 4, where Drucker outlines criteria for making effective decisions, and Step 5, where I'll reiterate the importance of taking action. Some great advice wraps up Part 2 next week! Check back for it.

For there are few things as useless - if not as dangerous - as the right answer to the wrong question. -Peter Drucker


Tuesday, January 24, 2017

#CX Transformation Day is Coming

Image courtesy of GMC Software
We can all use a little help when it comes to customer experience transformation initiatives.

And that's the reason GMC Software is planning for an exciting virtual event on February 7, 2017, dubbed CX Transformation Day. I'm happy to partner once again with GMC to co-keynote this event with their VP of Product, Scott Draeger. The title of our virtual presentation is CX Transformation: What Does It All Mean? We'll be talking about the importance of a CX transformation, who benefits, and why.

The event begins at 9am ET and runs through 2pm ET. It will be seven hours packed full of content about various components of this critical business imperative: transforming the customer experience. There will also be networking opportunities and live Q&A sessions with the presenters to help you better position your organization for customer experience excellence. Speakers include:
  • Ryan Hart, Principal Analyst Serving CX Professionals at Forrester Research, will talk about anticipatory customer experience
  • Kaspar Roos, founder of Aspire Customer Communications Services and former Global Director at InfoTrends, will talk about the impact and importance of customer communications management
  • Mukul Ahuja, Senior Manager, Monitor Deloitte, will cover the next wave of digital disruptors in the financial services space
  • Ericson Chan, Ping An Group, China, will talk about innovations in the mobile banking arena
  • and more...
 If you haven't registered yet, please take a moment to do so. If you're not able to attend, you'll still want to register: GMC Software will email you a link to the recorded sessions after the event ends.

Innovation needs to be part of your culture. Customers are transforming faster than we are, and if we don’t catch up, we’re in trouble. -Ian Schafer


Thursday, January 19, 2017

Staying Ahead of the Competition

Image courtesy of vigdor
Do you know what it takes to stay ahead of the competition? Is that one of your business goals?

I recently did an interview with someone for an article she was writing, and one of the questions was about competition and how to best research the competition. Other questions on the topic revolved around how businesses can stay relevant and how they can set themselves apart in over-saturated industries. (I'll share the link here once the article is published.)

I’m a huge believer in innovate, don’t imitate. I think it’s important to understand what the competitive landscape looks like, but you cannot stay to focused on the competition. Do your homework. Be aware. Understand what they’re doing. But focus on your customers; research your customers and your customers’ needs, and then go and do your thing.

When there are clear, differentiated choices of products, services, and/or experiences in the marketplace, the decision is made easier for your customers. Bring your own unique value to the table. When customers' experiences with one company stink, they have the ability to go purchase from someone else. Let them decide.

So, to stand apart, innovate the experience. In a world with so many commodity products and services, the only real differentiator becomes the experience. Deliver a unique and differentiated experience. In most cases, that’s pretty simple. Honestly, just make it easy to do business with
your company.

The day after that interview, I saw this article from strategy+business about What It Takes to Stay Ahead of the Competition. Of course, I was curious to see how the authors addressed this topic. No surprise that we were in alignment; in their research, the authors found that four particular capabilities emerged as integral to sustaining high-quality performance:
Improvement. This capability was defined as a firm’s ability to make incremental product or service upgrades, or to reduce production costs.

Innovation. Defined as how strong a company was at developing new products and entering new markets.

Sensing of weak signals. Defined as how well a company can focus on potential banana peels in order to improve overall performance, including analyzing mistakes, actively searching out production anomalies, and being aware of potential problems in the surrounding business environment.

Responsiveness. Defined as a business’s ability to solve problems that crop up unexpectedly and to use specialized expertise to counter those complications.
I cannot argue with any of those four; as a matter of fact, I've written about these topics previously.

Improvements are critical. Without them, your customer experience will be stuck in the same rut it's always been in. Take your customer feedback, and do something with it. Here are a few examples of what I've written about Improvements.

5 So Whats: Prioritizing Improvement Opportunities
#CX Improvements and the Streetlight Effect
CEM Toolbox: Taking Action

Innovation is probably one of my favorite topics to write about when it comes to differentiation and staying ahead of the competition. A few examples on this topic include:

Innovate, Don't Imitate
Four Voices That Could Pull Your Company Out of the Innovation Rut
Moving at the Speed of Innovation
Customer Experience Fuels Innovation

Those slow-moving or slow-rising competitive threats are called Weak Signals. They are everywhere, and the trick is often knowing which ones to act on.

Weak Signals and Boiling Frogs

I've not written a post specific to Responsiveness, but it is a critical component in delivering a great customer experience and in standing apart from the competition. One way to counter the complications and implications of unexpected issues is to be proactive, to conduct pre-mortems (what could go wrong?), and more. A few proximate posts include:

What Role Does Intuition Play in Customer Experience
Is Proactive Customer Service Still a Moment of Truth?
CEM Toolbox: Setting the Stage for a VoC Strategy

Don't let the competition dictate your business decisions and your customer experience. Don't make the competition your primary focus or driving force. Do your own work. Understand your customers. Be prepared. And innovate. Continuously innovate... your products, your talent development, and your experience.

Competition is always a good thing. It forces us to do our best. A monopoly renders people complacent and satisfied with mediocrity. -Nancy Pearcey

Wednesday, January 11, 2017

The Future is Now: Take Your Customer Data to the Next Level

Image courtesy of paramitha
I originally wrote this post for CXpert. It appeared on their blog in August, 2016.

I'm often asked about the future of customer experience: What does it look like? What will companies focus on this year? What advancements have we seen or should we expect to see? What are the latest tools to help companies improve the experience?

For this post, it's the latter I'll address.

Data is available in abundance these days. There are a ton of statistics out there about the volume of data we see today vs. just a few years ago, but I think we can all agree that there's a lot of it! And I think we can all agree that most companies don't  use - or know how to use - even a tenth of it.

I've written previously about the six steps you should take to use data to transform the customer experience. Those steps - centralize, analyze, synthesize/contextualize, socialize, strategize, and operationalize - are handy, but most companies get hung up on the first step. And if they know where their data is and have pulled it all into a data lake, or if they've gotten as much data together as they believe they can for now, they then get stuck on the next step, analyze. This is where I think there is a real opportunity for customer experience professionals. This is where we've got some new tools.

Which tools?

Companies are sitting on a goldmine of data. It’s time to do something with all of that data. It's time to forecast the future and remedy the present. What am I talking about? Predictive analytics and, more importantly, prescriptive analytics. These are two important tools that customer experience professionals must have in their toolboxes in 2016 and beyond. Unfortunately, many of these professionals are still either unaware of the tools or aren't sure what they (can) do.

Traditionally, companies were able to identify and prioritize improvement opportunities from their customer surveys via correlation or regression analysis and quadrant charts, which identify priority improvements, fundamental essentials, and things to continue doing. But I don't think a lot of folks put faith into those quad charts, which don't offer up the ability to identify the impact those improvements (or the "continue doings") would have on the desired business outcomes.

In recent years, there's been an evolution from purely descriptive analytics (basic, summary statistics) to predictive analytics (predicting some future outcome based on what you know about the customer or on historical data). And now we have prescriptive analytics, which takes that prediction and tells you why and then what to do, outlining the next best action to take in order to achieve a desired outcome.

According to Wikipedia, prescriptive analytics: not only anticipates what will happen and when it will happen, but also why it will happen. Further, prescriptive analytics suggests decision options on how to take advantage of a future opportunity or mitigate a future risk and shows the implication of each decision option. Prescriptive analytics can continually take in new data to re-predict and re-prescribe, thus automatically improving prediction accuracy and prescribing better decision options. Prescriptive analytics ingests hybrid data, a combination of structured (numbers, categories) and unstructured data (videos, images, sounds, texts), and business rules to predict what lies ahead and to prescribe how to take advantage of this predicted future without compromising other priorities.

You can already see how this is a windfall for customer experience professionals and, more importantly, for customers.

Prescriptive analytics isn't just for survey data, though. If you've got customer demographic, transaction, interaction, or other behavioral data, you can analyze it to predict not only some outcome but also which customers (down to the individual customer) will most likely be aligned with that outcome, and then use prescriptive analytics to prescribe the next course of action to take with each customer to ensure the outcome is achieved. In plain English, here's an example: first you predict who is most likely to buy a certain type of car, and then you can identify which messaging, discounts, offers, sales approach, etc. to use to take the customer over the line.

Customers want personalized experiences; this is one tool, one method to use to ensure that happens. Use prescriptive analytics to take your customer data to the next level, improving the experience and adding value for your customers.

I've often said that data are just data until you do something with them. You need a tool to identify the what: what is it that you’re supposed to do with the data? Ultimately, you need those prescriptive analytics to identify why, how, and where - from which action - you’ll get the biggest bang for your buck.

Having prescriptive analytics in your customer experience toolbox gives you a huge, first-mover advantage. There's still a large awareness and education effort required to help companies realize the beauty and the benefits of using prescriptive analytics to transform the customer experience, especially the part about personalizing the experience down to the individual level.

If you’ve been stuck in a rut and haven’t been able to make any progress toward improving the customer experience, it’s time to rethink how you’ve been analyzing your data. Making data-driven decisions will only lead to better outcomes – for the customer and for the business.

If you torture the data long enough, it will confess. -Ronald Coase


Wednesday, January 4, 2017

The Authoritative Guide to #CX

Image courtesy of GMC Software
How do you know you're achieving customer experience excellence?

Back in November, I wrote a post about a whitepaper I penned for GMC Software on how the worlds of customer communications management (CCM) and customer experience collide, without question. Parts of that whitepaper and another I had written for GMC Software were incorporated into their first ebook, The Authoritative Guide to Achieving CX Excellence: Unlocking the Power of Customer Communications Management (CCM).

I recently joined Mirza Baig of GMC Software for a brief conversation about the book - it was more of a book review, and I was happy to share my thoughts on it. The book spans 10 chapters packed with thought-provoking content and links to other resources to help you understand the concepts and guide you in developing your action plans. It supports that much-needed focus on communications, which is often an overlooked part of the customer experience.

While the book outlines how various companies have...
  • Transformed the customer experience
  • Increased efficiency
  • Eliminated silos
  • Decreased risk, and
  • Gained visibility into the customer journey
... it's also a great resource that:
  • defines and clarifies CCM
  • outlines the benefits of CCM and how those are tied to business outcomes
  • supports the importance of consistency across the organization and the customer journey
Take a few minutes to listen to the book review podcast and then download your copy, as well. It'll get you thinking about things that you didn't even know you should be thinking about.

Good communication is just as stimulating as black coffee, and just as hard to sleep after. -Anne Morrow Lindbergh