Experience Management

What is IT’s role in the experience economy?

The way organizations compete and win business has changed. Where once they were locked in a battle over goods and services, today’s most successful organizations are competing on a whole new front — experiences.

Over the past decade, spending on experiences has grown 4X faster than spending on goods and services.

It’s a shift that’s already opened the door to disruption in everything from financial services to personal transportation, and has permanently shifted how customers and employees interact with brands.

But what is IT’s place in this new experience economy? And how can it become the engine room of a thriving, experience-first organization?

Getting to grips with X-Data

Over the last 20 years, businesses have been inundated with operational data to help them optimize customer, employee, product and brand experience — we have sales figures, cart abandonment rates, win rates, profit, employee attrition, and thousands of other data points to help us fine-tune the machine.

When it comes to the systems organizations use to collect, analyze and act on O-Data, IT is a central player tasked with building and maintaining the infrastructure that enables everyone in the organization to use it to drive change.

But for organizations to succeed in the Experience Economy, they need a new type of data that tells you why things are happening - they need experience data (X-Data).

X-Data is nothing new, and every organization has tons of the stuff.

Think social media comments, online reviews, customer surveys, employee engagement results, 360 feedback, face-to-face conversations, user testing, focus groups… there’s hardly a team in the organization that isn’t collecting X-Data. And if a company doesn’t have an approved enterprise-wide tool to collect X-Data, employees just find their own.

So the challenge has always been organizing it, and structuring it in a way that allows it to become as useful to the business as O-Data has been in the past.

Every organization has systems in place to capture and organize O-Data whether it’s CRM, ERP, website analytics software - in fact, more than $600 billion is spent on these systems every year.

X-Data on the other hand is collected across such a wide variety of platforms, with each team in the organization running their own programs, that it has become almost impossible to control.

The exponential growth in X-Data over the past decade and the multiple ways of collecting it and storing it within organizations has led to:

  • Siloed data — without an enterprise-wide system for collecting and managing X-Data, it’s become diluted, as teams across the organization are unable to access vital insights collected by ‘other’ teams. It means teams rarely see the complete picture, and make decisions based on just a small portion of the data available. The end result is bad for the organization, and bad for customers.

3 - the average number of feedback platforms in use in a typical large enterprise

  • Failure to drive action — data without action is meaningless, so it’s vital your X-Data collection is plugged in to your internal processes and systems in order to drive action from the people who can have the biggest impact. Take a low NPS score for your latest product as an example. It could trigger an immediate resolution from your customer support team to step in and resolve it immediately. Beyond that however, it your raise a ticket for your R&D team too, giving them vital feedback as they plan the product roadmap. Or it could update that customer’s record, so the next time your sales team is talking to them, they have all the background they need to be most effective.
  • Security and compliance risks — with multiple tools in operation, many without IT oversight, organizations face the very real (and expensive) risk of falling foul of data security and compliance legislation. In a recent study, we found 1 in 3 IT organizations didn’t know how many tools employees were currently using to collect customer data. In a post-GDPR world, the prospect of so much customer data on unsanctioned platforms, with little oversight or control, is a terrifying prospect.

Organizations that use multiple platforms are 5X more likely to say they expect GDPR fines

  • Increased costs — it goes without saying that using multiple tools for the same purpose across the organization is missing out on economies of scale. That means extra costs, not just financially, but also for resources for data joining, cleaning analysis, support, maintenance, audits, training, and more.
  • Lack of impact - as we’ve seen, X-Data is most effective when it’s integrated with your operational systems. By combining X- and O-Data you’re able to see the impact of your improvements on key metrics like revenue, sales, profit, engagement, attrition and much more. Without that ROI, investing in improvements based on X-Data alone is a risk few execs are willing to take.

IT - building the foundations for Experience Management

When it comes to the systems organizations use to collect, analyze and act on O-Data, IT is a central player tasked with building and maintaining the infrastructure that enables everyone in the organization to use it to drive change.

X-Data is no different.

There are 4 key roles IT plays in enabling and driving change:

1. Build a world-class X+O infrastructure

As you look to transform how the organization operates in the experience age, standardization is essential. You need a tech stack that fully integrates your X- and O-Data, breaks down silos between departments and provides best practice methodologies, controls and tools across the business.

2. Provide intelligent technologies.

As we’ve already seen, X-Data is everywhere. So you need to use technologies that help you find the signal amongst the noise. Is it a one-off comment on social media or a sign of a bigger trend? Will sales of your latest upgrade rise high enough to justify the increased cost of production? Which activities should your learning & development team focus on to improve productivity?

You need to find a technology solution that parses huge volumes of data, both structured and unstructured, makes sense of it and automatically surfaces the insights that matter most.

3. Empower everyone in the organization

There isn’t a team or individual in the organization that can’t contribute to delivering experience whether it’s your customer support team, your HR org or your product designers. But without access to insights, they’re hamstrung. IT teams have a key role to play in providing the right tools that give everyone access to the insights they need, whenever they need them, to inform their most important decisions.

4. Mitigate security and compliance risks

There’s nothing more personal than X-Data. So IT plays a vital role in managing compliance and security when it comes to collecting and using customer and employee data, which can often contain sensitive and confidential information.

eBook: 6 things IT departments can learn from CX leaders to become a key growth driver