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Viewing Customer Relationships Through a New Lens

By Udi Ziv
Apr 20, 2010 5:00 AM PT

The relationship between a business and its customers is determined by the interchanges that occur between them. These interactions are complex. They occur over a wide range of communication channels, such as phone, email, Web and text, including some outside of organizational control like social media. They cover a broad range of topics and are somewhat spontaneous in nature. Companies devote large sums of their budget toward providing a satisfying experience for their customers when they contact them. Given this focus and monetary commitment, why do the results often fail to measure up to expectations?

Viewing Customer Relationships Through a New Lens

The problem is most businesses view their interactions with customers as distinct transactions. However, customers do not look at them this way; they view their relationship with a business as just that, a relationship, not individual interactions. What if businesses could go beyond what is just transacted with their customers when evaluating the quality of the service they provide and look at the overall relationship with a customer across all channels? What if by doing this they could incorporate a customer's feelings, wants and needs into the equation?

New Approach

Customer Dynamics, an emerging theory on customer-business relationships, does that. This theory looks at the relationships between organizations and customers from an interpersonal viewpoint. It goes beyond the transactional nature of the interaction to look at emotions, intent and desires. It views interactions as a chain of events rather than single point occurrences.

Intent is the engine that powers Customer Dynamics, on the business' side as well as the customers'. Customers contact an organization with a purpose -- to resolve a billing issue, overcome a problem or explore changing their service, for example. Organizations also bring intent into the equation. They are likely to want to manage their bottom line, outmaneuver the competition and secure long-term revenue growth.

From the customer side, intent is what initiates the interaction and serves as a gauge for success. From the organization side, it controls the flow and ultimately the outcome. These intents are not necessarily conflicting, but there may be conflict when a business fails to understand the nature of its customers' intent.

For example, Jan visits the Web site of her cellular phone provider to add a text messaging plan to her service. She successfully completes the transaction and receives an email message confirming the change. Unsure when the change actually goes into effect, she replies to the email asking for clarification. Not receiving a response, she then phones customer service to follow up and is told the changes take effect on the next business day.

Each of these interactions would probably be seen as complete and successful from the provider's viewpoint. However, when looked at together it is clear that miscommunication occurred between Jan and the business. Regardless of where the actual fault resides, Jan had to contact the company two additional times after her Web transaction. This serves as a cause of frustration for her, and results in additional service-related expenses for the business.

More Than a Transaction

So, how does an organization understand and methodically leverage Customer Dynamics to impact business performance?

Optimizing Customer Dynamics requires organizations to go beyond the transactional nature of its customer interactions. To look at the unstructured information within them -- for example, what was said (or typed) -- to identify clues about emotions, desires and other difficult to quantify aspects. There are three primary steps in this process.

First organizations must capture all customer interactions across every contact channel in order to have sufficient information to correctly gauge customer intent. Then those interactions need to be analyzed to extract useful insight. Due to the sheer volume of interactions this analysis needs to be automated. It also must take into account any correlation between customer contacts occurring within different channels in order to create a complete picture of that customer relationship. Finally, for change to occur, the business must take action based on these insights, in a way that creates impact in terms of improving both the customer experience and the business.

A forth step is also possible, utilizing technology to impact customer interactions in real time as they occur. This can be performed in a variety of ways. Prompting agents on next-best-actions based on what transpires during customer contacts and in the context of recent behaviors, or intelligent routing of a customer based on their intent as ascertained from recent contacts.

Top-Line Results

Businesses that embrace Customer Dynamics are positioned for rapid maturation of their organizations. The resultant value delivered to the business can be substantial due to the potential for impact across a wide range of operational areas, including basic to transformative initiatives.

At the base level, organizations need to ensure compliance with regulations and mitigate other risks to their business. Incorporating the full range of customer interactions into this process widens the scope of view, and automated analysis allows for the redistribution of resources to more valued-added endeavors.

Another basic operational imperative is efficiency. Understanding why customers look to a particular contact channel to conduct certain transactions assists the business in better directing contacts to high-efficiency channels, and then monitoring the customers' success to make sure the outcome is satisfactory. Improving efficiency also frees resources for other use.

Resources made available through compliance automation and increased operational efficiency can be put to use in creating competitive differentiation and improving top-line performance. Capturing and understanding intent -- of both the customer and organization -- enables the business to provide services and products that its customers value and make sure its operational processes align with those goals.

Perhaps the most intuitive benefit of Customer Dynamics comes from its ability to boost revenues, and correspondingly top-line financial results. Identifying common desires, understanding concerns and capturing best-practice approaches transforms the relationship to one of mutual benefit.


Udi Ziv is president of the enterprise product group at Nice Systems.


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