Turn new customers into advocates by digitizing back office operations


Editor’s note: This blog post was originally published on cio.com.

From business unit managers all the way to C-suite executives, people have come to view the ability to design and deliver compelling digital customer experiences as strategic for stimulating growth. It also is a way to respond to or even initiate market disruptions.

As a result, CIOs are under pressure to pivot their investment focus away from traditional, run-the-business IT initiatives toward “customer experience” capability platforms.

Web, social, mobile and analytics technologies provide B2C and B2B organizations with the ability to offer more channels through which they can invite digital interaction with customers. Companies are expending considerable resources to design and guide their customers’ journeys across these channels to ensure there is consistency at every touchpoint along the way.

But while customers frequently find interaction with an organization’s “on-stage” touchpoints to be quite compelling (i.e. web self-service, live chat, mobile apps and front-office staff who interact with customers), it remains all too commonplace for customers to suddenly realize that, upon encountering an organization’s “back-stage” supporting operations, they are no longer going down a digitized road.

Navigating digital dirt roads

Indeed, far too many customer journeys break down because the touchpoints customers experience when they interact with the operations staff remain the digital equivalent of dirt roads and backwoods trails. The operations staff who must deliver on the promises made by their colleagues “on-stage” continue to be encumbered by many things, including:

  • Processing paper and electronic documents manually
  • Using lines of business (LOB) applications that don’t provide a single view of records and related documents
  • Utilizing workflow management tools that force employees into a context tunnel, preventing them from seeing any other work being done other than the tasks before them
  • Having ungoverned spreadsheet applications that are completely disconnected from related documents necessary to complete tasks and comply with regulations

Investing in technology to achieve what Forrester Research calls digital operational excellence is not necessarily glamorous, but it is vital for organizations that want to create and end-to-end journey of customer experience excellence.

Consider these two important statistics:

  • 60 percent of customer dissatisfaction can be traced to back office inefficiencies (TARP WorldWide)
  • 60 percent of the knowledge and 73 percent of the human resources required for a good customer experience reside in the back office (European Business Review)

It’s also ironic that the sort of advocacy organizations want their clients to share through social media often depends on how skillfully back office personnel are able to handle those “moment of truth” interactions that will either turn customers into angry detractors or staunch lifetime advocates.

The most human of processes

Insurance claims handling is a perfect example of this. Some call the insurance claim the most human of insurance processes because it provides relief to policyholders in a time of need. According to research by Bain and Company, a policy holder who is delighted with how a carrier or agent processes their claim will stay longer and buy more products with their primary carrier. They will also make more referrals to friends and colleagues through social media.

Conversely, a poor claims experience sits near the very top of a policy holder’s defection list.

Yet, despite extensive research that quantifies the value of wowing a policy holder with a superior claims experience, Bain and Company also points out that that nearly 50 percent of an average claim professional’s day is focused on activities like completing forms and rekeying data that do not impact the outcome of the claim or improve customer service.

Focus on back office operations to provide superior service

Back office operations encompass a wide variety of functions, including loan applications, payment and order processing, claims management, reviewing university student applications and fraud investigations. Many people associate these functions with repetitious clerical work, broken down into specialized tasks and performed sequentially according to explicitly stated policies and procedures that dictate how work should be done.

But many document-supported operational activities, like customer onboarding, don’t follow this industrial model of task specializations and workflow standardization.

The work to be done – and the information necessary to do it – flows horizontally across an organization’s customer channels, its hierarchies and its information systems. Policies and procedures are often not explicitly stated, and the know-how to perform the work is often tacit, institutional knowledge found in employees heads.

If those employees leave, they take that knowledge with them.

What’s more, the increasing number of channels through which customers can engage supporting operations makes it difficult to predict when and where this work will be triggered. Adding complexity, the path it will take may vary considerably, depending upon what snapshot of information is available at a given time.

In fact, many estimate that 70 percent to 80 percent of all human-performed work in the operations workplace is unstructured and immensely difficult to map out.

To deliver great customer experiences, enterprises need to create a business capability architecture for backstage operations with the interlinked processes, information, applications, interfaces and databases necessary to support the multiple channels through which the front office is engaging customers.

According to Forrester Research, achieving digital this operational excellence requires “capabilities designed to enhance customer experience through converting operational tasks, information flow, and documentation to digital formats, reducing low-value and non-value-added activities that involve people, documents, and data.”

Enterprise content management (ECM) software provides the foundation to deliver these capabilities.

In my next post, I’ll explain how.

Ken Burns

Ken Burns

Ken Burns manages the Analyst and Influencer Relations program globally for Hyland, creator of OnBase. He is responsible for keep leading industry analyst firms informed about Hyland’s company and product... read more about: Ken Burns