UNO February 2018

Client-centricity, the core of digitalization

The “new” customer is full of possibilities, is organized and empowered, and offers a great opportunity… so long as you know how to capitalize on this opportunity.

In recent years, we have experienced a significant shift of power held previously by companies—a power that is now in the customer’s hands. We have witnessed how passive customers have become empowered due to permanent connectivity, an abundance of options and the possibility of getting what they want, when they want it and where they want it. Furthermore, customers are now organized and connected with each other and seek immediacy, simplicity and socialization, but at the same time personalization and privacy. They have found their voice, and social networks and digitalization further amplifies it.

This new type of customer makes decisions in an informed manner and with infinite points of reference, and also interacts personally and digitally; simply put, the barriers between online and offline have disappeared for them. They are loyal, but in return, expect quality and transparency. This shift of power can be an opportunity, if we know how to capitalize on it. Companies must take the empowered customer’s side and then transform to operate and think in a client-centric way—from their perspective, understanding and addressing their needs—with the support of digitalization and by making decisions based on data. In this new era of information and empowered customers, understanding their current and potential needs and providing an impeccable experiences are not just good drivers to have, but essential to generate loyalty, repeat purchases and, subsequently, recommendations.

Putting the customer at the center of everything you do and meeting their expectations requires end-to-end digitalization, deep data-based knowledge and an ecosystem that supports transformation

In this regard, customer empowerment is not the only reason why client-centricity is essential. If you consider a loyal customer to be worth much more than their first purchase; that it is much more expensive to win a new customer than to retain a current one and that there is a higher probability of securing a sale to a happy current customer than a new one, then you can see how a client-centric mindset is also more profitable in the long term.

Putting the customer in the center of everything you do and meeting their expectations involves end-to-end digitalization, deep data-based knowledge and an ecosystem that supports transformation.

How then can one ensure that the customer is at the center of a company’s actions? A differentiated customer experience begins with a collective agreement and purpose to serve customers’ needs; in other words, a shared vision and an objective consistent with the brand and the company’s value proposition. Understanding customers’ fundamental needs and wants is the first step in determining what a differentiated customer experience will look like.

Putting the customer at the center as they interact with the company means doing so with an end-to-end point of view, which in turn requires focusing on the journey rather than just points of contact. Even if each point of contact does well, a lack of seamless integration may negatively affect the overall experience. Why? Because customer satisfaction is defined by the cumulative experience and the total multichannel points of contact over the course of a given time period.

An end-to-end digital transformation and the use of advanced analytical models are absolutely necessary to have client-centricity in the telecommunications sector

Other crucial actions include:

  • Understanding and prioritizing which journeys are most important for each customer segment and then reinventing them;
  • Digitizing the processes behind the most important customer journeys, doing so with agile techniques where multidisciplinary teams design, test and repeat on the field, continually refining the techniques through customer feedback;
  • Asking and making the customer a part of the product and service development process, as well obtaining their opinions on how to best assist and communicate with them. Digitalization, as well as a culture based on data and the power customer knowledge data provides, are essential drivers of the client-centricity equation.

To think about journeys and experiences, one has to stop thinking and working in silos or through channels. Instead, take any opportunity to improve the overall customer experience to grow customer loyalty. Furthermore, use the customer’s journeys as a frame of reference to empower employees and turn them into great brand and company ambassadors.

Achieving this mentality requires a deep and constant transformation based on aspects of organizational change, which includes five key factors:

  1. A transformation story that persuasively communicates the need and the advantages of client-centricity. This starts by incorporating the customer’s vision within the company’s positioning.
  2. Role models in the company who personify this vision… leaders who act while thinking of the customer, who know their needs by using a digital approach.
  3. Development of skills and abilities throughout the organization that allows customers’ journeys to change according to their expectations, while ensuring the fulfillment of your value promise.
  4. An effective and complete indicator system that measures overall experience, focusing on key customer journeys. Furthermore, it is necessary to link user experience metrics to operational and financial values, as well as goals that encourage cross-functional collaboration at all levels of the organization. This must be supported by technology and/or platforms that will measure, communicate and integrate these metrics into day-to-day routines.
  5. Including customer experience measures (satisfaction, repeat purchases and recommendations) as part of the company’s objectives, which also serves to instill appropriate attitudes and behaviors.

As telecommunications technology quickly evolves, customer demands and expectations increase by leaps and bounds. Furthermore, mobile connectivity has been a key element in empowering customers, as phones nowadays function as a digital companion.

In this context, client-centric  digitalization offers us telecommunications companies the opportunity to reposition ourselves, reimagine our business models and create innovative offers for our customers. This client-centric transformation fosters customer loyalty, therefore increasing retention and recommendations, which helps attract new customers with more digital profiles.

Big Data and a data-driven mentality are essential elements of this transformation. Advanced analytics’ models powered by customer information—keeping in mind, of course, basic privacy principles—allow companies to identify customers who are more susceptible to differentiated offers and enables companies to develop personalized and timely offers. They can even determine the best way to contact customers. Through these models, we can also establish areas of opportunity in service and coverage that can be addressed essentially in real time.

Also, the telecommunications sector presents unique options due to its digital characteristics. Operators who provide a superior experience in each interaction, from an end-to-end, omnichannel and holistic perspective, will stand out, face challenges and capitalize on the opportunities presented by the new generation of customers.

Eugenia Ramirez
Vice President, Strategy and Digital Transformation, Telefonica
Ramirez studied mathematics at the Faculty of Sciences, UNAM and has a master’s degree in Business Administration (MBA) from the Instituto de Empresa in Madrid. As associate principal at McKinsey & Company, Ramirez collaborated on topics of customer centricity, transformation and organizational performance, and contributed to the publication of A Tale of Two Mexicos, a research paper on Mexico’s productivity. She has worked in the areas of strategy, mergers and acquisitions at Walmart and served as principal in Alta Growth, a private equity fund. Currently, Ramirez is vice president of strategy and digital transformation at Telefonica in Mexico, where she is responsible for quality assurance and customers’ digital experiences. Mexico.

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