The author provides an outline for applying the principles of innovation to explore customer needs and solve customer experience issues.
Editor’s note: Len Ferman is the managing director of Ferman Innovation and an adjunct professor of marketing at the University of North Florida.
The term innovation conjures up a multitude of visions. Most often people associate innovation with emerging technologies such as Google Glass or 3-D printing. Or they think of venture-funded start-up firms working on a hot new product, such as Vercyte, which uses the science of molecular cytology to create new types of medical tests. But rarely do they associate innovation with improvements to basic, everyday customer service. It is generally thought of as having to do with product and technology development, not methods for improving the experience when a customer calls or visits a store.
In this article I will outline a process for applying the basic tenets of innovation that customer experience executives can use to solve customer experience issues.
Most large companies plan ahead and develop strategic initiatives to ensure revenue growth. A major part of this strategic thinking includes teams, either ad hoc or standing, that focus on innovation. Several journal articles have described the steps in the innovation process. Peter Koen, et al1, described the process in academic terms in the journal Research Technology Management in 2001. The article identified a five-step process starting with opportunity identification and ending with concept and technology development.
I prefer a simple framework that focuses exclusively on how to identify and select ideas for development. The process involves three basic steps: customer exploration, idea generation and idea evaluation.
Companies that follow this process can gain a competitive advantage by systematically identifying strategic initiatives or new product ideas that will increase revenue and ensure long term company survival. The process can be similarly applied to customer experience issues.
There is a reason for the axiom “The customer always comes first.” Companies that do not focus on their customers’ needs will soon find that their customers will go elsewhere to have their needs best met. Accordingly, market research must be performed at the outset of the innovation process whether the task is developing a new product or improving the customer experience. There are myriad ways to identify customer needs. While research budgets and company resources often dictate the methods, at a minimum companies should conduct in-depth interviews with customers to assess both their stated needs as well as learn about their problems, pain points and challenges. The latter can serve to identify latent needs that customers do not overtly recognize or cannot adequately articulate.
To apply the process specifically for customer experience issues, the interviews must identify the top issues customers have at each possible touchpoint with the company, whether it is in the store, on the phone, online or via a mobile phone.
Only when customer exploration has been performed and a robust set of needs has been identified is the time right for idea generation. The old saying “Garbage in, garbage out” applies well to idea generation. If a company has not adequately or accurately identified customer needs then it should not expect idea generation to reveal a useful set of customer solutions. Even worse, inadequate customer exploration can lead to idea generation that sends a company onto an errant path.
Idea generation can take on numerous forms. The most traditional is a brainstorming session. Many parameters are necessary to conduct effective brainstorming sessions. None are more critical than effective facilitation in order to ensure optimal group dynamics. Another newer method of idea generation is the use of intranet platforms that enable all employees to share and comment on ideas virtually. Whichever method is utilized to generate ideas, the process should flow from customer need to customer solution. In fact idea generation becomes fairly simple and straight forward when customer exploration has been done well.
The third step is idea evaluation. Once idea generation is complete it is not uncommon to have hundreds of ideas representing a myriad of potential customer solutions. Most organizations do not have the resources to invest in large numbers of initiatives. In fact, many companies have budgets that will only allow them to pursue a critical few initiatives. Thus, idea evaluation is an essential step in the innovation process. There are many methods and steps that can be deployed to evaluate and select the optimal ideas. Once again the customer must come first. Customer feedback on ideas is critical to ensuring that a potential solution does in fact meet a customer need and may yield improvements to customer-delight scores. In addition, ideas need to be evaluated in terms of a company’s core competencies and specifically the company’s ability to cost-effectively deliver on the idea. When an idea scores high on both customer feedback and ability to deliver cost-effectively, then it has a high likelihood of success.
Customer satisfaction issues usually take a backseat when people think about innovation in a company. As a result, many companies do not put any resources toward the identification and evaluation of ideas to improve customer delight. Applying the principles of innovation to solve for customer experience issues, ideally executed by a dedicated team, is the best way for companies to identify initiatives to improve customer delight.
1 - Koen et al. (2001), “Providing clarity and a common language to the ‘fuzzy front end’.” Research Technology Management, 44 (2), pp.46-55