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customer experience metrics modelCustomer experience metrics track your company’s propensity for growth. Some customer experience metrics prioritize growth opportunities. Others monitor the goodness of customer touch-points. Some metrics stimulate employee engagement while others reinforce the status quo.

Importance of Customer Experience Metrics

Metrics selection may be your most important decision for customer experience success. This is because customer experience metrics communicate what matters most. Since customers make salaries, budgets and dividends, possible, your customer experience metrics also communicate what matters most to employees, executives, and investors. Metrics drive executives’ and employees’ thinking and doing. Furthermore, they communicate what is rewarded. Hence, the gravity of upside and downside to customer experience metrics selection cannot be overstated.

If you had to choose two words to sum-up what customer experience managers do, you might say “measure progress”. Accordingly, voice-of-the-customer tools essentially measure customers’ temperature, to predict your company’s financial growth.

Laws of Metrics

“Taking the temperature of customers to predict revenue” is in itself is a clue to the “laws of metrics” (like “laws of physics”). They’re not stand-alone figures. Instead, they quantify a process flow. That probably brings to mind something like touch-point or journey mapping. However, those aren’t the process flows to zero-in on for customer experience management metrics.

Instead, think of customer experience as a chain of activities and decisions that originate with your company’s suppliers. From there, they continue from department to department throughout your company. The chain eventually results in products, policies, business models, processes, services. These produce touch-points and interactions that collectively influence what customers experience.

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It’s Like Physical Fitness

Customer Experience Improvement ModelIt’s faulty to focus your metrics attention on end-results, such as NPS, CSAT, uplift, repurchase, and so forth. Think of what it takes to meet other goals in business or life, and you’ll see what I mean. For example, if your friend wants to lose weight, you would probably laugh if he focused his attention on his bathroom scale. You likely snicker at his focus on shapewear, attractive patterns and lines in his clothing, and charming the people around him.

Your advice: “You’re really going to have to hit the gym on a regular basis. You should mix cardio and strength exercises to manage heart rate and metabolism. Be religious about portion control and a balance of carbs-fats-proteins, and get enough sleep.” Pure and simple, that’s the hard truth you give your friend, right? You might even suggest a tracking device or website or coach that can monitor activity, exercise, food, and sleep. Bingo: that’s the way it works in customer experience management, too.

#CustomerExperience metrics track your company's propensity for growth. It communicates what matters most and drives thinking and doing. #CX #cxm Click To Tweet

Customer Experience Metrics: Two Predictive Paths

There are two paths of metrics you should monitor. They’ll show what’s predictive of desired end-results: (1) action plan metrics and (2) program metrics.

Action Plan Metrics

Balanced Scorecard Leading IndicatorsLike the fitness example above, these metrics can be diagrammed as internal process check-points that give you an early heads-up about whether you’re on-track. An in-process metric indicates likelihood of scrap, re-work or disappointment down the line. Accordingly, you can make adjustments in your work to get it back on-track before those nasty things happen. When you identify something to measure that allows this, it’s a leading indicator. “Leading” because you see it before your stakeholder is aware of its output.

To identify good action plan metrics, start with voice-of-the-customer: (a) What are the most severe hassles customers deal with? (b) What are customers’ most-desired innovations? You may be tempted to zero-in on (b), because it appears to be the ticket to revenue growth. Yet, change management studies show that humans are slower to embrace the positives when there are still a lot of negatives in-play for them.

Read customers’ comments associated with the most severe hassles, and define a problem statement from the customer’s viewpoint. Then, identify the key themes among the comments. Next, conduct root cause analysis for the reasons why these hassles occur. Finally, identify a metric that gives you a heads-up about your root cause solution progress. This is a predictive leading indicator.

Program Metrics

Leading IndicatorsThe key role of a customer experience management professional is to facilitate ownership of the customer experience across all departments and employees. Everything they do contributes one way or another to what customers experience. As such, it’s essential to monitor their ownership progress and your facilitation progress. Examples include percent of employees who know what the top three customer hassles are or percent of relevant departments participating in root cause prevention of a chronic customer hassle. More examples are action plans on-track or employees in cross-functional teams to tackle a big customer issue, and so forth. These are leading indicators of the action metrics, because they reflect internal engagement necessary to “moving the needle” across the flow of activities that lead to what customers experience.

The key role of a #cxm professional is to facilitate ownership of the #CustomerExperience across all departments and employees. Everything they do contributes one way or another to #CX. Click To Tweet

Customer Experience Metrics Empowerment

Connecting Leading & Lagging Indicators

To empower your friend in his ongoing pursuit of physical fitness, you recommend that metrics from his tracking device be placed side-by-side the metrics from his bathroom scale and clothes sizes and compliments from friends and acquaintances. The tracking device represents leading indicators (predictive heads-up trends) and the scale/clothes/compliments represent lagging indicators (end-results).

When leading and lagging indicators are shown together on a dashboard, it’s empowering and enlightening. Do this with your program metrics, action plan metrics, and customer engagement/voice metrics. Add context with operational and financial metrics, and you’ll enable others to see the whole picture toward your company’s financial growth. Metrics for customer experience management may be the most influential facet of your strategy.

Customer Experience Indexes

Customer experience metrics are summarized by indexes. Not all customer experience indexes are created equal. Customer effort scores are typically about touchpoints such as service. Customer health scores are generally about product effectiveness. Net promoter score is about extending your marketing and sales reach.

Net Promoter Score assumptions may be inaccurate: are Promoters among your core-growth customers? Do Promoters typically recommend only your brand, or certain competitors as well?

Ease-of-doing-business interests CEOs as they shift gears from shareholder focus to stakeholder balance. It’s measured by the customer experience value quotient.

Customer lifetime value may be the most under-used index. However, it has tremendous power in communicating the importance of necessary customer experience changes. It conveys to managers how much of their business is at-risk or at-opportunity by shifting from the status quo. This is actually a customer experience leader’s number one job: stimulate growth-generating change.

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