#CXforum: Gut-feel doesn’t cut it – measuring true ROI of #CX Initiatives

Every enterprise wants to deliver a better customer experience to its users and consumers, but how do you measure the effort? Is there a way to meaningfully, and financially, measure the ROI of #CX-related expenditures?

In this session of the #CXforum, we sat down with Ed Jenks of Hewlett Packard Enterprise. Ed is the Head of CX Transformation Services within the Business Process Services Group at HPE. Ed’s approach to CX is in line with the HfS view that there are three main “transformational” initiatives that drive successful brands (specifically Digital, Trust/Risk, and Customer Experience), and his thoughts on how CX initiatives can drive an understanding of ROI that is based on evidence – and not just “gut feel” – are spot on.  

We continue to see the need for enterprises to focus on the intersection of digital, CX, and trust/risk initiatives, as they both individually and collectively play a significant role in holistic security and overall enterprise trust.

A few key themes from our conversation:

The need for “real” ROI: The concept of Customer Experience (CX) ROI is often a “gut feel” need – the C-Suite and the CMO know they need to deliver a great experience to their brand’s consumers. But as CX-based expenditures rise, the ability to demonstrate proof of value – an ROI that is based on evidence and can be demonstrated in an Income Statement – is increasingly important.

Establishing an outcome-based ROI baseline: Establishing a financial, or performance-based, baseline is not only possible, it’s critical to establishing a culture of #CX where an enterprise can adequately test, analyze, and reinforce specific initiatives that both impact #CX and financial performance. Failure to establish a financial metric can lead to “false values” where CX and related scores may rise but not result in any appreciable increase in financial value.  

Extending ROI throughout the enterprise: The value of a CX initiative should impact the entire enterprise, and should involve the entire organization, not just the CMO’s office. This often requires an organizational transformation where both client-facing and back-office operations need to be part of the overall CX team AND have some mechanism for benefitting from CX initiatives. ROI isn’t always a financial model for individual business lines, but often incorporates other value that must be measured and understood by all business units in the pursuit of greater overall financial value.  

Putting CSAT where it belongs: CSAT (and other forms of customer satisfaction, such as the Net Promoter Score) are valuable, but based on subjective criteria. Valuing CX initiatives through statistical data that can be measured and validated, such as an X% improvement in a particular sales metric, or a usage/adoption metric Combining these metrics, and demonstrating collective value, can be key for enterprises to continually adapt CX initiatives, determine quickly what drives true financial results, and develop an enterprise CX strategy.

Driving a culture of Invest > Data > Value: Customer Experience is not just a one-shot deal, it is an ongoing transformational process that requires an culture that embraces the concept of investing in CX pilots, measuring the valid results, and driving forward those initiatives that drive enterprise value (and quickly discarding those that may feel good, but lack demonstrable causality between investment and financial results). CX initiatives aren’t just about returning a positive result, they’re about returning the “right” result.