In late 2023, the Customer Experience Professionals Association (CXPA) Finland conducted its 10th annual study into the state of customer experience management (CEM), investigating the attitudes, budgets and advances that are driving CX standards at present. The resulting Benchmark allows participants and practitioners from across experience management to measure and chart their progress, understand their level of CEM maturity and compare their work with that of other organizations.
A total of 119 CX professionals from 103 organizations in 30 different industries shared their experiences this year, and their insights confirmed CX teams have increased their development activities, but are still working with more limited resources than before.
In this interview, Sirte Pihlaja, head of team at CXPA Finland and CEO of Shirute, tells CX Network about the corporate world’s appetite for CX excellence and where practitioners need to focus this year.
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CX Network: The latest results of the Customer Experience Management (CEM) Benchmark showed that internationally the level of maturity has decreased slightly from previous reports. What do you believe is the reason for that?
Sirte Pihlaja: There are slight fluctuations every year and the level of maturity does not increase or decrease more than a couple of percentage points at a time, so this result in itself is not remarkable. However, the overall trend is tracking downwards and that could be linked to the Covid-19 pandemic. It is an established fact that budgets are smaller now and teams are not as big as in previous years. Of course, it directly affects maturity when you do not have the money or the people to do anything.
CX Network: Staying on the theme of CX budgets, the 2023 Benchmark found competing priorities, lack of clear CX strategy and budget were the main barriers to CEM development. What are your tips for CX practitioners when pitching their projects and securing that senior level support for their initiatives?
Sirte Pihlaja: CX practitioners really need to regain that management support they previously enjoyed, and we are hearing more and more about practitioners using benchmarks such as this one to do that. Benchmarks allow them to show senior leadership what their peers and competitors are doing and pitch for budget to keep up, or they can use it to highlight a low ranking and spur action on improvements.
However, I also think there are too many organizations using metrics that are not directly converted to financials. These organizations should look at finding ways to create business cases for the projects and initiatives they are asking management to invest in. When they do this, they need to be able to measure their success in financial terms – that is the most basic step. They should also use storytelling to communicate the successes they have with their endeavors. This ensures everybody understands the benefits of executing a certain CX project, and the practitioner does not have to wait for a financial quarter or year to pass before they share their results.
But before any of this, make friends with your chief financial officer (CFO). When you have the CFO on your side, it is so much easier to get their help and create the business case for investment in the first place.
CX Network: Positively, more than half of respondents said they have a dedicated budget for CX management, and many are now planning to increase their CX investments again. Where should these practitioners and organizations focus for the greatest impact?
Sirte Pihlaja: That depends on the maturity level of the organization and where it is right now: you cannot start with advanced technology if you are currently at the Survivor level, which is the lowest maturity level in the CEM Benchmark.
If your organization is at the very low end look at getting the basic tools in place and really getting the organizational culture and the transformation of your culture up to speed. The aim is that everybody starts to live and breathe CX, and that is important for any organization, even those that are further ahead. Whether or not you’re going to be successful in terms of CX is all dependent on the culture that you nurture in your organization. Listen to your customers and co-create with them to ensure your CX meets their needs!
Once this is established, it is possible to look at the newest technologies. At present, Artificial intelligence (AI) is the one bandwagon that all directors and boards are willing to hop on, but technology like this should be used for productivity gains that benefit both EX and CX, not as a means by itself. The time saved thanks to higher effectiveness should, in turn, be used to focus on delivering better CX to your customers.
To be successful with any technological endeavor, you need to have gathered data to inform everything you do.
CX Network: According to the results, 65 percent of respondents feel that activities related to CEM have had a positive impact on the company's results in the past year. But only 15 percent have an ambition to become CX pioneers. What's your take on those figures?
Sirte Pihlaja: If we start with the positive impact statistic – it has declined year on year. In 2020, there were still 78 percent who felt CEM activities have had a positive effect. This could be down to the decreased budgets that were reported during Covid. When an organization has a smaller budget, it is more difficult to make an impact, so that is likely to be a factor.
When it comes to only 15 percent having an ambition to be CX pioneers, it is possible that enthusiasm is not so overwhelming as it has been previously. Many organizations are working to achieve the most basic things in CX, but activity is, fortunately, picking up.
When the last CEM Benchmark was published, CXPA Finland was positive that CX activities would increase and we have seen that happen, so we remain positive this will continue to improve, and we see there are certain organizations that want to lead the way.
The 15 percent figure is across industries and certainly we see more organizations looking to be the best of the best in their own industry, if not spearheading the whole profession.
CX Network: Despite the appetite to invest, only 58 percent of respondent organizations have defined CX as one of their main strategic goals for the year, down from 67 percent last year. In light of what we have talked about so far, what do you think it will take to move CX management back up the list of corporate priorities this year?
Sirte Pihlaja: Usually, company boards and management operate on buzzwords, which are often related to a new technology, such as metaverse or blockchain. Right now, it is AI, but personally, I do not believe you should use any technology for technology’s sake. Technology should be about how you can find true opportunities for new business, or new ways to enlighten customers and provide better service.
Most of the use cases for AI are about creating new ways to be more productive, or to decrease the time it takes to sell more, instead of reinvesting the time they get back to doing great things for customers. That is the golden piece: where can you focus and how can you use the time that has been freed up, to do things that are better for customers.
The other thing is that machines do not yet have emotional intelligence (EQ). This means you need to be very careful not to let the machines do the talking, so to speak.
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CX Network: To conclude, what is your take on the current state of customer experience management and where do practitioners and organizations need to focus in 2024?
Sirte Pihlaja: Our research confirmed there are good developments underway and there is a buzz right now of organizations doing lots of projects and looking to invest more. The focus must be on getting the board back on board! They should all think in terms of delivering great CX again, and support the definition of a sound CX strategy, as it is now more critical than ever to know where the available resources should be invested to make the biggest impact. Previously, there was a will to look at CX at a strategic level and how it can drive a corporate strategy through the customer’s experience. We should all work to make that happen again.