Understanding Customer Experience, The importance of CEM over CRM

The points mentioned in this article can be described briefly under the following headings.

1. Defining what is customer experience

2. The importance of CEM over CRM

3. Means of tracking customer experience and acting on it

4. Rating the customers

Most companies forget to keep the customer experience on the forefront and prioritize on factors like marketing, advertising, increasing sales and promoting their products. Customers are baited by offering special concessions and other attractive packages but when it comes to taking care of the customer requirement and answering their queries, customers are ignored instantly. Customer experience is all about the indirect and the direct contact it makes with the Company.

Its high time Customer Relationship Management took the back seat and Customer Experience Management is treated with importance. Companies spend millions just on CRM software which is not justifiable. After all, if the Companies gave more importance to CEM then they could improve upon their service depending on a positive or a negative response.

There are three patterns of customer experience: Persistent, Periodic, Pulsed. By analyzing such data frequently, the Company can evaluate and improve their services periodically. This is a great means to stay up-to-date and in tandem with client’s satisfaction.

Rating the customers can give a clear right picture of whether sales will improve for the next quarter or will be poor. Customers can be divided into four kinds – Model Customers, Growth Customers, At-risk customers and Dangling customers. With such kind of information, the Company can study on how to improve their present sales records.

Concluding, Customer dissatisfaction is widespread. A measure has to be taken to improve this.

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The Balanced Scorecard, Competitive Strategy, and Performance

The objective of this summary is to explain the different types of indicators and various types of groups who give emphasizes on these perspective indicators in balanced scorecard for the purpose of formulating competitive strategy.

The Balanced scorecard (BSC) takes both financial and Non-financial performance indicators for the purpose of measuring the performance for an accurate decision making.  The major indicators/management control perspectives considered by the BSC are Customer perspective, internal business perspective, Innovation and learning perspective, and financial perspective.  Taking these things will allow the business to tailor its strategy, communicate those objectives to all, and seek for feedback.

In product-market strategy under competitive environment, four person are said to be involved, namely Prospectors, is a person who constantly tries to innovate new product and look for new market opportunities.  Defenders, who heavily try to create an efficient production for the purpose of creating a stable set of products and customer base.  Defenders can be further be classified into two, Low-cost defenders and Differentiated defenders. Analyzers, are the ones who tries to maximize the opportunity for the profit, they closely follow prospectors to respond quickly.  The fourth and final is Reactor, who does not respond to any product or market problems.

In a study conducted among many firms to find out the competitive strategy type adopted by them, and the emphasis placed by them on different dimension in the balanced scorecard.  Further all the archetypes are further divided in High performer and Low performers for better analysis which say, High and Low performing Prospectors are giving almost equal importance on the Innovation and growth perspective, however high performing prospectors give more emphasis on Financial and Customer Perspective than low performing prospectors. High performing Analyzers gives more emphasis on all perspective than low performing Analyzers.  A low cost defender has given lesser emphasis on Customer perspective and the innovation and growth perspective as these things will quest for efficiency. Finally, the High performing differentiated defenders are more of maintaining a greater relationship with customer, and should keep on working to server better for them. So it can be said that they give more emphasize on Customer and Innovation perspective as expected.

In can be concluded that, Irrespective of any type of group it can be said that the emphasize has given more on Customer Perspective compared to other perspective, which will further gives birth to the concept of Customer Relationship Management (CRM) principle, for a better management and further it can be said that there is no need to place equal weight for all the four perspective, but only to those which it needed based on the type of the group it falls under and only those which are considered as major contributors for business success.  But, the firm must also improve it bottom-line for satisfying its investors and maintain their confidence, so the emphasis has to be done even on Internal Business Perspective.

Which means it can be said that a fairly balanced approach of perspective has to be marked in the Balance scorecard and should achieve it not only for company’s growth but also for gaining a competitive advantage. 

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