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Industry Contributor 16 Mar 2023 - 5 min read

From idealistic crusade to economic imperative: the path forward for CX (or why it's time to stop talking about customer-centricity)

By Lachlan James - Chief Strategy Officer, Digitas

Why is CX still treated as a bolt-on? As a new shiny descriptor to someone’s title, a small team that sits adjacent to the main organisation, or empty words and promises in corporate propaganda. It’s as if businesses believe that by having a CX team and vision (and talking endlessly about both) they are set up for success. Well, they're not, says Digitas Chief Strategy Officer, Lachlan James, and that means big money is being left on the table.

Let’s face it, within corporate corridors ‘CX’ and/or ‘Customer-Centricity’ have become overused buzzwords. It’s emblazoned in every vision, mission and brand manifesto, shouted across the boardroom and bizarrely talked about as both a critical imperative and point of pride. If only the volume and frequency of mentions equalled flawless customer experiences and outcomes.

The disconnect is that whilst most companies believe they offer a superior experience, sadly most customers disagree. As Bain uncovered; “80 per cent of companies believe they offer a superior experience, however, only 8 per cent of customers held that same view”. Bain coined this discrepancy the ‘CX Gap’. CX chasm is more like it.

The reality is experiences truly matter. All the brand, marketing and creative brilliance won’t make up for a poor experience – because consumers today, yes all of us, are delicate little snowflakes. In fact, “86 per cent of consumers will leave a brand they trust, after only two bad experiences”. You read that right – they go from trust to goodbye in just two slip-ups. Ouch. So much for brand affinity.

So why the endless tokenism? Why is CX still treated as a bolt-on? As a new shiny descriptor to someone’s title, a small team that sits adjacent to the main organisation, or empty words and promises in corporate propaganda. It’s as if businesses believe that by having a CX team and vision (and talking endlessly about both) they are set up for success.

Why do so many companies struggle to go beyond this – adapting the way they operate, are structured, their culture and mindset, their investments in talent, and the processes and methodologies they deploy to be more customer-centric?

Sure, change at scale is hard, but that’s not why. The reason organisations fail at being customer-centric is that they frame CX as an ideological pursuit, rather than an economic imperative.

It doesn't have to be this hard. Take ‘agile’ as an example, which has been embraced by big corporates like cool-aid as a means of creating a more efficient workforce. Many organisations have repeatedly stripped, restructured, and reshaped their organisation top-to-bottom to be ‘more agile’ – often at huge cost to human capital, workplace culture and business continuity. And why? Because the case for agile is primarily based on the economics of what it will deliver to the business and shareholders. It’s an easy sell.

It is this straightforward, clear, and commercially focused argument for change that needs to be made for CX, rather than an idealistic one aiming to just ‘do better’ for our customers.

This logic and argument aren’t a panacea. Most organisations know the chinks in their armour and the skeletons in their closet. They know where prospects drop off, why customers churn and why they aren’t extending lifetime customer value and cross-sell. Yes, organisations are addressing these pain points, but it is mostly done in pockets, dependent on the willpower and budget of smaller teams with competing objectives – and delivered in endless inefficient cycles of iteration, rather than through wholesale top-down change with the weight of the organisation behind it.

The good news is that the argument for wholesale change is here. Forrester found that companies that invest in CX (beyond empty platitudes) via top-down organisational change, upskilling people, investing in specialists, and formalising processes and methodologies that enable CX thinking and outcomes to flourish – unsurprisingly end up with better products and experiences, stickier customers, and more value. They ultimately “grow revenue 3x faster than CX laggards. With CX leaders enjoying revenue CAGR of 15 per cent, while laggards trail at an average rate of 2.5 per cent”.

So there you have it, a tangible, substantial case for change that is grounded in economics – not an intangible and idolised, and mostly unrealised promise to customers. If you don’t improve your ‘CX Gap’ your customers will leave, many after just two bad experiences. However top-down and organisation-wide investment in CX yields 3x growth.

Organisational change is undeniably hard, but the risk of doing nothing carries an even greater and potentially existential longer-term risk. To mitigate this risk, companies need to stop seeing CX as an idealistic crusade, a bolt-on, or more words on corporate literature. They need to see the economic imperative and give CX the agile treatment: wholesale organisational change and enablement.

Real investment in CX involves the entire organisation. It’s about seeing CX as a cultural, operational, and existential reckoning. A core imperative that everyone in the organisation must share. It involves bringing in new skillsets, upweighting others, and changing the way teams work, the methodologies and frameworks they use and the metrics they chase.

The truth is, CX is spinning its wheels because the wrong argument for it is being made. Ultimately, this is about shifting from meaningless tokenism and theoretical promises of ‘customer-centricity’, to a growth-led economic imperative. Perhaps then, CX will stop being the ‘thing we’re trying to do’ and just be ‘the way we do’.

What do you think?

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