CX Blog

Why governance is vital for CX to not only survive, but thrive!

Why Governance is Vital for Customer Experience to thrive.

Nathalie Schooling : CEO nlighten

Strict regulations, the growth of technology, and an increasingly challenging marketplace mean customer experience and governance must go hand in hand. 

The concept of client experience is in a complicated place. On the one hand, it is a vital component of any business strategy. On the other hand, new regulations, growing customer demands, and an uncertain economic climate mean CX departments face pressures from all angles. CEOs are becoming increasingly cost-sensitive with many insisting that those departments that cannot show a clear return on investment be cut back. For this reason, Forrester’s predicts as many as one in four CX professionals will lose their jobs as CEOs tighten their belts.

All these challenges mean good customer experience must go hand in hand with good business governance.

Data, regulations, and CX governance

Data has become increasingly important for the client experience process over recent years. Digital technology means companies are capable of collecting huge amounts of information, from all sorts of sources, about their customers. This can be crucial for their business strategy – it deepens their engagement with customers, improves customer experience, and boosts revenue.

However, as data has proliferated, regulations have evolved. The arrival of data protection regulations such as GDPR places certain clear responsibilities on companies for how they handle data such as:

  • Getting informed consent from users.
  • Telling people where their data is being used and why.
  • Promptly deleting personal data when asked.
  • Ensuring the safety of data.

 

These provisions come together with vastly increased penalties which have the potential to cripple some businesses.

In addition, different countries are developing their own approach to data protection. Most take a lead from the EU’s GDPR but may differ in various ways. Those companies handling data in multiple jurisdictions will have to ensure their processes adhere to the rules in each country.

All of this creates an added complication for business governance.

Aside from the regulatory imperative, data protection rules have shifted customer expectations. They now understand much more about their data rights and will be much more likely to complain if they are violated. For example, if a company fails to stop emailing you after you have unsubscribed, it will sour your entire relationship with that company.

Data, therefore, is a regulatory and reputational issue. Before engaging with customers, you will need to have clear processes in place to ensure everyone in the organisation adheres to the rules when contacting customers. This includes making certain you have all relevant permissions in place for contacts, and that all contact information can be deleted promptly.

 

Cybersecurity 

The other big risk is the danger of cybersecurity. Cybercrime has surged over the last year. The rise of Covid-19, lockdowns and the shift online created a perfect environment for cybercriminals and contributed to a 400% rise in attacks during the pandemic.

If you handle data relating to your customer’s attacks, it can compromise both your own systems and that of your customers. If an attack compromises their details, the impact on your reputation and relationship with your customers could be terminal. Research from Opinium shows that 78% of customers say their perception of a brand changes with an attack.

Whether that change is positive or depends in part on how you engage with customers if an attack does happen, If you’re clear, transparent, and notify them quickly, an attack could actually improve your relationship.

If you adopt a defensive stance and try to hide the extent of the problem, it can shatter customer trust.

The same is true for those customers targeted with spoofing emails. Companies of all kinds are being targeted by cybercriminals mimicking their branding in an attempt to defraud their customers. Most people have become relatively digital savvy and will spot attempts as the frauds they are. A few may even play good corporate citizens and alert you of a breach.

If so, it helps to reply to them promptly thanking them for their information and to provide an update on your site alerting your customers to the existence of these emails.

 

Continuous improvement 

CX governance should be seen as an ongoing journey. You should be continuously improving your entire approach from business strategy through to deliverables and metrics. By doing so you can ensure you are constantly learning and delivering the best client experience possible.

Governance plays a key role in this. It helps you set down a clear roadmap, establishing who owns CX, and ensuring different departments are working to the same objectives. In many companies, individual departments may have differing views about client experience, who owns it, and what they are wanting to achieve.

For example, both the IT and marketing departments may believe CX strategy sits with them and have their own ideas about what this should look like or how they should go about it. This leads to a tug of war in which competing parts of your business pull in different directions.

 

Independence and accountability

To solve this you need a clear structure in place, perhaps with a chief customer office overseeing everything. He or she can develop the strategy and ensure all departments have the same idea about how it should look and what they want it to achieve.

Having independent ownership of client experience benefits your wider business strategy as it ensures one department does not dominate at the expense of another. It allows goals to be set which benefit the organisation as a whole, rather than the myopic vision of one department.

Having a clear line of governance, measurement and accountability gives the entire business a clear idea of the overriding goal, who is responsible for what, and how success will be measured.

This, in turn, will provide the information you need to set about a continual program of improvement ensuring your client experience business strategy is having the desired effect. In a world in which businesses are coming under pressure to find a return on investment for everything, this will help businesses get the most from their CX strategy.