The primary purpose of the Customer Experience (CX) IDCA improvement cycle is to help organizations improve interaction and touchpoint CX for using an organization’s products and/or services. SQM’s CX IDCA Improvement Cycle is used for identifying interactions and touchpoints that need to be improved, developing and presenting solutions for CX, checking to see if the action plan implemented has improved CX and acting to fully implement CX improvement solutions. The main purpose of the CX journey mapping process is to identify CX opportunities for improvement. The main purpose of the CX IDCA improvement cycle is to develop an action plan to improve CX. Therefore, CX journey mapping and the CX IDCA improvement cycle should be viewed and used as complementary tools.
Powerful Benefits of the CX Improvement Cycle:
VoC closed loop improvement cycle – uses a comprehensive four-step (i.e., Identify, Develop, Check, and Act) VoC closed loop improvement cycle as an ongoing business practice for identifying areas to improve and for implementing people, process, policy, technology, and service practices that will improve CX. In other words, this process uses VoC survey research and customer in-depth interviews to analyze CX on an ongoing basis in order to develop and implement new practices for improving CX. 70% of clients using this process improve their contact center CX.
Looking outside-in – the CX improvement cycle uses customer survey feedback as the foundation for identifying and developing solutions, which is an outside-in approach. Put differently, this process looks externally first through the customer survey feedback and then looks internally to identify and develop CX improvement solutions. As previously stated, looking externally first is a best practice for ensuring that new CX initiatives are focused on meeting customer expectations.
Outcome driven – targeted opportunities are identified by focusing improvement efforts on the top repeat contact reasons that have hindered customers from resolving their inquiry or problem in one contact. The top 5 repeat contact reasons represent 40% of all repeat contacts. Repeat contact reasons are identified based on the customer survey and/or interview feedback from CX organization interactions and/or using a contact channel. This approach provides the greatest insights for improving CX because of the focus on the top repeat contact reasons for areas such as orders, inquiries, or problems.
Source of error focus – is used for identifying all SoE areas (e.g., contact channel service, products, pricing, policies, process, service work) that have created repeat contacts for resolving the same inquiry or problem. Contact center managers tend to focus CX improvement efforts on CSR SoEs. However, organization SoE such as products, pricing, policies, and marketing practices represent 52% of all repeat contacts, so it is extremely important for contact center managers to identify and improve these sources of error. By being able to identify organization SoE, contact center managers can build the business case for getting the necessary support from non-contact center departments for fixing the issues identified that have hindered customers from resolving their inquiry or problem in one contact.
Financial improvement – improving OCR not only improves CX, but it also lowers operating costs. For every 1% improvement in OCR, operating costs improve by 1%. In addition, when an inquiry or problem was a non-OCR contact resolution (e.g., took 2 or more contacts to resolve), net retention index (NRI) drops to 59%. A 5% increase in customer retention can boost the bottom line by 25% to 100%.
The basic premise of the CX IDCA improvement cycle is to form a CX improvement team to review data (e.g., interaction and transaction surveys, CX in-depth interviews, call recordings, CRM system) so as to identify improvement areas and implement solutions for improving CX. In preparation for the CX IDCA improvement cycle, SQM conducts customer and employee surveys, as well as an operational survey. The foundation of the CX IDCA improvement cycle is based on SQM’s internal and external contact tagging system for identifying the reasons why customers had to make repeat contacts to resolve their issue. Contacts are tagged based on non-OCR customer survey feedback and interviews from customer and/or employee feedback sessions. The CX IDCA improvement cycle process team is typically comprised of SQM consultants and key personnel (e.g., CSRs, QA evaluators, managers from contact centers, other departments). The team spends five days going through the CX improvement cycle process.
The CX IDCA improvement cycle is a practical approach for improving work processes that are hindering CX performance. The below figure shows the CX IDCA improvement cycle roadmap that uses four major steps, and three specific steps within each major step. In total, the CX IDCA improvement cycle uses 12 specific improvement steps, which are a great roadmap for implementing CX improvements that have been proven to work.
CX IDCA Improvement Cycle Roadmap & Steps
Improve Csat – for every 1% improvement in FCR, there is a 1% improvement in Csat (top box response). Clearly, FCR is highly correlated to Csat. In fact, of all the contact center internal or external metrics, FCR is the metric with the highest correlation to Csat. The absence of FCR is the strongest driver of customer dissatisfaction. In fact, as previously mentioned, Csat (top box response) drops, on average, 15% every time a customer has to call back to get their initial call resolved. In other words, if a customer had to call in three times to get their call resolved their Csat (top box response) would be 30% lower than a customer who had their call resolved on the first call.
Improve Esat – for every 1% improvement in FCR there can be a 1% to 5% improvement in Esat. Contact centers with high FCR tend to have high Esat. Conversely, contact centers with low FCR tend to have low Esat. The level of stress is very high for the CSR who handles the second or third call from a customer whose issue was not resolved on the first call. Increasing FCR improves both Esat and Csat. The bottom line is that when customer calls are consistently resolved on the first call, Esat can increase substantially, especially for low FCR performing contact centers. Most contact center managers connect to the concept that high Esat can provide high Csat/FCR, but it also goes the other way in that high Csat/FCR can provide high Esat.
Reduce operating cost – for every 1% improvement in FCR, a contact center reduces its operating costs by 1%. If a contact center is performing at the FCR contact center industry average of 70%, it is important to understand that, potentially, 30% of customers will have to call back because their issue was not resolved on the first call. It is also important to note that for the contact center industry average, it takes 1.5 calls to resolve a customer’s inquiry or problem yet for customers who do not achieve FCR, it takes on average, 2.5 calls to resolve their call. This is an enormous opportunity to reduce a contact center’s operating costs as repeat calls represent 23% of the average contact center’s operating budget.
Increase opportunities to sell – when a customer’s call is resolved, it increases the customer cross-selling acceptance rate by up to 20%. SQM’s research shows that the customer’s needs must be resolved before the CSR has earned the right to move on to any type of sales activity. If the CSR cross-sells before the inquiry or problem is resolved, the customer typically becomes irritated and feels that the organization is pushing its needs, rather than serving the customer’s needs. As a result, the fundamental customer relationship is undermined.
Reduce customers at risk – only 2% of customers who have their call resolved on the first call expressed their intent not to continue to use the organization’s products and services as a result of their contact center experience. However, if the call is unresolved, 19% of customers expressed their intent not to continue to use the organization’s products and services as a result of their contact center experience. The cost of customer defections as a result of their contact center experience tends not to be understood by contact centers because it is not often measured. For many contact centers, retaining customers represents the biggest opportunity to add true value to their organization. Resolving calls is the key to reducing customers at risk. In fact, for every 2% improvement in FCR there is a 1% improvement in call resolution which results in helping the contact center retain customers.