How to Choose CX Metrics that Drive Real Business Outcomes Fin Analytics

How to Choose CX Metrics that Drive Real Business Outcomes

In this post, we’ll examine some of the pitfalls of commonly used CX metrics today, and provide a framework for choosing metrics to drive real business outcomes.

As a CX leader, you want to create positive customer experiences for your company. But many CX leaders today are not equipped with good enough data or metrics to drive continuous improvement within their organizations. Traditional CX metrics fall short of quantifying the actual impact of CX initiatives, and as such, these initiatives are often overlooked.

In this post, we’ll examine some of the pitfalls of commonly used CX metrics today, and provide a framework for choosing metrics to drive real business outcomes.

Traditionally, the numbers that CX leaders are expected to drive have been things like “Are the customers happy?” and “Is the team running efficiently?” Measuring customer satisfaction and team efficiency are indeed critical, but often the metrics for these don’t directly tie to ROI for the business.

What really matters to the business is customer LTV, customer retention, growing spend, etc. CX can, in fact, have a massive impact on these company-level metrics, but the leap between “Did the customer have a good experience?” to real LTV has historically been difficult.

How to Choose the Right Success Metrics

In order to drive success as a CX leader within your organization, you need to equip yourself, your line managers and your agents with metrics and targets that are attainable and impactful. There are three main properties that all good metrics have:

(1) The number is important to the business and clearly connected to its success
(2) The number is representative of things that are within your control
(3) The number moves fast enough that you can demonstrate day to day, week to week, and month to month the progress of your team

I’d like to use CSAT as one example of a metric which most leaders are using today, to evaluate these principles. CSAT can give you a relative temperature check of how customers feel about the quality of your support today versus a few months ago, but it can fail on all three of these dimensions.

First, CSAT may not actually connect to business goals. Have you quantified how CSAT impacts customer churn, LTV, or increased revenue per retained customer? If not, how do you balance the equation and understand how many dollars to invest in trying to boost CSAT 10 points?

By choosing CSAT as your target metric, you also run the risk of frustrating the individual agents tasked with driving it. CSAT can make sense as an organizational goal, as a greater volume of responses should wash out any variance in customer disposition across agents, but it may not be suitable as part of the individual agent scorecard. It is a subjective customer perspective, which can often have more to do with whether the customer had a bad day, and not how well the agent did his or her job. CSAT is important to understanding how the customer feels about the company, but the individual agent is often many steps removed from that.

Lastly, there can be a real lag with CSAT, and you may need more direct measures of the efficacy of new policies, processes, and tools you are rolling out, that give you faster feedback with less noise. With big data, this is starting to get easier. You can begin to calculate how these things fit together in the longer term, but still CSAT doesn’t tell you in a given month, or even a given quarter, how the work you’re doing today is going to impact the company long term.

How can we align CX metrics with actual business outcomes?

The biggest opportunity for CX leaders will be moving to a world where every day you know if the changes you’re making have a positive and demonstrable impact.

CX leaders today are getting a ‘seat at the table’ to the extent that they can prove the link between the work they’re doing and real business metrics around profitability and retention. The next step is to connect the work of the CX team to a metric that changes quickly, and use it to goal your teams and see the impact of the work you’re doing.

What’s the next step for CX leaders?

Leaders need to set their teams up with metrics that are connected to the business, represent the work that is within the team’s control, and that reflect the impact of changes quickly, both at an aggregate level and on an individual level.

For example, an organization may use Cost per Resolution as its team-wide, company metric, and at the agent level, measure Percent of Tickets Resolved (of the tickets you touched, what percent of them did you close out?) Each agent then has the opportunity to drive this metric with every ticket, while also driving down the Cost per Resolution for the team as a whole. Agents are able to own their performance and see the direct impact for the business.

This is just one example of a metric used to drive business outcomes. On the whole, the more you are able to precisely define the metrics that are under your control, and which also ultimately add up to customer satisfaction and increased customer LTV, the more impact you will have both as a leader to your team, and for your business overall.


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