IDC Study: Legacy Infrastructure & Disjointed Strategic Vision Are Barriers to Next Gen Customer Experiences

January 09, 2020
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Sponsored by Comcast

Written by Alan Webber, Program Vice President, Customer Experience, IDC

Brands are facing a crisis in how they engage with customers. For most of our history, humans have interacted with other humans. However, technology has now become our counterpart in many day-to-day interactions with brands. Whether it is the use of a mobile app to look up a product to purchasing it through a voice interface device to posting video reviews of the product online, almost every aspect of the interaction between brand and consumer is via a layer of technology. Yet despite the ubiquity of technology throughout the customer journey, they still want human-like interactions with brands.  

Companies need to begin providing human-like interactions through technology with personalization and by providing customized marketing, products, and experiences that focus on personal preferences and needs. But this is only a steppingstone. Brands that want to look and grow beyond personalization should focus next on providing empathy at scale.

BUILDING OUT EMPATHY AT SCALE ISN'T WITHOUT CHALLENGES

Providing empathy at scale will be a significant organizational shift for brands and any form of organizational change is difficult. Issues that constrain an organization from being empathetic with its customers range from a lack of budget, to a lack of vision, to lack of infrastructure. Recent research by IDC found that the biggest challenges to implementing a CX focused digital transformation initiative (see Figure 1) include business units having different priorities (30%), having a legacy IT infrastructure that doesn’t support digital business (27%), teams and departments having short-term vision that focuses on other priorities (25%), and a lack of senior leadership vision (20%).

FIGURE 1: Different Priorities and Legacy Infrastructure are Top Challenges to Empathy at Scale

Q. What are your organization's top 3 challenges in starting to work toward your Digital Transformation (DX) priorities?

IDC_Empathy2_Img1

Source: IDC, 2019


OVERCOMING THE BARRIERS

How to overcome these barriers? First by identifying the barriers, calculating the cost of those barriers to the organization, and then putting a plan in place to address them. Below we have called out three areas that are the largest barriers for organizations to digitally transform the customer experience they provide and provide empathy at scale.

Obstacle 1 – Internal organizational silos

Any organization with any history will have silos that hamper organizational change and 20% of our respondents said silos are the largest challenge to starting work on the corporate DX priorities including an empathetic experience. There is often a difference in priorities between LoB units who have direct contact with customers and IT units who are more responsible for an organization-wide infrastructure. More than 30% of respondents identified business units having different priorities as an issue, and it was the top issue identified.

Obstacle 2 — Legacy Infrastructure

The second issue that 27% of the respondents identified was being saddled with a legacy infrastructure that isn't capable of supporting a modern digital enterprise. Some organizations still operate in a mainframe or client/server architecture for their core business processes and functions. To shift business processes and functions that are critical to customer engagement to a new architecture is often a time-consuming and expensive, but necessary, effort. The need to make this update to the CX architecture in as fast and agile a way as possible is one of the primary reasons that organizations are moving to cloud platforms. IDC expects spending on public cloud services to grow from $229 billion in 2019 to over $500 billion in 2023.

Obstacle 3 – Unclear ownership of the customer

The third obstacle that brands face in creating an empathetic experience is determining who is in charge internally of providing that experience. Very few organizations have a role such as a Chief Experience Officer (CXO) or a Chief Customer Officer (CCO) that is specifically responsible for the experience a customer receives end-to-end with a company.

Most CX-focused digital transformation begins at the LOB level but doesn't stay there. After the concept is approved and initial efforts are started, the responsibility for implementation and the budget to support it often falls to the IT department. Our research found that 44% of respondents identified the CTO as being responsible for digital transformation efforts, followed by the CIO (38%), with other executive roles trailing. When it comes to the budget for DX efforts, the CIO (39%) is primarily in control, followed by the CTO (34%).

The result is often that no one executive leader is in charge and therefore responsibility for CX initiatives is diffused.

IDC research explores common barriers to improving customer experience at scale.

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