It appears that most people know about and have an understanding of Customer Experience (CX), but very few know about Customer Experience Management(CEM). The two are often thought of as the same concepts. Most companies are practicing CX, but very few have adopted CEM. There are differences between the two, and knowing which one does what is extremely important for the success of an organisation.
Before we be begin, just take a moment to write down a few things you know about customer experience.
Do things like mapping, touch points, and emotions make it to the list? In that case you are probably thinking about CX and not CEM. So what exactly is the difference?
CEM is a broader term, which focuses on a higher level business philosophy. CX is more of an operational level business strategy made up of various tools and techniques.
CEM is a broader term, which focuses on a higher level business philosophy. CX is more of an operational level business strategy made up of various tools and techniques. CEM is transformational, where a company changes completely to adopt to a whole new business orientation. CX is reactionary, where departments try to cope with external forces. It is usually a bolt on, that companies add on in hopes of improving performance. CEM is a long-term organisational level orientation that encompasses the whole organisation. CX leads to short-term results that focuses only on those people that have an interaction with customers. CEM is a top down approach, to which every single member of the organisation has to adhere to. CX is often generated from mid or lower level management and flows downwards, only reaching the CX department. CEM asks a company to do the right things, in contrast CX is about doing things right. In CX companies are just trying to improve what they’ve been doing. They’re moving from satisfaction to experience at a transactional level.
CEM asks a company to do the right things, incontrast CX is about doing things right.
Much attention has been paid to Customer Experience in the recent past. It appears to be the hot topic across the world. Companies have sections, teams and even full departments to look after customer experience. Most managers and directors that look after this have been thrown into this domain, often because they were in charge of customer satisfaction or customers relations. This has led to the development of Customer Experience (CX) as something quiet different from the original thought of Customer Experience Management (CEM).
CEM is a much bigger and broader term then CX. CEM is more of a business philosophy whereas CX is more mid level strategy. Having the right business philosophy or orientation is important to the success of business. To understand CEM as a business orientation, its important to look as some of the other key business orientations and how CEM evolved.
There are a number of key business philosophies. For example, Quality Orientation was popularised by Japanese firms such as Sony and Toyota after WWII. These companies believed that quality was the most important element to a business, everything they did had to be of a certain quality. The focus of the entire organisation was on continuous quality improvement – Kaizen.
A dated concept is that of being sales orientated. A company that is sales oriented is forced on selling its products. These companies don’t really care about what the customer wants, their focus is on trying to sell off what they produce. The focus is on short-term sales maximisation and short-term profits. In doing so, they may employ various integrated marketing communications’ (IMC) techniques and tools. Sales (and not sales orientation) is an IMC tool, which is different from a sales orientation. We can use sales as a tool, for all types of business orientations. For example a company that is marketing oriented may also employ sales as an IMC tool. Marketing oriented, in contrast to sales oriented, is focused on long-term profitability. A marketing oriented company will use sales as a tool, in addition to advertising, PR, etc. A sales oriented company will also adopt tools such as advertising, PR, sales, social media, etc. The main difference is in the philosophy. Once philosophy believes in short-term profitability, the other’s focus is on longterm growth.
CEM has now become a business orientation. The focus of the entire organisation is on improving customer experiences. However, most companies have adopted customer experience as a business strategy and not a philosophy. The focus of these companies is on improving existing processes. They will use tools and techniques such as experience mapping, finding out key touch-points, NPS, etc to improve the customer experience for customers. The term experience is being replaced with satisfaction. This however, does not mean they have adopted the CEM philosophy. Very similar to companies that adopt sales as a tool – not as a business orientation.
CEM has now become a business orientation. The focus of the entire organisation is on improving customer experiences.
CEM stems from a service orientation philosophy. The basic idea behind service orientation is that we are selling a service or a set of services – not physical products. Even if companies are selling products, the focus ought to be on the service aspects of business and not the physical product itself. By focusing on services, companies are able to distinguish themselves from their competitors. Customer Experience Management has built upon this philosophy and gone a step future. Companies are selling experiences not products.
Entertainment companies were, perhaps, the first to realise this. Good cinemas know that they are in the business of selling an experience -not in the business of movies. Disney is one great example of an organisation that provides great experiences. Anyone who has been to a Disney theme part will know this. Disney is selling experiences, unmatched by any rival. Sure there are other theme parks that have bigger, faster, longer rides, but none come close to Disney. That’s because Disney is not selling the ride, they are selling a magical experience.
I have consulted for and been on the board of ZU-UK, a British/Brazilian performing arts company, that has transformed the way we experience performing arts. Instead of having the audience sit in chairs and watch the artists perform, at a distance, on a stage, the audience is asked to participate in the performance itself. Members of the public become performers. The company is thus able to transform the experience of a visitor from an audience member to a participant. Thereby ensuring that the customer gets an unforgettable experience.
BMW was among the first product oriented companies to realise the CEM philosophy. They are no longer in the business of selling cars (or automobiles). They are in the business of selling joy through the cars they sell. So everything they do has to create joy for the customer. Many other great organisations have realised this and have thus transformed the way they do business. Zara realised that great experiences will come from not improving their stores, but to re-design their supply chain so that customers get the latest fashion in the shortest time. Ikea, re-did the home furniture shopping experience. Harley-Davidson’s consumer communities (HOGs) ensure that the experience of using the product extends well after the customer has purchased the product.
These organisations are CEM oriented. They have not bolted on a CX strategy, instead they have transformed the whole organisation to live and breathe the philosophy of great experiences.