16 May These Red Flags Will Kill Your CX
-or How To Spot Diagnose A CX Program in Peril
This story is a sort of parable about one of the companies we’ve consulted with, intended to provide some insights about understanding whether your organization’s culture is ready to embrace CX, and if it’s not, identifying red flags which might prevent successful CX execution and overcoming them.
The company in question was an insurance firm that had previously tried twice to overhaul their customer experience systems and failed miserably. We were brought in to make the third and final attempt. With our help, they made a complete transformation in their cultural attitude toward and execution of CX. In the beginning, however, they displayed a number of troubling red flags which indicated to us that their previous attempts had failed for a good reason.
The CEO had made his internal change management team accountable for the transformation. The team was led by a task-oriented bureaucrat from the project management office. Let’s call her Audra. She was dismissive, obstinate, highly skeptical and treated us like intern candidates. She was also our direct contact. This was red flag #1.
The first thing we did when we landed for our initial kick-off meeting was call Audra from the Uber and ask her to tell us as much as she knew about the two past attempts. Knowing she wasn’t directly involved in either and clearly didn’t want to talk to us, we were prepared for a story with a lot of holes in it, but her attitude was terrible. In fact, this is how she answered the phone: “Steven, I only have three minutes, what do you need from me now that we cannot cover later in our kick-off meeting?” Yikes.
Surprisingly, her “three minutes” actually lasted 25 and she knew a lot more than we had assumed. These are the most interesting things she shared with us:
- She mentioned that the CEO wasn’t on board with the past two efforts. He pretended he was, but he wasn’t. The source of the effort was a Forrester CX PowerPoint printout that had been shared with the CEO by the COO several years previously. She called it a “board of directors’ mirage.” (I love that line.)
- She claimed that the COO, who sponsored the last two efforts, was totally hands-off as well, partly because he was clearly on his way out of the company. All of his direct reports with a hand in the effort took their cue from the COO’s lack of participation and direct sponsorship. Apathy was the signal from on high. She actually said, “no one likes the COO—he’s a hot mess.”
- Both Forrester and Deloitte had provided a CX strategy and remained tangentially involved but no one she talked to really knew why or to what extent. In her words, “…we have over a dozen consultants running around here without any boundaries and it has gotten out of control.”
- CX-related efforts were not addressed in senior leadership meetings.
- Anyone with enough authority to make a difference in the effort was assigned an opaque share of accountability for it, a system intentionally designed to help leaders skirt responsibility.
- The CEO emphasized that the CX initiative was not to disrupt the “day jobs” of any staff. He also referred to it as “the customer service project” and wanted it “completed” by the end of that year.
- Three directors had lost their jobs as a result of the previous attempts. She disliked all three of them and was happy to see them gone.
I hadn’t even started and I was already wondering what the hell I had gotten myself into. Just as I felt a headache coming on, something told me to be wary. There was something about her account of the situation that didn’t feel right.
The first of the two kick-off meetings that afternoon was an unmitigated disaster. Scheduled for two half-day sessions, the meeting included all the usual figureheads, our contact (the head of Change Management), two business analysts (each assigned 10% of their capacity over the next nine months), a very young and inexperienced project manager, one of the product design managers, a corporate communications manager and a delegate consultant from Deloitte. There was not one single person from the management team, despite the fact that I’d been told there would be. This was red flag #2.
Thirty minutes into the meeting, after all the participants had introduced themselves, Audra hastily introduced me as “the CX consultant guy from South Carolina who was hired by the COO.” (Such was her attention to detail, she didn’t even know what state we were from!) In that one sentence, not only did she throw out my agenda for the meeting and prevent me from introducing myself, she also tied me to the COO, whom she knew all internal people disliked and distrusted. The course of the meeting quickly devolved from bad to a complete disaster. The first half of the kick-off was run without direction or agenda, and amounted to nothing more than a lengthy bitch session. The second half was about what technologies she had selected to drive the effort. She talked through a dozen bullet points about what went wrong in previous attempts, and accompanying each bullet point was a platform solution she wanted to implement to solve each problem. In the last 20 minutes of the first meeting, one the business analysts looked over at me and said, “Hey, South Carolina, what do you think?” That was my breaking point. I knew I had to do something bold to take back control of the meeting.
I stood up and walked to the 30-foot whiteboard in the front of the room. Before saying anything, I wrote down the following three sentences:
“CX = Product/Service Delivery Quality + Price Quality + Customer Journey Quality. This is the equation we must all collaboratively balance.”
“In order to achieve something you’ve never been able to achieve before, you have to do things in ways you’ve never done before.”
“CX is not a problem to be solved by technology. It is an organization/team/people challenge requiring rigorous outside-in thinking that relentlessly centers around the experiential world of the customer. It’s difficult work but rewarding in how it can fully engage employees while making the company the best version of itself.”
It took me 90 seconds to write these sentences on the board. It felt like several hours.
Then, I turned around and said, “The effort in front of everyone here will succeed or fail relative to how well we can all embrace and work from these three sentences. And nothing against South Carolina, but we’re actually from North Carolina. We’re from CX Pilots and we have helped 35 companies just like this one turn around failed Customer Experience efforts—and we’re delighted to be here with you all and excited to jump in the trenches and help every one of you get this off the ground.”
Initially, I felt that my stunt had succeeded in rebooting the room for the second part of the kick-off, to be held the following day. However, after everyone else had left the room, Audra came over and, jabbing her index finger towards my chest, whisper-yelled at me for “throwing her under the bus in front of her colleagues.” She was mad as hell. I was scared of her. This was red flag #3.
We returned to the hotel and spent most of the evening reading the company’s annual report and looking at analyst research on the insurance industry vertical the new client was in. The next morning, we arrived at the company’s headquarters and checked in with the front desk. Shockingly, we were greeted by the COO, who had hired us initially. Oh, shit. I was fully expecting to be fired, given our contact’s parting words the previous afternoon. Apparently, discussions about that incident reached him just a few hours after the previous day’s kick-off.
He said, “Steven, I have to let you know, I’m not exactly sure how you did it, but you really upset Audra yesterday. On the other hand, you guys impressed everyone else in the room that you know your stuff and for that reason, I’m putting you guys in charge of this and have asked Audra to support you in whatever you need to make this successful. Thomas from Deloitte and I had a long discussion and he recommended you lead this instead of Audra. This will be complicated as Audra and her team need to stay involved but I have told her directly that she support you in all parts and pieces of this engagement.” This was red flag #4.
Two months into the engagement, we were running into one predictable obstacle after another. The initiative was being sidetracked, sabotaged and silo’d at every turn. Key meetings were skipped, emails and other communications essential to the effort were deprioritized. Our numerous attempts to meet with the COO to send up the appropriate warning flags had been postponed several times until we issued a pretty stark ultimatum, as kindly yet sternly worded as we knew how.
The COO eventually, reluctantly, met with our small team in the company’s busy and loud cafeteria. The meeting was scheduled for 30 minutes but ended up lasting 90. The COO had difficulty veiling his contempt for the CX initiative. He was clearly laying the groundwork to scapegoat our team for the initiative’s failure. After some conversation, we laid out precisely what was happening and the detrimental effect it was having on the initiative. The COO said his hands were tied because the CEO’s directive was: “I don’t want this project to leach one minute from anyone’s day job. Our side project cannot encroach on the drive to revenue. We need a strategy that will get us where we need to go on this damn CX project without it sucking up all the time of our people needed to keep the doors open and the lights on.” This was red flag #5, and what would become the final straw.
We resigned the engagement right then and there, in the cafeteria. We surrendered a majority of our contracted fee and chalked it up to experience. The day after we submitted our cancellation, the CEO’s assistant called me and asked if I had time that afternoon to speak with him regarding our decision. I made time to talk. This was what we call a green flag.
The CEO was kind, fair, and inquisitive. He wanted to know why we had decided to cancel the contract and asked if there was anything he could do to get us back and better supported to succeed. We shared the warning signs that we had noticed, especially noting the two months of complete inactivity, and suggested that his firm didn’t yet have the wherewithal to go through what it takes to succeed in a CX program. He disagreed. I told him about the past two dozen programs we’ve conducted with similar companies and judging by the growing length of his pauses, he was beginning to hear me.
This is what I told him:
“There are two principal things a CEO can and should influence when it comes to producing CX program results: your strategy (the plan for centering the company around the customer), and your ability to execute that strategy through the engagement of your leadership and teams. However, whether you call it a strategy, a goal, or an improvement effort, (just don’t call it a project!) you, as a leader, must drive it. You, the CEO, must get and stay involved in order to significantly move your team or organization forward. Your lack of involvement sent the message that it wasn’t important- a message that was clearly received by your staff. What happened in the past two months, in addition to the other past failures, was a colossal waste of time and money.” (He admitted that the company had spent over $18 million over the past five years trying to ‘get CX working’ across three attempts.)
Simply put, I told him that he had the time, money, and authority, to make a CX program successful. It was all up to him. He laughed and said, “I don’t know about the time. We’re pretty short on that end,”
and then, “I guess if I order it to happen and play along, I would have more luck.”
I responded by saying that he couldn’t just “order it to happen” or merely “play along”; executing a CX program requires getting his people, virtually everyone in his company, to take the time necessary to do some things they’ve never done before. I made it clear we have succeeded with 100% of companies like his when we were able to create the conditions necessary to make it happen. He asked the perfect question, “What failed this time?”
I replied as simply and diplomatically as I could- culture.
He responded, “You’re kidding me. What are you seeing that we don’t see? Our culture is outstanding!”
I told him that we had noticed a few important cultural issues that we knew were going to imperil the initiative.
- Disengaged leadership. Disengaged leadership begets disengaged employees. When employees see their leaders dismissing initiatives or joking about them being one of many competing ‘arts and crafts projects,’ the low water mark is set, and people set their objectives based on how little they can get by with, as opposed to how much they could accomplish. This comes from the CEO level and works its way down. I mentioned two troubling observations which showed me that leadership was disengaged. First, one senior leader called the organization’s CX initiative “the lowest priority to-do item” in front of the whole team assembled to execute CX. Second, in two separate meetings, while the Deloitte consultant and our team were meeting to mesh tactical approach, several of the organization’s mid-level managers were bragging about how overworked they were to several new employees. They even talked about how they needed to get divorces because their new spouses were the managers they reported to and that they were more than likely to be abusive relationships. The new recruits were horrified and one of them actually came up to a member of our team and asked if we were hiring. I would be hard-pressed to find a more toxic example of a culture of disengaged managers doing direct harm to the company.
- Credit-starved hierarchies. The most important thing to many of the people involved in the effort was receiving credit. When senior leadership absorbs the credit for the ideas and actions of their direct reports, their direct reports become disengaged and lose all respect for their leadership. In turn, those people end up doing the same things down the line to their direct reports and it becomes a very ugly cycle that’s hard to break. Eventually, you don’t have a support structure; you have an intellectually-depleted, credit-pillaging culture where no one is incentivized to innovate. All the while, the top four or five people unwittingly allow the cycle to run.
- The day job. The real enemy of CX execution was the company’s total focus on the day job. On its face, this sounds completely ridiculous. However, relentless focus on the day job, to the exclusion of everything else, robs from you the balance required to move your company forward. Even the most successful leaders fail to create balance between the demands of the day job and the diverse initiatives required to meet new goals, because the two are so different and they compete relentlessly for everyone’s time, energy, and attention. In the quest to get what feels like the most important work done on any given day, triage to keep everything afloat until tomorrow usually takes precedence over a new strategic initiative. The day job is obviously urgent, and it acts on you and everyone working for you every minute of every day. After all, it’s what they believe they are there for, right? Once executives become aware of this imbalance or struggle, they will see it playing out everywhere, in any team that is trying to execute anything new. Executing in spite of the day job means overcoming not only its powerful distraction, but also the inertia of “the way it’s always been done.”
- Dueling strategies. I added that everyone involved in the effort was trying to use two somewhat contradictory strategies from prior management consulting engagements. One covered strategy in a disjointed theoretical manner, while the other focused on best practices in measurement. Neither strategy was developed specifically for the company at hand. I mentioned that our team had spent weeks with the two business analysts and had helped to refine a unified approach from the two disparate sources of strategic direction they had paid for previously—but not without fairly dramatic overhauls. The two BAs agreed that one unified strategy was necessary and had been missing, yet they feared no matter how strong and intelligent the strategy, it would all break down in execution.
- De-emphasizing execution. At this point, the CEO chimed in, “Why did they fear that it would break down in execution? We’ve been executing stuff a lot more complicated than CX for seven decades—their comments surprise me.” I replied that execution rarely breaks down because the company lacks the knowledge. Execution always breaks down from 1) lack of clarity of the objective; 2) poor communication of the objective; and 3) lack of senior-level support, sponsorship and involvement in the initiative. Poor execution comes from people who, because they’re not receiving appropriate communication from leadership, don’t understand the goal they’re supposed to execute, why they’re supposed to execute it, and the payoff for working hard to make it successful. I went on to say that on average, only one employee in seven (15%) could name even one of their organization’s most important goals, let alone the execution tactics to make it succeed. The reality is employees are far less engaged than CEOs will ever know. The further from the top of the organization an employee is, the lower their clarity on company-wide objectives.
- Lack of commitment to the goal. Often, even those with understanding of the goals and objectives lack the commitment to achieve them. Typically, only 49% of employees can say they’re passionate about the goals their team is responsible for achieving—which leaves the other half simply going through the motions until it’s time to go home for the day.
- Accountability. A staggering 81% of people in the average organization claim they are either not held accountable for attaining the company’s and/or team goals or the goals lack significant clarity for them to consider them. Furthermore, employees cannot translate larger org goals down into specific, executable actions that make any sense to them. Under normal circumstances, 87% of employees have no clear idea what they should be doing to achieve the company’s goals. The issue is execution and communication. How can anyone become accountable for something that they don’t understand, know how to do or how it fits into their role or the org’s larger picture?
Operating one level beneath these seven startling cultural realizations were additional problems with lack of trust, misaligned compensation systems, poor development processes, and poor decision-making at the all levels of the management hierarchy.
I could tell the CEO was tired of hearing about everything bad that we had noticed about his company. I quickly shifted to the positive by emphasizing what I thought were the most important steps he could take to remedy the problems he had before him.
We suggested a series of leadership training workshops for all senior leaders in the organization addressing all the issues we had uncovered. In order to make it most successful we required the CEO to participate in each session along with all of his direct reports and those at least two organizational layers below them. He agreed. While scheduling was complicated, we successfully ran their executive teams through several workshops and prepared an opening statement for the CEO to deliver at the beginning of each workshop to drive home the importance of getting this right.
Six months later, at the conclusion of the first array of leadership training, our team agreed that we will hit reset on their CX initiative, this time to be led by none other than the company’s CEO.
The one thing that this CEO said that stood out to our team near the end of the leadership training workshops was, “Every company is dysfunctional. We certainly were far more dysfunctional than I or my team had allowed ourselves to believe. But dysfunction isn’t necessarily a bad thing—it’s a reality we just have to deal with. The best thing we’ve done in the 21 years I’ve been at this has been to pull together the courage to stop and listen to what outsiders keep telling us and do the work on ourselves we have so desperately needed. Outsider consultants are good, but they cannot change for us. We have to do that ourselves. But let’s just acknowledge that we wouldn’t have found our urgency on our own without them.”
He was right. We have echoed those sentiments for decades. Consultants cannot execute your change. The company has to do that when they are ready. Sometimes the greatest value consultants can have is their ability to grab a mirror and hold it up to a company’s leadership.