A female customer rating her digital experience

How Digital Transformation Improves the Customer Experience

Discover the connection between customer experience and digital transformation and why every transformation starts with the customer.

A female customer rating her digital experience

Table of Content

    Whether you know it or not, your customer experience and digital transformation strategies are one and the same.

    Customer expectations have always been the driving force behind digital transformation initiatives (at least the successful ones). See, at its core, digital transformation is all about using technology to keep pace with ever-evolving (and ever-escalating) expectations.

    And – even when it seems like the goal is efficiency, cost-cutting, or increased profitability, the primary concern of digital transformation is achieving those goals by improving the customer experience.

    Here, we examine the powerful connection between CX and DX and why every transformation starts with the customer.

    The Link Between Digital Transformation and Customer Experience

    According to ClearAction founder and CX expert, Lynn Hunsaker, CX innovation is about creating mutual value for anyone that fits into the broad definition of a customer or end-user.
    In order to pull this off, Hunsaker explains, companies must address the customer’s “jobs-to-be-done” on a holistic level.

    Obviously, your main focus is on the customers or clients you serve. But – it’s important to understand that employees, partners, and other stakeholders with real skin in the game are part of this “end-user” group, too. It’s just that their needs and requirements are determined by the customer’s needs and requirements. So, DX initiatives are often all about empowering employees to meet (ideally, exceed) expectations and deliver consistently great customer experiences — at every touchpoint.

    For example, modernizing legacy systems goes a long way in supporting your teams. It enables employees to better support and engage with customers, communicate and collaborate with colleagues, and use data to drive positive business outcomes. Think – expanding product and service offerings, providing faster, more effective service, and creating personalized experiences that feel both authentic and relevant.

    Transformations can also take place behind the scenes. Think – automating endpoint protections or embracing passwordless log-ins across your entire network. While modernizing security solutions may not directly impact the customer experience, these investments prevent them from becoming victims of credential theft, ransomware attacks, and data breaches.
    They also protect your brand from experiencing the devastating fallout of a high-profile cyber incident.

    Data-Backed Use Cases, Real End-User Needs Drive the Entire DX Strategy

    Mercer Transformation Leader, Melissa Swift told Enterprisers Project that the pandemic has forced business leaders to look at DX with the “problem-solving focus” it’s deserved all along. She says perceptions among IT and HR pros are shifting away from the tired “spoiled employee” narrative linked to demands for best-in-class tech and are increasingly seeing these investments as critical to daily operations.

    Swift also notes that post-COVID, more CIOs are prioritizing projects like expanding customer support through intelligent chatbots, eliminating redundant systems and processes, and building business resilience through automation.

    But – all DX initiatives must align with the overall business strategy and address a specific problem or need that can be backed up with hard data and real customer feedback.

    Essentially, you’ll want to provide some kind of tangible evidence that this solution is the best bet for both solving for end-user needs and achieving a specific (and measurable) goal.

    IDG’s ebook, New Era of Data and Analytics provides a detailed example illustrating how businesses might use data to inform internal DX initiatives.

    In it, hypothetical decision-makers were tasked with building a new workplace model better aligned with the realities of hybrid work and capable of meeting social distancing requirements during the post-lockdown, pre-vaccine phase of the pandemic.

    They began the process by gathering data to help them understand the parameters of the project – drawing on employee preferences, business requirements, measurements, and current space utilization data (and COVID requirements) to inform their designs.

    From there, they used predictive modeling to analyze different variations of their design to determine which option best aligns with their goals. In this case, that meant balancing reputational and operational risks and opportunities to maximize savings with employee and customer requirements.

    Finally, decision-makers used metrics like cost per person, peak workspace utilization rate, and utilization by group to track usage patterns and ID even more improvement opportunities. Think – using sensors and occupancy data to control heating and electricity use (and, in turn, reduce energy costs). Or – building a simple app that allows employees to book workspaces (and easily comply with capacity limits).

    Tech Transformations Unlock Trust, Empathy, and Human Connections – at Speed and Scale

    Constellation Research VP & Principal Analyst, Dion Hinchcliffe calls the “seamless customer experience” the most discriminating factor for determining how a business performs in a “turbulent” digital landscape.

    Hinchcliffe says companies can survive by evolving at the rapid pace of change. Or, they can thrive – using bold, data-driven actions and out-of-the-box solutions to disrupt their industry and gain an edge over struggling competitors. The third option is a bit dark – laggard companies fail to act, fall further and further behind, and eventually, they die.

    This particular warning dates back to 2019, and arguably, it’s a timeless reminder that losing sight of the customer comes with real peril. That said, it also conveys how high the stakes were before the pandemic.

    Unsurprisingly, experts interviewed in a 2020 IBM report, agreed with Hinchcliffe, stating that DX initiatives must directly translate to improved customer outcomes.

    Post-COVID, digital standards (and stakes) have never been higher – nor have conditions ever been more turbulent. Today’s customers expect seamless omnichannel experiences, digital payments, self-service options, and personalized, high-quality content and solutions – delivered with the same consistency and speed across all touchpoints.

    According to an Acquia CX survey, 90% of customers want a convenient experience when they interact with a brand online. 90% of that group also said that most brands fall short of expectations. Additionally, 80% of customers believe technology should have a positive impact on their experience with brands.

    A recent Gartner poll indicates that brands are on the same page. Researchers found that 74% of orgs believe that creating a seamless customer service journey is either “important” or “very important” when it comes to growing their business. Yet, only about half of those participants believe their company makes it easy for customers to find information and solve problems on their own.

    While rising expectations and a complex business landscape present new challenges for brands, IDC Program VP for Digital Strategy & CX Alan Webber points out a silver lining in the report.

    He says we’re just now reaching a point where we can use technology to be more empathetic with customers — at a speed and scale that, until recently, was completely unheard of.

    Already, savvy brands are using technology to enhance soft skills like empathy and problem-solving.

    For example, Campari Group wanted to create a more expansive customer experience across its portfolio of 50+ premium spirits brands – something that resonated on a deeper level than just “taste and flavor.”

    The company leveraged the combined capabilities of D365 Marketing, Customer Insights, and Power Apps to build a real-time customer journey orchestration solution – with the goal of bridging the divide between digital and in-person experiences. As a result, it was able to use existing data to serve up personalized recommendations, unique bartender trainings, and access to exclusive in-person events.

    At one event, guests were given handheld tablets loaded with custom apps designed to capture real-time feedback from customers. Live employees there, mostly to mingle with guests – but also to help them record responses with the tablet. From there, the AI-enabled app used customer responses to generate a custom script (in their native language) and recommend “next steps” based on individual preferences.

    Webber adds that companies that demonstrate true empathy during times of crisis, customers will stick with you for the long-haul.

    While business-driven empathy has become a bit of a coronavirus cliche, it should be a long-term priority – crisis or not. It doesn’t matter if you’re helping clients navigate this year’s uncertain climate or designing experiences that aim to delight and engage your audience – empathy allows you to tap into the end-user mindset and consider key pain points and priorities from their perspective.

    Ultimately, it’s that deep understanding that allows you to deliver experiences that have real value.

    Final Thoughts

    Bottom line: digital transformation is always driven by the customer.

    It doesn’t matter if we’re talking about improving service quality, expanding product offerings, or something like document automation – the voice of the customer informs the strategies, actions, and investments that define your DX strategy.

    Whether you’re looking to enhance your CX strategy with Dynamics 365 Customer Insights, enable your employees to provide better service, or keep customers safe in the cloud, Velosio’s Microsoft experts are here to help. We’ll help you digitize processes, migrate to the cloud, and make the most out of the customer data you’re already sitting on. Contact us today to learn more.

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