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How to Align Tech with Business Ops to Delight Customers

Over just the last month, I received five separate bills from different divisions of a national service provider with multiple products. Even after I paid the last one, I wondered if another might trickle in by owl post as I crossed “pay bills” off my to-do list.

This whole experience made me think: if even this global conglomerate can’t streamline its business processes, is there any hope for smaller, mid-market companies out there with less resources and slighter bottom lines to get this right?

Indeed, mid-market financial services and healthcare companies struggle with this issue. Take community banks. Have you ever called in to yours, inquiring about  an auto loan, only to be transferred through departments, repeating yourself to reps who know nothing about your account or loan history, before finally getting your answer? (This is assuming you haven’t hung up by that time).

So what’s the deal? Why does such chaos happen at mid market firms and large corporations alike?

Maybe a company grew by acquisition, so its business units operate independently even though the company markets itself as one unified business?

Maybe its tech systems aren’t aligned?

Maybe its business ops are all over the place?

But usually it’s exclusively or additionally because that company’s different business and tech teams are swimming in their own lanes, siloed and unsynchronized.

No matter how adept its technology, a company must have as adept an architecture that maps this technology to its business operations and ultimately its customer experience.

What do I mean by architecture? Essentially a blueprint for how different business processes and tech systems work together and then match to each customer interaction along the customer experience, all the way down to customer data collection (so the business can analyze and further improve the customer experience).

A company could have the absolute best technology or the absolute best product-centered business processes, but if these technologies and processes are operating on their own islands, that company’s customer experience will be fragmented and frustrating, sacrificing revenue and profit.

Back to Budget-Strapped Community Banks  

Community banks tend to buy instead of build operational systems. Such tendency towards acquisition makes it even more critical that they align their diverse systems, map them to their respective business processes, and create the necessary integration points between them.

Some big financial institutions do a great job of such architecting. When a customer calls or walks into a major bank’s branch, for instance, a retail banker can immediately pull up a holistic, 360-degree view of that customer across all departments — her total business, her cumulative loans, and even her projected lifetime value (CLV), thanks to technical and operational prowess. And based on that CLV, the system can then direct its retail banker to either treat that customer with white gloves (if she’s worth growing and upselling) or not spin their wheels (if she costs more than she makes). Having this 360 degree view also allows seamless hand offs to specialist bankers and easy approval processes across many products.

Meanwhile, a community retail banker would have to pull up multiple systems to get just a somewhat comprehensive view of a customer before conducting a lengthy manual hand off to specialists or forcing the customer to start all over again.

So how can these community banks and mid-market companies across all industries align tech with business ops to delight customers, even without the purse strings of a top tier, multinational organization?

Here are four steps to get started.

1 — Hire a Chief Experience Officer or Chief Business Architect

While your CEO needs to commit to aligning technical and business operations, she can’t run the actual alignment process. Instead, she should hire a specific C-Suite position to do so – either a Chief Experience Officer (who will be slightly more focused on the customer experience) or a Chief Business Architect (who will be slightly more focused on the underlying business processes, especially the cross-functional ones). Regardless of the specific title, this key hire will analyze and optimize across all business lines, working very closely with the Chief Strategy and Chief Technology Officers.

I would avoid hiring internally for this disruptive role because current employees, however senior or stellar, may be too close to the current modus operandi to effectively assess and drastically improve it; they also might fail to appreciate or muster the significant organizational support needed if they’ve been in a more focused role within a single business unit previously.

Instead, target hires from external, larger companies who have done this before and are enticed by the end-to-end responsibility of the mid-market.

A candidate who has transitioned through different organizational areas of a company, such as through an MBA or professional development program would be ideal; GE used to groom professionals in this manner and large banks still transition up-and-comers through business units before settling them into one. Such rotation allows employees to get a holistic understanding of all offerings and business processes from lead generation to product servicing.

2 — Create the actual blueprint that aligns technical and business operations

Your company, led by the Chief Experience Officer or Business Architect, should take a step back and ask these broad questions:

  • What does the golden customer experience look like?
  • Where are we now?
  • Where do we need to be?
  • What are the breakpoints in our business processes?
  • What are the breakpoints in our technology?
  • How can we fix them individually and collectively?

After aligning on a common vision, your company needs to create the North Star architecture to get there in which all systems (proprietary and third-party) work in conjunction, cleanly mapping to business operations and customer experience. This North Star architecture is a living three-to-five year vision that must be broken down into incremental improvements rather than executed as a monolithic project.

This North Star architecture is also called a data fabric –  a single, unified architecture that delivers integrated and enriched data company-wide (allowing companies to immediately pull up that 360-degree view of a customer, as mentioned above and among other benefits).

Then take it one step further from your data fabric (that allows different applications to communicate easily with each other, often pulling data from an integrated data service and store) and create an integration fabric that allows a company to additionally manage processes that span these applications and business units. For example, say a lead is created in a company’s CRM system, then put into the application or order management system to be processed, and ultimately the fulfillment system to be delivered to the customer; it’s important to allow these systems to not just communicate with each other but to actually exchange data and prompt necessary action.  

3 — Create a culture of incentivized collaboration through nuanced KPIs and data-driven reasoning

Mid-market companies tend to incentivize employees to maximize their performance within their swim lanes through business unit specific KPIs; for example: bring as many prospective customers into the mortgage sales funnel as possible.

Such KPIs, though, don’t take into consideration whether a company’s underlying processes and technology can handle an onslaught of prospects or even if those prospects are qualified enough to convert into actual customers. When a company operates through such specific KPIs, it disincentivizes cross-functional collaboration; employees are encouraged to solve very specific points in the value chain without considering their overall solution and collective customer touch points, resulting in disjointed services.

Can you imagine the offensive unit of a soccer team never communicating with the defenders behind them? Sure, strikers are tasked with scoring but if they don’t sometimes help defend or at least make themselves open to receive passes from their defenders, they won’t score as consistently and the team won’t win as much.

This same basic teamwork philosophy holds true for companies as well.

Earlier in my career at a global consulting firm, I was working with a leading US property and casualty insurance company to collect data on each of their customers from different product groups. The goal of this exercise was for the client to understand its customers holistically and then strategically service, market, and upsell relevant additional products, a pretty basic go-to-market strategy.

Creating this holistic view was hard, though, because of incomplete data entry at the point of sales, which was predominantly in branch offices.

Yet when I asked the EVP of Sales to help improve this data collection (most basically by having the reps look up if customers already existed), she resisted, saying “My sales reps are not in the data collection business, they’re in the efficient sales business.”  

This executive’s resistance to helping me was not rooted in her selfishness so much as the client’s overly siloed KPIs; the EVP truly believed that collecting data would slow down her sales KPIs so resisted.

This experience made me realize I needed to do two things:

  1. Quantify how high quality data collection would help the client and ultimately the sales team, so I could tell this EVP that just one more minute of her sales rep’s time each sale could save the company $40M annually (via reduced mail cost through better household identification) and increase upsell and cross-sell potential by over 6%.  And personally, it would help this executive better hit her quota in the long run by being able to easily determine which products to upsell to which customers.
  2. Work with management to add additional KPIs for sales people that  promoted data collection and other cross-functional collaboration.

I’ve talked a lot about how sales teams can be better incentivized, but tech teams also need to be motivated to work better with business units. When creating incentive structures, remember that these tech teams tend to be less directly financially motivated and that incentives for hitting KPIs can also come in the form of promotions, recognition or other qualitative rewards.

Overall, from a change management perspective, the company vision needs to be super clear, top leadership aligned, and incentive structures adapted.

4 — Don’t be stingy: allocate a budget for architecture!

Tech teams often have a backlog of hundreds of feature requests from the business team they primarily serve. Despite this backlog, leadership often delays or ignores the tech team’s subsequent requests for data and operational integration, often citing a lack of budget or support from that corresponding business unit.

I can’t stress this enough: your tech teams and companies at large need money to not just create business unit specific features but also integrate data and processes across application and functional boundaries.

Aligning your technology with your business operations to create a delightful customer experience is easier said than done, requiring significant effort and budget.

How much budget exactly? You’ll be surprised.

You should allocate an additional 30% of your current IT budget to creating a data and integration fabric.

For example, say your annual IT budget is $30M. You’ll need an additional $10M  to launch this project and $5-$10M annually thereafter to continue running it.

So where exactly will this budget be applied?

  • Hiring and training new employees to create the business and technology architecture and the data and integration fabric
  • Buying the right new software (which then also needs to be integrated)

One way to make this overall integration process easier? Become a more scrutinizing buyer!

When assessing what software to buy before, during and after creating an integration fabric, prioritize ease of integration over aesthetics, functionality and initial cost.

Ask yourself:

  • How will this new software plug into my overall enterprise?
  • How many employees and contractors will it take to integrate this new software?
  • How much fabric needs to be built to integrate this new software?
The CTO and Chief Business Architect (or Chief Experience Officer) should always have final procurement approval.

Wrapping it up

It’s easy to celebrate where your company is specifically succeeding and chalk its corresponding failures up to uncontrollable forces. Often I hear companies bemoan a lack of alignment to the common, inevitable tension between business and tech or excuse a scattered customer experience as mere growing pains.

Yet such failure can be solved through architecture – creating an integration fabric that maps your technology to your business operations promoting a holistic, efficient and delightful customer experience.

This integration fabric can’t be built easily, but it can be built effectively by following these four steps:

  1. Hire a Chief Experience Officer or Chief Business Architect from a large company who’s done this before to oversee the integration
  2. Hire a Chief Technology Architect or task the CTO with integrating applications and data
  3. Allot an extra 30% of your current IT budget and always consider ease of integration when purchasing new software
  4. Create a culture of incentivized collaboration through nuanced KPIs and data-driven reasoning
  5. Create an integration fabric in addition to a data fabric.

Thoughts and comments? Would love to hear them - feel free to email me at oliver.halter@manifold.group.