As Joseph Pine and James H. Gilmore stated in the 1998 article “Welcome to the Experience Economy”: “From now on, leading-edge companies, whether they sell to consumers or businesses, will find that the next competitive battleground lies in staging experiences.” The experience thus becomes the relevant unique selling point that is decisive for the success of a company.
Today’s most important companies are experience companies as customers are no longer just buying products but also experiences.
Brands such as Apple, Amazon or Tesla have the highest revenues, strong customer loyalty and prevail in the war for talents. They are at the heart of the major value-adding ecosystems.
In order to thrive in the experience economy, businesses, regardless of their size, must first embrace digital transformation.
All important processes within the organization must first be digitized (e.g., digital employee file with contract documentation, salary increase letters, training certifications, etc). It is only through the digitization of such processes that user experiences can be collected in the form of real-time feedback, also known as the experience data (X data).
Connected Enterprises and the Experience Gap
Moving from service innovation to experience innovation, which focuses on the holistic benefits of the B2B environment as well, requires a fundamental rethink.
The evolution of businesses into connected enterprises, as well as the decision to align the front, middle and back office in a stakeholder-oriented manner, form the basis to this development.
The first step in this transformation is building an awareness of the so-called experience gap. This describes the divergence between the expectations and experiences that stakeholders have with a company.
The greater the difference, the more serious the consequences: Loss of trust, staff turnover and declining readiness to recommend the business are only the tip of the proverbial iceberg. In the worst case, business continuity may be at stake.
O and X Data
Experience companies are already collecting X data and linking them with inventory data, also known as a form of operational data, or O data in short, to generate real and measurable added value for the organization.
O data, which is primarily quantitative, operational data collected over many years, cannot provide information about the very personal ideas, opinions, expectations and perceptions of stakeholders. O data can only relate what has happened in the past.
On the other hand, experience-related data is required to build the experience associated with any company into a relevant unique selling point, and thus overcome the experience gap: data(experience/emotional data). This provides information on the expectations of the stakeholders and their experience with the company. X data puts organizations in the position to create customized experience worlds.
SMEs in Southeast Asia Challenged by Digital Transformation
While digital transformation is an important agenda for small and medium-sized enterprises (SMEs), significant challenges still remain across Southeast Asia.
According to an Ernst & Young (EY) report surveying 370 SMEs across Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam, over half (54.9 percent) are in the early stages of digital maturity, with digitalization programs remaining largely unaligned with the broader enterprise strategy and multiple initiatives running in parallel across business functions.
The top three challenges regional SMEs face are a lack of access to digital talent (64.7 percent), pressure to focus on the short-term benefits of digitalization (64.7 percent), and digital risks (64.4 percent).
Challenges aside, SMEs across the Asia Pacific region are still largely hopeful, with 84 percent recognizing the need to use digital technologies to become more competitive and take up opportunities created by the digital economy, according to the IDC 2019 Future SMB Pulse survey.
Digitization and Experience Management – Seven Golden Rules for Success
To achieve optimal results in experience management, which is vital to enabling digital transformation, enterprises need to know the expectations and needs of their various stakeholders, and focus on building an awareness for dedication to the cause across the organization.
Here are the golden rules for success:
Stakeholders – the unknown entity
Get to know your employees, suppliers and partners, and you will come to realize that the quality of the relationship with your customers is not the only critical factor for the success of your business. You must understand the different expectations and needs of your stakeholders and how you can ideally satisfy them.
No blind obedience
A stakeholder-centered strategy does not mean meeting or even exceeding expectations. As a company, you are primarily committed to your entrepreneurial and economic interests. If your business model is at risk, even the most euphoric stakeholders will not come to your rescue.
You are more than the sum of your parts
Build an awareness of the fact that your entire company is behind every single point of contact from the perspective of your stakeholders – whether you like it or not. Ask yourself which decisions and actions taken by staff, from management to trainees and from IT support to press spokespersons, have an impact on stakeholder perceptions.
Keep up to date
Do not focus excessively on what your stakeholders want today. Keep your ear close to the market and your network to spot new trends early and integrate your insights into your day-to-day operations as quickly as possible.
No more data silos
Tear down existing data silos and combine a range of data pots. Only the combination of O and X data will yield truly reliable data forecasts and insights.
Measuring is mandatory – but please do it properly
Build an understanding of the fact that satisfaction can never be fully quantified. Combine quantifiable metrics (e.g. Net Promoter Score, Customer Distress, Customer Effort Score) with findings from subjective surveys (e.g. from telephone interviews, online surveys, personal interviews).
Bundle your knowledge
Use systems that inform you of changes in real-time, thus enabling you to centrally make, manage and consistently deliver stakeholder-related decisions and actions across all channels.
