Understanding the Four P's of Customer Experience

Inforte says that when examined closely, it is clear that customer focus and the delivery of a customer experience is almost entirely derived not from technology, but from four other foundational elements: Product, Process, Policy, and People.

By No Analyst or Consultant

June 17, 2004 — CSO —

By John D. Moses,
vice president
and client executive

Over the past few years, the business, software, and consulting communities have placed a much greater emphasis on the functional nature of customer relationship management (CRM), and its complexity from a business reengineering perspective. With its origins in the sales force circa 1993, CRM has since taken the entire front office by storm, with the solution now unmistakably comprising the marketing, sales, and service functions.

More and more, however, we are seeing other important but less obvious functions being linked with CRM departments like Order Management, Return Materials Authorization (RMA), and Billing are commonly part of CRM initiatives these days. This broadening of CRM not only makes sense but also has become more feasible now that the technology is capable of integrating these systems (for example, Enterprise Application Integration or "EAI") and supporting the necessary business collaboration (for example, workflow technology).

Many people believe that CRM solutions consider customer touch points first, and then work backward to the functions necessary to support them - regardless of where they may lie within a business. While better than a technology-centric perspective, this functional view still fails to adequately capture the full spirit of CRM.

Today, CRM is generally accepted as a business philosophy which holds the customer, and perhaps more accurately, customer data, at its heart. It represents a fundamental shift in the way many companies do business. This change in perspective has ridden, or quite possibly driven, a greater paradigm shift in global business: The migration from product- to customer-centricity.

Understanding this shift is not the easiest process in the world for a couple of reasons. This article explores one of those reasons, which involves a case of mistaken identity. Companies often fail to recognize 1) the limited role that technology plays in the delivery of a meaningful customer experience, and 2) the required investment in the factors that do.

When it comes to CRM, most companies wouldn't deny they are seeking a shift towards customer focus or want to offer "a better customer experience." These are mighty words, but often the only action being taken is the deployment of software. Companies have failed to recognize that technology does not manifest customer focus. As a rule, technology does not deliver the customer experience; it just enables it.

The 4 P's of Customer Experience

When examined closely, it is clear that customer focus and the delivery of a customer experience is almost entirely derived not from technology, but from four other foundational elements: Product, Process, Policy, and People. Even when delivered over the Web and without human intervention, a customer's interpretation of their experience will be largely influenced by what they can buy, what procedures they have to follow, what rules may govern them, and what people may be reachable if and when they want personal contact.

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