Marketing, sales (CRM), customer experience and customer services together form the front office of a client-focussed organization. Together they provide integrated and optimized customer services, and effective and efficient cooperation between these departments is therefore of the essence.
Many organizations are struggling with front office silos and insufficient integration with departments, causing unnecessary growth impediments. Silos often go back a long time. In this article, we describe the history of the front office function and explain why customer demands have become the driving force behind the transformation. We also share the trends that will drive front office transformation, and we outline the fundamental capacities and the operating model front offices will have to compete on.
Customer services before and after the turn of the century
Customer services is an age-old principle. Customer experience took off with the first self-service shops in the nineteenth century. More than before, it led to shopping becoming an emotional experience and a form of leisure. Shoppers were able to browse by themselves, to look at the prices and to hold products and try them out.* All senses were involved, and the logical consequence was a stronger emotional experience.
Kim van Kaam
Customer & Brand Strategy
KPMG The Netherlands
In 1936, the first shopping trolleys were introduced, enabling people to buy more products in one go. This was the start of mass consumption. Client service during this period mostly centred around choice, ease, comfort and quantity. The nineteen sixties saw the introduction of the first ERP systems and the corporate world discovered the computer. Card index files were replaced by digital stock systems which were better adapted to serve the mass consumption needs of customers. From this point onwards, everything is always available, from everywhere.
Mass consumption also translated into mass communication. New media channels such as television and radio were introduced and the marketing function rapidly professionalized. As early as in the nineteen sixties, a number of companies started to fill large offices with call centre staff. This was the beginning of the customer services function which developed quickly over the years.
Sales mostly consisted of sending letters, making telephone calls and a continuous manual update of the card index files. During this period, customer focus became a key distinctive feature for companies. Whereas ERP systems started out focussing particularly on the back office functions, in the nineteen nineties we saw a shift towards the use of ERP systems for the front office functions. CRM systems became an essential part of the sales process, and marketing departments also started to use client databases to set up their campaigns. Marketing and sales started to serve the same customers, with their fields increasingly overlapping.
* Source: The evolution of customer experience 18:00-2050, Mood Media
Front office 1.0
From this point onwards, the front office consists of marketing, sales (CRM) and customer services, all working independently to achieve the best customer services and experience. Integration does not exist yet. Each client-focussed department follows its own, sequential and linear model. Marketing finds the target groups for the company’s products or services. Sales converts prospects into purchases. And customer services, at the end of the cycle, deals with customers’ complains and resolves problems to ensure retention. Each department uses its own customer and staff targets and reward systems. Technology is deployed differently within each department.
Towards the front office of the future
The rise of e-commerce and direct delivery in the nineteen nineties enabled customers to contact organizations efficiently and to purchase products directly. The sharp rise in web shops integrated with ERP systems made e-commerce successful. In the nineteen nineties, customer experience made spectacular progress as brands enabled their customers to personalize their experience or products, such as Nike with its ID concept allowing customers to design their own shoes.
- Brands are involving consumers in the development of their products and co-creation of solutions.
- The rise of service propositions in addition to a straightforward product push has become a reality.
- Companies’ partner eco systems are becoming increasingly important.
- The distinctive capacity of companies lies not only in the product they sell, but also in who they work with to optimize the customer experience.
During this period, Amazon and eBay were established, leading to a further surge in personalization.
The rapid pace of digitalization put considerable pressure on the old front office model. Although the underlying mechanisms of the front office are technologically complex, customers expect simplicity and ease. In addition to seamless interactions via the channels of their choice, they demand a simple brand with a strong purpose. An integrated customer service experience has become the Olympic minimum for them.
And that’s where it starts to get challenging.
Up until this point in time, the separate departments of the front office (marketing, sales (CRM) and customer services) never really had to cooperate. Each department has different working methods, processes and cultures. They're not working on a single customer image underpinned by a strong CRM system linked to marketing and sales activities. Even today, many organizations still apply the concept of separate front office departments with different responsibilities and working methods of dealing with customers. But that strategy has now reached its sell-by date.
Companies are right to focus on excellent customer services. It’s what differentiates a brand now. Far-reaching personalization, seamless interaction between the different channels, strong partner eco systems, brand-specific automated and personalized experiences are the minimum requirements.
It takes a lot to accomplish that. A new process organization can make a difference in improving cooperation, but a full integration of silos goes way beyond that. Transformation of the front office departments is required to achieve that, as is a multidisciplinary approach to shape customer experiences.
If you don’t take the initiative, you stay behind. But where to start the transformation of your front office, and what is feasible for your organization, and within what time frame?
Do you want to know more about the status of your front office within your organization?
KPMG helps organizations transform their front office functions, starting by the development of a uniform customer service strategy which translates into new business and operating models in linking up technology, processes, culture, people, and data & analytics through a central customer profile.
Do you want to know more about the status of your front office within your organization? And about what is needed to achieve seamless cooperation between marketing, sales (CRM) and customer services to create a uniform customer service and customer experience?