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Modern CFM: How to Gain Business
Benefits from Customer Feedback
Jukka Hekanaho, PhD and Federico Cesconi
This paper is brought to you by:
About CustVox
CustVox AG, is a global specialist in Customer
Experience Management (CEM). The company’s
high performance solutions are designed to
measure and report on customers point of view,
capturing insights on touch-point-experiences
when and where they occur, and delivering them
continuously in real-time.
[email protected]
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This paper is brought to you by Custovox
Jukka Hekanaho, PhD and Federico Cesconi
// White Paper
Table of contents
Executive Summary
Definition of Customer
Feedback Management
The Process of CFM
Criteria of Modern CFM
A Maturity Model for CFM
About the Authors: Jukka Hekanaho
About the Authors: Federico Cesconi
Executive summary
Customer Feedback Management (CFM) is the
core component of any customer-centric business
strategy aiming to improve customer experiences.
The purpose of CFM is to understand what kind
of experiences customers have with the company
and to use this understanding to improve the
CFM used to mean a static, one-shot,standard
market research survey. However, in today’s fastmoving, interactive, multi-channel world this gives
no longer organizations a competitive edge. Instead, what is needed is a holistic company-wide
practice that captures, analyses, and integrates
feedbacks in real-time and over all touch points
and customer situations, thus enabling a fast 1:1
response and an effective dialogue with custom-
1. Do not overload the customer. Ask only feedback which is relevant to customer’s situation.
2. Make giving feedback easy and natural.
3. Build a 360 degree view. All touch points, all
kinds of customers, and all kinds of situations.
4. Collect all types of data, including free text
answers and voice recordings.
5. Never discard feedback.
6. Produce actionable insights of the feedback.
7. React to feedback and do it fast. The customer is waiting.
8. Use feedback for continuous enterprise improvement.
ers. Needless to say, this is not an easy task.
9. Measure and manage the whole CFM process, especially the outcomes.
To succeed organizations need to build a modern
Remember, feedback is a free gift from your
CFM practice that satisfies 9 criteria, which collectively enable organizations to effectively use
customer feedback to enhance customer experiences and to improve bottom line:
customer. Use it wisely, show that you value his
feedback and you have already taken the first
step to improve the loyalty of the customer. Do
this systematically, on an enterprise-wide scale,
respecting the criteria above, to build a customer
experience management practice that improves
your bottom line through increased loyalty, higher
share of wallet, and increased word of mouth.
iii | Executive Summary
Customer Experience Management (CEM) is a
phrase which seems to be on the lips of almost
every marketing professional. An increasing
number of senior managers have CEM on their
Yet although more and more business leaders
seek growth through an increased focus and
investment in CEM, most companies are still
struggling to turn their CEM initiatives into action-
agenda as a tool to be implemented to improve
able business practices, which bring benefits to
customer service delivery and the competi-
the company. A more startling fact is that the cus-
tive position of their company. There are sound
tomers of many businesses are not noticing any
reasons for the current popularity of CEM. In
change in the customer experience. In fact, recent
fact, several recent studies, e.g. (Stratify Group,
observation shows that whilst 56% of CEOs do
2010),(Boulanger, 2008) (Temkin, 2009)
think their company is customer centric, only 12%
(Zabin, 2008), have shown that increased famil-
of their customer base agrees (Hunsaker, 2010).
iarity and intimacy with customers and a better
This is just the last observation in a long chain of
customer experience delivery drive customer
results that demonstrate that most CEOs depend
loyalty, recommendations and wallet share.
entirely too much upon internal KPIs, and are not
receiving relevant outside-in view of the customer
As all these factors have a clear impact on the
experience, which is required to guide their busi-
bottom line, customer experience is not just about
ness towards a more customer centric direction.
being nice towards the customer. Customer experience is, or at least should be, a comprehensive
One of the primary reasons that CEM initiatives
business strategy that delivers financial returns
often do not perform optimally in the long term,
and improves your competitive position.
can be traced back to the way in which the power
Introduction | 01
of customer feedback is harnessed. Most often,
method for collecting customer feedback, but, in
customer feedback is collected in a static way,
our view, this is just the initial phase of CFM and
not respecting the customer’s process with the
comes short of the full impact that CFM should
company. In addition, the feedbacks are not rigor-
have. Companies do not, or at least should not,
ously analyzed and the insights are not system-
ask for customer feedback just to collect it. No,
atically turned into practical actions. All these
like the name says CFM is about ‘Management’
facets inhibit the effectiveness and the actual use
of feedbacks. Hence, CFM refers to the way feed-
of customer feedbacks and lead to deficits in the
back is queried, collected, stored, analyzed, mea-
customer experience delivery.
sured, reported, managed, and how it is finally put
This white paper discusses the modern use of
Customer Feedback Management (CFM) as the
key component of a viable CEM solution, and the
role of CFM in a successful customer management scenario.
Definition of Customer
Feedback Management
The purpose of CFM is to understand what kind
of experiences customers have with the company
and to use this understanding to improve the
experiences. Some people view CFM only as a
into practice to improve the customer experience
The Process of CFM
In order for a company to deliver an exceptional
customer experience, it needs to understand the
wants and needs of different kinds of customers,
across a range of potential interactions.
The required level of sophistication, including
the capture of a proper level of data at the different touch points and at different stages of the
customer’s process, cannot be accomplished by
02 | Definition of Customer Feedback Management / The Process of CFM
a simple ad-hoc customer survey. The business
needs to continually listen to the voice of its customers, keeping their finger upon the pulse of the
customer’s experience. In addition, the feedback
needs to be analyzed and turned into actionable
feed internal systems, making the relevant information available to the right people, so that they
make the right decisions to improve the customer
experience. Only then can you gain business
benefits from the feedbacks.
insights. After which, the findings must be used to
Figure 1: CEM Framework
The Process of CFM | 03
In order to characterize the use of customer feed-
• Analyze – By performing analysis upon gath-
back, we use the CEM framework in figure 1.CEM
ered feedback, together with other internal
can be enabled by implementing a simple five
customer data, using methods such as simple
step process, broadly defined as capture, analy-
statistics, data mining, text mining and social net-
sis, integration, improvement and measurement.
work analysis, the business gains insights about
(Cesconi, 2011) This framework can be further
experience and what drives it.
defined thus:
• Integrate – Using the results of the analysis,
• Capture – By encouraging feedback via a
the business interoperates the results, and deliv-
variety of means including surveys, touch points
ers actionable insight for the right persons.
and text mining, the enterprise gathers customer
04 | The Process of CFM
• Improve – At this stage the business attempts
to close the loop with the customer by reacting to
his/her feedback. In addition, the business improves the overall customer centricity by enhancing processes, systems, and attitudes in the enterprise using the wide range of insights gained.
customer experience delivery may vary depending on place and time. All these factors place
certain requirements on modern CFM that we will
define and discuss below:
1. Ask only feedback which is relevant to the
customer’s situation – Feedback needs to not
• Measure – Using a variety of KPIs both inside
only be relevant (otherwise the customer will not
out and outside in, including measures of custom-
be engaged enough to actually provide feedback),
er satisfaction like Net Promoter Score or Cus-
it needs to be captured soon after the interaction
tomer experience Index, to create a 360 degree
with the customer takes place, preferably imme-
view of the customer experience to continually
diately. Hence, feedback should be collected as a
monitor and improve CEM.
constant stream from the customers, not a single
static one time survey.
Criteria of Modern CFM
2. Make giving feedback easy – Avoid compliIdeally, CFM should be utilized to understand
cated time consuming surveys and always allow
what the customer needs and to fine tune the ex-
the customer to choose their preferred feedback
perience delivery to fit these needs more closely.
channel, e.g. e-mail, web forms, SMS, IVR, call
This is, however, not a simple task. Customers
center. Allow also some form of free text capture.
differ, as do their needs and expectations. Also
Above all, enable the customer to leave feedback
the touch points are different and the quality of
whenever they wish to.
Criteria of Modern CFM | 05
3. Build a 360 degree view – Aim to collect and
5. Never discard feedback or fail to integrate it –
understand the customer’s feedback in every situ-
This means storing historical customer feedback
ation. This includes all touch points, which should
in a centralized data warehouse. Data will need to
be captured and analyzed in every relevant situa-
be integrated into other business support systems
tion. Often the most simple touch points, e.g. bills,
including CRM and ERP. Build a history of feed-
are forgotten. These can, however, be of great im-
back on a customer scale, and a timeline of how
portance to the customer. Collect feedback from
the customer relationship evolved.
all kinds of customers; do not be tempted to make
specific selections of customers based on your
6. Produce actionable insight – The purpose of
own assumptions, collect feedback across the full
feedback analysis is not to produce reports, but
range of customers to develop an all-encompass-
to produce real actionable insights that can be
ing view.
effectively used to improve the customer experience. Criteria 1-4 above outline a process which
4. Collect all types of data – Utilize all types
enables the business to collect a wide range of
of data; discard none, for example satisfaction
information across a number of touchpoints. In
scales, numeric answers or free text comments.
addition to the actual attitudinal feedback, the
Often open ended free text comments of custom-
business needs also to combine structural infor-
er are not analyzed and used to their full potential.
mation, like socio-demographic information and
But these are of great importance and give you a
customer value. Furthermore, the nature of the
hands-on feeling to the customer pain points.
feedback collected from each channel will often
be quite different. Therefore, the level of analysis required to produce real, actionable insights
06 | Criteria of Modern CFM
based on this data should not be underestimated.
The business needs to apply modern analytical
techniques such as driver analysis, data mining,
text mining, trend analysis and analysis of social
network activity to exploit and benefit from all of
the feedback collected across these channels.
gathered and correlated, it will need to be delivered to the person responsible for dealing with
the customer, to enable them to resolve the issue
in the best possibly way, and to interface with the
customer on a personal level in a professional
Analysis of customer feedback is not a mission
impossible, but it needs to be approached in a
structured way using modern analytical methods.
Above all, there is a need to be goal directed
during the analysis phase. Focus on the major
customer issues, find out the underlying reasons
and fix them.
7. React to feedback – Analysis and resolution
of any issues which customer feedback highlights,
should be dealt with quickly, and on a 1:1 basis.
Integration with other business systems such as
CRM or your call center systems will be required,
so that other relevant information can be gathered
and correlated to complete the customer’s overall
picture. Once the relevant information has been
Criteria of Modern CFM | 07
8. Enterprise improvement over time –
A Maturity Model for CFM
CFM should be used to streamline and improve
the customer experience delivery the business
CFM has come a long way in the last few years.
provides over time. This will involve the analy-
The initial ad-hoc style market research has
sis of all customer feedback, to derive the main
now evolved into adaptable solutions to capture
drivers of a good customer experience. Business
customer feedback and to enable the voice of the
processes, systems, workflow, strategies and
customer across a multitude of touchpoints and
architecture will need to be improved iteratively
across different customer situations.
based upon these analytical findings.
However, to improve its CFM a company must
9. Measure and manage – Constant monitor-
first assess the current maturity level of its CFM
ing of the drivers of good customer experience
and decide what needs to be done to move to the
enables you to know how your CEM initiative is
next level. We can use our five-step CEM-process
developing. Use the insights gathered from feed-
from figure 1 to demonstrate how companies
backs and define the drivers of customer satisfac-
can assess the maturity of their CFM and what is
tion. Take these drivers and develop them into a
required in order to move into the next level.
range of KPIs which can be used to measure the
customer experience delivery.
The resulting 4 stage maturity model is shown in
figure 2, where we move from a company driven
Be sure to build dashboards for all relevant
static feedback into a deep customer interaction
management levels, as well as for employees in a
based feedback management. Let us have a
customer facing support role.
closer look at the levels:
08 | A Maturity Model for CFM
• Level 1: Aware – This is the starting point for
companies. They acknowledge that they need
to know more about their customers and start to
gather information about them. Usually, the first
step is a standard market research satisfaction
survey, i.e. a static, single-shot, sample based
mous in its approach. Being quite general and not
customer specific, it normally does not produce
any actionable results. Additionally, returned data
is traditionally analyzed using simple statistical
analysis methods, with little interpretation of what
the business (and customer) context is.
collection of customer feedback, entirely anony-
Figure 2: CFM Maturity ModeL
A Maturity Model for CFM | 09
• Level 2: Understand – At this level compa-
• Level 3: Interact – At this level companies
nies want to measure and understand customer
make a quantum leap. They become reactive.
satisfaction. This is typically done using a regular
They go beyond capture and analyze and start
yearly / bi-yearly / quarterly customer satisfaction
putting feedbacks into actionable actions. To do
survey. The surveys are clearly more focused on
this, they deploy a fully interactive CFM solu-
different touch points or on specific topics which
tion with ongoing capture of customer feedback
are doomed to be important for the customer
across multiple touchpoints and in different situ-
ations. This is followed by a deep analysis of the
feedbacks and enterprise improvements based
The analysis is lifted to a new level by analyzing
on the findings.
the drivers of satisfaction using valid statistical
methods. The results can be actionable at a gen-
The companies also integrate the feedback pro-
eral level and do, in best cases, lead to improve-
cess into their systems and processes and trigger
ments of processes and services at the touch
suitable 1:1 interactions with customers, hence
points. At this level companies have a regular,
closing the feedback loop. On the measurement
although restrictive, capture process in place. The
side, they apply a sophisticated combination of
analyze part is also done at a reasonable level.
internal and external KPIs, based on a correlation
analysis of satisfaction drivers.
There is a general improvement and measure
process in place for the touch points. The biggest
• Level 4: Involve – This is the highest maturity
lacks of at this level is that feedback collection is
level of feedback management. Companies at this
not linked to the single customer and that there is
level treat customers as partners in a dialogue.
no effective integration to allow 1:1 response to
They involve customers and their feedback in all
10 | A Maturity Model for CFM
aspects of business, from product development to
branding and from customer service to back office
processes. Feedback is a part of daily business
and all effort is made so that it is easy and natural
for customers to give feedback. Customers are
Each step towards a mature CFM process brings
benefits, but requires also a more concerted approach of the organization. We can clearly see
that there are major obstacles to overcome at
each stage of the development of an effective
not bothered with long and complicated surveys,
CFM practice. However, the further up the curve a
instead they are asked to give short specific,
company is, the stronger the company’s ability to
open ended feedbacks, immediately after their
compete and prosper because it is better able to
interaction with the company.
gather, manage and act on strategic and tactical
feedback. (Nash)
Feedbacks are analyzed using sophisticated data
mining and text mining methods and are automatically channeled to the right person for an appropriate reaction. There exists a clear definition
of customer experience that the company wants
to deliver based on the analysis of customer
feedbacks and other customer information. This
definition is well-known and used throughout the
organization. On the measurement side a set of
relevant internal and external KPIs are used and
it is understood what factors of customer experience drive satisfaction and how this links to the
bottom line.
A Maturity Model for CFM | 11
CEM without insight into what customer expecta-
to make it a powerful, adaptable way to manage
tions and experiences are is nothing worth. And
customer feedback. By now the benefits that be-
the best way of getting this insight is through
come available to a business as a result of imple-
direct, unfiltered, raw customer feedback. So
menting advanced CFM within the enterprise
obviously, CFM is a key enabler of CEM, giving
should be apparent. These benefits include an
crucial inputs for customer experience definition
increase in revenue due to customer loyalty and
and design.
satisfaction, as well as the ability for the business
But modern CFM is much more than an input
source for CEM. CFM defines the way in which
the business interacts with its customers, both
through the 1:1 response and through the enterprise improvement process. Hence, CFM
becomes an integral part of the customer experience delivery. With modern customer management methodologies, customer feedback must be
seen as a crucial component making up a vital
part of the customer experience.
We have taken a close look at the way in which
modern CFM works, how the operational model
looks, and the key components which combine
12 | Conclusions
to monitor and modify its customer experience
delivery based on proven real time data.
Day in and day out, your company delivers customer experiences. Perhaps they are positive
and meaningful, or perhaps negative and boring
for your customers. If you never asked for customer feedback, the changes are that you are not
delivering the great experience your customers
want. The only way to find out the truth and to
start managing these experiences is to put a professional and structured feedback management
practice in place and use it to drive improvements
in your customer experience management.
Jukka Hekanaho is the Chief Customer Officer of
largest global banks. The analytical CRM solution
CustVoX (, a leading provider
and practice of Credit Suisse developed by Heka-
of Customer Experience Management consulting
naho and his team has been elected a benchmark
solutions. CustVox provides both consulting ser-
in banking industry.
vices in customer experience management and an
industry leading real-time Voice of the Customer
Jukka Hekanaho has over 15 years of experience
platform for capturing the customer feedback.
in data mining, client analytics, CRM, and customer
Jukka Hekanaho was appointed to his current po-
experience management. He started his career as
sition in March 2011 with the responsibility of both
a data mining researcher and has developed 2
customer solutions (consulting) as well as client
novel genetic algorithms for solving complex data
insight and analytics.
mining problems. During his academic career he
has worked in Åbo Akademi University and Torino
Prior to joining CustVox, Mr. Hekanaho worked as
University and earned his PhD in Data Mining from
management consultant supporting companies to
Åbo Akademi University.
define and implement Customer Experience Management solutions. He has also 10 years of senior
You can contact Jukka Hekanaho on:
management experience in the financial industry.
[email protected]
He served as Head of CRM in Bank Sarasin, a
leading Swiss private bank. Also, he has served as
Head of Data Mining in Credit Suisse, one of the
About the Authors : Jukka Hekanaho | 13
Federico Cesconi is the CEO of CustVox
Federico has more than 15 years of experience in
( CustVox is a leading provider
marketing analytics. He served as the Marketing
of real-time systems that automate capturing the
Manager at Tinet SA, one of Southern Switzer
voice of the customer and measuring customer
land’s leading Internet Service Providers, where he
satisfaction and loyalty.
was responsible for database marketing and data
mining. After joining Cablecom Ticino in 2000 as
He was appointed to his current position in No-
Marketing Manager, in 2002 he moved Cablecom
vember 2010 with responsibility for both business
corporate headquarters in Zürich as the Head of
insights and the customer insights area.
Customer Information Management.
Prior to joining CustVox, he was Director of Busi-
Federico has won the North American Insight
ness Intelligence at Cablecom and UPC. There he
Award 2006 in Data Mining, the European Insight
was responsible for the development and imple-
Award 2007, and the 1-to-1 Gartner Award 2008.
mentation of best practices for Customer Experi-
Federico earned a Masters in Business Adminis-
ence Management and business insight across
tration from the University of Wales.
the organization.
You can contact Federico Cesconi on:
[email protected]
14 | About The Authors : Federico Cesconi
Boulanger, D. (2008). Customer Experience Management: Is your entire company really focused on the
customer. Aberdeen Group .
Cesconi, F. (2011). Customer Experience Management that Improves the Bottom Line: A Framework for
Implementing CEM.
Hunsaker, L. (2010). Customer Centricity Link to Customer Experience ROI. Von Customer Think. abgerufen
Nash, S. The Role of Feedback Management in Becomminf Customer Centric. A Customer Centricity
White Paper.
Stratify Group. (2010). 2010 Consumer experience study.
Temkin, B. (2009). Customer Experience Boost Revenue, 2009. Forrester Report
Zabin, J. (2008). Customer Feedback Management: Mind if I Ask You a Question? . Aberdeen Group.
Bibliography | 15
Modern CFM: How to Gain Business
Benefits from Customer Feedback
Jukka Hekanaho, PhD and Federico Cesconi
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