Q: How do companies that provide a best-in-class customer experience organize themselves to be customer-centric?
A: How utilities structure themselves around customer experience (CX) is an important part of an overall strategy that might include reviewing how other utilities’ CX functions are structured and exploring how CX councils are used to engage the rest of the utility by prioritizing and governing CX efforts cross-functionally. However, we strongly recommend thinking about organizational structure as the last item in a CX strategy.
The E Source report Built to Please: Organizational Structures for Utility Customer Experience shares three common organizational structures (figure 1, figure 2, figure 3):
- CX reports to marketing.
- CX reports to a channel director.
- CX reports to a chief customer officer or equivalent.
The report also explores where the CX teams report, what functions they comprise, and the strengths and challenges faced within three utility companies (figure 4).
Even as organizational structures change (as they have in the aforementioned utilities), the five CX success factors highlighted in the report are timeless:
- Clearly define roles and responsibilities.
- Actively engage an executive sponsor.
- Cultivate CX ambassadors throughout the utility.
- Tap into process-improvement resources.
- Establish a cross-functional CX council.
CX councils for cross-functional engagement and governance
The E Source report CX Councils: Your Customer Experience Secret Weapon explains the critical role that a cross-functional CX council plays in a utility’s CX organization. The report details what a CX council’s objectives should be, what its primary activities are, and success factors (figure 5).
In the end, the correct organizational structure for CX at any given utility depends on factors unique to each utility. Structure, in itself, is an artifact of many other organizational factors. Organizational effectiveness expert Joseph Logan recommends approaching the organizational structure only after defining a few other key items:
- Strategy: What is the organization attempting to accomplish? What is the intended outcome?
- Culture: What are the expectations and behavioral norms the organization hopes to establish?
- Roles and responsibilities: What work needs to get done, and how?
- Job descriptions: Specifically, how will responsibilities be divided among different roles?
Only after these questions have been answered, according to Logan, should one begin determining who reports to whom to construct a conventional organizational structure. The E Source Customer Experience Organizational Structure Questionnaire provides some other key questions for discussion, which can help you arrive at a more effective organizational structure. And understanding that organizational structure is an outcome of strategy, rather than the reverse; Logan suggests the following guidelines for organizational design:
- Begin with strategy.
- Involve the people who will do the work.
- Involve the customer in defining the desired experience.
- Analyze the kinds of decisions that will be made and who makes them.
- Remember that “other org charts won’t tell you anything” because effectiveness is dependent on factors unique to each organization.