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 customer experience function commonly reports to (figure 1, figure 2, figure 3):

  • The marketing department
  • A channel director
  • The chief customer officer or an equivalent

Figure 1: CX reports to the marketing function

When CX reports to Marketing, alignment with brand can be improved. However, the functional alignment and level of influence can create prioritization challenges and limit impact on the utility as a whole.
Customer Experience reports to the marketing function

Figure 2: CX reports to a channel director

When CX reports to a channel director, the influence of the function is equal to that of Marketing, Customer Care, and Research. However, CX can become lost in the vice president’s priorities, and it can become disconnected from the brand.
Customer Experience reports to a channel director

Figure 3: CX reports to a chief customer officer (or equivalent)

When CX reports to a chief customer officer (CCO), the vision has a better chance of being disseminated successfully across the organization. This can be especially effective when Marketing, Customer Care, and Brand also report to the CCO. Creating an organizational structure like this, however, can take a great deal of time and effort, and it can cause a great deal of temporary disruption.
Customer Experience 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).

Figure 4: Sample customer experience organizational structures

AGL Resources, Commonwealth Edison, and Duke Energy shared their customer experience organizational characteristics.
Sample customer experience organizational structures

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

Figure 5 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: The CX council cast of characters

A successful customer experience council needs executive sponsorship and cross-functional representation.

Organizational design

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. 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.

Contributing Authors

Senior Solution Director, Customer Experience

Eryc Eyl is committed to improving the experience of work and business for employees and customers. His expertise in customer experience, employee...