Self-funding business transformation around the customer

by Tim Rayner

Organisational transformation is rarely a cheap process, but overall costs can be lowered if funds are made available through resource reallocation from within the organisational function, or business units that are being impacted. Enterprises that demonstrate strong discipline in reallocating resources by better aligning skills and experience to higher value clients or higher potential opportunities, can achieve significant savings. These savings can then be redirected to new channels or client focused technology – making the transformation self-funding, to a point. Here we share our best practice tips to achieve this self-funding.

We've identified 5 key steps that leading organisations can take to reorganise around the changing customer and meet elevated customer expectations. We previously covered the first 4 steps:

1. Developing opportunity-based segmentation
2. Customising offerings to segment value
3. Prioritising channels based on value
4. Aligning CX, content & campaigns to customer journey

The final step involves self-funding the transition through resource alignment.

Freeing up capital

Maximising the use of cost-effective digital and ‘inside’ channels to reduce overall channel costs are good ways to access capital required for the transformation. As the organisation starts to engage more customers more effectively and cost-efficiently, it can then broaden its scope to engage customers and prospects on journeys that were not previously a priority, opening up further revenue opportunities. 
Best practice tips for self-funding the transition through resource alignment

Through our extensive transformation work with clients, we have identified the following 3 steps leading enterprises take to succeed in this area:
1. Bring forward cost-out benefits

To gain employee buy-in for transformation programs, we recommend sequencing change ‘packages’ – where high-value packages are frontloaded to make change easier, and realise benefits earlier. By identifying which of these packages of work will release value earlier (either through process improvement or partial technology implementation), organisations can bring forward cost-out benefits and then apply those perks to self-fund the latter parts of the transformation program.
After executing the highest value packages as part of the transformation, and then realising initial benefits, organisations need to ensure they follow through with subsequent change packages. It is important to stay committed to the full project, ensuring the project’s business principles continue to be adhered to, in order to maximise benefits and deliver on objectives of reorganising around the customer.
2. Refine the operating model to do more with less

Having the right marketing, sales and service operating model in place enables the organisation to
reduce the cost of sale and cost to serve, without diminishing effectiveness or the customer experience. Start by providing more clarity on the roles and responsibilities throughout the customer journey and align goals, targets and incentives to ensure a united workforce driving in the same direction.
Optimise the mix of specialist vs generalist and face-to-face vs inside sales roles to facilitate effective and efficient customer interactions. Also ensure teams are equipped with the capabilities to adapt and thrive in the new digitally-driven buying environment. Finally, look for tools that can reduce admin burden and boost the efficiency of teams.

3. Centralise capabilities & resources around the customer

A centralised ‘support infrastructure’ enables the organisation to build capability and organise resources across the customer base – at scale – providing cost savings. All sales teams can benefit from specialist expertise, improved coordination and standardised best practice and ways of working such as improved workflow management, knowledge sharing and effort prioritisation. Centralisation can also create efficiencies due to shared overheads and reduced layers of management. It is important, however, to identify the functions that can be centralised and those that need to focus on specific customer segments. Consider if there are truly unique needs that a customer segment has, and if centralised, whether that would divert focus from other segments that require that support.

Worded by Tim Rayner.

Find out more about how to reorganise around the changing customers