In 2007 we saw organizations rally around Customer Experience practices. Many companies across a wide range of industries – insurance, banking, telecom to name a few -- now have Customer Experience Management (CEM) ambitions, departments, and directors. Much effort, both by organizations and CEM vendors, was understandably focused on delivering a good customer experience. In 2008, we expect this to continue in full force, accelerated by the early successes of the past year. However, we will also witness the introduction of technology that enables companies to plan and simulate the customer experience.

Unlike CRM -- that focuses on the operational aspects of the customer relationship – CEM emphasizes predictive decisioning – or in simpler terms, all the stuff you need to know to anticipate customers’ needs, interests, and likely behaviors. It is just this predictive capability that will allow organizations to first design the customer experience strategies they want to implement at a corporate level, then simulate the effects on customers and the bottom line using ‘what-if’ scenarios. As a very notable side-effect, this will cause a trend (that is already emerging) to centralize decisioning to the point where there is a single “customer decision authority” that consolidates all interaction logic buried in disparate systems and drives all customer-facing channels.

By centralizing decisioning and implementing a customer experience decision hub, organizations can take direct control of the customer experience. In 2008, those organizations bold enough to be early adopters of sophisticated customer experience solutions will be able to change gears on the fly, essentially managing all the conversations that are going on in all the channels. This isn’t far-fetched. There are advanced prototypes available that implement this functionality and more, allowing marketing executives to steer customer experiences like a “fly by wire” airplane.

For example, by reallocating budget to customer retention, organizations can automatically impact propositions that are offered to customers at risk of churning, across all channels. Boosting sales, increasing customer satisfaction, or reducing risk will be done by operating the controls (after carefully studying the dials). By the end of 2008 this will be reality. The next year will see this type of solution evolving from “fly by wire” to auto-pilot, but that’s for 2009......