The benefits of a customer-centric strategy aren’t limited to private-sector businesses. Agencies at every level can realize their goals by putting the needs and wants of citizens first.
Tony D’Emidio is a partner in McKinsey’s Washington, D.C., office; and David Malfara is a specialist in the Miami office.
Savvy executives across business are coming to realize that no matter which products and services their companies offer, they are in the customer-experience business. Thanks to technology, consumers find it increasingly easy to buy what they need and want in any way they choose. Leading customer-friendly companies, such as Amazon and Apple, steadily raise expectations of superior service. Our research shows when companies systematically put the customer first, they create inroads against competitors, build cultures that benefit employees as well as customers, and improve the bottom line on both the revenue and cost sides.
The customer-experience phenomenon may seem far removed from the work of federal, state and local governments, but in reality, it offers important lessons. True, agencies rarely have a direct competitor from which they try to capture market share. Nor do disruptive start-ups typically emerge to steal their customers.
Yet, the rationale for agencies to improve the citizen experience may be just as powerful. Efforts to do so can provide public agencies with valuable opportunities to achieve their stated missions, meet or even exceed their financial or budget goals, engage employees in a culture of superior citizen service, and improve overall trust in government.
U.S. government agencies have vital missions, but to execute them successfully, they must win the consistent engagement of the citizens they exist to serve. The Education Department's Federal Student Aid program, for example, can’t help the neediest students if they aren’t aware of the services available or find the paperwork too complex or time consuming. Our research has shown a positive experience can promote the kind of engagement agencies need to be successful.
For example, in the December results of our 2016 Journey Pulse Survey, we found citizens who were satisfied with the State Department’s passport-application process were 33 percent more likely to renew. This makes intuitive sense: a good experience makes citizens more willing to engage consistently with the organizations that provide it, and that makes agencies better able to achieve mission-critical results.
Citizen-experience programs can also have a concrete impact on budget goals. For agencies like the National Park Service or the Export-Import Bank that have revenue responsibilities, a focus on improving the citizen experience can create opportunities to sell additional services or reduce churn.
Survey respondents who were satisfied with the service of the U.S. Postal Service, for example, engaged it for their shipping needs 67 percent more often than those who were not satisfied. Across private industry, successful projects for optimizing the customer experience typically increase revenues by 5 to 10 percent.
Efforts to improve the citizen experience need not come at a heavy cost to operating expenditures, nor do they necessarily involve large capital investments. When experience-improvement programs are executed systematically, they reduce costs or at worst are cost neutral. (Across private industry, successful projects to optimize the customer experience typically reduce costs by 15 to 25 percent within just two or three years.) An effective program can identify the experiences that matter most and focus investment on improving them while demoting, automating or eliminating operations citizen users don’t value.
The Office of Personnel Management’s 2016 Federal Employee Viewpoint Survey found for government employees, levels of satisfaction and engagement have been stagnant since 2012. Like most private-sector companies, many government agencies struggle to maintain an engaged workforce.
A focus on the citizen experience can help to reverse slumping employee-engagement numbers because superior employee engagement and a superior citizen experience reinforce each other. Through our work in the private sector, we’ve found programs to improve the engagement of frontline workers can have a significant positive impact on the customer experience.
We’ve also found the reverse to be true: a focus on the customer experience has an equally important impact on employee engagement and satisfaction. A well-run citizen-experience program can give the staff a common, unifying and customer-centered purpose while reducing complexity and unnecessary work in frontline processes.
A call center, for example, may identify how to segment its call volumes in a way that reduces the number of responses needed for low-value requests or automates those responses so employees can spend more time helping callers and finding more satisfaction in their daily work.
Finally, a better citizen experience can also increase civic engagement through an improved sense of trust in government. Our research shows federal agencies with a higher rate of customer satisfaction are considered more trustworthy by those surveyed. In fact, citizens who are more satisfied with government overall are seven times more likely to trust it will do what’s right.
In building a more citizen-centric culture, government agencies have much ground to make up. Our research shows federal agencies ranked last in customer satisfaction among 11 industries studied. Lessons learned from outstanding organizations in both the public and private sectors can define a clear process for improving the citizen experience while achieving success in the form of missions, financial performance (revenues and costs), the employee experience, and societal goals.
In our next installment of this three-part series, we’ll bring some of those lessons to the forefront. Our focus will be on defining what matters to citizens and providing insights into the drivers of satisfaction that can serve as the core of successful programs to transform the citizen experience.