Effective CX teams are invaluable to brand success — providing unique insights into customer thinking and behavior. Unfortunately, that strategic value can often be underestimated by senior leadership who see CX as just a cost center — providing added value to customers, but vulnerable to cutbacks when the business needs to make savings.
A major challenge for CX leaders, therefore, is making a convincing, evidence-based business case to get buy-in from executives on new CX initiatives.
To do so, you need to be able to clearly demonstrate the impact that CX operations have — and the value they add, quantify the ROI of further investment, align CX goals with wider organizational objectives, and be prepared to address the concerns or objections that may arise.
In this article, we’re going to walk you through that process from start to finish, offering actionable advice at each stage.
Defining the Problem and Opportunity
The first step in building your business case is clarifying the problem and identifying the opportunity that it creates — before proposing a solution. For CX initiatives, this can be broken down into a four-stage process.
Identifying key CX pain points and areas for improvement
To identify areas for improvement, you’ll need to make a comprehensive evaluation of where the key issues are and where CX operations could be improved. This involves reviewing key metrics such as customer satisfaction scores, response times, or total tickets handled per agent, and identifying where there are inconsistencies that might indicate an underlying problem.
In order to gain a deeper understanding of the root causes affecting CX performance, you also need to understand the different types of customer interaction that are taking place, in order to analyze which require the most resources, create the highest overheads, or introduce the most process inefficiencies.
This means manually reviewing customer conversations and tickets, and tagging and categorizing them into addressable buckets. Once you’ve done so it will be easier to pinpoint which issues have the greatest impact on performance and prioritize solving them.
Identifying initiatives that will address CX issues
Once you have a clear picture of the areas for improvement, you can begin to identify possible solutions. For example, instances of unnecessary duplication of work could be eliminated by optimizing processes, or inefficient workflows could be automated to make them faster.
In some cases, solutions may not require additional investment — you may be able to deflect or resolve minor issues by reconfiguring processes or restructuring your team. But for more transformational changes, such as introducing new tools or technologies to address CX pain points, you’ll need to include the associated costs in your business case.
Demonstrating the wider potential impact
To secure investment in the technology, tools, or process improvements you have identified as a solution, you need to demonstrate how your initiative will add value — not only within your department but across the wider organization. To get senior leadership on your side, what’s important is to clearly show the expected ROI and the impact your initiative will have on company-wide objectives.
Quantifying the ROI of CX Investments
Once you have a plan in place for what you want to achieve, you need to demonstrate its benefit to the business by quantifying the expected return on investment that your changes will deliver. Here’s how.
Collecting data to support the business case
Using the data you gathered to assess the impact of your new initiative, you can illustrate the immediate financial benefits — for example, showing that if you can invest in automation to deflect 50% of inbound tickets, you can reduce spending on agent salaries by $10,000 per month.
However, cost optimization doesn’t necessarily make a convincing case for investment on its own — you need to show the broader impact on company-wide objectives such as increased revenue, risk reduction, or profitability gains.
Calculating the potential return on investment (ROI)
To develop a more complete picture of the expected benefits to the business as a whole, you should include a detailed analysis of the quantitative impact on the business as a whole — going beyond simple cost savings within CX to show how your initiative impacts other departmental goals.
For example, if you’re making the case that automating a certain type of customer interaction reduces average first response times, you need to also show how that will affect customer satisfaction, for example, increased CSAT scores, and then link that to a company objective, such as an increase in revenue generated from those customers.
Once you can do this, you can attach a dollar figure to the outcome of implementing the initiative, giving leaders a clear picture of the expected ROI.
Calculating the cost of inactivity or delay
Having prepared a detailed breakdown of the ROI your initiative will deliver, you should also be able to quantify the opportunity cost if the change doesn’t go ahead, or is delayed. This may be relatively simple — for example, delaying the initiative by 6 months will mean missing out on monthly cost savings in the short term, or more complex — for example, creating a risk of increased customer churn during a traditionally profitable quarter, impacting longer-term revenue.
Aligning CX Initiatives with Business Objectives
To ensure buy-in from leadership, it’s vital that your business case demonstrates the specific impact that your proposed initiative will have on the overall strategic goals of the business. By developing your ROI prediction to include impact beyond the CX team itself — contributing to wider company objectives — you can now show a clear link between CX initiatives and top-level business goals.
Once you’re able to prove this direct impact, you can align proposed initiatives with specific departmental goals, which adds strength and support to your business case — for example showing how introducing a new software solution to automate a certain type of ticket resolution will directly contribute to the sales team achieving a quarterly revenue target.
Addressing Concerns and Objections
Before meeting with senior leadership to present your business case, there are a few additional preparations you should make to ensure that
You should expect detailed questions about the costs involved in implementing your proposed initiative — and detailed proof of the ROI you’re predicting. You need to ensure that you make the full data you used to build your ROI model available and that it is presented in an easily digestible format that the executives you’re approaching for investment can understand at a glance, while also providing the granular detail they will require to answer specific queries.
While this will help assuage any concerns from leadership about the profitability of your initiative, and its impact on wider business goals, there may be objections to implementing your changes in the short term — for example, if executives feel there are other internal investments that should be prioritized.
So, it’s also important to include data points that demonstrate the urgency of the initiative, incorporating an analysis that clearly shows the impact of delaying the change or failing to act altogether.
If possible, you should aim to review the data you intend to present with a member of the senior leadership team, for example, the CFO, to ensure that you’ve covered all the bases — and that the format, depth, and detail of your presentation offer sufficient information for leadership to make an informed decision.
Conclusion
For any new CX initiative, it’s crucial that you’re able to present a solid business case that makes a compelling argument to senior leadership, convincing them of the need for investment by demonstrating the tangible benefits it will deliver, in line with the organization’s strategic objectives.
Getting executives onside is crucial — without support from senior leadership it’s impossible to make meaningful changes or to sustain those changes over time.
The key point to remember is that this is a collaborative process, not an oppositional one. The better your relationship with the leadership team becomes, and the more clearly you’re able to demonstrate the ROI associated with investing in CX, the easier it will be to sustain executive buy-in and secure investment in your department in the future.
