The Hard Truth About CX and What Comes Next with Zack Hamilton

Speaker A: Welcome, um, to the Business Transformation Pitch. I am Greg the CX Goalkeeper, bringing you conversations where transformation, leadership and customer experience meet to create real impact. Did you know 80% of regular listeners haven't subscribed yet? If you enjoy the show, support us by hitting the subscribe button. I promise we will keep raising the bar with the guests ideas and strategies that really matter to you. Because in business, just like in football, this conversation could be the game changer.

Speaker B: I am Greg's AI based assistant. In this episode, Greg had a great conversation with Zach Hamilton about the future of customer experience and the hard truths that many leaders might not want to hear. They discussed about the limitations of traditional experience management and the evolution toward what Zach calls experience performance. Zach shared his journey of disrupting long standing business practices and how, uh, digital payments have transformed industries. Enjoy the episode. The Swiss Future Institute and the AI Future Council connect you with Switzerland's leading experts in AI, digital transformation and leadership. Explore the network at the SwissFutureInstitute. CH Opportunities don't happen. We create them. Ladies and gentlemen, welcome to the Business Transformation Pitch with the CX Goalkeeper. I'm super thrilled because today I have Zach Hamilton together with me. Isaac.

Speaker A: How are you?

Speaker C: Hey, uh, what's up, Greg? Great to be here.

Speaker B: Thank you very much. I am really thrilled to have this discussion because we are discussing about the hard truth about CX and what comes next. But basically Zach had a very interesting podcast and therefore I'm really looking forward to have this chat. Uh, but as usual, before we deep dive into the topic, uh, Zach, uh, what's your biggest career goal so far?

Speaker C: Yeah, that's a. Oh, that's a really good question. I've been thinking about this one. For me, um, believe it or not, I've never really set some of these big hairy goals that I want to go out, um, and to achieve. For me it's always been about, I've always chased the ability to fundamentally disrupt and change how businesses think. Um, so for me, when I think about brands, uh, that I've worked for, uh, it's always been, hey, I like to work for brands that are 30, 40, 50 years old, um, because I like to fundamentally change the way that they work. Like at ah, Aaron's for example, which was traditional rent to own. And if you're outside the country, um, for 50 years it was very much a cash business where they make a, a weekly or monthly payment in cash. Uh, and for me it was kind of the rise of digital payments. And everyone said, um, our customers, they just don't have a debit card or a credit card. They're underbanked and so it'll never work. Um, but we launched digital payments, Greg, anyways, uh, because we found out that's what our customers wanted actually. And now if you listen to their earnings calls for them, digital payments is about 85% of their business. Um, so for me it's just all about can I disrupt and fundamentally change the way that the businesses think, um, or even now industries. So I've kind of uh, I guess if anything for a big goal it's changing the way that the CX industry thinks globally.

Speaker B: Thank you very much. I think you're already touching the second topic. But to mention that digital payments, it was my topic. I work for financial services in the credit card uh, business and therefore thank you for the great preparation that you linked your stories also to what I did in the past. What's your mission now?

Speaker C: Yeah, so the mission now is, and I think if you've seen me on LinkedIn or other podcasts, um, to me I really believe, um, traditional experience management has uh, hit its ceiling. I think for 20 years it served its purpose, um, and it's taught every organization how to listen to customers. Uh, and now I believe it's hit its ceiling. And I think about the evolution of cx and I know we'll talk a little bit more about it later so I won't go too deep into it. Um, but for me it's all about as we think about moving to agentic and adaptive. Um, right now the industry needs to really evolve into um, experience performance. Um, and so it's all about how do we perform for the business, um, not just listen to our customers. And so you know, if you really think about that, it's, it's a, it's a massive shift, right, because SaaS companies have, I mean if you think about the industry have built billion dollar companies around helping us listen better to our customers, right? When we think about customer experience, ask us how, how do our customers feel about the brand? Um, and really experience performance is all about, um, how does experience create better business outcomes both for the brand and the customer? And it might sound subtle, but it's actually a completely different discipline. And so we're building systems that connect friction directly to operational decisions and financial outcomes, employee performance. And now as we start to get more and more into AI, um, and it's less about listening and more about acting and performing.

Speaker B: Uh, that's really great mission, but I need to correct one thing that you said. I'm not seeing your post in LinkedIn. I am a big fan of your post in LinkedIn. It means you are, uh, a superstar in LinkedIn and everybody should follow you for the audience. You will find all the links in the show notes. Please follow Zach on LinkedIn because Ace sharing will be great insights. And not only follow only the his LinkedIn profile, but also the podcast. Could you please share a bit about your podcast?

Speaker C: Yeah, absolutely, Gray. I appreciate that. So here's kind of the genesis of the podcast. So, uh, my podcast is named Unfucking your cx. Um, I know it's, it's pretty provocative. Um, I was very intentional when I selected that. Um, but the genesis for that, Greg, was, um, about 18 months ago, I was flying home from a client visit in Germany. And it was kind of in this moment where I just asked myself, am I still really passionate about customer experience? Is this something that I really want to continue to invest, evolving myself, um, in the field, in the principle and the discipline from a leadership perspective? Or have I served my time? And it was time for me to move on to something else. And so in that moment, I just pulled out a sheet of paper, um, because I felt pretty burnt out when it came to the discipline. And I just wrote down everything that I hated about it. So it was like all these things that were making me cringe, um, about the discipline. And a couple weeks later, as I was cleaning up my backpack, because I was flying in and out, um, this popped out of my notebook and I was reading it again. I was like, okay, what am I supposed to do with this? So ultimately I just picked one piece, which the first one was all about the worshiping of vanity metrics, right? NPS, CSAT, whatever. And I just wrote the Unfucking your CX newsletter on LinkedIn. That was my first, um, topic. I didn't really expect for it for anyone to read it. It was really more just kind of writing for my own, my own soul and trying to find my purpose. And, um, can I rediscover the passion that I had? Um, and all of a sudden, Greg, that first, um, newsletter, I don't want to say it went viral, um, because it didn't get like a hundred thousand engagements. But for me, in that moment when I was posting, um, it got over 40,000 engagements within a matter of like three or four days. And that's when I was like, okay, something sparked here. So I just kept writing once a week and then it picked up to two times a week. And I started to get all these messages about you're saying the things out loud that we all know we just haven't had the courage. And then, um, I got a direct message from Beth Carawan, who was like, look, if you ever host a podcast, I want to be a guest. And I wasn't thinking about a podcast still at that time. It was just about. I was writing to find myself in this place. And then a couple weeks later, I was like, screw it, let's start a podcast. Uh, and then it just kind of. It's blown up from there.

Speaker B: And I'm, uh, super happy that you started because it's really a good podcast or, sorry, not a good, great podcast. And for the audience. You will find all this information also in the show notes. But now let's kick off the game and let's speak about cx. As you said, there are some things that we should discuss about, but we don't really discuss about. What is the hard truth about customer experience that most leaders do not want to hear?

Speaker C: Yeah, I don't know if it's as much as this is an unpopular opinion that we don't want to hear. I think we all know it. Um, and that is, I think, because traditional experience management has hit its ceiling, right? It has. When I think about we're moving in this era of kind of failure, failure is different than the, Than the practice is dying, Right. What I mean by failure is, um, we see practitioners losing their jobs every day, right? They're losing their jobs, they're being riffed down the business. Um, the budgets are getting cut, um, by 60, 70, 80%. Um, CX leaders really have no influence in the business. And so for me, if we were to take a step out of CX and we were to look at any other practice, we would all say that system is failing. There's all these red signs about it's failing. And so I am one of those who truly believe it is now failing. And it's not because CX practitioners don't care, Right? We, a lot of us care. There's so many people that care, and they're trying to resuscitate it. You know, they're trying to fit traditional, um, experience management into a business model that has significantly evolved. And we keep trying to resuscitate it instead of evolving. And I think part of this, Greg, is, you know, it's failing, I said it earlier, is we've built this industry that's incredibly good at generating insights. And if we think about it, insights are significantly cheap now. Right. Leverage any AI model. Insights are extremely Cheap. And we've also become incredibly poor at generating organizational decisions. And so if you think about it, we don't have an insight shortage, we have a decision shortage. And because we have a decision shortage, there's very little action that gets taken in the business. Now some people can argue and say, well we're closing, you know, we're closing the inner loop. Great, you're following up with customers, that's awesome. But what are you doing about changing that experience that you continuously are closing the loop on? And so to me that's where this, where we have lost our level of influence in the organization. Because if you look at, if you sit down with the CX leader and you ask them what's your goals for this year? Show me your roadmap you typically get. I want to increase a vanity metric. So I want to increase our company wide NPS and we have all these outputs. So I'm going to rebuild this survey that has a low response rate. I'm going to create um, new dashboards. I'm going to go on another roadshow and show all of my cross functional stakeholders how to leverage my voc, our VOC tool. But then again, yes, everything gets distributed but nothing changes operationally. I think the other piece is we overanalyze everything. We have so many analysis models. And so the problem again it's not measurement. It all comes down to we're not driving execution in the business and it's not our responsibility as CEX leaders to drive execution in the business. It's we have to win through influence. And that's one of the things that I learned very early on in my career. Aaron's was I didn't own the budget or the resources, my cross functional partners did. So I had to one influence them by really understanding how they measure the success of their business. Right. What's their strategic initiatives, what's the KPIs that if they don't achieve they can get fired for and then how do I influence those? So um, how do I find customer friction that's blocking that KPI that if they just prioritized it would accelerate them to achieve their KPI or unlock it. Um, and that's what I learned how to do really really really well um, is when do influence co create business cases. In a matter of fact Greg, over the last two years I just posted this today, um, I've been coaching um leaders on how to create a one page business case. Part of it's in the book. Then I run cohorts around it and what I have them do is they can submit their business case and they basically get a strength score on it. And part of that is also um, how many champions, customer champions or stakeholders did you create this with? And what's really fascinating is at the beginning when I first started running this, it was always CX was going at this alone, right? So um, the CX leaders were basically not evolving. If they got invited to a prioritization session, they were going at it alone. And out of over 140,000 business cases submitted the last two years, only 12% got approved if the CX leader went alone. But if they had four customer champions. So think about digital leader, operations, finance, um, and, and of course CX would be the fourth all champion IT 69% of business cases got approved. And so to me that tells me we can influence the business. We have to develop the skills on how to do it.

Speaker B: These are really great words and I think that's exactly what we are seeing. You mentioned that at the beginning a lot of colleagues are losing their jobs because they cannot really show and prove their impacts. And as you mentioned it's so important to have an impact at the end. We know that customer experience is a growth strategy. It can help keep customers, it can help increasing the share of wallet, it can help uh, not lose clients retention and, and, and but basically that's so important to create these alliances and work together with the business to create real business value. I really like how we started. And now you're speaking about leapfrogging from the old fashioned way of doing analysis and creating the next dashboard to getting to CX 5.0. What must company change to avoid being left behind?

Speaker C: Yeah, well I think, I think companies, it's really interesting. Let me just kind of explain how I see the evolution of, of cx, um, and explain this because maybe not everyone understands it. So when I think about kind of evolution, um, of course everyone is talking about AI, right? So AI everything. Some folks, some brands are already starting to generate um, Agentix CX. For me when I think about customer experience 1.0, um, that was the customer service area or era, right? So that's reactive enterprise. Um, and really the core question was um, did we resolve the issue? So customers experienced a breakdown, they called in um, in order to get support, um, and the goal was did we basically recover the relationship? Do we deliver the right level of support, um, and do they still feel good about our brand? Right. So this is very, very reactive. This is all about resolving issues and um, recovering customers. Then 2.0 came in, which is experience, you know, traditional experience management. Um, and this is all about kind of that measured enterprise. And so experience has been treated as measurement, listening, insight management, democratization of insights to dashboards. And the core question's really been what are our customers saying about our brand? Um, and the goal is how do we generate referrals? Right. Especially with the NPS question. And so the primary role of CX has been voice of customer and insight management. When I think about 3.0, which is where we must evolve to, and the reason why we must evolve to this as an industry is because our businesses are demanding it, the markets are demanding it, and quite frankly customers are demanding it. And so this is all about kind of that operationalized enterprise. Um, and this is really about what is hurting, you know, what frictions are our customers experiencing, how is it hurting them and how is it hurting business performance? And so I think the reason why we got here, Greg, is if you think about digital transformation, every brand wanted to be the first to the market with a, uh, mobile app and digital website and all these things. And in order for us to do that, there was always trade offs that brands had to make. So if we wanted to be first to market, we won't be able to connect all of our, um, databases internally. That's a trade off we're going to have to make. Um, which means we're going to have technological debt, we're going to have to come back to it. Right? I mean, I've sat in so many meetings where our CIO is like, hey, we can do this, but there's trade offs and trade offs mean nothing's going to be connected. And our CEOs are like, yep, let's do it. We want to be first to market. That'll help us gain market share. Well, what ended up happening was it wasn't that just the databases were disconnected, policies were disconnected, operations were disconnected, everything was disconnected because there were so many different systems that helped parts of our customer that in between all those disconnections is where customers were experiencing friction. And so now I think about this as CX debt. We have experience debt living inside of our organizations, which is really driving customer churn and customer exploration. And so for me this is about one how do we connect all the systems internally to really understand the intelligence of our customers, what friction is hurting performance? Um, and how do we go resolve that specific friction? Uh, and the reason why it's so important is this is really about kind of closing that outer loop. But it's not kind of in that waterfall approach that was, you know, the MPS system 20 years ago. This is really about systematically doing it across, um, many stakeholders in the organization. And the reason why it's so important is if you think about the 4SO 4.0, which is a Gentix CX, this is all about designing agents. So this is literally experience design. And so if you can't design and remove friction from a human LED perspective, how are you going to design an agent to do it? And everyone says, well, there's always going to be a human in the loop. Um, and to me we already have human in the loop. That's called governance medians. That's like all those things. So to me, Agentix CX is really the codification of human performance in 3.0. So as you basically identify friction, you redesign the experience policy, whatever it may be, you deploy it, you understand that it impacts consumer behavior positively, you codify that into a playbook and now you design the agent. So that's 4.0, 5.0 is the adaptive organization, um, or you might hear it called autonomous cx, where agents now really start to sense, okay, I didn't make the right decision, let me basically learn from that. And they're just going to adapt and evolve to what those right decisions are. And so the biggest step that or the, the biggest issue I'm seeing right now is brands think they can go from traditional experience management to agentic CX and have never successfully executed the outer loop. And that's where design and redesign principles all come about. Right? Because most of us at CX leaders, we didn't design the initial experiences. We're new to organizations that have been around for 10, 15, 20 years. All those experiences were already designed. We're inheriting them if we don't know how to redesign them. And yes, we can redesign them on paper, but if we can't execute them effectively as an organization, that's not true redesign.

Speaker B: That, uh, that was so interesting. It was something like a masterclass over the transformation or the possible transformation of cx. And you mentioned one very relevant topic now it's AI. It's everywhere. How will AI transform customer experience over the next few years?

Speaker C: Yeah, so I think it'll be gradual. Um, you know, we're already seeing it where, you know, agents are being leveraged in, in our call centers and our contact centers. M and ultimately I think there's different version of those agents where the first agents really are, are being built, Greg, on, you know, SOPS documentation, like those types of things, uh, which is great, but you're honestly just creating a more intelligent chatbot, if you really think about it, um, the way that I think about agentic and I'm a, I'm a huge proponent of it. Um, now do I think that the humans will never be in the loop? Not at all. I think the humans will sit above the loop. I think agents, um, what I'm excited about for, for Agentic CX is will they will truly be able to deliver the experiences that we've been talking about for 10 years. True personalization, true in the moment orchestration, true in the moment activation. And you might be wondering, well, why haven't we been able to do that today? Well, because as humans, we don't move quick enough. We don't make decisions fast enough. And so anything about agents, the agents are making the decisions, not us.

Speaker A: Right?

Speaker C: They're making decisions based on what we design them to do. Um, and so they will really be able to act in the moment. I mean, I know there's a lot of technology companies out there who say we enable you to act in the moment. Bullshit, right? Like it's, it's great language, but tell me, what organization truly has a human acting the moment outside of a call center? Who's reacting? They're not proactively, they're reacting. And so to me, I think agentic, um, is really, I think the brands who win, let me put this way, the brands who win will go through the evolution curve, um, and they'll really, truly take experience, performance, um, seriously and, and leverage all the human learnings and codify it. I think the brands who skip and go from two to four because the technology promises that they can do it, it's going to be digital transformation all over again for them. And I think the other piece, Craig, that we're seeing now is, um, because CEOs are saying we want AI everywhere basically in our organization because of the promise of, um, operational efficiencies. Now every department has Agentix somewhere. So it's like VOC 2.0 where everyone kind of had their own little listening platform. Well, now everyone's getting their own kind of AI or agentic platform and none of them are going to be integrated. So you're gonna have all these agents who are gonna be making decisions about your business that aren't integrated into a single point of view until you have to manage the performance. And so I even think about the evolution of agentic, of our roles as CX leaders now kind of evolve and morph into um, agentic operations where we're going to be managing teams of agents. And what will happen is when a decision is not codified into the design of an agent, it will kind of flag it as a one off. We basically take it through the redesign process and then recodify that back into, um, decision learning for an agent.

Speaker B: Zach, thank you very much. I would have hundreds of additional questions to you, but taking care of your time and for the audience, we are coming to an end of this discussion. But at least I have one question. One question for you. It's Zach, golden nugget. It's something that we discussed or something new to leave to the audience with.

Speaker C: Yeah, I think that's it. This is an interesting one. Um, I would say if I can leave a golden nugget to the audience, who's listening or who may be listening, um, is the companies that dominate the next decade are not going to be the ones with the best AI. They're not going to be the, the ones with the most data. They're going to be the ones that learn faster than everyone else. And that is experience is no longer something customers have. It's really about how organizations learn. And the companies that remove friction the fastest based on those learnings will outperform everyone else because they will be delivering the experiences customers want.

Speaker B: Zak, thank you very much for your time. Please stay with me. For the audience for today, it's everything. I think it will be sure that I will ask Zach, uh, to join again because it was so full of insights. These 30 minutes were really flying through the main topics. And let's really, the next time, deep dive into one topic. Zak, thank you very much for the audience for today, it's everything. Talk to you next week. Bye bye.

Speaker C: Cheers.

Speaker A: That's all for today. If you enjoyed this episode, please spread the word. It really helps. And remember, 80% of regular listeners haven't subscribed yet. If you enjoyed the show, the easiest way to support us is by hitting that subscribe button. I promise we will keep raising the bar with guests ideas and strategies that matter most to you. Until next time, never forget, we are not in B2B or B2C. We are in edge to edge, human to human environment. Thank you.