In order to sufficiently serve customers, government agencies must reconsider their focus on customer experience (CX). The COVID-19 pandemic has only emphasized agencies’ successes and shortcomings in this space. In this episode of McKinsey on Government, McKinsey partner Tony D’Emidio and associate partner Marcy Jacobs discuss how agencies have changed and how to think about CX and its benefits. An edited transcript of their conversation follows.
Francis Rose: Welcome to McKinsey on Government. Each episode examines one of the hardest problems facing government today and solutions from McKinsey experts and other leaders. I’m the host of McKinsey on Government, Francis Rose. The federal chief information officer, Clare Martorana, says customer experience should be seamless and secure for the citizens the government serves.
The Biden administration recently updated guidance from the Office of Management and Budget [OMB] to expand the scope of customer experience. CX is the subject of McKinsey on Government this week with Tony D’Emidio, partner in McKinsey’s Washington, DC, office, and Marcy Jacobs, associate partner in McKinsey’s Washington, DC, office.
Then and now: Pandemic-framed measurements of success
Folks, welcome. Thanks very much for joining me. Tony, I want to start with you. The work that you’ve done in this area in customer experience: How has that trajectory changed over the past 12 to 18 months as organizations have had to respond to the way that they deliver services to people in light of the pandemic?
Tony D’Emidio: Great question. From what I’ve seen, it’s put government even more on notice. So when you see through the pandemic, this is a time when citizens have had to rely on government services as much as any other time, maybe perhaps in their lifetimes.
It’s a lifeline for unemployment benefits. It’s a lifeline for healthcare benefits and healthcare assistance. What I have seen over this time is a real gap between agencies that were ready and prepared and had the processes in place to be able to assist and help citizens in a great time of need, and agencies that were caught flat-footed, saying, “My gosh. I don’t have a way to operate when all of my employees are scattered.”
“When I rely on paper-based applications, when I rely on receiving checks in the mail, I have nobody to go and receive them and collect them.” It’s a wide gulf. But I think also what we’ve seen over the past 18 months is a crisis can be a really powerful motivator for change.
Even those agencies that were caught flat-footed: what I’ve seen is a number of them were able to use this moment as a chance to make change and say, “No, we need to be able to adapt now, change the way that we work, and not let perfect be the enemy of the good in terms of information we would have collected.”
And they certainly propelled themselves in terms of investments and technology and allowing employees to work from anywhere. It’s a really interesting dynamic that we’ve seen over the course of the past 18 months, one that hasn’t lowered the need for customer experience but has helped a lot of folks raise their game.
Francis Rose: Marcy, welcome. It’s good to see you again. Thanks for joining the discussion today. What do you think the organizations—that have had the success that Tony detailed—did before the pandemic? Obviously not prepping for the pandemic, but what did they have in place, or what were they working on that allowed the successful ones to be successful? And the organizations that weren’t as successful, what were they lacking? Are they the same things, or are there different pieces depending on different situations?
Marcy Jacobs: I think that there’s a few pieces to that, and it’s great to see you again as well. I think that there are organizations that really embraced the digital mindset and digital transformation. They may have been on a journey to modernize technology systems.
They may have started hiring digital talent or thinking about products and design in a different way. And I think that there are agencies and organizations that have really figured out how to listen, which I think helps them be more agile and more responsive to what is going on.
And we have now been in this 18-month unplanned experiment where there’s been a lot of need to listen, to pivot, and to react. And the companies that have the talent and the ability to really hear what’s happening has positioned them in a fundamentally different way, whether it’s technology, or process, or policy even, to be able to react to the situation much more quickly than companies that are thinking in a much more traditional way.
Information gathering and improving customer experience
Francis Rose: The organizations that are listening well, what are they listening for? And what are they doing with the information that they gather from that listening, Marcy?
Marcy Jacobs: There are so many sources of data, and I think it’s becoming more common for agencies to know what to do with them. But it’s listening to call centers. It’s listening to social media. It’s seeing what’s happening on the website.
It’s talking to people. It’s doing the user research to understand: Where are the friction points? What is working well? How do we think about changes to address a problem in the smallest, fastest way possible instead of maybe the more traditional, more comprehensive, longer way that I think typically agencies are kind of admiring a problem for a very long time?
And thinking about how do we solve this, every single edge case? As opposed to what is a thing that we can do now to start addressing this pain point or this challenge, and learn from it, and be very iterative? And that’s just a big change that we’re seeing both at the state and the federal levels.
Retrospective thinking on how the government delivers to customers
Francis Rose: Tony, what are you seeing organizations do differently now regarding customer experience than they did five years ago in government? The reason that I ask that is because it has been a difficult lift to convince every agency, to convince every organization that customer experience is really that important.
Tony D’Emidio: I think you’ve seen the private sector, if you go back five to seven years, Francis—even more than that, ten years—raise the bar on customer experience. What that has created, it actually for a period widened the gap between people’s experience with government and people’s experience with their average private sector or company that they got a service from.
That raised the bar for government to have to catch up. Now, what we have seen in response to that is proactive, forward-thinking government leaders starting to really prioritize it.
We can get into some of the reasons why that might be, because there’s a lot of benefits to investing in customer experience, and we’ve seen that. But I also think you’ve started to see real change, and this is where the government started to use their bureaucracy to its advantage.
You see across the federal government—toward the end of the Obama administration, with the Core Federal Services Council and then continuing in the Trump administration with the Cross-Agency Priority Goals, and some of that work that was done at OMB—a much more systemic, government-wide emphasis on customer experience.
And then you have organizations that started to have awards around customer experience. And all of a sudden, I would say over the past five years, it’s gone from a topic that was very niche and very small to something that now lots of folks are at least talking about. And that’s really exciting.
You have organizations that started to have awards around customer experience. . . . It’s gone from a topic that was very niche and very small to something that lots of folks are at least talking about.Tony D’Emidio
Looking at customer experience and finding solutions
Francis Rose: Marcy, your former agency, the VA [Department of Veterans Affairs]: the most recent effort that they’ve undertaken is an internal customer-experience journey map. I thought that was interesting because it took agencies in government a long time to think about their internal customers as opposed to their external customers.
That conversation seems to be lagging even behind the broader CX conversation. How did you and your colleagues get that going at VA? That conversation about, “This is something important; this is something we should invest time, and resources, and people into,” how did that start at VA?
Marcy Jacobs: There’s amazing talent at VA looking at customer experience from a lot of different lenses. But I think the connection between the experience of employees and the service that they are able to deliver to their customers—whether those are internal customers, IT users who are being serviced by the Office of Information Technology, or veterans who are trying to get a benefit or service—if your employees are able to support that in a more effective way, if they feel that they are supported, their ability to deliver better service only increases.
I do think that typically we see agencies starting from the outside, thinking about, “What are we delivering to our customers externally?” But the more you can think about it in a holistic way, “We’ve now made this form easier to use, but what does the person receiving the form actually get? How do we make sure that they aren’t getting a 200-page PDF that they have to sift through?”
Because when you think about the end customer experience, they want to get a decision on an application quickly. And if the person who’s reviewing that application still has to sort through a ton of information to see the handful of points that they need to base that decision on, it’s going to take a long time. So, thinking about that very holistically, it’s not just about an easy-to-use form. It’s about everything that happens until you get that end result.
Francis Rose: How do you go about making sure that the solution is really the solution, Marcy, to what the customer is experiencing, and it enhances her experience rather than at least neutral or maybe making it worse?
Marcy Jacobs: You do that through talking to people. And some of this is, “Are we even solving the right problem?” Any agency may have a goal of, for example, decreasing the time it takes to process a claim. That’s a big goal and maybe a promise that’s made to a secretary or to Congress or at many levels.
But understanding and breaking that down by talking to all the different users who are touching that process is where you determine if you’re actually making things easier, faster, or if you’re making it potentially more complicated and overwhelming for the people who are involved in those different touch points.
Tony D’Emidio: Really knowing which of those drivers to focus on is essential. Measure twice, cut once. Look before you leap. We have these sayings.
We find time and time again: make it simple, not necessarily faster. That is generally the key. But you have to know your customer. That’s the key that Marcy said. But I have come across many agencies—one in particular—that found itself as front-page news in a way they didn’t want to be.
When we dissected and helped them look at, “OK, what was going on with the customer experience?” they had prioritized speed of a decision because that’s what they felt the customer wanted. And actually, that emphasis led to more errors in their processes, which led to a worse experience, more appeals: people appealing to their legislator and representative.
And when we helped them reengineer the process, we didn’t actually make it that much faster. We just made it simpler, more transparent, and easier for the customer to understand. That was the key to dramatically improving the customer experience. You really have to know what it is that the customer is looking for.
Marcy Jacobs: I completely agree with that, Tony. And I’m glad that you said “transparent,” because I would say in my 20 years of looking at public service, customer experience, transparency is a very common theme.
I hit “submit” on an application and now I have no idea. “Am I done? Am I going to get the thing that I’m trying to get? When am I going to get it? What is it going to look like? What other steps need to happen?” That transparency, even if it’s going to take a long time, it might take years for your application to be processed for certain agencies. Telling people what to expect and being transparent has an incredible impact on building trust, building respect—“We haven’t lost you”—and I think that’s a really important piece.
Core tenets of prioritizing healthy organization–customer relationships
Francis Rose: Marcy, you used two words there that I think we lose in the general dialogue about customer experience when we’re talking about logistical and tactical stuff. And those are “trust” and “confidence.” Those are the things that customer experience is really about at the core, aren’t they?
Marcy Jacobs: Absolutely. I think the research that we have done and the conversations that we’ve had with users underscores that trust. Feeling like, “I know what’s going to happen. I understand what you are doing. I trust the government is going to give me the benefit that I have earned,” is something that is intentional, that comes from actually designing an experience.
I think that there are a lot of agencies that have not thought about customer experience, have not invested in customer experience, but they still have a customer experience. Customers are still experiencing their agency. And it might be in a very fractured, disjointed way.
It’s a problem that a lot of organizations face because they are thinking about, “What do we need to do to run our business?” And they are not thinking about, “What does somebody interacting with our business experience?”
And if you think about something at a state level, the unemployment office may be very different from the reemployment office. Those are two ends of a journey. Someone who is engaging with unemployment logically also needs to engage with reemployment, reskilling, or workforce development. If those two groups are not working together, that customer is having a very stressful time in many situations, having to effectively start a new journey just because they have switched to a different department. And they don’t understand the org chart of the organization that they’re interacting with. Nor should they need to.
Five benefits of improved customer experience
Francis Rose: Tony, where everyone resides in an organization, how does one go about making the case where customer experience is not a priority that it should be a priority? And what are the best selling points to make the case that, “We might need to reprioritize our investments, but we really need to do this for these reasons”? What are those reasons, and how does one effectively make that case?
Tony D’Emidio: Yeah, it’s a great question. We typically see—if you think about a business case or a case for customer experience—in the private sector, it’s very easy. Why does Amazon invest in your customer experience? Because if they create a better experience and make it easier for you to buy from them, you’re going to buy more stuff, which goes right to the bottom line.
Or if your airline or hotel made it a smoother experience, you might tend to fly with them more, or you might tend to complain to them less. There’s a real business case for improving customer experience in the private sector. We found a lot of those same benefits translate over to government, but some of the rationale is different.
Trust is one of those we talked about. Satisfied customers are nine times more likely to trust their government or agency. So when you think about the business case in an agency or across government for a governor or a head of a department, building that level of trust is a huge benefit. That’s one benefit.
A second is linking to the mission of the organization. So many people at every level of government are there for the mission. They joined government because they wanted to make a difference. They believe in the mission, whether that’s serving a veteran, as Marcy said before, whether that’s making sure someone gets a benefit or a claim that they deserve—whatever it is.
We have found that with better experiences, satisfied customers are nine times more likely to agree that the agency achieves its mission. And a lot of times, this is one where seemingly conflicting priorities actually go together.
Security is one of my favorite to use. A lot of times people say, ”I can’t worry about how happy people are waiting in line at TSA [Transportation Security Administration] because I’m worried about security and making sure the bad guys don’t get through.” When you look at trusted traveler programs like TSA PreCheck or Global Entry, why do these places have these programs?
It’s because they can create a better experience for people so that they can focus their efforts on people who aren’t precleared; experience and the mission can actually go together. And that’s one of the great things that we see.
So trust is one. Experience is another. Budget and financial outcomes, just like in the private sector, is definitely a factor. We know this because people who are more satisfied contact the call center less. They use the website less. So it brings your costs down the more that you, as a government agency, have your customer experience in order.
Then there’s also a real factor in reducing risk. If I’m satisfied, am I more or less likely to reach out to my representative? Am I more or less likely to go on social media or go to the media and say, “I’m having an issue”? So there’s trust, there’s mission outcomes, there’s risk, there’s financial outcomes.
And finally, at any level of the organization, the fifth factor, Francis, is the employee experience. So many organizations can use a focus on a customer to boost the experience that employees are having in that organization. It’s a way of uniting and galvanizing a workforce and giving folks a reason to show up to work every day. Regardless of who you are or where you are in the organization, there are a ton of reasons to get excited about investing in a great experience for the customer.
Marcy Jacobs: I think that there are incredible efficiency gains when you are actually designing for the jobs that people are doing, as opposed to designing for a list of requirements. There are also a lot of retention benefits and discretionary effort benefits. When you have more satisfied employees, their serving of their customers improves dramatically.
There are incredible efficiency gains when you are actually designing for the jobs that people are doing, as opposed to designing for a list of requirements.Marcy Jacobs
Simplifying the brainstorm: Fewer complications, better solutions
Francis Rose: What are the common customer-experience execution principles, Marcy, from project to project or from journey to journey? And what should someone look out for as being customizable or being unique to different journeys when they’re trying to figure out how to modernize their systems?
Marcy Jacobs: I would say it always starts with listening, curiosity. It always starts with user research. I never want to go into a customer-experience effort thinking that this is a technology problem or that there is a definite technology answer. There was an example that I heard of recently where the challenge that they were facing was a lot of incomplete applications.
Applications were submitted, but the signature form wasn’t there. All of page two hadn’t been completed. And they saw this a majority of the time. When they did research with users, they were seeing that people just weren’t seeing page two.
This was a paper form that was submitted. Their big innovation was a staple to put the two pages together so that people saw that they weren’t done yet, and adding a line at the bottom of page one that says, “Please complete page two before sending this in.”
It was not something that needed a huge tech investment. It needed curiosity. It needed some research into “Why are people missing this? What can we do? What is the smallest, easiest thing that we can do to help people solve this problem?”
Francis Rose: Tony, we’re just about out of time, so a final question to you. Are the solutions more often than we think as simple as the one that Marcy just outlined? Because we don’t think about that journey, about the techniques that somebody uses as often as we should?
Tony D’Emidio: I wish we could solve everything with a stapler. That would be wonderful. I love that example. I do think it illustrates a point, which is there are so many firms out there that are trying to sell robust technology solutions that maybe an agency can’t afford or doesn’t need.
Sometimes they are needed. But rather than be the hammer looking for the nail, you’re better off having curiosity. Then the right answer or investment can be anywhere between the stapler and the massive technology investment.
A lot of times, it’s somewhere in between. And a lot of times I’ve found in government, it’s back to that employee point: an investment in the capabilities of the employee and better connecting and listening to your employees who interact with the customers and really know what might be two, three, four simple fixes.
So a lot of the work we do when we’re doing journey redesigns with government agencies or government clients, we’ll bring together those employees that serve those customers on a regular basis and have them come up with the solutions with us. They know the problems the best.
They recognize the situations. And they’re the ones that’ll come up with whether it’s the stapler, the change in the form, the, “Hey, if we just change these three things about the process, that’s actually going to make a big difference.” It doesn’t have to be massive investments that make a big difference in the customer experience.
Francis Rose: Tony D’Emidio, Marcy Jacobs, it’s great to have you. Thanks for joining the conversation today. I appreciate it.
Tony D’Emidio: Thank you.
Marcy Jacobs: Thanks so much, Francis.
Francis Rose: You’ve been listening to McKinsey on Government, a presentation of McKinsey. Our next episode is in a couple of weeks. You can subscribe to McKinsey on Government everywhere you get your shows. I’m the host of McKinsey on Government, Francis Rose. Thanks very much for listening.