How does digital, and customer experience fit into organisational structures?

Paul Boag

Digital is forcing businesses to reorganise, creating new teams of digital specialists and customer experience experts. However, these teams do not fit neatly into existing departmental structures, and that often leads to conflict.

One of the most common questions I get asked is “which department should our digital professionals report into?” I hear similar questions about customer experience staff too. In both cases, these are understandable questions because these roles cut right across existing organisational boundaries. Digital has become business-critical for almost every part of a business. Equally, practically every department in an organisation is shaping the customer experience.

To make matters worse, because they are such high profile functions, they often attract political manoeuvring as different departments seek to control the new territory.

The result of this infighting often leads to teams being divided or reporting into committees. In both cases, this significantly undermines their effectiveness and ability to adapt to changing consumer behaviour.

However, the opposite scenario can prove equally damaging. When a single department gains control of these functions, it can often skew their remit to an unhealthy degree. For example, a digital team which reports into marketing spends the majority of their time using digital for marketing purposes, when it has so much more potential.

What then is the answer? How do you integrate these cross-departmental functions into an existing organisational structure?

Focus on The End Goal

The first thing to have in mind is the end goal. We must avoid digital or customer experience becoming ‘just another department’. Customer experience and digital should be as ubiquitous within an organisation as electricity. They should be things that should be intrinsic to every team’s operations. However, that will not happen overnight.

Even electricity did not become ubiquitous overnight. Organisations needed to discover how to integrate it into the way they worked. That meant that many organisations appointed Chief Electricity Officers, in much the same way organisations today are appointing Chief Digital or Chief Experience Officers.

Integrating digital best practice or a customer-centric culture doesn’t happen overnight. It is a journey.

Protect the New Culture with A Dedicated Team

In the early days of a new business function, organisations need people who will champion and promote these functions. That is especially true for digital and customer experience where the danger is the new culture required by these innovations fails to get established in the face of the status quo. As a result, pre-digital companies that try to integrate a customer experience or digital culture across their entire organisation from day one rarely succeed. There is just too much legacy, and the new working methodologies get crushed.

So in the short term at least, it is necessary to have dedicated teams for these new functions. That team provides a place where we can do things differently, and it creates a safe place to nurture a new culture. However, this once again brings us back to the question of where this team should report.

A Board-Level Appointment Is Often the Best Option

One option is that a board-level appointment heads these teams and reports directly into the executive. This approach certainly has many advantages, including clearly indicating the importance of the new group. Crucially, the seniority reduces the chances of the team’s culture getting undermined by organisational legacy.

However, understandably, many organisations may be reluctant to add another position to what is often an already bloated executive team. Also, you could argue it is unwise to add a department like this to the executive when ultimately that team should disband, and their work becomes mostly ubiquitous.

Nevertheless, I encourage my clients to consider adding digital or customer experience to the board for a limited term. That helps establish it at the heart of the company and gives it the best chance of flourishing.

Where this isn’t the case, we return to the question of where these functions should sit within the organisation. The answer to this question is that in my experience, it doesn’t matter if you handle it correctly.

Focus on Setting up The Right Team Structure

We have already established that organisations need to embrace both digital and customer experience at all levels. Therefore, wherever you choose to place the central team, this is only ever going to be a part of the story.

The central team is necessary to begin with, to establish new working practices, ensure consistency and standards, as well as encourage collaboration between departments. However, before long, some of their work will need to start moving back into other departments.

Staff report into a central digital team, but sit with other business units.
In the hub and spoke model, specialist staff sit with individual business units but report into a centralised team that coordinates operations.

The secret to a successful cross-departmental, collaborative team of this nature is to adopt a hub and spoke model. You have a central department, which can sit pretty much anywhere in the organisation, and various spokes that the organisation embeds in appropriate business units across the company.

Team members embedded in the spokes, still report into the central team, but they sit and work daily with the units into which the central team have placed them. This approach has many advantages.

The Advantages of A Hub and Spoke Approach

First, by ensuring that the spoke team members report into the central team, it provides consistent working practices across the organisation. Priorities, processes and strategy are all driven from the centre, making sure that the organisation embraces a customer-centric and digital-first approach.

Embedding spoke members into other teams also ensures that the central team does not become isolated. If that happens, the best practice they create will stagnate and fail to propagate through the rest of the organisation. Too often, these centralised teams turn into another business silo, and the innovations they introduce fails to integrate into the broader organisation.

Having the spoke members also prevents the central team from becoming fixated on its agenda and ensures it remains relevant to the rest of the business. That is particularly important when the central group is a part of a bigger business silo such as marketing. With staff embedded in other teams such as product or I.T., it ensures that the team’s focus is as much on these areas as marketing.

Factors that Dictate the Success of Hub and Spoke

The one thing to note about the hub and spoke model is that it is reliant on two things to work correctly. Those in the spokes must physically sit with their embedded teams and yet need to still report into the central group.

If these employees report into and sit with the same people, you lose the power of the model. If they sit and report into the centre, they become detached from the rest of the organisation and the team becomes another business silo.

Equally, if the employees sit and report into the separate departments rather than the central team, you end up with a lack of coordination, a duplication of effort and often conflicts over who is responsible for what.

Why Hub and Spoke Works

The hub and spoke model is an excellent approach for breaking down silos and encouraging cross-departmental collaboration. However, it is also a superb tool for instigating cultural change in an organisation. That is because the central team allows a new cultural space to establish itself, while the spokes introduce that culture to the rest of the organisation.

The result is that the hub and spoke model is a superb way of helping organisations establish a more customer-centric culture. However, it is equally suitable for assisting them to adopt design thinking and digital best practice. It is hardly surprising that so many organisations are choosing to embrace it.

Stock Photos from Wright Studio/Shutterstock