Pegasystems (NASDAQ:PEGA), a leading provider of strategic business applications for business process management (BPM) and customer relationship management (CRM), recently hosted over 3,500 people for its annual user conference, Pegaworld. A big theme of the conference was the importance of having agile systems and processes that allow businesses to consistently create the kinds of experiences that will extend customer relationships — even as customers and their growing expectations evolve at accelerated rates.
But, according to Build for Change: Revolutionizing Customer Engagement through Continuous Digital Innovation, a recent book authored by Pega’s CEO and founder Alan Trefler, companies are not moving fast enough to keep up with behavioral changes customers are going through, which is causing what he calls an oncoming “customerpocalypse.” Trefler recently shared with me what exactly is the customerpocalypse and why he feels many companies will not survive it. He also discusses why he’s not worried about bots and machine learning technology putting executives out of business just yet.
Below is an edited transcript of our conversation. To hear the full podcast click on the embedded player below.
* * * * *
Small Business Trends: Maybe you can give us a little bit of your personal background.
Alan Trefler: I actually came to the world of computing and software through a brief career as a professional chess player and chess master, and then got into trying to teach computers to play chess. And there was a lot of fun back in the old days before computers began beating us up so badly. But what happened is as I got exposed to new ways of thinking about computing and intelligence systems.
Then I went and worked in industry and was blown away by how badly we used systems and how unfortunate it was. I found there was a huge disconnect between the way people wanted their technology to work and how it actually worked and it was really destroying the customer experience. And that led me to found Pegasystems about three decades ago with the vision of creating a model driven approach to tie it all together so you could provide great customer service and do fulfillment at the same time.
Small Business Trends: Customerpocalypse. What is it, as it sounds kind of nasty.
Alan Trefler: Well I think it’s going to be devastating. We’re all used to seeing TV shows about the zombie apocalypse. Well what we see today is customers are becoming increasingly disenfranchised and are frankly expecting more from organizations, and are able through social media and other channels to just devastate companies that don’t live up to those expectations. So organizations are going to find faster customer switching, but also much more ability for their disenfranchised customers to make that broadly known. So companies really need to raise their games at a time when that’s increasingly difficult.
Small Business Trends: We hear the terms customer experience and customer engagement thrown around quite a bit. But how is customer experience actually driving customer engagement initiatives?
Alan Trefler: We see organizations that are talking about it a lot but most of them are really messing it up. What you find particularly in medium sized organizations or larger is often they’ll have multiple departments; each department thinks that it owns a channel. So you have the folks in the digital channel trying to create the perfect website. And folks who own the mobile app trying to create the perfect mobile app and people in the contact center who are trying to answer questions from clients coming in. Well if those three things are disconnected, the customer experience in any one of them can be great, but the overall client experience being served in their channel of choice is going to be a disaster. It’s not going to be consistent; they won’t be able to start in one place and finish in another. They’re going to be chopped to smithereens. It’s not thinking through the customer journey as it relates to going into cross channels. Thinking about customer journeys that might be in selling something or serving something when in fact you need to think about that in the end-to-end dimension from sale all the way through to support and continuity. And you also have to think about it in the multi-channel dimension to make all the channels operate according to the same set of rules, the same insight. And that they build on each other’s experience to make stuff great for the client.
Small Business Trends: I don’t know if we’re calling it a customer evolution or revolution but customers are changing in their abilities to adopt technology faster and faster, and then adapt their lifestyles to take advantage of what that technology can do. How quickly are companies adapting?
Alan Trefler: I think most firms are going much too slowly and a lot of times when they do they move in ways that don’t actually break down the silos.
Small Business Trends: So does that mean that most companies are basically using this modern technology to apply the same traditional ways of doing business?
Alan Trefler: Yeah I think so I think you see a replication in the way people are doing CRM of what’s happened with Siebel which I think is largely now you know turned out to be a complete mess. Siebel was a dominant CRM system but they required you to copy your data into their application. And as a result things were always going out of sync and always confused. You know see these cloud based CRM systems and by the way technologically the cloud is terrific but the way that a lot of them are being applied is people are forced to copy their data into the cloud. You know that was stupid when we did. 15 years ago, and with the benefit of hindsight if even more stupid now.
Small Business Trends: How do you see things like machine learning and artificial intelligence and the rise of digital assistants shaping things?
Alan Trefler: We have built into our technology adaptive learning so our system can evaluate the next best action recommendations. See what you’re working on, and tune them over time. And this is part of the industry leading to real time interaction management technology that we have. I think something that’s central to making sure your systems stay smart. Relative to things like chatbots and other things, we plug into typically what customers currently have. Frankly most of those are not yet ready to fight off the customerpocalypse. You know most of those are a little too close to that Clippy character that we all used in the Microsoft operating system years ago, and we remember what happened to Clippy.
Small Business Trends: What’s the best way for companies to avoid customer-pocalypse?
Alan Trefler: Well I think it involves a new way of thinking; it involves getting business and IT to work together differently. It means you need to think about more than just what’s immediately in front of you and how to fix a client’s work concept in one channel, and think how you’re going to go omni-channel. And I also say in my book that it means you need to move beyond having humans write computer code to fill the gaps in their systems, to being able to have a model that’s extensible that allows the computer itself to write the code. That’s kind of our take on expert systems because our system lets people model how they want their business to run and then we write the java code. And then if you change how you want to run we rewrite it. That really incorporates a whole new level of agility into an organization.
Small Business Trends: I just read an article asking that question – will bots and machine learning basically take over the executive decision process; not even needing the executive anymore.
Alan Trefler: I think our generations are safe from the rise of the machines. These things are going to take a long long time. Now, I can’t even get Siri to do what I ask her half the time.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.