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Actual Experience puts the customer at the heart of the digital experience

The simplicity of Actual Experience’s hosted software masks the huge amount of time invested creating the algorithm that tracks the customer experience.

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I’d never been quite sure what Six Sigma was until I met Dave Page, chief executive of a newly floated tech firm, Actual Experience (LON:ACT).

I could be tongue in cheek here and say I thought it was a new martial art – because Six Sigma has champions, black, green and yellow belts, depending on a practitioner’s expertise.

But actually I knew it was a method of quality control pioneered by Motorola during the late 1980s and championed by Jack Welch when he was in charge of General Electric.

What I didn’t know was what Six Sigma meant practically. I found out the process is about having as few defects as possible – 3.4 per million, or 99.99966% of the products being perfect, which in mathematical parlance is Six Sigma.

To get there – and few businesses really do – it requires putting the customer at the centre of the manufacturing process to create the best possible fridge, car or mobile phone for the lowest achievable cost.

The Japanese auto manufacturers were the first to realise building something that was reliable that people wanted to buy would increase sales.

I am old enough to remember when the first Datsuns started rolling into Britain’s showrooms. The quality chasm between this shiny new breed of saloon and British Leyland-inspired classics such as the Marina and Allegro was palpable.

 “You were lucky if the British cars turned up with the right number of doors,” remembers Page.

“The quality and cost of the Japanese cars coming in was, by comparison, incredible. They did so by putting the voice of the customer at the centre of quality.”

This quest for near perfection, while putting the consumer at the heart of the process, has been commonplace in manufacturing for some 30 years now.

However, that eye for detail is singularly lacking within the digital economy. And rather than suffering just over three defects per million, the glitches are far more frequent.

Here’s where Page, Professor Jonathan Pitts and their company, Actual Experience, fit in.

Building on 10 years of research by Pitts, referred to as The Prof by Page, the company has developed an algorithm that assesses the digital experience.

More pertinently it does so through the lens of a user logging onto a website or grappling with the latest piece of technology.

“We use digital products and services in the home, office and increasingly on the phone. We are aware of digital quality; often it is not good and this is an issue,” says Page.

“When a video buffers, or a web browser is lost, that is when digital quality is lost.

“This comes about and yet the biggest single expense of a business line is that investment in the digital supply chain.

“We do digital supply chain management. What we are trying to do in the digital world has already happened in the physical world.”

The simplicity of Actual Experience’s hosted software masks the huge amount of time invested creating the algorithm that tracks the customer experience.

Measurements are made and sent to a data centre that produces a digital quality score that is a little like a credit report.

The group is normally called into a business hit by complaints, but where the dashboard for that particular part of the digital infrastructure shows ‘green lights’ saying it is working perfectly.

“Vast amounts of digital revenues are coming through businesses’ front door and they are waking up to the fact that digital is not a technology issue, digital products are a business issue where quality and cost are key,” says Page.

“We are a tool for businesses to take control of their digital supply chain and increase the quality and bring costs down.

“There is so much latent economic value that goes missing.”

The service is charged via a subscription, with the customer paying according to how often they use the software.

There are hundreds of companies that look at performance in a technical, linear way, but none of them can recreate the digital voice of the customer that is at the heart of the company’s technology, Page says. 

So Actual Experience is unique in this respect – and its stock is growing, with a number of multi-nationals already using the technology.

Page believes 2015 could be the breakthrough year for this fledgling business. “We have probably a dozen large opportunities,” he explains.

“Some are already customers and if we are right we see them growing significant revenues per month because they have colossal scale.”

Being able to predict when these multi-nationals will turn on the taps is almost impossible to predict – and it is why the company’s broker, N+1 Singer, is holding off trying to forecast sales or profits. At this stage it simply could not be done with any accuracy.

This lack of visibility doesn’t perturb the cornerstone investors, IP Group and Henderson, which first came in during a pre-IPO funding round.

“We have a set investors who are really investing on the belief we will prove some of these big businesses will grow large scale,” says Page.


Quick facts: Actual Experience PLC

Price: 114.5 GBX

AIM:ACT
Market: AIM
Market Cap: £53.98 m
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