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David Allenstein Managing Director

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The Institute of Customer Service

SERVICE DIFFERENTIATION THROUGH PEOPLE

Paul Cooper Business Development Director March 2002

Why is Customer Service Important?

• Customers now have a right to expect good service • The successful organisations of the future will be those whose service levels are better than their competitors • The successful organisations of the future will be those whose service levels exceed customer expectations • Organisations will increasingly rely on customer facing staff to make the difference • Satisfying customers will become the difference between success and failure

DO YOU, YOUR MANAGEMENT AND YOUR STAFF

ALL KNOW AND ACCEPT THIS?

Why Bother With Customer Service?

Primary Reason for Customer Defection to Competitors

Core Service Failure Service Encounter Failure Pricing Inconvenience Response to Complaint Competitor Attraction Ethical Issues Involuntary Other 0 5 10 15 20 25

%age responding

30 35 40 45 Source - Griffin Business Network

Potential Dangers of having a Customer Service Department

• All other departments, and managers, stop taking responsibility for customer service!

• CS department spends life making excuses for all other departments to customers • CS department represents customer internally – clashes with all other departments!

• CS department only recognises the external customer, but may be too far away from them • Wrong objectives – e.g. to reduce complaints • Seen as a cost, not an investment

Research Results – 1

• “Personally, it seems to be a brick wall - they don’t listen and are not flexible at all” • “Lack of staff and completely lacking in Customer Care. They had no knowledge of the service that they offer ” • “Once they’ve sold you something, they’re not interested” • “You are made to feel they are doing you a favour rather than the other way round” • “They treat you as a number, not as an individual” IN THE UK TODAY, VERY FEW PEOPLE RATE THEIR EXPERIENCE OF CUSTOMER SERVICE AS EXCELLENT - DUE TO POOR ATTITUDE AND TRAINING Source: MORI 1998

Research Results – 2

Customers today: • demand increased access time - 24 hours 7 days a week • are less willing to wait - average time callers will accept being on hold has reduced dramatically • insist on more immediate response - expect the person to deal with the request, with enough authority, NOW • demand more information - must be kept up to date • need effective recovery - if things do go wrong, speedy and effective resolution is required • make more complaints - more willing and quicker to complain THIS WILL CONTINUE, AND ACCELERATE Source: Bain & Co/ICS report 1998 - The Future of Customer Service

People Conclusions

• Much more rounded and trained professional individuals are required in front-line customer service roles • They all need excellent inter-personal skills, plus many or all of the following: – numerical skills, verbal reasoning, IT competency, commercial awareness, authority, status, self-worth • They must be able to resolve customers’ problems as they arise • Which means having the self-confidence, latitude and knowledge to do so Emerging Skills for a Changing Economy – Colin Armistead ICS 2001

Research Results 3

• “One of the surest signs of a bad or declining relationship with a customer is the absence of complaints” • “Staff recognition - this is almost non-existent---A ‘thank you’ now and again wouldn’t go amiss.” • “My organisation does not listen or respect any ideas of improving the service we provide.” • “So what? It is worth bearing in mind that we only have to be as good as the competition and there are barriers to clients switching that make them loyal and dissatisfied. So why improve?” A POSITIVE COMPLAINTS CULTURE IS NEEDED TMI/ICS National Customer Complaints Culture Survey 2001

Research Results 4

Headline from Design Council Complaints Survey 2001:

“Most companies ‘aim to delight’ their customers, but their suppliers fall short of the mark!”

• 87% of companies said their goal was to “surprise and delight” their customers” • 40% complained that what their customers were now demanding was unrealistic • 85% said that their suppliers weren’t trying to “surprise and delight” them! In other words –

“It’s always someone else’s fault”

Research Issues 5

ICS latest research –

“Service Excellence = Reputation = Profit”

by Bob Johnston – Warwick Business School Four characteristics of excellent service (by frequency of mention): • 13% - They go the extra mile • 14% - They make it personal • 25% - They deliver the promise • 48% - They deal with complaints and queries brilliantly

Net Comparison Graph - changes 2000 to 2001

National World Class Results 2000/2001 Comparison

80 / 10 Rule 100 90 80 70 60 50 / 20 Rule 50 40 30 20 10 0 -10 -20 -30 -40 -50 53 62 23 39 29 35 -11 -16 7 24 20 26 -5 0 19 24 30 32 8 16

World Class Positiv e Conce rn Dange r

National 2000 National 2001

Best and Worst Organisations

Worst Company (Leisure) Best Company (Retail)

-80 -70 -60 -50 -40 -30 -20 -10 0 10 20 30 40 50 0 10 20 30 40 50 60 70 80 90 100 1. Basic attitudes towards complaints 2. Encouragement & accessibility 3. Processing complaints 4. Training 5. Empowerment 6. Willingness to change 7. Staff recognition 8. Customer service policy & systems 9. Customer information 10. Internal customers

Concern Positive Danger Concern Positive World Class

Acting on the Same Stage

“Old borderlines are evaporating, old categories are merging. The divisions between commercial, public-sector and non-profit organisations are becoming blurred. All organisations now act on the same stage, and need to justify their place on that stage.” • The Big Idea – Robert Jones

It’s Different in the Public Sector

• OK, it is! A bit. • Not a profit motive, but surely still a cost control motive, and an attitude to get it right • Reputation = great place to work = lower turnover = government recognition = job satisfaction = public recognition = target achievement = honours list……

The ICS Vision of a Great Organisation

• The organisation is honest, gives good value for money, has a high reputation, meets deadlines, has quality products and services, has easy to understand processes, responds to criticism, encourages complaints and handles them well, and demonstrates that it is passionate about customers • At all levels the people are respected,well trained, friendly, contactable, flexible, knowledgeable, honest, empowered (trusted), stable, involved and consistent • The perceived culture is one of professionalism, efficiency,

teamwork, caring, respect, seriousness, but with a touch of

fun and character

What Gets You There?

•

A Corner Shop approach

•

A People Recognition approach

•

An Accreditation approach

•

A “Technology in its place” approach

•

A Complaints is a Gift approach IT’S GOT TO BE IN THE CULTURE!

Seven Things to Think About

• The key always has been, and always will be, the people • Employees are probably more important than customers • People turnover in most organisations is the biggest single drain on resource, knowledge and finances • Last year, large organisations spent around ten times more investment money on their technology than on their people • Nearly 70% of all CRM programmes today aren’t working to the customers’ satisfaction • Staff Training was the poorest rated factor in the TMI/ICS 2000 NCC Survey • In 2001, it was the only factor to get worse

Some Misconceptions I

•

There is no such thing as a “Call Centre Industry”, a “CRM industry”, or an “eService Industry”

•

They are just means of delivery – the process

•

The “Industry” is Customer Service, and this must be paramount in the operation of the company DON’T LET THE PROCESS RUN THE BUSINESS!

II The Call Centre Choice

•

The WRONG reason for setting up these is to save money, or cut headcount

•

The RIGHT reason for setting them up is to provide much improved customer service THEREFORE…..

III It’s Clear…

•

Good Companies set up good Contact Centres

•

Bad Companies set up bad Contact Centres

Inside vs Outside Help

Listening to staff is critical because… • They care • They are involved and concerned • They use same processes – test track • One needs beacons not lighthouses

The Service Profit Chain Simplified Higher Employee Satisfaction:

- leads to improved Customer Satisfaction - leads to improved Customer Loyalty - leads to improved PROFIT

SO……...

•

You can fail if you haven’t got it right within your company - staff & processes!

•

Therefore you can’t just edict that you are now a customer focused company! You need your people!

What Gets in the Way?

• • • • • • •

Not enough priority, or enough time Middle Management - not good coaches “Cost control” v “investment in future” clash A fear culture in the company Suits, closed doors, segregation, status Forms, procedures, petty rules Hiring the wrong people; not treating them right; not developing their skills

So How DO You Do It?

Make it CLEAR what you want. Then...

• • • • • •

Leave them alone more - Give them more freedom, authority, and praise Walk the talk - keep being consistent Talk to them - ask opinions - act Review structures - how many layers? Check out ALL your processes Create culture of recognition/ accreditation

Getting the people right

• At interviews, RIGHT questions • Hire for attitude, train for skills • Proper Induction - how do they feel when they go home?

• When they join they are keen, bright, alert, happy. How long to lose this?

• Lifetime Learning programme for all – Qualifications/Awards/ICS membership.

And keeping them!

• • • • •

Headcount turnover is major problem in US and UK today Cost of advertising/hiring/training/ loss of skill MUCH more than you think!

Best leave - most go to competition A positive alternative to redundancy? ACTIVE programme to help them stay

What REALLY gets the results in Customer Service ?

• • • • • • • • • • •

Long term commitment from the top + Leadership by a champion Best recruitment practices + + Professional induction Formal recognition/accreditation + + Fair competition/incentives for staff + Measure right things/feedback + Empowerment Enhancement of status Welcoming complaints + + + Good rewards EQUALS

The real reason for doing all this!!!

= MOTIVATION = PROFIT (REPUTATION)

Benefits to All Organisations

• Improved customer satisfaction • Improved customer retention • Increased business with happier customers • Increased word-of mouth recommendations • Improvement in organisation’s prestige • Universally recognised for high quality service • Life-long Learning for all staff • Better quality, happier workforce • Lower staff turnover/higher retention • Support to quality programmes • Better basis for recognition/appraisal systems • Increased reputation/lower costs

The Answer to Life the Universe and Everything

• So why, as customers, are we still treated so badly, so often, by so many?

• So why do employees rate so many of the organisations they work for as so poor?

• So why are complaints rising through the roof, and happiness with responses dropping like a stone?

• So why are so few organisations doing it right?

The Institute of Customer Service

“Our role is to make you more successful in your job”

Thank you

bestpractice .uk.com

David Allenstein Managing Director

Promoting best practice in customer service & service delivery

Best Practice Training & Development

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