service-1

Modernity brings higher expectations.

Once we were content to forage or hunt for our dinner. Now we order our steak medium rare at a restaurant or dine on Chinese food or pizza delivered right to our door.

Higher expectations now also apply to customer service. Once we were content (or resigned) to email or call an 800 number to talk to a customer service rep or tech support agent. Now we expect real-time help integrated into apps like Uber and Instagram. And we delight in proactive suggestions for how to improve our experience within productivity and messaging tools like Slack.

And who can blame us? The more attentive the service, the happier we are.

But while some of the most successful, industry-disrupting tech firms have raised the bar on customer service expectations, most companies lag behind. If your customer service operation is broken or your industry is being disrupted and customers suddenly have a bunch of other options, your company may be one of them. Using old strategies to enhance your customer’s experience with incremental improvements won’t be enough to reverse customer churn.

McKinsey.png

What’s Wrong with Customer Service in Most Organizations?

  • Customer service training doesn’t encompass other key employees beyond customer service reps
  • Employees don’t share a general definition of service excellence
  • Incremental and experimental enhancements to the customer journey are often too little, too late
  • Traditional metrics such as wallet share and average revenue per user (ARPU) often overshadow timely metrics that measure customer happiness
  • Many organizations either have too few or too many people in support roles
  • No one person is in charge of the customer experience
  • There is no clear methodology for quantifying the economic value of a great customer experience

The good news is that many professionals are studying trends in customer expectations. They’re providing companies with suggestions for how to meet and exceed those expectations with new approaches. Here are some of the best ones from the Harvard Business Review and research by McKinsey & Company.

Expand Customer Service Training to a Wider Circle

Singapore-based researchers and consultants Jochen Wirtz and Ron Kaufman have studied global customer services operations for 25 years. They’ve found that often customer service organizations are well run and staffed but that customer satisfaction problems emanate from other departments. Logistics. IT. Finance. Non customer-facing employees and teams.

The remedy: Include everyone relevant to the customer experience in customer service training.

Put New Focus on Customer Service Staffing

One recent study of sales support roles in 40 technology companies found great disparities in the number of support personnel employed in relation to sales ROI (gross margin minus total sales costs). The top 25% of companies had sales ROIs that were double those of the bottom 25% of companies. Those top companies also had 30% more people assigned to sales support.

According to the research, the sweet spot for staffing is to employ 50-60% of sales staff in support roles. Too much support can be counterproductive. The right amount frees up sales reps to be more successful. Companies with the right staffing levels in the study had a 15% lower average cost per sales employee than the lower-performing companies.

Define and Heed the Most Current, Meaningful Metrics and Ideas

One global company used a customer satisfaction survey as the primary way they measured customer experience. Over time it grew to over 150 questions, most with boxes to check on a spectrum from Great to Terrible. The data gathered was extensive. But applying it to come up with better customer service initiatives proved less and less effective over time.

So the company switched to a more qualitative approach. They asked customers for their feedback in questions that allowed for answers with a few sentences. Questions focused on their most recent interactions. Did they have suggestions for ways the company could improve?

Gathering such feedback and ideas from customers instead of quantitative data shifted employee focus from hitting a specific satisfaction score to making customers happier.

Create a Chief Customer Officer

Give someone the mandate and the power to design, orchestrate, and improve customer experiences in your company. When putting someone in this role, companies should measure their effectiveness based on some clear criteria. The CCO should demonstrate how customer experience can help differentiate the company from competitors. He or she should also lead efforts that produce happier customers and low churn. Finally, the CCO’s efforts should be calculated as a share of the company’s growth.

Link Customer Experience Program Outcomes to Real Value & Make the Program Self-funding

Research by McKinsey & Company has found that when some of the most innovative and disruptive companies launch customer-focused initiatives they rarely quantify the end results in economic terms.

The researchers offered a long list of suggestions on how to do so. Here are some of them:

  • Identify the customer behavior and outcomes that lead to value for your company
  • Make sure that what customers claim in satisfaction surveys matches their behavior over time
  • Study what makes some customers satisfied and others dissatisfied
  • Build year-over-year models of customer satisfaction, not longer-term views
  • Model customer satisfaction around entire journeys instead of touchpoints and prioritize the most remunerative ones
  • Assemble a cross-functional team to improve service
  • With data on expected value, cost, and impact of service initiatives, build self-funding business cases for customer service efforts

Yes, customers expect a lot when it comes to service these days. And those expectations are expected to grow each year. If your company isn’t one step ahead, you risk disgruntled customers and high churn. So be proactive. Listen closely to what your customers are saying. Then through creativity, attention, proper training and staffing, give them what they want.

Published October 27, 2016
block background image