REV­O­LU­TION­IS­ING CUS­TOMER SER­VICE

Dra­matic turn­arounds re­quire coun­ter­in­tu­itive strate­gies.

Business Today - - THE HUB -

GET­TING CUS­TOMER in­ter­ac­tions right has never been more im­por­tant, es­pe­cially since so­cial me­dia has given un­happy cus­tomers a louder voice. Many com­pa­nies want to raise their level of ser­vice, but the ques­tion is, How? The typ­i­cal re­sponse is to rewrite front­line em­ploy­ees’ scripts and con­duct pi­lot projects. Those tac­tics may lead to in­cre­men­tal im­prove­ment, which is fine for a com­pany whose cus­tomer ser­vice op­er­a­tion is func­tion­ing rea­son­ably well. But if the op­er­a­tion is badly bro­ken, or the com­pany’s in­dus­try is be­ing dis­rupted and cus­tomers sud­denly have a wider ar­ray of choices, Jochen Wirtz and Ron Kauf­man, Sin­ga­pore-based re­searchers and con­sul­tants, rec­om­mend deeper cul­tural change. On the ba­sis of 25 years of work with global cus­tomer ser­vice op­er­a­tions, they sug­gest jet­ti­son­ing four con­ven­tional prac­tices, singly or in com­bi­na­tion. Don’t start with cus­tomer-fac­ing em­ploy­ees. In­stead, make sure they get enough sup­port. Af­ter all, cus­tomer ser­vice reps usu­ally un­der­stand the im­por­tance of sat­is­fied cus­tomers; of­ten the real prob­lem lies with lo­gis­tics, IT, or some other back-end func­tion that isn’t meet­ing front­line col­leagues’ needs. When that’s the case, ef­forts to re­train cus­tomer-fac­ing em­ploy­ees may waste time and gen­er­ate frus­tra­tion. So in­clude ev­ery­one in ser­vice train­ing, and fo­cus spe­cial at­ten­tion on in­ter­nal ser­vice providers.

In 2009, Nokia ini­ti­ated a train­ing pro­gramme for its front­line sales and ser­vice reps, to lit­tle avail. Their ef­forts to be more re­spon­sive to cus­tomers de­pended on greater re­spon­sive­ness from the com­pany’s soft­ware de­vel­op­ers and fac­tory em­ploy­ees, who saw lit­tle rea­son to change and deemed many of their col­leagues’ re­quests un­rea­son­able or un­nec­es­sary. Af­ter sev­eral un­pro­duc­tive months, Nokia in­cluded those func­tions in the train­ing pro­gramme as well. Over the en­su­ing year, its sat­is­fac­tion scores rose by as much as 20 per cent among key cus­tomers.

Don’t fo­cus train­ing on spe­cific skills or scripts. Ed­u­cate em­ploy­ees more gen­er­ally about what “ser­vice ex­cel­lence” means.

Com­pa­nies spend vast sums train­ing em­ploy­ees to fol­low pro­ce­dures and flow­charts when in­ter­act­ing with cus­tomers. (“If the cus­tomer says X, re­spond with Y.”) They may then mon­i­tor phone calls or use “mys­tery shop­pers” to en­sure ad­her­ence to the new rules. But highly scripted em­ploy­ees are of­ten less able to be imag­i­na­tive or em­pa­thetic about a cus­tomer’s true needs.

A bet­ter ap­proach is to per­suade em­ploy­ees to com­mit to a holis­tic def­i­ni­tion of ser­vice: cre­at­ing value for oth­ers, out­side and within the or­gan­i­sa­tion. Teach them to first ap­pre­ci­ate cus­tomers’ con­cerns and only then to take ac­tion. They should con­tin­u­ally ask them­selves, Who am I go­ing to serve, and what do they need and value most?

Na­iade Re­sorts, based in Mau­ri­tius, was strug­gling with low oc­cu­pancy rates and mount­ing losses when the global re­ces­sion hit. Paul Jones, who be­came its CEO in 2010, re­branded the com­pany as LUX Re­sorts and ini­ti­ated a fo­cus on cre­ative per­son­alised ser­vice. In­stead of train­ing work­ers to take spe­cific ac­tions, he launched an ed­u­ca­tional pro­gramme aimed at get­ting them to an­tic­i­pate and un­der­stand guests’ pri­or­i­ties and max­imise ser­vice op­por­tu­ni­ties. Two years af­ter the ini­tia­tive be­gan, four of the five LUX prop­er­ties in Mau­ri­tius were on TripAd­vi­sor’s Top 10 list for that coun­try. Fi­nan­cial re­sults fol­lowed suit, with rev­enue, earn­ings, and prof­its all in­creas­ing by more than 300 per cent over three years.

Don’t pi­lot changes. Con­ven­tional wis­dom calls for lim­ited ex­per­i­ments that, if suc­cess­ful, are later rolled out more broadly. That can work for small tweaks, but for more-sweep­ing re­forms, firms must cre­ate mo­men­tum fast and set their sights high.

In 2012, Air Mau­ri­tius could ill-af­ford grad­ual change: In ad­di­tion to $30 mil­lion in losses, poor cus­tomer ser­vice rat­ings, and low staff morale, it faced union dis­sat­is­fac­tion, height­ened com­pe­ti­tion from Mid­dle East air­lines, and un­favourable ex­change rates. The new CEO, An­dre Viljoen, knew that his goals – a re­turn to prof­itabil­ity and a four-star rat­ing – re­quired him, in the re­searchers’ words, to “go big and go fast.” He held lead­er­ship work­shops for top man­agers, “train the train­ers” pro­grammes for se­lected em­ploy­ees, and a two-day course in ser­vice prob­lem solv­ing for all work­ers. A cross-func­tional team con­ceived and im­ple­mented new ac­tions, in­clud­ing im­proved meal and liquor ser­vice and in-flight en­ter­tain­ment, bet­ter on­board pro­vi­sions for chil­dren, and a new

Highly scripted em­ploy­ees are of­ten less able to be imag­i­na­tive or em­pa­thetic about a cus­tomer’s true needs

air­port lounge. Not only were Viljoen’s prof­itabil­ity and rat­ing goals met, but Air Mau­ri­tius made the Sky­trax “Top 10 Most Im­proved Air­lines” list, the ra­tio of cus­tomer com­pli­ments to com­plaints rose by a fac­tor of 12, and em­ployee turnover dropped be­low 5 per cent.

Don’t track tra­di­tional met­rics. In­stead of wor­ry­ing about typ­i­cal cus­tomer sat­is­fac­tion mea­sures such as share of wal­let and net pro­moter scores, or­gan­i­sa­tions should look at the num­ber of new value-adding ser­vice ideas put into prac­tice. It’s not that con­ven­tional met­rics are unim­por­tant, the re­searchers say, but be­cause they are “lag­ging in­di­ca­tors,” they can bog down ef­forts to achieve rapid, dra­matic change.

For many years Nokia mea­sured cus­tomer sat­is­fac­tion with a sur­vey – one that even­tu­ally bal­looned to more than 150 ques­tions and pro­duced far more data than the com­pany could un­der­stand or use. “So we started over,” says Jef­frey Beck­sted, the for­mer global head of ser­vice ex­cel­lence. In 2010, the com­pany ditched the quan­ti­ta­tive ap­proach and be­gan ask­ing clients for open-ended eval­u­a­tions of the most re­cent ser­vice month, along with de­sired ser­vice ac­tions for the month ahead. The shift changed em­ploy­ees’ fo­cus: In­stead of try­ing to hit a spe­cific sat­is­fac­tion score, they brain­stormed ways to make cus­tomers hap­pier. Says Beck­sted: “It doesn’t mat­ter how well you’ve done as much as it mat­ters how [the client] sees you in the fu­ture.”

Not ev­ery com­pany re­quires the dra­matic over­haul that these ap­proaches aim to achieve. At Dis­ney, Zap­pos, and Ritz-Carl­ton, for ex­am­ple, ser­vice ex­cel­lence al­ready per­vades ev­ery level. And coun­ter­in­tu­itive ap­proaches won’t work if top lead­ers aren’t firmly be­hind them. “It’s no co­in­ci­dence that many of these projects were ini­ti­ated by a new CEO,” Wirtz and Kauf­man note. But for com­pa­nies look­ing to dif­fer­en­ti­ate on ser­vice, whether be­cause of com­pet­ing prod­ucts, squeezed mar­gins, or chang­ing con­sumer ex­pec­ta­tions, these strate­gies can make the dif­fer­ence be­tween slow, tem­po­rary progress and rapid, sus­tain­able suc­cess.

Il­lus­tra­tion by Raj Verma

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