Because it is time you take Customer Service seriously..

Pimping Serious Business by Bryan BruchmanDespite the economic crisis, the rise of the “Social Customer” and the popularity of Customer engagement strategies through Social Media, I sometimes get the feeling that managers in Customer Services put in a lot more effort to ensure the company does not get bad press, or negative “buzz” in stead of providing a better then expected Customer service experience. We know companies do not always take Customer service seriously. I think though many managers of Customer Services should start taking their discipline a lot more serious than they are doing today..

Apart from the fact that it is useful to improve waiting & ticket-processing times, Customer’s self-service capabilities, complaints handling, first contact resolution, quality monitoring scores and what have you.. I believe there is a necessity for a more fundamental change in both the mental model and governance systems guiding current design and execution of Customer Services operations. Not only because great Customer service can be a differentiator, but mostly because Customer service needs a (mental) makeover for it to really become one.

The best service is no service

To date, the best proxy for good and effective Customer Services (operations), has been set by Bill Price, with his book (and proven methodology) “The Best Service is no Service”. You can see a good summary in this slideshare presentation.

Key to the methodology is that it very closely looks at what contacts are of value to the Customer and to the company, continuously eliminating contacts that are of no value to both, by means of improved processes etc. Furthermore reducing time and Customer effort as well as implementing self-service capabilities for high value contacts to Customers OR company. Last, but not least, investing in those contacts regarded valuable to both Customers AND company.

The methodology basically prescribes you to:

  • Listen to “What (y)Our Customers Are Saying” (WOCAS)
  • Improve your products and processes so that you do not get repeat contacts and many complaints
  • Implement self-service with the utmost rigor possible
  • Use the remainder of contacts to do smart up- & cross-selling
  • Segment your service (e.g. better service for high value Customers)

And if you do this well, you’ll see that your Customer services unit does not have to grow, or can even shrink in headcount (significantly!), whilst company revenue can double and transaction volume can multiply with a factor five (Amazon case).

Five perspectives

Whilst I believe there is a lot of greatness to be found in this methodology and/or approaches like Lean/SixSigma, which have similar claims and approaches, I believe we need a more fundamental change in perspective to get out of the “call center is the end of the line or the organization’s drain”-paradigm. And, of course, to finally start having a real and sustainable impact on business results, not just sitting on the cost-side of the equation.

I would like to explain so by elaborating on the “Five perspectives on Customer Services” we need today.

  1. The Value-perspective
  2. The Customer-perspective
  3. The Experience-perspective
  4. The Relationship perspective
  5. The Network-perspective

These perspectives are hardly new, you may say or think. And I would agree. Combining these perspectives and projecting them onto Customer services operations shows though we are far away from integrating the logic, the views and ideas that can be found in these perspectives. All the more reasons to take a closer look.

1. The Value perspective

The most important shift in logic and customer services governance we need to make is the shift in our value logic. The entire governance system is based on a value-logic that embraces value to the company and aims at maximizing Customer value extraction.

The current value logic has been perfected into such detail that almost every KPI the industry uses breathes value-to-the-company on each contact. Some examples:

  • A call cannot take longer than 5 minutes
  • A call must be solved within the first contact in 80 % of all cases
  • A service representative cannot have more than zero fatal errors or 2 non-fatal errors in her quality monitoring sheet.
  • Customer satisfaction on the call must be at least a 6 (on a scale of 0 – 10)

The “transaction” or “interaction” (=the call) is central to all we are doing. Contact Centers are managed by the day, the week at most. even the quality management systems put in place look at the transaction. 3 mistakes on a call, and you’re out. Maybe, just maybe this improves Customer Satisfaction on the call, but if this also relates to improved value to the company as a whole, or the Customer in specific, is only assumed, if at all. Besides that: satisfactory results are good enough, most certainly if it’s possible to reduce costs further without reducing Customer Satisfaction.

This all may be a little better in the Best Service is No Service approach, but even there it is the contact and the transaction that is center to the approach and the upper right corner of the value to the Customer vs Value to the Firm matrix shows “sales campaigns” as one of the activities to fit in there. I would argue there is no value to the Customer in being sold to..

Goods versus Service Dominant Logic

To put it bluntly: the Customer Services management system is designed with a production-based logic from the pre-war decades of the previous century. The founding fathers of Service Dominant Logic (Vargo & Lusch) name this old logic a “goods dominant logic”.

It is time, contact center and customer services operations management switch to a Service Dominant mindset. A mindset that understands that the Customer can bring more to the table than money alone, like knowledge, feedback from her experiences, on all touch-points, not just the regular survey or after the “feedback”-button. A mindset that does not see service as something offered after the sale, but as the basis for value creation between company and Customer. And a mindset that values the role of the employee, not just the value he/she is able to extract from the Customer in exchange.

And whilst the “Best Service is No Service” approach is more than half way of this direction, most Customer Services (operations) needs to redefine what it means with “Value Center”, for the current understanding and application has “goods-dominant-logic” written all over it. More guidelines as to what this means can be found in the four remaining perspectives.

2. The Customer Perspective

I did not only not put this one first to avoid the obvious trap, but more so because I wanted you to understand first, from the previous paragraph, that from my point of view most Customer Services operations are not about Customers. They are about transactions. Throughout my career I have not seen one Manager Customer Services reporting Customers, not transactions. Not one of them could say, on a weekly bases even, how many Customers dialed in, and how many have been helped to their satisfaction.

They can tell you how many calls they handled, and what the average satisfaction score was, but they cannot tell you how many Customers are considered at risk for retention, because they had a complaint. But this was not logged as a complaint, because the Customer did not use the complaint procedure (usually sending in a written letter.. )

Hardly any Customer Services manager will be able to tell you how many unique Customers call into the call center or visit a service site in any period, nor what the calls of the heavy users are about, compared to the light users.

To cut it short: any Customer Services department that has not already should get started tomorrow on building a Customer centered view of their operations, not a transaction based view. I guarantee you the “a-ha.. now I see what’s the issue” look on your face.

3. The Experience Perspective

Furthermore it is of vast importance to stop seeing service as something just offered after sales when something went wrong. From the Customer’s perspective everything you do is service (or not, most of the time ;). The way service is perceived is through the experiences Customer have over all your touch-points. From the fine-print to the mail-delivery company used, to the advertisements in a magazine (with a coupon for new Customers with a nice discount..), to the invoice, the payment arrangement, the collections calls etc etc..

And, more and more experiences from others are part of the Customer’s perspective of the service you provide, through ratings and reviews shared by others, whether shared through (online) social networks or not.

Understanding the Customer’s journey throughout her lifetime should go beyond listing Customer Services as the after sales touch-point. The role of Customer Services should also go beyond providing feedback and (actionable) insights to the organizations as to (incrementally) improve the Customer Experience. Customer Services should expand their horizon by understanding the Customer’s journey and how their key-capabilities to help Customers when things are not running smoothly, could be put to use to improve the Customer’s experience when getting her job done.

4. The Relationship Perspective

The fourth perspective is the Relationship perspective. Not new either. CRM traditionally consists of Marketing, Sales and Service. In the name of CRM though, many companies have done their very best to exploit their relationships with Customers at the lowest possible costs. And when the relationships comes to a divorce, companies even ask for alimony. CRM is not there to improve the Customer’s nor the employee experience, CRM is there to improve the company’s control.

In stead of conversion-rates, revenue per hour or per contact, I believe the next generation Customer Services will need to make a serious effort to manage their Customer interactions with respect for the (individual) Customer’s lifetime value, network value AND referral value. These long-term relationship-indicators should shed a different light on what is important to manage on a contact, and which contacts are of value to the company and/or the Customer.

5. The Network Perspective

Last, but not least: in the name of CRM the 1 on 1 relationship between Customer and company is center. In the meantime, in Customerland, the Customer, increasingly armed with numerous social tools, cannot only solve issues better herself, she can do so faster than you can, and most of the time even better. Where your legal department is still fighting over wording issues, to avoid future compliance or other legal actions, your Customer is already doing what has been advised by her peers or “experts”.

Where many companies are stars in describing what situations are NOT covered by Customer services, companies that see themselves as service providers to their Customers, arrange for their Customers to have access to networks of Customers and/or experts, outside the company firewall, to increase the likelihood that the best resolution is offered in the fastest possible way, with the least possible Customer effort. Please take a look at this post by Laurence Buchanan about GifGaf to see the benefits of this Network perspective.

To conclude

Best practices in Customer Services are hard to come by, mostly because bad Customer service stories have better reach and because there is more to gain for the story-teller. The best methodology so far comes from the heart and mind of Bill Price: The Best Service is No Service. I do think though Customer services in general, and the Best Service is No Service, are in need of a thorough iteration, based upon the latest insights and developments.

The five perspectives discussed above are not new in a stand alone way of discussing. I wanted to bring them together as guiding principles, with practical implications, for the future directions of Customer Services management and governance. Directions that go beyond operational excellence, process efficiency and other tactics. Because it is time we take Customer services seriously..

Please share with me your thoughts!

This post is an iteration of this post in a Dutch digital magazine. I wrote that article in collaboration with Fred Zimny, who I’m grateful for his own fresh perspective and contributions on the Dutch article, which now resulted in this improved version, imho, of it. Thx Fred!
 
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28 responses to “Because it is time you take Customer Service seriously..

  1. Pingback: Tweets that mention Because it is time you take Customer Service seriously.. « Wim Rampen's Blog -- Topsy.com·

  2. Excellent post Wim!

    You’re right that none of this is actually new but putting it all together like this in a comprehensible manner is definitely refreshing.

    I will be forwarding this post to my colleagues in support, professional services AND sales. It isn’t just customer service that needs to redefine how they see themselves.

    I’m also saving it to re-read in detail and think about how all of this comes together and may be back to comment again.

    Thanks!
    Eric
    @ericjacques

  3. Wim – best blog post I’ve read this year. It is true that even many companies that think they are customer-centric are looking at customers through their own lenses, not the customer’s.

    Don’t apologize for the content because it’s not new! There is a reason we need “church on Sundays” reminders – the most important things are often the easiest to forget.

    Best wishes
    Mark
    @MPFriedman

  4. Pingback: Because it is time you take Customer Service seriously.. « Wim Rampen’s Blog « Fredzimny's CCCCC's·

  5. Great post from you and Fred–you’re both heroes of mine. I can’t wait to read The Best Service is No Service. Eliminating friction and irritating contact points is a worthy goal. I also have a pet peeve about being able to find and follow answers by self-service: knowledge and processes should be easy to get and easy to follow. To this end, I champion the step-by-step tutorial.

    I love the seven principles of Best Service, especially the idea of creating engaging self-service. Easy to aim at and hard to do. Any resources or case studies you can share with our readers?

    Thank you for being such great thought leaders in customer service.

  6. Really interesting article. I like the idea of a customer journey and that from the customer’s perspective all contact with the company is part of the overall experience.
    We are working with some colleges to improve their interaction with their business customers in particular and the phrase customer journey in this context incorporates all aspects of their relationship with the customer. Perhaps the education sector can teach us something after all?

    Keep up the good work.

    • Not sure what you mean by this Tristan.. What insights am I hiding? How should I highlight my contribution? It’s my post and my insights written here..

      Can you be a little more specific? Thx

      Wim

  7. Hi Wim

    Yeah, some more specifics:

    In Section 2 on Customer Perspective, the paragraph starting “Hardly…” contains a key insight. Measurement is the key here, and selection of KPIs. Your focus on which KPIs allow certain insights is very valuable, but your build-up was large, so we have to struggle a bit to get at the juicy bits.

    I understand that you are building a thought framework and that a blog is all your thoughts.

    • Ha.. agree it’s can be struggle to get to the juicy bits..

      My key-purpose of blogging is to provoke thinking and providing a framework and direction to do so… I don’t give out easy to swallow chunks of things one should do, because what one should do, depends highly on the context in which one operates.. There are two ways to get the juicy stuff:
      - think it out and experiment yourself within your context
      - hire me to help you thinking it out for your context ;) #shamelessselfpromotion

      And.. my posts usually are not very light reading. I try to make every word count (and fail at it too;) and I put in “hidden gems” or “puns” because I enjoy doing so. Regular readers of my blog usually recognize them, because I tend to repeat them in different shapes.. and we tend to discuss these topics on twitter as well..

      Thx for the feedback and I hope to see you back here and on Twitter.

      Wim

  8. Ha – yes! One of the reasons I enjoy your blog is that you have got strong views.

    Unfortunately I’m not in the position to hire (#contractor).

    Your blog also highlights an interesting phenomenon – most organisations I have worked with (and am told, around the world too) are not really interested in much beyond their immediate and localised pressures.

    Is this a problem because companies aren’t building their holistic approaches and strategies to their operations or is it because they are failing to communicate and motivate their workers to fulfil the grand plan?

  9. Hi Wim,

    as promised, I’d like to leave some thoughts on your truly great post.

    First of all, I like the synthesis of your five perspectives quite a lot. I think, their combination reflects the basis why and how to put the customer in the centre of consideration very well. Obviously, there is still a huge lack in executing these perspectives and insights in the daily business.

    I’m no service expert at all but many of your thoughts and issues are valid for innovation, too. Many studies reveal that it’s widely acknowledged that innovation is one of the most crucial success factors for companies. On the other hand, execs (consciously) don’t seem to undertake the utmost to make innovation happen. This also affects how to address and integrate customers in the innovation activities.

    I recently came across the following NYT article titled “Seeing Customers as Partners in Invention”:
    http://www.nytimes.com/2009/12/27/business/27proto.html?_r=1
    Here, R. Gulati says: “Companies aren’t generally structured to access, absorb or utilize customer insights since they are organized by product, not by customer.”
    This made me thinking and it seems to be one of the root causes for the customer-related issues in companies. Moreover, it’s likely related to what you address in terms of goods vs. service dominant-logic. In most of the cases, service is handled as a product too in order to fit the organizational structure. As you have pointed out, service is something “offered after sales when something went wrong” – a kind of extension of the actual product. This implies that success measures are product-related as well.

    The customer experience perspective is strongly taken into account through the design thinking approach. As experience innovation is more and more upcoming, design thinking seems quite promising to me, particularly for service purposes.

    My conclusion: as long as the impact of truly customer-centered organizations has not yet been fully understood, there will be a lack in customer-centered execution.

    What do you think?

    Cheers, Ralph

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  18. Outstanding post, Wim, and I find it particularly compelling right now. In fact, it’s inspired me to use the perspectives framework to rewrite an ‘emotional, angry customer rant’. You know the one.

    I’m going to revisit the entire event experience, but present key insights & lessons using this as a guideline, and sans the angst. I’m hoping it will help inspire the org to aspire to improve upon their own practices & principles.

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  20. Great post. You highlight a really important point, I think, which is to stop thinking about service as a cost center, a function you roll out when something goes wrong, but rather to see it as a key driver of customer value and competitive advantage.

    Of all the organizations we studied in Uncommon Service, Zappos (the web retailer) seemed to get this the most, in the sense that this mindset — service is our advantage — is central to the culture and shows up in every operational choice. In one small example, Zappos call center operators are encouraged to stay on the phone for as long as it takes, and long call times are a badge of honor. It’s an organization that lives what you preach, Wim.

  21. Hi Wim,

    I agree with manu of your thoughts. I assume part of the reason you re-posted this article is because we hardly see the changes you mention. I actually see lots of blogs and articles with basically the same message and your message in this article: we have to take service (more) seriously.

    My question is: who do we need to convince? Sometimes I feel customer service profesionnals are not able to reach the audience using the right message. I believe the reason why the role of service is still under pressure is that it struggles finding it’s place within a dominant financial and short term oriented policies/strategies within companies. As a result of that short terms (mainly cost oriented) service KPI’s are dominant.

    What’s your opinion on this issue? Do you think that ‘taking service seriously’ will mainly come from service professionals helping and challenging eachother or that we also need to develop a clearer story towards ‘board’ audience to enhance the value of service?

    • Hello Christiaan,

      Thx for the comment. To your answer: I think it’s the service professionals that need to develop a clearer story. They can do so in three ways:

      First:
      A clearer story with regard to tangible results that benefit the company. Take any of the above perspectives and link effort and metrics on them to CSAT, Share of Wallet/Lifetime Value, Loyalty and Cost-savings. You and I know there is a clear link. Most service professionals know there is a link. They just have to stop complaining and start doing something about it. Even when the pressure is on accessibility and AHT.

      Second:
      Reach out to your Marketing, IT, Finance and Ops colleagues and work together. Many service professionals are standing with their face to their operations and with their backs to their own organization. You can’t get any of the results mentioned above without working together closely along the customer journey.

      Third:
      Share the (good Customer Service) stories. Not only internally but externally as well, on your web-site, social media etc etc.. As long as your stories are about numbers, you will be treated just like that. Make your stories about humans, Customers and what the experience is they’re having, and you’ll raise awareness.

      Bottom line: don’t wait for the board to ‘get it’.. go do it.

      What do you think?

      Wim

      • Hi Wim,

        I fully agree with your points. Service professionals should put more (offensive) efforts in influencing the governance of companies. I am afraid these skills are rare among the current professionals and that we need to:
        1. Invest more time and effort to develop these skills (and hopefully hire higher more professionals with the skills mentioned) For me, we currently have a strong need for ‘attitude’ (less than ‘technical’ customer service) skills among professionals who understand that they have to widen their service influence, scope and coorporation.
        2. Develop more better and clearer links between service objectives and (short term) financial results. To do so, we need to deepen the theoretical side of service from a financial point of view and – like you mentioned – a much more intense corporation with other departments.

        In relation to the 2nd point: If there is enough solid evidence – and I think there is – it could be worthwhile to make an overview and structure of all statistical/ financial prove in relation to service, especially aimed on value rather than costs. What do you think?

        Chris

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