Steve Downton, Downton Service Management Consultants Ltd, Noventum Group
I have previously commented on the overwhelming evidence that customer satisfaction surveys do not give an accurate picture of the opinion of the customer. This article will seek to establish why customer satisfaction surveys can be unreliable and how successful companies communicate with their customers to provide consistent reliable information about how best to support their customers, creating loyalty as well as real satisfaction.
Most service operations provide service level agreements which guarantee standards of service such as respond or restore same day, next day etc. Discussion with a customer to decide upon their requirements should elicit a number of different scenarios, configured in a variety of ways, with the result that the way a SLA is set up will vary enormously; consequently, its true relevance can vary significantly and is often open to misinterpretation.
If all the customer’s requirements are accurately assessed and fully documented and the measures and results of the SLA proceed as agreed, it does not necessarily mean the customer’s are being satisfied at all levels, and as requirements continually change may result in a shift away from the SLA. In the same way, satisfaction surveys may once have portrayed an accurate representation, however now, no longer perform as an operational tool but have been morphed into a marketing tool. The SLA and survey tool may be operational but they could have been established with the purchaser of the service and not the user; if communication between purchaser and user is poor, service expectations might vary significantly from service paid for.
Differences between expectation and delivery have led many suppliers into some very difficult discussions, with the service engineer/support engineer and the user effectively becoming scapegoats, and no one winning. The basis for this misunderstanding (different expectations of SLAs) generates from a lack of knowledge by all parties; unless there is effective dialogue, the situation can deteriorate to disagreement and a broken contract. The ultimate point is that, more often than not, it is the role of the supplier to deal with communication breakdown (as with the teacher spotting the pupil misbehaving – the teacher has seen it many times and knows what to look for – the pupil thinks no one has ever played such a clever trick before).
Not many companies put their performance on the line publicly, but recently the MD (Steve Ball) of a&o systems + services UK Ltd – one of the finalists of the National Customer Service Awards (NCSAs) – explained the value of the NCSAs assessment process and the importance of the need to have close dialogue with all levels of customers. Deputing staff at different levels of the organisation to speak and work with all relevant contact points in the customer organisation will ensure a constant input on issues, causes and solutions to enable rapid resolution and minimum fuss and frustration.
Every action has a cost, and the best customer service attribute to offer is to be low cost; squaring this circle can prove a hard task: unless there is investment the cost in poor feedback etc. contributing to lost customers is enormous. Unfortunately, most companies do not even have a base mechanism in place that really understands their market and customers, and those with a poor mechanism quite often appear not to understand how to develop or use the mechanism effectively in the new environment. A number of high-profile company CEOs/MDs have endorsed the need to change attitudes and to stop trying to tell the customer what they want; begin to listen to the customers and work with them to find out what they need. Inflexible attitudes result in an inability to provide solutions that will offer differentiation from competition, so the realisation of the need to listen to and action customer needs has to be accepted.
Good “Customer Radar” has a number of components, but the fundamental aspect is the ability to act upon information quickly. Too much emphasis can be placed upon dealing with symptoms (sore nose and throat, sneezes) rather than tackling actual causes (cure for the common cold), and so excellent interpretation and diagnosis is also an essential feature of understanding customer needs: gathering customer information doesn’t guarantee effective results unless it is used correctly and the results fully applied. One of the biggest mistakes has been to assume a better knowledge of the needs of the customer than the customer, without verifying the facts. Occasionally, suppliers will have additional insight, when innovation and anticipation of needs can be capitalised on, and the opportunity can be grasped to add significant value to the customer; failure at that point is often because we can’t connect the two (Customer’s needs and insight) as we do not fully understand the customer experience.
Companies that accept the reality of the marketplace will become highly tuned to their customer and, most importantly, make the most of the symbiotic relationship with the customer by utilising any available information as quickly as possible.
Figure 1 shows the features of the relationship between a customer and supplier, underlining the need to balance what the customer gives and receives: if the customer values a service, they will pay; if the service has no value it simply becomes a cost for the supplier.
Figure 1
Innovation, awareness and anticipating needs will be the aspects to focus on, in part in response to the new generation of customers with significantly different requirements than in the past, and a new cohort of suppliers will have to step up to the plate, in this very different environment from even 5 years ago.
There are some mechanisms that can help companies to develop and apply customer radar more effectively, including developing the customer interface team and growing their competencies. Figure 2 shows a schematic of how our brains are balanced between emotion and logic and demonstrates the 4 keys areas that customer interface staff need to develop and strengthen. Critical basics include a strong awareness of the product and services provided, and the value of the combination; the impact of service on the customer, and the importance of efficient and effective delivery; ways of relating to customers to build and sustain a relationship; the need to be professional when delivering a role – and how key these skills are to success for all companies.
Figure 2
Once the key elements in the customer experience are understood it is possible to identify which competencies, processes and IT are required to match customer expectations with the actual experience. A business seeking to determine the Customer Experience will need to know the observed brand values (why the customer has chosen them) to define what the customer values. This is achieved by understanding the elements in the Customer Experience that influence the customer’s brand perception. These elements include such aspects as the competencies of the customer interface staff, as competence in people skills and efficiency are becoming major issues when we consider service. When properly trained and motivated, staff will make a real difference to a business; however, putting cost before quality and skill of staff has led many a company into serious customer issues – demonstrated by reputations tarnished by poorly trained or poorly skilled call centre staff or field engineers. Saving costs when in contact with customers, in today’s climate, can represent a reprehensible choice, and will not be labeled astute management.
The difference between good customer service and poor customer service can be as little as 5%. One of the top Olympic teams in the recent winter Olympics, normally guaranteed a place in the top 3, came outside the top 10. When their coach reviewed their performance he found that if they had done just 5% better across all the disciplines they would have won Gold. In the hot-house which is now the customer environment, with demands continually being ratcheted up, being good is no longer enough – companies have to be great. The difference between making and losing money is a small fraction very often dependent upon the quality of the staff and the processes they manipulate and the way they work with the customers to gain insight and awareness of what matters to each and every customer to fully understand their customer needs.
The value in really understanding customer needs is clearly evident – research by all the major business research organisations agree – last year an increase in customer retention of 5% could boost profits 25-85%; this year in the current climate this has increased to as much as 105%, an incredible return on investment by any measure. This can be acheived by making sure that the customers see you as innovative, caring and easy to do business with and that they are better off through working with you. Only when you are really listening to the customers and they are aware of your attentiveness will they divulge their real needs. Providing customers with tangible business benefits at all levels will ensure an effective dialogue is in place and your customers will stay.
