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Article : Service Delivery - A Creative Approach
Service Delivery – A Creative Approach
By Doug Tanoury
Challenges in Managing the Customer Experience
Most businesses claim to use their company's customer service organizations, as a key differentiator in creating competitive advantage in the marketplace, but this does not withstand closer analysis. The service the vast majority of these companies provide is actually the same as their competitors, so the question becomes: where does the differentiation come in? What has occurred is that customer service has become an undifferentiated commodity. It is a cost companies must pay to get in the game, just as purchasing real estate, electricity and labor. It is a necessity, the price of doing business rather than a differentiator that confers competitive advantage.
Doing what everyone else is doing only better, may make a company’s customer service operation the best of the worst in the customers mind. The laundry list of things that can go wrong in managing a customer contact is endless. What makes managing customer contacts so difficult is that failure in just one of the many areas of quality (quantitative or qualitative) is a failure in the overall customer experience. The enormous complexities in managing all aspects of the customer experience relegate most organizations customer management activities to the realm of mundane mediocrity. The figure below illustrates common aspects of quantitative and qualitative quality in customer management activities:
Service as a Commodity
It is an unfortunate fact that 80% of customer service operations never reach a level of sophistication required to achieve adequate levels of quantitative and qualitative quality. For these companies their customer service operations are an organizational boat anchor that drives up cost and is an obstacle to revenue generation.
Of the 20% of organizations that do achieve operational excellence, their success is a hollow victory, because they provide the same service that every other company is, the difference being that they are much better at it. Even in the cases where companies have achieved operational excellence, their service operations do not differentiate them. They are meeting customer expectations, but there is nothing exceptional that distinguishes the experience. Their customers are merely satisfied rather than dissatisfied. Simple satisfaction is not an impressive differentiator. It is when the customer is surprised and delighted that service becomes a true differentiator.
Spending resources simply to provide what all your competitors do, only better, is simply not a high enough standard for service. Every company provides customer service, granted with varying degrees of success, but to a great extent simply doing what your competitors are doing, is no longer enough.
What brings competitive advantage and differentiation? Delivering service in new and inventive/creative ways is the key to differentiation. Services, like products, are differentiated in customer’s minds by innovation. It is that unprecedented something, unexpected and different, and only that which creates competitive advantage. Inventiveness in service delivery is what differentiates and separates an organization from its competitors.
The blueprint for success in customer management operations is to put resources, not toward what other companies are doing, but into service innovation that will astonish surprise and satisfy customers. This will truly set your organization apart and separate you from your competition. It is the creation and deployment of business processes that differentiate the customer experience from competitors that is the hallmark of superior service.
What does service innovation look like and where does a company start? Like product innovation, the first place is always with the customer. Real innovation begins with looking at a product or service in novel ways from the consumer’s perspective. It involves the revolutionary concept of "thinking like a customer". It seems simple, but remember for a moment your contact with self-service applications on the web or with an interactive voice response (IVR) system. It is obvious that these are not designed from a customer’s point of view. Even when speaking with a company representative, it becomes clear that the contact and all post contact processes are designed from a company’s perspective. That is a major obstacle to innovative service delivery.
The first great leap in service innovation is to change the focus of the interaction from serving the organization to serving the customer. The litmus test of any service process or action should be: does it serve the customer or enhance their experience? If not, don’t do it. Applying this rule to every customer contact touch point and all related processes will drastically alter how an organization interacts with its customers. It will become the foundation for service ingenuity.
The major aspects of service innovation and service design begin with a review of your industry, your competitors and finally your own company to address customers unmet service needs. This involves creativity to develop new solutions to old problems and the management fortitude to do something very different from what everyone else is doing and also from what you have done in the past. This drastic departure from the past and from the crowd is the genesis of service innovation.
Service Innovation Roadmap
Involving the Customer
Involving your customer is both the beginning and the end to the service innovation process. The real power that drives service innovation involves careful listening to what our customers tell us. What are the painful points in the customer experience? This stage is most important in the process and can determine overall success or failure. So much of what we do is based on what we think that customers want, not on what they have told us they want. There is a tendency across our industry to make these service assumptions, act on them and only later discover that what we thought customers want is very different from what they actually desire. Listening to our customers should not be a one-time exercise, but a routine practice. Sadly, we often do not ask customers and when we do inquire, very often we pose the wrong questions. A detailed hit list of problems is created by a detailed analysis of what customers are telling us. This information can be gathered through customer focus groups, interviews, meetings and surveys. Very often when sufficient information is gathered, the focus will point to one specific area such as order entry, fulfillment, access or staff.
Customer response is the only accurate measure of the effectiveness of innovations implemented in service design. Customer surveys, focus groups, interviews: all the same tools that began the service innovation process should be reapplied to measure results and form the inputs to continue the service innovation cycle
The next best indicator of success or failure is to measure changes in sales revenue. The marketplace rewards innovation in dollars. The rise of customer delight and sales revenue are positively correlated with a rise in one being indicative of a rise in the other.
Study and evaluate current service practices across your industry and markets. It will be particularly helpful to analyze and evaluate the service practices of your competitors. The final stage of this process is to objectively analyze your own service practices. This goes beyond benchmarking, for you do not want to merely compare your service practices with those of your competitors. The purpose is to address design gaps and implement those activities not currently being done in your industry or by your competitors. The outputs of this stage provide detailed analysis documents that capture process information and performance metrics. It is important that all these efforts are focused on capturing enough information so the next stage, design, is data driven.
Direct observation and detailed analysis of performance reports form the basis of Service Analysis. An example would be to listen to the Interactive Voice Responses (IVR) menu options and script of your competitors as well as your own, then map and measure their effectiveness. The patterns of what customers choose, as well as where and how they input choices must be documented. This same analysis should be completed at every point of customer interaction, such as agent staff, web, sales force, etc. Current service delivery practices must be studied in detail before the Service Design stage begins.
Design and implementation of service change must happen with our focus outward on the customer and their experience, not inward on internal processes, requirements or agendas. It is a battle for hearts and minds so go for what is dramatic and meaningful by doing something that is memorable for the customer. It is beneficial to focus on the fine details of the customer experience, and not let processes or organization structure present barriers to service. The design must not be based on opinion or conjecture but on the facts and the hard data collected in the preceding Study phase.
Even more challenging than the service design aspects is the difficulty that implementation may pose. It takes a great deal of management courage and a high-risk
tolerance to do something that is dramatically different from what your competitors are doing. It also takes a great deal of management courage to introduce a concept which is totally novel to your own organization. This venture into uncharted waters is not for the fainthearted. It not only takes management fortitude to embark on this course, but also requires support from the highest executive levels to ensure success.
A Creative Management Approach
Service innovation allows an organization to leapfrog the competition and become the service leader in their industry. Rather than increasing cost, service innovation will reduce costs and increase revenues. These are simply the advantageous byproducts of focusing service design on the customer. In order to be successful the goal of service innovation must remain focused on the customer. It must not be held hostage to a corporate agenda or hijacked for some self-serving action. It doesn’t require capital expenditures, technology or staff resources, but rather service innovation represents a modification of priorities and focus. Its vision is synonymous with the perspective of the customer. Service innovation will occur when management trades the corporate agenda for that of the customer. There is no trade secret to service innovation: it simply involves the very basic management approach of thinking like a customer.
Today's Tip of the Day - Experience And Architecture
About Doug Tanoury:
Doug Tanoury is a Management Consultant at Major Oak Consulting, a company that specializes in optimizing and improving the customer experience. He is a customer management expert having held contact center operations and management positions at AT&T, Electronic Data Systems (EDS), MCI Telecommunications, Technology Solutions Company, eLoyalty and Siebel Systems. Doug has published a number of whitepapers and articles that focus on Customer Relationship Management, ways to manage customer contact centers more effectively and innovative ways to improve the customer experience.
About Major Oak Consulting:
Founded in 2004, Major Oak is committed to several simple yet highly effective principles. This pragmatic approach – combined with our culture of mutual respect, true collaboration, and a razor-sharp customer focus -- enables us to meet and exceed expectations in each and every engagement.
Published: Sunday, March 27, 2011