Finally a silver lining to the cloud!
The UK Customer Satisfaction Index (UKCSI) asked more than 24,000 people to rate how well or how badly companies and organisations performed in 12 key public and private sectors. Overall satisfaction levels continue to increase to a UKCSI of 72 out of 100, compared to a score of 71 when the previous index was published in July 2008. The survey reveals 72 per cent of consumers expect organisations to improve further in the coming months.
With consumers seeking value-for-money products and services, companies are making greater efforts to impress their customers, keep them happy and prevent them slipping into the clutches of competitors.
The first signs of real service improvement appear in a major new survey from the Institute of Customer Service (ICS) - the most wide-reaching measure of customer satisfaction throughout the UK. Despite concerns over the economy, more customers say they are pleased with the way they are treated.
"With satisfied customers much more likely to return and remain loyal, good customer service is vital to survive the recession," says ICS executive director Robert Crawford.
"This rise in customer satisfaction shows that companies are getting serious about service - as they must be - and are taking steps to improve. Offering excellent customer service is the only differentiator left today. Consumers are increasingly looking for better value-for-money, so providing great service is the best way to ensure they choose a business ahead of its competitors."
Tuesday, January 20, 2009
Thursday, January 15, 2009
Customer Focus is more than Customer Service
On my website I have for years had an orgazational performance oriented Customer Focus Self Assessment. From the database I have built up, I have compared the top quartile and the other levels of self assessed organizational performance.
It is clear that the Say-Do gap between intentions/aspirations towards customer focus (Say) and various aspects of implementation (Do) is considerably wider for those organizations below the top quartile level.
What Is Customer Focus?
It is an organizational competence: Customer-Focus is an aligned whole-organization approach to customer satisfaction and service in which Leadership, Processes and People are all customer-aligned.
In broad stokes, this means that:
- Every action is shaped by a relentless commitment to meeting and exceeding its' customers expectations regarding product and service quality;
- Internal processes are constantly evaluated and improved to meet or exceed those expectations;
- Employees are aware of their role in maintaining a valued relationship with their customers.
Three External Performance Levels
I found an article by executive recruitment firm Egon Zehnder that identified these three externally focused performance levels of Customer Focus with which I agree.
- At low levels, one is willing to help customers by providing them with what you know you have. Gathering information about the external customer and listening to feedback represents a low level.
- At moderate levels, the perspective moves from "what does the customer need today" to "what will the customer need next." You know the customer from the inside, which means you can predict how s/he might respond to a given offering and you can anticipate future needs that one may address.
- At higher levels, one becomes proactive in shaping the customer value proposition well beyond the transactional relationship - a trusted advisor who is intertwined with the customer's decision-making processes.
High performers build complex relationships with customers and, based on their deep knowledge of the customer and marketplace in which they compete, they provide services that customers do not yet know they need. High performers' insights about customers become a source of competitive advantage for both their own company and their customer's business.
Perhaps you can identify with any of these three externally focused levels? And, if you want to really know how you stack up as an entire organization, why not take the 10 minute self assessment on my website? www.customerfocusconsult.com
What say you? Any comments or insights?
Thursday, January 8, 2009
Lacking Customer Focus can get your company in trouble... in at at least nine ways.
I came across this information from Douglas Morse, Managing Principal of the Services Transformation and Innovation Group LLC . I think he is so 'spot on' that I would like to share it with you. Way to go!
9. You focus on product sales and not on customer value.
If you just measure and reward around how much product that you sold last quarter or last year and you don’t maximize the value of those products for your customer, you won’t have a lot of repeat business. The scorecard for your company must focus on things like Time to Value, Customer Loyalty etc.
8. Services profits are used to fund product R&D but you have no Services R&D function.
Innovation is important to product companies. If the products need to be innovative why aren’t the services that surround them? If close to half of your revenue and profit comes from after sales or value added services, how can you not leverage investments in innovation to include Service?
7. You still have a department or separate organization called "service" or "support".
Not only do you have a standalone silo within your enterprise but you make the customers painfully aware of the separation. Quite likely the service organizations are operating with differing and often conflicting metrics than the rest of the enterprise. Driving customer value and customer experience requires that an enterprise works holistically and seamlessly for the benefit of the customer.
6. Your CEO says, and believes, that the services revenue and profit would not exist without the products.
Don’t bother to memorize the CEO’s name; I am sure that his replacement will be much better. There are famous CEOs who actually believe that service would not exist without innovative products. The SONY walkman was a very innovative product but people are buying IPODs today by the millions. WHY? Product innovation alone does not deliver value. This is another example of Darwin being right…
5. Service Innovation, to you, means disintermediation of tasks (like self service ) or by cutting heads and moving them to Timbuktu.
Labor arbitrage is not innovation. Labor arbitrage is a management technique to hide problems through “cost” reductions. No one creates innovation by moving the same old work to new and cheaper labor markets. Transferring tasks that you used to perform to customers as a way for you to save money is also not innovation. Replacing bank tellers with ATMs and forcing the customers to use them to avoid long lines did not add value. Providing access to banking services 24x7 did.
4. Only the services or customer facing groups are measured by "customer satisfaction".
Many companies survey their customers but only a few employees are held accountable. How a customer feels about your product or company and their desire to continue doing business with you is a result of the sum total of all experiences that they have with you. Everyone from the CEO to the Janitor must be held accountable for customer delight. Everyone has a role. If a role in your company does not contribute to customer delight, get rid of it as it adds no value. Once people start to understand their role in delighting customers, you would be surprised with the turnaround of a company.
3. There is no organization in your company that has the title of ‘Customer Experience’.
Go read a book called the “Chief Customer Officer” by Jeanne Bliss. While point number 4 says everyone contributes to customer experience, who do you have that helps to design, create or innovate around customer experience? Customer experience is a complex set of issues and should involve a number of specific disciplines. You might have the best products in the world, you might have top notch services supporting the product and perhaps adding great value, but experience is an emotional state created over time. One bad event erases all the positive ones. This needs to be a core competence in your company.
2. You are expected to deliver improved margins on services even though the product quality is not being forced to improve.
The product group believes that time to market is the number one goal but the service manager is expected to reduce costs as the volume service problems go up. This never happens, right? Alignment of the enterprise is key. Organizations cannot survive with competing objectives. No soccer (football) team ever won a game by having everyone on the field focused offensively on scoring a goal and leaving the goalie as the only person on defense. Winning the game means the right balance of offense and defense is used. Why would it be different in a corporate environment?
1. You have never invited your customer to participate in your strategic planning sessions.
If your goal is to deliver customer value, how can you plan without customers participating? If service is about value co-creation, as it is often defined, how do you do it without the customer as a major player? While I do not mean this in the literal sense of having customer dictate how you operate your business, how do you know that what you are planning to do is going to deliver expected value? Companies that are well plugged into their customer’s value chains are leading in their markets.
9. You focus on product sales and not on customer value.
If you just measure and reward around how much product that you sold last quarter or last year and you don’t maximize the value of those products for your customer, you won’t have a lot of repeat business. The scorecard for your company must focus on things like Time to Value, Customer Loyalty etc.
8. Services profits are used to fund product R&D but you have no Services R&D function.
Innovation is important to product companies. If the products need to be innovative why aren’t the services that surround them? If close to half of your revenue and profit comes from after sales or value added services, how can you not leverage investments in innovation to include Service?
7. You still have a department or separate organization called "service" or "support".
Not only do you have a standalone silo within your enterprise but you make the customers painfully aware of the separation. Quite likely the service organizations are operating with differing and often conflicting metrics than the rest of the enterprise. Driving customer value and customer experience requires that an enterprise works holistically and seamlessly for the benefit of the customer.
6. Your CEO says, and believes, that the services revenue and profit would not exist without the products.
Don’t bother to memorize the CEO’s name; I am sure that his replacement will be much better. There are famous CEOs who actually believe that service would not exist without innovative products. The SONY walkman was a very innovative product but people are buying IPODs today by the millions. WHY? Product innovation alone does not deliver value. This is another example of Darwin being right…
5. Service Innovation, to you, means disintermediation of tasks (like self service ) or by cutting heads and moving them to Timbuktu.
Labor arbitrage is not innovation. Labor arbitrage is a management technique to hide problems through “cost” reductions. No one creates innovation by moving the same old work to new and cheaper labor markets. Transferring tasks that you used to perform to customers as a way for you to save money is also not innovation. Replacing bank tellers with ATMs and forcing the customers to use them to avoid long lines did not add value. Providing access to banking services 24x7 did.
4. Only the services or customer facing groups are measured by "customer satisfaction".
Many companies survey their customers but only a few employees are held accountable. How a customer feels about your product or company and their desire to continue doing business with you is a result of the sum total of all experiences that they have with you. Everyone from the CEO to the Janitor must be held accountable for customer delight. Everyone has a role. If a role in your company does not contribute to customer delight, get rid of it as it adds no value. Once people start to understand their role in delighting customers, you would be surprised with the turnaround of a company.
3. There is no organization in your company that has the title of ‘Customer Experience’.
Go read a book called the “Chief Customer Officer” by Jeanne Bliss. While point number 4 says everyone contributes to customer experience, who do you have that helps to design, create or innovate around customer experience? Customer experience is a complex set of issues and should involve a number of specific disciplines. You might have the best products in the world, you might have top notch services supporting the product and perhaps adding great value, but experience is an emotional state created over time. One bad event erases all the positive ones. This needs to be a core competence in your company.
2. You are expected to deliver improved margins on services even though the product quality is not being forced to improve.
The product group believes that time to market is the number one goal but the service manager is expected to reduce costs as the volume service problems go up. This never happens, right? Alignment of the enterprise is key. Organizations cannot survive with competing objectives. No soccer (football) team ever won a game by having everyone on the field focused offensively on scoring a goal and leaving the goalie as the only person on defense. Winning the game means the right balance of offense and defense is used. Why would it be different in a corporate environment?
1. You have never invited your customer to participate in your strategic planning sessions.
If your goal is to deliver customer value, how can you plan without customers participating? If service is about value co-creation, as it is often defined, how do you do it without the customer as a major player? While I do not mean this in the literal sense of having customer dictate how you operate your business, how do you know that what you are planning to do is going to deliver expected value? Companies that are well plugged into their customer’s value chains are leading in their markets.
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