9 Customer Service Principles Essential for Any Business

How do you apply your customer service principles in practice? Did you even list your principles?

Customer service is paramount for every business, whether it´s online or offline. That´s why customer service principles are so important.

Being a member of an online service provider (Karma CRM), Sarika Periwal knows what it means to apply them.

I agree with his Principles, but if had written them I would have called the first one Leadership and embedded commitment in it. This is the most critical one: No organization rises above the level of its Leaders.

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The customer is king for a company and to keep him happy and satisfied is the main aim of any solvent business. So how do you organize your company customer care services in such a manner that this all important goal is met?

You follow a set of essential customer service principles which allows you to keep your customer satisfied with the minimal of fuss.

1. Commitment – is required to serve the customer well at all levels. You need top management, middle management and supervisors to be just as committed as the actual individuals who come in touch with the client.

2. Credibility – a man’s word can make or break his personality. If the man delivers on his promises consistently his credibility increases over a period of time and so does his reputation. With a company it is no different. The credibility needs to be built by building trust with the customers.

3. Culture – the customer service ethos needs to be a built-in part of the company culture. The fact is that no company can survive without their customers and it needs to be driven into the heads of all employees of the company. Without any customers the company and their means of employment will not exist.

4. Competency – of the staff play an important role in keeping a good customer service ethos. The staff that is chosen during recruitment should fit in with the company’s vision. They should then be trained in the way the company does business and be assessed doing the job at frequent intervals. That way the staff of the company stays competent.

5. Responsibility – is the key. There must be one consistent authority within the company who is responsible for all customer service issues. There needs to be a clear head to approach within the company who is entitled to take decisions instantly in given customer issues.

6. Resources – are vital. No one can work without the right tools. Imagine sewing a button on a shirt without a needle. It can’t be done. So what the company needs to ensure is that there are always adequate resources available for the policies to be followed effectively.

7. Quality – as long as your product and service provides the customer with consistent quality there is little to fear. However a constant effort must be made to give the customers relevant inputs and review their reactions to hone your company systems.

8. Feedback – while the feedback from customers is important there is one aspect of feedback most companies tend to neglect. That is the collection of feedback from the employees who are dealing with the customers. There is so much your own staff can tell you if you would just care to listen.

9. Continual Improvement – is required to meet and exceed the expectations of the customer. The identification and management of all customer service issues is what helps the company to grow not just its customer base but also its reputation and profits.

Great service does not always lead to customer loyalty

From the blog of consultant Mitchell Osak.

Conventional wisdom says that consistently providing service excellence will deliver high levels of retention. According to new research from the Harvard Business School, this is not always the case. Companies that offer high levels of customer satisfaction may still experience loyalty problems if competition offers even better service. In fact, the research suggests that the customers you think are your most loyal are likely to be the first to jump ship when a challenger to your service superiority enters the market.

The researchers, Harvard Professors Dennis Campbell, Frances Frei and doctoral student Ryan Buell explored the link between service levels, customer loyalty, and competitive strategy in the U.S.banking sector. The 2002 to 2006 study analyzed data collected from a large U.S.domestic bank that competed in more than 20 states.

The study’s findings confirmed some earlier research on the impact of corporate and service strategy on retention. In a nutshell, companies who generate high customer satisfaction scores remain at risk when competition raises the service stakes. Conversely, the research indicates that firms rated low in service quality are relatively immune to premium competitive service offerings.

The reasons for these counter-intuitive findings have a lot to do with the customer expectations established in part by the incumbent provider. The longer a firm has held a service advantage in a local market, the more sensitive are its customers to it service levels relative to those of competitors. Given their higher expectations, service-driven customers are more willing to try other firms and products that trumpet and deliver service excellence.

Despite these conclusions, managers should be mindful of throwing out the service baby with the bath water when setting strategy. The study found that even though high-end customers can be fickle, a company can still attract and retain customers in a variety of markets with a superior customer experience. There are a number of ways to do this:

Avoid complacency

Firms can avoid resting on its service laurels by staying abreast of customer needs, focusing on continuous improvement initiatives and proactively investing to significantly enhance their customer service experience.

Consider each product category separately

Customers will trade off price and service depending on the product they are seeking and the importance they attach to it. In general, customers – in the long run – purchase the goods that represent their ideal combination of price and service. As such, delivering more service than is needed (or is willing to be paid for) would be sub-optimal.

Understand that service sensitivity varies by market…

According to the researchers, there are considerable differences in the type of customers you attract and retain between markets. This variance suggests that managers should tailor their service and marketing strategies depending on local market conditions, competitive threats and customer needs.

…But be wary of too much customization

Local market service strategies come with considerable costs in terms of operational complexity and brand dilution. Firms need to carefully weigh the pro and cons of service customization for each market.

Make it difficult to leave

If high service levels by itself won’t ensure loyalty maybe raising a customer’s switching cost or providing loyalty-based incentives would do the job. For example, managers could offer discounts for long term contracts, extend warranty periods or launch high-value loyalty programs.