Customer Focus in a Slow Economy

For the last ten years I have worked in strategic partnership with Ray Miller. Ray wrote a great article which I am happy to endorse. Here goes...

I wanted to call this article “Sharpen Your Customer Focus or You Will Lose Customers!” but a few of my colleagues (including Eric) thought this was a bit too blunt. Absolutely true mind you, but blunt.

Then I thought why not make the headline a question; “How Many Customers Are You Willing To Lose Today Because of a Lack of Customer Focus?” Again, true but too direct. So in the end I went with what you see above.

So here we are again. The economy has been getting tough and for many, life is now stressful and difficult. For business, this is not new. We’ve all been here before. Hopefully we’ve learned from the last time the economy slowed … But then again, have we?

Nobody wants to lose customers but you know as well as I that when the economy gets tough, many organizations go into reactive mode. Their focus shifts to cost control and the acquisition of new customers. History has taught us that every time this happens, relationships with existing customers can be put at risk. Financial responsibility is important, as is getting new business, but not if it is at the expense of your existing customers.

Allow me to explain.

During an economic downturn most customers will be looking to increase value for their money. They will try to make their hard earned cash go further and you can be sure that they will be more critical when making buying decisions.

With less disposable income, customers will be less forgiving of a mediocre or poor service experience. And don’t forget that when it comes to service, the vast majority, 90 to 96%, will not complain and most will simply go elsewhere. You can bet that they will want to deal with organizations that demonstrate that they want and appreciate their business.

You can also be guaranteed that your customers will be strongly influenced by the commentary of their friends, acquaintances, family and colleagues when it comes to recommendations for products or services and providers.

As I mentioned earlier, when economic conditions become more demanding, far too many organizations focus on cost cutting and acquiring new customers which invariably puts the relationships with their existing customers at risk.

Quite often training budgets are the first to get cut. This includes all important training on things like Customer Service and Leadership.

Process improvement plans get put on hold often including process improvements that were intended to enhance the customer experience.

Even though it is five times more expensive to get new customers than it is to keep existing already profitable customers, many organizations bolster their marketing efforts trying to pull more customers in the front door, at the same time virtually ignoring their existing customers who simply walk out the backdoor looking for someone who wants and appreciates their business and proves it through their actions.

The retention of existing customers is all the more important during difficult economic conditions. Research proves that existing customers are more profitable and improvements in your operating expenses and resulting bottom line can be achieved through maintaining a high level of customer focus. Just to remind you, don’t forget a five percent increase in customer loyalty can contribute from 25% to 125% directly to your bottom line.

Remember that your customers always have the choice of buying from you or your competition. When times are tough, that choice becomes even more important.

Implementing a customer focus strategy will create valuable and long-lasting relationships with your customers that will provide a secure and growing revenue stream.

Focusing on getting the customer experience right is critical. Making sure that your customers choose you over your competition is essential. If you get it right when times are tough you will certainly reap the benefits and rewards of unleashing the power of customer focus as conditions improve.

So this time, why not dare to be different. Why not unleash the potential of customer focus, while everyone else has their eye off the ball.

Ray Miller is the Author of That’s Customer Focus! and The Customer Focus Companion and Managing Partner of The Training Bank

The Training Bank is a full service training and development firm which specializes in fully customizable Leadership, Customer Focus, Service Excellence, Management and Supervisory Development training.

Visit his websites at http://www.thatscustomerfocus.com/ and http://www.thetrainingbank.com/ or call him at 416-698-8230. Please tell him Eric Fraterman sent you? He will be pleased to be of service.

Managers essential to excellent customer service and experience management

Reference is often made to the People – Service – Profit chain, to point out that success in achieving excellence in customer service and customer experience management begins and ends with People management.

Middle managers are an essential organization ingredient to make this happen. Yet, so many companies, especially the (often technology based) fast growing ones frequently promote relatively young people based on technical competence. The balance between the competence to "managing things" and "lead people" is often uneven.

Leadership expert Jim Clemmer in a recent Leadership Letter (worth subscribing to) points out these key challenges facing newly appointed managers:

Knowing Thyself - It's natural for new managers' egos to become a bit inflated. After all, it's a big deal to get promoted. But it's important after coming down from that "high" to ask yourself "is this what I really want and does it fit my strengths and passions?" Too many managers accept a promotion because there may be more money, or they covet more power. Taking a hard look in the managerial mirror would result in many more happy offices.

Servant Leadership - Highly effective managers serve and support the people on their team. Too many new managers see their role as command and control.

Navigating Change - It's easy to be pulled "below the line" and feel victimized by major changes in an organization. Strong leaders make people hopeful. They help their teams navigate through tough times. It is the leader's mood that most impacts the team.

Coaching and Developing - I agree with Peter Drucker; the central role of a manager is developing people. This is where a new manager may have a real challenge because his or her natural strengths may be to do work and handle problems. Making the transition from solving problems to making sure people have the skills to solve problems is a big change.

Tame the E-mail Beast - Technical tools are great for informing, staying in touch, and operational management. But we don't lead through e-mail. Most people are overwhelmed with data, analysis, and the sheer volume of daily e-mails. New managers must counterbalance IT tools with verbal communications.

Deal with the Moose-on-the-Table - It's often easier to avoid tough conversations or touchy topics. That's like ignoring a moose standing in the middle of the meeting room table. Everyone knows it's there and is annoyed by it. It takes courageous leadership to initiate those difficult conversations or to hear the team point out that leadership behaviors are doing more harm than good.

Upward Leadership - Many new managers think their main role is leading people on their team and perhaps influencing peers. But strong managers also work hard to lead their own boss or influence the bigger organization. They refuse to be victims of weak direction from above.

8.75 Ways to improve the Customer Experience

I just read one of those blogs that made me think: I fully agree and I could not have said it better. This blog hits a lot of nails on the respective heads. So, I would like to relay it and mention that this post was by Pierre Hulsebus of the EHTC Technology Solutions CRM Team.(CRM Rocks)

These are the 8.75 Key Recommendations:

1. Build a Diverse Team: Customer experience initiatives teams are often comprised of people who are responsible for customers across the organization. We suggest a diverse group from sales, marketing, customer care, administration, and management.

2. Design Processes from the Customer’s Viewpoint: Mapping the customer experience requires your team to walk in the customer's shoes for a while. The exercise will reveal the difficulties that customers have working with you. Build a touchpoint map that lists the touchpoint, customer importance rating, and customer satisfaction rating for each one.

3. Actually Listen to the Customer: Feedback is a better indication of faulty processes and procedures than surveys. The challenge is not how to solicit feedback, but actually listening and taking action on the suggestions. Confronting internal process managers with raw customer feedback can be very painful. However, when the changes are deployed as the customer suggests, this needs to be communicated to employees and the customers who offered the feedback. Customer communication is a two-way street. They need to hear back from you that you heard them and that you worked to improve their experience.

4. Get Up Close and Personal: Personalization is complex, and complexity can mean increased costs for the company. But increasingly, customers are expecting an Amazon.com experience. Organizations mastering offerings and services tailored to customers' expectations are beating their competition by almost every measure. Reward customer loyalty with personal attention and friendly, helpful, and caring employees.

5. Build Institutional Memory: Ensure that information gleaned from a customer at one interaction is not forgotten later on. Customers hate repeating their stories. From their perspective, they think we all work together and know everything about them because they just told the last person at our company the same information. So they get irritated when the next touchpoint in their journey does not know what happened before.

6. No Sacred Cows Allowed: Extending hours, or giving web access to order history are typical first steps, but organizational improvements often take courage, innovation, and risk. The team should be transparent and clear, open-minded and inclusive. Basically, everything should be on the table and nothing should be so sacred that it can not afford to be changed. This is where a committee structure can often be detrimental to success, as a committee will often skip over process improvements that are too hard, even though the reward may be very high. Failure needs to be allowed, and risk need to be taken.

7. Get An Attitude Adjustment: I have stated often that the lowest paid employees in a company have the highest effect on a customer’s perception of value. Training employees to how to behave with customers on the phone, in person, or in writing will make a good experience better. It is personal “one on one” interaction that defines the core customer experience.

8. Eat The Whole Enchilada: Taking charge of the experience from end to end is not an easy task. Expect resistance and barriers from people. Many of the managers that are stake holders in their specific processes fail to realize that their process, although important to company policy, may be negatively affecting the customer. You will find these the most difficult issues to deal with.

8.5 Pull Up A Chair You Are Going To Be Here A While: You may want to change team members every six months but this process will never be complete; it is a journey not a destination. The process is a continuous quality improvement, unless you never expect your customer’s needs or wants to change. This process of improving the experience will keep going moving as long as customers needs and wants change.

8.75 Embrace The Ambiguous: Solutions to effective customer improvements are locked up in the heart of your customers. What improvement is going have the good ROI, or please customers enough to stay longer, or spend more money with you is often a mix of common sense, innovation, and failures. There are a lot of “Best Practices” that consultants are can bring to the table. The ones that work best vary from project to project.

Remember that most of your customers like working with you. Let their wishes, feedback, and direction be your guide.

There is no better way to measure the customer service strength of a company than by the quality of the choices its employees make every day.

Several of my blog entries have echoed the chorus of people who emphasize that great service and an endearing experience is all about people. My first blog entry on this topic was bluntly called: It's about people, stupid...

No surprise then that I felt compelled to quote below a section of an eloquent article by the excellent and insightful author Lior Arussy, published on MyCustomer.com . The emphasis is on the numerous interactions taking place with customers and front line employees such as call center reps, tellers, (inside) sales people, order desk people, etc. Each Moment of Truth provides an opportunity for influencing the perception of the company or the brand. Each interaction will require the front line person to make choices and it is in the final analysis the quality of choices made by employees that matters in winning from the competition.

Quoting Arussy: "Daily choices take place in front of external and internal customers every day. They are dominant in interactions with other people, including staff meetings, email exchanges, phone conversations and in any situation where an individual is in a position to help someone else. Any time there is a recipient on the other end of the action, there’s a daily choice involved.

The real power of organisations is their ability to create excellence, to differentiate themselves and, as a result, to build strong customer loyalty, earn repeat business, and charge a premium for their goods and services.

This power (or lack of it) is directly linked to the quality of millions of daily choices made by employees. The bottom line is that a company’s overall excellence is equal to the sum of the total excellence-seeking daily choices delivered by its people.

There is no better way to measure the strength of a company than by the quality of the choices its employees make every day.

The more excellence delivered, the stronger the customer’s commitment and the greater the amount of business and profits generated. The weaker its employees’ commitment to excellence, the weaker its overall performance.

This is a new way to view the power and strength of organisations, and it requires a different way of leading and motivating people in order to generate daily choices for excellence and exceeding customer expectations.

This bottom-up organisational definition runs contrary to the way most organisations define themselves today. A top-down organisation views its power, strength and brand as an abstract entity, loosely connected to its people. The employees are subservient to the larger organisational definition. According to this line of thinking, even if all the employees leave the organisation, the brand will remain strong; the brand makes the people and not the other way around. In a bottom-up organisation, the organisation is defined by the character and performance of its employees.

The people in the company make the organisation what it is. They are the one creating the assets of the organisation. Although some management and marketing theories claim to have an organisation based on assets other than employees such as brand strength and reputation, those assets are dependent on employees and their choices for excellence. Missing one excellence-oriented employee will make the company weaker. Poor performance by just one employee will make the company weaker. The company does not exist without the people who, through their daily choices, breathe life into the company’s mission statement, values, objectives, strategy and overall definition.

One employee at a time, one daily choice at a time, a company’s strength is actually created. This company’s definition is not an event or a milestone that, once achieved, always remains valid. It is, rather, an ongoing process that can reach new heights (or lows) depending on the daily choices made by employees. The company’s success is not measured by some annual study of corporate brand strength, but by the daily performances of the individuals who are the company. Most companies declare their total commitment to their employees and tout their initiatives to promote employee welfare on the pages of their glossy annual report, while relatively few companies truly understand what it means to treat employees as your most important asset."