Tag Archives: customer service

Customer Focus by Everyone

There are many critical elements to a management system. One that is fundamental, yet still poorly executed far too often, is creating a system where all staff can focus on enhancing value to the customer every day.

If your enterprise does not focus on this, it should. If you think your enterprise does, my first, second and third suggestions are to think more critically about whether it really does. If the answer is yes, then you are lucky to work in such an organization.

Saying that customers are valued is easy. Actually designing systems to focus on providing value and continually improving to provide value more effectively is not. It really shouldn’t be obvious to a customer in 5 minutes of interacting with your organization that it is obvious customers are not very important.

It is very difficult to create a system with customer focus by all staff without several basic supports in place. Respect for people needs to be practiced – not just mentioned. If there isn’t time to work on improvements to the system, often meaning you have the equivalent of sickness management instead of a “health care system” that is a shame. The reality of most organizations seems to be to make it very annoying for customers to even bring an issue they are having to the attention of the organization and even then the gaol is to use the absolute least amount of effort for the band-aid that can be tolerated.

Staff have to be given authority to act in the interest of customers. But this can lead to chaos if a good system isn’t in place to steer this process. And without processes in place to capture (systemically) needed improvements there will be huge waste.

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Simple Customer Care: Communicate

Some management issues are hard. You are often balancing priorities. Sometimes though it is extremely simple: either you have concern for customers and take actions to back that up or you have some concern but don’t do anything about it.

Here are some examples that show you really just don’t care.

If you have invested millions in setting up computer systems to authorize, and reject, payments for say a credit card and you fail to notify customers when you reject a charge you just really don’t care. There might have been an excuse 10 years ago that it was too difficult to notify people. Today if your IT people can’t do that, hire a new CIO and have them create an IT support system that isn’t an embarrassment to any institution relying on it.

Another sign of an extremely weak IT and customer focus presence in an organization would be deleting records of your customers after 6 month or 1 year or ever. Again this is common among the too-big-to-fail financial institutions that seem much more able to design system to extract fees and justify ludicrous bonuses to executives than to provide the most basic services for customers.

Amazon, and most any non financial-too-big-too-fail institution, keeps your records available for you. The too-big-too-fail crowd though won’t keep records as well as the site you buy books from. They slap fees on customers if they want to get the paper statements they used to get for free. That is fine with me (the fees are far too high, but the concept is fine with me). The too-big-too-fail crowd wants to save money by not mailing you paper. Fine.

Then, deciding to delete your records after 6 months, or a year… is just a sign you have no interest in serving customers. Other than an organization that has no interest in customer service, suggesting such a thing would be a direct ticket to remedial training on providing value to customers.

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The Customer is the Purpose of Our Work

Quote from Gandhi on customer focus at the Chakra restaurant

A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favor by serving him. He is doing us a favor by giving us an opportunity to do so.

Mahatma Gandhi [his authorship of the quote is disputed, and likely it isn’t a quote by him, see comments]

A snapped this photo at the Chakra restaurant in Johor Bahru, Malaysia. Ironically the food is great but the service isn’t what I would like. But I will gladly go back many times. I’d like a bit more attentive service but I love the food and that is more important to me.

I think service at restaurants is one of the tricker things to do well: different customers have different desires. I basically want great food, my water to be filled up and my bill to be given to me before I finish so I don’t have to wait around to pay. But lots of people will find it annoying to get a bill early, feeling that they are being rushed out the door.

Still there is a certain standard I share with lots of people for things like not having to wait around for a long time to get the bill after I am done. Getting water filled up as needed, pleasant decor, etc..

In Johor Bahru there are a fair number of Japanese restaurants (the food is very good and the service is also good). Several of these restaurants have buzzers on your table to press when you want service. I love Indian food. I must say I like the Japanese service (it did take me a bit to warm up the buzzer idea – it is very practical). It do believe some of the things I would see as weaknesses in customer service are partially a cultural difference (it is interesting to see the different customer service experiences at the different restaurants here).

The quote from Gandhi is great. “He is the purpose of it” is something we would all benefit from taking to heart. To do so, I think we are wise look at how we can better meet customer desires every day.

Be Thankful for Customer That Are Complaining, They Haven’t Given Up All Hope

I ran across this message and liked it (by wuqi256):

My time spent in a fast food chain (factory worker on weekends and security guard at night, yes really thanks to them, i have great jobs like that) when i was young trying to feed the family and study at the same time was quite useful.

They taught me that “Customers who complain are the best customers, it shows that they have still residual faith and goodwill in the organisation hence we should sift out those frivolous complains from those genuine ones that need our urgent attention” These are people who we can and should do a lot for as a complaining customer still has a very high chance of becoming a “returning” customer.

The customers that we fear for the most are those that either have voiced out or not heard or those who have given up and moved on to another organisation. Those we can no longer do much for as they no longer give us a chance. Discontentment is one thing but find the root cause, remove the straw from the cauldron and the water will stop boiling.

I know I often don’t bother voicing my concerns when I have given up all hope the organization has any interest in customer service. Sadly this is a fairly common situation.

It isn’t easy to do, but organizations that are customer focused need to be taking advantage of those customers helping you by expressing the frustration (that many of your customers experience, but don’t express). To do so organizations need to develop a culture where everyone is encouraged to improve your processes. The tricky part is not claiming that is what you want, but actually creating and maintaining the systems that bring that about.

The Impact of Leadership on Business Outcomes

Joe Folkman

Guest post by Joe Folkman

Have you ever been part of an organization where things were proceeding smoothly, where goals were achieved, people were busy and the organization was doing well? Then, a new leader came and everything suddenly changed for the better. The energy level of employees went up substantially, pride in the organization increased, the effort and dedication of individuals jumped, bold objectives were enthusiastically accepted and even greater results were achieved. The differences were not only measurable by the accountants, but everyone could feel it.

Perhaps you had the opposite experience where things were things were going along smoothly and a new leader was introduced and things quickly began to fall apart. High performers quit, conflicts became more apparent, work seemed much less important and there was no fun. Colleagues skulked into corners, not wanting to be engaged. Overall satisfaction decreased. Grousing and carping criticism of the leaders became rampant. People receiving promotions were chosen because of politics, not performance. Management decisions felt arbitrary and unfair. Results began to slide, and employees became the cause of the problems as much as the economy or market conditions. Key employees were laid off while the remaining people were asked to carry a bigger load. Results continued to decline, and your job felt increasingly harder and you found yourself beginning to think about quitting.

Those who have experienced great leadership or poor leadership have felt the difference. Could these changes have been predicted? Are there clear correlations between the effectiveness of a leader and the success of an organization?

Case Study on the Impact of Leadership on Customer Satisfaction
A large telecommunication company was focused on an effort to improve customer satisfaction ratings. The company wanted to know which factors impacted the customer satisfaction. A group of 81 leaders received 360 feedback from their immediate managers, peers, direct reports and others. The leadership effectiveness of each manager was evaluated by a 49 item assessment. Based on the overall rating from the 49 items, managers were divided into five groups, from leaders at the bottom 10th percentile (the worst leaders) to those at the top 10% (the best leaders).

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Rude Behavior Costs Companies

Approximately one-third of consumers surveyed reported they’re treated rudely by an employee on an average of once a month and that these and other episodes of uncivil worker behavior make them less likely to patronize those businesses.

Customers rarely report such behavior to employee supervisors, and management systems are so poor they don’t deal with this problem (good systems will – Trader Joe’s or Crutchfield, for example) ensuring a relentless cycle of poor employee behavior that leaves consumers angry and frustrated and saps businesses of customer loyalty, return business and profits, according to researchers from the University of Southern California and Georgetown University. Having tried many times to report failures in their systems to organizations I can say I am either treated with we have no way to accept your feedback or obvious disinterest.

Even, long after Brian Joiner told me he stopped wasting his time for most companies as they obviously had no interest in improving systems to avoid customer hardship I keep banging my head against a wall. It is very rarely that I don’t get complete disinterest. About the best is “you are so right, this is a problem I have to deal with all the time, I have told ‘them’ about the problem but nothing ever happens, I’ll pass on your comment.” It is no surprise people don’t bother to point out problems.

A majority of the respondents went home and told friends and family members about the incident (and connected customers often speak out online to large audiences about bad customer service). Managers are unable to address the issue with employees if the managers don’t have a grasp on what is going on at the gemba. The study found that witnessing employee incivility makes customers angry. Customers are less likely to repurchase from the firm and express less interest in learning about the firm’s new services. For managers who are made aware of the offending behavior, their own harsh treatment of the employee can also prompt negative reactions from consumers.

“Regardless of the perpetrator or the reason, witnessing incivility scalds customer relationships and depletes the bottom line,” report the co-authors, Georgetown University Assistant Professor of Management Christine Porath and USC Professors of Business Administration and Marketing Debbie MacInnis and Valerie S. Folkes.

The best response is a simple apology, which researchers found was a just and proper response from both the employee and the supervisor. Of course, you should also address any other issue the customer has. Once you mistreat people they often are much more sensitive to things that they would have accepted otherwise. So I believe you would be wise to apologize and ask if there is anything you can help them with. Leave them with a positive, rather than just apologizing for the negative. It would be best to avoid the problems in the first place. Training programs that foster employee civility in order to prevent harmful outbursts may well be wise.

From the abstract of the paper:
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When Companies Can Treat You Like an ATM, Many Will Do So

The End of Refrigeration

One small custom chip, some relays, a transformer, a couple of heat sinks, and a bunch of passive parts. Maybe a build cost of $20-30 or so? But GE’s price to me was $250, plus $150 for the 20 minutes it took to pull out the old one and swap in the new one.

Paying $400 for a big piece of physical gear plus a couple hours of labor didn’t bother me. Paying $400 for a primitive circuit board and a few minutes to plug it in does.
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Bottom line: $400 because a $2.02 Song Chuan 832 Series 30 A SPDT 12 VDC Through Hole General Purpose Heavy Duty Power Relay burned out.

This is a combination of companies 1) not being customer focused, 2) short term thinking, 3) very ologopolistic markets (very little competition). So when you are looking at this from the view of providing the best system, for in this case refrigeration, it is not a very difficult solution. You would want to minimize loss (have parts last) and in case they don’t minimize replacement cost. You would design the entire system so the parts that do burn out are easily replaceable and cheap and ideally notify you which part is broken (without the need for expensive contractor visits).

However, if your goal is to maximize company profit it is easy to see how you would develop a system that rips off the customer (very expensive part replacement, huge text messaging fees…) and attempts to capitalize on very little competition in the marketplace and customers that cannot reasonable analyze the system to see how they will be penalized by choosing your very expensive to maintain equipment. It is what they seem to teach in business school – take as much advantage of your customers as you can get away with. I prefer the Jeff Bezos school of thinking

There are two kinds of companies, those that work to try to charge more and those that work to charge less

It is a vastly different mentality to try to charge customers less as Amazon does (rather than say the practices of: Verizon, Bank of America, AT&T or Comcast). Your organization has to focused not on your quarterly profit (and if you are think kind of company, probably your personal bonus targets) but in serving your customers well, and in continually improve the value you provide to customers. And the company takes a share of the value just as all other stakeholders do (customer, employees [not just those in the c-suite)], suppliers, society…). Not only do I want to be a customer of this kind of company, I want to be a stockholder.

Delighting Customers

If you have customers that see you as adequate you will keep customers based on inertia.

But you have several big problems awaiting you. Those trying to win your customers business only have to overcome inertia – which can be very low hurdle (saving a small bit of money, some minor additional feature). If your customers are delighted they won’t leave (by and large) without significant reasons to.

Also your attempts to increase price are very likely to lead to increased customer losses (than if customers are delighted). Delighted customers are willing to pay a premium which helps profits enormously (Apple has done this quite well).

Delighted customers will refer others to you – great free marketing.

Satisfied customers leave you very little leeway for error. If you cause satisfied customers some problem (which granted, hopefully you won’t but if you do) they are not likely to be forgiving. If they are delighted they may well stay even if you have a delay, provide less than stellar customer service for some request…

There are many ways to attempt to delight customers. One of the simplest powerful tools is to ask a very simple question: What Could we do Better?

Aligning Marketing Vision and Management

Why do so many companies market one thing and provide something else? I know it might be easier to sell something different than what you offer your customer today. But if you decide to market one vision, why don’t you change your organization to actually offer that?

I suspect this is substantially due to the outsourced nature of large marketing efforts. It makes sense to me that when you outsource your marketing message creation it isn’t tied to your management system and the two silos can pursue their own visions.

I would imagine marketers would claim they “partner” yada yada yada (and sometimes it actual seems to happen, but not often). As a consumer it sure looks to me like companies outsource marketing to ad agencies that come up with marketing plans that are not in harmony with the real company at all. I can understand putting a positive spin on things, but so much marketing is just completely at odds with how the company operates.

Treating a marketing message as something separate from management is a serious problem. When your marketing message says one thing and your customers get something else that is a problem. I think the message is often based on what the executives wish the company was (and the outsourced marketers think it should be), but it isn’t the customer experience the management system provides.

If you believe the vision of your marketing then make sure your organization has embraced those principles. I think, often, companies would be wise to follow the vision their marketers came up with. But instead they tell customers to expect one thing and manage the organization to provide something else. I just don’t see how that is sensible.

Lean Inventories Do Not Excuse Failing to Deliver

Low inventory levels do not mean failing to have products available for customers. Now, if you manufacturing in huge batches and can’t respond to customer feedback then it might mean failure to predict customer demand does mean failure to deliver. But lean thinking has shown how to avoid this problem. People need to adopt lean manufacturing practices and gain the benefits of low inventory levels without the costs of failing to deliver what customers want.

Sorry Santa, We’re Out of Stock

The “it” gifts this year could swiftly vanish from store shelves, as retailers, with nightmares of Christmas 2008 markdowns dancing in their heads, have slashed inventories to some of the leanest levels in recent memory.
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Retailers themselves are battle-scarred by last year’s fourth-quarter fiasco. Following the financial meltdown of September 2008 and amid the most severe economic crisis since The Great Depression, consumers retrenched.

That’s when stores hit the markdown panic button, slashing prices upwards of 75 percent. The result was the worst holiday selling season since 1970, according to The International Council of Shopping Centers.

But although leaner inventory levels should drive profit margin gains this holiday, “retailers might not have enough inventory to fully satisfy demand,” said Citigroup retail analyst Deborah Weinswig, in a research note. It is a risk they are willing to take.

“They would rather lose a sale than take the markdowns they had last year,” said Goldman Sachs analyst Adrianne Shapira.

The retailers need to design their systems with lean thinking in mind (not lean – as in cut expenses without thought). And they need to work with suppliers using lean manufacturing principles.