How To Improve Customer Service Pdf
Reprint: R1007L The notion that companies must get above and beyond in their customer service activities is so entrenched that managers rarely examine it. But a study of more than 75,000 people interacting with contact-center representatives or using cocky-service channels found that over-the-top efforts make little difference: All customers really want is a simple, quick solution to their problem. The Corporate Executive Board'due south Dixon and colleagues describe five loyalty-building tactics that every visitor should adopt: Reduce the demand for repeat calls by anticipating and dealing with related downstream issues; arm reps to address the emotional side of customer interactions; minimize the demand for customers to switch service channels; elicit and utilise feedback from disgruntled or struggling customers; and focus on trouble solving, not speed. The authors also introduce the Client Try Score and show that information technology is a better predictor of loyalty than customer satisfaction measures or the Internet Promoter Score. And they brand available to readers a related diagnostic tool, the Customer Effort Audit. They conclude that we are reaching a tipping point that may presage the end of the phone as the principal aqueduct for service interactions—and that managers therefore have an opportunity to rebuild their service organizations and put reducing client try firmly at the core, where it belongs.
The Idea in Brief
Conventional wisdom holds that to increase loyalty, companies must "delight" customers by exceeding service expectations. A big-calibration study of contact-center and cocky-service interactions, notwithstanding, finds that what customers really want (but rarely become) is just a satisfactory solution to their service consequence.
Reps should focus on reducing the effort customers must brand. Doing so increases the likelihood that they will return to the visitor, increase the amount they spend there, and speak positively (and not negatively) virtually information technology—in other words, that they'll go more loyal.
To run across customers' expectations, reps should anticipate and head off the need for follow-upward calls, accost the emotional side of interactions, minimize the need for customers to switch service channels, heed to and acquire from disgruntled customers, and focus on trouble solving, non speed.
The idea that companies must "delight" their customers has become and then entrenched that managers rarely examine it. But ask yourself this: How ofttimes does someone patronize a visitor specifically because of its over-the-peak service? You tin probably think of a few examples, such as the traveler who makes a bespeak of returning to a hotel that has a peculiarly attentive staff. Only y'all probably can't come upward with many.
Now ask yourself: How ofttimes do consumers cut companies loose because of terrible service? All the time. They exact revenge on airlines that lose their numberless, cable providers whose technicians continue them waiting, cellular companies whose reps put them on permanent hold, and dry out cleaners who don't sympathize what "blitz society" means.
Consumers' impulse to punish bad service—at least more than readily than to reward delightful service—plays out dramatically in both phone-based and self-service interactions, which are most companies' largest client service channels. In those settings, our research shows, loyalty has a lot more to practise with how well companies deliver on their basic, even plain-vanilla promises than on how dazzling the service feel might be. Withal most companies have failed to realize this and pay dearly in terms of wasted investments and lost customers.
To examine the links betwixt customer service and loyalty, the Customer Contact Council, a partitioning of the Corporate Executive Board, conducted a study of more than than 75,000 people who had interacted over the phone with contact-center representatives or through cocky-service channels such as the spider web, vocalism prompts, chat, and e-mail. We besides held hundreds of structured interviews with customer service leaders and their functional counterparts in large companies throughout the world. (For more than item, see the sidebar "Nearly the Inquiry.") Our research addressed 3 questions:
- How important is customer service to loyalty?
- Which customer service activities increase loyalty, and which don't?
- Can companies increase loyalty without raising their customer service operating costs?
2 critical findings emerged that should impact every company's client service strategy. Get-go, delighting customers doesn't build loyalty; reducing their try—the work they must do to go their problem solved—does. 2d, acting deliberately on this insight tin can help meliorate customer service, reduce customer service costs, and subtract customer churn.
Trying Besides Hard
According to conventional wisdom, customers are more loyal to firms that go above and beyond. But our enquiry shows that exceeding their expectations during service interactions (for case, past offer a refund, a free production, or a gratuitous service such equally expedited aircraft) makes customers but marginally more loyal than but coming together their needs.
For leaders who cut their teeth in the service department, this is an alarming finding. What contact center doesn't accept a wall plastered with messages and east-mails from customers praising the extra work that service reps went to on their behalf? Indeed, 89 of the 100 client service heads we surveyed said that their main strategy is to exceed expectations. But despite these Herculean—and costly—efforts, 84% of customers told usa that their expectations had not been exceeded during their most contempo interaction.
One reason for the focus on exceeding expectations is that fully eighty% of customer service organizations use customer satisfaction (CSAT) scores as the primary metric for gauging the customer's experience. And managers often assume that the more satisfied customers are, the more loyal they will be. But, similar others before the states (most notably Fred Reichheld), we discover little human relationship between satisfaction and loyalty. Xx percent of the "satisfied" customers in our study said they intended to leave the visitor in question; 28% of the "dissatisfied" customers intended to stay.
The picture gets bleaker however. Although customer service can practice lilliputian to increase loyalty, it can (and typically does) do a neat deal to undermine information technology. Customers are iv times more likely to leave a service interaction disloyal than loyal.
Another way to call back about the sources of customer loyalty is to imagine two pies—1 containing things that bulldoze loyalty and the other containing things that drive disloyalty. The loyalty pie consists largely of slices such as product quality and brand; the slice for service is quite small-scale. Simply service accounts for well-nigh of the disloyalty pie. We buy from a visitor because it delivers quality products, corking value, or a compelling brand. We get out one, more often than non, considering it fails to evangelize on customer service.
Brand It Easy
Let'south return to the fundamental implication of our research: When it comes to service, companies create loyal customers primarily by helping them solve their problems quickly and hands. Armed with this agreement, we can fundamentally change the accent of customer service interactions. Framing the service claiming in terms of making information technology easy for the customer can be highly illuminating, fifty-fifty liberating, specially for companies that have been struggling to delight. Telling frontline reps to exceed customers' expectations is apt to yield confusion, wasted time and effort, and costly giveaways. Telling them to "arrive easy" gives them a solid foundation for activity.
Telling reps to exceed customers' expectations is apt to yield defoliation, wasted time and effort, and plush giveaways.
What exactly does "make it easy" mean? Just: Remove obstacles. We identified several recurring complaints about service interactions, including 3 that focus specifically on client effort. Customers resent having to contact the visitor repeatedly (or be transferred) to become an issue resolved, having to repeat information, and having to switch from i service aqueduct to another (for instance, needing to telephone call after trying unsuccessfully to solve a problem through the website). Well over half the customers we surveyed reported encountering difficulties of this sort. Companies tin can reduce these types of effort and measure the effects with a new metric, the Customer Endeavour Score (CES), which assigns ratings from 1 to 5, with five representing very high effort. (For details, see the sidebar "Introducing the Customer Try Score.")
We evaluated the predictive power of three metrics—customer satisfaction (CSAT), the Net Promoter Score (NPS), and a new metric nosotros adult, the Customer Try Score (CES)—on client loyalty, divers equally customers' intention to go along doing business with the company, increase the amount they spend, or spread positive (and not negative) word of mouth. Not surprisingly, CSAT was a poor predictor. NPS proved better (and has been shown to exist a powerful gauge at the visitor level). CES outperformed both in client service interactions.
CES is measured by asking a single question: "How much effort did you personally have to put forth to handle your request?" It is scored on a calibration from 1 (very depression effort) to 5 (very loftier endeavor). Customer service organizations tin use CES, along with operational measurements of such things as echo calls, transfers, and channel switching, to conduct an "effort inspect" and improve areas where customers are expending undue energy. Many of the companies nosotros work with apply CES to intervene with customers at risk of defecting.
We found the predictive ability of CES to be potent indeed. Of the customers who reported low endeavor, 94% expressed an intention to repurchase, and 88% said they would increment their spending. Only 1% said they would speak negatively about the company. Conversely, 81% of the customers who had a hard time solving their problems reported an intention to spread negative word of rima oris.
We believe that the superior functioning of CES in the service environment derives from two factors: its power to capture customer impressions at the transactional level (as opposed to NPS, which captures more-holistic impressions of a company) and its ability to capture negative experiences as well as positive ones.
A related diagnostic tool, the Client Effort Audit, can be downloaded at http://www.executiveboard.com/salesandmarketing/CCC-CustomerEffortAudit.html.
During our study, we saw many companies that had successfully implemented low-client-effort approaches to service. Following are five of the tactics they used—tactics that every company should adopt.
1. Don't just resolve the current outcome—head off the next one.
By far the biggest cause of excessive customer effort is the need to remember. Many companies believe they're performing well in this regard, because they have strong first-contact-resolution (FCR) scores. (Come across the sidebar "What Should Yous Measure?") Yet, 22% of repeat calls involve downstream issues related to the problem that prompted the original telephone call, even if that problem itself was fairly addressed the offset fourth dimension around. Although companies are well equipped to anticipate and "forward-resolve" these problems, they rarely practice then, generally because they're overly focused on managing telephone call fourth dimension. They need to realize that customers guess the attempt they expend non just in terms of how an individual call is handled merely also according to how the company manages evolving service events, such as taking out a mortgage or setting up cable service, that typically crave several calls.
Bell Canada met this challenge by mining its customer interaction information to understand the relationships amongst various client problems. Using what it learned most "result clusters," Bell began preparation its reps not only to resolve the customer's primary issue but too to anticipate and address common downstream issues. For instance, a loftier per centum of customers who ordered a particular characteristic called back for instructions on using it. The company's service reps at present requite a quick tutorial to customers well-nigh central aspects of the feature before hanging upwardly. This sort of forward resolution enabled Bell to reduce its "calls per event" by 16% and its customer churn by 6%. For complex downstream issues that would take excessive time to accost in the initial call, the company sends follow-up east-mails—for case, explaining how to interpret the first billing statement. Bong Canada is currently weaving this effect-prediction approach into the call-routing feel for the client.
Fidelity uses a similar concept on its self-service website, offering "suggested side by side steps" to customers executing sure transactions. Often customers who change their accost online call later to order new checks or inquire nigh homeowners' or renters' insurance; therefore, Fidelity directs them to these topics before they get out the site. Twenty-v per centum of all cocky-service transactions on Fidelity'southward website are now generated by similar "adjacent issue" prompts, and calls per household have dropped past v% since the policy began.
two. Arm reps to address the emotional side of client interactions.
Twenty-four percent of the echo calls in our study stemmed from emotional disconnects betwixt customers and reps—situations in which, for instance, the client didn't trust the rep's information or didn't like the answer given and had the impression that the rep was but hiding behind general company policy. With some bones educational activity, reps can eliminate many interpersonal issues and thereby reduce repeat calls.
One U.k.-based mortgage company teaches its reps how to mind for clues to a customer's personality type. They chop-chop assess whether they are talking to a "controller," a "thinker," a "feeler," or an "entertainer," and tailor their responses accordingly, offer the customer the balance of particular and speed advisable for the personality type diagnosed. This strategy has reduced repeat calls by a remarkable forty%.
I company teaches its reps how to heed for clues to a customer's personality type and tailor their responses accordingly.
The lighting company Osram Sylvania sifts through its call transcripts to pinpoint words that tend to trigger negative reactions and bulldoze repeat calls—words like "can't," "won't," and "don't"—and coaches its reps on alternate phrasing. Instead of saying "We don't have that item in stock," a rep might explicate, "We'll have stock availability for that detail in two weeks." Through such elementary changes in linguistic communication, Osram Sylvania has lowered its Customer Try Score from two.8 to 2.2—18.5% below the boilerplate we see for B2B companies.
LoyaltyOne, the operator of the AIR MILES advantage program, teaches reps to probe for information they can use to better position potentially disappointing outcomes. A rep dealing with a customer who wants to redeem miles for an unavailable flight might learn that the caller is traveling to an important business coming together and use this fact to put a positive spin on the demand to book a different flight. The rep might say, "Information technology sounds like this is something you lot can't be late for. The Monday morning flight isn't available, but with potential delays, you'd exist cutting it close anyhow. I'd recommend a Lord's day evening flight so that you don't hazard missing your meeting." This strategy has resulted in an 11% decrease in repeat contacts.
three. Minimize channel switching by increasing cocky-service channel "stickiness."
Many companies ask, "How tin nosotros get our customers to become to our self-service website?" Our research shows that in fact many customers have already been there: L-7 percent of entering calls came from customers who went to the website starting time. Despite their want to have customers turn to the web, companies tend to resist making improvements to their sites, bold that only heavy spending and technology upgrades will induce customers to stay there. (And even when costly upgrades are made, they often prove counterproductive, considering companies tend to add together complicated and confusing features in an effort to keep up with their competitors.)
Customers may become overwhelmed by the profusion of cocky-service channels—interactive voice response, websites, eastward-postal service, chat, online support communities, social media such equally Facebook and Twitter, and and so on—and often lack the ability to make the best choice for themselves. For example, technically unsophisticated users, left to their own devices, may go to highly technical online back up communities. As a effect, customers may expend a lot of endeavour bouncing between channels, only to pick up the phone in the terminate.
Cisco Consumer Products now guides customers to the aqueduct it determines volition conform them best, on the basis of segment-specific hypotheses generated past the company's customer experience team. Language on the site'southward home folio nudges engineering gurus toward the online support community; those with less technical expertise are steered toward knowledge articles by the promise of simple stride-by-stride instructions. The company eliminated the email option, having constitute that it didn't reliably reduce client effort. (Our enquiry shows that ii.4 e-mails, on average, are needed to resolve an consequence, compared with one.7 calls.) When Cisco Consumer Products began this program, in 2006, only 30% of its customer contacts were handled through self-service; the figure today is 84%, and the volume of calls has dropped accordingly.
Travelocity reduced client endeavour just by improving the assistance department of its website. It had learned that many customers who sought solutions there were stymied and resorted to the phone. By eliminating jargon, simplifying the layout, and otherwise improving readability, the company doubled the use of its "pinnacle searches" and decreased calls past 5%.
4. Apply feedback from disgruntled or struggling customers to reduce customer effort.
Many companies conduct postcall surveys to measure internal operation; however, they may neglect to utilize the data they collect to learn from unhappy customers. But consider National Australia Group's approach. The company has frontline reps specifically trained to telephone call customers who accept given it depression marks. The reps focus first on resolving the customers' issues, merely they also collect feedback that informs service improvements. The company's result-resolution rate has risen past 31%.
Such learning and intervention isn't express to the phone channel. Some companies monitor online behavior in guild to place customers who are struggling. EarthLink has a dedicated squad of reps who step in every bit needed with clients on its self-service website—for example, by initiating a chat with a client who has spent more than 90 seconds in the noesis center or clicked on the "Contact U.s.a." link. This program has reduced calls past viii%.
five. Empower the front line to deliver a depression-try experience.
Incentive systems that value speed over quality may pose the unmarried greatest barrier to reducing client try. Most client service organizations still emphasize productivity metrics such as average handle time when assessing rep operation. They would be ameliorate off removing the productivity "governors" that go in the mode of making the customer's experience piece of cake.
An Australian telecommunication provider eliminated all productivity metrics from its frontline reps' performance scorecards. Although handle time increased slightly, repeat calls fell by 58%. Today the company evaluates its reps solely on the footing of short, straight interviews with customers, substantially asking them if the service they received met their needs.
Freed to focus on reducing customer endeavour, frontline reps can easily selection low-hanging fruit. Ameriprise Financial, for instance, asks its customer service reps to capture every instance in which they are forced to tell a client no. While auditing the "no's," the company found many legacy policies that had been outmoded past regulatory changes or system or process improvements. During its start year of "capturing the no'southward," Ameriprise modified or eliminated 26 policies. Information technology has since expanded the program by request frontline reps to come up upward with other process efficiencies, generating $1.two million in savings every bit a result.
Some companies have gone fifty-fifty further, making low client effort the cornerstone of their service value proposition and branding. South Africa's Nedbank, for instance, instituted an "AskOnce" promise, which guarantees that the rep who picks upward the phone volition ain the client'south result from offset to stop.
The immediate mission is clear: Corporate leaders must focus their service organizations on mitigating disloyalty by reducing customer effort. Only service managers fretting about how to reengineer their contact centers—departments built on a foundation of delighting the customer—should consider this: A massive shift is nether mode in terms of customers' service preferences. Although most companies believe that customers overwhelmingly adopt alive phone service to self-service, our most contempo information show that customers are, in fact, indifferent. This is an important tipping point and probably presages the finish of phone-based service as the primary channel for client service interactions. For enterprising service managers, it presents an opportunity to rebuild their organizations effectually cocky-service and, in the process, to put reducing customer effort firmly at the cadre, where it belongs.
A version of this article appeared in the July–August 2010 issue of Harvard Business Review.
How To Improve Customer Service Pdf,
Source: https://hbr.org/2010/07/stop-trying-to-delight-your-customers
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