Sunday, 15 December 2013

Top Tips From Around The World For Managing Customer Experience Excellence

As an exercise to round off what has been an excellent year for The International Customer Service Institute I thought it would be an interesting exercise to see just how many “ Top Tips” on service excellence are available on the web. In their full text format there are over 30 full pages of advice which are summarised below and sorted into their key relevance in the 5 P’s Model. It comes as no surprise that the main categories are People and Process (68%) as research shows that service failure complaints are generated in a similar percentage to those categories. What is more interesting is that almost 30% of the advice relates to Policy  which is primarily the responsibility of those who lead and manage the business so is perhaps that the importance of effectively managing the customer experience as a key organisational fundamental is still not getting through to the top levels. Behavioural Skills and Technical skills top the list of advice provided in the People category so it still appears that

“It is what you do AND the way that you do it”

 is still very important with “Listening” as the most mentioned technical skill.

The one line prĂ©cis of each “Tip” is listed below and may be  a useful aide memoire if only to remind you what you already know but had forgotten.
This is where to go for all of the detail on all of these “Top Tips”. The quality of their advice ranges from the blindingly obvious to the slightly obscure but all are worth a read and the top 3 on the list are well worth taking the time to look through.

Final question for 2013

“If you had to give a CEO 5 tips on how to best look after his customers what would they be?”

Answer – If a CEO needed this kind of advice they would not be qualified to hold that position.

Season’s Greetings to everyone to whom it is important and very best wishes to all for a successful 2014 achieved through the excellence of your customer experience management.

Philip Forrest

Saturday, 23 November 2013

Policies on Policies

Is "clever" marketing in the insurance sector building a legacy of customer dissatisfaction with their new business and renewal strategies?

It seems that the online insurance industry is so desperately driven by the new business disease that their endeavours to feed the insatiable hunger for new premium income is  seen by many customers as nothing short of a con when it comes to the first renewal.
Customers are encouraged by media pundits and comparison websites to shop around, and millions do, and are often rewarded for their efforts by a reasonable saving on the cost of their policy. However after a claim free year are shocked by the size of the renewal premium requested from their insurer and so search the web again and inevitably find another lower cost option. Some just move on to a new supplier others go back to their  original insurer and give them a  second chance and often, lo and behold, find the lower quote can be matched. It may be an old fashioned view point but isn't such an action at best a con and at worst downright dishonest sharp practice?  As if to imply  "Now we have lured them in let's see what we can get away with!'

It also appears the "clever" new business fanatics are also confusing themselves as well as their customers with their propositions through different supply channels.  A report from a Saga Insurance customer, a business specialising in products for mature customers, was shocked by his renewal premium so searched on line and found a much cheaper quote from, wait for it, Saga Insurance! He rang them to be told that the quote was only available via internet sites, so he lapsed his renewal with Saga and reinsured with them via the internet! 

How does that make any sense as either a commercial or customer experience proposition? I can recall when my company did business with our clients in the insurance sector they calculated the cost of new customer acquisition meant that profit was unlikely until year two's renewals had been made. Have things changed to the degree that the industry can afford every policy to have a life expectancy of only one year? Is the game simply to get as many customers as possible regardless of quality rather than to get and more importantly to keep loyal the number of the right kind of customers to support the organisation’s growth agenda?

But what effect is this having on the market overall? Is it not reducing insurance from a service to a commodity where product and service differentiation is imperceptible and price is the key driver of customer behaviour? Some may argue why not, after all grain, cement and coal et al are still traded on that basis but these traditional commodities are much more homogenous and rarely touch the individual lives of individual customers in the way that insurance does and must.  

So what of the experience of the customer and the effect of these policy policies on customer loyalty?

The impact of technology in the form of the internet and price/performance comparison websites has undoubtedly moved the balance of power towards the customer who is now able to research their options to a far greater extent and with much greater ease than ever before. Is the gamble that the insurance sector is making based on a cynical view that once a customer is lured in true loyalty will be replaced by renewal inertia by enough customers to make the equation work?  It is well researched that of the 5 P’s of service quality management “Policy” is the one in which it is the most difficult to recover from a customer service failure. So is the strategy of “Buy them in and bash them at renewal” creating a sour customer renewal experience and breeding a customer culture whose first instinct is not to renew with their existing insurer but always to look for a lower cost? If so what does this mean in the long term for the insurance sector?
Philip Forrest

Thursday, 31 October 2013

Could their Experience Have Been Better?

There are a couple of incidents that have been recently reported  to me that made me ask  the question “What could have been done better”

A group of foreign visiting golfers were playing at The Molle Golf Club in Sweden, the weather had been wet but on the day it could not have been better with a cool bright start turning into a lovely sunny day.

The visitors all hired trolleys which were the new three wheeled push type. The course is spectacular but a little hilly and after a few holes one of the golfers was feeling warm and removed his sweater, which happened to be pale blue cashmere, and placed it in a small basket situated below the push handle.

A couple of holes later in order to get to the next tee it was necessary to push the trolley up a very steep slope, as the golfer did this a large quantity of filthy black liquid came out of the joint in the handle and poured over the sweater leaving it badly marked and stained.

On getting back to the pro shop, the golfer complained and showed them the sweater. The assistant said that

a.     They were aware that the trolley frame was liable to fill with water when it rained and create an unpleasant residue which could spill out

b.     They told the golfer that he should not have put his sweater in the basket

The golfer asked what they proposed to do about the situation.
They advised him they would attempt to wash the sweater. He pointed out that they had to leave after the game to get to their next destination 3 hours away.  The answer was a shrug.
What could they have done better?  If you were in charge of the pro-shop what would you have done?  Is a visitor customer any less important? What were the lost opportunities? Will their action prevent a recurrence?
In another incident a group of eight friends were staying at a country hotel on the East Coast of Suffolk in the UK.  After returning to the hotel from a local visit they were asked if they would like to book a table for dinner. As the restaurant had a good reputation they confirmed they would and were asked what time they would like and they selected 8pm. They arrived at the restaurant to find it almost full with a large group of over 20 behaving in a fairly loud manner with the one waiter and waitress clearly struggling to keep up with their needs.
 It took half an hour before the orders for starters were taken from the group of eight and their whole meal took over three hours to serve as the large group clearly was taking precedence. A couple of very measured complaints to the waiting staff during that period produced no results.
 The following morning on check out the manageress enquired if everything had been satisfactory, she was given the bad news by one of the guests in the form of some carefully structured feedback about the service at dinner. Her response was that she had no idea it had happened, apologised and added she hoped it would not influence their decision about staying with them again. . Nothing more.
There seem to be some process management  and communication opportunities lost here
What could they have done better?  If you were in the hotel owner would you be confident that you would get to know about such incidents?  What were the missed process management and communication opportunities. What could be done to prevent a recurrence?
To conclude another thought.  I have just been reading another book on managing the customer experience and observed that this book, like many of its kind, make a number of references of the kind that say “When you next have to persuade your boss that it is worth investing in customer ……………..then show him this or tell him that”
This seems to imply two things. Firstly that the book is not written for business leaders but is aimed at middle management in order to arm them in their relentless struggle for customer experience improvement in an environment that is hostile to the concept. Secondly that all bosses are unable to read such books themselves and are too stupid and over focused on other priorities to be able to recognise the importance of the role of customers in their organisational success equation.
Could it be that all bosses are that stupid or is that the authors have an unrealistic picture of the world?

Philip Forrest

Saturday, 12 October 2013

Loyalty as a Sales Growth Tool

Why is growth necessary for business survival.?

 It is one of the great business truths that it is very difficult, probably impossible, to maintain a business revenues and costs at a constant level. There is always erosion of revenues that is rarely mirrored by a reduction in costs. So standing still is not an option unless oblivion is part of the plan.

The erosion of revenues is caused by a variety of reasons, one of them being the loss of customers or low customer loyalty. I recently came across again a piece of old research about why customers defect from an organisation which, whether absolutely correct or not, brings into focus the hard edged commercial value of loyalty.
- 1%   Die
- 4%   Move Away
- 5%   Friendship Links
- 10%   Competitor Activities
- 12% Product  Dissatisfaction
- 68% Indifferent Service Performance

These can be subdivided generally into two groups .
Uncontrollable Customer Loss and Controllable Customer Loss.
The first 4 factors (20% ) are more or less uncontrollable. Those that die definitely will not buy much in the future and the others are difficult to manage on a strategic basis. This indicates that an organisation with a customer churn of 20% is likely to have to replace 4% of its revenue simply to maintain the status quo. However. if it does not pay attention to the Controllable Factors (80%) then another 16% of its revenue is at risk and at that rate it is not difficult to see how rapidly oblivion could arrive. Yet it is very rare to find an organisation whose sales or growth plan includes an element that addresses the controllable loss issue. The sales focus usually is very heavily on new business, new sales to new customers. Whereas repeat/additional sales to existing customers (loyalty) figures less prominently.  So if the major strategic growth plan abandons the controllable 16%  of revenue that is at risk by not addressing its root cause, poor product and service performance, and sets sales off to replace the whole 20% necessary to get the revenue level required to stand still is this the most sensible approach? 
If the controllable losses could be entirely eliminated the same sales effort and energy would produce 16% revenue growth, or alternatively the sales costs required to maintain the status quo could be reduced. There is of course a cost to resolving the controllable loss issue but that is usually more of an investment in improved product, premises, process and people performance which when done remains a permanent on-going performance improvement and competitive benefit to the organisation likely to yield protection from controllable losses in the future
Depending on the sector in question It is possible to produce simple or very complicated mathematical models to justify an investment  in loyalty as a sensible business strategy to substantially reduce the sales effort required to achieve a given growth objective.
Many markets are still in uncertain economic times so would it be better to resolve the loss of revenue caused by poor service performance and thereby enable the organisation to focus its sales effort on getting the number and kind of customers it needs to achieve it growth objectives  rather than having to chase the need to get as many customers as it can simply to replace lost revenue?
Many organisations manage sales and loyalty within different functions which  raises the question that if growth optimisation is dependent on maximising the combined effect of loyalty and sales are organisations structured in a way that gives them the best opportunity to grow revenue?

Philip Forrest


Thursday, 29 August 2013

Signs of Satisfaction!

The “Premises” category is one of the 5 P’s in The International Customer Service Standard that The International Customer Service Institute offers to organisations on a worldwide basis. Within that category is a section regarding signage. I am sometimes asked both how Premises generally affect customer service quality and specifically about the role of signs. Setting aside the need to manage potential liability in a world ever becoming  increasingly litigious from the all-pervading influence of health and safety, the role of signs is to help customers optimise the usefulness of their interface with the organisation. Good signs should communicate to customers to either:-






Clarify or


with information that helps them have a satisfactory experience.

Seems simple enough, or is it?

The following examples may, in an amusing way, illustrate that not everyone gets it right every time.

Good Direction?

Stupid but Honest

You Have Been Warned!

Frankly Bizarre

Refreshingly Different

The Last Word In Customer Choice?

The serious question to ask yourself when producing a sign for your customers is whether or not it clearly communicates what you want your customers to know.

So do all the signs in your organisation make sense, if they don’t we would love to see them before you change them.
Philip Forrest

Wednesday, 24 July 2013

Male of Female - Who Delivers The Best Service Quality?

Over the past year a number of high profile women chief executives in the services sector have been asked or forced to resign on the grounds that the organisations which they lead failed to deliver the necessary standards of service to their customers. Some desk research did not uncover a similar pattern among male CEO’s, although plenty of them have been forced to resign for other reasons particularly in the financial services sector. This raised the question about whether men or women deliver the best service quality and at what level? The most interesting fact to emerge so far is that a straw poll among a relatively small sample of academics and business specialists was mystifyingly inconclusive – “ Why would I ask such a question?” and a search on the internet produced no published work on the topic. Given that the comparison between the relative performance of men and women appears to be debated in most other areas it is curious that this should be a factual vacuum.

So is it an irrelevant issue and is the group of high profile female failures a coincidence or are their other reasons? Could it be that women have had to struggle with all of the other leadership issues, like vision, culture, finance, process, politics reach the top in a largely male dominated environment that they have taken their eyes off the raison d’etre of their organisations, service quality? Service quality is a leadership issue so has the poor performance of their organisations been simply that their lack of focus did not identify it as a priority and is that a failing that can be solely attributed to being female or not?

And what of other levels of performance?  Do female managers do a better job than their male counterparts in managing service quality? Are there instinctive qualities that they exhibit in managing the customer experience which make them more naturally suited to such roles? In a white paper which I wrote a few years ago based on interviews with highly successful women they felt that they had higher natural levels of empathy when dealing with customers and staff and that factor had been a valuable contributor to their success.

 Are female staff better at delivering higher standards of quality at the operational level? The straw poll I conducted suggested that the answer to that question was highly dependent on the product or service in question and hinted that men probably did better in the more technical product/service areas. From my own experience I have had outstandingly high levels of service from female staff in both the motor industry and telecommunications sector and appallingly bad service from their male counterparts in the same sectors with the converse being the case in financial services.

So is there a gender performance issue here or not?  Circumstantially nobody I have asked, beyond the instinctive emotional response,  has a clear opinion and is quick to identify a range of qualifying factors before giving an answer?

Or is it an area worthy of some professional research which may uncover data that could create significant competitive advantage in some sectors or at some levels of management? If so would such outcomes encounter an implementation barrier by breaching equal opportunity legislation?

Philip Forrest

Monday, 24 June 2013

The Same or Different?

I happened to be in Istanbul during the recent protest events which raised an interesting service quality question.
Are there any parallels to be drawn or transferable skills to be learned from comparing Citizen Service provided by governments and Customer Service provided by private sector organisations?
It is not a simple question, especially in this case where a government was elected democratically with a very clear majority and as in most democracies was voted into power on the back of a manifesto which outlines their “proposition” to their customers, the citizens.  So does that power create responsibility to honour the specific detail of the proposition or does it create the freedom for the government to deliver services in a way that it interprets as best to suits any given situation?

A commercial organisation makes “propositions” to its customers who are able to test the organisation’s ability to deliver on such promises by becoming customers and acquiring the proposed goods and services in exchange for payment, usually in the form of money. If the company fails to deliver its customers have the ability to complain or “protest” and if the protest is unsuccessful then customers can, (unless it is a monopoly) take their custom and their money away from that organisation and go to a competitor.  A company which fails to listen to such protests from a significant proportion of its customers is usually on its way to limited growth at best and failure at worst. Also in the commercial world it is highly unusual for customers to protest as a group, except perhaps in the legal arena of class actions.

In the case of governments, the case is different. Government is by its very nature a monopoly, if a government fails to deliver on its proposition, or embarks on a course of action which was not in its manifesto and is not expected by its citizen customers, then its citizens can complain (and can in some cases even take the government to court, but not everywhere). If the complaints are unheeded, or deliberately ignored then citizen customers can and do join together to complain/protest.

The first rule of managing customer service, (or indeed managing any form of criticism,) is to ask the question “Are they right?”, and of so in which area or combination of areas of service quality management has the failure occurred. Is it Policy, Product/Service, Processes, Premises/Environment or People that have led to the failure? Most professional, successful commercial organisations do listen, do analyse the complaints/ protests and recognise the huge value of using that data as a tool to drive improvement.
In the case of a government there is, at one level,  no commercial imperative to either listen or to act in accordance with the perceptions of its citizen customers, there is no need in fact to do anything at all and no sanction for such inertia other than the ballot box at the next election. Governments of all shapes and persuasions can be very good at ignoring their citizen customers. However because a citizen customer has been ignored does it not follow that they have given up and forgotten the issue? If citizen customers, in an attempt to assuage their frustration, choose to come together to complain in the hope that a group of voices will have a better chance of being heard then that is in most democracies, including Turkey, their right. On another level there is a huge commercial imperative if foreign investment, tourism and other international revenue sources are involved and the way a government manages citizen customer complaints may well influence how those investment/revenue customers perceive and react to the situation.
Is the way a government responds, either by listening and engaging in dialogue to explain/negotiate their point of view or by another, perhaps heavier handed, approach  a measure of how they see their duty of service delivery  to any significant group of citizens?  In the case of Turkey, it appears that any failure on the part of the government is not Product, Process, Premises or even People related it appears more to be a function of Policy failure. The policy supporting the government re-action to the initial complaint was not expected by the citizen customers and appears to have taken them by surprise (and it is well known in service quality management that people can take good news and bad news but they do not like surprises).
In the commercial world research indicates that, failure to resolve a policy issue between organisation and customers results in permanent, unrecoverable loss of the customer. Perhaps that is why so much angst and frustration is generated by such issues.
So in answering the question :
Are there any parallels to be drawn or transferable skills to be  learned from comparing Citizen Service provided by governments and Customer Service provided by private sector organisations?
In the commercial world there are a number of data sources available to inform the scope of service delivery policy, e.g. nature of the complaint, deviation from the customer proposition, volume of complaints, impact on revenue, indication of a pending paradigm shift or a deeper area of dissatisfaction, complaints coming from the key target market - all of which can be tested against a robust management model. Is the stumbling block for governments the way in which the monopoly position bestowed upon them by a major electoral majority creates a situation where, like it or not , all citizen customers are their target market so if relationships are not managed carefully in any key sector  then polarised confrontation could become a potential outcome?
What can governments learn from the commercial world?  Perhaps anticipating, listening and responding to complaints in a way which recognises the gap between the citizen customers’ expectations of their proposition and its delivery might be a good start.  Could establishing an early dialogue, which is a key part of effective customer complaint management, to attenuate the potential for confrontation be helpful?  Would a published complaint resolution process be useful?
Many of the more enlightened governments already recognise the concept of citizen service and it is an interesting observation that those leading this field have the continuous development and improvement of citizen service quality high on their policy agendas.  That is a function of clear leadership and as the most powerful and effective form of leadership is conditional upon the identification of a mutually acceptable destination for all involved perhaps that is a lesson for both sides if disagreement descends into confrontation.
What can a commercial organisation learn from a government response, such as the one in Istanbul?
Probably that driving a policy agenda through regardless of customer reaction is a risky strategy with a high potential for customer dissatisfaction and defection. Also that water cannon and tear gas may not the best customer relationship management tools – companies could try them but they are risky and unlikely to build high levels of trust and loyalty – but this should not be mentioned outside this blog in case the international banks adopt it as an exciting new tactic!!
All members of almost every population are both customers and citizens so should they expect to be treated differently depending upon who is delivering the service?

Philip Forrest