The Definition of Customer Service - Customer Relationship Management

First,let’s decide what we’re talking about when we say customer service in the context of Social CRM. It is the customer care activities that surround the purchase of a product or services. That is an aggregate definition that pretty well encompasses the average and median definition of customer service,derived from several dozen.

This definition extends customer service to something well beyond just handling complaints. It also includes,for example,inquiries and questions that require a non-urgent answer,but are still expected to be answered on the first contact.

But even just this example can get dicey when you have to figure out who carries out this function and what channels are used for it in a company.

For example,is field service part of customer service? Is the call center the primary way that customer care should be carried out? For the purposes of the fourth edition,field service is not going to be covered—please see the third edition if you want to a detailed and still appropriate look at field service. But we are going to look at the state of the call center to see how (and if) it fits into a contemporary customer care strategy.

The Contact Center:The Illusion of Successful Efficiency
John Ragsdale,who is the vice president of technology research at the Service and Support Professionals Association (SSPA),did a study on service technology spend between 2008 and 2009 and found that there was one big winner and one big loser. The big winner was multichannel and e-services,which went from 22 percent in 2008 to 30 percent in 2009 of all service tech budgets. The big loser? Contact centers,which dropped from 39 percent to 27 percent in those two years—and pretty well funded all the increases in other categories.

Why? Because it is increasingly apparent that not only are alternate service channels becoming a more important part of service execution strategies,but customers would rather rely on themselves than a CSR,given the level of frustration and the expectation of failure they already have for that traditional environment. That doesn’t mean they don’t want to talk to someone. They just don’t trust that the “someone” will solve their problem.

You can’t blame this shift—if blame is the right word—on the empowerment of customers,their Internet savvy,and their desire to resolve their own problems on their own time. It is a strong factor in this move toward multichannel customer service. But equally important is the failure of contact centers to recognize that the processes they use,their sadly misaligned cultures,and the metrics they measure by are part of why customers don’t expect to get their problems solved despite their calls. It’s an institutional failure. In 2008,Forrester Research queried 5,000 respondents and released a report called “Why Talking to Customers Is Ruining Your Business,” which outlined why customers felt this way. The primary reasons were:

  • Routing calls to the wrong customer service agent Fiftyseven percent felt that the routing failed to get to the person who could actually solve their particular problem.

  • Horrible knowledge management capabilities Sixty-two percent felt the knowledge bases were average or worse. You know this to be true. How many times have you gone to a knowledge base to find an answer,entered a search phrase,and come up with about 10 answers that had absolutely nothing to do with the search phrase you entered?

  • Poor customer data access Sixty percent felt that agents didn’t have the ability to successfully review the customer records needed to respond to customer queries. This might not be true,but it’s the perception. That’s all that’s needed to reduce trust.

The problem isn’t the problems themselves. The way that call centers are organized and customer service reps are measured militates against successful interactions with customers. Customer service reps are measured by the speed with which they clear the call queues—one way or another. Customers are looking for a resolution to their problem or answer to their question and an experience that at least meets their standards. These are diametrically opposed expectations.

If you look at traditional call center metrics,they include how many calls per hour are answered,how long it takes for a call to be answered (average speed of answer,or ASA),how long a call takes (average handle time,or AHT),how many calls have been abandoned,the mean time to resolve tickets,and so on. These are all KPIs that are aimed at efficiencies in the call center,not the actual solution to the customer’s problem or the answers to their queries. This is the precise difference between a corporate culture and a customer-centric culture. The former tries to resolve things to the satisfaction of management,the latter to the expectations of the customers. The most significant call center metric that aligns with the customers’ actual requirements is first contact resolution,not first call resolution. This is a multichannel world now.

This is an endemic problem spanning multiple industries. Here are a couple of very typical snippets of discussions about call center KPIs that go on in a number of forums:

  • “We are a state government owned utility company. As far as our owner is concerned our only KPI is Grade of Service (70 percent of all calls answered in 30 seconds). To them nothing else counts.” (CallCenterOps.com, 2007)

  • “Total incoming calls; average wait time before call abandonment; abandoned calls; average speed to answer;average calls per agent in an eight-hour shift. . .” (KPIfix.com, 2008)

Efficiency rules. The question is why? According to Natalie Petouhoff,a senior analyst at Forrester Research,who runs their customer service research practice and whom you will hear from quite a bit in this chapter:

Twenty years ago when customer service strategies and the resulting technologies were first adopted,without meaning to,they set customer service up to fail. How? The primary goal was to make the corporation more efficient. Cost-cutting strategies defined customers’ questions and concerns as a nuisance to be dealt with in the most minimal way possible. In response,technology vendors focused on the automation of customer complaints. Businesses then weren’t attuned to concepts like “customer experience” or “customer lifetime value.”

The resulting customer disdain combined with rapid rise in adoption and use of social media by consumers have today formed a “perfect storm” that is driving the change in the world of customer service.

But unfortunately,as Fred Reichheld pointed out in his book The Ultimate Question: Driving Good Profits and True Growth,there is an 80/8 gap. When it comes to customer experience,80 percent of the companies think they are doing a good job,but only 8 percent of the customers think they are. When it comes to call centers,the delusion of success is there,because,as frequently as not,they perform well according to their KPIs. They reduce handle time; they meet the SLA basic terms; they reduce abandonment rates. But they don’t improve the customers’ experience or resolve their issues to the customers’ satisfaction.

Can Traditional Contact Centers Still Work?
The traditional contact center is not going to go away. So the question is,can they work using traditional approaches and efficiency-based metrics? They can,but not without a significant organizational process transformation and cultural change. What that involves is what CRM initiatives always involve.

  • Executive sponsorship and commitment Not only does there have to be cooperation between all the customer-facing and back office departments to make sure that customer service has the data and cooperation they need to deal with customer contact,senior management needs to understand that customer service improvements—including the right training,technology,and the actual interactions with customers—will cost money over time. They need to commit to increased budgets based on improved customer experience,not cut budgets for operational efficiency improvements. The latter are marginal,the former are dramatic.

  • New training fosters new skills It’s no longer a matter of just following agent scripts,though that can help to some degree. Agents need to be able to connect with customers. Aside from product knowledge and technical skills,soft skills need to be equal partners in the training mix. Rosanne D’Ausilio,CEO of Human Technologies Global,did research that proves soft skills training shows “measurable reductions in job stress,improvements in job performance (including benefits such as reduced average call duration),better customer service scores,and reduced turnover.”

  • New metrics combined with old While few are suggesting that all efficiency-based metrics are eliminated,customercentric metrics such as first contact resolution (FCR) need to gain in importance. In 2007,the SQM Group did research on first call (not contact) resolution and found that customer satisfaction drops an average of 15 percent with each customer call past their first. But on the positive side,for every 1 percent improvement in FCR,you get a 1 percent improvement in customer satisfaction. Other customer-centric metrics could include self-service accessibility,which shows not only how many customers begin self-service transactions but complete them.

  • Appropriate use of multichannel and voice technologies It’s no longer about just the use of IVR technologies to increase efficiency by reducing human interactions. There are dozens of other channels,both internal and external,that customers converse on. Judicious use of technologies and allowing the customers to choose which channels they are contacted through can improve the customer experience dramatically.

  • Culture change The agent environment should be changed so that agents are encouraged to listen to customers and initiate discussions,not just up-sell,cross-sell,and answer questions. As a major part of this change,agents should be incentivized to actually be customer-centric,which means their KPIs would include customer comments and thoughts about the individual agents. The idea is for agents to converse with the customers—reactively or proactively—and be accountable for the results.

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