Customer Service King

Here is just a couple of excerpts from an article by John Gaffney that appeared in 1to1Weekly, T-Mobile, Experian Share Net Promoter Experiences:

It would have been OK if Fred Reichheld, Satmetrix, and everyone else involved with Net Promoter took time to pat themselves on the back at the first annual Net Promoter conference in New York. But no laurels were evident at the conference, and none were rested on. Instead, organizers and panelists answered their own ultimate question -- how is Net Promoter working?

"Creating a customer-centric culture and driving client loyalty is a long-term business strategy, not a quick fix," Laura DeSoto, senior vice president of innovation and synergy at data firm Experian said. "Especially in a B2B environment with complex client relationships, it may take several survey cycles -- a full six to 12 months -- for a client to recognize your headway in delivering an excellent client experience in their survey response. They may not give you 'credit' for your gains until they've seen it consistently over a period of time. At Experian, once we delivered a great client experience consistently, our clients acknowledged this and rewarded us handsomely with a higher Net Promoter score."

Raimund Schmolze, vice president of customer insights at T-Mobile was also candid about his experiences with NetPromoter's limitations. The problems reflected in poor scores are not always simple product or service-related. In Q2 2006 T-Mobile offered a new pricing plan in the EU designed to drive customer acquisition. In the third quarter T-Mobile's NPS dropped. The problem, upon further analysis, was at the call center. New customers coming in from the new pricing model overloaded the call center and led to a downturn in the willingness to recommend.

Dr. Laura Brooks, codeveloper of Net Promoter and vice president of methodology and consulting at conference organizer Satmetrix, explained that discipline is crucial to a successful Net Promoter initiative. The "Net Promoter Discipline" encompasses executive sponsorship within companies, organizational alignment with the executive vision, and system infrastructure for collecting, analyzing, and distributing customer feedback within the organization.

"Our recent research on loyalty best practices has shown a gap between the vision executives articulate for loyalty initiatives and the reality of how successful companies are at driving operational changes and action at the front lines," Brooks said. "Net Promoter offers a solution to this gap, allowing organizations to rally around a powerful and straightforward score that links to customer loyalty and growth. But achieving results requires a disciplined approach that drives customer focus throughout the organization."

Here are several excerpts that I found particularly valuable from the recent Businessweek cover story, Customer Service Champs:

Providing great customer service is much more than just a job for the front lines or the call centers. It takes coordination from the top, bringing together people, management, technology, and processes to put customers' needs first. That's true today more than ever. Technology is leveling the barriers between alpha companies and also-rans, making great customer service one of the few ways companies can distinguish themselves. Retail, online, and phone shopping channels are expanding, increasingly prompting customers to demand a seamless--and painless--experience. Refining time-tested concepts and coming up with cutting-edge ideas is critical for managing rank-and-file workers and measuring what customers think.

In BusinessWeek's first-ever ranking of the best providers of customer service, we set out to find the service champions, but also to dig into the techniques, strategies, and tools they use to make the customer king. To launch the process, we created a list based largely on brands in J.D. Power & Associates' database. In addition, we polled 3,000 of our readers, generating a pool of names most associated with treating customers well. We then asked J.D. Power, which, like BusinessWeek, is owned by The McGraw-Hill Companies, to survey customers about the brands that were nominated by readers but not already in its database.

For most of us, customer service is an aggravating maze of automated phone trees and scripted voices resonating from halfway around the world. But while offshoring call-center work is still growing steadily, companies are getting smarter about what they send overseas. "I think we're seeing some backlash," says Bruce Temkin, Forrester Research Inc.'s principal analyst for customer experience. "Companies are pulling some [more complex types of calls] back from offshore, and in other cases are recognizing they need to invest more in those facilities to give reps more tools and training."

One encouraging alternative trend, at least for those of us on the other end of the phone line, is "homeshoring," in which service agents armed with a broadband line, a computer, and a quiet corner in their spare bedroom respond to calls at their homes. Service can be better for customers because homeshoring attracts more experienced workers with more education than do regular call centers. Stay-at-home moms are a big part of the labor pool and like the flexibility and nonexistent commuting costs of the home-based model. That makes them more loyal, keeping turnover lower and experience levels higher. Companies that outsource calls to home-based agents report turnover rates in the 10% to 30% range, compared with anywhere from 60% to 100% in the average call center.

The connection between satisfied employees and contented customers is hardly a new concept: Any business-school student can recite by heart the concept of the "service-profit chain," which draws the inextricable link between the front line and satisfied customers. But new research from Katzenbach Partners offers an updated metaphor. The firm stresses the importance of an "empathy engine," which looks at the role of the entire organization, including middle and senior management, in providing great service. The firm stresses the importance of an "empathy engine," which looks at the role of the entire organization, including middle and senior management, in providing great service. If that engine is thought of as a heart, "the whole company has to pump the customer through it," says Traci Entel, a principal at Katzenbach Partners who recently studied 13 leading service companies' best practices. "It starts much further back, with how they organize themselves, and how they place value on thinking about the customer."

I was recently interviewed by Sue Hildreth for an article she was writing for TechTarget's SearchSMB.com.  Here is the resulting article, CRM Suites Suit SMBs:

Here are the most interesting CRM-related news stories from the past week:

• New Netsuite Ecommerce Release Brings Integrated On-Demand Suite
• Netsuite Adds Hosted Link to eBay
• RightNow Presents New Voice Technology
• SAP Acquires Pilot Software
• SAP to offer hosted midmarket apps later this year
• PeopleSoft, J.D. Edwards Apps Updated
• BEA Systems Offers New Online-Sales Software
• FrontRange introduces enterprise edition of its Goldmine product
• IBM is going social in a bid to invigorate its Lotus brand
• ADVIZOR Solutions Introduces SalesAdvizor for the AppExchange
• Cabinet NG Release CNG-SAFE Document Management for ACT!
• Endeavor Says SmartCatalog Compliant with Dynamics CRM 3.0
• Colligo Networks Unveils Version 2.0 of Colligo for SharePoint 2007
• Aprimo's Midsection Marketing Muscle
• DealerAdvance Drives Home a Winner at Vegas Auto Show
• CRM and ERP Becoming Mainstream for U.S. Medium Businesses
• Sage launches online accounts software
• FTS Launches Leap BCE Mobile Edition
• Microsoft Launches Vista Migration Tools for Business
• Google Unveils Apps Premier Edition
• Google Apps upgrade threatens Office
• Avaya extends mobile IP client to 500 new devices
• The Battle for Mobile Search
• Google Wizards Conjure Google News Links for Web Sites
• Google Exec: Google Adding Value to Brands
  

Here are several excerpts from a post in BusinessKnowledgeSource.com, The Importance of Repetition in Advertising:

Repetition is an important part of advertising. Why? Because, it is through repetition that you establish your credibility, establish brand familiarity and become the first thought when a need for your type of product or service arises, etc.

Sales start before the person is at the store looking at the product. Look at this little paragraph, it perfectly illustrates the importance of repetition in advertising:

"I don’t know who you are.
I don’t know your company.
I don’t know your company’s product.
I don’t know what your company stands for.
I don’t know your company’s customers.
I don’t know your company’s record.
I don’t know your company’s reputation.
Now – what was it you wanted to sell me?”

Repetition is fundamental to the success of any advertising program. The marketplace proves out this fact, as does scientific research. Science has shown through studies that a person must see your product NINE times before they will feel apathy toward it and be inclined to buy it.

Here is an excerpt from a post by Kathy Sierra in the Creating Passionate Users weblog, What Tail is Wagging the "User Happiness" Dog?:

You can't swing a poodle in business without hitting a tail-wagging-the-dog scenario, where some process, policy, procedure, or program controls user happiness. Where we become slaves to the needs and demands of the IT department, efficiency, accounting, PR, legal, marketing, next-quarter's results, Upper Management, etc.

We've heard all of the justifications and excuses. Worst of all, these decisions are nearly always made by people with the least amount of contact with Actual Employees, let alone Actual Customers. Imagine working at a place where Customer Advocates -- internal evangelists for what users need -- wielded as much power as the IT guy. Where the software developers (and other employees) have the power to use the tools they need to best serve the users, even if it's a pain in the ass for the sys admins. (No offense to sys admins--I'm talking about the misguided and/or too-far-removed-from-customers ones, not the clueful.)

I'm not dissing Six Sigma or IT or Accounting or Production or Policies or Procedures or Process or whatever. I'm just saying we have to be very, very careful about who wags who, especially during that critical phase when a company transitions from a small everyone-does-everything start-up to a bigger company. Users are often best served when everyone from the manager to the developers to the accountants has to spend time on customer service and support. But when that's no longer realistic, we must work hard to make sure that nobody in the company forgets who we all really work for--the users.

We're all guilty of it -- from the big company to the two-person start-up (or the one-person author!) -- and we do need to balance the needs of the company against the needs of the customers, but I'd recommend putting a big picture of a dog in your meeting room, and emphasizing who's the dog, who's the tail, and who wags who.

Bonus link: a wonderful post by Joel Spolsky on customer service! Two thumbs way up.

Here's some interesting news from a post by Chris Boggs, the Editor of Search Marketing Trends that appeared in the SearchEngineWatch.com weblog:

Google Groups recently relaunched with a new look and feel. One of the most popular groups in the search engine optimization community is the Webmaster Help group. This area features literally hundreds of questions about Google's crawling methodologies, as well as Web site design and its relationship to the ability to be indexed in Google. Although not all questions are useful, and responses in any community should be taken with a grain of salt, the best thing that this group has going for it is the actual participation by Google engineers and members of Matt Cutts' team.

So if you have some time to spend asking SEO and other site design questions and looking for answers, Google Groups might be one of the best "forums" out there, due to the increased chances of an actual Google person being involved. If that floats your boat.

Here are several excerpts from an article by Bill Brooks, CEO of The Brooks Group, a sales management and training firm, The Ten Dumbest Things Salespeople Do:

The truth is, knowing what not to do in sales is just as powerful as knowing what to do. I’ve assembled a list of ten of the dumbest things salespeople do — things that are virtually guaranteed to totally and completely de-rail your selling career.

1. They don’t become students of their craft - These salespeople begin strong selling careers, and they really get into it — but then they go to sleep at the switch and forget to do things like read industry publications or new books by sales masters. They don’t go to sales seminars, listen to audios or view videos on sales-related topics. In short, these salespeople don’t constantly re-invigorate themselves.

2. They don’t “narrowcast” their offering - This means that they don’t become specialists at a particular type of market, or at delivering a specific type of product; they stay generalists.

3. They fail to position themselves correctly - The way people position themselves determines how their prospects and customers see them. In short, people pay attention to people whom they perceive as having something important to say to them.

4. They fail to prospect - This is huge. The biggest cause of failure in sales is having an inadequate supply of qualified prospects. How do you get prospects? Like I said above — host informational sessions for prospective clients, send mailings with targeted lists, speak at association meetings, host user’s groups, or offer a webinar.

5. They get in front of the wrong people - There’s an old statement that goes: “You can’t get rich selling to the wrong people.” It is best to be in front of people who: Can make a decision, have a need, have a perceived problem, or pain, and are willing to listen to you.

6. They listen to their peers - Listening to your peers often means you get too much negative input. It is important to understand that 80 percent of your peers are only delivering 20 percent of the results. And you know what? They’ve got nothing better to do than hope you’re not successful, either — so it’s not logical to accept their advice. Instead, listen to positive, upbeat advice that makes you feel good, and think clearly.

7. They don’t understand the economics of their product or service - Would you sell something for a buck and a half that cost you a buck? No you wouldn’t, but unfortunately several salespeople don’t understand value costing, and that’s exactly what they end up doing! These salespeople don’t truly understand what it costs to deploy their solutions in the field. They don’t understand the expense of telephones, manufacturing, advertising, marketing and promotion, so they end up giving the product or service away.

8. They mentally spend their income, before they earn it - If your pay plan is somehow designed to reward you for production or performance — not just a base salary for being around — listen to me. The sale is not made until you have received your commission check and it’s gone into the bank, and it’s cleared — only then is the sale consummated.

9. They fail to ask the right questions - In fact, they may have failed to ask questions at all. Or worse, they did ask questions, but didn’t listen to the answers.

10. They are either digitally compulsive or digitally impaired - In other words, they are so compulsive about digital technology that they spend all of their time on the Internet, or in sales force automation products. Either that, or they’re so impaired that they’re absolutely frozen about utilizing it. As simple, basic and fundamental as it sounds, the truth is — the most successful person is going to be the one who’s going to be in the middle. Bottom line: You should not be sitting in front of your computer screen all day long; you need to be eyeball to eyeball with prospects and customers.

Here are the most interesting CRM-related news stories from the past week:

• What (Potential) Apex Developers Want from Salesforce
• Salesforce.com Nabs SAP Marketing Exec
• AppCentral from UtilIT Now Available on Salesforce.com's AppExchange
• Versata Commission On-Demand Solution Now Available on Salesforce.com's AppExchange
• RightNow Prepares New Version of Hosted Service
• RightNow Announces Senior Appointments
• SaaS Explodes and Takes New App Directions
  
• More Large Firms Now Deploying On-Demand Apps
• 37signals Sends Latest Ripple with Hosted CRM
• Oracle Plan Aims to Accelerate SMB Vertical Sales
• Fuze Announces Availability of 6.2 Release
• Infowave Releases echo Solutions Version 3.2
• Aspire Technologies Offers QuoteWerks™ 4.0
  
• NetSuite Moves Up the E-Commerce Ladder 
  
• E-Commerce Platform Released, to Optimize In-Store Operations, from iCongo
• Vendors Form Open-source Business Alliance
• Microsoft Brings Analytics to the Desktop 
  
• InvisibleCRM Joins the Microsoft Partner Program
• SPSS Clementine Software Obtains “Powered by SAP NetWeaver” Qualification
• ClickFox, Inc. Announces Enhanced Customer Behavior Intelligence Technology
• Omniture Acquires and Discovers
• Verint Buys Witness
• Avaya Brings Out New VoIP Wares for SMBs
• RIM Introduces the Sleek New BlackBerry 8800 Smartphone
• Citrix to Release Tarpon Technology
• Oracle Provides Continued Availability and Platform Support for HP
• Pageview Metric is Becoming Worthless
• Google Revs Its Mini
  

Here is a summary of results from a recent Customer Experience Management research study conducted by the Strativity Group:

A majority of companies fail to deliver differentiated value to customers and therefore fail to maintain their loyalty. Additionally, companies routinely fail to analyze and manage their customer relationships according to specific financial criteria,leading to the ineffective execution of customer strategies.

Although respondents declare that customer strategies are more important than they were three years ago, the majority acknowledge that their employees do not have the tools or authority to resolve customer issues - a major indicator of customer commitment. "Respondents honestly admitted that they are selling commodities and that their core value proposition does not merit customer loyalty," stated Lior Arussy, company founder and author of "Passionate & Profitable" (Wiley, 2005). "Such an admission should serve as a wake up call to every executive to reexamine their core value propositions and ability to deliver differentiated customer experiences."

Results Highlights -

• 60% of senior executives claim they do not deserve their customers'loyalty
• 51% of respondents claim that their company does not deliver unique and beneficial products or services
• 56% agree that their company's products or services are worth the price they charge
• 34% affirm that they have the tools and authority to serve their customers
• 75% do not know the cost of a new customer

Strategies Fail at Execution -

According to the study, 70% of companies indicate that customer strategies are more important than they were three years ago. Yet, basic execution parameters such as frequently visiting customers (34%), providing the necessary tools and authority to employees (34%), and strongly linking compensation with service quality (29%) is lacking.

It's All in the Financials -

Overall, the study indicates a widespread ignorance regarding the economics of customer relationships. Over 75% of respondents did not know the cost of a new customer while 81% did not know the cost of a customer complaint. 50% of respondents did not know their organization's annual retention rates. The failure to manage customer relationships on the basis of clear and pertinent financial metrics explains why companies' strategic intentions often fail to translate into sustainable customer-centric actions. Organizations do not invest the appropriate resources and funds to establish long-term relationships because they are unable to justify them financially.

Employee Readiness to Execute Remains a Challenge -

The general trend is one of diminishing corporate investment in employees -- ultimately leading to the curtailment of the employee's ability to properly execute customer strategies.

• 29% of the respondents indicated that their compensation plan emphasizes quality of service and not just productivity
• 34% of respondents claim that their employees have the tools and authority to solve customer problems
• 30% of respondents agreed that their company invests in people more than in technology.

Companies continue to declare their commitment to customers while not fully comprehending what this commitment entails. As such, customer experiences are commoditized, employee readiness is limited, and strategy execution is deficient. The failure to create and deliver differentiated experiences leads to the failure to command premium pricing, drive preference of company or product, gain greater portion of customer budgets,and ensure the permanence of overall relationship longevity.