The impact of customer service on loyalty - Part II

Why being customer centric starts with your company culture In my last blog I discussed the concept of (Minimal) Customer Effort and the need for your organization to make Service...

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April 27, 2017
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Solving the customer’s problem is the most crucial aspect of customer service. But why does it prove to be so difficult? It all comes down to one thing: culture. Company culture determines how a customer service department is perceived, how employees view their own added value and most of all: how customers feel treated.

Firstly, the Customer Service Department is mostly seen as a cost center. Which is why those responsible for performance management often use the very UN-customer-centric measurements of ‛Average Handling Time’ or ‛First Call Resolution’. Making customers happy is not a priority for them, only cost-cutting. That’s a dangerous mistake to make in this era of fleeting customer engagement.

Secondly, service representatives  are left feeling frustrated and unappreciated when their department is seen as a cost-driver. In addition, stakes and challenges have become higher. Customers become more demanding and can easily punish companies on social media. Reps feel they can’t keep up with Management’s expectations and lots of burnouts (and frequent onboarding of new people) are the sad results.

And thirdly, customers  will obviously feel far more positive towards a brand when the interaction leaves them happy and satisfied. Regardless of the actual amount of effort required by the customer – which could be measured in time for example – it is the customer’s perception of the experience that effects loyalty. In fact, research has shown that the action which is required from a customer only accounts for one-third of the perceived customer effort; the other two-thirds is how he was made to feel during the experience.

So how can companies keep up with these ever-growing demands?

Their CULTURE is the key. An open and flat culture will change the mindset of every employee involved and will, eventually, lead to service that is perceived better by the one who matters the most: your customer. But how can you change your culture? It requires you to rethink your CORE VALUES and make them the key drivers of how you view performance. It also requires another major shift: to move from control to trust. Empowerment of all employees is challenge #1 for most people in leadership roles.

At online retailer Zappos (now owned by Amazon), the company culture really came first. As its visionary founder Tony Hsieh puts it “our Business Strategy, since 2005, has been to invest in company culture, in the belief that the culture will ultimately drive employee productivity, customer service quality and brand strength”. To Zappos, this culture is ‛a Culture of Service’. They deliver a WOW experience for customers through their service. Their culture defines who they are, not what they do. To put it in an extreme manner, “Zappos is a SERVICE company that happens to sell shoes, clothes and stuff”. The way they went about defining their culture was to discover – by asking their own staff –what their real core values were. In the end, they came up with a list of 10 and they call them committable values since they are willing to hire and fire upon them.

Zappos is, without doubt, a very customer-centric company (their first value being “deliver WOW through service”) and during our visit on our ‛Innovation Tour’, you could actually breathe in that mindset. But what struck me the most is that every single employee has the absolute empowerment to do what (s)he thinks is necessary to make the customer experience  a happy one. They are averse to following a preferred, prescribed resolution path but, instead, are focused on creating what they call “a Personal Emotional Connection” with the customer. They are trusted to do exactly what it takes to provide the ultimate experience. They overstaff on purpose to make sure customers have someone on the phone DIRECTLY within 20 seconds. I can hear you thinking “how can you overstaff and still make money?” Well, for one thing, their excellent service has created an enormous customer loyalty and has driven their immense growth. And what’s more, they can save money compared to traditional organizations because they have no managers in the call center!

So can their reps do whatever they like? Are they not measured? Are they not rewarded based on their performance? Twice a yes and one no. Yes, they can do whatever they think is reasonable to make their customer happy. Yes, they are measured, via a customer survey sent out after every single contact and an average score of 4.8 out of 5 required. But no, they do not apply performance-based increases; employees are given a raise based on pursued growth and learning, so it is all about acquiring new skills.

I am aware that changing your company’s culture is not something you can do overnight. But there is no excuse for not taking the first steps NOW. In everything  your organization does, make sure it starts from the customer’s standpoint. Invest in a new mindset, not based on selling, upselling or cross-selling, but based on the relationship with your customer. We are all human beings and we will view any company from an emotional perspective; after all, it is never about B2B or B2C, it is about H2H: human to human. To be honest, there is no department within the company with a higher ability to create ultimate experiences than Customer Service. Trust the sales reps’ judgments to the fullest, setting them free to do whatever is right to serve the customer. Invest in these people, reward value-driven behavior, turn the Customer Service Department from a cost center into an experience center, staffed by people who live and breathe for your one and only asset: your customer. You will be rewarded with employees that are willing to go the extra mile. As Simon Sinek put it: “when people are financially invested, they want a return. When they are emotionally invested, they want to contribute.”

This article is part of a series about 'The impact of customer service on loyalty'. Read part I here

Nancy Rademaker
Nancy Rademaker
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April 27, 2017
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