Perfecting Service Management

Issue #14 Tuesday, March 18, 2003

Welcome!

topical index

Welcome to this edition of the Customer Centricity newsletter, where we explore ways you can improve the performance of your service organization.

In this issue Ida Zecco shares the third article in the ACTIVE series: a self-assessment providing insight on how to hang-on to and grow your SINGLE source of revenue - the customer. Additionally, Tom Gormley provides an article on how to strengthen your customer relationships by considering customer data a competitive asset.

 

In this issue:

Customer Centricity Delivering A Customer Service Workshop

Customer Centricity is again scheduled to present "A Customer Service Workshop" at Rivier College, in Nashua, NH. This event will take place on Thursday, March 20, from 5:45-7:45pm. This program is sponsored by the New Hampshire Small Business Development Center.

To register contact Rosemary Macmillan at Rivier College at 603-897-8587 or via email at rmcmillan@rivier.edu.

Rivier College, Calendar of Events:

www.rivier.edu/administration/college_relations/calendar_of_events.asp#3-17

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ACTIVE - Part 3

By Ida Zecco

This is the third article in the series, which covers the six-step self-assessment process, ACTIVE, to help you to hang-on to and grow your single source of revenue, the customer.

A - Account Management
C - Customer Lifecycle vs. Sales Cycle
T - Account Team
I - Internal Infrastructure
V - Value Proposition
E - Enable Customer Involvement in Product/Service Development

T – Team has been so overused, that it has little or no meaning to employees today. Perhaps this is because we talk about team, but we measure, recognize and reward individuals. Reward & Recognition = Performance. Our employees meet the standards that are set by management. Consider shifting your reward and recognition from
product to customer.

There is no Account Manager that is successful alone. There are countless, nameless, unrewarded, uncommissioned employees who are part of a greater whole, a greater sale, a greater opportunity. These vitally important teams of people are usually not organized as members of Account Teams. This is a place where potential breakdowns in the Customer Life Cycle take place. There is no “customer focus” between Sales and Operations; instead, it is a
product focus: “Fill out the order, prepare the appropriate paperwork and customer order tickets, feed them through the system, build, test, deliver, switch it on.” These are the very basics. This is about product. This is what everyone does—including your competitor.

Completing these basic tasks to the highest standards is the very least of what is expected from your customer. But, if you ask yourself, “Within this step of the customer life cycle: what is the expectation?” The question is how you provide the above service/product to your customers. And, how do you know how well it was received? What are your measurement criteria and are they accurate? How are levels of the Account Team measured, rewarded and recognized for their customer focus? Is Operations/Engineering/Billing, etc., included in your yearly Sales Conferences/Reward Seminars/Strategic Planning? Are you bringing together all of the parts that affect revenues and profits? Are they sharing information, ideas, and initiatives? Are your internal organizations constantly reinventing the wheel—thus, needlessly spending more because they do not regularly meet, plan and strategize?

I will review remaining elements of this self-assessment (the "IVE" in ACTIVE) in subsequent newsletter editions.

Previous articles in this series:

Part 1  Part 2

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Is Your Customer Data a Competitive Asset?

By Tom Gormley

This is the second part in the series on the application of customer data management (see Lauren Weiss' article, Strengthening Customer Relationships With Data Integrity, 3/4/03), the management and utilization of customer data, to improve the performance of customer service organizations. An IT research group called the Center for Information Systems Research (CISR), at the Massachusetts Institute of Technology, recently published a Briefing paper titled, “Customer Data as Competitive Asset.” While not focused on customer service per se, the research has some valuable lessons for customer service and other business managers who would like to get more bang for their buck from existing customer data resources.

MIT’s study examined the practices of 15 companies in their management and use of customer data, with a focus on identifying those practices which created the most value as measured by metrics including increased productivity, customer satisfaction, sales conversion rates, cross-selling, and return on marketing expenditures. We would summarize the major conclusions of MIT’s research as:

Approach: The approaches companies use to transform customer data into a valuable asset fall into three categories: a) Data Utility, b) Enhanced Marketing, and c) Customer Intimacy. Each was found to have at least some value, but each also has considerable risks.

Value: Data utility, an “if you build it, they will come” approach, led by IT, has minimal value and is ultimately destined to fail, as business users and managers never really buy in (yet many still fall into this trap). The enhanced marketing approach yields excellent value in some projects, but less in others. It puts responsibility for customer data management into the hands of individual departments and business units, such as customer service, but mostly led by the marketing organization. It also lacks a central, core strategy for dealing with customer data issues such as integration, accuracy, and security. Customer intimacy appears to generate the most value, by completely re-focusing an entire company around its customers and providing rich customer data and insight to key constituents, to enable and guide such dramatic change.

Recommendation: Choose either the enhanced marketing or customer intimacy approach, based on your company’s strategy, and its commitment to customer focus. Not every company should attempt the customer intimacy approach, despite its apparent promise of competitive gains in customer loyalty, retention, and market penetration. That is because for many companies, even as they tout the importance of customers to their business, the overriding focus is really either product development or operations excellence, and you can’t be all things to all people. The customer intimacy approach to customer data is far too demanding for companies that don’t have customers as their absolute number one priority. If you want to read more about this view of three corporate disciplines, pick up a copy of “The Discipline of Market Leaders” by Treacy and Wiersma.

A very interesting but not yet documented finding of this research was that customer service departments were quite often last on the list -- after marketing, sales, and others – to benefit from investments in improving customer data. In the next Newsletter, we will address what you can do to change that, to put more useful, insightful, productivity-enhancing customer data into the hands of your customer service reps, starting with the Basics, then Analytics, and finally, Proactive customer knowledge.

If you’d like to read the full, published MIT Briefing, “Customer Data as Competitive Asset”, or discuss its findings, please contact Tom Gormley, one of its authors as well as an Associate of Customer Centricity, at jtg3@alum.mit.edu.

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More About Customer Centricity, Inc.

Customer Centricity is a business consulting firm that partners with companies to improve the performance of their service organizations. We leverage our real-world experience to help our clients manage their customer relationships in more effective and satisfying ways.

Customer Centricity delivers on this promise by optimizing the interaction between people, process and technology to achieve higher levels of customer satisfaction and increased operational efficiencies. We provide:

  1. Comprehensive assessments to identify the actions that will yield the greatest return;
  2. Skills Training to enable customer-facing personnel to deliver exceptional levels of customer service;
  3. Design and Implementation of business process techniques to serve the customer in efficient, effective and consistent manners; and
  4. Identification of the appropriate business processes to automate, enabling companies to get the most from their investments in technology.

In addition to our core practices, we also maintain a network of strategic partnerships to provide end-to-end consulting across your organization with a commitment to seamless execution.

Click on the following link to see what our customers have to say.

To learn more about Customer Centricity:

call: 603.491.7948

send e-mail to: info@customercentricity.biz 

or visit our web-site: www.customercentricity.biz

In Closing

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Copyright (c) 2003 by Customer Centricity, Inc. All rights reserved.