Perfecting Service Management

Issue #53

Tuesday, September 14, 2004

Becoming Customer Centric
by Craig Bailey

It is the aspiration of many companies to become customer centric. This series of our newsletter will share learnings and approaches with the hope that it will help you in your quest to transform your company into a customer centric organization. To be clear, this is a journey and not a destination.

A first step in becoming customer centric is to define what it means, to your firm. Our definition of becoming customer centric, which has applied to a number of firms that we have worked with, is: "Aligning the resources of [your organization] to effectively respond to the ever-changing needs of the customer, while building mutually profitable relationships."

Now, let's break that definition down into three parts so that we can discuss each:

  1. Aligning the resources of your organization
  2. Effectively respond to the ever-changing needs of the customer
  3. Building mutually profitable relationships

A common misconception that we have observed is that personnel of a firm initially believe that becoming customer centric means that you must perform as a "doormat" for the customer. Because of this all too frequent misconception, we will discuss the 3rd item in the above list in this edition.

Upon launching an initiative to become customer centric, it is not uncommon to (initially) observe personnel making statements to the effect of "if we are going to be customer centric, then if the customer requests it, we simply must do it." The reality is there is a balance.

Our definition of "becoming customer centric" deliberately includes the key phrase "building mutually profitable relationships" in order to consider the impact on the firm and the customer relationship. It is important to ask key questions such as: Can we profitably, and on a repeatable basis, deliver on this customer's request? Is it supportable for the long-term? Are we simply saying "yes" to appease the customer, when in fact we know (deep down inside) that it will cause problems later?

Being customer centric requires that you seek to understand the customers' needs, set expectations about what can/cannot be done, provide alternatives if a customer's exact request cannot be accommodated and then meet/exceed those expectations.

In summary, becoming customer centric does not mean that you become a door-mat for the customer. The reality is that if your firm doesn't remain profitable in its relationship with the customer, then you will cease to exist. That wouldn't be very customer centric, would it?

In future editions we will break down the first 2 segments of the definition of becoming customer centric, and subsequently share approaches for facilitating this transformation.

Exploring Outsourcing: Implementation
by Kurt Jensen

Our exploration into outsourcing has taken us from creating a request for proposal through reaching an agreement. By this time, each party has learned a great deal about the other and likely has engaged Project Management folks for one reason or another along the way. The next step of the process, Integration, will take the written terms of the agreement and turn them into a working model. Below are a few examples of high-priority areas for the Integration process.

  1. Establishing a Hand-Off Date as basic a decision as this may seem, the hand-off date represents everything which has been worked toward to date. As such, it needs to be realistic considering various dependencies.
  2. Telecommunication and Data Communications this is a simple fundamental of Integration. Typical install timeframes for telecommunication (and often data) are in the neighborhood of 45-60 days. Acceleration of these dates depends on a number of issues including available facilities, credit rating and/or telecom field availability.
  3. Agent Hiring and subsequent training without agents there is no program. As you are likely aware, hiring can be a time consuming task and needs to prioritized as it relates to the had off date.
  4. Customer Relationship Management system one way or another, the details of your customer contacts need to be captured it is the extent of detail which needs clear definition. For the sake of brevity, a CRM system's complexity is entirely program dependent and will consume time/resources respectively.

Within the agreement there are specific metrics which the vendor will perform against. Tracking the performance of the vendor against these metrics is a key relationship management issue from launch forward. Several of these measurements need to be reviewed on a monthly basis. Other timeline related items also need to be tracked. Below are a few examples of high level metrics and timeline items which need to be tracked post implementation.

  1. Service Level a metric often tied to performance penalties or incentives. This measurement may apply to inbound calls, first touch resolution or a variety of other communication channels. This metric requires a monthly review and a related deep dive if the metric is dramatically overachieved (is the vendor over staffing and hence driving the program cost up respectively?) or underachieved (what is the issue?).
  2. Hours of Coverage unless a 7x24 hour program is being deployed, a monthly review (or more frequently depending upon the nature of your program) of contact volumes toward the start/end of the coverage period and missed contact volume off hours is very important. The opportunity to save program dollars exists if volume starts later and ends earlier. Likewise, coverage hours may require expansion if a significant number of contacts are missed during off hours.
  3. Agreement Renewal many agreements contain automatic renewal statements if notification of intent to not renew is not provided at least 90 days in advance. This very important timeline item represents your chance to modify the program, including visiting problematic issues or moving it to another vendor without penalty.

One aspect of any outsourcing relationship which can be easy to lose in the shuffle is the fact that each party desires a positive outcome. Vendors are skilled in the area of Integration and live a life of reporting monthly performance to clients. For each party, signing an agreement and moving to the Integration phase is one day closer to the day when the investment and effort begins to pay off.

Contact us if you would like to share outsourcing or RFP experience. If you are thinking about outsourcing, we can help you manage the process, while you focus on your business!

View previous articles in this series.


+ Becoming Customer Centric
+ Exploring Outsourcing
+ Recommended Reading
+ Speaking Engagements


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Recommended Reading
Paul Greenberg's article Creating Realistic Customer Expectations in CRM Magazine stresses the importance of expectation management. While there are many dimensions to customer service, positive customer satisfaction starts with setting proper expectations.

Speaking Engagements
CCI President Craig Bailey will be a speaker at PDMA's (Product Development and Management Association) 7th Annual "Voice of the Customer" conference on December 7-10, 2004, in San Francisco CA. Presentation materials will be available for download from CCI's website closer to the conference date.

About Customer Centricity, Inc.
We strengthen overall company performance through better service delivery and management.

We boost efficiencies in front-line customer service and technical support teams, order processing, fulfillment, field service, logistics and other key operations functions.

In short, we align the resources of your organization to exceed your customers' expectations in the most effective and efficient manner possible.

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