Stakeholder Magazine - Nov 2007

Creating value for customers, employees and shareholders

Do customers like being surveyed?

PRUDENTIAL GOES THE EXTRA MILE FOR ITS CALL CENTRE CUSTOMERS CUSTOMER SERVICE DIRECTORS’ COMPETENCE FRAMEWORK EMPLOYEE SATISFACTION WHY BOTHER? UKCSI WAVE 1 RESULTS

PLUS NEWS BOOK REVIEW DIARY DATES

November 2007 VOLUME 4 ISSUE 2 £4.50

Download or view a copy at

www.leadershipfactor.com Alternatively contact Ruth on 0845 0252565 or email ruthcolleton@leadershipfactor.com

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Diary Dates

November 2007 28 Employee

Training courses and Conferences from around the country.

Employee Satisfaction Why bother?...

7 News

32 Customer

Aston Martin pip the Apple iPod to top the Cool Brands list 2007.

Customer Service Directors’ Competence Framework.

8 Case Study Prudential goes the extra mile for its call centre customers.

35 Fast Guide Blogging.

13 Customer

38 Book Review

Do customers like being surveyed?

How Customer Satisfaction surveys make customers more loyal.

In this edition we review both the latest publication from The Leadership Factor’s Nigel Hill and Don Hales’ ‘60 Second Leader.

In this issue...

VOLUME 4 ISSUE 2

18 Customer Sarah Stainthorpe reports back on the European Customer Management World Conference.

24 Customer

39 Training Directory

UKCSI Wave 1 Results.

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Charlotte Ratcliffe editor

There’s lots of talk about the desirability of a joined-up customer experience; whatever the channel, whatever the product, whichever individual you spoke to last time, it’s all there next time you call or email. It all makes perfect sense, and it’s the easiest thing in the world for consultants to lambast organisations in books and on conference platforms for failing to attain such elementary service standards. But let’s be honest, it’s not always that easy. The Prudential article illustrates the potential scale of the problem. 22 call centres with different technology and 500 telephone numbers that customers could call! They now have one free-phone number that takes you straight to a member of staff who doesn’t read from a script and is empowered to meet the customer’s needs as required. But imagine the journey to get there. Turn to page 8 for the full story.

This all sounds great but does it pay? And can it be demonstrated?

For the Pru the answer to both questions is yes, as shown by a 30% increase in customer retention and recommendation plus a 20% uplift in employee satisfaction. Happy staff, happy customers.

Portman Building Society introduced monthly event-based customer satisfaction surveys to demonstrate the effectiveness of their ‘joinedup customer and people strategy (see page 18). Also from presentations at the European Customer Management World Conference was information from AXA about how they improved their customer experience through a staff bonus scheme based on claim-specific customer satisfaction surveys.

But what effect are all these surveys having on your customers?

People have a tendency to generalise from the particular. A very dangerous habit, as anyone involved in any kind of research should realise. Readers of this magazine are very likely to be highly educated with successful careers, well above average earnings, high levels of confidence and never enough time to accommodate your busy life schedules. So you’re probably not keen on doing anything, like taking part in surveys, that’s not on your highly organised agenda.

Frederick Reichheld, who should know better about generalising from his own very untypical life experiences, writes with vitriolic feeling in ‘The Ultimate Question’ about how much people hate taking part in ‘useless’ customer satisfaction surveys. Based on his own and a Jaguar driving friend’s personal experience of 2 customer satisfaction interviews! For the real, objective story about how customer satisfaction surveys affect your customers, read about the latest academic research on page 13 You can also check out the book review on page 37 if you want a fully referenced and objective book about how to understand and monitor the experience your organisation is giving its customers.

Stakeholder Satisfaction is the magazine for people who want their organisation to deliver results to employees, customers and any other stakeholders as part of a coherent strategy to create value for shareholders. We publish serious articles designed to inform, stimulate debate and sometimes to provoke. We aim to be thought leaders in the field of managing relationships with all stakeholder groups.

Editor: Features Editor: Contributors

Charlotte Ratcliffe Sarah Stainthorpe Nigel Hill Stephen Hampshire Jackie Lindsay Jim Alexander Don Hales Martin Donohoe Rob Ward Designer: Creative Director: Rob Egan Louise Martin Advertising: Editorial Director: Janet Hill

Printers of Stakeholder Satisfaction www.stakeholdermagazine.com info@stakeholdermagazine.com Stakeholder Satisfaction PO BOX 1426 Huddersfield HD1 9AW Tel: 0870 240 7885 NB: Stakeholder Satisfaction does not accept responsibility for omissions or errors. The points of view expressed in the articles by contributing writers and/or in advertisements included in this magazine do not necessarily represent those of the publisher.

Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without prior written consent of the publisher.

Copyright © STAKEHOLDER SATISFACTION 2007

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News

news

Studies Say Outsourcing Abroad May Compromise Brand Two recent studies have revealed how cost-cutting strategies are alienating many British customers. When questioned a huge majority of customers said they would abandon a brand should they switch their contact centre overseas or make it more difficult to speak to an operator.

With around 17,000 foreign call centre staff working for British firms in the financial sector, many brands including NatWest, Direct Line and Nationwide – have started to promote the fact that they do not use overseas operations.

It was revealed in the first study carried out by Nationwide that seven out of ten adults (74%) prefer call centres based in the UK as they believe they receive better service, its better for the UK economy and their calls are answered more quickly and efficiently. The study also revealed that 79% of consumers said that they would be less likely to deal with a company that used call centres abroad.

Valuing & Renewing Customer Loyalty Studies have shown that the average business loses 20% of its customer base each year, but many do little about getting them back. This can mean huge financial losses, as it takes a lot more money to acquire a new customer than it does to retain an existing one. It is clear that loyal customers are generally the ones that spend more and companies with a large loyal customer base are often the ones reporting increased profits year after year.

Once you know how much your customer contributes to your bottom line, it will be

clearer to see the value of hanging onto them. In order to better keep hold of your customers it is essential to have a good system in place to gather information about them and how they feel about your product or service. One of the most effective ways to do this is by using questionnaires regularly, that ask a number of questions such as How well do we meet your needs? What are we not doing that you would like us to do? These questions can be asked using a variety of methods such as postal, telephone or via the web and open ended questions that require an active response are essential.

Airlines Face a Surge in Customer Complaints

under pressure, is dominated with problems over flight cancellations, which accounted for 40% of all written grievances with the number of customers complaining about cancelled flights up from 2,576 in 2005/06 to 4,462 in 2006/07.

As other reasons for dissatisfaction include delays and baggage complaints the AUC warned that the continued need for their assistance is set to remain and hopes that the whole experience of flying is not made so tiresome in the future that some passengers decide that however cheap the fare, flying is simply not worth the hassle and choose to stay at home.

2007 Cool Brands List Revealed

Complaints about airlines increased by more than 20% last year as thousands of passengers complained about delays and cancelled flights.

The Air Transport Users Council (AUC) – the UK’s aviation industry watchdog received more than 12,000 complaints in 2006/07. These figures only highlight however the complaints handled by the AUC after an unsatisfactory response from the airline was received and reflect only a minority of the total number as many were settled directly by the airline in question.

The range of complaints, which will add to a growing impression of an airline sector

Aston Martin has emerged top of the 2007 Cool Brands list, holding off the competition. The top 20 in the list was dominated by digital technology and online media with Apple’s iPod coming in at second place and YouTube ranking third. The list was compiled by a 2,000 member strong YouGov and Cool Brands council panel.

The issuers of the report said that the top 20 brands were split along the lines of status symbols – the likes of Rolex and Ferrari (coming in at 14th and 11th respectively) and products that were valued for their day to day necessity, such as Google, Amazon and YouTube. The compilers said that while “coolness” was entirely subjective and a quality that could not be bought, consumers were judging brands on their stylishness, innovation, originality, authenticity, desirability and uniqueness.

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Case Study

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Case Study

Jackie Lindsay Head of Voice at Prudential

Jackie Lindsay, Head of Voice at Prudential, explains how Prudential re-built their call centre around the customer. Moving away from a typical call centre set up, based on products and processes, Prudential set about designing an environment where customers could contact them easily (and for free), get straight through to a member of staff (instead of press 1 for this, press 2 for that) who was trained to respond to queries (without reading from a script) and was empowered to go the extra mile for customers.

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Case Study

Where did it start? At the top Buy-in from the top was a massive part of Prudential’s success. Prudential’s new Chief Executive was passionate about customer service and had a clear vision of how he wanted to transform the business, termed the 1,000 day plan. Everyone in the organisation knew about the vision and the role they had to play in that.

When Prudential made the decision to transform their contact centre system they had 22 call centres with no visibility of each other, with different technology and processes in each. The number of different telephone numbers that were in the public domain for customers to call gives some idea of the scale of the problem: 500! Prudential themselves weren’t aware of all the telephone numbers they owned.

From this, Prudential went about setting up one streamlined customer care system, by examining the best and worst of what they already did in the various call centres. Their objective was for their service to reflect their values, to be seen as trustworthy, to be helpful and to make it easy for customers to deal with them.

What changed?

1. Staff training Rather than being trained in depth in the technical aspects of just one product area, staff were given an overview of all products but enquiry-based training was

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the focus with staff being taught how to respond to typical customer queries.

Rather than being script-based, this training centred on using the system they had to find the answers to questions that customers frequently asked.

A new IT system was brought in, which was more flexible and easier to use, allowing staff easier access to product information in a step by step way, rather than having to look for different bits of information on 16 or 17 different screens. Where possible, the system was refined as they went along in response to feedback from staff.

Regular drop-in sessions were held where staff could talk about any problems they were having with the new system.

Overall, the emphasis had shifted from knowing the products in depth, to being able to use the system to respond to the customer. This shift in training was mirrored and supported by the introduction of new targets and rewards for call centre staff.

Instead of being targeted on the length of the call, i.e. encouraged to deal with the call as quickly as possible, staff were coached to build a rapport with the customer and encouraged to try and find out what was driving the customer’s enquiry.

For example, why they wanted a particular document sending out, asking the customer if that’s what they expected, checking the customer was happy with the response or action and proactively provid-

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ing more information if necessary e.g. if the customer didn’t seem to understand the product they had.

Where possible staff should go the extra mile in order to satisfy the customer. Instead of being monitored on average handling time, staff were measured on customer satisfaction results and outcome-based measures including first call resolution.

What changed?

2. Staff rewards and recognition Reinforcing and rewarding these new ‘right’ behaviours was done through various schemes’; “Call of the month” – Prudential wanted to put more emphasis on the conversational side of the call, rather than the transactional element, by identifying role models who were best displaying the desired behaviours such as building a rapport, wanting to understand the customer and doing the right thing for the customer. The call can be nominated by the agent themselves or one of their managers who had listened to the call. The best ten calls are listened to by senior management who then select a winner on a monthly basis.

This also allows managers to keep in touch with customers. The winner receives a trophy as well as a prize such as £100 cash or a meal. The winner’s call is also played to all.

Certificates and pictures of winners are displayed throughout the call centre.

Case Study

“Service star” encourages teamwork and is awarded to staff who go out of their way for a customer or a colleague, open to all staff not just phone-based ones.

“Idea idol” is a staff suggestion that rewards ideas to improve things, whether service to the customer or improving a system within the business. One of the best suggestions to date meant a saving of up to half a million a year for the business.

What changed?

3. Making life easier for the customer With an average customer age of 64, Prudential knew that their customers greatly valued personal contact, with many of their customers remembering the ‘man from the Pru’ era. In order to make it easier for customers to contact Prudential, there is now just one phone number which is easy to remember and a free-phone number. The IVR system was removed and a service that will ring customers back if they are in a queue was introduced. The queue buster product was something that Jackie struggled to build a business case for, but the strength of positive feedback they received during a free 30 day trial meant that the Chief Executive gave the go ahead for this.

In the feedback Prudential obtain from their customer survey this facility and the fact that customers can get straight through to speak to a person are the two most frequently mentioned positive comments.

The results As you would expect when undertaking such a huge transformation, Prudential experienced challenges during their journey, including resistance towards moving staff away from being product experts and difficulty in convincing some to move away from ingrained call centre targets such as average handling time, which were easy to use yet focused on cost reduction rather than the customers’ needs. Despite these challenges, the results of the changes made to the call centre system have been overwhelmingly positive, for both staff and customers, as well as financially for Prudential, with the benefits of the changes outweighing the costs. Ironically though, what seems evident in Prudential’s case is that they were willing to make that ‘leap of faith’ in putting the customer first, trusting that by providing excellent service to customers they would reap the rewards in loyalty terms.

than other staff, whereas traditionally the reverse had always been the case.

Telephone-based staff have a more complex job than previously, as they are now empowered to deal with the customer.

Their profile in the organisation has been raised and their importance as the face of the company is now recognised.

Improving employee satisfaction to this extent is a fantastic achievement and demonstrates that empowerment works for staff and customers.

happy

Results Highlights Happy financial advisers Financial advisers, who form part of Prudential’s customer base, have nominated their call centre for several awards, saying they are one of best organisations to deal with.

Happy staff The staff survey shows that the call centre staff are now around 20% more satisfied

Cross-training staff on all products meant a 15% reduction in the number of calls, avoiding the need to transfer customers between departments. Having happier customers is nice, but does it pay? Yes – since the change, customer retention measures have improved by a third, as have customers who would recommend Prudential to friends and family. S

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Customer

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Customer

If a company that you do business with writes to you, telephones or emails asking you to provide feedback on how satisfied you are with the service you’re getting from them, how do you react? Do you a. Regard it as totally unreasonable behaviour by the supplier? b. Feel that it shows they care about how you feel as a customer? c. See it as a pointless exercise that won’t make any difference? d. Get really annoyed and threaten never to do business with them again?

The Victor Meldrew view Some people seem to think the answer is (d). Writing in the December issue of Customer Management1, Dr Tim Snaith, Principal Consultant with technology consultancy Foretel, wrote how it alienates customers when they’re asked to take part in a customer satisfaction interview when they are “putting the kids to bed”, “recovering from a tough day at work” or “enjoying a drama premiere”. Equally offensive to customers, Snaith contends, is being interviewed in the street whilst they “are purposefully going about their lives”, being invited to take part in a web survey, “herding customers into panel groups” or other ways of surveying them.

The bottom line of Snaith’s case is that research is foisted on “an increasingly time poor customer” who takes part unwillingly, resents every minute of it and consequently buys less from the company, defects or becomes less loyal regardless of the extent to which that organisation is providing a good product or service that meets or exceeds the customer’s requirements.

The ‘gut feel’ approach Before we review the objective evidence about how satisfaction surveys affect cus-

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tomers’ future attitudes and behaviours, let’s analyse the argument from the same subjective approach used in the original article. Like Snaith, I regard myself as a fully enrolled member of the time poor club and I can give the grumpiest of grumpy old men a good run for their money. If the phone rings at home in the evening I groan out loud without knowing who’s on the other end, although in my case it’s more likely to be Champions League football than a drama premiere.

It’s probably not a market research company because I get very few requests to take part in customer satisfaction surveys.

In the past couple of years I’ve been asked to do a telephone interview for my bank and a postal survey for my local council. As it happens, when I was called at around 6pm by my bank’s research agency, I agreed to take part. (Grumpily of course!) Does this prove that people like to be consulted and agree to take part?

Of course not. No more than Snaith’s opinions demonstrate the opposite.

As anyone with even a rudimentary knowledge of research methods understands, it is extremely bad practice to generalise from the particular. Country folk knew that centuries ago when they realised that one swallow doesn’t make a summer.

Someone else who should know better is Frederick Reichheld, author of ‘The Ultimate Question’2 in which he relates an anecdote about a personal friend who was asked to take part in a customer satisfaction survey shortly after buying a new Jaguar. Despite the fact that it was a very inconvenient time, “she resentfully complied with the survey”. Does this tell us that all Jaguar owners are too timid to ask a market researcher if they can call back to conduct the interview at a more convenient time? Unlikely, no more than it proves that most customers resent customer satisfaction surveys.

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Subjectively drawing conclusions about general human attitudes and behaviours from personal experience and beliefs is widespread. Stories abound of top level management decisions based on a comment by the Chairman’s wife, or the CEO’s round of golf with one customer. Such stories are not typically used to illustrate good decisions! Harvard Business School calls this ‘management by gut-feel’ and suggests that ‘management by fact’ is a more sensible approach3.

Management by fact In ‘The Service-Profit Chain’, Heskett, Sasser and Schlesinger describe how switching from ‘management by gut-feel’ to ‘management by fact’ led to a surprising but very profitable discovery for Florida Light and Power. FLP had implemented various ‘management by fact’ techniques based on quality improvement techniques used by Komatsu in Japan3 and on the ‘service mapping’ concept developed by Lynn Shostack and Jane KingmanBrundage4,5. One of FLP’s quality improvement teams was working on the company’s objective to improve customer satisfaction by reducing the number of power cuts caused by lightning – a fairly common occurrence due to the frequency of electrical storms in Florida. The team had made the obvious, but gut-feel assumption that the main cause of the problem was lightning striking power facilities during the storms, but predicting and reducing the tendency of lightning to strike power lines wasn’t easy. When challenged about its lack of progress, the team did a factual root cause analysis, which produced the surprising conclusion that direct lightning strikes were only the third most frequent cause. A much bigger problem was damage caused by vehicles crashing into poles during storms. Further analysis demonstrated that the biggest

Customer

problem here was poles positioned on the outside edges of bends, especially if they were too close to the road. Within a year, moving poles which had been erected close to bends, had reduced vehicle-related power cuts by 78%, reducing it to only the seventh most common cause of power cuts. As a result of this and other successes, FLP’s Head of Quality Improvement put a sign on his office door saying “In God we trust; all others must bring data.”

The scientific approach As well as being unscientific, it’s unnecessary to base judgements about how surveys affect customers on subjective opinions because there have been objective academic studies and tests on the subject. Most notably, Paul Dholakia from Houston’s Rice University and Vicki Morwitz at New York University’s Stern

School of Business became interested in the many research studies that have shown that surveys have a tendency to engage people, to boost customers’ loyalty and to increase their propensity to buy a company’s product or service. However, they felt that the studies were too restricted, focusing on short term attitude change or one-off behaviour like a single purchase.

They determined to understand whether surveys had a more permanent effect on customers’ attitudes and behaviour. To do so, they undertook a field experiment with over 2,000 customers of an American financial services company. One randomly selected group of 945 customers took part in a 10-minute customer satisfaction survey by telephone. The remaining 1,064 customers were not surveyed and acted as the control group. A year later the subsequent behaviour of all the customers in the sampling frame was reviewed, producing the following results6,7:

1. Customer satisfaction surveys make customers more loyal.

The customers who took part in the telephone interview were: a.More than three times as likely to have opened new accounts. b.Less than half as likely to have defected. c.The customers interviewed were more profitable than the control group.

2. Surveys have a long term positive benefit.

Even 12 months later people who had taken part in a ten minute customer satisfaction interview were still opening new accounts at a faster rate and defecting less than customers in the control group.

3. Customers like to be consulted.

The authors conclude that customers value the opportunity to provide feedback, positive or negative, on the organisation’s

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Customer

ability to meet their requirements. Surveys can also heighten respondents’ awareness of a company’s products, services or other benefits, thus also influencing their future behaviour.

website. As well as demonstrating the organisation’s customer-focus, it also heightens customers’ awareness of improvements, thus accelerating their attitude change and re-inforcing their satisfaction and loyalty.

Frequency of surveys Objective or biased These conclusions might tempt some marketers to survey all customers all the time to increase sales! However, as well as being highly dubious ethically, such overkill might just ensure that the Victor Meldrew view of customer satisfaction surveys comes true! It has long been seen as good practice to survey individual customers no more than once a year, a reason why B2B companies with relatively few customers often conduct annual customer satisfaction surveys. To keep employees focused on the importance of customer satisfaction, and to gather earlier feedback on the success of service improvement initiatives, organisations with a large customer base benefit more from continuous tracking with monthly or quarterly reporting of customer satisfaction. Customers sampled to take part in continuous tracking studies would be flagged to ensure they could not be sampled again within 12 months.

Feedback to customers Research evidence suggests that promising feedback is a very effective way of increasing response rates to a customer satisfaction survey8. This is because whilst customers like to be consulted about the extent to which a supplier is meeting their requirements, they like it even more if the organisation acts on their feedback. But how do they know? In most cases only if the company tells them. The most customer-focused organisations therefore provide feedback to customers on the outcomes of their satisfaction surveys.

Feedback typically covers how the survey was done (demonstrating its objectivity and credibility), what they learned from consulting customers and thirdly what actions have been taken as a result of the survey. Feedback can be provided through specially printed leaflets, in customer magazines or newsletters or on the

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When people use subjective and anecdotal evidence to justify their arguments, it may be a disingenuous attempt to further their own self-interested objectives.

Frederick Reichheld contends that customers don’t like customer satisfaction surveys but encourages organisations to conduct surveys to generate a Net Promoter Score2. Without providing any empirical evidence, Dr Snaith contends that customer satisfaction surveys “contribute more to customer dissatisfaction than satisfaction1”. It transpires that he works for a company that sells software and consultancy that enables companies to conduct their own customer satisfaction monitoring using techniques such as interactive voice response (IVR), where customers are taken through a sequence of computerised questions. Even Frederick Reichheld doesn’t agree with Dr Snaith on that one, pointing out that when invited to take part in an IVR survey, “Few customers miss the message that the company considers its own time (but not yours) too valuable to waste on surveys.2” S

Scheuing and Christopher (eds) “The Service Quality Handbook”, Amacom, New York 6. Dholakia and Morwitz (2002) “How Surveys Influence Customers”, Harvard Business Review, 80 (5) 7. Dholakia and Morwitz (2002) “The scope and persistence of mere-measurement effects: Evidence from a field study of customer satisfaction measurement.” Journal of Consumer Research. 29 (2) 8. Powers and Alderman (1982) “Feedback as an incentive for responding to a mail questionnaire”, Research in Higher Education, 17

Nigel Hill Chairman The Leadership Factor

www.leadershipfactor.com email: info@leadershipfactor.com

References 1. Snaith, T (2006) “Undermining customer loyalty”, Customer Management, November – December 2. Reichheld, F (2006) “The Ultimate Question: Driving Good Profits and True Growth”, Harvard Business School Press, Boston, Massachusets 3. Heskett, Sasser and Schlesinger (1997) “The Service-Profit Chain”, Free Press, New York 4. Shostack, G L (1984) “Designing Services that Deliver”, Harvard Business Review, January – February 5. Kingman-Brundage, J (1993) “Service Mapping: Gaining a concrete perspective on service system design” in

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Customer

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Customer

he ECMW began with a pre-conference customer advocacy, loyalty and retention summit. There were several speakers who outlined their approaches to building customer loyalty, but all touched on recurring themes of creating a relationship with the customer, engaging with both staff and customers and communicating with the customer in a relevant and meaningful way. Building trust in relationships was also emphasised as key.

T

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Customer

Scott Bredbury (“the world’s leading branding expert and former top marketing guru with Nike and Starbucks”) began by highlighting why building trust in customer relationships is so vital – building trust engenders loyalty, making customers less price sensitive and less likely to leave if they encounter a problem. He noted how many organisations do not take care of the customers they have and instead constantly go after new ones, creating a high ‘churn’. He also emphasised how critical it is to have the right people working at your organisation, as it is pointless spending money on advertising to bring people to your organisation if it doesn’t work. Bredbury believes the first step to creating loyalty is setting and delivering expectations. In a climate where so many organisations don’t do this, keeping promises is crucial. He found that only 10% of people believe the advertising claims that companies make.

Organisations should also surprise and delight by doing the unexpected wherever possible. He gave an example of where he went into a Starbucks after spilling his coffee over himself (bought in another branch) and was given a towel as well as a fresh coffee, without asking or paying.

Crispin Rogers (global loyalty manager at Shell) told how Shell had created a top tier of loyalty programme to reward the customers that they most wanted. He also mentioned the usefulness of using the loyalty programme data to monitor customer behaviour, e.g. downsizing or buying less, so that investigative action can be taken. Andrew Mann (Clubcard Director at Tesco) shared Tesco’s philosophy of putting their company values at the heart of everything they do. These values are ‘treating people how you would like to be treated’ and ‘no one tries harder for customers’. The core purpose of the Clubcard is therefore

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to create value to allow customers to earn their lifetime value, rewarding the behaviour Tesco seek, rather than acting as an incentive to buy at Tesco, as they know that the Clubcard isn’t what drives people to shop with them, but instead it is used as a thank you. Mann also mentioned how critical it is to communicate with customers in a relevant and timely way, allowing the organisation to demonstrate that they know the customer. For example, Clubcard holders have to inform Tesco when they change their address so that their statements can be re-directed. Tesco take this opportunity to send out a pack to these customers, telling them where their nearest Tesco store is, and giving them money-off coupons for items usually needed when you move house.

Jill Griffin (author of ‘Customer Loyalty; How to Earn it, How to Keep it’) introduced the concept of ‘winback’. She tells how, for many organisations, a disproportionate amount of business is coming from a relatively small proportion of customers, making it problematic when these customers leave. She also noted that respectable-sounding retention rates hide big losses, for example 80% sounds good but actually means that in four years you will lose half of your customers. Her research showed that approximately two thirds of customers leave for another supplier offering basically the same service as the organisation they were originally with.

Her research also demonstrates that the success rates of selling to an ex customer are significantly higher than selling to brand new prospects. She has found that many organisations don’t know the reasons their customers are leaving, don’t know how many are leaving and don’t have a process for identifying defected customers.

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Clearly, not all customers are worth fighting for but by understanding which customers are leaving and for what reason, you can try to win back these former customers.

Griffin says that the most appealing customers for winback are those that have been unintentionally pushed away by your organisation or those that have been pulled away by a competitor offering a better value proposition, rather than customers who have been bought away, discount chasers who will never remain loyal to one organisation. Working with a company called BellSouth Mobility who were losing 500 customers a day, she focused on customers who had switched to a competitor, did some focus groups and found that although there were certain things the competition were offering better, they also discovered key defection triggers. After

testing and refining several programmes to approach former customers, they managed to achieve a 11% re-connect rate. When communicating with former customers, Griffin emphasised the importance of showing you know the customer, being relevant, and telling them you want them back.

Griffin also emphasised how crucial it is to proactively manage customer risk; organisations should have a process in place to identify customers who are at risk of leaving. More than this though, there should be a means of valuing those customers at risk. At Gallup, a trigger alert system was introduced, whereby any low scores, on a short regular survey to users, triggered an email to case managers. This trigger system reduced cancellations by 40%.

The main two conference days also featured high-profile speakers such as Ken Blanchard, Steve Redgrave and Gerald Ratner.

Customer

Blanchard highlighted the importance of having the right targets (that all staff are aware of), treating both customers and staff right and having the right leadership.

He says that a company needs strong values to act as guidelines so that staff know how to behave. According to Blanchard, companies often make the mistake of having too many values, there should only be 3 or 4, and crucially these should be in order of priority.

His guide to getting ‘raving fans’ was based on three secrets; decide on the experience you want customers to have, discover what customers want and deliver this and more.

Similarly to Bredbury, he mentioned that some companies make the mistake of spending money on advertising but don’t have the right people to take care of customers. Staff should be empowered to respond to customers individually (eagles not ducks!)

The afternoons of both main conference days were split into themed tracks where speakers from various organisations gave an insight into what they had done in their own organisations. These sessions were very useful for putting the theory into practice.

Paula Chapman of Portman Building Society took us through how they developed and integrated a joined up customer and people strategy. They began in a worrying situation where complaints were on the rise and turned it round to a complaint ratio of less than 1% of active customers. They started by carrying out customer focus groups to understand what their customers wanted and then introduced a monthly event-based customer satisfaction survey. The results of the customer research were used to define the employee attributes that they required.

They also compared the behavioural performance of existing top performing

employees and looked for consistent characteristics. They then developed an internet tool test for potential employees based on these identified desired attributes. If the potential employees didn’t score above a certain level on the internet test then they didn’t get an interview.

Recruited employees were told about the behaviours expected of them and that this was based on customers’ needs.

Chapman also emphasised the criticality of exposing customer satisfaction metrics to leaders and employees – these were reported monthly to a customer experience committee and to the board.

David Williams, Claims Director at AXA Insurance, began by outlining the difficulties of working in an industry where customers have a poor perception of you and the aforementioned all-important trust does not exist. He quoted research findings that showed insurers are less trusted than politicians. Nearly half of survey participants who had made an insurance claim believed that insurers will do anything to avoid paying out. Therefore one of the challenges for AXA was being able to deliver customer service that differentiated them from other insurers.

Williams stressed that measurement is key to delivering any transformations in the customer service area; AXA began by researching what their customer service guarantees should be, rather than assuming what customers wanted. AXA’s research identified some key customer requirements which revolved around ‘taking the pain out of the claim’; empathy, setting expectations, as customers don’t want uncertainty, and meeting those expectations.

Again, Williams emphasised that you need to measure to what extent these expectations are being met. One of the critical factors involved in AXA’s success at improving their customers’ satisfaction was the development of a bonus scheme for staff that is based on claim-specific customer satisfaction feedback.

Virgin Media measure their performance delivery to customers using ‘net promot-

Sarah Stainthorpe Features Editor Stakeholder Satisfaction If you have any thoughts about this article you can contact Sarah at: info@stakeholdermagazine.com

er’ scores, for both simplicity and its strong links to loyalty. They have set up a continuous cycle of improvement, which begins with customer feedback. The data is then evaluated, results are then cascaded to frontline staff at an individual level,

and improvements made. One major point that Virgin made was that if you’re incentivising staff on the wrong measures, such as average handling time or getting a new customer, you’re encouraging them to behave in the wrong way. It’s important to give frontline staff time to focus on the customer, rather than bogging them down with complex systems. S

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Based on a representative sample of 2,000 adults surveyed on the YourSayPays internet panel in May and June 2007, the UKCSI from the Institute of Customer Service delivers the first ever National Measure of Customer Satisfaction with UK public and private sector organisations.

Here Stakeholder takes a look through some of the highlights from the first wave of results (available online at www.ukcsi.com)

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Customer

Customer Satisfaction low customer satisfaction with Local Government (57) and Utilities (58). On a much more positive note, the results show that, in both the public and private sectors, it is possible to deliver very high levels of customer satisfaction.

The somewhat depressing outcome is that customers’ needs are not being met very well, with overall customer satisfaction in the UK running at 66. Despite good levels of customer satisfaction in Services (73), Retail (73) and Automotive (71), the overall figure has been depressed by very The UK Customer Satisfaction Index— Wave 1 Results

66 73

Services

73

Retail

71

Automotive

69

Leisure

68

Financial Services 64

Transport

63

Telecommunications Government

61 58

Utilities 56

Local Government 50

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Stephen Hampshire Development Manager The Leadership Factor If you have any thoughts about this article you can contact Stephen at stephenhampshire@leadershipfactor.com

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Customer

"customers whose complaint was handled well are more loyal than those who never experienced a problem in the first place"

The benefits of customer satisfaction

What makes organisations successful?

The UKCSI results show that immense loyalty gains result from improving customer satisfaction. At the overall level, the relationship between the two is strong and linear, with a 10-point loyalty gain resulting from every 10-point improvement in customer satisfaction.

In terms of satisfying customers, it’s clearly not size that leads to success. In only one case, British Airways in Transport, does the largest company in the sector achieve the highest customer satisfaction score. The secret is meeting customers’ needs - doing best what matters most to customers. In some areas that are very important to customers, there are big differences between customer satisfaction in the highest and lowest performing sectors.

For example, customer satisfaction with ‘the overall quality of the product or service’ is 7.8 in Retail but only 5.3 in Local Government. ‘Helpfulness of staff’, a very actionable customer requirement, scores 7.5 in the Services sector and 7.3 in Retail and Automotive compared with 6.1 in Local Government.

Who are the best Despite the generally poor showing of the public sector, the highest customer satisfaction index for any organisation was achieved by the Ambulance Service with an excellent 88. Close on its heels was the John Lewis Partnership (including Waitrose) - by far the best retailer with a CSI of 85.

Some local businesses also do very well, with hairdressers achieving 81 and both local restaurants and local electricians scoring 78. Also on 78 were VW and Toyota in Automotive and Nationwide/Portman Building Society who were well ahead of the financial services average of 68.

Staff appearance Helpfulness of staff Friendliness of staff Competence of staff Treated like a valued customer Reputation Price/cost Product/service quality Billing Continuity of staff Product/service range Information/advice Ease of doing business Tangibles Handling of enquiries Being kept informed The outcome of the complaint Handling of the complaint Speed of service On time delivery solution

7.1 6.8 7.0 6.7 6.1 6.7 6.2 6.7 6.8 6.3 7.1 6.7 6.6 6.9 6.4 6.1 4.5 4.0 6.2 6.2

1

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A very telling requirement is ‘being treated as a valued customer’. This is something that almost all organisations could improve since only the Services sector, with 7.1, managed to achieve a customer satisfaction score above 7.0. It perhaps has special resonance in the financial services sector where the regulator, the Financial Services Authority, places great importance on Treating Customers Fairly. And it is possible to do it - ask customers of the Ambulance Service or John Lewis, who score 8.8 and 8.4 respectively. The overall performance of organisations in the UKCSI is shown in the chart below:

2

3

4

5

6

7

8

9

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Customer

Complaints

UK Complaints Index

The benefits of good complaint handling

In an ideal world, complaint handling would become irrelevant as organisations would give customers a problem-free experience. However, the world is far from ideal, with many people feeling that they experience too many problems when dealing with organisations. This is especially the case with Government departments and agencies where 30% of customers have experienced a problem within the last three months. Best at giving customers a relatively problem-free experience is the Automotive sector, where only 13% of customers have experienced a problem in the last three months.

The UK Complaints Index is based on a combination of all three ways that customers judge organisations on problems and complaints:

It is worth investing in world-class complaint handling. On every loyalty dimension (Remain, Recommend and Re-purchase) there is a big difference between customers who are satisfied with the way their complaint was handled and those who are not. They are more likely to remain customers, to spend more and much more likely to recommend. In fact, the UKCSI data shows that customers whose complaint was handled well are more loyal than those who never experienced a problem in the first place.

· whether they experienced a problem in the first place · their satisfaction with the outcome of any complaint · the way their complaint was handled.

Taking all these factors into account, the sectors with the best Complaints Index, at 67, are Leisure and Retail, closely followed by the Services and

Overall

78%

Automotive

87%

9%

Services

84%

13%

Retail

83%

Leisure

82%

Local Government

78%

Utilities

78%

Transport

74%

Financial Services

74%

Telecommunications

71%

Government

70%

0

10

20

30

No problem

In most sectors, the majority of customers who experience a problem do make a complaint, although in Transport, only 38% of customers that have a problem think it’s worth complaining. Not surprising, since Transport has the lowest customer satisfaction with the outcome of complaints. Customer cynicism of this sector obviously reflects the typical response they experience when they do complain about problems. Best on the ‘outcome of a complaint’ is the Leisure sector with a customer satisfaction score double that recorded by Transport.

Although customers are very interested in the outcome of their complaint, organisations can make a lasting impression, positive or negative, by the way they handle it.

Best on professional handling of complaints are Retailers and poorest are Utilities.

40

15%

Where next for the UKCSI? Measuring the satisfaction of consumers in different sectors and comparing the leading companies in each sector has been very interesting, but what now?

Much of the value of having a national measure of customer satisfaction will come from our ability to track changes.

10% 12% 17% 19% 10% 21% 24% 20%

50

60

70

80

Didn’t complain

90

100

Complained

Automotive sectors. Poorest are Government at 54 and Transport at 53 , just beaten by Utilities and Local Government.

Overall

As the data accumulates we will also start being able to draw some definitive conclusions about the links between complaint handling, satisfaction, loyalty and business performance. How strong are these links, and what form do they take in different market sectors? Watch this space. S

60

67

Leisure

67

Retail

65

Services 63

Automotive Financial Services

59

Telecommunications

59

Utilities

57

Local Government

57 55

Government Transport

Over future waves we will be able to monitor the progress of individual companies, sectors and the UK as a whole. Are companies getting better at dealing with complaints? Are consumers becoming more satisfied? Which aspects of service are improving or deteriorating?

53 50

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Employee

ome years ago the Fairfield Inns economy hotel chain in the USA carried out some customer research and discovered that their customers, largely consisting of travelling salesmen who spent a lot of time away from their homes and families, essentially wanted to stay in a clean, comfortable room and to deal with staff they could relax with in a ‘homely’ kind of way. They did not want luxury or receptionists that made them feel they should be on their best behaviour at the end of a long day on the road.

S

Based on this information Fairfield set themselves a simple objective – to build the economy lodging business by having “the friendliest employees and the cleanest rooms anywhere.”

Where they started was not quite so simple. They realised that customers mainly came into contact with receptionists so they would need to be friendly and helpful.

This was not too hard to achieve but they also realised that the other main contact guests would have would be with the room they stayed in. In this respect their objective was to offer “the cleanest rooms anywhere” but this would not be enough to get customers to keep coming back and to be so satisfied that they would recommend the chain to others. If the room was so influential in the experience then a way had to be found to make it memorable, and the staff that could influence that were the housekeepers.

So Fairfield concluded that they had to find housekeepers that were not only extremely good at cleaning, but also had the ability to relate to guests.

It is worth noting here that most organisations (top hotels included) probably seek to pay minimum wage to cleaners and are not too concerned with the rate of staff turnover.

Fairfield took another view. They estab-

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lished some tough criteria in order to recruit people that were virtually obsessive about cleanliness, enjoyed being competitive, and were keen to get to know guests and recognise regulars.

Only 1 in 24 applicants actually got through these tests to be offered the job, and they were then well rewarded in both basic salary and bonus payments based on the results of weekly customer satisfaction surveys. The housekeepers were visible and at the forefront of guest relations. They would check with the guest that the room was in good order and they were given responsibility for a ‘guest amenity budget’ to use at their discretion to ‘wow’ regular guests by leaving small items (such as their favourite biscuits, brand of coffee or shampoo) in their rooms to make them feel more at home.

The housekeepers found their role highly satisfying and knew they were valued so they were motivated to stay longer, which meant they got to know their customers better. In addition, because they were given responsibility for their achievements they did not need much management input which allowed managers to be more focused and productive as well.

The Harvard Business School covered this case history in work which led to some important conclusions and it was published along with other examples in “The Value Profit Chain”. All companies seek to be successful and most believe that their first concern should be the customer. The conclusion reached at Harvard was that “The single most important differentiator between high and low performing firms was the adherence by management to a clear set of core values stressing the importance of delivering results to customers and employees as part of an effort to deliver profits to owners” but they also concluded that in terms of generating business improvement the order of priority should be to improve employee satisfaction first and customer satisfaction second.

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THE FRIENDLIEST EMPLOYEES AND THE CLEANEST ROOMS ANYWHERE.

Employee

Employee ntio fac Satis bother? why

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Employee

This is because satisfied (or engaged) employees benefit the organisation in many ways:· They stay longer, thus reducing recruitment costs · They are absent through illness less often, increasing productivity · They become more expert, lowering training costs and increasing productivity · They make fewer mistakes, which reduces the cost of recovering from mistakes and further improves productivity · They suggest more improvements, which make the company more efficient or effective · They get to know their customers better, helping them deliver a better customer experience · They Increase customer loyalty, resulting in more repeat business, related sales, and referrals, all of which reduces the cost of sales · They say good things about the organisation, enhancing reputation · They recommend others like them to work for the company, again lowering recruitment costs but more importantly bringing in people who are more likely to fit in and stay.

To illustrate the impact of just one factor, consider the problem of staff turnover. If there are 400 employees in your company and each year 10% leave, (a conservative estimate) you will need to recruit and train

40 new people. If it costs 1.5 times the annual salary to achieve this (again a conservative estimate) and the average salary for these 40 people was just £16,000 you would be spending almost £1 million (40*16000*1.5=£960,000). Add to this the financial benefit of increased productivity and higher customer loyalty and it soon becomes apparent that satisfying staff is actually a profit opportunity. It is unlikely that you would need to invest at this level to create the required improvement in staff morale.

Companies in the higher ranks of the Sunday Times lists of best companies to work for confirm that there are significant benefits in terms of recruitment costs, the ability to attract and retain better staff, who deliver better customer service, and increased profitability.

How do you establish a high level of employee satisfaction?

If you are lucky enough to be starting a new business you can begin by clearly defining and recruiting the kind of people you want to form it, then explain what you would like them to do and provide them with the tools to do the job and any training they might need. Trust and authorise them to make decisions and build their confidence by rewarding them for making the right ones - we learn more from the mistakes we make than when there are no problems to overcome, but the key to improving lies in not making the same mistake twice.

New employees treated this way will thrive but it is more difficult for an established organisation to satisfy and motivate the wide mix of staff already in place. Not all people are motivated by the same things, some seek challenge and development,

some merely want stability and a steady income, while for others their job may fulfil their need to demonstrate their skills and make a difference.

People of different ages, gender, background etc have different needs and whatever the needs are it will be necessary to understand and (unless their need is to dominate or bully others) try to meet them in order to satisfy your employees, and at this point you would expect me to talk about surveys so I will, but only to provide some basic guidance.

Most companies have employee surveys carried out from time to time but I believe that the majority are less useful than they could be. These are what I call Employee Opinion Surveys, which contain a list of generic measures created by the management or a consultant (or have been copied from a book or someone else’s survey). They are often very long and ask employees to rate their employer on a 5point verbal scale.

The objective of this type of survey is often to benchmark the results against those of other companies in the same industry or locality so that a defence can be offered if staff complain about terms and conditions. Staff and management often regard this as a low value Human Resources exercise rather than as a means of improving engagement. These surveys will measure perceptions of what is on the survey, but not always what actually matters and will make a difference to employees. Low response rates for such surveys are frequent and anything less than 50% must raise doubts about relevance and validity.

An Employee Satisfaction Survey is different. It is conducted in order to understand

Employee

happy that their responses will be anonymous this is the best method, otherwise a printed questionnaire should be used.

Jim Alexander Director The Leadership Factor

what motivates employees, to assess their satisfaction on aspects of working life that make a difference to them, and to identify the areas that should be improved first to provide maximum return on investment. The list of measures to be included in the survey must be decided by the employees themselves, focus groups being the best way of achieving this so that only the most important twenty to thirty measures are included in the subsequent survey of all employees. This makes the survey easier to complete as well as much more specific to your employees so they are more likely to take it seriously.

The survey should be conducted annually but the focus groups are not needed every time because needs don’t change that fast. The scale of measurement should of course be the 10-point numeric scale which you should have read about in other articles in Stakeholder (please ask me if you need more convincing) and which provides so much more valuable detail than other scales.

It is essential for staff surveys to be conducted through a third party. If you run the survey yourself you must accept that some staff will withhold their true feelings for fear that it will inhibit their career progress or at best make things awkward, and others will exaggerate things in the hope of gaining advantage. Either way you will obtain a distorted view and may well waste time and money changing the wrong things. If your staff are comfortable with the survey being web based and are

The list of measures should be used twice in the survey, once to gather satisfaction scores and again to assess the importance of the measures. It is useful to ask an overall satisfaction question, and to seek clarification for any low satisfaction scores. There should also be a section to measure loyalty and a section to collect essential demographic information to facilitate analysis of grouped data.

Once your survey is completed the analysis should help identify what motivates staff and what needs to improve for them.

Some things will be generally applicable (such as communication and knowing what others do) and some will be specific to certain groups or departments (management style, training, bonus awards etc). This magazine has covered analysis and interpretation in other issues for Customer Satisfaction Research and the process is really very similar for Employees.

There are some vital things to do after the survey.

First the results must be presented to senior management, who are clearly responsible for employee satisfaction. There may be some discomfort felt on seeing what staff actually think but if that is the case then there is opportunity to improve things.

Next the results (or at least an overview) should be shown to employees. It can be highly effective to involve staff in defining what needs to be done to improve in the areas identified as priorities, so forming a representative team that can review the data, recommend solutions and then participate in their implementation will produce results quickly.

In summary · Employees are a critical business asset. Recruit for attitude and train for skills · Measure your success as an employer each year – independently and from the employees’ perspective · Identify the key drivers of employee motivation · Invest in change where it will have most effect · Empower them to deliver memorable results for customers · Provide excellent support systems · Recognise good performance · Understand the links between employee and customer satisfaction · Quantify the benefits to the business If someone buys your product or service once, you have almost certainly spent more on attracting their business than the profit you have made. Only by providing an experience the customer wishes to repeat will you start to make a profit.

Your competitors may be able to copy your products and beat your prices, but the difference created by satisfied staff who are rewarded for, and motivated by, achieving continued extraordinary success for their company, will make you the first choice for the most profitable customers.

So take it seriously, your staff really are your most valuable asset. S

Senior management must review progress of the team regularly (at least quarterly) and any improvements need to be publicised widely to be sure that they are noticed and related to the survey (to improve participation in your next survey).

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Customer

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Customer

SAYS DON HALES, FOUNDER & CHAIRMAN OF JUDGES OF THE NATIONAL CUSTOMER SERVICE AWARDS on Hales, Founder & Chairman of Judges of the National Customer Service Awards has had the opportunity to study at close quarters customer service in many leading organisations in every service sector. He is convinced that the secret to great customer service lies in leadership. He has linked with leading research organisation, Glowinkowski International to establish the behaviours of top customer service leaders...

D

My main professional interest lies in customer service and proving the link between great service and its beneficial effect upon the bottom-line.

Occasionally however my business activities stray into other fields and this was so a few years ago when, on the strength of the reputation of the National Customer Service Awards, I was invited by the British Computer Society to advise and help them with their award programme. My IT skills do not extend

beyond those rudimentary enough to get me around Word, Excel and PowerPoint but I do know about running award programmes and together we reinvigorated the BCS IT Awards, such that they now rival the National Customer Service Awards in size and delivery.

What I did not anticipate was that from my liaison with the BCS would spring a project that, I believe, can be a lynchpin in our understanding of how to produce great service on a consistent and profitable basis. My opinion has always been that great, and for that matter poor, service starts at the top of an organisation and percolates all the way down if the vision and strength of the leader is strong enough. Just look at the companies in the UK that enjoy reputations for great service – John Lewis, Tesco, First Direct and others – in all cases the passion and commitment starts at the very top.

It is the same for poor service. In my area, we recently had an example. A young man chained himself to a bed in the window of a local furniture store and refused to move until the company delivered the bed that he had ordered months before but which consistently failed to be delivered. The police were called and tried to reason with him. He explained the history of how many calls he had made and of all the broken promises. Unsurprisingly, the company managed to deliver the bed whilst this saga was being played out to the amusement of the midweek shoppers.

The local paper carried the story on its front page and what stood out for me was the statement that when he had tried to ring the managing director at the furniture company, he was told “the M.D. does not talk to customers” That being the case, what do you think aspiring executives feel they need to do to reach the pinnacle in that company?

Well, not speaking to customers would

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Customer

be high on the list. As I said it starts at the top.

So what has all this got to do with the British Computer Society? Well whilst I was working with them, I was able to observe a research project that was taking place in the IT industry. It was a project aimed at determining the behaviour characteristics of top IT directors. The rationale behind the project came from within the IT industry and was ignited by the feeling that IT directors are not always sufficiently influential at the senior boardroom level to get the IT message across.

This got my ears pricked up because it mirrors exactly what I continually hear coming from customer service professionals. The thought behind the project was that if it was possible to determine the characteristics or behaviours of leading IT directors, it would be easier to develop future leaders to that level thereby raising the standard and ultimately providing enough IT directors of the right kind to strengthen the IT message at the very top of the organisation.

How may I help you?

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As the project began to unfurl and the research became published, I was sufficiently encouraged by the enthusiasm and interest shown by the IT community to discuss with the research company, Glowinkowski International, the possibility of running a parallel project for customer service leaders.

The result is that I have linked with David Physick of Glowinkowski to develop the Customer Service Directors’ Competency Framework. The aim is to develop a behavioural competency framework for senior service leaders, including customer service directors, customer relations directors and heads of departments in these areas.

At this stage it is important that the Glowinkowski definition of competency, for the purpose of this research is understood. They use the original definition of the word as “characteristic behaviours associated with organisational success�

If we can define the characteristic behaviours of successful customer service lead-

The management here is so proactive

Customer

ers, then we know what to look for and develop as we recruit, train, coach and inspire the customer service leaders of tomorrow. For certain, we are going to need them because, in today’s commercial world, service levels will increasingly be the differentiating value that will determine success for the majority of organisations.

The research being carried out has two main strands. The first is quantitative and the second is qualitative. The quantitative research comprises of a questionnaire and to make sure that the outcome is sound, we need as many service leaders as possible to complete the document (on-line, or by hand). Already we have well over 100 completed questionnaires, enough to provide reliable information.

There is still time to add to the data and any reader who is a customer service leader is invited to contact me to participate. As an incentive, it is worth pointing out that all participants will receive a free copy of the research findings which will otherwise only be available on a commercial basis from Glowinkowski International.

The second and qualitative part of the research comprises a series of focus groups. The intention of the focus groups is to examine again the question of “what are the behavioural competencies associated with superior performance as a customer service leader?”. Although the questions asked at the focus groups are couched within these terms and extended to address some of the points that have been thrown up by the early returned questionnaires, the discussions have been far-ranging and have provoked and stimulated strong and intense discussions.

Early Findings Although it is too early to draw final and firm conclusions from the initial inputs, and the final report is unlikely to be avail-

able until the New Year, already some interesting insights are emerging. The research shows that outstanding customer service leaders: are keen students of customer service and look beyond the boundaries of their own industry sector

This being so, the timing of the Customer Service Directors’ Competency framework is absolutely right. The results are awaited with keen anticipation but meantime there is still an opportunity to become involved. S

spend time, effort and energy in making sure that they continue to be in touch with customers on a regular basis – meeting them and making sure that they are aware of customer feelings and trends are proactive also in dealing with customers, approaching them – rather than just waiting for the dissatisfied customers with whom they feel that they are obliged to deal make sure that they are involved in organisational strategy and that the customer is at the centre of this are tenacious in pursuing their goals for customers but are also flexible in their approach, keeping an open mind for changing dynamics learn from service failures, rather than just fixing the problem, thereby ensuring future service improvement

Don Hales is a keynote speaker, workshop presenter, consultant and author on customer issues.

He focuses on financial aspects, leadership and effective strategies to improve bottom line results: all backed with an in-depth knowledge of case studies of outstanding award winning customer service practices from the National Customer Service Awards. Don’s highly acclaimed new book “Wow! That’s What I Call Service” (co-authored with Derek Williams) is now available. (£12.99 post-free from Don at address below). He can be contacted on don.hales@questmedia.com or on 07850 874120

are committed to development of staff, including themselves, to improve the overall customer experience understand the value associated with service, enabling them to quantify the costs and benefits of service improvements when seeking investment by the organisation Service remains the most crucial area for most companies to develop if they are to continue to survive. The importance of the subject is such that the development of customer service leaders is vital to the well being of UK commerce and industry.

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Fast Guide

Blogging

Surely you’ve heard of it by now?

Popular Blogs

More Reading

Unless you’ve been secreted away on a remote desert island for the past 10 years, the chances are you’ll at least have come across the term ‘blog’. To say that blogs and blogging have become more popular is a touch of an understatement, a quick check on Google, reveals over 1.3 billion references and growing by the second!

The term blog originates from the phrase ‘web log’ and these were the original online journals or diaries that were the forerunners of today’s blogs. Blogging is now well established as a method of communicating with different audiences. It isn’t all individuals either, many businesses are now blogging (with varying degrees of success) and there are even examples of full time bloggers employed by large companies.

A quick online search reveals that there is pretty much a blog for every occasion.

There are dedicated blog search engines such as Technorati and even the mighty Google now has a dedicated search facility for blogs. It can be a fascinating exercise to see what other people are writing about your sector or industry. The top 100 blogs in the world (ranked by popularity) are nearly all American in origin, but there are lots of UK bloggers who are

In the foreword to what is probably one of the best books on the topic (Naked Conversations by Scoble & Israel) Tom Peters says “Business blogging works. It is of monumental importance”. If you want to read more on the subject, this book is definitely worth a look.

Alternatively, if you’re looking for a book that will give you more practical instruction then “Blogging for Dummies” is an excellent introduction.

EVEN THE OLD MEDIA ARE GETTING IN ON THE ACT WITH THE ONLINE VERSIONS OF THE TIMES AND THE GUARDIAN DEDICATING LOTS OF SPACE ON THEIR SITES TO BLOGGING

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How To Get Started

gaining in popularity. Even the “old” media are getting in on the act with the online versions of The Times and The Guardian dedicating lots of space on their sites to blogging.

There are lots of different ways to start blogging and hundreds of different packages to look at. The following are worth taking a look at: Typepad – one of the leading blogging solutions for business and professionals.

Small monthly fee. www.typepad.com Wordpress – another very popular package and it’s free! www.wordpress.org Blogger – another popular blogging solution, part of the Google group and also free. www.blogger.com

Blogging for Business The most commonly asked question is ‘why should I bother having a blog for my business?’. The answer is quite simply, it’s another opportunity to engage with your customers. The best business blogs are those that genuinely discuss topics of interest to your customers. Remember, you have to make your blog interesting and relevant enough for people to want to subscribe to it and keep coming back. If all you do is announce new products or offers on your blog, you will probably find that you don’t get many visitors at all.

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Watch out for the Stakeholder blog arriving soon! S

Book Review

Cogent Publishing

Customer Satisfaction: The customer experience through the customer’s eyes

By Nigel Hill, Greg Roche and Rachel Allen

Customer Satisfaction - for the real world There’s certainly been a need for a book that addresses the ‘need-to-know’ areas of Customer Satisfaction Measurement for new and experienced managers alike. Many managers seem to inherit piecemeal Customer Satisfaction Measurement systems when they take on a new role, or just as commonly, they inherit no system at all! Whatever situation you find yourself in, it’s good to be able to get up to speed on this sometimes complex topic quickly. The book certainly has the feel of being written for practitioners rather than academics with an emphasis on taking action and practical steps to implementing the elements of a Customer Satisfaction Measurement system.

That isn’t to say that the theoretical coverage isn’t here, in fact there’s a quite detailed explanation underpinning the practical steps, but you can leave that to read later and still get all of the practical points.

Comprehensive Coverage Taking a logical and comprehensive tour through the Customer Satisfaction landscape, the book covers pretty much everything most managers will ever need to know on the subject.

The first chapter ‘Dispelling The Myths’ is particularly interesting reading as it deals with most of the ‘pub knowledge’ beliefs around the topic and equips the reader nicely for any arguments that might take place regarding the importance of measuring Customer Satisfaction.

Subsequent chapters then go through the essential s of methodology (useful if you’ve forgotten a lot of the terms), deciding what questions to ask, how to go about sampling and then how to collect the data. Underlining its practical nature, the latter half of the book deals with analysing your customer satisfaction data and

how to take action from it. There’s also a good explanation of more advanced techniques (see below) and how to involve your employees and customers in the whole process.

The book is very nicely structured, with lots of guidance to key points and important information; this actually makes it a very easy and accessible read, despite dealing with some technical aspects of customer satisfaction. There are plenty of explanations and real-life examples throughout the whole book and some great nuggets of information. For example, do you realise that you’re probably employing ‘voodoo polls’ somewhere in your organisation or that ‘the friendly martian’ can be very useful in focus groups? Thought not!

Latest Ideas Customer Satisfaction is a very fast moving topic and there are lots of new ideas and concepts coming into the arena. This title seems to have covered most of them including customer experience, emotional versus rational customer relationships, delighting or wowing the customer, net promoter score, customer experience modelling and the financial impacts of customer satisfaction and loyalty. Again, although the book covers much ground on these topics, it does so in a readable and accessible way, so you’ll certainly be up to speed with the latest thinking on this topic. It’s also refreshing that the book is written by British authors, as that avoids the trap which seems to mean that many titles fail to translate successfully across the Atlantic.

More Advanced Practitioners If you are already running some form of Customer Satisfaction Measurement in your organisation, you’ll no doubt find the introduc-

tory sections a useful refresher, but the coverage of more advanced topics will undoubtedly be of most interest. Techniques covered include the implications of asymmetry in customer satisfaction data, customer experience modelling, decision tree analysis, loyalty modelling, relative perceived value, index versus single question reliability and customer lifetime value. As is becoming more common, the book comes with its own website www.customersatisfactionbook.com. The authors invite comment and discussion, so it could be the perfect place to pose that tricky customer satisfaction question that you have!

Summary Customer Satisfaction: The customer experience through the customer’s eyes is a very comprehensive book with a real-world bias.

The authors’ backgrounds as specialists in this area mean that the topics are covered comprehensively, but more importantly in an accessible style. If you work in this area, this is the one book you definitely need as it is undoubtedly the most advanced and up to date book on the subject. S

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November 2007 Stakeholder

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Book Review

The 60 Second Leader: Everything You Need to Know About Leadership, in 60 Second Bites

Capstone

By Phil Dourado

Phil seems to have cornered the market in small, excellent value, highly readable management books. The idea with this one is that there are simply far too many books on leadership and management; if you want to have any time left in which to lead, then you can't possibly read all of them. Phil's new book breaks leadership down into 30 key principles, tackling each one in its own short chapter. The 30 individual elements are grouped into 5 categories:

The 30 Elements of Leadership Personal (self) leadership Failure Connection Intuition Luck Decisions Optimism Leading the organisation Strategy Execution Competition Management Action Change Leading people Questions Motivation Attention Engagement Stories Targets Distributed leadership Innovation Leading from the middle Culture Frontline leadership(1) Customers Frontline leadership(2) Great leadership Ego Love Humility Presence Fear Legacy Each of the 30 "essential elements of leadership" distils the best bits from prominent

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books and thinkers into three or four compactly written pages. This brevity probably means that a sceptic won't be won round, but that's not really the point. This is a book for leaders who are already sold on most of the ideas in it, but want a source of inspiration and ideas. It's ideal use is to prompt yourself to take action.

These chapters are both broken up and supported by "leadership tales" illustrating aspects of leadership with a particular case study. These inspirational stories feature the usual cast of CEOs and commentators (Branson, Semler, Eisner etc), and there is a good mixture of classic tales and ones you won't have heard before. My personal favourite, entitled "unexpected leaders", is about a ten year old girl named Tilly Smith who saved nearly a hundred people by insisting to her parents that a tsunami was on the way as they sat on a Thai beach in December 2004. The point? "…we must encourage leaders to emerge from unexpected places and recognise them when they do.

In flexible organisations different people will lead at different times…".

Phil finishes the book with a section entitled "where next?". Apparently research shows that we put learning into action best if we "focus in regular 10-15 minute sessions"; just enough time to read one chapter, think of something to do differently, and start doing it. This seems like a great way to use The 60 Second Leader—set aside 15 minutes a week (or a day!) to read a chapter and really do something about it. If you do that, I bet this book will make more changes to you and your organisation than any number of

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hours spent slogging away at weightier tomes on the train/in the bath.

"EXAMPLE IS ALL IN A LEADER. "THAT’S ALL LEADERSHIP IS." Aidan Halligan Phil clearly understands very well what matters for a leader. Even better, he has spotted a gap in the market for a book that is genuinely practical and focused on making change happen. Last, but not least, for people (like me) who are collectors of quotes and anecdotes this book is stuffed full of them.

This is an excellent read that resists the urge to over-complicate. Just because great leadership is rare, and perhaps difficult, doesn't mean that it's complicated.

Make this book part of your weekly regime, remind yourself what really matters, and promise to do something with what you learn. Best of all it's cheap (only £6 on Amazon) — buy two and give one to your boss! S

·

Leading edge research-Harvard Business School, Bath University/CIPD, world-wide study of professional firms.

·

World class case studies Marriott/Fairfield Inn, Prudential

Advertise here

Financial, Cisco Systems, Southwest Airlines

·

your training course

Results of research among delegates share and benchmark your practices (pre-briefing questionnaire)

·

Practical research tools and processes to take away

“I really enjoyed reading this book, the topics of which will be of extreme interest to HR practitioners and business leaders. Topics are approached in a systematic and balanced manner. I commend Raymond Robertson’s flexible attitude of recognising that one size does not fit all and that different circumstances will attract different reward solutions.”

The Strategic Reward Consultancy 3 Glebe Field, Almondsbury, Bristol BS32 4DL

Call Charlotte Ratcliffe on 0870 240 7885 or email info@stakeholdermagazine.com

Roberto Ponte Worldwide Compensation and Benefits and North EU Human Resources Manager Infineum International Ltd

Tel: 01454 618995 Fax: 01454 617614 email: team@strategicreward.com www.strategicreward.com

On the Stakeholder Satisfaction website you can now: Download your favourite articles from past issues of Stakeholder Satisfaction Subscribe to Stakeholder Satisfaction

Peak Performance Training was founded in 1995 by Rachel Davies and specialises in management training, particularly in the areas of customer service, team building and motivation.

For more information contact Rachel Davies at:

Please contact Anne-Marie Lose

AND MUCH MORE TO COME...

Visit: www.stakeholdermagazine.com now and register for access to all this information

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November 2007 Stakeholder

39

The Leadership Factor

Research Services

the

Satisfaction & Loyalty Research

leading edge of

More than training

satisfaction

Training courses are only part of our story, we also provide research services.

The UK’s No1 Satisfaction Research Company Conducting over 400 different satisfaction surveys each year Specialising since 1996 in the measurement and improvement of satisfaction and loyalty Offices in the UK, USA, Australia, France, Spain & Russia

and loyalty measurement techniques

What we can do for you We provide services in a number of areas around satisfaction measurement including:

Customer Satisfaction Surveys Employee Satisfaction Surveys Benchmarking We can provide as much or as little help as you require and we have our own teams and systems in place for the design and distribution of surveys by post, telephone, online or face to face.

What to do next To discuss your individual requirements, or to simply find out more please contact Charlotte or Martin The

T: 01484 467004 info@leadershipfactor.com

F A C T O R L E A D E R S I N S AT I S F AC T I O N M E A S U R E M E N T