By Bill Pollock, president and chief research officer, The Service Council, www.theservicecouncil.com, email@example.com
Research shows that the focus of service organizations is shifting from cutting costs to improving customer service.
Over the past year, The Service Council has conducted four benchmark surveys covering several key aspects of service ranging from field service to service delivery automation, parts management/reverse logistics, and remote services. However, there has been a common thread among the results of these surveys — the major driver leading services organizations to focus on improving their overall business operations is customer demand for improved service delivery. This finding cuts across the board, cited by services organizations of all types, sizes, and vertical and geographic coverage.
While it may not necessarily seem like rocket science that the service community would respond in such a manner, it still represents a continuing trend to way back in the days when “customer service was king.”
Sure, over the past decade or two, other market drivers have temporarily surpassed customer service (or satisfaction) as the top factor. For several years, the “need to reduce operating costs” was the primary driver, soon after replaced by the “need to maintain costs” (that is, once the initial cost cuts had been made within the organization). However, in today’s uncertain economic environment, while escalating operating costs are still a major concern for virtually all organizations, at least there is some breathing space for organizations that have been fairly successful at refocusing their attention on what the service community’s original charter was — supporting the customer.
Will Improving Customer Service Increase Service Revenue?
There is another key trend that has also been in place over the past several years. In survey after survey, respondents cite the “ability to drive increased service revenues” as becoming more important. Earlier surveys typically placed this factor at only a plus-or-minus 20% response (compared to 52% to 66% for the need to improve customer service). However, in The Service Council’s most recent surveys, this response has since increased to the 28% to 35% range.
Satisfying the customer has historically fallen in and out of vogue — even in the service community. Among the hottest times for focusing on customer satisfaction over the past 25 years have been those periods in the 1990s when state, provincial, and national quality award programs (think TQM, ISO 900, and the Baldrige Award) were all the rage; later that same decade with the advent of CRM in its earliest stages (i.e. every company was conducting customer satisfaction surveys); and just about any time since, except during those pop-up and/or prolonged recessionary periods that we’re still all trying to emerge from at present.
The truth is, we’d be nowhere as a community without our customers. Of course, if we don’t contain costs and drive revenues, we’ll soon end up in the same place anyway. However, regardless of what else is impacting our respective businesses and whatever external market factors come crashing down at our doors, we must all remember to focus on delivering both what the customer wants and needs (yes, there is a difference!). However, merely offering what the customer requires is only half the battle. Service organizations must also strive to get the right message out, to the right audience(s), and through the right media or venues. Basically, simply understanding what the customer wants is admirable, but being able to effectively communicate that message to customers completes the cycle.
Remember — today’s customer requirements quickly turn into tomorrow’s customer expectations. Customers are continually raising the bar of what they expect from their services providers, and sometimes, cost-cutting programs may stand as major stumbling blocks for successfully accomplishing both sets of goals.
The Service Council’s ongoing research suggests that you should provide your customers with a regular venue for letting you know what they want, when they need it, and what their expectations are from you. Let’s face it — your customers represent your best source of marching orders for moving forward (that is, as long as your stakeholders and stockholders also get their say). However, this isn’t a competition — rather, a foundation for forging a partnership between the two most important entities supported by your organization — your internal staff, supply chain, and stakeholders; and your customers. Long live the king!