Creating and Managing Customer Satisfaction
Creating and Delivering Customer Satisfaction in the 21st Century
Customer satisfaction (or dissatisfaction) is something that impacts every organization. Those organizations with high customer satisfaction see the benefits everyday in terms of revenue, profitability, loyalty and customer growth. Those challenged with customer dissatisfaction struggle every day to stem the tide of dissatisfaction as it leaches away the very foundation of their business.
While customer satisfaction has always been an important part of successfully running a business the impact it has in the 21st century is far more pronounced then ever before. There are a number of reasons for this, reasons brought on by global changes in how we consume goods and services, and how we operate our businesses.
Globalization
We live in a “smaller” world today than ever before, smaller in the sense that it’s not difficult to be a global company and it’s quite common for even small organizations to do business on a global scale. Online purchasing and dramatically improved delivery services make it a relatively simple task for even the smallest organizations to “go global.” Low cost, easy to use services from companies like PayPal, EBay, Yahoo Stores, Amazon, Fedex, and UPS can make global business a reality in a matter of hours or days.
That means more competition than ever before and more competition produces three effects seriously impacting the importance of customer satisfaction.
1 – Price Pressure
The first effect is price pressure. The “small world” we now live in has pared profit margins down to the bone. Our competitive landscape includes competitors from all over the world and some of them are very good at minimizing the costs of goods and services.
2 – Increased Volume
The second effect is increased volume. With tight profit margins comes increased volume. The only way to offsite low profit margins is with more business. For two businesses offering the same products, the business today must do a far greater volume then the same company had to do ten years ago. In the 21st century, business is a volume game. We have to do more business with more customers than even before.
This also means that we must be able to service more customers than ever before. That can be a very significant strain on an organization. Not only do we need to service more customers but we have to do it at a lower cost than ever before. More volume, less cost. That may be an implicit benefit of assembly-line manufacturing but when it comes to servicing customers the challenge doesn’t decrease with volume, it increases with volume. It’s a challenge most businesses are not properly prepared to handle.
3 – Choice
The third effect is choice. Customers have more choice than even before. We are always in competition, and sometimes it seems that our competitive landscape changes overnight.
With choice comes challenge to loyalty and customer retention. When customers have multiple options they are aware of and can choose to meet their needs customer satisfaction must be consistent to keep customers loyal. We can’t have customer interactions that create dissatisfaction because it’s just too easy for our customers to take their business to someone else.
Bringing these three effects together we have the need for the business to operate at a higher volume, with decreased costs, while delivering consistent and compelling customer satisfaction.
And most of us are simply not geared up to handle the strain.
The Source of Customer Satisfaction
Yet there is an answer, one that comes from understanding the very source of customer satisfaction. We don’t have to “delight” our customers in every interaction – not at all. The source of customer satisfaction is much simpler than that. It is rooted in making our customers’ lives simpler, easier and more successful.
It all starts with the customer, and the “customer” is a person just like you and me. As people we can easily judge if an interaction with a business is satisfactory or not. It comes from the fact that we have an expectation for virtually any interaction that might occur between the business and us. Regardless of how the expectation is formed, it still exists.
So if the customer expects to pick up a phone to change a reservation for example, it shouldn’t take long to do that right? Dial the number, tell the person who answers about the change you need to make and you’re done.
Yet that is not how an interaction like changing a reservation typically works. We call but then must navigate the “customer interaction matrix” (for lack of anything better to call it) until we get to someone who can change our reservation for us. We are often asked to repeat information like our name, reservation number, what we want to change, and so on. We are in a process, and the process is more often than not completely out of control. Using Expedia just the other day for this purpose resulted in an hour and 15 minutes of customer time spent in the “process” to change one airline flight.
Yet from the customer perspective this is a very simple interaction that should only take a few minutes. Is this reasonable or are our customers expecting something from us that we cannot be expected to deliver?
It was reasonable a few years ago without the price pressure, volume requirement, and competitive landscape we have today. It was a commonly delivered customer experience. But if that is true why can’t we do the same thing today?
Because we have lost sight of our customers and the processes that touch our customers are completely out of control.
Gaining Control while Reducing Costs and Enhancing Service
How can we bring customer satisfaction back under our control? The answer lies in how our processes are aligned to delivering what our customers expect from us and in the reduction of process points of failure that make our processes susceptible to deviation from the experience we intend to deliver.
Moments of Truth are the cornerstone used to achieve this control over the quality and reliability of customer interactions. The processes that consistently deliver the highest customer satisfaction share two characteristics: the outcomes of theses processes are aligned to customer success (what we call successful customer outcomes) and the Moments of Truth in the processes that are not essential to customer interactions are engineered out of the process.
That sounds straightforward and even simple but there are still some considerations that must be brought into play.
The Outside-in Customer Perspective
Many of the practices and techniques already being used refer to the customer, the voice of the customer, the customer experience, and customer expectations. Yet the vast majority of these approaches remain inside-out. Getting aligned to the customer means we must develop a clear and personal understanding of what our customers want, what they care about and what they expect.
Within CEM this outside-in perspective gets a lot of attention. The SCO Mind Mapping technique of the IPAPI CEM Method™ builds the influencing context around the central concept of the Successful Customer Outcome culminating in a series of statements defining the actual SCO itself.
How important is this?
Take for example the process the customer is really in (one of the SCO Mind Map questions). If you think flying in a plane or buying a consumer good is the process the customer is in then you’re still stuck in the inside-out perspective.
Think about the process you are in when you fly on a plane or buy a new flat screen television. You’re in a complete travel process with an agenda or you’re in a personal enjoyment/entertainment process. The actual flight and television purchase process are only small components of the overall customer process that the customer is really engaged in.
However we get there, it is imperative we get to that outside-in perspective of the customer. Only then can we align process to create customer satisfaction. Otherwise our processes will not be focused on delivering what our customers consider to be successful to them.
Once we have the alignment we need to satisfy our customers we also need to optimize our processes for reliable delivery of customer success. This is where an insight comes into play that challenges some of the thinking we have used in the past.
Eliminating Causes rather than Fixing Effects
With alignment, the other piece of the customer satisfaction puzzle is the process behind the good or service. Past practice has focused on multiple iterations of reengineering problematic portions of these processes to make them more controllable and more reliable. We are attempting to fix the effects of these problematic process areas.
When we work to fix effects it is very difficult to avoid introducing new complexity to the process. If the process isn’t working the way we want, we add more controls to the process. This increases the process’s complexity.
With complexity come new places in the process where failure can now occur. It also creates the requirement for people to know more about the process in order for them to perform process activities and to support the infrastructure behind the process.
Eliminating causes takes the opposite approach. When seeking to improve customer satisfaction we look to minimize the Moments of Truth in the process by eliminating as many as we can.
Of course some Moments of Truth are necessary for customer-facing processes. But some are only needed to serve internal needs of our organization and others simply have no reason to exist at all. By challenging all of the Moments of Truth in the process and eliminating any that are not contributing to the Successful Customer Outcomes of our customers we can dramatically improve our customer satisfaction.
This shift to eliminating causes rather than fixing effects has another important benefit. By eliminating causes we are actually reducing the complexity of our processes and our organizations. The shift from fixing effects to eliminating causes is the step we must take if we are going to successful reduce the complexity of our organizations to a manageable and controllable level.
