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The Service Factor during Economic Turbulence

Written by: Dr. Rick Johnson

Article Overview: Improving and maintaining good customer service is not an exciting endeavor. It involves detailed study and steadfast execution rather than temporary brilliance or inspiration. Therefore, customer service improvement is fundamentally an effort of continuous improvement. You must develop a basic competency in process improvement to attain and sustain high levels of customer service. This means that it is absolutely critical during tough economic times that you don’t make the mistake of cutting resources that support service excellence in your attempt to control operational costs.

The Service Factor during Economic Turbulence

The primary focus of your company's operations should always be on having uniformly excellent customer service. However, service excellence is mandatory during turbulent economic times. We define customer service as "doing what you say you will do". This involves setting customer expectations and then delivering on them. When the "fish were jumping in the boat", you could get away with less than world class service. Today, anything less than service excellence is just not acceptable.

Improving and maintaining good customer service is not an exciting endeavor. It involves detailed study and steadfast execution rather than temporary brilliance or inspiration. Therefore, customer service improvement is fundamentally an effort of continuous improvement. You must develop a basic competency in process improvement to attain and sustain high levels of customer service. This means that it is absolutely critical during tough economic times that you don't make the mistake of cutting resources that support service excellence in your attempt to control operational costs.

It is strongly recommended that you create a detailed, documented process flow of what really happens in this area. This requires "walking through" the actual processes and asking a lot of questions. It's common for direct managers to have an idea about how a process should work without really understanding how it actually works. Often, a clear description of the real process makes the problem (or solution) almost obvious.

When you identify a bottleneck try to trace back from it to find the underlying or "core" problem. This simple technique helps you avoid treating symptoms instead of causes. For example, slow payments by your customers may be traced to invoicing errors, which in turn may be caused by incorrect pricing when the order is taken, which, finally, is the result of poor pricing guidelines.

Often, the most fundamental cause of an operational problem involves organizational or emotional barriers rather than technical or procedural ones. Profit covers many sins; Sins that may have been ignored when the fish were jumping in the boat.

Prioritizing Improvements

After you've identified a set of candidates for improvement it is tempting to attack many of them at once. However, experience shows that attempting to address more than a few major problem areas at the same time can be ineffective and even counterproductive. Most organizations don't have extra staff just waiting around for more work; especially the very talented people that you need to tackle a new initiative. This is especially true during tough economic times which may have dictated a reduction in force. This means that any new initiative will detract from your day-to-day business or other concurrent initiatives. Finally, companies often find that, after correcting primary problems, the secondary problems are completely different from those identified in the original analysis.

Designing Solutions

There are a variety of sound methods for designing solutions to operational problems. As stated earlier, the single most important element of solution design is to clearly define the underlying problem. It usually helps to state the problem or issue in a single sentence so that your entire project team has the same level of clarity on the issue. Three of the most useful methods are: brainstorming, best practices and streamlining principles.

Brainstorming is a way of leveraging the creativity of a team to get better ideas. It is most powerful when the following guidelines are followed:

• Use a knowledgeable facilitator who is not directly involved in the process being discussed.
• Create a list of different considerations or aspects of the problem to stimulate thinking.
• Allow no criticism (even mild or joking) of any input. There are no bad ideas.
• Let ideas build on each other - this is the power of the team participation.
• Take a short break after the idea generation session before proceeding with qualifying the ideas. But be sure to qualify ideas during the same meeting into those which are clearly ineffective or undesirable, those which are clearly effective and desirable, and those which require further investigation.

Simply stated, "best practices" are business operations that are commonly used by financially successful companies. The identification and study of best practices is now widespread and has contributed to significant operational improvements in many industries. This powerful tool originated from a simple, almost obvious premise: at some level, most business organizations do the same things. Therefore, by examining those organizations that do these common processes extremely well, we can quickly find ways to improve our own business. Significantly, best practices offer a way to learn from any organization in any industry, provided that both organizations share a "common process." Here are some guidelines to using best practices effectively:

• Remember that they are only correlated with good performance - be sure to use them as ideas for solutions rather than relying on them to fix problems that are specific to your company.
• Good sources for best practices include the industry press, trade associations, peers in other markets, information from suppliers and customers, and general business literature.
• Never blindly adopt a practice, even from a direct competitor, until you know exactly how it will work in your organization.

Finally, the principles of streamlining (Process Reengineering) can often help you discover process improvements. Streamlining refers to the act of removing steps and time from business processes. Because time usually equates to money, streamlining can often lead to significant bottom line improvements. The following are a summary of these principles:

• Document the way the process really happens, not the way it should happen.
• Evaluate every step in a process to see if it is really necessary.
• Avoid unnecessary hand-offs between people. This is typically a large source of error.
• When in doubt choose error reduction over speed. It is estimated that over 25% of the labor cost in the distribution industry is involved in correcting errors.
• Attempt to do steps in parallel (at the same time) rather than sequentially.
• Reduce variability processing time - even if all steps have the same average processing time, variability will always reduce overall throughput.

Executive level management must understand the changing role and importance of customer service operations to achieve the core mission of the business, i.e., customer retention, acquisition, satisfaction, and profitability. During economic crisis revenue production by customer retention, increased penetration and new account development is the only way to gain market share. World class service must become the foundation for these initiatives. It could mean the survival of the business.

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Article Tags: continuous improvement, customer service improvement, leadership, service excellence



Related Forum Posts
Re: Service Or Product? - I agree with starting a Service-based Business in the economy. Here is what I think is critical: 1. Researching that your Service business has a market. 2. Marketing the Service with as much leverage as possible. 3. Product-izing the Service (aka Package Expert Knowledge). This will only help elevate you as "the" expert in your niche and make you accessible to people in different price points.
Who Said Twitter Doesn't Work...? - Last month, the BBC World Service programme, The Strand, featured 21 year-old Icelandic pianist/composer Olafur Arnalds. Arnalds achieved extraordinary success through his internet-led project to compose 7 tunes in 7 days, post them on his website and then post links to it via TWITTER. As a result his website got thousands of visitors eager to listen to his music, catapulting him to fame and bringing his music to the attention of the BBC, who featured an interview with him on the World Service programme, The Strand! So who says Twitter doesn't work? (HINT: It does help if you have something uniquely your own that other people want to get hold of...)
Re: Ways to Boost Productivity - 1. Give Employees More Than a Paycheck 2. Provide Better eSupport Channels to Promote Self-Service 3. Complete your most dreaded tasks first thing in the morning. 4. Outsource as much as possible 5. . Turn off the TV.
Re: Service Or Product? - Service company always thrive in down economy. Let look at the advertising industies in any economy, you need to advertise your products or services even if you cannot afford any other things
Show the Benefits - Offer a free test drive of the Product or Service with a Money Back Guarantee - Take the Risk out. This will help them make the decision but you have to work with them to realize it by explicitly state the benefits they are receiving.


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