Innovative Express

"Improving effectiveness by making the complex simple and making the simple work!"

November-December 2007

In this issue:

Quick Update: What Clients Want
Water coolers, pay phones, and customer service
Personally Speaking...

As 2007 draws to a close, I hope that this last newsletter of the year find you well.

This month's newsletter wonders if customer service is going the way of water coolers and pay phones and putting on a disappearing act.

Inspired to agree, disagree, or otherwise comment? Have an interesting or humorous story to share? I hope that you will let me know your thoughts.

Wishing you joy and peace during the upcoming holiday season and much happiness in the New Year!

Abhay Padgaonkar
President, Innovative Solutions Consulting, LLC

Quick Update: What Clients Want

Ann Gynn, Managing Editor of The Leading Edge magazine interviewed me recently for an upcoming article on "What Clients Want."

Ann wanted to write about technical and non-technical ways in which companies can analyze data and collect information about their clients in order to build greater loyalty.

We discussed CHAID (Chi-squared Automatic Interaction Detector) as a highly useful data-mining technique to segment the data and see the underlying patterns. Software programs such as AnswerTree from SPSS allow a visual analysis using CHAID in the form of a tree diagram to separate the wheat from the chaff.

We also discussed how, particularly in the B2B environment, objective, third-party, and holistic interviews with key decision-makers can extremely helpful in extracting rich and actionable information- something mass client satisfaction surveys rarely can.

The article is slated to come out in early 2008.

Water coolers, pay phones, and customer service

Maybe it's me, but things have changed a bit lately when it comes to customer service. I cannot help but think that it is going the way of water coolers and pay phones. They are still around, but hardly anyone uses them anymore. It's like Yogi Berra once said, "It's so crowded, nobody goes there anymore!"

But first some historical perspective:

A couple of profound events occurred back in 1776. First, the United States became independent. And Adam Smith's book The Wealth of Nations was published. The latter may seem like a trivial event, but as Dr. Eamonn Butler, Director of The Adam Smith Institute said, "The Wealth of Nations changed our understanding of the economic world just as Newton's Principia changed our understanding of the physical world and Darwin's Origin of Species."

This is because things we take for granted today weren't so intuitively obvious back then. Dr. Butler says, "This remarkable book was published in 1776, at a time when the power of free trade and competition as stimulants to innovation and progress was scarcely understood. Governments granted monopolies and gave subsidies to protect their own merchants, farmers and manufacturers against 'unfair' competition. The guilds operated stern local cartels: artisans of one town were prevented from travelling to another to find work. Local and national laws forbade the use of new, labour-saving machinery."

In this groundbreaking book, Adam Smith first established the rights of the consumer. He said, "Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer."

Modern Consumerism

Fast forward to 1965, when a Princeton and Harvard Law School educated Ralph Nader, published a book called Unsafe at Any Speed. This incident catapulted auto safety into the public spotlight, and rallied public opinion to push through dozens of reforms in business, government, and various professions. His political aspirations aside, the range of issues that Nader has addressed is broad: consumer protection, nuclear power safety and renewable energy, food and drug safety, air and water pollution, product liability protection, and consumer reforms in insurance, banking, pension law, and telecommunications.

Soon US corporations realized that the consumer was actually their friend, and if they provided better service to the customers, the better they will reward them with business, loyalty, referrals, and profits. Books like The Loyalty Effect by Fred Reichheld sang the virtues and touted the virtuous cycle that client loyalty generates as the hidden force behind wroth, profits, and lasting value.

Until recently, I think! Now the forces of rampant globalization, cutthroat competition, and mindless outsourcing have left customer service as a nice-to-have rather than a must-have in the eyes of many big corporations.

A recent McKinsey article called A Better Hospital Experience says, "New research indicates that US patients and physicians are more and more likely to base their choice of hospital on nonclinical aspects of a visit---like convenience and amenities. Yet few hospitals have the marketing skills, the organizational structure, or the operating approach needed to deliver a distinctive experience in the way that retailing and hospitality companies do." One of the key findings of this research is that 20 percent of a patient's choice of hospital is based on its clinical reputation. Remarkably, about 41 percent is based on the nonclinical patient experience.

My recent experience with British Airways will explain what I mean.

No Can Help!

I had bought a ticket to go to India, and because of a last-minute change in business plans I wanted to change it. I went online and made the change, paid the change fee, and printed confirmation that the change had taken place. I felt pretty good at how easy the whole process had been-until I went back online to make sure the change had taken place!

Despite appearing like the change was accepted and payment received, the old itinerary was still showing in the system-online and offline! I talked to 7-8 different people in Reservations, Executive Club, and Online departments from 9-5 all day. Nobody was able to help. To make things worse, they were rude, inflexible, and unsympathetic to my plight and to the fact that I had spent 7-8 hours on the phone and online for what should have worked in the first place in about 5 minutes.

The supervisors, in particular, were one of the worst! The person who ultimately helped me change the reservation was not much better. She refused to honor the price that was being shown online. I felt that they were part of an outsourcing company who didn't really care. It was a highly disappointing and disturbing experience from an airline with BA's stature.

Talk Is Cheap

Contrary to what BA claims, "Whether customers are in the air or on the ground, British Airways takes pride in providing a full service experience," they wouldn't let me talk to anyone higher-up or in customer service. BA also says, "The well being of our customers is extremely important to us. Every year, we listen to the views of over 600,000 customers through our surveys."

Then next day, I received an email inviting me "to take a few moments to tell us about your experience with British Airways web support." I figured, "Finally! I can tell someone about my lousy experience and they will do something about it."

From the email, I could tell that it was sent from PRC - a call center company based in Florida that I have actually visited. The online survey was fairly straightforward:

How quickly did you get through to a Web support representative?
The Web Support representative was very courteous & knowledgeable.
The assistance received from the Web support representative helped resolve my issue.
What was your reason for calling Web support?
Overall how satisfied are you with our Web support representative?
Please tell us how we could improve the quality of our Web support service.

I took great pains to explain what had gone wrong, provided the booking reference number, the problem I had repeatedly run into including the names of people (I seriously doubted that they were real since I talked with a "Sophia" and "Michelle" with distinctive Indian accents) and a desire for them to call and NOT send a form letter.

Within 5 minutes of completion of the survey, I got another form email as follows:

"Thank you for taking the time to contact us. The volume of correspondence from our customers is much higher than usual. We have recruited more people to help, but it may still take us up to 28 days to reply to you. We have set up your file and the reference number can be found above. While you are waiting for a reply from us there is no need to re-send your email. Our aim is to ensure we make contact with you as quickly as we can. We are very grateful for your patience."

Regards
British Airways Customer Relations

28 days? Are you kidding me? By the way, that's the last I've heard from them! Thank goodness, it wasn't anything urgent!

Answering the Call

Doesn't it make you wonder why the volume of correspondence from their customers is much higher than usual?

There are four things I see missing in this new customer service ethos:

Integrity: Integrity is when you do what say. Increasingly, companies are saying one thing and doing another. There is incongruity between taking pride in providing a full service experience and needing up to 28 days to reply to customer correspondence.
Empathy: Empathy is not necessarily agreeing with the person on the phone, but walking a step or two in their shoes. It goes a long way in reducing conflicts. But when agents are being rewarded for keeping their AHT (Average Handle Time) down, who has got time for empathy?
Flexibility: Flexibility allows you to find creative solutions. It enables reasonable people find the middle ground. But if the agents are being evaluated on their productivity (i.e. the number of calls they take), flexibility is the first to go out the window.
Authority: Ultimately, one has to have authority to do what makes sense under the circumstance. Increasingly, there is so little trust placed in the frontline people and their hands are tied so tightly (especially if they are in an outsourced call center in some other continent) that they cannot help even of they want to.

I have to wonder. Are companies not looking for these qualities when hiring people in customer service jobs, reinforcing them through training, giving them sufficient authority and freedom to do their jobs properly, and monitoring and rewarding these behaviors? Or are they burning out even otherwise good people so they stop behaving the way they are supposed to?

Not just British Air, but I have had similar bad experiences with Symantec, Cox, and Priceline recently. I am not sure about you, but these kinds of encounters leave me wanting more.

Bottom Line: Whatever happened to promoting the interest of the consumer?

Personally Speaking...

It's bad enough when you have a flight that leaves at 2 AM. It's worse when there is a 2-year old boy behind your seats kicking and screaming--literally! It's even more infuriating when the parents go deaf on you, which sets the child off even more. Such was my luck when I was coming back from Mumbai back to Phoenix via Kuala Lumpur, Taipei, and LA. Dirty looks from me and a fellow passenger along with his pleadings that he was "trying to get some sleep" fell on deaf ears. The torture continued relentlessly.

I was determined to do something about it. I simply could not take this for another 12 hours. The prospects of reforming this child (or his parents) were very dim indeed. So I decided to beat a hasty retreat. During the stop-over in Taipei, I went to the gate agent and begged her to give me another window seat. I was afraid of language difficulties in communicating the urgency of my need. Fortunately, she not only understood, but was also very nice. Maybe it was my bloodshot eyes. Instead of giving me a window seat, she moved me to a middle section that was completely empty.

I slept like a baby the rest of the way!

Bottom Line: Never underestimate the soothing power of excellent customer service.

Disclaimer: "This written advice is absolutely intended to be used, and if used under expert supervision is known to improve organizational and individual effectiveness substantially."