29 January 2015

Improving service performance : Why complaints hold the key

It’s not breaking news to say that managers responsible for customer service are busy people with quite a lot on their plate. Managing day-to-day service performance in the dynamic, real-time world of customer contact can test the skills of both experienced hands and those new to service leadership.

This is before you’ve even opened your in-box to see the latest LinkedIn article on 5 steps to a better customer experience or answered that invitation from your boss to next week’s leadership strategy day on ‘doing more with less’. Sometimes, it’s not clear exactly where to start with service improvement.

Maybe that article in your reading list about eating elephants?  Or was it the one about getting ducks in a row? Instead, why not take a look at some practical steps to achieving service improvement results and see why complaints fit so well into the picture.

Be clear on what is meant by performance improvement


This might sound obvious, but it’s surprising how many organisations launch a flurry of improvement activity without a proper understanding of what they’re actually trying to do. It’s long been understood that organisations which provide a positive customer service experience enjoy greater customer loyalty [1] and lower negative word of mouth publicity [2] from dissatisfied customers.

That visionary goal of “by next financial year, we’ll deliver an X per cent increase in our customer experience using continuous improvement based on customer insights” may have received enthusiastic nods at the management away-day, but now you’re responsible for coming up with a coherent plan to make it happen.

And remember, furious activity is no substitute for understanding [3].

Let’s start by considering the typical activities that underpin business operations in any organisation delivering services or products to customers (below).

Price Perrott business cycle diagram
We all know reality is more complex than a simple theoretical diagram, but it’s helpful to remind ourselves of the context behind what makes an organisation’s customer service experience tick.

It’s this business cycle that means we need to consider the concepts of approaches like Systems Thinking.

In customer service, achieving performance improvement results requires an understanding of the inter-relationships between different parts of your operation and what will happen when you introduce a change. It’s not enough to just ‘furiously do something’ and hope for the best.

Whether you’re introducing planned changes from your strategy, or reacting to factors outside your control like customer behaviour, competitors or regulators, doing something in one part of your operation will have a consequence elsewhere in your business.

The combined results flow through to create your customers’ experience. Never has it been more important than now to remember plan – do – review.


Successful improvement changes require people to do things differently


Whatever your improvement plans, as soon as you begin you’ll inevitably meet a barrage of ‘why’ questions from people that are affected. This could be customers, staff or other third parties. Here’s just a few typical examples from virtually every customer service improvement project I’ve been involved with:
  •     Why are we doing this again?
  •        Why should I take part?
  •        Why does this matter to my job?
  •        Why will this help my customers?
  •        Why are you doing it this way not that way?
There’s a fundamental lesson about all improvement projects here – that change only happens when people take actions to do things differently. Being prepared to answer ‘why’ questions from the outset improves your project’s chances of achieving results, because you’re helping people to understand the practical implications of what the changes will mean for them.

A critical factor within your organisation is the need for managers to show leadership by example. Not only is a lack of leadership the number one reason for the failure of IT projects [4], in customer service environments the behaviour of employees is fundamentally linked to the messages they receive (and the actions they perceive) from their managers [5].

Without leadership by example you run a higher risk of the project meeting serious resistance.

Improvement results are driven by knowledge and insight from complaints


What does all this have to do with complaints? Here are three reasons why good complaints management is key to service improvement:
  1. Improvements should target the most painful or inefficient parts of the customers’ experience
  2. An open and well managed complaints operation quickly exposes real customer dissatisfaction
  3. Complaints provide clear case study evidence for analysing the root causes of systemic issues
Taken together, this means your complaints management operation acts as the feedback loop shown in the cycle diagram above. You may not need to commission that survey company to gather customers’ views, because your customers are already trying to tell you.

Complaints provide real data to identify the source of problems and give a measurable way of planning and assessing the results of service improvement changes. Quality management techniques like Lean Six Sigma are highly applicable [6] as implementation methods and we’ll look at how in a subsequent article.

But what does “best practice” look like in complaints?  Fortunately, there’s guidance to help with this in the form of an International Standard for Complaints Management – ISO 10002. In particular, the recently revised Australia and New Zealand variant (AS/NZ 10002:2014) has a highly practical focus and is derived from some of the world’s leading research and operational experience in the field.

Our next article in this series will take a good look at the new standard. For now, suffice to say that you need reliable complaints information to plan the best service improvement actions. To get reliable complaints information, you need an effective complaints management operation delivering insights and analysis you can trust.

After all, it’s what you’ll be pinning your business improvement targets on. I mean, you wouldn’t set out to sea with a leaky boat, would you?

Creating an action plan for service improvement


To help you start taking action, let’s summarise the key themes we’ve covered that you’ll need to bear in mind when putting together a service improvement plan:
  1. Customer experience is a function of your people, their attitudes and your processes
  2. People make improvement happen and they’ll follow the examples set by their leaders
  3. An organisation’s customer service is a ‘whole system model’. Changes in one area will have a ripple effect across other areas of your business, ending up in the customer experience.
  4. Complaints provide you with business insights that identify priorities for improvement, along with the case study data to analyse and address the root cause issues behind them.
These themes apply regardless of your industry sector and whether you’re a private business or a government funded organisation. If complaints are the key to service improvement, start by understanding how well your organisation currently performs at complaints management.

From there, you’ll be well placed to direct your limited budgets into the service improvement initiatives that tackle root cause problems across your organisation. That’s at the heart of any improvement strategy.

After all, furious activity is no substitute for understanding.

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If you’d like to know more about how your organisation can deliver a world class customer feedback experience, sign up for our next Complaints Improvement Workshop.

Price Perrott's Complaints Management Assessment will help you benchmark your employee culture against the latest ISO (AS/NZ) 10002:2014 standard for complaints management.

Contact us for an individual conversation.




[1] Andreassen (1999), Feinberg et al (1990)
[2] Blodgett et al (1993), p422
[3] Attributed to HH Williams,1858 – 1940
[4] Kappelman et al (1993)
[5] Luria et al (2009), p10
[6] Abreu et al (2012)






References

Andreassen, T., 1999. What Drives Customer Loyalty with Complaint Resolution? Journal of Service Research, 1(4), pp.324–332
Feinberg, R.A., Widdows, R. & Hirsch-Wyncott, M., 1990, Myth and reality in customer service: good and bad service sometimes leads to repurchase. Journal of Consumer Satisfaction, 3, pp.112–114.
Blodgett, J.G., Granbois, D.H. & Walters, R.G., 1993. The Effects of Perceived Justice on Complainants' Negative Word-of-Mouth Behavior and Repatronage Intentions. Journal of Retailing, 69, pp.399–428.
Kappelman, L.A., McKeeman, R. & Zhang, L., 2006. Early warning signs of IT project failure: The Dominant Dozen. Information Systems Management, 23(4), pp.31–36.
Luria, G., Gal, I. & Yagil, D., 2009. Employees' Willingness to Report Service Complaints. Journal of Service Research, pp.1–19.
Abreu, P., Sousa, S. & Lopes, I., 2012. Using Six Sigma to improve complaints handling. In World Congress on Engineering. London, pp. 1363–1368.

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1 comment:

  1. I appreciated all of the planning and strategizing that goes on in the background to help improve customer relations and customer service. I just wish more companies had a better follow through. There is room for improvement in all areas of customer service and the customer is always the one who suffers.

    ReplyDelete