Breaking Bad Habits

Posted: 11/2003

Breaking Bad Habits
Simple Fixes to Common Customer Care Blunders

By Jim Marsh

Telecom players extol their commitments
to customer service. Every providers marketing materials profess to focus on
the customer and the advantages prospects will gain from being part of the
carriers family. Yet, once a service provider has gained a customer, it
turns its back and moves on to the next prospect.

Telecom companies talk the talk; they dont walk the walk.
Few telecom companies truly partner with their customers, save their largest
accounts. As price compression drives increasingly shrinking price advantages
from one provider to the next, relationships with customers become increasingly
important factors in a prospects decisions to switch carriers.

The irony is most providers recognize this dynamic and exploit
their competitors damaged or underdeveloped relationships as opportunities
for capturing business even as they suffer losses to those same competitors for
the same reasons.

Moreover, customers complaints about carriers have remained
the same through a myriad of customer satisfaction movements adopted within the
telecom industry from the total quality management wave of the 1980s to the
customer-first focus of today.

Then and now customers say:

  • My carrier doesnt listen to me!
  • I cant get them to understand my situation!
  • I cant get the same benefits or rates as a new

Translated, these all add up to My loyalty is taken for
granted! Not so coincidentally, the fundamentally broken provider-to-customer
communications structure has not changed. Barring a problem prompting a call to
customer service or a response to a past-due payment, the only communication
with a customer is a monthly bill. Is this superb customer relationship
management? We all know the answer: In many cases, customers are driven away or
at best, they are not given a reason to stay.

How do we break the cycle? The first step is identifying
common problems and correcting them.

Bad Habit: Attempting to upsell
customers at inappropriate times. Many companies attempt to upsell a customer
during calls into customer service or deal with collections departments. In both
of these cases, the customer is at least partially dissatisfied with the

Quick Fix: Instead of upselling in
these situations, providers should focus on problem resolution. The customer has
contacted the telecom company because there is a problem. Many companies talk
about onecall resolution, yet the representative on the phone seldom has a clue
about how to solve the problem. The representatives major purpose is to
record the problem and hope someone else fixes it.

Alternatively, when a problem is reported, get back to the
customer with a resolution. There is nothing worse than forcing a customer to
call back about the same problem or to ask about the status of the resolution.
Set expectations on the initial call, and update the customer if the
expectations are not going to be met. A simple follow-up call via an autodialer
with a message, for example, can assure the customer that fixing the problem is
important to you. When the problem is solved, let the customer know.
Communication with your customer using low-cost, yet effective measures will
improve satisfaction and show the customer your company cares.

Bad Habit: Processing customers with
outstanding billing problems through the collections cycle. All telecom
companies have billing problems that dont go away even with the most advanced
systems and platforms. Internally, one department hopes the other fixes it and
it continues through multiple billing cycles. At the same time, a customer with
an outstanding billing complaint is moved through the collections cycle, which
turns an irritated customer into an irate former customer.

Quick Fix: One way a telecom
provider can break the cycle is through communication, communication and
communication. This time, its not about communication with the customer, but
internal communication. Too often, even if the service organization is in contact with
the billing department, the collection group is left in the dark; they typically
find out about an ongoing billing problem from the customer. Collection organizations already segment how they treat
customers by their pay history. They need to add known billing issues to the
segmentation process. This can assist collectors by enabling them to focus on
nondisputed amounts. Working proactively with a customer can go a long way to
maintain a relationship while reducing outstanding receivables.

Bad Habit: Excluding customers from
promotions and better rate plans. Telecom providers constantly create new rate
plans and packages to lure new customers but do not offer these advantages to
their current customers. This shortsighted dynamic plagues nearly every telecom
company. The companies recognize creative plans are necessary to capture
competitors customers but they ignore the glaring reality that their own
customers are just as vulnerable to competitive copycats. Often, ignorance in
this area becomes out-and-out incompetence as customers that learn of the new
plans are denied the new rates or packages because they are for new
customers only or the customers are not given the discount retroactive to the
date it became available.

Quick Fix 1: This situation can be
addressed simply by giving retroactive credit or honoring the promotion for all
customers. The fact customers call in proves they are engaged and willing to
stay. Disregarding that fact can result in churn.

Quick Fix 2: Another approach is to proactively
offer the promotion and notify the customers with a thank you. The customers
may question the promotion, but the tone will be positive and may lead to
requests for other services or an upsell opportunity.

Bad Habit: Rejecting customers
through restrictive credit policies. Telecom providers offer promotions to bring
customers in, but when the prospective customers call for service, they are told
they must pay large deposits in order to have the service. The competitive
nature of the telecom industry no longer allows for the use of restrictive
credit policies.

The telecom industry followed the financial industry in using
credit history as a way to evaluate prospects, but has lost sight of the fact
that financial services firms manage the amount of credit offered while
accepting the majority of their prospects. In contrast, telecom providers allow
customers unlimited credit once approved and try to manage potential losses
during the install process with large deposits.

Quick Fix: If telecom providers were
interested in the managing the customer relationship, they would open the door
to their networks and manage credit as is done in the financial industry.

Working with customers throughout the customer life cycle
opens up revenue opportunities that are tossed aside by many of service
providers today. The relationship must be a partnership wherein both the
telecom services provider and the customer benefit. Telecom companies short-term revenue philosophy leads to
high rates of churn, higher acquisition costs and higher staffing costs.
Organizing the company around a total customer focus increases revenue and, more
importantly, profits.

Jim Marsh is a principal with The Marsh Group, a telecom
consulting firm focused on improving margins through enhanced receivables
management, revenue assurance and service initiatives. He can be reached at +1
314 378 2264 or

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