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How to Become a Great Customer Company

THE PERENNIAL CRY FROM CEOS around the globe is that they are focused on their customers. It is their No. 1 mission, the critical job of their companies, and everything emanates from understanding what customers need and want and delivering on it. You may have said this yourself.

Somehow, this message hasnt sunk in because customers are having a more difficult time than ever getting service from the companies they do business with, regardless of how much they spend, how long theyve been a customer or how profitable they are. There is a fever pitch from customers using the power of the Internet to make their pain known. Web sites such as www.ripoffreport.com, www.planetfeedback.com and www.gethuman.com give customers a place to gripe and navigate their way to companies who can serve them better. And they are doing it actively, loudly and in great numbers. The number of visits to Rip-off Report is high in the millions and climbing every day!

One culprit is the corporate organization and how we act separately inside our functional areas or silos. As internal leaders of each silo report and recommend customer actions separately, CEOs react to the random issues landing at their feet, rather than focusing on key issues eroding customer experiences, loyalty and customer profitability.

For example, marketers in a highly regarded financial services company charged with improving customer loyalty sold their CEO a concept touted as a customer-assistance program, but it was completely inwardly focused. The goal was to upsell and cross-sell customers who called in for service help, regardless of who they were, why they were calling or how profitable or loyal they were. This gave the front line a case of priority whiplash. Just the week before, operators received impassioned training on how they should build personalized relationships and customer rapport with each call, even though the process caused longer call times (a tactic sold to the CEO a month earlier). But the lucrative incentive being paid out for the new marketing program was based on keeping calls to a talk-time limit, and on upselling customers, regardless of who they were. So, with one eye on the timer prompting them to end the call, the operators would try to build rapport. Then with talk-time dwindling, theyd rapid-fire offers to upsell and cross-sell. The result alienated some of their best customers who expected help from a company they were extremely loyal to, but instead got disappointing service. Not much increase in sales or growth in customer profitability resulted. In fact, customer goodwill declined.

Inspired customer leadership in the very best companies comes from an impassioned leader who has an instinct on where to take the business for customers, and absolute clarity on how to inspire the organization to make it happen. It was the personal mission of the person at the helm whose inspiration drives these businesses to where they are today. Lands End, for example, started in a humble walk-up building in Chicagos sailing hardware district and it was Gary Comers personal vision that moved the company forward. In fact, even as the company grew, he pulled it back to its roots saying, Think small, think one customer at a time … the rest will take care of itself. And it did.

Customer leaders have two traits that set them and their companies apart they have gut and guts. According to my book, Chief Customer Officer: Getting Past Lip Service to Passionate Action, heres what they have and what they do:

Gut leaders know the higher purpose they want to have for their customers. They have a sharpened radar for seeing whats right and wrong and whats getting in the way. They have a clear line of sight for the direction of the company. They have an internal compass that guides reactions to ideas and proposals, which they use to direct the customer relationship.

Leaders with guts absolutely will take the hill to get there. Customer priority and issues will be known, understood and thought through at all levels. Customer leaders need the guts of a salmon. The salmon goes head first against the current. It pushes on to its destination, unscathed by resistant forces. The salmon-like leader turns the company from facing itself to facing its customers. Such leaders use business meetings to challenge people to understand how what theyre doing affects the customer. They are not afraid to trade short-term profits for long-term gains with customers. They know how to explain the customer commitment to the board and the companys employees.

Taking a page from passionate customer leaders, take these 10 actions to put your personal stamp on your relationship with customers:

1. Take the time to know absolutely what you want to be to your customers. Your business otherwise will continue to run on autopilot with each of your operating areas (service, support, marketing, operations, sales, etc.) functioning without much real conversation about what it means to customers. Take the time to stew about it and gain the clarity of what greater purpose you are performing for your customers.

2. Communicate that purpose for your business. This may sound obvious, but its amazing how many companies have every part of their company defining what they do separately. Do this litmus test to see how connected your company is in knowing the higher mission they all collectively serve for your customers. The next 10 people you speak to, simply ask them; Whats your job? and Whats our collective job? Youll be surprised at the varied answers youll get. No wonder if you havent been the beacon telling them where youre headed, theyll chart their own courses.

3. Establish your own set of guidelines for how to treat customers. Consider the various dimensions of your business and make a set of statements about how each one of them should show up to customers. Be clear about what frame of reference should be used when making decisions about each dimension and what should be standards for customer treatment.

4. Listen to the front line and talk to customers regularly. The front-line staff is talking to your customers every day. On a regular basis, sit yourself down with them and ask what the key issues are. Write down the issues and assign someone to take care of the major ones. Then personally reach out to customers to understand at a greater level of granularity what is happening so you know what to do about it. Then fix the issues. This is simple, it works, and it puts your skin in the game. When you let your company and customers know your direct understanding and involvement in resolving these issues, it will have an impact and it will set a standard and an example people will emulate.

5. Track and trend complaints and do something about it. Beyond the conversations, give the front-line staff a tool to track issues. By doing this, you have an immediate hand on the throttle management device for steering your company. As you track this feedback month after month and year after year, the trends will help you understand in more detail what your customer needs are. Most importantly, this type of discipline will let you take real-time action on resolving issues that may be sending your customers away. I know that everyone wants to survey their customers, but they are exhausted by the request, especially since no apparent action follows. If you must survey to get that statistical data, you will find that it validates what you already have found out by trending and tracking customer complaints. In fact, if your survey tells you things you dont know, youre too distant from your customers and in a precarious position in your relationships with them.

6. Know your customer segments and how their needs vary. Especially where resources are tight, you will want to cluster your customers by how much revenue they generate and their profitability. From these clusters, you should identify commonalities in what they need from you. The intention is never to underserve those with lesser profitability potential, but you absolutely must be aware of those power players on whom your livelihood may be most dependent. Once you know these clusters, you can come up with creative ways for serving them by allocating resources in sync with financial outcomes. For example, you may have a wide number of smaller customers who, rather than sending out an individual to call on them separately, can be brought together for a networking event that benefits them all and reduces your cost for servicing them.

7. Give the front line the training, support and tools to do its job. The front line is the company to your customers. This is not the place to cut costs. Ensure that you allocate ample resources to ensure that the front line has what it needs to give your customers what they need. This means ample communication from you (that wont cost a thing), but also the right training, skill development and technology resources. Theres nothing worse, for example, than allowing a customer to wait while their sales or service rep struggles with inadequate support materials or customer information systems.

8. Conduct a quarterly or monthly customer-loss review meeting. This is a potent profit-management technique you can begin today. To prep for this meeting, compile the data on customer defections so that you know which customers you lost and why. In addition, assign your key lieutenants to make outbound calls to up to 10 customers who have left during the month or quarter to find out why they left. Theres nothing quite as compelling as a customer speaking right to someone who has accountability for making something happen. Customers often are so amazed by the effort that they consider trying the company again. After the calls have been completed, convene the meeting to discuss whats happening with your customers and what is driving them away. In that meeting, get a consensus on how to prioritize the issues and assign accountability. Use subsequent loss-review meetings to track progress on resolving issues, continuing the process of calling customers who defected.

9. Keep track of your customers. You should know the flow of your customers in and out of your business. The easiest way to rank customers is in terms of a score people can follow and you can keep top of mind. Find a way to figure out how to track, discuss and manage these characteristics about your customers. These are called Guerrilla Metrics in my book because they help you power the customer onto your business agenda. For example, a business-to-business company was counting the number of customer accounts but not the flow or the quality. The sales team was led by an ex-fighter pilot who sent off the sales force on what they actually called speed kills. They were fired up to get as many customers as they could, as fast as they could. But they werent keeping track of the difference in the value of business each new customer would bring. To them, one unit was one unit; customers had become widgets. Each speed kill carried the same weight on the tote board used to measure success. The sales team exceeded their goal for new customer accounts that year, but sales became a drag on profits, which actually declined. This is because they didnt focus on the profitability of customer accounts, just the number of them. And no one actively identified, prioritized and eliminated issues driving profitable customers out the door.

10. Finally, take the actions that are good for your customers. Make clear decision decisions that put the customer first, then let EVERYONE know what they are. Your customers, your suppliers and, most importantly, your company all need to know that you are taking action and listening to the feedback that is coming in daily from your customers through inbound calls, through the Web and through conversations. People are looking to see if theres more behind the customer commitment than lip service. You need to prove that there is. You need to market hope. When you do this, youll see the tide turn.

Jeanne Bliss is the author of Chief Customer Officer: Getting Past Lip Service to Passionate Action. She runs CustomerBLISS, which helps leaders connect their companies for customer growth. Get a complimentary Reality Check Audit on your customer focus when you visit www.customerbliss.com.

Links
CustomerBLISS www.customerbliss.com


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