Monday, August 18, 2014

Why Do So Many Businesses Still Provide Terrible Customer Service?

‘Talk the talk’ is the easy part, very few can walk the talk!

Digital is the age of customer, being customer-centric is the ultimate goal for any forward-looking business today. But why do so many businesses still provide terrible customer service?

Lack of CEM strategy: CEM-Customer Experience Management is in most of companies’ corporate vocabulary now, however, ‘talk the talk’ is the easy part, very few can walk the talk, how to define CEM strtegic proposition, as the balancing act of looking to increase profit while keeping a customer-centric strategy of the business is perhaps tricky sometimes due to the lower business maturity.

Lack of capacity planning: Growing and not planning properly for additional customer service capacity is the usual cause. Most firms take on new clients and just load them up on current customer service staff. Also not replace people quick enough when they leave. Customer service is a human resource-intensive function that is a high cost arena for a business, with the aspects that are critical being high-quality manpower, logistics, trained technically sound staff, turnaround time, technology).

Pressure on immediate bottom-line: An organization may see an immediate boost to profits by employing more sales staff and selling more products, but fails to see that employing more effective customer service personnel will bring increased sales, service revenues and profits in the medium-term. The costs of scaling up the customer service outweigh the incremental competitive edge it provides to the business in comparison to product/service offering lead differentiation. It is perhaps the one area, that lacks the necessary agility for keeping abreast with customer expectation, due to the sheer cost of re-tooling the sales/service force.

Customer inertia: Some of the percentages in customer surveys shown as inertia means that many customers remain with existing suppliers as they fear change or know viable alternatives. It appears that more people have reasons to change, are aware that they can change, know of viable alternatives or can use particular websites to evaluate or advise of alternative suppliers, but the inertia makes many customers reluctant to make the move until a catastrophic event or major catalyst. Some customers continue with the same old supplier for many years whereas others change their suppliers (mobile phones, other technology, etc.) frequently. Similarly, many "say" they will pay more for service, but continue to patronize the low-cost providers - hence the continuing success of the so-called budget retailers!

Attitude makes difference: The attitude of "a bird in the hand is worth two in the bush" is fairly common in fast-moving industries where on-going service and relationship-building is sacrificed to selling the next fad.
The seriousness of the industry studies show that it takes six times more effort and cost to get a new customer than get a piece of new business from an existing customer.

Being customer-centric is a journey, you have to well balance the long term customer perspective with the short term profitability; gaining customer empathy, continue to cultivate the culture of innovation, improve business capability and grow customer service capacity, in order to walk the talk and optimize overall organizational maturity.


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