Tag Archives: customer-alignment

Bad Process. Bad Customer Service. Common Practice

Yesterday Bank of America put me through a very unpleasant but very common experience. Their ebanking center tried to pay my BofA card account out of a long-closed checking account. The payment was not made; they didn’t notify me of the problem; then I got a late notice and fee. Happens all too often – no big deal. But when I called to find out what happened and straighten things out, I reached a contact center just out of civilization’s reach. The agent tried persuading me I couldn’t enter my online account using the credentials I’ve used before, and I never could have. She was absolutely clueless. So I demanded a supervisor, got one, identified the problem, reversed the fee, etc., etc.

BofA’s problem is endemic. Companies hire raw, poorly trained front line agents who can’t resolve issues a high percentage of the time, either leaving customers angry or having to reroute them to a supervisor – and the companies believe they’re saving money. Any rudimentary process map showing frequencies and costs would blow their “belief” right out the window. Too bad Microsoft couldn’t patent this process, because then others wouldn’t be able to repeat it. But it’s like “monkey-see, monkey-do” out there (my apologies to any monkeys reading). Microsoft and other big call center players start this practice, and before long it’s standard fare.

Where are these companies’ brains? Guess I shouldn’t ask that in a PG blog.

Why Don’t Companies Base Head Count on Meeting Customer Requirements?

 

I just read two news articles this morning of the type that make me gnash my teeth and shake my head. Both involved Fortune companies planned to cut staff by the thousands based on bad financial results. Say what? To these companies, I ask, “Why were you carrying so much excess staff you could do without?”

Most service companies carry double-digit percentage excess staff. Likewise for product companies in their back and front office settings. How do I know? Process redesign, streamlining in particular, plays a primary role in helping clients meet and exceed customer requirements. And we constantly find excess staffing over-distributing decision-making authority, leading to employee disempowerment and creating excess bureaucracy, both of which drive customers nuts. Today’s customers want to deal with well-trained, empowered employees and as few of them as possible – and on the web an increasing percentage wants to research and order commodity goods without any personal contact.

So how does head count typically change after streamlining? By a negative 15% to 20%, in our experience. But rather than streamlining, most organizations throw people at problems, and the more they add the less efficient and effective work becomes. So instead of streamlining to create a win-win for both company and customers, they create lose-lose by overstaffing.

Why do they do this?

How Much Does Corporate Design Fight Customer-Centricity?

Historically, virtually all corporate entities have been designed from production/service delivery out (inside-out). And a few unlucky companies have been designed from accounting out (upside-down).  In either case, when companies try to redesign strategy and process from the customer in (outside-in), they run smack up against their organizational structures.

Inside-out and upside-down companies are aligned and managed around functions. Customer-centric (outside-in) companies are aligned and managed around customers. Unfortunately for customer-centricity, companies can’t get from A to B by throwing a switch. The journey is rough and risky, which is a core reason why most customer-centric companies either started that way or transitioned before they were fully formed.

Based on my experience, the alignment change issue stops more companies in their path to customer-centricity than even lack of executive leadership. Do you agree?

If you’d like to do a deeper dive on this topic here’s a new white paper (parts of which will be folded into the book).

http://www.h-ym.com/articles/Alignment.pdf

Book Research

Before asking leading questions (and using your answers), I should share that I’ve started a new book exploring the inherent conflict of interest between buyers and sellers and how it should influence customer-centricity and CEM. The working title is “I am Buyer. You Are Seller. That’s the Problem,” and I plan to solicit input using Linkedin, CustomerThink and my blog. If I want to quote someone directly, I’ll ask first.

First leading question: Is designing customer strategies and enabling process to suit “average” customers (customer models) consistent with customer-centricity and CEM – or should sellers be designing “process-on-demand” (term from my Linkedin colleague, Bob Starinsky) that accommodates each customer individually?

Are We Witnessing the “Half-Life” of Customer-Centricity?

The optimist in me says, “Probably not.” The realist in me suspects we are, for several reasons.

-Customers were initially grateful that many companies appeared to be searching for comity. However, buyers now appear to be moving through this phase, which I call “play nice.” Now they’re seeing through the many insincere seller efforts to look and sound more customer-centric and becoming more cynical and mistrustful of sellers than ever. Hence, an increasing percentage is no longer “playing nice.”
-Influenced not only by transacting business over the web but by not seeing the “what’s in it for them” from forming relationships with sellers, many buyers are trying to minimize contact with sellers, preferring efficiency over spending time interacting with sellers.
-The more latitude sellers give buyers to “have it their way,” the more idiosyncratic customer behavior becomes – to the point where finding common approaches to satisfying varied customer preferences is becoming very difficult. “Process-on-demand” (term coined by my colleague Bob Starinsky) is beginning to replace customer best practices.

I’ve gone into much more detail in a new white paper, titled, “After Customer-Centricity Comes…?” http://tinyurl.com/9huk63k

 

Please know in advance that I’ve “trampled over” a number of customer-centricity’s sacred cows, and even more of marketing’s. But please don’t shoot the messenger :-).

Is Customer-Centricity Already Irrelevant?

I’m right now in the process of writing a full article on this topic, which is how I get to the bottom of perplexing questions.  The article is far from done. In fact, I want to read portions of Doc Searl’s excellent new book, “The Intention Economy,” before I wrap it. However, I can already share what I’m seeing through customer lenses.

Customer-centricity is a halfway point between win-lose favoring sellers and win-lose favoring buyers, with the latter being a place business absolutely doesn’t want to go. So in a sense, business (at least enlightened portions) created customer-centricity to stop customers from “crossing over to the dark side.” But a sizeable percentage of customers in developed economies have already pierced the customer-centric line of defense – and have crossed over. And a lot more are coming.

The consequence? Companies have to be prepared to become “customer-reactive” and deal with customers who don’t give a rat’s a** about whether or not sellers survive. Very different business model than customer-centricity.

Are others seeing the same trend lines?

Selective Customer-Centricity – Is Ikea Shooting Itself in the Foot?

Many in the group have commented about “what’s customer-centric for one segment might not be for another.” Perhaps the most commonly cited example is Ryan Air, which helps the knapsack crowd get around dirt cheap while utterly offending many suitcase carriers. Recently, I’ve run into another example, but the seller advantages aren’t as clear cut.

Recently, my wife and I sold our house of many years and moved into an urban condo. While I wouldn’t stick even our college-aged son with Ikea furniture, they do offer good deals on “safe” items including bookshelves and cabinet/drawer pulls. So I went in there, which I’m generally loathe to do. And once again I discovered that Ikea does not want my business.

First, Ikea is overdue for ADA (Americans with Disabilities Act) penalties. While I’m still erect, hip and back arthritis can make walking long distances difficult. That can make shopping at Ikea very painful, because once you enter the store, they make you walk in bewildering loops past every piece of merchandise on display before you can find an exit – and the only way out is past the registers (unless you turn back early and retrace your steps). The day I went to buy drawer and cabinet hardware I hurt like hell before uncomfortably standing forever in a seemingly interminable checkout line, especially because I had to walk another mile to find a clerk who could find the online catalog items we’d selected. Of course, I could have stayed in my La-Z-Boy if they’d take orders over the web, but that doesn’t bring you face-to-face with every damn item they sell. No accommodations whatsoever for an aging Boomer, never mind someone disabled.

But then came bookcase shopping. First, walk the entire circular route to see items to make sure they’re right. Then, keep walking to the furniture warehouse, where they expect you to load your own cart (but only after walking another mile at the direction of three different clerks to find one). And then one unit is 80 pounds, and Ikea expects you to bring your own help, if you need it, to lift it onto the cart. They will pull the items and deliver them for a hefty charge. But if you want to get them into your car, so your ripped son can unload them, you’re outta luck. After two shoulder surgeries, I ain’t messin’ with 80 pounds. Next to impossible for anyone older, never mind someone actually disabled.

But hey, I’m just an ordinary aging boomer. And there’s the proverbial 78 million pound elephant (the Boomer generation) walking across the time line towards or past the day when they can no longer comfortably handle a shopping experience designed for younger, sounder of body generations. I do believe Ikea is shooting itself in the foot. What about you?

The Hazards of Heading a Customer-Centric Company

Last week I wrote about the difficulties Best Buy CEO Brian Dunn was having meeting customer expectations, which had been raised by previous CEO and visionary Brad Anderson, who retired. Today, Dunn is done. Victim of being a nuts and bolts operating manager for a company that needed another visionary. Best Buy badly needed someone at the helm committed to meeting and exceeding customer expectations – including shifting BB’s operating model to meet shifting customer preferences. An interim CEO from the Board will take command while the company searches for a new CEO.

What do you think chances are Best Buy knows what to look for this time?

Best Buy – Too Much Space or Too Few Customers?

Best Buy just announced a plan to take out 50 stores, 400 HQ jobs and many thousands of store employees. They blame the need to scale down on overbuilding. I blame it on shabby treatment of customers that’s driven buyers out the doors.

Just several years ago many of us were singing the praises of Best Buy and CEO Richard Anderson for taking a customer-eye view of their business – including extensive staff training and upgrading retail floor talent. But then Anderson retired, they hired Brian Dunn as new CEO, and Dunn’s first pronouncements addressed profitability and efficiency, not customers. The writing was on the wall. Back to the old, company-centric business model – which today’s customers aren’t buying, just as they’re not buying Best Buy’s merchandise.

Sure enough, lots of formerly loyal customers, myself included, now use Best buy as a store of last resort. So they’re not lying about being overbuilt. But they aren’t fessing up to the true reason. And so they’ll double down on what they’re doing wrong and morph into “Worst Buy.” It was good shopping with you – while customer-centric thinking lasted.

The Death of a Category – Coming Soon to Your Industry?


Have you ever watched an entire business category slide below the horizon? I first did while too young to understand what I was watching – as passenger and mixed passenger/freight railroads didn’t make the bend. But even when I hit graduate school years later the “Penn Central” case study was still very current. Classic example of not changing business model in the face of rapid environmental change.

Since then we’ve all seen more sectors fade from sight. Everything from neighborhood full service groceries; to specialty consumer a/v stores; to big, powerful cars that could pass everything but a gas station; and more recently, we’ve witnessed the demise of mid-sized airlines, mid-priced jewelers plus shoe store and bookstore chains. And we’re now inexorably heading towards the end of client-server computing (outside of extreme speed enterprise stuff) and even PCs themselves.

But what’s next? Are we ready for online niche categories to fade away, just as brick and mortar business categories did? I believe online travel services are toast, as are a plethora of social media services. And Are we ready to turn traditional healthcare on its ear? I suspect we’re reaching the end of medical clinics staffed by FPs and GPs. Likewise physical tax preparation services and perhaps all tax preparation services.  A simplified tax code would send most of the accounting industry packing.

So what’s on your candidate list for extinction?