Getting board members to listen to customers. Get the right metrics
Introduction
Today the vast majority of companies will have a firm belief that they need to be increasingly customer focused in order to be competitive within their market place and that customer strategy development is vital. Evidence of this may be seen in companies’ annual reports, in their press releases and even in their communication to customers. Other indications may include significant investment in CRM systems, or in developing their call / contact centre capabilities and breadth. Yet with all of this strategic intent and capital investment, it would still appear to be extremely difficult to get senior management and board members to truly listen to customers, and then act on customer feedback. Why is this the case?
What are the right metrics?
At a recent conference there were Keynote Debates on two separate issues:
- whether the right things are being measured by call centres
- getting Board members to listen to customers
The two were tackled as separate subjects but I would suggest that one is the root cause of the other. Call centres are only just waking up to the fact that they are measuring the “wrong” things, but if they are to measure the “right” things these have to be related to the overall management of the business. In most companies, Board meetings are dominated by the financial statements, so unless the call centre can start to link its performance to these in a positive way, the Board will only ever see it on the cost side of the equation.
Experts on the Call Centre Expo panel blamed senior management for not understanding the value of the call centre, but surely it is time to stop this navel gazing and realise that the call centre benefits need to be sold. Every other service has to be sold, so what is so different about the call centre?
The Contact Centre Association has launched a benchmarking programme, which is an excellent approach to raising the standards within the industry. However, when you examine the metrics on which benchmarking is available, all of them are based around cost efficiency from the company’s perspective. They include the familiar:
- speed of call answering
- call duration
- queue time before calls being abandoned
These are traditional measures (because they are easily obtained) that allow managers to track ‘performance’ in terms of cost. However, none of them measure the customer’s actual experience, and none of them measure the benefit to the company overall. Customers are far less bothered about how long it was until the call was answered, within reason that is, than whether their reason for calling was satisfied. The Call Duration metric will then often provide conflict between a satisfactory conclusion and the targets contact centre staff are set.
Any management team reviewing their contact centre will surely not only want to know the cost side of the equation but also the benefit side. It may not be appropriate to purely measure revenue generated through this channel, but metrics such as:
- customer retention levels
- impact on levels of customer recommendations
- customer perception of the performance of the contact centre
- impact of the contact centre on the value delivered to the customer would at least provide a more balanced view.
Consider the Added Value
This consideration of added value to the customer is key. Customer Champions’ own research with 1,000 UK consumers found that those businesses that provided face-to-face customer contact were, in the eyes of the customer, providing much higher levels of customer service. Other recent surveys appear to support these findings: customer opinions of many brands worsen following communication with the contact centre, with financial services being the worst performers. (Source: Transversal)
A study into the Banking sector found that of the six methods most widely used for getting in touch with a bank, contact via a call centre was by far the least popular, with most people still preferring to do their banking face-to-face with a cashier at a local branch. (Source: Lorien)
A review of customer care standards in the UK concluded that although millions of pounds had been invested into sophisticated IT and telephone technology to handle customer issues, such technology often acted as a barrier to true customer / company communication. (Source: Customer Care Alliance)
So, with call centres measuring themselves on a cost efficiency basis but customers not seeing them as necessarily desirable channels for customer service, it would appear they have a major challenge if they are going to get management to use them as a listening post for their customers and bring Board members and customers closer together.
The Boardroom
When you look at the composition of the boardroom in large organisations you will generally find that people who have a financially orientated background dominate it. It is very rare to see a senior board member who has a Marketing or Customer Service background. This, combined with decades if not centuries of tradition of management schools teaching its students to measure everything on the bottom line, results in little space for the customer to be considered. Therefore, if the Voice of the Customer is to be heard it has to be translated into its positive impact upon the bottom line. The contact centre benchmarking survey will just encourage Board members to see contact centres as a cost, and not something that also has an impact on the other half of the equation.
Customer Champions’ own research shows that across Europe the vast majority of major companies gather customer feedback, yet only about 10% successfully deploy any actions based upon that feedback. The reason why? The data they are collecting cannot be related to the bottom line of the business and therefore when it comes to resource allocation to improve the customer experience the business case cannot be made.
Whether contact centres are a chosen customer support channel or not, there has to be a link between customer feedback and how the business is managed. Otherwise no resources will be made available to support the customer experience. In addition, in order to support the customer feedback, an organisation must also look towards its own internal metrics as these will help both interpret and anticipate customer reactions to the service being provided.
Customer Value Management is a tool that has supported a number of companies in being able to piece together this jigsaw and ensure customer feedback is able to add value to the bottom line of the business. Companies such as AT&T, Whirlpool and Vodafone have all seen benefits from this technique, the key being its ability to link:
- value from a customer’s perspective, and what drives that value
- the company’s relative performance when compared with the competition
- the link between the overall customer value and what that provides to the business in terms of market share, share of wallet, and ROI
- internal metrics that are customer focused and linked to the customer feedback.
The diagram below illustrates how this could become a form of balanced scorecard where everyone can see how their role impacts the customer, which in turn impacts the bottom line of the business. (The balanced scorecard (BSC) is a strategic performance management tool that can be used by managers to keep track of the execution of activities by staff within their control and monitor the consequences arising from these actions.)
Customer experience and ROI
One source of internal metrics that will support this approach may well be the call centre. But first of all the company needs to ensure that the metrics available are customer focused and not just internal cost management metrics, and not use metrics just because the data was automatically generated by their system.
Contact centres are not alone in this challenge in being able to justify their added value to the business. Marketing has always been an easy target when an organisation looks to draw in its expenditure when revenue is not achieving targets. Marketing has always complained that it is not an exact science, and that short-term withdrawal of marketing activity will lead to longer-term challenges in future revenue streams. Becoming increasingly frustrated with this argument, financially orientated management teams are now starting to look to their marketing departments to provide some form of Return on Marketing Investment. Although this may be possible in measuring specific campaign effectiveness, there is a level of marketing activity where this is not so easy, such as PR, sponsorship etc. Therefore, it may also be appropriate for the Marketing team to learn some of the lessons currently being faced by the contact centre and look to link its activity to customer feedback and hence into the bottom line of the business.
So, whether it is the call centre, the Marketing team, or any other customer-facing department, the bottom line is that their measurement of success, whether that be by using balanced scorecard, customer value management or any other tool, has to be related to the customer, and then translated to the bottom line of the business. Perhaps only then will board members not only hear the voice of the customer, but will listen and act upon it as well.
Take the next step
Customer Champions specialises in strategies to measure customer satisfaction – and strategies to implement actions based on that feedback. To discuss how best to measure the effectiveness of your customer-facing teams – and what to do with the results, please get in touch.