All posts by Mike Bird

If we don’t trust our own people, why should our customers?

3491629234_bb118fe645_oA gap in trust

When customers complain, they expect that the people to whom they speak will be able to handle it. But this can only happen if our organisations trust customer service agents  to use their judgement, initiative and discretion to do so.

But this is rare.

How do we know it’s rare?

Because too many times the agent has to hide behind phrases like: “…it’s our policy, I’m afraid,” or “…these are the only options I can offer you,” or “…let me speak to my supervisor.”

In other words, our people could resolve the problem, but our policy and procedures get in the way.

Why do we do this?  Because we don’t trust our people.

  • We don’t trust them to do the right thing, so we constrain them by procedures.
  • We don’t trust them to do what is necessary to fix things, so we require them to escalate to supervisors.
  • We don’t trust them to make the right decisions, so we remove their discretion.

Our agents become a barrier between the customer and resolution of their problem. Worse, agents know this, so they feel frustrated and grumpy.

Does the customer pick up on this? Of course they do.

So, instead of making things better for the customer, we make it more likely that we will make an already unhappy customer even more unhappy.

The trust trade-off

Yes, of course, there is a need to have consistent processes so that we can offer consistent standards of service quality.  And, yes, I know that service is a cost and we need to make sure that we manage our costs with discipline and attention.  And yes, of course, we know that if we give our agents free rein, we might incur liabilities and risks which may not be acceptable.

So we accept these constraints. And we require that our people work to them.

And by doing so, we assume that value we gain in meeting these needs outweighs the damage these constraints cause to trust: damage to our trust in our people, and damage to our customers’ trust in our brand.

And yet. And yet…

A different trust model

Is giving agents discretion over customer interactions very different from offering a quibble-free guarantee for returns as offered by (say) Marks and Spencers, Lands’ End or (most famously) Zappos?

Not in intent.  Yes, such guarantees open these organisations up to abuse, but their  success shows that losses through abuse are more than outweighed by the increase in brand perception, trust – and sales.

Perhaps we need to think about this trust thing differently.

So come on. If we want customers to trust us, then maybe we need to think about trusting the people we employ to work with customers to make things better.

Trust is earned – so let’s earn it.

(Image credit: George Grantham Bain Collection (Library of Congress), Senator Atlee Pomerene meets first US Secretary of Commerce, William Cox Redfield, c.1910). 

How we train our customers to go to our competitors

Angry customer

A customer complaint is a favour

Customers complain about every business.

If we are lucky, customers complain to us.  Then we can put things right, help fix their problem and learn things which make our business better.

If we are not so lucky, our customers complain to their friends, or to people they meet, or to their followers on social media.  The result? Our reputation is damaged,  we  lose revenues and we open the door to competitors to show our customers how much better they are.

We train customers not to complain to us

Why don’t customers complain to us? Because we train them not to.

Huh?

Let me explain some of the ways we do so:

We make it hard to complain
Many organisations seem to do their damnedest to make it hard for customers to complain.  Typically we do this to save money.  Most of the time this is a false economy.  Some examples:

  • We don’t make it clear to customers how they should communicate with us.
  • We make it hard for customers to contact a real person.
  • We require customers to fill in forms.
  • We require them to have their account number / service id number / customer reference number before we can help them.
  • We make them wait on hold.
  • We push them to use email (which is slower) and hide our service telephone numbers.

All of these measures stop customers complaining. Result? They (and their sales revenues) go elsewhere.

We are slow to respond
We seemed to move fast enough when we were selling our product to the customer, didn’t we? So why don’t so many organisations respond as quickly to a complaint? Sure, we may have excuses:

  • Perhaps we don’t want to talk to them before we have sorted everything out.
  • Perhaps we are having trouble working out who should be dealing with the complaint.
  • Or, perhaps, we don’t know who in our organisation has the job of keeping the customer informed.

Customers don’t care why we’re slow.  They just want it fixed – NOW. If we don’t show the same sense of urgency as they are feeling, we are showing that we don’t care.

When a complaint disappears into a black hole, we cannot be surprised if we have lost the customer by the time the complaint emerges.

We respond in ways which do not respect the customer
(Warning: linked article contains profanity)

Customers making a complaint are unhappy.  They are often angry. Often, this is the fault of something we have done or failed to do.  And they have bought things from us in good faith.

At the very least, we should treat them with respect. What does respect for the customer look like?

  • It means listening to the customer; showing that we have heard them.
  • It means we don’t make them repeat themselves.
  • It means we keep our promises  – to look into their problem or to speak to a colleague, or to put it right.
  • It means we don’t make promises we can’t keep.

And, above all, it means treating the customer as a person, and treating them as we would want to be treated.

We treat the customer as a suspect
All too often customer services go wrong because they have been designed from the outset to treat the customer with suspicion.

The result is a customer experience based on one or more of these assumptions:

  • We haven’t made a mistake, you have.
    “No-one else has complained.”
  • Our products aren’t stupid, you are.
    The instruction on paragraph 6.4.2 of the user manual is quite clear: to restore the service you have to hold the product upside down and press reset button on the underside for between 4 and 7 seconds. You mean haven’t done that?
  • We think you’re trying to cheat us.
    Yes, I know that this is our product and it shouldn’t be broken like that, but unless you have your receipt we can’t help you“.
  • We think you’re lying.
    The system can’t crash like that. Are you sure that’s all you were doing?”

Occasionally, of course, customers do behave badly; but if we start from here, the experience we offer our unhappy customers is very likely to make them feel worse.

Even if we fix the problem, we are likely to lose the customer.

It is much better to think about helping customers on the assumption that they are correct and that they have a valid reason for complaint.

After all, something has  made them want to get in touch, so something about what we are doing must be wrong.

Moreover, a complaining customer is one who is engaged – isn’t that what most of our companies want? Engagement with the customer?

Why not begin instead by designing our service operation from the assumption that we want to help people?

Then, after we have done this, we can put in place some reasonable safeguards, just in case the problem really is on the customer side.

But let’s stop doing it the wrong way round.

Think afresh about complaints

We need to think about complaints differently.  A customer who complains is giving us a gift.

They are giving us another chance to get their custom; they are giving us a chance to restore – or maybe enhance – our reputation; and they are giving us a chance to learn from their experience to make things better for others.

It’s a gift we need to be better at taking.

(Image credit: Lythia Scott Eiler, US National Archive)

Five customer experience lessons from fringe theatre

Stage set of The Bevellers, Citizens Theatre, Glasgow, 2007

The fringe of experience

A long time ago, I directed a range of fringe theatre productions.

As a training ground for management or innovation, it could not be bettered. Consider what we had to do: select a cast and crew, motivate them around a vision, handle multiple egos under stress, capitalise on a diverse range of talent of every sort, generate and build on new ideas, conduct marketing, PR and sales campaigns and deliver something which we hoped would be wonderful.

And all by a fixed and imminent deadline: first night.

A Brazilian challenge

One production required that we interrogate a reformed murderer in a Brazilian police cell, have a dinner party in a Sao Paulo penthouse, attend a US evangelical revival at a jungle plantation, and have helicopter gunships attack a native village in the Amazonian rainforest.

Did I mention this was fringe theatre?  Our vision may have been limitless but our budgets were trivial. And so we struggled as the scale of our vision foundered on the rocks of penury.

A change in perspective

In first weeks of rehearsal, we focused on the script and tried to think of ways of making the production real.  But we got nowhere.  The cast was frustrated, the crew even more so.  People were fractious and unhappy.

First night loomed like an iceberg in the night, getting ever closer.

Then, in a blinding flash of the obvious, everything became much easier.

What was different? We stopped thinking about making the production real.

Instead, we started thinking about the experience which we wanted our customers, the audience, to have. What did we want them to feel? To think? To take away?

Thinking like this, from the audience in, rather than from the production out, unlocked our creativity.  Suggestion, not realism, became our driver.

  • The prison cell became one man lit by a single light in the darkness, shining through bars.
  • We painted the black interior of the studio theatre – set and auditorium – with foliage and vines like a jungle so that the audience entered the rainforest as soon as they came through the doors.
  • We placed the dinner party table on a dais in the middle of the stage and lit the background dimly so that the rainforest was only hinted in the shadows.
  • For the plantation, we lit both the dais and the rainforest, placing it in the jungle.
  • And we turned the lights of the helicopters onto the audience and played the sound of machine guns with the bass turned up to insane levels so the audience heard gunfire through their ears and felt it through the floor.

Total cost of the set? £200.

We opened on first night with a slick, professional production that was very well received.

Innovating success

Five lessons from my theatre experience have stood me in good stead in business and innovation ever since.

  • The greatest creativity comes from the greatest constraints.
    Three things govern all projects: time, cost and performance.  If time is fixed and costs are limited, then the only way to achieve breakthrough performance is through creativity and innovation.  Having limits drives creativity.
  • Think from the customer inwards, not from the product outwards.
    We only got traction once we started thinking from the audience inwards.  Our only arbiter of success is the effect on the customer, not the features of our product. What do we want the customer to think, to feel, to take away? Having these as our goals frees us to be creative.
  • Recruit for attitude and energy.
    We chose people for our production not only for their talent but for their enthusiasm and willingness to try.  We only succeeded because all of us – cast, crew and production – contributed to the creative process. As a result we generated many more ideas than we could use, so we could pick the best ones.
  • Leadership is about trust.
    The Director may have a vision for a show, even if s/he does not quite yet know how this vision will be realised.  The Director has to trust the cast, crew and production team to come up with good solutions to the many, many unanswered questions with which any production begins.   They in turn have to trust the Director to make the right decisions about which ideas will work. And it is only by trusting each other that they find ways to make them work.
  • Nothing drives creativity more than urgency.
    First night is a fixed and unforgiving deadline.  Such deadlines offer an imperative focus for a team.  Knowing that a deadline is real, and that it matters that the deadline is met, drives the delivery of new ideas better than anything else.

In my experience, when these drivers have been in place, I have only ever seen business innovation projects succeed. Where I have seen innovation failure – or deliver mediocrity, which is worse – one or more of these factors has been missing.

Always.

How about you?  If you are innovating for customers, do you recognise these? Let me know what you think.

(Image credit:  Blurredyvonne at en.wikipedia, under the Creative Commons Attribution-Share Alike 3.0 Unported license).

Buccaneers, banks and the customer experience.

A new market

Imagine for a moment that we make swords for a living.  We need a market for our  product.  Where are the opportunities?  After extensive market research (in our local cinema and some classic books) we find our target customer segment.

641px-Pyle_pirate_captain

Pirates.

A dynamic and exciting market.

Needs? Simple enough: a blade to carry between their teeth as they swing onboard a victim’s ship and something to parry other swords during spectacular duels.

But a standard cutlass already does this job pretty well.  If we try to compete just by selling these, then pirates will just choose the cheapest ones.  And we can’t compete on price with low-cost blacksmiths working on the Barbary Coast.

We need pirates to see our swords as better than those of our competitors. Do we need to offer a better sword?  Perhaps something incorporating the latest technology?

Perhaps a multifunctional sword?

Swiss Army Sword

We don’t know.

We need to know what matters to these buccaneers. What are their problems?  Their aspirations?  How can our swords can help them address these?  And how can they do so do so in ways which pirates value and our competitors find hard to copy?

Market insight

So we blow the rest of our market research on more movie tickets and popcorn.

What do we find? Pirates are fundamentally conservative and don’t want radical new sword designs.  They don’t want the equivalent of a sword iPad or a swiss army sword.

Other pirates would laugh at them.

Robert Newton as Long John Silver

Worse, so would their victims.

Is our venture doomed?

Not in the least.  For this finding shows us a real customer need that we can meet.

Pirates don’t just want a sword which slashes through the air;  they want to look good. A pirate has to look…dashing.

Errol Flynn as Captain Blood

They want others to tell stories about their exploits.  Sea voyages, even for pirates, are long, and stories told during endless night watches become legends told in taverns on shore.

And every pirate wants to be a legend.

A unique customer experience

And so we see that our swords have to be special.  Sharper than anyone else’s, with blades black as midnight, maybe, with handles encrusted with cabuchons and rubies and trimmed with gold.

Each as unique as its dashing and charismatic owner. Each a sword fit for a legend.

And each sword has to be challenging to get, so that each owner not only gets their sword, but a tale as well.

In short, we need to offer our pirates not only a distinctive product, but a unique customer experience.

So we select our distribution channels very carefully.   Caves on obscure islands, perhaps, or at the top of distant mountains. Then we throw in some traps, some quicksand and some fire swamps for good measure.

We prepare to go to market with a below-the-line PR budget to plant rumours of mysterious and wondrous swords in taverns, and above-the-line marketing through publication of obscure and blood-stained treasure maps (strictly limited edition).

Treasure map

And we make sure that the price for each sword is at least a treasure chest full of gold doubloons.

So now we know how we are going to get rich.

A time for thinking of risks

And it is at this point that we begin to think about the risks.

What kinds of risks? Pirates aren’t particularly trustworthy, so we’ll need to make it hard for them to double-cross us. We’ll need the ability to check treasure chests for poison needles among the doubloons. We’ll need good protection for our supply lines.

We will do all these things and more, but we do so knowing that the thing that matters is the customer experience we offer and how it meets their needs.

And while we act to address these risks, we don’t lose sight of what we are in business to do, or what our customers want, or the business model we have designed around meeting the needs of our customers by giving them a unique customer experience.

We think about our customers and how we will do business – and then we seek to manage the risks.

…And this is why banks will never get the customer experience right.

Banks begin with risk

Most businesses succeed by thinking about customers and the opportunities which these customers represent.  They look for ways to help customers overcome their problems and achieve their aspirations. They try to align what their businesses do with what their customers want.

When businesses do this well, they become customer-centric businesses; when they do this badly, they find it hard to keep customers and grow.

Most businesses – except banks.

Banks begin, not by understanding customer needs and aspirations, but by considering customers as risks.  They begin by assuming that customers will lose the money that banks make available to them, either through fraud or theft or poor money management or bad investment.

So when they consider the services they offer or the customer needs they will meet, banks start by seeking to minimise the risk which their customers pose.

So they make it hard for customers to become customers, because each new customer is a risk.  They make it difficult to change between products as changing products carries a risk that something will go wrong.

Where possible, they try to offset such risks, usually through fees or charges.  In effect, they ask customers to pay to cover the risk of their own untrustworthiness.

And they love being in the middle of deals as this enables them to offset risk at one end against risk at the other (and doubles their fees).

Bankers are proud of this. Speak to them and they tell you that a bank’s core competency is the quantification and management of risk. A key element of this is customer risk.

And so banks are hard-wired against innovation, because innovation requires both leaps of faith and a willingness to consider new ways of working with customers. These are, by definition, risky.

And, unlike the customer-centric businesses to which we refer to earlier, banks, because of this mindset, cannot align their businesses with their customers; instead they require that customers align their businesses with the bank.

A matter of trust

Banks can’t help being like this.

It’s not their fault.

It’s just that no matter what they do, they can never become customer-centric.

This is the effect of beginning with such risk thinking.  It means that banks, unlike every other business, start thinking about what they do from a different first principle:

Do not trust the customer.

This is why, for example, banks find it so hard to offer good customer service when things go wrong. As their business is predicated on pushing risk and liability onto the customer if something has gone wrong, the working assumption is that it is the customer’s fault.

And when things go systemically wrong (LIBOR, PPI, money-laundering, credit card insurance) it is only after huge fines and new laws that banks  accept that maybe it was their fault and that the customer might have been right after all. (Although they don’t really believe it).

Banks aren’t bad.  (Most) bankers aren’t evil people. They are trying to do the right thing, most of the time.

Pushing uphill

But when your business is designed from the ground up on the assumption that you can’t trust customers, making your business better by aligning yourselves better to customers is going to be difficult.

And so while there are now many people all over the World in banks doing great work to try to make the customer experience better, their prospects for long-term success are limited.

Because no matter what they do, the customer experiences they create can only be an overlay on a business designed not to trust customers.

Any successes they have can only be maintained by rigorous and sustained attention to the customer experience.  And when cost-cutting, new regulations, new systems or some other stress hits (as routinely happens in banks), their eye will leave the ball and the fundamental customer attitudes which underpin the banking model will kick back in and all their good progress will inevitably unwind.

Because, under stress, we all revert to the behaviours where we feel most in control and have greatest comfort. For banks, this is thinking about the customer as a source of risk.

A choice of experience

As far as I am concerned, I want to make things better for customers.  So, in the main,  I think I’d prefer to be in the sword business, selling to pirates.

And, thinking of the customer experience, wasn’t it a pirate who made famous the line: “As you wish*” ? – which is as perfect a customer experience philosophy as is possible in three words.

Yet for the life of me, I can’t think of any famous quotes from bankers about customers at all…

For a video of our target market, see here:

or here:

* Dread Pirate Roberts, in The Princess Bride.

(Image credit: Swiss Army Sword by Glenn Roberts, http://dribbble.com/shots/1207517-Swiss-Army-Sword?list=users)

Clocks. Not Calendars.

F18 breaking sound barrierThe Need for Speed, my latest guest post for HP Value Exchange, has just been published.  Read it to find out why I think that the speed of the technology organisation is a key factor in setting the competitive advantage of a business.

For customers, for colleagues, for growth: faster is better.

About the Business Value Exchange

The Business Value Exchange is an editorial Web site that focuses on presenting different perspectives on challenges faced by senior business and IT leaders, to help them drive more successful business outcomes.

4 steps to customer performance

Today, I am very pleased  to present a guest post by Jim Lucas of Lucavia.

US Army gym workout

Top performance is earned

Music, math, foreign language, computer programming. Have you ever wondered whether subjects like these can be learned or if you simply have to be “born with it”? A brief query shows a usual pattern. You’ll find a debate about the role of hard work and dedication versus natural talent, and then a consensus emerges. It takes hard work and dedication to become proficient or to master a subject (think: Malcolm Gladwell’s 10,000 hour rule). But to achieve at the highest levels requires more of the same plus a generous helping of natural talent and luck—where only the truly gifted achieve genius.

From a management point of view, simple knowledge of a subject is not interesting; only its application and performance matter.

Opinion is not knowledge

For example, think about retail customer service. Virtually every businessperson claims to know all about customer service and yet the quality and depth of customer service varies wildly between companies—and even within the same company from store to store and from experience to experience. So, why is it that customer service is so well understood and yet so poorly performed?

The answer is that most retail businesses do not have knowledge of customer service; they have opinions. What’s more, instead of performing customer service they constantly improvise, both as organizations and individuals. It is little wonder when an organization uses their 10,000 hours, practicing customer service 10,000 different ways, that customers perceive it as chaos.

Four steps to customer performance

The remedy to this situation is, as they say, simple to understand but difficult to master.

The first thing is to define customer service from your customer’s point of view.

The second thing is to write down the steps in your customer service experience including the standards of performance you demand for its proper execution.

Thirdly, systematize how you present this information to your staff—and be careful to select candidates for their aptitude to learn and to be passionate about delivering it.

And, finally, rehearse. One doesn’t become an Emma Kirby by performing only in front of a live audience at the Royal Opera House. You have to train, refine, and improve offstage to earn your standing ovations.

Jim Lucas and Lucavìa Consulting are located in the San Francisco Bay Area. They believe entrepreneurs need partners to help them turn their ideas into businesses.

(Image credit: Susan Huseman (USAG Stuttgart))

How to do customer experience: 3 ways to beat the grumps

Grump Street

Beware of the Grumps

When we want to change anything in an organisation, we will meet the Grumps. Grumps are colleagues who appear to support the project (and who may actually believe that they are acting in the project’s best interests) but whose presence is toxic to success.

The most telling sign that someone is a Grump is to note their effect on the energy of others.

If their presence adds to the energy of the team – if they are ‘radiators’* – then they are probably not Grumps.

If, however, their presence sucks the energy from the room – if they are ‘drains’ – we need to be careful.

How they speak is often a giveaway. Grumps are people on the ground who reveal themselves in meetings and emails and water-cooler conversations when they say things like:

“…I’m not saying this is a bad idea, but…”

“…We’ve tried this already and…”

“Let’s be realistic, here…”

“…we have to be careful not to throw the baby out with the bathwater…”

Or (as I have genuinely heard in more than one company):

“…we have to be careful not to trust customers too much…”

…and similar statements which have the facade of reason but really reflect fundamental antipathy.

Grump damage

Grumps slowly strangle customer experience projects.

They raise seemingly legitimate objections which are never about the intent of the project, always about the implementation.  Before long, the team is spending more time and energy managing concerns raised by Grumps and less in delivering the project.  Slowly, imperceptibly, Grumps force us to move our focus away from making things better for customers to trying to keep the Grumps happy.

And so the project fails – or more typically, fades away, as the effort needed to deliver something good gets brought down by the drag of managing the Grumps.

How to beat the Grumps

These three steps can help us beat the Grumps:

  1. Get them off the bus**  We don’t let a Grump be a member of our project team. It doesn’t matter how technically or managerially skilled they are, the drain on energy and time will not be worth it.  Much better to work with less-skilled colleagues who are radiators with the energy to succeed than let Grumps drain everyone’s momentum.
  2. Don’t give them a veto  It is a mistake to seek a buy-in from a Grump (or anyone else for that matter) unless their approval really matters to the success of the project.  For if they object, as a Grump will, we now either (a) divert resources and time to overcome their objections or (b) ignore their objections and go ahead, alienating them even more.  And if their approval is not needed, why did we seek it?  (Sigh: So many companies get this one wrong).
  3. Surround them with success  When we change to make things better for customers, the Grumps come last.  We begin by making the changes work with colleagues who are prepared to give them a go, ignoring the Grumps.  Once we have proven that the changes make a difference, then we make it work with the Grumps.  Grumps seek support for their belief that the project won’t succeed.  Proven success defuses such support.

Delivery de-Grumped

Good customer experience projects are all about leverage. They seek the places and strategies which yield maximum results in the fastest time. Grumps kill leverage, by forcing us to consider their objections instead of the customers, slow us down by distracting our attention and diverting our resources, and kill our projects by slowly sucking out our energy and momentum.

But if we can identify Grumps early and adopt the right practical strategies to prevent the damage they can cause, we remove one of the biggest barriers to customer experience project success.

Have you had the misfortune of working with Grumps?  What Grump warning signs have you seen? Let us know in the comments below.

*The idea of ‘Radiators’ and ‘Drains’ comes from Julian Fellowes in his book, Past Imperfect. I came across it cited in an article in Gretchen Rubin‘s blog, The Happiness Project.

**’Getting them off the bus’ is a CEO strategy recommended in Jim Collins’ excellent book, From Good to Great (p.56)

Image credit: David Stowell, licensed for reuse under the Creative Commons Attribution-ShareAlike 2.0 license.

Radiator image courtesy of Dan / FreeDigitalPhotos.net

Drain image courtesy of Winond / FreeDigitalPhotos.net

4 pillars of customer experience

PIllars of Creation, Large Magellanic Cloud, NASA

Four pillars

I set up MikeAndTheCustomer to help companies to make things better for customers.

Four principles which would drive what we do here.  I consider these to be the most important factors in shaping the customer experience.

To me, they pretty much describe the whole customer experience ball game.

  • Do what matters.
  • Do it right.
  • Do it fast.
  • Do it honourably.

Let me explain why I chose these principles to guide what we do.

Do what matters

In my view, no matter what business any of us are in, the customer experience we offer is determined by what our customers value and how we choose to address these.  These are the things that matter. Some examples:

  • If customers value getting in and out of a grocery store fast, then this speed of purchase matters to the customer experience
  • If customers value having a chiropractor talking with them to understand their issues, then perhaps understanding the customer matters more to the customer than speed.
  • And if hungover customers are buying their first coffee of the day, then maybe a quiet transaction with minimal conversation matters more to them than a cheery shop assistant who loudly wants them to have a great day with a bright smile.

This principle means not trying to make every customer experience brilliant, or memorable. It means instead paying attention to those that make a difference and figuring out how make these good for the customer.  And, after all, isn’t this what motivates many of us – to make a difference?

Do it right  

Whatever we do – buy, sell, deliver, support – we have to do it right.  Who determines what is  right? The customer.  Our customers are the arbiters of what we do, and if we do it right, we deliver the value which they expect.

This means that when our customers change, or evolve, or want new things, we take the trouble to learn with them so that we continue to do it right.

To do so, we have to be with our customers, learning with them, and about them, as much as we can.

Doing it right also means doing it as efficiently, consistently and systematically as possible.  That way we minimise error, we minimise costs, we maximise speed and we maximise the ability, as we grow, to have colleagues do it right as well.

Do it fast

I honestly believe that speed is the single most important factor in turning customer experience into a competitive advantage.

If we can deliver what the customer wants, instantly, then that means we can impress the customer with our service, we can find out from them straightaway if we are on the money and if we are not, we can fix it immediately.

The speed with which we deliver is the speed at which we learn.  The faster we do both, the better we will be, and the better will be the customer’s experience.

Do it honourably

This one needs a little more explanation..

I wanted a way a capture the spirit of good customer experience that did not involve telling stories about the virtues of  Zappos or Nordstrom or John Lewis.  Unless we work for one of these paragons of customer service (or, sometimes, even if we do) the effect of such stories is just to make the reader feel guilty that they aren’t doing better

The more I thought about it, and the more I recalled the companies I knew who really try to make a difference for their customers, the more I realised that the essence of good customer experience is about one thing. It is about being honourable.

What do I mean by honourable?  I mean this:

  • Honourable is about good manners and courtesy.
  • Honourable is about only making promises we can keep, and keeping them – as people used to say, it is about keeping our word.
  • Honourable is about doing our best for our customers (and our colleagues, and our suppliers).
  • Honourable is about being honest about what we will, and what we won’t, do.
  • Honourable is about respecting our customers, our colleagues, our suppliers and our competitors.
  • Honourable is about being proud of what we do, about what our colleagues do, about what our company does and the experience our customers receive.
  • Honourable is about caring when things don’t go well and doing our absolute best to put things right.
  • Honourable is about admitting we got it wrong and saying sorry – and making sure that it won’t happen again.
  • Honourable is about celebrating when our customers, our colleagues or our suppliers succeed.
  • Honourable is about selling honestly and pricing fairly.
  • Honourable is about helping.
  • Honorable is about holding ourselves to high standards because they are the right things to do.
  • Honourable is about aspiring to be better, all the time.

Honourable offers the key test when we think about doing a new thing: is what we are thinking of doing, and the way we are thinking of doing it, honourable?  Unless it is, then the answer is simple: we should not do it.

I believe that an organisation which follows these principles cannot help but offer a great, trusted, customer experience. What is more, they will continue to do so as customers, markets, technology and people change.

But this is just me.

What do you think?  Do you agree with me?  Or is there something I’ve missed, or with which you disagree?  Let me know.

This is important to me, and I would really value your comments or thoughts.

Thanks.

Mike

Image credit: The Pillars of Creation in the Large Magellanic Cloud, NASA

Sports Direct: the Ryanair of the High Street?

Sports Direct store in Crown PointPile ’em high, sell ’em cheap

Ian Golding, the customer experience consultant has an enviable CV and an excellent blog (which I strongly commend). Last month, he posted a great article about the customer experience offered by Sports Direct, a UK budget sporting goods store.

The point of his post was that Sports Direct offer a poor customer experience because, in effect, their goods are so cheap the customer experience doesn’t matter.

Ian also suggests that Sports Direct are effectively playing the same role in high street retail as Ryanair play in air travel.

A conscious choice

As regular readers of this blog will know, I have written about the Ryanair customer experience here and here.  I think that there may some significant differences in the ways in which they think about the customer experience when compared with Sports Direct.

I suspect that the biggest difference is that Ryanair understand the things which make the biggest difference for their customers.  As a result, they manage their customer experience to be good along a very few dimensions (on time, seen to be low-cost) and explicitly limited in others (no refunds) in order to to support its business model.

Sports Direct, however, appear not to manage the customer experience, but instead to allow it to be an unconscious side-effect of their low-cost operation.

Is simply cheap sustainable?

Because they seem to compete solely on cost, Sports Direct may be vulnerable to another company offering a similar cost proposition with a better customer experience.  Ian muses if Sports Direct’s low-customer-experience is sustainable in the face of new competition such as that offered by French sports shed operator Decathlon.

Ryanair, on the other hand, I don’t think are so vulnerable to attack on this front.  Two factors argue for this.

The first is that Ryanair actively manage their customer experience and know which aspects of the experience make the biggest difference to their customers.  As a result, if they needed to dial elements of the key parts of the customer experience up or down, I am sure they could.

The second factor is more pragmatic. As I mentioned in my post, Ryanair: Kings of the Customer Experience, Ryanair compete as a low-cost airline because their business model is ruthlessly designed round the limited customer experience they choose to offer. Other operators do not seem to have the single-minded strategic will to make similar choices – and so they live with business models which are intrinsically more expensive to run.

What you pay attention to, you get

The takeaway, I think, is this:  every business, whether it thinks about it or not, offers their customers an experience which reflects the things to which the company pays attention.  If a company focuses solely on least cost supply and appears to pay little attention to the customer experience, then customers get an experience akin to the ‘dark cave’ which Ian describes as being offered by Sports Direct.

Such companies are vulnerable to competition from others which do pay attention to the customer experience and design their low-cost operation around the experience they actively choose to offer.

In short, if we don’t pay attention to customer experience in the boardroom, we shouldn’t surprised if, in return, customers stop paying attention to us.

Image credit: Betty Longbottom under a Creative Commons Attribution-Share Alike 2.0 Generic license.

How Big Data will change marketing (part 2)

Big Data imageBig Data is coming. It will change Marketing, but not necessarily in the ways we might expect.

In an earlier post (How Big Data will change marketing (part 1)) I wanted to introduce the idea of Big Data in practical terms. My take on Big Data is not in terms of volume, velocity or variety, (as coined by Gartner analyst Doug Laney) but in terms of what it is in practice and how it might encourage action.

In my view, Big Data has seven characteristics:

  1. Big Data is not (just) big data.  Big Data is more than data warehouses and structured data repositories.
  2. Big Data is unstructured data. Big Data is messy, error-strewn and has fuzzy edges.
  3. Big Data is behavioural, not attitudinal.  Big Data is about what people do, not what they think
  4. Big Data is about small interactions. Big Data comes from the simple stuff we do, often without realising it
  5. Big Data changes.  All the time.  Big Data is never still. It is always being added to.
  6. Big Data is online, mobile and the real world.   Big Data is coming from all kinds of activity, on- and offline.
  7. Big Data is informational debris. Big Data is a side-effect of other activity – it is mainly not the information we as customers enter consciously when we think we are sharing personal data.

For marketers, the looming presence of Big Data is likely to change many things, including these:

Scientific method  The scale and nature of Big Data are making marketing a rigorous, experimental discipline.  We are getting the means to interrogate very complex data sets very quickly to decide which marketing idea works best.  This is already happening online.   Disciplines such as A/B testing and the thinking embodied by Eric Ries’ excellent Lean Start-up are already in action in many places. Examples include Amazon offering A/B testing as a free service to android developers and Barack Obama using it to raise $60m.  (See also my post, ‘Let’s go hippo hunting‘). This thinking is rapidly moving offline.   Marketers will have to master strict, efficient scientific method to succeed in this new world.

Attitudinal marketing is dead  Well, if not dead, then it’s about to enter life-support.  The  quantity and predictive value of behavioural and activity data means that what people think or feel about a product or brand will become increasingly irrelevant.  We are already finding this on the web.  If A/B testing shows us that consumers prefer to press a red button, and not a blue one, then we are better served by changing all our buttons to red than spending a fortune trying to understand why. This thinking will soon apply everywhere.

Prepare for the segment of one   Big Data will enable us to direct contextual, customised marketing directly at individuals based on such things as (say) their mobile GPS history, online and social media activity, and offline behaviour.  In effect, a marketing campaign for one person.  One implication of the segment of one is that a consumer marketing operation may well need to deliver a million tailored campaigns a year.

This is not just an automation problem.

To run at this level, with minimal errors, cost-efficiently, means the winning marketing operations will be those which adopt and implement the Lean manufacturing disciplines which enabled car manufacturers to deliver a batch size of one, with a cycle time approaching zero. (See my earlier post – SMED: The secret sauce of customer experience, for a related discussion).

We are all going to become Lean, people.

Create platforms, not campaigns  The role of the creative will change. Increasingly, we will need our creatives to design communications platforms, rather than individual campaigns. These platforms will have to flex in innumerable ways to meet the contextual demands of the segment of one.

Brand as algorithm   Brands will be formulated into heuristics – rules which can drive real-time decisions to enable real-time marketing.  The automated brand is coming.

Source, don’t build, your data  By definition, Big Data is a mix of different data sources.  Very few organisations have the capability to assemble, structure and support such heterogeneous sets of data and stay sane (and profitable).  Ignore the Big Data hype about the need to build Hadoop clusters and recruiting data scientists. This isn’t how it is going to go.

Here is how it might.  Companies are going to realise soon that they will be better off working with trusted data intermediaries rather than trying to build their own Big Data. They will pose questions to these intermediaries, such as “….what is the best way to segment the market to identify the people most likely to buy our stuff?…”, or “…when in the customer’s day are we most likely to get positive attention for our proposition…?”  or “…who could be our next customers….?”

These intermediaries will orchestrate data sources quickly to get the best answers to these questions. They may already own some data, some data they may rent, some they may commission and some will come from their clients – but such tasks are best left to specialists.  There is no need to build your own data engine. Spend your time instead trying to understand the questions you need to answer to get to market most effectively.

Of course, for companies which specialise in data harvesting, brokerage, mashup and orchestration, this intermediary role will be a lucrative opportunity. For the rest of us, being able to use such services intelligently will become an increasingly important skill.

Big Data is going to change marketing. But those marketers who do embrace this change will become hugely more effective, productive and  influential.

It will be marketing, Jim, but not as we know it.

Ryanair’s customer experience revisited

Ryanair passenger numbers
Ryanair passenger number growth, CAPA Centre for Aviation

I wrote Ryanair: Kings of the Customer Experience to challenge the blind orthodoxy that offering a perfect customer experience should be the aspiration of every business.

This may be true if you run a seven-star hotel complete with customer butlers, but it does not apply, I believe, for most companies. Most of us need to trim our ambitions to focus on things which cause customers most pain or friction and on those things which customers most value.

An excellent response

Jim Lucas of Lucavia read my post about Ryanair, the Irish-based European budget airline,  and wrote an excellent article in response: The Real Ryanair, Please Stand Up.

Jim and I violently agree that Ryanair have set out strategically to offer a service based on the core things which their customers value: “…Low cost, on time, with bags, that’s it.”

Jim, however, then goes on to say:

‘…To me, Ryanair hasn’t, “…Designed a customer experience to compete strategically.” Their customers don’t care about it and they know it. Instead, Ryanair has chosen a low-cost, high-efficiency strategy vis-à-vis their competition to meet the needs of the utilitarian traveler. (Jim’s emphasis)  In that space customer “service” is all that is required and an experience isn’t a consideration.’

I think Jim’s view is one that many customer experience practitioners share: that customer experience is something separate from the service a company designs and offers.

The whole of the experience

I don’t share this view. I believe that everything that we do which affects the customer is part of the customer experience.  This includes offering the service, yes, but also the things we do which affect how this service is perceived: (I refer to this in another post when I refer to the qualia of customer experience).

Hence my use of Ryanair as an example. What they seem to do, explicitly and intentionally, is manage the customer experience to diminish expectations around anything which lies outside of their core offering.

Get you there on time? Sure.

Cheaply? Yes.

Refunds? Don’t bother.

This setting of expectations is, I believe an absolute part of the customer experience, which Ryanair actively manage in order to support their highly successful business model. This is a strategic choice which, judging by Ryanair’s business success, seems to be working very well.

Good is better than nice

From this choice came the other point of my earlier Ryanair article: “Customer experience is not about being nice, it is about meeting strategic goals.”

Talking to some marketing folk the other day at the IQPC CMO Customer Exchange Event a couple of weeks ago, I found myself reframing this statement so that it became:

Customer experience is not about being nice; it’s about being good.

I think this is profoundly true. Customer experience is not simply an offshoot of the customer service skills industry, as many people seem to believe.

As an air passenger, for example, I value getting to my destination on time, with my bags, more than I value a customer agent’s smile if my bags have been lost.

Yet many organisations, judging by the way they run their services and where they direct their investment, seem to put this the other way round. Yes, being nice is, well, nice – but it is less important than being good at the things for which the customer is paying.

What Ryanair do, better than any other organisation of which I am aware, is to deliver on the stuff that matters to their customers while at the same time actively managing down customer expectations – and delivery – of other stuff.

They are, I believe, managing the customer experience, and doing so very well.

Which is why, while I may not like Ryanair,  I have to admire them.

(My thanks again to Jim for his cogent and considerate response to the original article. His blog is well worth a read).

Image credit: Ryanair passenger growth numbers: CAPA – Centre for Aviation

The bank customer experience that’s 3 times better than Apple

Red TapeBanks offer a specific customer experience three times better than that offered by Apple, because, it seems, Apple have let lawyers dictate it.

Red tape redux

I want to buy a house. I need a home loan for £250,000.  I approach First Direct, a direct retail bank in the UK, owned by HSBC.   I know that I will have to accept from them a comprehensive and rigorous set of terms and conditions.  After all, I am borrowing a quarter of a million pounds and mortgages in the UK are highly regulated.

First Direct’s terms and conditions for my mortgage are a comprehensive, rigorous and exhaustive 4,480 words.

To have some music to play while I move house, I want to download Our House by Madness, on iTunes.

And here is where things get cockeyed. To download the nutty boys’ masterpiece, I have to read and accept iTune’s terms and conditions.  These run to 14,451 words.

Apple expect me to plough through 3 times more verbiage than was needed for my £250,000 mortgage, just for a 99p song.

This can’t be right.

A novel experience

Legally, I am supposed to read Apple’s terms and conditions before I can install iTunes. But, like most of us, I haven’t.

Who has the time to read lawyer-speak that runs almost the same length as the first third of Kurt Vonnegut’s great novel, Slaughterhouse 5?

If I have that kind of time available, I’ll read a book.

It gets worse. Every time Apple updates iTunes, every couple of months or so, they require that I read these conditions again. This is neither practical nor reasonable.

Lawyers: enemies of customer experience

So First Direct, a UK retail bank, is offering a customer experience three times better than Apple’s. What’s going on?

The most obvious explanation is that Apple has let their lawyers off the leash. This is bad for the customer experience because most general counsel are required to think of the customer as the enemy. Corporate lawyers stay awake at night making sure customers don’t sue or rip-off or defraud or have grounds for compensation.

Giving the customer a good reading experience is not top of their insomnia list.

Something better

Someone, however, is doing something to make this particular experience better for customers of a range of companies, including, they say, Apple.

Terms of Service: Didn’t Read (ToS:DR) offers a free plug-in to browsers that rates terms and conditions on a five point scale (A- Green to E- Red) depending on the degree to which a particular set of terms and conditions require us to sign away our rights. It ‘s like a Reader’s Digest version of the terms and conditions to which we have to agree.

This seems to me to be an eminently sensible solution to this problem. I will sign up to ToS:DR straightaway – just as soon as I read their terms and conditions (409 words)…

So it goes.

PS Some may think that I am singling out Apple unfairly.  Perhaps, but by way of comparison, Google’s terms and conditions of service come in at 2,966 words, Facebook’s are 4,643 and Amazon, 5,269. (Word counts come courtesy of my browser’s cut and paste function and MS Word’s word count facility).

PPS This post comes in at 539 words.  If this was iTune’s terms and conditions, you’d be only 5% of the way through by now…

Image credit: Rosser 1954, released into the public domain.

Big Data is already here

vorratsdatenspeicherung-540x304In my earlier post, How Big Data will Change Marketing (part 1),  I offered a definition of Big Data.  Here is a brilliant example of what it looks like.

A life revealed

Malte Spitz is a member of the Bundestag, the German parliament.  He sued mobile operator T-Mobile to get their records of his cell phone activity for a six month period in 2009.  It came in an Excel spreadsheet with 35,851 rows.

Zeit Online, the digital imprint of Germany’s top-selling weekly newspaper, Die Zeit, combined this data with other information about Hr. Spitz’s life which they gleaned from social media and publicly available online sources.

The result was illuminating.

To quote Die Zeit:

“Each of the 35.831 rows of the spreadsheet represents an instance when Spitz’s mobile phone transferred information over a half-year period. Seen individually, the pieces of data are mostly inconsequential and harmless. But taken together, they provide what investigators call a profile – a clear picture of a person’s habits and preferences, and indeed, of his or her life.

This profile reveals when Spitz walked down the street, when he took a train, when he was in an airplane. It shows where he was in the cities he visited. It shows when he worked and when he slept, when he could be reached by phone and when was unavailable. It shows when he preferred to talk on his phone and when he preferred to send a text message. It shows which beer gardens he liked to visit in his free time. All in all, it reveals an entire life.”

To model what they mean, Zeit Online produced this interactive map.

This is Big Data in practice.

I will leave it to other commentators to discuss the political, legal and ethical issues raised by Big Data.  I am going to assume, instead, that it is here to stay and that it will increasingly affect our lives.

In my next post, I will develop further some ideas about how Big Data will affect Marketing.

Tip of hat to Roland Harwood of 100% Open for the original Die Zeit article.

Image credit: Zeit Online

How Big Data will change Marketing (part 1)

Big data imageIf Big Data delivers what it promises, then the implications for Marketing – and indeed, all of business – will be profound. Before we can understand what these implications might be, we first need to understand what Big Data actually is.

The promise of the new oil

Big Data, we hear, is “…the new oil”. It is the next big thing, the new realm of business opportunity, the them thar hills in which gold can be found. With Big Data, we are told, we can see flu outbreaks before they happen, tell how the stock market is going to move today and discover that you are pregnant before your family does.

Big Data makes big promises. But many of these promises have been made before, with, for example, data warehousing (and the famous beer and diapers story). What is different this time, and what difference will it make?

Consultants and technology companies have been beating the Big Data drum for some time, but there is little consensus of what the term really means.  If, for example, I am trying to build a data centre to handle big data, then naturally my definition will reflect the size and complexity of the data to be handled.

I believe, however, that most of us with a business perspective need a definition which enables us to think about the value and uses to which Big Data might be put.  My stab at doing so is below, borrowing freely from excellent recent articles by Hung Lee (Big Data is Not ‘Lots of Data’) and Alex Cocotas of Business Insider.

Big Data is not (just) big data

What makes Big Data interesting is not the the size of the data sets (although these can be mind-bogglingly big). The value of Big Data is much more about the kinds of data which it embodies, and (particularly) the uses to which it can be put.

Big Data is unstructured data.

Big Data is not that which fits neatly into a relationship database or which can be categorised by tags (although it may well contain data of this type).  Big Data is a hybrid mashup of different kinds of data such as geolocation, contextual data, telemetry, life events, video, demography, social media and more.  It’s messy, complex and has fuzzy boundaries.

Big Data is behavioural, not attitudinal.

It is about what people do, not what they think. Big Data is not, for example, about focus group findings or survey results.

Big Data is about small interactions.

Big Data might include transaction information, such as what is in our shopping trolleys – but this is a known game and is only an adjunct to the important stuff. Important stuff?  What we do before we put things into our trolleys.  Where we have walked. Whom we have met.  What we do for fun. What the weather is like.  What we are wearing. What everyone else is doing. The TV channels we watch. You know: the small stuff we do all the time.

Big Data changes.  All the time.

Big Data is gathered continuously, in real-time, often from millions of dynamic sources. This means that at any time, we can only have a snap-shot of this continuing river of data. By the time we look at it, it’s already changed.

Big Data is online,  mobile and the real world.  

Big Data is credible because Google and Amazon and (a very few) others have been able to farm and use complex online customer behaviour data to make serious money. Now mobile is changing the game. Those of us with smart phones use them everywhere.  We use apps to help us in the physical world.  We use services like GPS and geolocation which note everywhere we go.   Now when we turn on our mobile phones, we create data about our behaviour in the physical world in ways comparable with the data we create online. What do we call this melange of online, mobile and physical information?  Big Data.

Big Data is informational debris.

Big Data is what we throw off when we do other things.  When we stop what we are doing to fill in a form, or have our picture taken or scan some stuff to get ourselves registered or updated – that is not Big Data. Or if it is, it is only a small part of it.  Big Data is what we leave behind us when we play games, or take pictures, or move house, or phone someone up, or browse around a shop, or go for a run or change the channel. It is a side effect.

That’s my shot at defining it.  Does this work for you? What have I missed or got wrong? Let me know.

If Big Data keeps its promises, the implications for all of business – but especially Marketing – are profound.  I will explore some of these implications in my next post.

This series of posts arose as a result of a panel discussion earlier this week at IQPC’s CMO Exchange event at St Albans.  I had the pleasure of sharing the platform with Paul Blacker of BT and Michael Woodburn of Capital One, and it was admirably chaired by my old chum Vincent Rousselet, CEO of the Strategic Planning Society.   Our conversation offered a good range of views on these questions. These opinions I express here, however, are entirely my own.

Contact centres – the end of 28 days later

28 DaysContact centres aren’t perfect, but they are better than what went before.  They are here to stay, even while we continuously improve their performance.  Contact centre transformation is easier when we don’t lose sight of the core reason for the centre in the first place: to enable customers to talk to our company, buy things and get help.  

28 days.

Nowadays it has a different association (see illustration) but many of us in the UK still associate this timeframe with a familiar phrase:  “Please allow 28 days for delivery.”

It was a routine part of the terms and conditions for mail order.

A serious customer journey

Mail order, of course, meant not just receiving goods by post, but ordering them by post as well.  Find the product you wanted in a newspaper (or magazine or catalogue), fill in a paper form, cut it out, write out a cheque for payment, put them both in an envelope, address the envelope, put a stamp on it, go to a post box, post it…

…and wait.

For up to 28 days.

Almost a month.

Then when the parcel arrives, open it and see if what you have received is anything like the black and white image in the original advertisement.  Or the right size.  Or if it works properly.  And has not been damaged in transit.

And if it’s not right, begin the whole rigmarole again. In reverse.

Not, by any measure, an ideal customer journey.

Contact Centres make it better

Contact centres changed all that.  Want to buy something? Call up, place the order and it will be dispatched quickly.  Problem with a product or service? Call up and the agent will handle your problem or help explain what we need to do to resolve it.

Sure, none of us like being put on hold or to have to navigate through endless sequences of IVR numbers; and many of us have service disasters we can recount about when we got to speak to the agent from hell, but we forget, sometimes, how much better it is than it used to be.

Oddly, the internet hasn’t killed off the contact centre. Despite that we can now order things and services online from our laptops and tablets and mobiles, many of us still want to call up and talk to someone. And when things go wrong, while email, customer forums and online chat are all very well, many of us still want to call up and talk to someone.

Why?

Because our lives are complicated and what we want is complicated and our problems are complicated and sometimes we need to explain to someone – a person – what we want, and have them confirm that they have understood what we want, and that something will be done about it.

And a website can’t do that.

Sometimes, of course, it doesn’t work this way, and every one of us has a horror story to tell. But most of the time it does, and often, it works very well indeed.

Contact centres enable this experience.  And they continue to do so: while most now also handle customer communications across a range of channels, the customer telephone call tends be the heart of the operation.

Keep sight of the purpose

The challenge facing all of us who work with customers, however, is how we equip our people in contact centres to deliver a service which is consistently good, and consistently cost-effective – while  customers remain complex people with changing needs, and the technologies available to customers and to us develop constantly.

I believe that the only way to succeed in meeting this challenge is to remember one thing:  the core purpose of the contact centre is to enable customers to talk to our companies, to buy and get help.

Everything we do in a contact centre is about doing this better.

And when it gets hard to do this – and it will – we can console ourselves with one fact: even when things aren’t great, for most of our customers, things are much, much better than they were.

Contact centres revolutionised how we engage with customers and vice-versa. People complain about  them, sure, but how many of us remember what it was like before they were commonplace? I, for one, don’t want to wait 28 days again…

Ryanair: kings of the customer experience.

Image of Michael O'Leary 2/06/2011Silver tongued charmer

“You’re not getting a refund, so **** off. We don’t want to hear your sob stories. What part of ‘no refund’ don’t you understand?”

“People say the customer is always right, but you know what – they’re not. Sometimes they are wrong and they need to be told so.”

“Mother pays £200 for being an idiot and failing to comply with her agreement at the time of booking. We think Mrs. McLeod should pay €60 [just] for being so stupid… Thank you, Mrs. McLeod, but it was your ****-up. We’re not changing our policy.”

“We already bombard you with as many in-flight announcements and trolleys as we can. Anyone who looks like sleeping, we wake them up to sell them things.”

Michael O’Leary is the CEO of Ryanair, a European budget airline headquartered in Ireland. The quotes above are some of the things he has said at press conferences and results announcements over the years; this thinking is reflected in the uncompromising ways in which the company operates. In many ways, he is the antichrist of orthodox customer experience thinking.

The Ryanair Customer Experience Paradox

According to much customer experience orthodoxy, Ryanair should be in serious trouble. Poor customer experience should result in customer dissatisfaction, disloyalty, social media backlash and poor brand reputation.

And it does.

In spades.

But here’s the thing.  The customer experience Ryanair offers does not  affect the bottom line. In fact, one might argue that it is a major reason for Ryanair’s consistent, spectacular bottom line growth.

Ryanair has just announced yet another set of stellar annual profits. To March 2013, the airline made  operating profits of €718m ($924m) on revenues of €4.88bn ($6.28bn), up 11% from last year.  And this is no flash in the pan: Ryanair consistently grows revenues and profits every year. Ryanair is a company that likes recessions.

Something is amiss.  And on the basis of the company’s sustained growth and returns, it doesn’t look like it’s Ryanair. So is received customer experience wisdom mistaken?

And if so, does this mean that we should abandon our efforts to improve the customer experience?

Just the opposite.  Ryanair succeeds (and its CEO is noteworthy) precisely because it is one of the few companies to have understood exactly the customer experience that it needs to compete strategically – and then makes sure this is what it delivers.

Ryanair proves the strategic case for customer experience

Ryanair is a lean, low cost airline.  It sets expectations for customers about how it works and what it will and (and particularly) won’t do.

It does not burden itself with the very high costs associated with exceptional customer service, because it offers very little by way of customer service.  This is why O’Leary is so uncompromising about refunds – because if Ryanair compromise on this once, they will have to do it again.  And then they will need to employ people to manage refunds. And they will get more complaints, because customers will think that they might get something by complaining.

So Ryanair will have to staff a complaints department.  And this will lead to escalations, and reporting, and budgets, and bureaucracy, and management’s attention will get distracted by customer issues, and this will take their eye off the ball of running things very cheaply and efficiently.

And at that point, their cost base will have ballooned and they will no longer be competing on cost.  (And then their competitors will kill them by competing on service).

Instead, Ryanair are very explicit about the customer experience they offer.  They are low-cost. They will get you there, on time. With your bags.  That’s it.  No other promises. They deliberately limit the customer experience and manage it tightly because doing so is essential to their strategic success.

And against these things – the things which, because they really understand their customers, they know are most important to them – Ryanair are among the best in Europe.

And this is the lesson Ryanair teaches all of us about the customer experience.

Customer experience is not about being nice,
it’s about meeting strategic goals

We must not fall into the trap of blindly accepting that our goal is to make things a great as we can for customers. This is not the purpose of customer experience transformation.

Our purpose is instead to specify, build and deliver the customer experience we need in order to meet our organisations’ strategic goals.  And then we must drive this experience as ruthlessly and singlemindedly as Michael O’Leary drives Ryanair to succeed.

Ryanair and Michael O’Leary are, in effect, posing each of us a very challenging question:  what is the customer experience our companies need to offer so that we can best meet our strategic goals?

PS I hate flying by Ryanair, but I do so when I have to. 

(Image credit: ilovemyirishculture.com under a Free Art License)

The customer experience is about more than fixing things.

Perusing books at Selfridges 1942It’s about employees

At the start of the year, Forrester Research‘s Kerry Bodine and colleagues made some predictions about the areas which will grab attention in the customer experience space this year.  One prediction was that employee engagement will be “…white-hot…” in 2013.

They may be right.  The good folks at HCL have been making this point for some time and attribute their startling growth to an “Employee First, Customer Second…” approach.  In 2010, their CEO, Vineet Nayar, even wrote a book about it in 2010.

Unusually for a CEO these days, at the time of writing some three years later, Mr Nayar is still in post and the HCL stock price appears to be doing very well. Perhaps there is something in what he says.

The core idea, I think, is this: employees are the company.  They make the difference for customers.  If they are happy, motivated and enabled to succeed, then a good customer experience may be possible.  If employees are unhappy, unmotivated or not equipped to succeed, then nothing we try for the customer will really make much difference.

It is in our control

For those of us interested in customer experience transformation, this perspective offers another potential bonus: while we cannot manage our customers, we can and should manage our people. The challenge of working with our people to make things better for customers is in our hands, no-one else’s.

I believe that how company drives its people to make things better for customers indicates whether a company regards the customer experience as an overlay on their “core business’ of selling, shipping and service – or if their approach to customers reflects serious strategic intent.

As Jeff Bezos, CEO of Amazon, said in his letter to stockholders a couple of months ago:

“One advantage – perhaps a somewhat subtle one – of a customer-driven focus is that it aids a certain type of proactivity. When we’re at our best, we don’t wait for external pressures. We are internally driven to improve our services, adding benefits and features, before we have to.”

Proactive customer experience is a strategic choice

This idea of proactivity is the whole game, right there.  Organisations which are serious about the customer experience proactively drive their people to seek to make things better before customers see reasons to complain.

Sure, there are companies which are doing good things by listening to customers and putting in improvements to fix things which customers don’t like.  This work is valuable, and good, but it does not address the real challenge.  If we simply fix things about which customers complain, then we are  playing catch-up. We are saying, in effect: “we aspire not to make customers unhappy.”

The difference is in the bottom line. Jeff Bezos again:

“Proactively delighting customers earns trust, which earns more business from those customers, even in new business arenas. Take a long-term view, and the interests of customers and shareholders align.”

Customer experience is much more than fixing things for customers. It is about making a strategic choice to be proactive in making things better for customers, it is about reflecting this choice in the ways we guide and enable our people to make things better for customers – and it is about doing so because it is the most effective way to grow and sustain the bottom line.

How do our companies measure up?

(Image credit: Ministry of Information Photo Division Photographer [Public domain or Public domain], via Wikimedia Commons)

CRM can be fun. No, really.

Finish line.Thinking about CRM (Customer Relationship Management) from the sales team’s point of view has stimulated some interesting new possibilities.

I once oversaw the transition of a B2B CRM system from a locally installed brand name system to a market-leading cloud-based competitor.  The old system had limped along with inaccurate data, incomplete records and resentment by the sales team.  People saw it as something that could not be trusted, an overhead that  got in the way of sales and marketing.

We were not alone, as Ben Meredith points out in a recent post.

When we came to implement the  new system we had one primary principle: it had to work for the sales team.  This meant that it had to be exceptionally easy and attractive to use, relevant to their roles, with clear triggers for when and how it was to be updated. All other requirements were secondary.

The outcome? An almost seamless transition within six weeks and excellent adoption.

Results? Better accuracy of data, trustworthy analytics and sales forecasting. Better marketing, easier sales, improved customer relationships. Everything we wanted our CRM system to deliver.

These results happened only because we paid attention to the core challenge: whose job are we trying to make better?  For most CRM implementations, this will be the sales team. Get it right for them, and things will get better for the customer too.

Which is why I like the thinking of app developer LevelEleven. Their newly rebranded Compete app adds game elements to Salesforce.com to help drive sales team performance. Their real trick, of course, isn’t the app, but the psychology: good sales teams thrive on competition.

CRM as fun? That can’t be bad.

The qualia of customer experience

Red rose in snow picWe cannot truly understand what our customers experience. But we can understand how they behave. If we want to make things better for them, we will be better off observing what customers actually do, not trying to work out what we think they are experiencing. 

I can’t get into Joe’s head

My friend Joe cannot see the colours red or green – he is colour blind. My colour vision is normal. Science explains this by saying that some of the cone receptors at the back of Joe’s retina are different from mine.

But when I try to understand what Joe sees when he looks at, say, a grassy meadow, I am unable to do so.  His experience of the greenness of the grass is different from mine.   I cannot put myself into his head.

Qualia are what we experience

Philosopher Clarence Lewis in 1927 coined the term qualia to describe the distinct subjective experiences we each have when, for example, we smell a rose, see the white of snow or taste a lemon.

Qualia (singular: quale) are the essence of experience.  They are also pretty much inexplicable by science.  Science – cognitive psychology, neuroscience, physiology – has pretty much nothing to say about what Joe experiences when he sees a blue sky and how that compares with what I experience when I see that same sky.

If you don’t believe me, imagine trying to explain the greenness of a meadow to someone who is blind from birth.

Scientific methods

This is, in part, why understanding the customer experience is tough.  Each customer’s experience is different. If we ask them about their experience – to describe the qualia of buying – we can only get a limited understanding of what they experience.

How does science address the problem of qualia?  It ignores them. Instead of seeking to understand what we experience, scientists instead focus on what they can observe. In particular, they focus on behaviour.  Rather than investigating what  people experience, scientists explore instead what people do when they experience X or see Y.

This is a good principle to adopt when working on customer experience.  Trying to understand the experience of customers is likely to be less valuable – and less effective for guiding our actions – than observing what they actually do.

The perfect, but useless, manuals

This is shown by the PC manuals fiasco. A few years ago a major PC manufacturer took great pains to consult with customers so that  the manuals for new users to set up their PCs were as well-written, user-friendly and accessible as possible. For several years, users rated the manuals as the best in the business – they even won awards.

But it wasn’t until the company undertook some studies into what new PC users actually did that the truth emerged.

More than 95% of users never opened the manual at all.

They turned on their PC and assumed that the start-up process on-screen would take them through set-up. And if it didn’t, they got very unhappy indeed.

The company had made the mistake of asking customers what they thought, instead of  observing what they actually did.

The colours of marketing

Leo Widrich of Buffer.com has written a great article for Fast Company on the science of colours in marketing. In it, he explains how colours can influence customer behaviour.  He also describes an experiment by Hubspot to understand if customers prefer to press a red or a green button on-screen (read the article to find out which button won :-)).

The folks at Hubspot just needed to know which colour encouraged more customers to press the button. They did not need to know why.

As Leo Widrich says in his article: “…data always beats opinion, no matter what.”

And if we are to make things better for customers, it is probably best for us to adopt the same attitude. Let’s worry less about understanding the customer experience and worry more about observing the things customers show us they prefer.

(If you want to find out more about qualia and why they pose a problem for science, the best source is Daniel Dennett, a terrific writer on philosophy and cognitive science.  His 1991 book, Consciousness Explained is a good first port of call; a more technical discussion can be found in his article, Quining Qualia, (in A. Marcel and E. Bisiach, eds, Consciousness in Modern Science, Oxford University Press 1988)).

(Image credit: Paulis under Creative Commons Attribution license)