It has been a really testing couple of years for individuals, families and businesses – and the service industry has performed wonders to keep things going. Without doubt, the true value of service shone through during the worst of the pandemic when essential services were maintained and some degree of continuity was upheld during strange and stressful times.
However, as has become increasingly clear, the end of the pandemic hasn’t meant a return to normality – whatever normality is! Supply chain challenges have persisted, skills shortages have got worse, the war is raging in Ukraine and we have very real cost of living and inflation challenges here in the UK (as elsewhere).
I am becoming concerned that a lot of the good work that was performed during the pandemic to raise perceptions of the value and importance of service could be undone in this period. Customer service leaders and Board executives need to take stock in order to reset and take action.
A vicious circle?
We are in danger of a vicious circle forming that drags standards down. Some of the recent issues experienced by customers in the airline sector have been extremely disappointing to say the least. One can only hope that solutions are found to alleviate the cancellations, queues and delays as soon as possible.
But it is not only the airline and travel sector where problems are occurring. They are beginning to spread more widely into a number of customer service environments too.
The beginnings of the vicious circle can be traced to the skills shortages that are afflicting so many businesses. This, combined in some cases with a desire to keep costs down, means that there are not enough service professionals available to help customers. The automated technology that’s used today to serve them – chatbots and virtual assistants – is not sufficiently sophisticated ‘yet’ (if ever) to deal with the complexity of some of the human issues that arise. This leads to customers who are already frustrated getting more upset and sometimes belligerent. This rebounds on the service staff, who become increasingly demoralised and unhappy. They look around them and feel that they are under-paid, under-trained and under-supported. They leave or go sick. This makes the staffing issues worse – and so it goes on, in a downward spin.
Does this sound familiar? I hope it doesn’t – but there’s an increasing risk that it will do unless businesses take real action.
Investment, planning and risk management
The good news is that it can be fixed. But there are several fundamentals to make this happen. The first of these is investment. There needs to be recognition at the top of the organisation that customer service is not just an administrative function, but a business driver. Better service drives increased sales, better customer engagement and more loyalty. The business case is already there for it to be properly invested in.
With the right investment, service can be adequately resourced. But another essential element is to conduct a proper resource planning exercise, looking ahead to anticipate the peaks and troughs of demand. This requires a full understanding of the end-to-end customer journey, complete with all the dependencies and hand-offs to third parties and suppliers. Only then can resources be smartly deployed so that customer service support matches demand all the way through the journey.
In a sense, much of this is about applying the classic business principles of risk management to the service agenda. I fear, however, that many organisations are not doing this. Their approach has become too formulaic and often looks at just part of the service journey and therefore it is difficult to react quickly enough as conditions change.
Thinking and behaving with the longer term in mind
There is another issue here. That’s the fact that it takes time for really good service to be embedded and sustained – improvements through skills development and technology enhancement don’t happen overnight. This is something that as an industry we need to keep working on communicating and raising awareness of. The business case is there, and we have proved it – organisations who, over the longer term (5 plus years), have above average customer satisfaction will have 10% higher levels of profitability and nearly 5% higher revenues. Customer loyalty is also improved. Our research has found that nearly a third of customers are prepared to pay more for excellent service – that’s a good base to work from as organisations build customer service frameworks that produce sustained excellence, not just a short-term uplift in response to immediate problems.
We also need investors to pay more attention to customer service data, because that will in turn incentivise more organisations to invest more in it. At present, many investors are obsessed with short-term financial performance, and not much else. Strong customer satisfaction indicates healthy long-term prospects for a business because it is more likely to result in repeat business from more loyal customers. Taking a longer-term investment view will see more consistent and sustained returns. But we have to change some of our mentality to address this.
In recent times, customer service has truly come of age and begun to be appreciated for the invaluable commodity it is. Organisations owe it to their hard-working customer service professionals not to let this slip. The time has come to reset, invest and focus in order to push satisfaction back in an upward direction and have a higher performing economy.