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Friday Service Recap: AHT, Service Excellence, Silos, and More Customer Service Stories for the Week

By Aly Pinder | Uncategorized | No Comments

Every week, Sumair and I will post our most interesting service-minded stories for the week as part of a Friday recap. We’ll comment on one story each and then add 3 others for your review.

For the sixth installment, and week 11 of 2017:

Sumair’s pick:

Topic: AHT. It’s time to Move On.
Source: HBR: https://hbr.org/2017/02/call-length-is-the-worst-way-to-measure-customer-service

Commentary: We agree that AHT (average handle time) shouldn’t be the barometer for customer support performance. As customers engage in a higher degree of self-service for low complexity issues, they are likely to reach out for live support for issues that are complex and require proper diagnosis and care. In this, putting agents on the clock drives the wrong behavior. TSC’s research has shown that organizations are slowly gravitating towards a framework of scores to measure customer service and customer experience. Most organizations still look at CSAT and loyalty scores. An emerging group, 37% of our group, now measure and evaluate customer experience on the basis of customer effort or ease of doing business.

The authors do indicate that AHT is useful for an organization to assess its overall performance and its cost drivers and can help prioritize future investments. That said, agent performance and recognition should be based on resolution as opposed to speed.

Aly’s pick:

Topic: Breaking down silos to create culture of service
Source: Marketing Week: https://www.marketingweek.com/2017/03/09/siloes-bureaucracy-holding-back-customer-experience-study-finds/

Commentary: The siloed organization is nothing new. I feel like we’ve discussed this topic for a decade already, if not longer. But as this article highlights IT departments are still siloed from service, and HR still doesn’t work with customer support to identify and deploy a strategy. For service organizations that mainly support break/fix, reactive service engagements, the entire organization may not be needed and thus a siloed structure won’t cause havoc. But as service models evolve to being more proactive and predictive, other teams are needed to successfully deliver service. For example, IT is needed to design equipment to capture performance data, HR is needed to hire service workers with soft skills, and sales is needed to position contracts that charge for predictive support. As recent TSC data shows one of the top reasons why innovative projects like IoT connectivity don’t get off the ground is the inability to gain internal buy-in across departments (as stated by 41% of respondents) – silos of thought, strategy, and action. Service is a team game and the entire organization needs to be involved and bought-in to achieve service excellence and wow customers. If walls remain between functions of the business, the ability to deliver innovations in service will remain stunted.

Our Three Other Articles
1- Customer service still makes the difference at Mequon Ace (OnMilwaukee, 3/14/17)
2- VW Korea promotes higher customer service through ‘We Care’ campaign (The Korea Herald, 3/16/17)
3- In a tiny town, a phone company right out of a Rockwell painting (The Boston Globe, 3/11/17)

If interested in viewing our latest data and insight, please visit: http://info.servicecouncil.com/recent-content-and-events

We would love to have you become part of our research panel. If you would like to, please visit http://info.servicecouncil.com/tsc-join-a-research-group and select the area(s) of alignment. (* Participation in research groups is reserved for practitioners only. Consultants and technology solution providers are not allowed to join and will be referred to other ways of getting involved.)

Till next week.

Aly Pinder
Director of Member Research & Communities
ap@servicecouncil.com or @pinderjr

Sumair Dutta
Chief Customer Officer
sd@servicecouncil.com or @suma1r

Service Leaders Look to Plan Beyond Powerball

By Sumair Dutta | Uncategorized | No Comments

What would I do if I won $1.3b (or $900m or whatever amount after tax)? It’s a question that nearly everyone here in the United States is asking. Well, people outside are asking as well as evidenced by my parents, but not as much.

It’s interesting that I’ve asked a similar question in recent interviews with service leaders as part of The Service Council’s InService podcast series (Look out for new episodes featuring Ooyala and Heidelberg). The question is slightly different but essentially focuses on what service leaders would do if given a significant amount in financial resources. The answers vary but it mostly comes down to getting more resources. For some this comes in the form of people; for others its in the form of technology; and for a large number its in the form of customer insight. Yes, customer insight is a resource.

The fact is that service organizations are facing a major transformation. This is true for those that directly deal with consumers or those that deal with other enterprises. In B2B service businesses, the talk of transformation has all been around the increasing importance of service as a differentiator in the face of slowing product demand and increasing competition. In 2014 The Service Council (TSC) research, three out of four organizations indicated that the importance of service to an organization’s financial well-being had increased over the previous 12 months.

This transformation is different. Service buyers are changing. For one, the level of office held by the buyer is rising. As we at TSC conduct our annual 2016 Trends in Service survey, we find that 50% of organizations claim that they now face a higher-level buyer. Procurement or Purchasing still account for the largest share when it comes to buyers of service, but we a greater level of C-level financial or IT oversight in the purchase of services. And these senior-level buyers are demanding more value. As per the first 50 organizations participating in our survey, these were some of the areas/features that were most in demand:

  • Pricing – Lower cost service contracts
  • Field Service – Shorter response times and smaller windows
  • Terms – Consolidated terms and pricing for multiple facilities
  • Service Contracts – Performance-based
  • Services – Training
  • Portals – Self-service information and knowledge

All of these demands are being made in an environment when the cost of delivering service continues to go up.

This is why we see service organizations continue to focus on delivering value via solutions. These include information portals, training services, inventory management services, consumable monitoring and replenishment services, multi-vendor services, and more. At the crux of the issue is developing a clear understanding of customer pain points. With the aid of VOC programs, condition monitoring (and other IoT-related) systems, point-of-service tracking, and customer issue management systems, we now have all of the data we need. The desired result is to use this data to segment service customers and offer customized solutions to target unmet needs.

As mentioned, we’re still collecting data on 2016 trends. If you run a service business, please feel free to participate in our survey. We will be sharing results on a webcast taking place on January 21 at 11:30am Eastern. Joining me on the webcast will be representatives of the Technical Services team at Cisco Systems. Our chat will touch upon 2016 trends, service organization pressures, and the impact of a changing service buyer. (Register, if interested)

Stay tuned for more data on 2016 trends. Good luck with Powerball.

3D Printers in Service Vans: Lets Pump the Brakes

By Sumair Dutta | Perspective, Uncategorized | No Comments

Every day there seems to be a new article describing advances made in 3D printing. I just read one on how 3D printers were being used for whiskey glasses on the International Space Station. There is no doubt in my mind that 3D printing will disrupt and revolutionize supply chains. Some of that disruption is already occurring and early adopters are making some progress. Yet, most organizations are in a wait and see mode.

In late 2013, we lobbed a question to our community regarding the impact of 3D printing on service parts businesses. At that time, 71% of responding organizations (n=100) said no. Twenty-three percent (23%) said they didn’t know yet, and only 6% said yes. In 2014, we posted a similar question to a slightly larger group (n=175) regarding 3D printing and its broader applicability to the service business. In this case, 3% of companies were currently using 3D printers, 7% were building the business case for use in the short-term, and 24% were evaluating for use in the near future (24-48 months). Of the remaining 66%, most downplayed the role of 3D printing.

3D Printing in Service

What it seems to be is that those folks who were on the fence, continue to evaluate the technology more, and some have actually put pilots and projects in place. E.g. On a recent webcast with Lexmark International around service supply chain management, Brad Lawless, their Director of Global Service Parts Operations states, “3D printing is a critical part of my tool box today and one of the reasons that we have extremely high fill rates.” Brad uses the example of a 3D printing partner who provides a cost-effective 3-day turnaround for a high quality printed parted based on a model sent in by Lexmark. Yet, Lawless also states: “It will be years before you have Lexmark branded vans with 3D printers in them.”

So where do 3D printers fit in when it comes to service parts? Our recent 2015 parts research has found that inventory management of service parts continues to be a major area of focus for those involved in running service supply chains. The issue is in balancing the availability of parts for technician and customer use with the cost of inventory. If you run too lean, fill rates suffer. If you overstock, you have a lot of money tied in inventory. This gets even more complicated when you think of the variety of parts needed to support multiple products.

In the realm of inventory management, we also found that a large percentage of organizations were being burdened with a large inventory of obsolete parts or parts for products that are at end of life. Since most customers look to extend the life of their products to delay the eventual replacement discussion, they still need support in the form of parts and service. This creates a unique challenge for service organizations as they are planning to stock up and support their newer lines of product vs. products that are obsolete. More so, as suppliers move away from supporting older products, it becomes more and more difficult to order necessary products, thereby forcing organizations to essentially overstock.

Enter 3D printing. Service leaders we speak with see the entry point for 3D printers in the support of parts for obsolete or legacy products. If a part is needed, it can be created on-demand and delivered to the customer with a short turnaround, thereby reducing the inventory burden on the service provider. While the cost per part might be higher, it is offset by the decrease in inventory held by the organization.

Before that happens, organizations (and service leaders) have concerns around:
– Velocity of output
– Quality of output
– Validation that the part is up to standards
– Regulations around the use of 3D printed parts especially in regulated industries

These challenges can and will eventually be put to bed as advances are made to the technology and there is a greater demand from mainstream manufacturing to adopt 3D printing. It’s only a matter of time. Yet, for most in the service realm, these are still early days. A quote from one of my conversations, “The engineers love 3D printing. But the excitement fades when you talk to the operations manager.”

If interested in listening in to our conversation with Lexmark International and Durst Image Technology USA, visit our Re-Imagining the Service Supply Chain webcast page.

We’ll be discussing 3D printing on an upcoming parts IdeaShare entitled Innovation in Parts Management. Space is limited, but feel free to register and we’ll see if we can get you in.

Otherwise, feel free to send in your comments on 3D printing and we would love to showcase some of the ideas around the increased use of this technology for better service performance.

Getting More with Self-Service

By Sumair Dutta | Uncategorized | No Comments

Organizations, that support consumers and enterprises alike, are looking to enhance the self-service opportunities available to their customers. A 2014 The Service Council research effort found that 6 out of 10 organizations were looking to provide increased self-service resources to their customers.

One might think that’s all great when it comes to simple fixes around the house, but what about the service tied to complex machinery? In these instances, do organizations really want their customers to be tinkering with equipment? Not necessarily, but organizations do want to develop a better understanding of the breadth of service needs. This is done in order to expose service issues that can be solved directly by customers at their own convenience. Increased intelligence on service occurrences is being assembled with the aid of new technology. The Internet of Things (IoT) is empowering service organizations to dig deeper into service incidents. As a result, organizations can appropriately diagnose a service situation, determine corrective or preventive action, and execute on service delivery. Depending on the action necessary, service execution can take place at the hands of the customer with no organization involvement, at the hands of the customer with some organization assistance, or at the hands of the organization with no customer involvement.

The traditional driver for self-service investments was cost elimination and the reduction of the burden on the service organization. Now, there is the realization that customers often resort to self-service channels as a first attempt and therefore it makes sense to provide information and resolution paths on channels and mediums preferred by the customers. In essence, this serves to improve customer satisfaction and also reduce the burden on the service organization.

Does this mean that we should just dump all of our service procedures, support manuals, and more online and let clients fend for themselves? After all, it is in support of greater self-service. That would not be appropriate as it fails to account for the entire experience delivered to the customer. While the customer might eventually track the necessary information, the time and effort expended might negate the overall convenience of the self-service interaction.

Excellence in self-service requires a focus on effectiveness and experience. Effectiveness is related to the actual resolution of a customer query. A customer needs to have the confidence that when they seek support, there will be a path to resolution. If there is no resolution, trust is broken and that particular path of service inquiry will never be attempted again. Experience is tied to the way in which resolution is achieved. Factors such as customer effort, ease of information access, service journey flow, and more become extremely important here. Was the resolution achieved in such a manner that was easy for the customer and will lead to a repeat use of that particular mode of service delivery? While effectiveness is the basic requirement of the service transaction, experience drives commitment and loyalty.

To deliver an ideal experience, it is essential that organizations understand the customer journey and the context in which service is being sought. Simply taking a service procedure as conducted by a knowledgeable service agent and pushing it in the hands of the customer is ineffective and leads to frustration and self-service channel abandonment. Which then brings us back to a live service interaction, only this time with an unhappy customer.

I’ve laid out several ideas and best practices around self-service in a thought leadership paper (conveniently titled Getting More with Self-service) that can be accessed here or here. These ideas were assembled from numerous interviews with organizations that make up The Service Council community.

What’s more, I’ll be sharing some key findings and takeaways from the paper on an upcoming webinar on Feb 24 at 2pm Eastern featuring myself, Parature, from Microsoft’s Bill Patterson, and Peter Friedenberg of nTelos Wireless. Please join us (Registration required) and send over your thoughts and comments.

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