How to develop and improve Customer Satisfaction - Part Two
In the first part of our Customer Satisfaction series we looked at the role of managment and the need to define customer needs. In the second part of our article we'll look at other tools and methods that can be used to improve customer satisfaction.
3/ Alignment of Business Structure with customer requirements
With the customer’s needs identified and the business embracing a customer focused strategy – organizations should also consider aligning their organizational structure against the needs of the customer. In “Beyond Customer Satisfaction” (1996) author Keki Bhote defines four stages of organizational evolution towards world class customer satisfaction and loyalty. Bhote defines organizational structure evolving from vertical “functional” management to Cross Function Teams, with the aim of the business to provide value to the customer and focus on customer loyalty.
Organizations need to consider carefully where customer interfaces occur and the whole organization should be positioned to facilitate customer interaction. Many opt for a single point of interaction an “Enterprise Service Desk” which has total ownership of all customer contact. Some organizations have developed teams whose sole responsibility is assessing potential customer needs ensuring that information gets communicated to the relevant services and sales teams of the business.
Whatever the structure, customer service should be considered at all levels of the organization from R&D through to design, manufacture, sales and after care.
4/ Measure and Analyse
One of the key tools to help improve customer satisfaction is effective measurement and analysis. Historically many organizations have chosen to estimate customer satisfaction which has resulted in an incorrect assessment of performance. Clearly should you want to know how satisfied a customer is you need to ask.
The most popular method of customer satisfaction assessment is the questionnaire. Many organizations use customer survey questionnaires comprised of a series of questions and weighted results which produce an overall assessment of performance. Measuring customer satisfaction can be complex to execute with response rates to questionnaires averaging around 3-5% many organizations choose to outsource this activity to third parties. The benefits of this is that many organization don’t necessarily have the appropriate tools or skills in house to undertake this activity.
Whatever the assessment method, a key target of measuring customer satisfaction is to isolate and decipher influences that drive purchase decisions. Once obtained it is important to categorize and structure the feedback as it arrives. Typically this may mean tracking the influence of different customer satisfaction attributes over time and benchmarking within the industry. Many organizations are increasingly looking towards customer satisfaction programs where the data forms an input into a continuous improvement activity. The most important thing is to ensure that once the data is obtained it is used proactively.
5/ Have Effective customer focused Processes, Procedures and systems
Having focused staff and an appropriate structure will not drive results on their own a business requires the correct processes and systems to facilitate results. Traditional business processes tend to be inward facing aimed at satisfying the requirements of senior management, in contrast customer focused organizations have processes that reflect and support the customer’s needs.
When constructing processes it is important to understand the impact that different service levels has on customer satisfaction. Incorporating traditional improvement idioms such as “Plan Do Check Act” into management systems can have the affect on building on feedback and incorporating it into improvement programs.
Increasingly there are many formal examples and systems to facilitate best practice – for example ISO 10002:2004 which describes best practice for complaints management. Benchmarking programs focused on developing world class customer service focused organizations are also prevalent and can help in highlighting superior business processes.
Technology can also be exploited to improve customer satisfaction – software vendors increasingly suggest a single “end to end” solution to manage contact data as a critical success factor. Research by McKinsey & Company suggests that companies that have a strategic approach to customer satisfaction and make technology investments to support objectives are likely to achieve high rates of customer retention.
In 2005 the Global CRM market was worth $3.2 billion (AMR Research) and most if not all the leading software solutions providers are developing products targeted towards customer management and retention. The Functionality in these products range from contact/customer management through to feedback systems, complaints and feedback systems. Increasingly many of these applications are available as hosted solutions.
However, such systems are still only widely used by larger organizations. A study by AMI-Partners in 2007 showed that only 1 in 12 small businesses currently used CRM and the same percentage intended to implement such systems within the next 12 months. Clearly the CRM market will continue to expand as the low to mid market embraces such technology.
Finally in today’s web enabled economy, customers are increasingly responding to self serve systems – particularly those that are focused on delivering simple, informative and fast customer experiences providing customers control over their interaction with a company. As the internet continues to expand, technology will have more influence over customer retention and organizations should think carefully of the impact on technology projects.
Ultimately, there are a range of factors which organizations can shape and influence. Each of which can impact customer satisfaction – ultimately there is no single answer. Business strategy must embrace customer satisfaction as it’s top priority, assessment programs of customer needs should be continuous and long term development of resource and technology strategy should be focused towards delighting the customer. Ongoing analysis as part of continuous improvement programs will facilitate business change and provide focus on what drives satisfaction and conversely what drives dissatisfaction and thus enable it to be eliminated.