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Why “Smile Training” Alone Is Not Enough

While waiting in line – a long line I might add – at the local supermarket, I noticed that the cashier was attempting to remain pleasant with the customers. She was handling both checking and bagging duties. By the third customer the smile was starting to fade. Upon reaching the checker with my groceries, the smile was gone. The normal greeting of “Find everything ok sir” or “How are you today sir” was not extended. I asked if she was okay. She appeared puzzled by the question. I asked, what is the one thing that she could use right now to which she immediately replied “Some help!” I bagged groceries as she checked to cut down on the transaction time. During this process, I asked if she received any customer service training. She replied “Yes, we are trained to be courteous, upbeat and to always smile”.

“Smile training” alone is not enough in the customer service arena. One can be trained to be courteous, utilize active listening, paraphrase for clarity and focus on solutions and still be less effective with the customer if working within a system that is not conducive for successful customer interactions. In the story above, assistance from a bagger would have created a more positive experience for the cashier and the customer. The utilization of time data to create customer traffic models would allow management to anticipate peak periods and provide proper staffing of checkout registers. It’s the creation of a good system that leads to positive employee morale (which leads to higher employee retention), increased customer satisfaction (which leads to higher customer retention) and higher profitably.

“Smile training” is but one component of customer service delivery. The systemic viewpoint of customer service takes into consideration the functionality of the whole business operation. Are the business processes as efficient as possible? Were the processes built with the input of those who are actually performing the processes? Is there agreement in determining how service delivery is measured? While an operations analyst for a major newspaper, I was monitoring a conversation between a call center associate and a customer regarding a marketing campaign. It appeared that the customer knew more about the campaign than the associate! The associate was heard asking the customer to “read the information that you have to me please”. After the call was completed, I asked if she was aware of the marketing campaign, to which she replied “No”. I quickly surveyed other associates with the same question and received the same answer.

The marketing department was my next stop where the question posed was “Does the call center get the information regarding your various marketing campaigns?” The marketing department associate meekly replied “No”. Although the call center associate remained nice while handling a tough situation, the experience was not a smooth or pleasant one for her or the customer. In addition, the call length was extended unnecessarily, which adds to the time calls wait in queue, which can lead to a higher rate of abandoned calls. The associate’s productivity is negatively impacted which can lead to negative performance evaluations, which can lead to negative employee morale as the associate feels he/she has no control over the situation. The inclusion of the call center in marketing campaigns erased the type of interaction mentioned above. A systemic culture prompts one to think about who/what is impacted by one’s actions. This slight pause allows for the creation of a better process.

A systemic mindset is required for a complete customer service experience. Employees are more effective and happier when working within a system that supports their efforts to provide a good customer service experience. “Smile training” is an important cog in the customer service wheel, but should not be solely relied upon for great customer service delivery and positive employee morale. Create a “systems” oriented company to insure the delivery of great customer service!

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The Financial Impact of Customer Service

Customer service is what drives the success of the any business. Some would surely say, “No Errol, a great product or service concept drives the success of any business.” While that statement is somewhat true, a great product or service concept without great customer service is like expecting your beautiful garden flowers to flourish without your giving attention to them. I have often found that you don’t get upper management’s or the owner’s full attention regarding customer service unless you provide the financial impact to the company. Customer service has a dual role as it both creates and preserves revenue. Let me explain why I believe this to be true.

Customer service creates revenue via the word of mouth avenue. When a great product or service is coupled with great customer service, your customers become your ambassadors. Their willingness to speak positively about your business leads to additional customers, thereby creating additional revenue. Recent research by the Technical Assistance Research Program (TARP) indicates that for every 10 people hearing either positive or negative “word of mouth” information, 1 person takes action. That one new customer, should they receive the level of service expected, will in turn keep the positive “word of mouth” cycle in motion. Another form of revenue creation as a result of great customer service are price increases. TARP has also studied the impact of price increases on the customer’s willingness to continue to do business with companies. In a study of the banking industry, only 10 percent of survey respondents who had not experienced a customer service related problem expressed dissatisfaction with an increase in fees and charges. This means that 90 percent of survey respondents were okay with the price increases due to the level of customer service provided by their particular bank.

In regards to customer service acting as a revenue preserver, there is one question that must be answered before we continue. That question is – How much is your customer worth to your business? Whether your company is small or large, the need to determine what your customer is worth to your business is critical when calculating the amount of revenue being preserved by addressing customer service related issues. For example, if your business has 1,000 customers and the average annual revenue generated by each customer is $400.00. If 10 percent of those customers experience customer service related problems, that’s 100 customers. Bear with me as we start the calculations! Now let’s assume that 50% of those customers don’t even bother to complain, they just simply go away. Their decision to leave without complaining represents $20,000.00 in lost revenue. What about the other 50% that do complain? Let’s say that you’re able to satisfy 40% (20) , 40% (20) become frustrated with your attempts to satisfy and 20% (10) remain dissatisfied. So now let’s consider the repurchase behavior of those complaining customers. Should 10% (2) of the customers that you’re able to satisfy after they complain decide to not repurchase, that represents $800.00 in lost revenue. In the frustrated with your attempts to satisfy group, 25 % (5) discontinue purchases with your company, which represents $2000.00 in revenue. On to the customers that remain dissatisfied after complaining – 60% (6) of this group decide not to repurchase from your company, which means an additional $2400.00 in lost revenue. The total potential annual revenue lost in this scenario is $25,200.00! Wait, there’s more. Remember the “word of mouth” factor discussed earlier. These dissatisfied customers will tell others about their experience with your company. In this scenario, when you consider the 50 customers that left without complaining, add the 13 customers that complained yet decided not to repurchase, that’s 63 customers who have the potential to utilize negative “word of mouth” marketing. If these dissatisfied customers tell 10 additional people about their experiences (630 people) and 1 in 10 acts on the information (63 people), there’s potential revenue missed due to dissatisfied customers. Even if the new customers average annual purchases equals $300.00, you’re still possibly facing $18,900.00 in lost potential revenue. Don’t forget about the cost side of poor customer service – the employee costs to resolve customer complaints and the material costs when rework is required to satisfy the customer. Take this example and apply your real numbers to determine the financial impact to your business. Whew! Lots of calculations, but it’s definitely worth it when it comes to determining the financial impact of customer service.

The key to preserving revenue is to: 1. Be consistent in your service delivery and 2. Encourage your customers to complain. Consistency in your service delivery leads to loyalty, less complaints and even more important, fewer reasons for the silent defections of the non-complainers. Encourage your customers to complain as this gives you an opportunity to retain their business. The example above illustrates the financial impact of non-complaining customers. Offer multiple ways to complain – at the point of purchase, on your website, via chat, 1-800 #s. Don’t forget to monitor social media for comments regarding your company and respond to the complaints in a timely manner. Remember, don’t take customer service for granted. The financial impact is huge!!

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There’s Nothing Wrong With This Chicken!

This month’s real life customer service story comes courtesy of a good friend here in Houston, Tx. He writes: “After a long day at the office, my wife and I decided to stop in at a well-known franchise location for dinner. The cashier was professional, friendly and exhibited an enthusiastic personality. We ordered our meal which was served in a timely manner and with a smile. As I began eating my chicken breast, I quickly noticed the inside was not fully cooked. I immediately took the chicken breast to the cashier. She apologized and summoned the manager to the counter. As the cashier showed the manager the inside of the not fully cooked chicken breast, the manager looked at me and said, “Nothing is wrong with this chicken. This is how it looks, it’s okay.” I informed the manager that this chicken was not fully cooked and asked for a chicken breast from a different batch to which the manager replied “This chicken is good. I’m not replacing it. People eat it like this all the time.” The manager then turned and began walking away. I said to the manager “Excuse me, you’ve got to be kidding me! Is this how you treat your customers when a concern is brought to your attention? Let me get your name and the regional manager’s name and phone number.” The manager tore a piece of cash register tape, circled the store number and said “That’s all you need” as she turned to walk away. I wrote down the names that were on the employee’s badges, saved my receipt and proceeded to leave the premises. My wife and I were both speechless and shocked at what had just occurred. How did a visit that started out with such amazing customer service go so badly so quickly?’

Wow! To think that this bad customer service experience resulted from the manager of this establishment’s choice to not acknowledge the customer’s concern or perspective regarding the undercooked chicken. It’s always a good idea to acknowledge the customer’s concern as this makes the customer feel valued as a person and as a customer. How much is the cost to just give my friend another chicken breast? Probably not very much at all. Now consider the cost of not replacing the chicken breast – A call to the regional office. Sharing the experience with others. On another note, the manager did not model the proper behavior in front of the cashier. The manager should set the tone for those over whom they have responsibility. In my opinion, how can this manager discipline the cashier should she exhibit poor customer service if the manager does not bother to exhibit basic customer service skills? As a manager, remember that you set the tone for your operation and for those over whom you have responsibility. Don’t forget to acknowledge your customer’s concern and resolve the situation to the satisfaction of your customer – in this case – just give the customer another chicken breast!

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She Earned It!

Laurenzo’s Restaurant, located at 4412 Washington Avenue here in Houston, Tx is a pleasant place to dine. My wife and I stop by occasionally when we’re out cruising. Our favorite waitress at Laurenzo’s is Candace Roberts. Candace’s customer service skills are second to none. We ask for her specifically when we drop in. Her personality and sense of humor makes her an easy choice for a “Now That’s Customer Service!” award. Upon our arrival to present the award, we were greeted with the biggest hug from Candace, not because she was receiving an award – she had no idea that she was receiving it, but because she was just glad to see us! I have observed Candace’s customer service  style with her customers during our visits. She treats everyone like family. Candace is consistently great at providing great customer service! Her attitude and demeanor are a perfect fit for the customer service industry. Her attentiveness makes us feel as if  we are the only customers in the restaurant.

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