Friday, June 26, 2009

Customer Experience Pt 7 - Leadership

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

So we now have measures against which we can track how our aims for customer experience and internal culture are being delivered. Arguably we could stop at that point and there is a school of thought that stems from some lean practitioners which suggests frequently publishing performance measures is enough to elicit consistent improvement against those measures. Sadly, in my experience, that’s rarely the case and to achieve sustainability and improvement strong, supportive, directional and inspirational leadership is key.

Enough time?

That visible Leadership has to come from every manager in the organisation from the Board to team leaders. Unfortunately, all too often, I see managers managing, but not leading. A simple test for this is to look at a manager’s weekly diary and try to identify what proportion of each day is spent talking to and coaching those that report to them. Often that time simply does not exist as their weeks are filled with back to back meetings or other ‘important’ administrative tasks that take them away from being a role model for the teams they lead and often add little tangible value to their customers i.e. those that report to them.
A fast and simple way of alleviating that issue is to list all the tasks a manager has to do each month in order of importance. Often those at the end of the list aren’t critical to the businesses’ performance and are there ‘because we have always done that’. A conscious decision can then be made, balancing those less important tasks against the benefits of developing an enhanced internal culture and consequently improved customer experience. Being brave enough to change the status quo and stop a few unnecessary routine tasks can create a significant window of opportunity for leadership rather than just management. Sometimes however it isn’t as easy as that (often in regulated environments) and this can lead to a piece of organisational development work to establish what processes can be simplified and/or delegated up or down the line to free managers’ time to lead. Either way, this issue must be addressed as it is crucial to the development, sustainability and consistency of customer experience.

Another leadership challenge

That’s likely to be the hardest part, but there can be another key leadership issue to address. In the same way as we previously looked at recruiting for attitude, some managers may have historically been recruited or promoted for their knowledge or on their ability to complete tasks to a high standard rather than their leadership potential. Once the volume of tasks has been reduced and these individuals are expected to interact with and lead their teams on a daily basis, these managers can find themselves very exposed. A full suite of leadership skills training should be made available to them, particularly focussing on goal setting, coaching, and dealing with conflict. Many may respond well to this support and relish the new challenges, but some will not and, sadly, if they cannot transition from managers to leaders, they must be removed from their positions. That applies to all levels within the organisation including the Board.

Measurement again

That is where the benefit of the individual accountability within the measurements, both internal and external (referred to in the last article) comes in. That detailed measurement creates the opportunity for managers at all levels to identify both outstanding performance against the desired aims for recognition and poor performance for coaching and support, so making the most effective use of the time available to them. In this way, providing the aims of the business have been clearly articulated and the measures have been skilfully aligned to those aims, the managers can start to lead the behaviours that will deliver those aims rather than just reacting to the operational performance results. It is this leadership informed by frequent measurement of outcomes that gives the organisation its consistency and sustainability when embarking on a customer experience development programme.

Wednesday, June 17, 2009

Customer Experience Pt 6 – Measuring Outcomes

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

So, we have identified what business culture is and put that in the context of the overall operational structure. We have looked at how to explicitly shape that culture and engage both existing and new employees with the internal culture and how it is externally reflected to deliver a defined and distinctive customer experience. That should be enough then. Well sadly it usually isn’t. The first challenge given how intangible culture can be is to measure if anything is getting better for the business and its customers, otherwise what’s the point? For some businesses that can actually be the starting point in this process i.e. identifying, through measurement, what you want to improve and then taking action on the factors that are most likely to affect it.


Writing generically, as I’ve said several times before, it’s impossible to be prescriptive on what should be measured. The one common rule however is to try and predominantly measure outcomes rather than the actions that lead to them.

Using measurement as a starting point for the whole programme can be a useful and often essential discipline as it can also help create a business case for embarking on a programme to improve customer experience and the internal culture that supports it. Depending on the business you are in, directly correlating financial business performance to improved customer experience can be a challenge. However, for most businesses, the two most tangible benefits are likely to be:

Customer loyalty, defined as repeat business from an existing customer base and....
Customer advocacy, defined as word of mouth marketing to increase market share

Any business that requires documentation of a customer transaction should find these measures fairly easy to track and consequently it is relatively straightforward to assign financial benefits to improved customer experience. However, many businesses don’t have the ability to track individual customer transactions with the consequence that any actions to improve loyalty and advocacy have to be based more on common sense, gut instinct and often ‘a leap of faith’ rather than hard figures.

Perfect Sense

Of course it makes perfect sense that if you offer a great experience that is better than your closest competitors you will engender loyalty within your existing customer base, grow market share and you will see turnover increase. However, without each customer transaction being documented a hard-nosed Finance Director will always question whether an increase in turnover can really be attributed to an improved internal culture and customer experience or other factors. I believe that is the stumbling block for many organisations trying to find financial support to embark on such a programme and one of the reasons for the commonly held belief that service in the UK is getting worse while efficiency of process, products and services are generally getting better.

Other measures can go some way to mitigate this and the key two are:

Direct customer feedback and......
Mystery shopping

Customer feedback is essential for any business looking to improve their customer experience. This can be collected through comment cards, focus groups, exit surveys, telephone polls and perception surveys from recent customers. However the questions you ask can determine the results you obtain and need to be crafted to reflect a blend of the service that was delivered, the overall experience and the consequent perception of the business (and therefore the likelihood of future business and recommendation). At its simplest a question such as: ‘were you satisfied with your transaction today?’ will be much less revealing than: ‘how did you feel about the way we treated you today?’ The first will identify if the customer was satisfied, whereas the second will tell you how likely the customer is to return and recommend to others, which is so much more important.

Many businesses stop at customer feedback, but it’s not really enough. If you have been truly aspirational in the ambition for your customer experience you need more. Customers will, quite naturally and perhaps subconsciously, base their feedback on comparisons with your competitors. That’s not to suggest their views aren’t important, but the results inevitably will be based on their satisfaction compared with similar experiences and consequently won’t help you achieve a point of differentiation – in other word you’ll stay in the game, but no more. If you really care, that’s not good enough which is where mystery shopping comes in.

Mystery shopping offers you the opportunity to measure performance against goals that existing customers can’t even imagine, or at least it does if you customer experience ambition is high enough. Mystery shoppers should be directed at delivering a combination of objective and subjective feedback, but most importantly, if you have identified an aim for customer experience development that will be a unique point of differentiation for your business, unlike real customers, they can be directed to report on your progress against that aim.

Even More Measures

So that’s what we measure externally, but part of this programme is based on the internal culture so that must be measured too. For the Finance Directors/business case, the hard measures must be:

Staff turnover.....and
Staff absence

It’s obvious that a happier workforce is likely to be more stable and have less absence and any business can put some hard figures around both measures. However, less defined but just as important, is the staff survey which will put some detail behind the high level hard statistics. As with the customer surveys the questions you ask are key to the results and questions such as: ‘do the facilities at work meet your needs?’ and: do you think this business is well run?’ will identify the organisation’s efficiency, questions such as: ‘does your line manager value your contribution?’ and: ‘do you have a best friend at work?’ will tell you much more about the culture you are creating.

Wherever possible, both external and internal measures should link back to an individual’s performance and next time we shall explore the benefits that brings.