Are your customers getting a helping hand or the cold shoulder?

The great thing about big American businesses is that they give us many of the stories that become the fabric of our lives. Frankly, we'd rather not endure the circumstances that result in the stories, but like train wrecks and tornados, they are entirely unforgettable and we talk about them for years. I'm talking about customer service horror stories, of course.

We all have many of them. The stories get particularly interesting when they relate to monopolies or near monopolies, otherwise known as oligopolies. Why? Because any interactions we have with such firms are biased from the get-go by the distrust we have for important players in our lives over whom we have little influence and control. We feel victimized before we even pick up the phone to attempt to do business with them. From their business perspectives, this should present them with an interesting challenge: how do we make our customers trust and love us, so that they won't find ways to live without us? Unfortunately, such firms rarely seem to rise to the challenge.

A good example would be a very unpleasant run-in I had recently with my oligopolist ISP (Internet Service Provider). The setup for the story is that I moved about six months ago. I called my ISP during the move to have them disconnect DSL at my old address and transfer it to my new address-simple enough. Six months later, still no DSL; however, my credit card bill continues to be charged. I decided to give them a call, but having already called them three times previously in recent months, it's fair to say I was already not in the best of moods and pessimistic about the quality of service I would receive. Suffice it to say that they lived down to my expectations. The customer service interactions went like this:

1. My first call to them was, as expected, answered by the call center's auto-attendant. Similar to the voicemail systems that we all despise, the auto-attendant immediately proceeded into a long discourse on why I should "hang up now" (truly, its words) and give their online customer service capability a try. (Clearly, my ISP wants to reduce the expense of human-to-human interaction.) My first response was to say, "Nope, I want a person so I can clear this up NOW!" But after the lengthy intro, the auto-attendant went on and on with all of the self-service options, at which point I reconsidered, surrendered, and hung up as the stern voice had prompted me to do in the first place.

2. Then, having booted up my PC and signed onto the ISP, I navigated through their massive DSL self-help area ("Gee, I guess they have a lot of service problems with DSL," I thought.) I finally found the interactive customer support area, which appeared to require launching an applet of some sort. I'll never know how it works, however, since the program locked up as soon as I initiated it. I'll be darned if I'll try it again.

3. Fortunately, I was able to exit the ISP's "hung" software application without rebooting my PC, so I intrepidly went back into it in order to try another approach. I thought to myself that my problem was as much of a billing problem as a service problem, so maybe they'd be able to help me in their online billing support area. Again, no joy: I couldn't find a single bit of information about how to resolve a billing issue.

4. With a big sigh of frustration, I picked up the phone again. The horror story escalates to a new level at this point. I braved the big intro and all of the options again and finally got a human, who immediately sounded like she was having a bad day. "Uh oh," I thought. I explained my situation, to which she responded that it wasn't possible: her system was showing that DSL was still connected at my former home. I assured her that the phone had been disconnected months ago, to which she responded, "It MUST still be installed or else you WOULDN'T be getting billed." I said, "But THAT'S why I'm calling! I have a problem that needs to be resolved! By definition, problems are what you do NOT expect!" To that, she responded, "Sir, please don't get testy with me." Obviously, I could tell I was at loggerheads. The quality of the conversation was deteriorating by the second, so I asked to be transferred "to someone who actually cares about customer service." Her response: "My phone won't let me do that, sir, you're going to have to hang up and call back. I can't help you."

5. After taking a few minutes to compose myself, I called back. I went through all of the same automated cycles as before, but got a much friendlier helper this time. She sounded like she could have been from one of the Cornbelt states, so perhaps that had something to do with the improved attitude. In any event, her system also told her that DSL was still running in my former residence, but despite her incredulity, she was willing to show some faith and clear up the past charges to my credit card. Although she helped with the billing, I would have to be transferred to a DSL technician to find out about the installation of DSL in my new home.

6. Last stop, I hoped! I was transferred to the DSL technician, who brought up my account history on his work order system. "Hmm…," he said, "I don't see a problem here. What's your new address again? Hmm… I'm showing that the service went live at that address on April 13th." Since I was speaking with him six weeks after the supposed "live" date, I was incredulous at this point. Like a POW after six years of interrogation, I muttered, "But how could the service be on? I don't have any of those DSL filters connected on my lines and my regular phone is still working fine. A technician never came by the house either." Him: "Well, you don't actually always need the filters, sir, and we can get it running without always having to come by." Me: "Well, why wasn't I notified? It's unimaginable that it could be working for six weeks and I wouldn't know about it." Him: "Oh, we ALWAYS notify people, sir, you would have received an email." Me: "Hmm… Can you tell me when the email would have been sent?" Him: "No, I don't have a record of that, sir." Me: "Oh well, never mind. I'll try it out tonight and I'll call back if there's still a problem. Thank you." I don't think it dawned on the tech or the ISP that it may not be a great idea to send email to someone who is having difficulty getting online.

7. Later that night…DSL modem now hooked up, it worked. Simultaneous deep sighs of relief and great frustration echoed throughout Silicon Valley.

The scenario above is very common. For years now, companies have attempted to broaden their customer service capabilities and/or drive down operating expenses with e-commerce applications, technology-laden call centers, extranets, portals, Web or telephone self-service systems, voicemail, email, etc. All are attempts to provide critical customer care while minimizing the need for customer service personnel. For many companies, the cumulative effect of implementing these systems over the years is that the majority of their customer interactions are now decidedly non-human, or worse, inhuman. Electronically mediated customer experiences are those in which the customer interacts either directly with an automated system, or with a heavily technology-dependent customer service representative—a person who only knows what "their system" tells them. At Cooper, we call these customer interactions digital customer touch-points.

Upon reviewing the interaction I had with my ISP, which severely depleted my customer loyalty and put their revenue stream at risk, the digital customer touch-points I experienced (indicated in bold in the steps above) can be summarized as follows:

  • Three interactions with heavily technology-dependent personnel
  • Three tiring passes through the call center's auto-attendant
  • Two initiations of the ISP's communications software on my PC
  • One failed attempt to use DSL self-help
  • One failed attempt to use the online billing center self-help
  • Two indirect interactions with the call center reps' inaccurate customer information system
  • One indirect interaction with the DSL tech's work-order system

That's 13 interactions with digital customer touch-points. Lucky 13! And that tally doesn't include the fact that the first call center rep couldn't even transfer my phone call—or so she said. Grrrr! Although not being able to transfer a call may sound trivial, corporations should always endeavor to provide a smooth, unified customer experience. It is problematic enough when multiple touch-points are presented to a customer to solve a single service problem, but it is even worse when those touch-points cannot be seamlessly bridged.

Shouldn't we expect our "digital employees" to be well behaved?

When viewed as an aggregate, digital customer touch-points represent the 21st century front line of communications with a corporation's most critical asset: its customers. Therefore, they have the potential to impact revenues, customer loyalty, and the corporation's brand in the same ways as can the corporation's employees—for better or worse. Hence, we should all think of such touch-points as being "digital employees."

Top-tier companies carefully hire and train their customer service personnel. They do not view any customer-facing position as being insignificant. For example, Home Depot refuses to put untrained cashiers onto the sales floor for fear that doing so would lead to poor customer service and poor employee morale. Instead, their cashiers are given a full week of training to equip them with solid customer service skills and confidence.

I think we would all agree that Home Depot's thinking is sound and commendable. By extension, therefore, we should also agree that when companies replace customer-facing humans with software systems—digital employees—they should somehow "train" those systems to behave in ways that will satisfy the customer and help nurture long-term relationships. Home Depot knows that it would speak poorly of its corporate standards concerning customer service and operational excellence if it were to put an untrained cashier onto the sales floor. But what does it say about a corporation—like my ISP—that puts an ineffective customer support system into the hands of a call center rep, or a poorly designed self-service capability onto the Internet? Moreover, what example does this set for the remaining human beings in the corporation who continue to be tasked with customer service? If their employer only pays lip service to its customers, then why should they bother to do any better? Once this customer service and employee morale death spiral begins, I would contend that it is the beginning of the end for that corporation.

In his books, The Loyalty Effect and Loyalty Rules!, Director Emeritus of Bain & Company, Frederick F. Reichheld, makes the case for customer loyalty as being the key factor in achieving and increasing corporate profitability. In discussing the research he conducted with co-author, Thomas Teal, for The Loyalty Effect, Reichheld states:

"I documented the outstanding financial results generated by leaders who can build a measurable advantage in loyalty. By dissecting the microeconomic forces that link loyalty to profits, we explained the enormous growth and cost advantages of loyalty. We showed that in industry after industry, the high cost of acquiring customers renders many customer relationships unprofitable during their early years. Only in later years, when the cost of serving loyal customers falls and the volume of their purchases rises, do relationships generate big returns. The bottom line is this: An increase in customer retention rates of 5 percent increases profits by 25 percent to 95 percent." [1]

In Loyalty Rules!, Reichheld builds upon the case he establishes in The Loyalty Effect by creating a link between customer loyalty and employee loyalty:

"Customer loyalty hinges, as it always has, on committed teams of high-caliber employees and suppliers, which in turn require a core of owners committed to building an enduringly successful enterprise." [2]

So, employee training, employee loyalty, customer loyalty, and profits are linked, yet businesses are endeavoring every day to reduce employee interaction with customers. This begs the question: Are corporations potentially undermining their own success by de-humanizing their customer service functions with digital customer touch-points? If corporations are going to rely upon such touch-points, how can they be assured that they will adequately replace a human's ability to genuinely care, to go the extra mile, to provide insights into cross-sell opportunities and operational problems, and to maybe even provide the goodwill created by a warm hello or a little friendly banter? Unless corporate executives have evidence that their technology teams have thought through these issues in painstaking detail, it is incumbent upon them to start asking some very serious questions:

  • What is the business risk associated with replacing a human interaction with a digital customer touch-point? What might we lose in terms of dollars and brand by distancing ourselves from our customers?
  • If implementing a digital touch-point takes away a human interaction that the customer perceived as valuable, what can we provide them in return to make them feel whole again, or maybe even better off than they were before?
  • When was the last time, if ever, that we assessed the quality of the customer care being provided by our digital customer touch-points? What risks are we absorbing without that risk being tracked, measured and managed? What kind of program can we put in place to mitigate this risk and remedy any deficient situations?
  • Who do we have in charge of our digital customer touch-points: someone trained in humanizing technology experiences, or the IT people who implement networks and configure PCs? In other words, what are the qualifications of the people who are creating our face to the world, and managing the experience of our #1 asset?

Get with the program! An action plan any corporation can follow

Executives need to view their digital customer touch-points as either potential friends or potential foes; as either windows of opportunity or windows of vulnerability. Once a corporation decides to start opening these windows, it needs to be very careful about the quality of the services it passes through them. If an executive cannot get clear answers quickly to the important questions above, then a plan of action is needed immediately. Here is an approach executives can follow to begin to manage the risk associated with their digital customer touch-points:

  1. Create service standards and a corporate value system. Establish baseline standards of customer service excellence: objectives, philosophies, attitudes and general approaches.
  2. Communicate. Explain and repeatedly assert the corporate beliefs to all employees. Let them know that excellent customer service is job #1, and that the customer loyalty it inspires is the key to the corporation's future success-and to their future employment.
  3. Go on a witch-hunt. Search out, characterize, and catalog all digital customer touch-points throughout the corporation.
  4. Assess risk. Classify each touch-point by level of business risk. Identify and quantify, if possible, the revenue volume associated with each touch-point. In other words, measure what is at stake at each digital customer touch-point. Don't forget intangibles, like brand.
  5. Prioritize. Beginning with the highest risk touch-points, perform customer research as necessary to clearly identify customer goals and needs.
  6. Assess effectiveness. Use scenario-modeling techniques to simulate customer experiences. Analyze the effectiveness of current touch-points and operating procedures in satisfying the identified customer goals and needs.
  7. Summarize. Prepare a comprehensive report summarizing the overall quality of the corporation's digital customer touch-points. List inadequacies on a revenue risk-prioritized basis.
  8. Plan. Outline and prioritize the remediation effort. Prioritize on a "risk per dollar of cost-to-remedy" basis. Identify necessary resources. Prepare a budget.
  9. Measure. Identify the key metrics that the renovations will endeavor to improve; create baselines of existing performance based on available data. Circle back to these metrics after improvements have been made. Measure success.
  10. Implement. Your customers' loyalty and your revenues are hanging in the balance. Begin this customer-centric program ASAP.

In summary, Charles L. Fred, author of Breakaway: Deliver Value to Your Customers - Fast!, articulates the strategic importance of customer touch-point management very clearly:

"Consumers care more [today] about service quality than they did during the high-flying days of the 1990s. They have less money to spend, they are more discriminate about what they buy, and they are less trusting. The absolute unilateral focus must be delivering on promises. The companies that break away will have a pure external focus on the customer. They will think about gaining new customers, keeping the ones they have, and coming up with new ways to wow the customer." [3]

Manage your digital customer touch-points as if your corporation's very existence depended on it. Your customers and your shareholders will thank you.

[1] Frederick F. Reichheld, Loyalty Rules!, (Boston: Harvard Business School Press, 2001), page 10
[2] Ibid, page 2
[3] Fast Company, "How to Lap the Competition," April 2002,