The secret to driving service as a business differentiator

Remember when Service was the “only” differentiator?  That was when most all business was local business, and most of it happened on Main Street in your town.  It wasn’t the packaged goods at the grocery, or even the produce. It was your friendly and knowledgeable grocer.   Was the whisky at the bar or the coffee at the café or the ice cream at the diner the differentiating factor?  Nope.  It was the barista or the soda jerk or the bartender that knew your name, your favorite beverage or treat, and knew your dog’s name too.  Great companies know this.  Great brands leverage and exploit it.

Large and small service organizations are challenged on many fronts today. They need to improve service, control delivery costs, maximize business revenue and reimbursements, and attract and retain customers to grow.

But as the leader in an organization where service is the most significant differentiator, where should you put your emphasis?  Is there a business case or example where tangible return was driven from the people and dollars invested?  It has been difficult for many organizations to “connect the dots” between service quality and specific bottom-line results. 

Introducing the Service-Profit Chain

This very academic/scientific diagram is based upon the work of Service Profit Chain Institute. Does it make common sense, or do thoughtful people really even question the relationship of corporate financial success to company processes (policies) and worker satisfaction and engagement?  What is your experience in business on this matter?  Do most executives “get” this connection?

Healthcare is an interesting case in point.  Lots of money, lots of risk, and many high-value customer “events” or “interactions.”  Recently we met with a healthcare executive who asserts that everyone in their hospital needed to be focused on the quality of the experience of those being cared for.  This executive understands that employee engagement and satisfaction is the gating item for the quality of each and every customer interaction.  In this industry, worker engagement and satisfaction is widely accepted as the primary drivers of performance across each and every customer transaction and interaction. The message is clear for healthcare and every industry: put your attention on employee engagement.   Bottom-line will follow.

Back to our diagram: What are the “inputs” to service employee satisfaction? Is there a formula or rule-book?  Is it really just good common sense for experienced and inspired managers?  We believe it is good common sense that every organization can access.  It’s basic blocking-and-tackling fundamentals. Yet they often get lost in the hectic day-to-day and Quarter-to-Quarter chaos.  These include the following:

-Workplace design

-Employee job design

-Employee selection and development (and training)

-Employee rewards and recognition

-Employee tools for serving the customer

-Frequent feedback mechanisms for consistent “listening” by management

We recently asked users at WorkersCount whether they felt that they were getting the training and help they needed to succeed. Only 21% said this was frequently the case; and 58% said it was only occasionally the case. Great organizations put strong emphasis here.  Yet why was this receiving such a mediocre result from workers across over 300 enterprises?

To be clear, it is important to improve the quality of “business processes” for employees and the customers that they interact with.  What are these “business processes?”  They are the way leadership has designed the day-to-day “standard operating procedures” (both formal and informal customs and ways of doing things and handling customer interactions and policy). 

Put simply:  Are leaders making it more efficient and effective for employees to work with customers in front and back office environments, or are they making it harder to deliver positive interactions and outcomes?  What would employees say about their level of empowerment to do the right thing for the customer?

Combining all this determines employee satisfaction, engagement, empowerment and ultimately, employee retention.  One great organization can’t even say in a few words “what exactly” makes them excellent, because their sense of customer interaction spans over 100 individual “touches” over the course of a transaction.  It is holistic for them.  Customer retention, satisfaction and referrals are their metrics, and the organization only feels those impacts after-the fact or indirectly over time.  Not at the end of each transaction.  The small insight that keeps this company at the top in earnings, brand value and customer loyalty—they understand that their business results are driven by employee engagement, empowerment and job satisfaction.

A case study that proves the point: Quality of service becomes a business differentiator

Several years ago, Sue Nokes moved T-Mobile from the bottom to the top of the JD Power survey.  Sue did this by implementing a simply philosophy: “Making the customer happy is a lot easier to do when employees actually like their jobs and feel that what they do matters.”  With consistent focus on her employees, customer service became a key business differentiator for T-Mobile.

So how bad was it at T-Mobile? Before committing to accepting the job, Nokes visited a few call centers and was horrified. Absenteeism averaged 12% daily; turnover was a staggering 100%-plus annually. The company used "neighborhood seating," a common technique at call centers in which employees didn’t even have regular desks but instead dragged their stuff from cubicle to cubicle.

In her first meetings with her direct staff, Sue asked her managers, 'Are you losing any good people?' They said, 'yeah’.  She retorted, 'anybody feeling bad about that?” She then asked them two questions: “What's going well, and what's broken?" Nokes also, launched a listening campaign, asking what customers were complaining about and what employees needed improved in their workplace. In one focus group, everybody came out crying. The people said they had never felt so inspired in their lives, and that they had never met with any leader at that level who cared.

Nokes then gave employees their own seats and got $17 million to bring salaries up to the 50th percentile. She also overhauled the training process (reps receive 132 hours of training and team meetings each year) and began hiring based more on spirit and attitude than experience. She created a standard set of metrics to measure reps on tracking call quality, attendance, and schedule reliability along with the speed of the call resolution. Nokes told her team that she would never hold them accountable for “things that don't matter to your customer or to fellow employees.”

Finally, to motivate employees in what has long been considered the service desk a dead-end job, Nokes promised that 80% of promotions would eventually go to existing employees. She even put in a "rewards and recognition” system in which high performers were rewarded with fun trips to Las Vegas or Hawaii and prizes. Today absenteeism is at 3% and attrition is at 42%, a very low number in call centers.  And most importantly, employee satisfaction moved to 80% - the highest it's ever been.

One of the big techniques Sue and other great brands leverage is the often-forgotten one of listening.  It’s easy, and it’s one of the least expensive ways of discovering what’s working in an organization and what’s not working.  Both discoveries are like gold.  Yet companies stumble over the process, often making it a burden, or a chore, or a scary process filled with threats or “remediation.”

The best leaders are always the best listeners.  Do you have a mentor that listens to you?  Are you committed to engendering a workplace that values listening and authentic, frequent feedback?  Do you have an organizational value system that holds your workers in trusted positions as “experts” in their respective roles?  If you do, you’re among the vanguard of top leaders.

At WorkersCount we’re all about enabling and empowering workers to have voice, and companies to hone their listening skills.  By creating daily, real-time feedback channels that are safe, simple and easy to implement, companies that use WorkersCount become ninjas at listening and acting on the advice and feedback of their best experts--- their workers and customers.   And that always hits the bottom line in a positive way.