Tuesday 24 April 2012

Customer Service excellence– right first time, every time


The customer is now emperor
We all have horror stories to tell about hanging on the phone for ages listening to some terrible ‘muzak’ version of Vivaldi’s Four Seasons while waiting for a customer services advisor to sort out a problem. And how often is that wait in vain? How often is the problem resolved there and then? How often do they actively come back to you afterwards to check on your satisfaction or the progress of a fix? In my experience, excellent customer service is still as rare as hen’s teeth!

Maybe it is just me though. I have high expectations. I expect that things will work first time and if they don’t I expect to have them fixed immediately. But when I speak to friends they too are becoming less and less prepared to accept shoddy service from organisations that should know better. 

The rise of the interactive internet through Facebook and Twitter has encouraged consumers to shout about their complaints in a very public way. The more that do so, the more likely a company is to improve its goods and services for everyone. If in the old pre-internet days the ‘customer was king’ now in the days of the interactive web, surely ‘the customer is emperor’.

Improvements are out there
A couple of my recent examples of good and bad customer service spring to mind. I recently wanted to open a saving account and following internet research selected an account that required me to visit a bank’s branch in person. Not ideal but I accepted the reasons given. I didn’t make an appointment in advance but just turned up on the off chance that I could see someone to resolve my need. 

Of course, all the staff were busy with full diaries but one guy checked his calendar and said he would fit me in there and then without impacting his other appointments. Fifteen minutes later and my account was opened and my assets transferred. Now the bank in questions has faced criticism in the past for the quality of its customer service but on this occasion Santander should take a bow. I left a happy customer and am now writing about my positive experience.

Still wrong second time around
On the other hand, my recent experience of Toshiba UK’s customer services is quite the opposite. My laptop is still under warranty and this warranty covers the power adaptor which failed recently. Having spent 30 minutes on the phone trying to get the technical support staff to recognise that I had a valid extended warranty at all, they finally raised an order for a replacement adaptor to be sent to me in 2-5 working days. I changed appointments to ensure I would be around for delivery.
 
At the end of this period I still hadn’t received the adaptor so I called back – another 25 minutes on the phone – to find out that an internal problem with their ordering system had meant that my order hadn’t been placed at all. Naturally, I raised my concerns but there was apparently nothing that could be done. They could re-raise the order but couldn’t expedite the delivery or offer any compensation for their error and my wasted time. So I was left waiting another 2-5 working days for my adaptor. 

To be fair to Toshiba, they did offer to email me an update of my new order with a tracking reference but the part, which did eventually arrive some 10 days after my original call, was delivered to the wrong address! So despite all their extra efforts they couldn’t even get it right second time around; hardly what I would call good customer service. 

This experience certainly leaves a sour taste in my mouth, encourages me to write this negative blog about a business that should know better and will make me think long and hard before ever buying from Toshiba again.

Constrained by systems and procedures
In thinking about these experiences, it strikes me that where many businesses are going wrong is that they see customer service as an add-on, as an additional cost, as a reduction on the profit they made from selling the item in the first place. It is something to be tolerated and monitored and minimised. It is a necessary evil that needs systems and procedures to control it.

In none of my experiences of customer services are the people at the end of the phone at fault. They are trying their best, I am sure, to help me but they are constrained by the lack of understanding of the customer’s perspective in those systems and procedures that they are obliged to work with. They are often not empowered to resolve the problem there and then but rely on other people or processes to swing into action. These, as we have seen, can be unreliable and time consuming and completely customer unfriendly.

Excellence as a differentiator
Customer service should be seen as a positive differentiator, part of the sales and marketing process and a fundamental asset of the business. Assets must be invested in if a positive return is to be achieved and customer service is no different. A good experience of customer service results in a happy customer who will be an advocate for the business. A bad example will not only mean a potentially lost customer but also a motivated antagonist who is likely to tell friends and colleagues of their bad experience. 

The problem is that all businesses know that this is fundamentally true. All talk the talk but few of them really commit to doing something about it. Generally speaking, call centres that measure the throughput of calls and monitor the time taken on calls rather than measure the satisfaction of customers are indicative of this ‘lip service’ approach.

Right first time, every time
Of course, if things were right first time then there wouldn’t be a need for as much support to fix subsequent problems. This would allow the customer service team to focus on fewer calls, too. The best businesses focus on ‘right first time’ and then measure and analyse the nature of the calls into call centres and focus their resources on resolving the majority there and then.  They think like customers and understand the power of the satisfied consumer.

This is something for start-ups and small businesses in particular to think about. Put the right attitude towards your customers at the heart of everything you do from day one. Build your products and services around delighting your customers and they will buy and buy again from you. And keep working at it. Getting it right from day one and keeping it right on day 1001 are very different things. 

If you do it right consistently and systematically you will see huge competitive advantage over those small and not so small businesses that are still getting it so wrong. Time taken getting your product or service ‘right first time’ will pay real dividends in the future and time taken to resolve customer problems quickly and fully will ensure a loyal customer base. 

It is all just a matter of common sense, really. Sadly, from the consumer’s perspective, the opportunity to be better than the rest is still there. I would like to think that this opportunity will be short lived as businesses truly realise the negative cost of poor customer service. But in truth, I am just not so sure.

Tuesday 17 April 2012

Intellectual Property – the solid foundation for investable businesses


What is Intellectual Property?
Intellectual Property (IP) is a bit of a mine field. As a term, it encompasses a wide range of rights recognised by various laws in various geographies covering legal copyright, trademarks and patents among others. As a concept, it is hotly disputed as to whether it contributes positively to innovation or restricts it. As a legal framework, it is so varied on an international basis that trade disputes and legal challenges are the bread and butter of an army of lawyers.  As a practical tool for protecting the ideas of inventors, it is complex and can often seem confusing, but it remains the best method we have today for protecting the rights of the inventor or author to their creations.

Patent assertion
The importance of securing the rights of a business to its IP can be seen in the plethora of law suits active around the globe. Whether it is Apple and Motorola in Germany or Oracle and Google in the USA, ‘patent assertion’ is the order of the day. And the value of these patents is on the increase, too. Microsoft is reported to be planning to buy patents from AOL for more than $1 billion. There are even companies in existence today whose sole function is to hoover up the patents of other businesses with a view to selling them on for profit.

The wind-up radio
It is not just technology giants who are concerned about the security of their IP. For a small business looking to create new solutions to old problems, ‘the idea’ itself is often the starting point. 

I recently attended a talk by Trevor Baylis, the inventor of the wind-up radio and a strong advocate for teaching Intellectual Property within the national curriculum in schools. When he heard that the spread of AIDS in Africa could be combated by the improved education of people if only they had access to radios which, because of the lack of electricity and the cost of batteries, were not available, he decided to solve the problem. 

He had the idea of producing a wind-up radio that would be cheap enough for widespread use in Africa. Trevor is an engineer and used his domain knowledge to build prototypes and prove his design. The next thing he did was to patent his idea. In his talk, he said that the greatest day of his life was meeting Nelson Mandela in South Africa, part of the recognition that he got from helping to save countless lives. All possible because he secured the rights to his invention. 

The importance of the investor
However, Trevor also told of the obstacles he faced in getting recognition for his idea and the problems of making it happen. It wasn’t until some eagle-eyed investors recognised the opportunity and established the means to generate a commercial model that the wind-up radio was successful.

It often takes the genius of the original idea together with the money of savvy investors to bring innovations to market. But those investors in the wind-up radio were only interested in committing their money when they knew that the idea was protected. Not only did the patent give protection to Trevor Baylis, it also gave protection to the investors.

A solid foundation for small business success
Small businesses can learn from this example. When the product of a new company is ‘new ideas based’ and has clear market potential, it is essential that the foundations of that business are built upon the rock of Intellectual Property protection. 

Without it, it will be very difficult for that business to gain the support of the investment community. With it, alongside strong management and solid profit forecasts, the investor can take heart that the opportunity has a much higher chance of exploiting competitive advantage. 

And, as we are seeing in the recent spate of patent trading, there may be hidden value in the patent itself.