Knowing what to do to keep customers happy is only half the battle. Customer experience leaders need to know what not to do. These are those bad decisions – and how to avoid them.
Every business can learn from mistakes, but making too many bad decisions can damage customer relationships beyond repair.
While no leader makes decisions that will intentionally upset customers or make it harder for front-line customer care professionals to deliver a great experience, it happens. Why? Actions that seem right for the organization, time or conditions aren’t necessarily good for customers.
Making customer-centric decisions
Leaders often let the bottom line, board of directors, shareholders and current economic conditions guide their decisions instead of the customer, says sales and marketing expert Pam Lontos.
Customer-centric decision-making is the cornerstone of strong businesses. Researchers have found time and again that customer-centric organizations are more profitable than those that focus on financial gauges such as profitability, market share and sales revenue.
What’s more, a Booz & Company study found that companies that moved to a customer-centric business model cut product development costs and boosted customer retention.
Customers come first, profits follow
Bottom line: By putting the customer first, the financials almost always fall into place.
Here are seven of the most damaging decisions and how they take away from the customer experience. Plus, we’ve included examples of how successful customer experience leaders and businesses have avoided making these mistakes.
1. Judging customers
Business leaders make this mistake in many forms. For instance, they might paint the picture of an ideal customer, which is initially a good practice. The problem ends up being they fail to go back to the drawing board as the customers, the industry, the company and products evolve. Another potential mistake: Failing to gather customer feedback before making decisions that affect customers, and instead taking action based on what they think customers want and like.
“Rather than prejudge and dismiss what could be your next best customers, suspend judgment and take the time to get to know each prospect and client,” suggests Lontos.
To avoid this mistake, Rick Johnston, VP of constituent relations at the American Diabetes Association, created short quarterly surveys and some follow-up post-call surveys to maintain a clear picture of what customers expected. Based on the feedback received, he and his staff created customer profiles — determining which customer “type” needed the most hand-holding, technical help or speedy, factual service. They regularly update the profiles based on ongoing feedback so every contact is as personal as possible.
2. Under-staffing
Many business leaders look at the balance sheet, and if it isn’t showing enough profit, they decide they must do more with less. The result: Customers get less attention — or worse, none at all.
Follow-ups to inquiries take too long because the over-stretched front-line employees need to put the most urgent fire out, leaving little time to respond back to a customer or potential client who had a basic question (which could’ve led to a big sale or continued loyalty).
To avoid this mistake, especially if you’re truly pressed to do what you can with what you have, give customers more outlets to ask questions — and post when you’ll be able to respond. Robert Coffman, customer service manager at Emergency Medicine Associates, and his team found that customers didn’t mind waiting a little while to get an answer — but they hated having to wait to ask a question. When they offered more contact points — based on customer feedback — and adhered to their published response times, customers were pleased.
3. Focusing on the next best thing
Companies and their leaders must always be looking forward, but never at the expense of appreciating where they are now and who’s gotten them there: loyal customers. Many sales and service leaders push and incentivize the next sale without rewarding front-line personnel for customer retention efforts.
Loyal customers come to expect to feel appreciated when they deal with a company where they invest their money. One business owner who Lontos knows learned that the hard way.
“She asked the customer (who hadn’t been buying) what happened, and the customer explained that in the past, the business owner had always taken her out to lunch once per quarter, and they hadn’t for nearly six months. As a result, the customer felt that she no longer was important.”
Following that revelation, lunch was planned, and the relationship was saved.
To avoid this mistake many businesses reward employees for their efforts to maintain customer loyalty. For instance, Eric Galvin, a VP of Operations at Cigna, realigned rewards and bonuses to encourage front-line staff to stay customer-centric in all they did. In addition to rewarding them for meeting goals, Cigna structured bonuses based on customer feedback. If customers said they were happy with individual reps, the reps saw it in their paychecks.
4. Working in silos
Marketing finds them. Sales sells them. Service keeps them. It’s a model many companies follow — and it can hurt customer experiences because it’s usually not a fluid model. Every department works so hard to do its part in the process — and hopefully be rewarded for those efforts — that they focus solely on its outcome, not on how the overall experience affects customer satisfaction and loyalty.
Customers feel the disconnect — and dislike it.
To avoid this mistake, and overcome issues that similar circumstances had caused at KaVo America, Customer Service Manager Joan Swanson took relatively simple steps to keep information flowing throughout key departments. For one, she put herself on Sales and Marketing’s mailing lists — print and email — so she and her staff saw promotions and specials as soon as customers did. She sat in on development meetings and daily huddles to stay on top of product issues, ideas and troubleshooting.
5. Creating too many rules
Policies and processes to keep customers and employees safe and out of legal or physical danger are about the only rules that should never be bent. Unfortunately, many business leaders create policies and rules to protect themselves from the 1% of bad customers. That almost always leads to upsetting the other 99% of good customers at one time or another.
From rigid contracts to a laundry list of expectations on exact motions employees should go through to complete an “ideal” transaction, companies often adopt too many rules that end up hindering what could be great customer experiences.
To avoid this mistake try something unconventional like Shan Coughlin, former research manager and strategic planning specialist at Burroughs & Chapin, did. She cut the list of service standards, and it helped improve the customer experience. Her team helped develop just four standards and topped them off with “Use good judgment.” That said it all: It allowed front-line employees to work independently in customers’ best interests.
6. Insisting on control
Some leaders fear that a breakdown in customer relationships so much that they want to maintain control over all aspects of the customer experience — a task no one is capable of doing alone. That’s why they insist on “management approval” for anything outside of an ordinary request before allowing an issue to be resolved. Those delays — and apparent lack of trust for front-line employees and customers — erodes customer relationships.
“Give your staff the training and tools to handle whatever situation arises so they can make the customer happy right away,” says Lontos.
To avoid this mistake Jennifer McCreary, customer service supervisor at Glasfloss Industries, LP, asked each member of her staff to pick a favorite part of their job and asked them to become the local expert on it, allowing them to take the lead on all issues related to that aspect of their job. Some people created best practices and others gathered more information from in-house experts so they could be a go-to source of information for colleagues and make fast decisions in those areas for customers.
7. Standing still
Change can be scary and unpredictable, especially for customers and employees. So some leaders make the mistake of avoiding change so they don’t rock the boat with employees and customers. After all, they might figure: If it ain’t broke, why fix it?
The problem is, customers and their needs do change, and if companies don’t stay a step ahead, they’ll eventually lose customers.
To avoid this mistake make changes — and prepare customers for them so they feel more like a much-needed improvement than a menacing change.
Lori Schmidt, business analyst at Pitney Bowes, and her team have to roll out changes to customers almost every year. They do it successfully time after time by:
- Emailing customers updates on the changes weeks in advance
- Giving clear instructions on any actions customers have to take
- Adding an alert to their inbound phone message reminding customers of changes
- Adding staff and beefing up training for the short period after changes are made, and
- Including more information in the staff database to answer the increased number of customer questions.
