Dominic Monkhouse Peer1 Internet World 2009 # I W E X P O

introduction

• What do you do for a living?– We find stuff we don't like and we change it

• culture/rituals/beliefs/tribes– Volunteers, cant force– Connections– Yearning– True believers

2 stories

Denial of service

I am a heratic

• I am here to commit heresy

HAPPY STAFF

HAPPY CUSTOME

RS

MORE PROFIT

PLANNING YOUR ROUTE TO EXCELLENCE

Start with the staff – IT’S PROVEN:

FINANCIAL MODEL

Practice What You Preach

PRACTICE WHAT YOU PREACH

• I am highly satisfied with my job• I get a sense of accomplishment from my work• The work I’m given is challenging, not repetitive• I am committed to this firm as a career

opportunity

• Move the scores from 4 to 5 on a 6 point scale for a 42% improvement in financial performance.

Practice What You Preach

ESTIMATED LIFETIME VALUE - REVENUEFACT: A great customer is worth 102x an unhappy one.

ESTIMATED LIFETIME VALUE - MARGIN

Myths that get in the way

• Recovery is expensive• Cross-selling• Warm body• CEO doesn't get it

• But I don't care!

The CEO gap

• CEOs who believe their firm is above average on service – 75%

• Customer feedback – somewhat or extremely dissatisfied with most recent experience – 59%

» Accenture 2007

Issues

• Keep handling the same issues• Self service doesn't exist or is rubbish• Service is reactive• Hard to contact the right person

– Sorry I cant transfer you• Customer service dept.....• Company CANT listen• Wrong metrics• Wrong staff

Solutions

• Eliminate dumb contacts• Closed loop active listening

– Cut the crap meetings– Owners of solutions

• Make yourselves easy to do business with• Self service tools that work• Change your metrics• Be proactive• Preventative support• First Call SupportTM

Stop doing dumb stuff

• Why do customers contact you?– Phones calls– Emails– Support tickets

• What happens to complaints?• How many invoice problems?• Credit notes for what?• Low rated support tickets?

Major Supermarket Chain

Heatmap Interpretation:

1. Promote success? For example, create prominent banner for ‘Go Shop’ or focus on less popular items?

2. What are users’ missing? Can navigation be restructured?

Self service example

Before• 1000 “tickets” per day• 12 staff• Monthly purge to stay “on-top”

After• 300 tickets per day• 4 staff

Costs• setup plus• £600 down to £200 per month

Tools

Churn

First direct

4% annual customer churn

Peer1

7% annual employee churn

Recovery

• TNT found increased loyalty after recovery• Done right it builds trust• Don't just write you need to call

Measure your service

Not annual survey!• NPS monthly

Customer touch points• By employee• By touch point• Every time in real time

Feedback, feedback, feedback

Maximising The Value of Customer Feedback

2. COMMUNICATING TO OUR EMPLOYEES

• All can access survey results online (in real time)

• E-mail alerts instantly sent to Operations Director if customer rates itlab less than 7/10

1. MEASUREMENT

• NPS issued monthly to 1/3rd customer base

• Insight Survey issued within 30 days of becoming a customer

3. ACTION PLANNING

• Survey results (NPS, suggestions for improvement etc.) are reviewed at team meetings

• Directors ring all text answers

4. ACTION DEPLOYMENT

• Customers that aren’t delighted are followed up with a health check

• Appropriate customer suggestions are implemented

5. COMMUNICATING TO OUR CUSTOMERS

• Customers receive feedback on the changes we have implemented as a result of their suggestions

Net Promoter Score

Net Promoter score• Key metric to measure customer service• Would you recommend us to a friend or colleague?• Your dedicated team is rewarded only on your satisfaction

Bad profits and Good profits• Bad profits are profits earned at the customer’s expense, in other

words, profits earned from customers which then become detractors

• Good profits are earned from creating customer value, which in turn creates customers who are promoters

Net Promoter Score

Net Promoter Scoring

• Answers between 0 to 10– 0 – 6 = Detractors– 7 – 8 = Passive– 9 – 10 = Promoters

• Score Calculation:– Promoters – Detractors/Total Responses = % Score

• Management target - How do we turn passives and detractors into Promoters??

Where does growth come from?

Easy to do business with

People Vision

Recruit great people and allow them to do what they do best every day.

Percentage of Buyers Getting the Same Make Again

Source: J.D. Power Associates

40%

0%

10%

20%

30%

40%

50%

Good Car/Good Dealer

16%

Good Car/Bad Dealer

24%

Bad Car/Good Dealer

Employee Satisfaction Drives Loyalty

• MEANS• Low employee turnover is directly linked to high

customer satisfaction. Dissatisfied employees are 300% more likely to leave.

• SPECIFIC ACTIONS• Implement weekly yay/meh/boo (YMB) survey –

act decisively on the results.• Management to be careful what is promised and

then ALWAYS deliver on promises to staff.

How are you today?

Indicators

• 20% of new employees are internal referrals

• Service revenue goals – 50% growth per year

• Net promoter scores – get in to 80% range• By customer segment

• By product

• By support channel

• Net revenue growth per product per month - 3%

• 50% of new customers by word of mouth

Case study: itlab

“We seek criticism”

THE CHALLENGES WE FACED“It’s not how good you are it’s how good you want to be…”

• Poor communication with clients – always reactive, never proactive.

• Poor communication internally – impacting client service.

• Lack of commercial confidence – Fear of discriminating about which customers to serve.

• Crisis of bureaucracy – competing systems, conflicting goals.

• Poorly integrated acquisitions – different product sets, cultures and teams.

• Misaligned products – didn’t reward adding value to the client.

THE ACTIONS WE TOOK

• Clearly define excellence – Service Obsession™ & Core

Values• Create strong culture – Flags, 10 Things, Balls of Glory,

Charity & Social Committees, Friday Nights & Fun Zone.• Benchmark excellence – Net Promoter & closed case• Redefine Products – 2.0, Direct, ITMS• IT Manager – trusted advice from a techie NOT a salesman.• Specialist Practices – acquisitions role clearly defined• Netsuite – replace all internal systems for data unity, portal,

single invoice, surveys, instant feedback loops

THE IMPACT ON THE ORGANISATION

• Service gross margin – From 50% to 67%• Profitability – From breakeven to 7% and rising (35K

pm)• SLA – 10 minute critical 97% last quarter average

2.34min• Responsiveness – average call answer is 4 seconds• 5 out of 5s! – 75% of rated tickets marked 5 –

Serviced Obsessed (40% response rate)• Financial Times Top 50 Places to Work (companies of

any size)• NPS - -2 to +14 and then +55• The Results you Can’t Measure – go and visit for

Richard’s Mum’s Cake!

The smart cheater strategy