Charteris Business Blog

E-Commerce Customer Experience 3: Search Tuning - People and Process

2010-02-02T14:00:00.013+00:00

Post series written by Matthew Lynch (Senior Consultant at Charteris specialising in eCommerce). Before joining Charteris Matthew worked for IBM on various eCommerce enablement projects across multiple industries from the late 1990's through to the present day.
This series of blogs is about how product managers in an eCommerce business can influence and optimise the customer search experience on their website by tuning the on-site search engine.

Tuning search is like servicing your car; omit it and you risk losing value and breaking down. Get the habit and the right people
In the last blog entry, we covered what search tuning was and why it was important to do it in order to optimise the customer search experience on eCommerce websites. In this blog entry, we will explore the process that businesses should consider implementing in order to keep up-to-date with their search tuning.

Servicing your car is a chore, but most of us do it. Why? For peace of mind; perhaps to ensure you optimise its resale value, to prevent the inconvenience of breakdowns and to keep it safe. The same goes for search tuning. If you don’t tune your search regularly, the value of the search experience (and hence your eCommerce site) will reduce or may even breakdown (if customers can’t find product). Also, like skipping maintenance on your car, skipping maintenance on search means that you won’t know if anything is wrong and you won’t be able to predict when the reduction in performance or breakdowns might occur. Search tuning doesn’t need to be an onerous process either, as long as it’s done regularly, it shouldn’t need to take long.

Search tuning isn’t everone's forte.

Given the apparent technical nature of the task, you might be inclined to give it to your help desk, your web designers or your admin staff. Whilst their skillsets might fulfil two of the criteria required of the search tuning process : ‘attention to detail’ and ‘discipline’, they may not be able to adequately fulfil the key requirements of ‘product knowledge’ and ‘good language skills’.

Attention to detail is a desirable trait because, whatever tuning you do, if you do it wrong, it can be worse than not doing it at all. For example, if you mis-spell a synonym (e.g. you enter bart->kart instead of cart->kart, not only have you not corrected the customer’s problem that the synonym was supposed to resolve, but you have potentially created a new problem for the customer as well (people searching for Mario Kart won’t be satisfied AND those searching for Bart Simpson will be shown irrelevant products relating to Mario Kart as well).

Like attention to detail, discipline is important to ensure that search tuning is done regularly enough to catch problems before too many customers have experienced them and to ensure that any changes to search tuning are tested to make sure that they have the desired effect. The regularity of tuning will depend on the size and regularity of changes to your product / content catalogue and also the number of customers hitting your website. Once under way, you’ll get a feeling for how often you should be search tuning from the number and frequency of problems identified in the search reports after the initial set of search tuning sessions. You will have a bunch of things to fix when you start, then the number should settle down. Omitting to test changes means that you don’t know if you’ve actually made the experience any better and, just as importantly, you don’t know if you’ve inadvertently made it any worse. Testing is straightforward: check the search results on your website before making a change and compare it after tuning.

With the general skills sets out of the way, consider the two key specific skills your search tuning staff ought to have...Product knowledge is a must have. Without it, you won’t be able to pre-empt some problems let alone deal with ones that are identified in the analytics from your search tool.
For example, if you’re not into video games, it unlikely you would know that people using ‘wow’ or ‘cod’ as a search terms on the games retailer’s website were searching for the game titles ‘World of Warfare’ and ‘Call of Duty’.

Choosing someone to perform search tuning who has good language skills is probably a no-brainer, but should be kept in mind all the same. Knowing the difference between a noun, verb, adverb, adjective etc is useful as is the ability to spell and recognise the likely intended meaning behind search phrases that customers are using. If your website is represented in more than one language, if you can, get native speakers doing the search tuning, because they will have a much better feel for how their language is currently being used.

Prevent and react to search issues
Depending on the nature of searchable content your product or content teams are adding to the website, you may be able to prevent some search problems. There’s no harm, for example, in adding synonyms for words that are in the dictionary or synonyms between unique product acronyms and the full product title. With practice and analysis of your product set, you may find others as well.

That said, beware of doing search tuning for the sake of it. As mentioned before, it can be quite easy to make things worse than they were by being overzealous tuning search before you have seen any problems in your search reports.

Business-as-usual tuning

You should analyse your search analytics frequently for search terms that return zero results and search terms that return large numbers of results. Analysis of the zero results report should reveal acronyms, misspellings and typos that you should account for in your synonym database. It may also reveal searches for products that you don’t have for sale.

Search terms that result in too many results could be an indication of the term containing a word that occurs so frequently, it should be ignored or an indication that you should instruct your search engine to ensure an exact match ‘enforcing a phrase match’, thereby excluding partial matches from the list of results.

Consider tuning as new products are added to your catalogue. You may prevent problems occurring, for example, by adding known acronyms as synonyms. Again, beware of being over-zealous because adding unnecessary synonyms to your thesaurus just means there’s more work for the search engine, more to clean up later and more potential for incorrect entries. Let the analytics of real customer behaviour drive your main tuning activities.

As mentioned before, testing needs to be an integral part of the tuning process so that you know the effect of changes you make.

Search tuning housekeeping

Finally, bear in mind that, just because a synonym or enforced phrase worked at one time, doesn’t mean it will stay useful forever. This year you may setup a synonym of touch -> “ipod touch” because the “ipod touch” is popular right now and you know that there’s a lot of searches just using the word “touch”. However, at some point in the future the search term “touch” could be used in a completely different context by customers, hence the need for periodic reviews of your search tuning.

This concludes this set of blogs on search tuning.
---------------------------------------------------
Contact – matthew.lynch@charteris.com

E-Commerce Customer Experience 2: Search Tuning - Techniques

2010-01-04T14:00:00.004+00:00

Post series written by Matthew Lynch (Senior Consultant at Charteris specialising in eCommerce). Before joining Charteris Matthew worked for IBM on various eCommerce enablement projects across multiple industries from the late 1990’s through to the present day.

This series of blogs is about how product managers in an eCommerce business can influence and optimise the customer search experience on their website by tuning the on-site search engine.

The search engine doesn’t know what it doesn’t know

You may already have a facility that helps you improve on-site search for your customers.
It should have been setup with an initial “dictionary” to make sure that it works well at go live.
But, after go-live, how can you make sure it continues to work for you? After all, you’ve got new products coming on-line all the time and you want to ensure your customers can find them.

Search engines only know what they’re told

Without manual intervention the search engine is only as good as the in-built auto-correction function (to deal with typos, mis-spellings), the default dictionary, any content that it knows about and ‘domain-specific’ dictionaries which, if vendor supplied, are likely to be quite generic.

Search tools are not necessarily aware of common mis-spellings, typo’s, domain-specific acronyms / phrases, what customers will actually search for in real life or other common language in the industry sector. They will also not be aware of specific key phrases or made-up product names that exist in the product catalogue that have specific relevance.

Also, language use evolves over time, sometimes quite quickly (often as a result of creative marketing or journalistic minds), so there’s no way that a search engine is going to keep up-to-date without human intervention.

Regular search tuning improves the bottom line

Search tuning enhances the relevancy of results, reduces the number of zero results found and helps identify application configuration and design changes that may be required. The process of search tuning is also another way of keeping you in touch with customer trends. All of these things help to improve the customer experience ultimately leading to improved conversion, basket size and customer loyalty.

The business, not IT is best placed to perform search tuning

If your business is not tuning its on-site search engine, then it may not know how many customers are having trouble searching for your products on your site. Many people assume that the search engine belongs to and is maintained by IT. You might think that your SEO strategy and keyword-promotions ensure that customers can find your products using Google, Yahoo etc, but if you’ve got any direct-loaders (people who go straight to your site and then use your site’s search facility) then they need their searches to be looked after by the business, the guys who understand the products and how they are marketed and sold to the customer.

Consider who owns the customer relationship. The business doesn’t get IT guys to write the product titles, descriptions, retail reviews or marketing copy, so why should the business rely on IT, when search engines deal with words that customers are looking for in the very text that has been created by the business?

Use analytics to identify search tuning needs

In eCommerce, many people will have come across a “top-search-terms” report from the web-analytics tool. This, generated regularly, can form the basis for search tuning. For best use, it needs to report the popularity of search terms together with the average number of results returned and needs to show search terms with zero results. In addition, it is useful to have a report showing you search terms that have been autocorrected.

Tuning affects which words and phrases the search engine considers or ignores

Search tuning involves telling the search engine how to handle words and phrases that it may not ‘understand’ or that it may assign more or less relevance to than desired by the business.

Stop words
In most circumstances, there’s no point in a search engine searching for words that are so common that they appear in large numbers of product titles or descriptions. It results in too many, often irrelevant, results for the customer and wastes the search engine’s resources in matching them. Typically these words include ‘a’, ‘an’, ‘of’, ‘the’ ‘i’, ‘is’ etc but the business really ought to work out for itself which words are so common that the search engine should ignore them. This may include some words that are core to the product set being sold e.g. a entertainment retailer might get the search engine to ignore DVD, CD etc. Be wary of adopting the standard set provided by the search tool vendor. For example, a ‘stop word list’ provided by a search tool vendor may include the word ‘that’, but for a CD retailer, this would not be an appropriate stop word if it meant that it made searches for CDs by ‘Take That’ of lower relevance than results that don’t contain the word ‘that’. Try it, you’ll find there’s a band called “Take”.

Synonyms
It is estimated that 20-30% of all search terms used on the internet contain a mis-spelling or a typo. If that is the case and your search engine doesn’t manage to autocorrect them or the typo is on a made-up word such as a brand or product name, then your customers will get zero results, the dreaded dead-end.

The solution; find out the terms that customers are using that return zero or few results and setup a synonym to the term that does match products.

Some examples where you would use synonyms include :
- Numbers – equate 2 with ii and two
- Acronyms – to equate product-acronyms with the full product title
e.g. LOTR -> Lord of the Rings
- Common mis-spellings e.g. cart <-> kart
- Made-up product titles with spaces taken out e.g. (wii) motion plus = motionplus
- UK / US spellings (if not auto-corrected) e.g. color <-> colour, metre <-> meter,

Enforced or Automatic Phrasing
If your customers are getting too many results for certain search phrases, of which you find that many are irrelevant, then you should instruct your search engine to only consider results where there is an exact match to the phrase (words and their order).

e.g. "32gb ipod touch" - assuming you didn’t want the search engine to return 4/8/16gb ipods or ipod nanos in the results set)

Stemming
Good search engines take verbs, adjectives and adverbs that are used in a search term and condense them to their ‘root’ form or ‘stem’ (e.g. running -> run, richer -> rich, strongly -> strong) before comparing them to the content to be searched which has also been ‘stemmed’. Search engines often come with stemming built-in but if problems are identified using the search analytics, then additional stemming ‘synonyms’ or rules will need to be added. The process of getting to a word stem is language dependent and may require the skills of an experienced linguist if adjustments need to be made.

Search keyword / phrase Redirects
Sometimes it is desirable to redirect a customer to a hub or landing page that makes the best representation of a product or product set that the customer is looking for. This gives the customer a better experience than the presentation of a product list (which may well not show the full range of potential product type matches on page 1).
It is a common occurrence for customers to search for types of products e.g. Romance films, so a redirect for such types of search would be a good idea.

It is good practice to monitor for new occurrences of such searches and setup a search term redirect for the phrases used. Good search engines provide a facility for recording such redirect phrases with the desired destination such that the search engine provides redirect URL destinations to the eCommerce website when such phrases are matched.

In my next post we will look at what’s desirable to look for in people who will perform search tuning and how the tuning exercise can be organised
---------------------------------------------------
Contact – matthew.lynch@charteris.com

E-Commerce Customer Experience 1: Search Relevance - Ranking

2009-12-02T14:00:00.003+00:00

Post series written by Matthew Lynch (Senior Consultant at Charteris specialising in eCommerce). Before joining Charteris Matthew worked for IBM on various eCommerce enablement projects across multiple industries from the late 1990’s through to the present day.

This series of blogs is about how product managers in an eCommerce business can influence and optimise the customer search experience on their website by tuning the on-site search engine.

Get your search engine to understand your customers’ language
Is your site conversion in need of improvement? Do too many of your customers drop out of the funnel early on? Do they consistently find what they’re searching for on the first page or two of search results? Do you have feedback from customers saying they find it difficult to find what they want on your website?

If the answer to any of the above is yes, you may need to make it easier for your customers to find product. In other words, you may need to actively tune your search engine to suit the way your customers search for product.

Search results - What’s relevant?
Search is search is search isn’t it? That’s what some people think; “surely, if we implement the ‘best’ internet search application, that’ll solve the problems we have with our poor search relevance won’t it?”On-site search for an eCommerce website is not an exact science and is certainly not best served by a generic internet search tool. The main reason for this is that what a generic search tool considers ‘relevant’ will almost certainly not be close to what you or your customers would consider relevant search results for your eCommerce website.

For example, what would product managers think if the products appearing at the top of your search results page were just those with the most matches to the search keywords, sorted by price alone? It is unlikely that this idea of ‘relevance’ would meet their or your customers’ sophisticated expectations.

The answer lies in defining what ‘relevance’ means for your customers and getting your search engine to return results that get as close to that definition of relevance as possible. Relevance may well vary in your business according to the type of customer or type product / service that is being sold. For example, relevance could mean ‘popular’ or ‘most recently released’, ‘capable of being delivered soonest’, ‘most highly rated’, ‘highest converting’ or any number of other things depending on the nature of your business, product or customer base.

Taking a simplistic view to illustrate the point, let’s consider that there may be three types of visitors to a retail website : a) customers who know what they want and have a specific item in mind b) customers who have an idea what they want but want to compare products before making a choice and c) customers who have no real idea and are just browsing.

Relevance for customer type (a) is likely to be very focussed on as close a match as possible to their search term in the product title. Relevance for customer types (b) is likely to be product or product content whose title and category have the best match to words in the search term entered. Relevance for customer types (c) is likely to be product or content whose categorisations have the best match to words in the search term entered.

For a retailer of DVD’s, therefore, customer (a) might enter a search term such as ‘Temple of Doom’, customer (b) might enter ‘Indiana Jones’ and customer (c) might enter ‘Adventure movie’.
If your search engine hasn’t been configured with appropriate relevance ranking strategies, the results may not be what each type of customer expects. Taking the simplest model of ‘relevance’ where purely the number of matching search words determine the relevance, you could end up with something like this :“Temple of Doom” ->
1. The Little Princess: Shirley Temple DVD - the word Temple appears lots of times in the product description
2. Paul Temple (DVD)3. Doom the Movie – Doom appears lots of times in the product record
4. Indiana Jones : The Temple of Doom (ought to be at the top of the list)

“Indiana Jones” ->
1. The World’s Fastest Indian - title + lots of matches to Jones in the cast list
2. History of Indiana Basketball -lots of references to Indiana !
3. Indiana Jones : Raiders of the Lost Ark (1st film, so appears 1st)
4. Indiana Jones : Temple of Doom (2nd film, so appears next)
5. Indiana Jones : Last Crusade (3rd film, so appears next)

“Action Adventure DVD” ->
1. The Adventure of the Action Hunters
2. Lara Croft Tomb Raider: The Action Adventure
3. Operation Dalmatian: The Big AdventureHere, matches are on the product record in preference to the categorisation.

As you may see from the above examples, a search relevance ranking strategy that assigns different weight to product category and title in the product record over other ‘less relevant’ parts of the product record, ought to improve the relevance of results for the customer. In addition, a commercial weighting could improve the weighting for the business. For example, it could boost the relevance ranking of the more popular 'coming soon' or 'recently released' film releases e.g. putting the 2008 film Indiana Jones and the Kingdom of the Crystal Skull at the top of the list). Bounce rates should be reduced by making sure that the latest releases are always shown.

As well as weighting the elements of product records, tunable search engines allow you to determine the priority of search ranking schemes (algorithms) to affect the results. For example, the search engine might have a method A that scores results based on the number of search keyword matches per field and scheme B that scores results by the total number of matches across the whole product record. In many circumstances, a retailer would want the scores allocated by scheme A to have more weight that scores allocated by scheme B.

A methodical approach to improving your search relevance is recommended. This involves the following high level steps :

1. Define what relevance means for which customer types and product types
2. Measure your current site search results against the desired outcomes defined in step 1
3. Prototype and test different relevance ranking strategies in your search tool
4. Periodically measure and review your relevance ranking strategy to maintain the optimum outcome for the customer and your business

In the next blog entry, we will explore what you can do to tune a search engine to handle problems with specific words.

-------------------------------------------------------------------------------------------------------------------------------------------------------------

Contact - matthew.lynch@charteris.com

Customer Experience Pt 9 - Appraisal

2009-07-28T10:34:00.002+01:00

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

Nine months on and we have the final part in this series which, in a similar way to the last part on reward and recognition, is all about long term sustainability. I have found opinions amongst several of my clients to be extremely divided when it comes to individual annual appraisal. Those in favour see it as an invaluable management tool while those against feel appraisals can be divisive or simply a waste of time. The latter view is commonly held within those organisations that don’t have a ‘pay for performance’ policy, but even in these organisations I still believe appraisals can play an important part in developing performance. Team appraisals are another approach, but that is where I feel they can be a waste of time as a team approach negates the key benefits. Let me explain why.

Appraisals should be all about making individuals responsible and accountable for their contribution to the organisation’s aims. In that way they should be just as much an opportunity for thanks and reward as they are for constructive criticism and personal development. However, their effectiveness is determined by two key factors: what they report on and the way they are positioned within the organisation. I can only imagine those who are against annual appraisal have been subjected to a poorly executed process in the past either because the appraisal framework was flawed of the manager delivering the appraisal was flawed in their approach. Sadly both occurrences are far too common, but that shouldn’t be a reason to abandon the concept.

Content is Key

Firstly the content should be a combination of measurable performance, sometimes expressed as targets depending on the organisation and, to support the desired culture and customer experience, a set of commonly understood behaviours derived from the statement created earlier in this series. The most important aspect however is that the existence of the appraisal process and the aspects of performance it reports on should be totally transparent to the employee from the day they join. Keeping the form simple, clear and short is also a must otherwise the appraisal process becomes onerous for those delivering it and lacks real meaning for those being appraised. Some organisations use a performance matrix for their appraisals in an attempt to reduce or eliminate subjectivity. While this may be a worthy aim (or a defence mechanism from a Personnel Director who lacks confidence in their line mangers’ ability to be fair and balanced), I have yet to see a matrix that doesn’t de-personalise the reporting to the point that its benefits are lost.

Delivery

That takes me to my second point which is about the delivery. The appraisal should simply be a formal record of the year’s performance. If the leadership in the organisation is competent there should be nothing in the appraisal discussion that comes as a surprise to the appraiser or appraisee. Sadly that’s where the process most commonly breaks down, when the manager hasn’t developed a leadership relationship with their team with the consequence that the appraisal is the first time good or bad performance is discussed, and that’s the best case scenario. What commonly happens is the manager who hasn’t developed a relationship with their team over the year then feels unable to comment on areas for development at the appraisal, so chooses the safe option and writes a report that is neither encouraging nor developmental. What I am really saying here is that the annual appraisal should be a formal record of the year’s leadership relationship and anything less should serve to demonstrate how that relationship should develop on both sides. And it must be a genuine two way discussion. This is not something handed down from on high, but an honest two way conversation about the highs and sometimes the lows of the last year with objectives set for improvement where necessary - and these should NEVER be a surprise.

When handled well, appraisals formally record the conversations that should have been going on every day for the last year. They also serve to strengthen the leadership approach described in the earlier article as a manger who hasn’t adopted that approach will find themselves very exposed at appraisal time. Of course they also provide the opportunity to record unacceptable performance and can document the beginning of a disciplinary and grievance procedure which is so important if you are to comply with employment legislation. However, I would stress again that even this should not come as a surprise to the individual being appraised. For those making a sound contribution appraisals document the opportunity for reward, further development and succession planning for senior roles which is so important, especially in larger organisations.

In Conclusion

So there we have it, seven easy steps to sustaining a great customer experience and an engaged and motivated workforce. I hope you have found these articles useful and for those of you without the time or inclination to read them all, to conclude with, here is your simple executive summary:

Define – what sort of organisation you want to be both for your customers and employees

Communicate – communicate frequently and loudly the aims of the organisation and the culture you want to foster. Evidence the communication with sharing of best practice within the organisation

Recruit – ensure the recruitment process identifies those with the right attitude and personality to support the aims of the organisation

Measure – you can’t measure the behaviours easily, so consider the desired outcomes of the behaviours and measure those

Lead, don’t manage – provide inspirational, highly visible leadership that demonstrates the desired culture and behaviour on a daily basis

Reward and recognise – take every opportunity to highlight the sort of behaviour and subsequent outcomes the organisation aspires to consistently deliver

Appraise – use annual appraisals to identify future leaders, reward those who support the organisation and start the process of removing those who don’t

Customer Experience Pt 8 - Reward and Recognition

2009-07-21T09:55:00.002+01:00

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

So, now we have a business that knows what it wants to be both for its customers and employees, has communicated those aims to its existing staff and embraced those aims in its recruitment procedures, is frequently measuring its performance against those aims internally and externally and has a leadership structure aligned to delivering improvement – we’re almost there! We’re now on to consistency and sustainability and a key element of that is reward and recognition. It’s an area that is commonly overlooked and possibly seen as unnecessary or frivolous. Nevertheless a clear reward and recognition strategy, frequently used and consistently applied can have a disproportionate positive effect on the culture of an organisation.

Appropriateness

What’s appropriate depends, of course, on the culture of the organisation and what might be seen as childish and possibly condescending in one organisation could be seen as motivating and fun in another. If an organisation has followed all the stages in previous articles, by now they should have a very strong sense of what is appropriate for their business and what will be engaging and motivating for their employees. This doesn’t mean having a complex structure or spending huge amounts of money either, but it does have to have an explicit and direct link to the sort of behaviour the organisation is trying to engender. Many years ago Ken Blanchard wrote ‘The One Minute Manager’ and for those of you who have read this now legendary book you may remember ‘catching people doing something right’ as a prerequisite of leadership. The challenge for many managers today is that they are just too busy to find the time to ‘catch people doings things right’. Well, if you have implemented the leadership changes from the last article you will have found some time to spend in each day with the people you lead, and if you are doing that you have the foundation for a reward and recognition process in place already! In other words, frequent verbal recognition for something done well can have an incredible effect within an organisation that hasn’t been used to it in the past. Often in these organisations managers have usually spoken to their teams when something has gone wrong or at their annual appraisals so recognition for very small routine things done well can come as something of a surprise. However, stick with it through the potential incredulity and the team will start to respond and change their collective culture in ways you would have never imagined possible!
Supplementary approaches might include written notes of thanks for a job well done. This might be for something that warrants a little more than verbal recognition and a handwritten note is often the best medium. In a world of instant communication and e-mail a handwritten note shows you have made a little extra effort and really care. If you want to start spending a little money at this stage you might even include a scratch card with the note for a bit of fun. Initial reactions might be “I was just doing my job”, but that’s just the point. What we are trying to engender here is a culture of excellence, self esteem and pride in a job well done.

Going Further

The next step is to implement a formal reward and recognition scheme which will require a budget. This doesn’t have to be significant and a budget based on headcount – perhaps £10 per head, per annum - can make a really big difference and is a small cost compared to training or marketing budgets which won’t necessarily produce such tangible results. That’s not to say you should mechanically spend £10 on each employee each year, but it does give a scale and set a budget requirement for the scheme. Rewards here should be made through a formal process and that process should allow for peer to peer recognition as well as those awards nominated by managers. Even on such a small budget, this would allow for occasional rewards such as a bottle of champagne, theatre tickets, flowers or even a weekend break.

The Pinnacle

The pinnacle of any recognition and reward scheme should be an annual awards ceremony. This can be a culmination of all the smaller awards given over the year or it could be a collection of categories voted for by the employees. Either way, it is important that the categories reflect the behavioural aims of the organisation such as ‘leader of the year’, ‘most support to their colleagues’, ‘most customer focussed’ etc. In a large organisation this can be funded from the residue of the £10 per head budget as it is unlikely every employee will have justified a smaller award throughout the year. I have seen prizes at these awards vary from weekends away in New York to an engraved glass trophy, but both approaches have an equally beneficial effect on the organisation. If the ceremonies are well executed the benefits go way beyond just the recipients of the awards as other employees will be quick to celebrate the recipient’s success and will have a sense of pride that someone in their team has been a winner.
If you remain doubtful, then just start by trying the first two steps which will involve some effort, but very little cost. Providing it is positioned with care within the culture of the organisation you will be amazed at the power of a simple ‘thank you’.

Customer Experience Pt 7 - Leadership

2009-06-26T21:05:00.007+01:00

Customer Experience Pt 6 – Measuring Outcomes

2009-06-17T21:05:00.006+01:00

Customer loyalty, defined as repeat business from an existing customer base and....
Customer advocacy, defined as word of mouth marketing to increase market share

Any business that requires documentation of a customer transaction should find these measures fairly easy to track and consequently it is relatively straightforward to assign financial benefits to improved customer experience. However, many businesses don’t have the ability to track individual customer transactions with the consequence that any actions to improve loyalty and advocacy have to be based more on common sense, gut instinct and often ‘a leap of faith’ rather than hard figures.

Perfect Sense

Of course it makes perfect sense that if you offer a great experience that is better than your closest competitors you will engender loyalty within your existing customer base, grow market share and you will see turnover increase. However, without each customer transaction being documented a hard-nosed Finance Director will always question whether an increase in turnover can really be attributed to an improved internal culture and customer experience or other factors. I believe that is the stumbling block for many organisations trying to find financial support to embark on such a programme and one of the reasons for the commonly held belief that service in the UK is getting worse while efficiency of process, products and services are generally getting better.

Other measures can go some way to mitigate this and the key two are:

Direct customer feedback and......
Mystery shopping

Customer feedback is essential for any business looking to improve their customer experience. This can be collected through comment cards, focus groups, exit surveys, telephone polls and perception surveys from recent customers. However the questions you ask can determine the results you obtain and need to be crafted to reflect a blend of the service that was delivered, the overall experience and the consequent perception of the business (and therefore the likelihood of future business and recommendation). At its simplest a question such as: ‘were you satisfied with your transaction today?’ will be much less revealing than: ‘how did you feel about the way we treated you today?’ The first will identify if the customer was satisfied, whereas the second will tell you how likely the customer is to return and recommend to others, which is so much more important.

Many businesses stop at customer feedback, but it’s not really enough. If you have been truly aspirational in the ambition for your customer experience you need more. Customers will, quite naturally and perhaps subconsciously, base their feedback on comparisons with your competitors. That’s not to suggest their views aren’t important, but the results inevitably will be based on their satisfaction compared with similar experiences and consequently won’t help you achieve a point of differentiation – in other word you’ll stay in the game, but no more. If you really care, that’s not good enough which is where mystery shopping comes in.

Mystery shopping offers you the opportunity to measure performance against goals that existing customers can’t even imagine, or at least it does if you customer experience ambition is high enough. Mystery shoppers should be directed at delivering a combination of objective and subjective feedback, but most importantly, if you have identified an aim for customer experience development that will be a unique point of differentiation for your business, unlike real customers, they can be directed to report on your progress against that aim.

Even More Measures

So that’s what we measure externally, but part of this programme is based on the internal culture so that must be measured too. For the Finance Directors/business case, the hard measures must be:

Staff turnover.....and
Staff absence

It’s obvious that a happier workforce is likely to be more stable and have less absence and any business can put some hard figures around both measures. However, less defined but just as important, is the staff survey which will put some detail behind the high level hard statistics. As with the customer surveys the questions you ask are key to the results and questions such as: ‘do the facilities at work meet your needs?’ and: do you think this business is well run?’ will identify the organisation’s efficiency, questions such as: ‘does your line manager value your contribution?’ and: ‘do you have a best friend at work?’ will tell you much more about the culture you are creating.

Wherever possible, both external and internal measures should link back to an individual’s performance and next time we shall explore the benefits that brings.

Customer Experience Pt 5 - Recruiting for Behaviours Aligned to Organisational Culture

2009-05-29T20:39:00.008+01:00

Last time we looked at ‘drawing a line in the sand’ with existing employees using our definition statement as a foundation. A focus on recruitment is the next, but ideally simultaneous, requirement to establishing a defined customer experience and internal culture. Depending on staff turnover this may even come before communicating with existing employees, but simultaneous actions are the ideal as you don’t want new recruits ‘tarnished’ by any negative behaviours that may exist in the business and likewise you don’t want the existing employees to be working to develop a culture that their newest colleagues don’t seem to support.
Rita Bailey formerly of Southwest Airlines in the US had a simple mantra:

Hire for attitude, fire for attitude

Making it happen

It’s something I have worked to for almost 10 years and a statement that resonates with many clients. So why don’t businesses just do it? The killer question that prevents this mantra becoming operational strategy is: What attitude? Now perhaps you might start to see why the statement that we developed earlier to define the businesses’ aims and behaviours is so much more than just a ‘mission statement’. If well articulated the statement will provide a clear definition of the attitude and therefore type of person the business is looking to attract and recruit. Of course, some roles require specific qualifications or substantial previous experience, but these attributes should only open the door to the selection process – it’s the person you are recruiting, not their qualifications or experience. If those qualifications or experience are in short supply, there may be a trade-off against the ideal attitude profile you are looking for and that can happen with exiting employees too. However, you need to be conscious that every time a compromise is made on the attitude of the individual recruited it serves to dilute the culture and consequent customer experience you are aiming to create.

Generic processes

It’s impossible to prescribe a generic recruitment process as that should be tailored to a combination of the business the organisation is in combined with the sort of people the business wants to recruit. One generic feature though is that it must never be a straightforward one to one interview. Initial screening should be done from the application form and accompanying letter, but there are variations here that can start to identify attitude over experience. One business I know asked applicants to draw their greatest achievement on the back of the application form which proved to be very revealing while being wholly relevant to their business. The next stage may be a brief one to one interview, especially if appearance is important in the role you are recruiting for, alternatively it might be a telephone interview if the role is in a call centre – I’ll never understand why all call centres don’t do this! Ideally, if there is any team working involved in the role, the next stage should be a half day group assessment. It doesn’t matter too much what you ask the candidates to do during the assessment, what you should be looking for is evidence of openness, collaboration and ability to relate to others. A hotel I once spoke with told me that they started their assessment mornings by bringing in a trolley of tea and coffee and then withdrawing from the room. The candidates that jumped up and asked who would like tea or coffee were almost invariably the ones they offered jobs to at the end of the process. That might sound like a trick, but actually it’s a very clever way of identifying which candidates have an inbuilt service ethic from those who are just there for any job. It’s certainly more revealing than a one to one interview might be where a clever candidate can make themselves appear to be exactly what the business is looking for. That deception is easy to achieve in an hour’s interview, but much harder to maintain over a half day activity based assessment. If you have a group of candidates together at one time, it can also be helpful to show them any DVDs etc that you may have produced to illustrate the culture of the business (described in the previous article) or, failing that, having a high performing employee come and talk to the group about what it’s like to work in the business and the expectations on both sides. If there aren’t a sufficient number of candidates for group assessment, an alternative approach could be to invite the candidates in to work alongside their potential future colleagues. Again, it’s very difficult to maintain a facade in that situation moreover, if the business has an established positive culture and is very brave they may even choose to let those future colleagues made the final decision about the candidate – I’ve never known of a bad decision in those circumstances. The final stage (if the role requires one) should be another one to one or panel interview with a number of competency questions based on behaviours along with the more conventional fact finding questions they may want to include. Competency interviewing is one of the most effective ways I have seen of predicting future behaviour based on past evidence and represents another technique to identify any facade a candidate may be using. For example, if a sense of fun at work is central to the desired business’ culture a question might be: ‘Describe an occasion on which you made a group of people laugh, what happened and how did you feel about it?’ That is likely to be so much more revealing than a more standardised approach which could be: ‘Do you enjoy having fun at work?’

An offer of employment

The offer letter is another opportunity to reinforce the culture and service aims of the business. It should be written as a two way contract along the lines of: We are offering you this job with the following salary and package of benefits. In return we will expect you to.... whatever the business aims for internal culture and external service are. In this way there is absolute transparency at the beginning on the relationship and should the worst happen and the new recruit prove to be unsuitable, then you have covered the first base of employment law by being absolutely clear about what is expected- even before they have signed a contract!

Follow up

But all that is still not enough! So many organisations have great recruitment processes but then fail to provide on the job support and follow up. A great mantra for this is:

100% honest, 100% kind

In other words, talk to new recruits at a very early stage about their performance in an honest direct way and be kind in giving them support to adjust if necessary. If nothing else it covers the next base of employment law should they not meet the required standard and therefore are subsequently asked to leave the business. But for me, it’s just as much about a combination of doing the right thing morally and common sense as it is jumping through legal hoops. Yet so many businesses I talk to describe a poor performing individual in terms of behaviour and then go on to say how many years they have been in post. Why? I assume a combination of the business failing to grasp the nettle at an early stage, perhaps combined with a poor or non-existent articulation of what the required standard is. By that point they will have done inestimable damage both to the businesses’ customer experience and internal culture.

Customer Experience Pt 4 - Shaping the Culture and Attitudes of Your Existing Employees

2009-02-25T15:33:00.002+00:00

Changing expectations within society as a whole – with examples
Consequent impacted changes on the way the organisation operates – with examples
Why customer experience is as important as the product/service and the processes that deliver it
The definition statement of what the organisation wants to achieve in terms of customer experience – how this will have a positive effect for both employees and customers
What this will mean for frontline employees and the leadership support required from managers
How success will be measured
Reward and recognition
Consequences of failure
Other changes they will see – these may include recruitment, appraisals, training, regular communication etc.

Another valuable approach for communication, especially in very large organisations, can be the use of media. A fifteen minute DVD demonstrating the desired internal and external customer experience behaviours can be very powerful if it is well made and doubly so if it stars employees who already demonstrate the desired behaviour and not management describing what they want it to be. Brevity is important too as the media should be short, sharp and engaging – do you remember how you felt the last time you sat through a 45 minute training video? Ideally both mediums should be used, with the presentation introducing the statement and allowing discussion and debate, then being followed at a later stage by the DVD to reinforce what has been said.

If this communication programme is successful it will have drawn a firm line in the sand so that employees and managers know what they have to do, how they will be supported, how they will be measured and the consequences of success and failure. They should be left enthused about the challenges that lie ahead and, if really successful, many will start the change as they leave the room.

Customer Experience Pt 3 - Defining Culture

2009-02-09T22:37:00.008+00:00

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

So, if you read my last two pieces and are still with me you will understand my views on how customer experience fits into the operating model of any business and how the businesses’ culture is at the heart of defining the customer experience it delivers.

That’s great if the business has been overtly aware of those impacts from day one and has taken conscious action to safeguard and nurture the culture of the business as it has grown. There are some great examples of businesses that have successfully done that. First Direct bank is one and Virgin Atlantic is another. Both are known for delivering a distinct and defined customer experience and they use that point of differentiation to market and drive the growth of their businesses.

Sadly, in my experience, businesses such as these are very much in the minority and “we need to change our culture” is a common plea from organisations I work with. “Change your culture from what to what?” is usually my first question, and it rarely elicits a clear answer. I think that’s because culture is so pervasive within a large organisation that it becomes this huge ‘elephant in the room’ that everyone sees, but nobody likes to acknowledge or talk about. Closer questioning usually returns responses such as “our people don’t work together as a team” or “nobody seems to really care about the success of the business”, or sometimes, more honestly, “our service is poor because they don’t really care about customers”. Unfortunately by the time a business is experiencing these symptoms to the point they have become noticeable the damage has been done.

So what’s gone wrong?

Often as the business has grown the focus has been on developing the product or service and the processes that support it and not the people. New recruits have been engaged to fulfil a function with little regard for the alignment of their attitude and personality with the original business aims. Sometimes it can be that the expectations of customers have moved on and the business hasn’t adapted accordingly.

The most common reaction is to put everyone in the business through a training course on customer service. It seems like a good idea on the face of it, but I rarely see lasting benefit. Sure, if the course is well designed and executed it will provide a stimulus to the business, often for just long enough for the training consultancy to collect their, usually sizeable, cheque and run! The problem is the employees won’t have seen any significant change in the heart of the way the business operates, so a few weeks later it’s ‘business as usual’. I’m not suggesting that training doesn’t have a place, and it is important for most organisations, you just have to be clear on what it can and can’t achieve. It’s essential for teaching how a shop’s till system operates, product knowledge or how a call centre agent must include legally required statements if they operate in the finance sector. It can also set baseline standards for how customers are addressed to or how telephones are answered, but these are processes that contribute to the customer experience, they don’t define or differentiate it.

So, what do you do?

Well, you rewind the clock and try to recall the basic aims and attitudes the business started with – what did you aim to do and how did you aim to do it? This will identify and help articulate the customer experience the owner had subconsciously in their mind when they started the business. Unfortunately for many businesses this isn’t possible as they may have become too large or have been sold on by the time the culture has been identified as an issue, so those original aspirations will have been lost. In these cases it’s down to the current management to redefine the experience they want to deliver for their customers and, importantly in commercial sectors, how that will differentiate them from the competition. If a business is really brave they can ask their employees what they want their customers to experience. I have seen some really powerful definitions created by the employees of businesses whose managers have previously told me they have an issue with culture. Either way, it’s essential that the employees are consulted in this process to validate the output if they are to engage with and support what follows.

The output, however it is achieved, should be a simple statement defining what the business aims to be in terms of customer experience and the behaviours that will define it. One of my favourites is from Ritz Carlton hotels who have a world renowned reputation for great customer experiences: Welcomed, Wanted, Remembered, Cared For. Essentially, this statement is memorable and is applied both to how they treat their customers and how they treat their employees. Another one, which gives me a great sense of personal satisfaction, was created by the employees of a local government team I have recently worked with: People, Passion, Pride. The power of these statements is their simplicity, which makes them memorable, and their relevancy to the businesses’ product or service.

You also need to be careful how these statements are positioned with the employees if they are to be effective. To call them ‘vision statements’ isn’t very relevant to a front line employee and so many that I see are meaningless such as ‘to deliver world class service’ or ‘to exceed our customers’ expectations’. What do these mean in terms of behaviour to an employee on a till or in a call centre? Aspirations that are delivered as ‘vision’ or ‘mission’ statements and use meaningless management speak can only damage a businesses’ culture further by providing a breeding ground for cynicism.

So, hopefully we have done the seemingly impossible and identified and articulated the businesses’ culture in a simple statement and engaged the employees in the process. Next time we shall look at how that statement becomes a foundation for improving the customer experience.

Managing Knowledge Through Culture and Technology

2008-12-23T11:12:00.005+00:00

Following on from my previous point that surfacing and sharing knowledge could be a crucial factor in survival right now, the underlying enabler in leveraging this knowledge is culture. If your organisation doesn't already have a knowledge sharing and evolution culture, then all the information you store is only of limited use.

The typical view amongst many culture change consultants is that culture is about people and therefore all change strategies must focus entirely on human structures. A business issue. Behaviours, communications and processes; not technology. The vertical split in function and skills dividing business and technology in most commercial and consulting environments, compounds this division and embeds it into our ways of thinking.

The reason I make this point is that we live in a time where technology and human behaviour are so closely inter-twined, even for those who consider themselves technophobes, that ignoring one or the other just increases the difficulties in changing culture.

Technology by its nature is an enabler, facilitating our ability to do virtually everything, all the way from computing and working to socialising and entertainment. A great example of technology driving culture is the way social utilities like Facebook have single-handedly raised the web literacy of a whole generation.

If leveraged sensibly then, technology can greatly facilitate and speed up culture change around knowledge management by providing a directional platform that removes the barriers to sharing and evolving knowledge, driving new behaviours and ways of thinking that over time become embedded into organisational norms i.e. culture.

The key here is to think of change as a journey, rather than a big bang - if you want it to be painless anyway! People need time to learn and adapt so my suggestion is to approach the development of knowledge sharing in terms of maturity, where technology supported by a change programme evolves the immature information capture state towards more complex social interaction around knowledge and innovation at the end of the journey.

The following is a Knowledge Management Maturity Model I've sketched out to illustrate what I mean:

Customer Experience Pt 2 - Identifying and Managing Culture

2008-12-12T09:18:00.005+00:00

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris, Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

Last time I attempted to put into some context the importance of business culture in the overall operating model and consequent customer experience. In this piece I hope to give some thoughts as to how it can be identified and managed to positive effect.

So what is culture?

In the simplest of terms it’s ‘the way we do things around here’. There have been many academic studies on the subject but, in my view, intellectualising the subject is unlikely to help a business shape its culture from an operational perspective. What most of the studies agree on is that a culture is created from an amalgam of the businesses’ activities both past and current which will include: stories of previous events, organisational structure, how power is disseminated or not within the organisation, symbols such as management parking spaces, dining rooms etc, leadership style and many more depending which study you happen to read.

In essence though, it does amount to ‘the way we do things around here’ but how do you shape that in practical terms and what is a good or not so good culture?

Shaping Culture

Well, that all depends on what you are trying to achieve in the organisation which is where it gets so complicated. However, considering what sort of culture you want to create in the organisation is an essential starting point and one many organisations ignore. Perhaps it would help to give a couple of, admittedly extreme, examples to illustrate the point: I don’t want a junior surgeon to be creative or empowered if they are operating on me, nor do I want a troop of soldiers to feel empowered to question orders in a battle situation. BUT, and this is the challenging bit, I do want a senior medical practitioner to be imaginative and creative as that is how advances in learning are made and likewise I would want our senior military figures to be creative in their strategy and tactics as that is often how battles are won. So the culture you create very much depends on what you have to achieve in the organisation and, in the examples I have given, this may even change for different parts of the organisation.

Fortunately many organisations aren’t responsible for the nation’s defence or advances in medical science so it can be a little more straightforward!

An Illustration

Let’s go back to the small business I talked about in the last piece. The owner is initially the only employee and is likely to have a clear idea of how the business is to interact with its customers and have a passion for the success of the business. This may be as simple as being efficient and polite, but it may include thinking creatively to offer a very personalised service, or wanting to be known for being informal and especially welcoming or some other point of differentiation the owner has identified. The culture won’t be explicitly articulated because it doesn’t need to be – it’s in the owner’s head!

As the business finds the culture is successful and appealing to its customers it will grow and the owner will recruit more people. The people recruited are likely to share the owner’s own views and attitudes just in the same way as we subconsciously choose friends with whom we have common views and attitudes. The new recruits are also likely to have an affinity for the business and a passion for it to succeed or they wouldn’t have been recruited in the first place. So, we now have a business of 10 employees all of whom know the owner and work closely with them on a day to day basis, being kept abreast of new developments and thinking as the business grows. If the recruitment has been done with care, these ten people will share some common views, attitudes and approaches to the organisation that will bind them together as a cohesive unit with a real sense of common purpose and a desire for the business to succeed. Nothing will have explicitly been done to shape the culture, but implicitly the workforce will have come together as a group of like-minded individuals.

So far, so good but what happens when the business gets really successful and grows to 100 employees?

Managing Culture

At 100 employees, the latest recruit often won’t have a close relationship with the owner and is less likely to have been personally recruited by them. They may well be working to pay a mortgage, support a family, buy a new car or whatever else, but it is unlikely they will automatically share the passion the owner has for the business. And that’s with just 100 people! When you get to 1000, 10,000 or 100,000 the recruitment and its leadership can be so far removed from the original aims of the business that the people making the recruitment decisions may not be clear about the owner’s original overall aims, let alone the views and attitudes the people they are recruiting should have to achieve them.

So, at what point does the culture move from something implicit to require explicit shaping and leadership? I don’t believe there is a definitive answer for that question, but it is likely to be the stage at which the business has got to a size at which the latest recruit does not have day to day contact with the owner. At that point the owner needs to stop, think carefully and clearly about the views and attitudes that have made the business successful to date and how to ensure they are replicated with every new employee and frequently reinforced for the existing employees. Sounds simple and perhaps obvious, but it rarely seems to actually happen which can be very damaging as it’s so much harder to change a large organisation’s culture when it has become firmly established than it is to shape it as the organisation builds.

So, I hope I have provoked some thoughts about the culture of a business and how it can be identified and shaped to be a great attribute or, as is often the case, how it can be very damaging to the future well-being and growth of an organisation. Next time we will look at how you define or actively start to change an existing organisation’s culture.

Customer Experience Pt 1 - Introduction

2008-11-10T11:30:00.006+00:00

Post series written by Andrew McMillan (Principal Consultant at Charteris specialising in customer experience). Before joining Charteris Andrew had a 28 year career with John Lewis and spent the last eight years of that career being responsible for the quality of service and selling across the UK department stores.

This series of blogs is about what it takes for any organisation to deliver a consistent and distinctly identifiable quality of service through its employees. I would welcome, and will respond to, any comments or thoughts of your own that you may wish to add as we go.

Delivering Customer Satisfaction

I want to start by putting the customer experience factor (or whatever you might choose to call it) into some context with other business activity.

In simplistic terms the customer experience and consequential satisfaction or otherwise of a customer delivered by any organisation can be divided into 3 key areas:

The competiveness/desirability/relevance of the product or services the organisation is providing.
The effectiveness of the systems or processes to deliver that product or service to a customer, in other words – how easy are you to do business with?
The way the staff in the organisation interact with its customers, ideally leaving them feeling they have been treated as an individual rather than being part of a process and, when appropriate, genuinely cared for.

If you were starting your own business tomorrow it would probably be because you felt you had an idea for a product, proposition or service that nobody else, or nobody else in your area, offered. Possibly this might be offering better quality or price than any existing potential competitors too. Consequently that has to be the starting point for all organisations as it must be the reason for their very existence. If the product or services you are offering don’t represent an attractive proposition for your target customers the organisation is destined for failure.

What’s next?

Well there is no point in having a great product or service if your customers find it easier to do business with your competitors. The systems and processes are very important as in a time pressed world nobody appreciates confusion, complication or errors. The knowledge and advice you are able to impart about your product or service are also very important as you will be perceived as an expert in what you do and customers will want to trust your advice.

Finally, you are really going to look after your customers and care about them individually as you will want the business to grow. Consequently you will want your customers to come back and bring their friends because they have enjoyed dealing with you.

So, all pretty obvious stuff, and even more obvious if you are still thinking of a small business where the owner is the person the customers interact with. Of course you are going to be easy to do business with and you are going to care about your customers and leave them feeling good about the transaction because you have a vested interest in making the business succeed.

What happens when the organisation grows to 100 employees? Well, the product or service will remain the same or perhaps diversify a little and the owner is still likely to be driving the development. The systems and processes may have become more complex as the organisation has grown but, to a large extent, the logistical challenges of the growth will have ensured the processes have developed in tandem.

So what about the people and customer experience they deliver?

Intentionally or accidentally, the organisation will have developed its own culture and that will have a significant effect on how its customers are treated as the owner will no longer be dealing with each customer personally. That will affect how those customers perceive the business when they interact with it. However, because the culture of a business is less tangible than its products, services or processes it is often the case that there is less overt awareness of how the evolving internal culture can affect customer service. This can often be to the detriment of the business as a whole, which is why I believe we have such a reputation for poor service in the UK.

So, I hope I have put business culture into some degree of context within the overall operating model. Next time we shall look at culture and how you can positively shape it in a large organisation.

---------------------------------------------------

Contact - andrew.mcmillan@charteris.com

Customer Advocacy through Compelling Customer Experience

2008-10-31T08:22:00.001+00:00

What percentage of value-add activity are you achieving in your customer facing operations?
If less than 80%, then it is time for action

How many of your front-line staff can answer the question “how have I added value to customer experience today?”If less than 90%, then there is too much wasted effort and higher than necessary costs

Do your customer facing people and systems consistently help & drive enhanced customer experience?
If you are not very sure then there is a compelling case for a “voice of the customer” review of your systems and processes

Are your customer-facing staff systems and product experts or customer problem solvers?
If just experts then they – and therefore your organisation – will benefit from being problem solvers

How do you spot and remove barriers to rich customer experience and people motivation? Find out about “voice of the customer” at www.charteris.com/what_we_do/customer_centricity/

Making banking customers' experience compelling whilst cutting costs

2008-10-30T09:52:00.008+00:00

"Your call is important to our bank; we’ll be with you as soon as possible....in the meantime here is some mind numbing music"

Ten years ago or so banks like many other major businesses recognised the opportunity to cut costs by directing more customers away from higher cost, face-to-face channels to call centres. They wanted to maximise the use of centralised customer contact centres to deliver a more efficient, consistent and auditable service. However, in the pursuit of cost reduction these organisations lost sight of the most important factor: the customer experience.

No business can afford to provide excellent customer service at any cost. But equally, no business can afford to ignore the importance of customer satisfaction.

Call centre cost reduction strategies like off-shoring or technology outsourcing have failed because they focus almost exclusively on improving the bottom line. They have not properly considered the implications for enterprise processes and management approaches and, more importantly, have not focused on the customer. So, anticipated financial and operational benefits have not been fully realised and customers remain largely dissatisfied i.e. a vicious circle.

Customer dissatisfaction has led to many institutions reversing their earlier decisions to offshore call centre operations. In their adverts many banks now make a point of having UK based call centres.

But cost savings and service improvements do not have to be mutually exclusive. If the customer experience is placed at the heart of a business transformation programme, opportunities can arise to improve both customer service levels and cut waste.

The Art of Possible:
There are three layers of corporate process that fundamentally drive performance excellence in a contact centre. They are contact centre strategy, operational planning and tactical execution. The strategic thinking, business analysis, detailed planning and communication that occur at each of these layers must be highly integrated from both the bottom up and the top down.

Only then will banks be able to determine where they are going – and have confidence in the belief that they are really going to be able to get there.

Saving costs and improving customer experience need not be mutually exclusive.

At Charteris we have customer centric contact centre expertise with experience gained in some of the country’s largest and most successful contact centres.

hoss.atri@charteris.com

Multi Channel Retailing - Putting the Customer First - Part 7 - Creating Agility......The end goal

2008-10-27T22:15:00.001+00:00

Putting it altogether; the IT, the business organisation and a service oriented architecture, will provide a retailer with:

an IT architecture that allows change, rather then dictating what changes can be made.
a business that is geared to meet the needs of the channels and ultimately its customers
a multi-channel platform that will last, adapt and perform

In summary, multi-channel retailers require agility and in delivering these key assets, a retailer can acquire the lasting agility that will differentiate them in the marketplace. Agility can be measured in many ways but there are some simple measures to consider in assessing just how agile a retailer really is. For instance, how long would it take to do the following:

introduce a new range or products across one or more channels?
open a new channel (such as a concession or mobile commerce platform)?
react to a competitors promotion?
introduce regional pricing and promotions?
introduce differential pricing across channels?
start marketing internationally

If the answer to any of these is “longer than my competitors”, then there is room for improvement. Taking the customer centric approach will shortcut many of the hurdles in assessing what needs to be done and partnering with Charteris is a firm step towards creating agility.

The Charteris Approach
At Charteris we define Customer Centricity as “the alignment of organisational structure, processes and technology to deliver products and services to internal and external customers in the most agile way.” Applying this to multi-channel retailing is what we do best and have wide experience in making this not just a theoretical exercise, but making it real.

Mobile Banking and Payments Innovations

2008-10-26T11:40:00.009+00:00

The Demise of Cheques?

When did you last write a cheque? The average person in the UK now receives less than seven cheques per year. In 1990, 11 million cheques were issued per day, in 2008 the daily volume is approximately 4million cheques and APACS estimates that in eight years time there will be only 2.5 million cheques per day.

Non-paper based payments like direct debits, direct credits and cards have reduced the need for cheques. Insurance claims are now settled via direct bank transfers or pre-paid cards for the smaller amounts. You can now draw larger amounts over the counter at your bank branch using your chip and pin card as your proof of ID. So, why are there still 4 million or so cheques issued a day?

The main culprits include person to person and person to small business payments. This is because as yet there is no infrastructure in place in the UK to provide an electronic payments system for these payment types.

Now with the new UK Faster Payment Service - you can get the latest updates here – ramping up, the industry has taken the first step towards the eventual elimination of cheques. All that is required next is for your banks to enable you to download from their mobile banking site a mobile payment application that becomes a function of your mobile banking service.
OK, there is more to the technology jigsaw puzzle than my “all you need” but it is not rocket science either. A main component will be a bank and mobile operator agnostic database that securely stores you m- credentials and keeps these up to date. There are also a few governance, security, privacy and exception management considerations to iron out.

But m-payments will be a compelling win-win proposition for payers, for beneficiaries and great for the banks’ relationship with their customers. It has the potential for the banks to innovate new customer centric experiences for all of their customers.

Who needs cheques now? Imagine.... you can pay “Joe the plumber” for fixing your pipes by pressing a few buttons on your mobile and by the time he finishes saying thank you he gets confirmation of settlement from his bank on his mobile..same mobile also tells him that he should now transfer some money to his personal account to avoid going into the red.

The British a nation of shopkeepers? More like a nation of bankers.

Multi Channel Retailing - Putting the Customer First - Part 6 - The Customer Centric Approach

2008-10-24T22:13:00.000+01:00

In gearing any part of an organisation to deliver a service, whether it be technology, system, process or people related, an understanding of the customer is vital. For example, a retailer who also provides white label channels has not only the end consumer to consider, but also the partner organisations to whom they provide white label solutions. Similarly, merchandisers, graphic designers and cataloguers servicing more than one channel can consider each channel as a customer. When an organisation starts to think along theses lines, about who their customer really is, then the implementation of a service led philosophy becomes an easier task. Underpinning this approach is taking a considered view of the customer in order to understand their motivations, behaviour, likes and dislikes.

Taking a customer centric approach enables each area to focus on delivering exactly what the customer wants. Critically analysing processes, systems and related functional areas and determining their effectiveness in delivering customer service is at the heart of the customer centric approach. Breaking down each element and step of a process and stripping out those that do not add value to the customer can create efficiencies and benefits across the organisation. In doing this, the multi-channel retailer can create a framework of services that is ultimately geared towards the customer rather than the requirements or functions of a particular channel or technology.

Can banks cut more costs without risking customer service ?

2008-10-24T17:10:00.003+01:00

Cost reduction through improving operational efficiency has been a consistent goal of financial services organisations. Techniques such as Lean have been adopted with significant success in many organisations.

However, recent research indicates that the pure application of such techniques, which were originally designed for the manufacturing sector, can be detrimental to customer experience when applied to service organisations.

In essence, process optimisation motivated primarily by a desire for cost reduction can lead to decisions which are detrimental to customer service.

Meanwhile , the behaviour of the financial services consumer continues to evolve; more sophisticated, more demanding and more likely to complain or transfer their business if their expectations are not met. Simultaneously, financial services organisations are recognising the true lifetime value of customer retention; looking to cross-sell and up-sell to their existing customer base.

In this context, what financial services organisations need is the confidence that their business critical process change programmes will enhance customer experience not acting to its detriment.

The key to drive business change successfully is direct and continuous engagement of the customer within the change process. Customers are the ultimate arbiters of the success of change initiatives – their “voice” can not only be a compelling reason for change but, properly engaged, an extremely effective shaper of that change.

Chaos reigns in the world of spreadsheets

2008-10-24T16:50:00.005+01:00

Thanks to its relative ease of use, flexibility and low unit cost Excel has matured to become the most pervasive business tool for risk modelling, financial analysis and reporting applications. But Excel’s perceived ease of use and flexibility have become both its strengths and its weakness.

In many instances though Excel models operate outside normal governance and control mechanism, giving rise to increased risk of failures in such critical areas as valuations, assessments, premiums, trading and financial reporting.

At the other end of the scale, many enterprise risk and financial modelling services are hard coded into line of business or specialist applications. The process for defining and changing these services is complex, time consuming and expensive. Typically it impacts a range of systems and requires lengthy interactions between subject matter experts (e.g. risk analysts, financial analysts, researchers and statisticians) and IT development teams.

Often this results in:

Poor time to market for new deals,
higher than necessary development costs
Less than optimum productivity

In my view the effective solution is effective spreadsheet management requires a risk framework encompassing

spreadsheet lifecycle and content management and version control
quality assurance, security and access control
regulatory and corporate compliant business processes
access to information required for reporting

..... will continue

Multi Channel Retailing - Putting the Customer First - Part 5 - Business Architecture.....The afterthought

2008-10-23T22:09:00.003+01:00

Structuring the operational model around the new architectures and solutions is often left as a last minute consideration in delivering any new system. Organisational structure and associated processes are vital in order to deliver the most customer focussed experience and service possible. Every aspect of the operational model needs to be visited and assessed to determine the value it actually delivers to the customer and ensure that the priority and focus is aligned to this strategy.

This is where the thinking around the use of SOA needs to break out of the IT box and permeate through the business functions and respective processes. This is where the hard questions can often be found and where the structure of business functions needs to be most challenged. However, the balance of dividing business functions amongst the selected channels as opposed to maintaining a centralised operational model is a real tightrope and one that can only be managed on a case by case basis.

Creating a business architecture by applying SOA principles is not an exact science in some respects is still in its infancy. Even considering the business and operational model as an “Architecture” is a step too far for some organisations. But, those that have embraced this philosophy have broken out of the traditional business models and created cross functional working units geared to providing services to their customers, whether internal or external. This approach not only is geared towards a value added customer experience but leverages the experience and expertise of the people within an organisation.

5 Key Issues Facing Retailers Trying To Become Multi-Channel

2008-10-23T08:23:00.003+01:00

I'd argue that the underlying success factor in multi-channel retail from an external perspective is a seamless customer experience, and from an internal perspective is a single customer view - different sides of the same coin. Most of the challenges to any retailer appear to stem from attempting to achieve this.

The two key areas of impact here are technological and organizational dependent on retailer age and size. The older the organization, the more likely they are to have legacy systems, and the larger they are, they more likely they are to face resistance to change. Multi-channel may therefore require integration of disparate technologies, while also needing a complete review of structure, skills, staff incentivisation, and a host of other business and marketing processes.

The 5 main issues faced by large retailers entering the multi-channel space are as follows:

Evaluating cost of investment in development of cost effective, secure, scalable environments and systems integration against probable short term impact on bottom line
Pricing across different channels - Store channels have higher cost structures than web channels for example, and price competition is higher on web, but consumers can be put off by different pricing for the same product
Channel synchronisation i.e. ensuring brand, customer experience and customer information consistency across channels while avoiding the 3E trap i.e. trying to provide ‘everything to everyone everywhere’
Problems in merging and standardising customer data i.e. unifying different systems which may have very different data models
Difficulties in reducing or abolishing organisational boundaries to cope with new channels

In summary, customers for whom a multi-channel approach will yield the most benefits are often those for whom achieving it the most problematic – they have the largest customer bases, most complex lines, and longest histories of systems development, with many business critical systems that supply old CRM processes.

Multi Channel Retailing - Putting the Customer First - Part 4 - I thought SOA was just an IT thing!

2008-10-22T22:07:00.004+01:00

From an IT perspective, the use of SOA (Service Oriented Architecture) is a logical fit to fulfil the multi-channel solution where core capabilities such as product, delivery, payment etc. are developed in such a way that they are created as services allowing for re-use across the enterprise. However, if the IT department is the only place where the SOA principles are adopted, then there can be no real alignment between IT and the business. Therefore, it is essential that the SOA blueprint is adopted throughout the enterprise rather than remain solely as just another IT acronym. In order to achieve this, the entire organisation must adopt SOA principles and the blueprint for this ideally is owned by the business. If the IT department alone is trusted in implementing the SOA architecture (as is so often the case), then the chances of the remaining parts of the organisation fostering the principles of SOA (and hence the benefits) are somewhat slim.

Multi Channel Retailing - Putting the Customer First - Part 3 - Surely, IT has all the answers!

2008-10-21T22:01:00.011+01:00

So, the decision has been made to create a new architecture and it’s all hand on deck. Constructing the great new systems and solutions to support the multi-channel ambition is one thing, but there are many other considerations which are just as important. IT is undoubtedly the key enabler in this relentless march towards customer satisfaction, but it is truly only one part of the jigsaw. The creation of a technical architecture that is aligned to the operating goals is vital; less so is the selection of the exact technology as there are various products and technologies that can be blended together to form an effective solution. In addressing the architecture issue, the creation of a Service Oriented Architecture (SOA) is widely recognised as the best practice approach and one that dovetails into a customer focussed strategy.

The key benefits of SOA in a multi-channel strategy are one of re-use and the ability to initiate changes (to business or channel specific rules and functionality) without having a knock-on effect to all parts of the organisation. As discussed in my posts on the practicalities of multi-channel retailing, re-using components such as inventory, delivery and payment across the channels as services increases the efficiency and realises cost savings across the channels. However, the full benefits can only be full realised by creating a business logic layer across these services where specific attributes cater for the requirements of each channel. This is where such elements as price, promotions and catalogue are controlled and provide the channels with independence despite sharing a common data set.

Meeting Performance Challenges In Local Government

2008-10-20T09:48:00.003+01:00

Here are the 5 key performance issues facing Local and Regional Government right now:

There is no common understanding of hundreds of performance indicators (PIs)
Accessing the data necessary to derive each PI is difficult
The quality of data is poor
The cost of reporting is high
Use of performance reporting is poor

Andrew Rogoyski, Head of Public Sector at Charteris, explores these further and covers the ways the LRG's might look to address them in his paper on "Performance Management for Local and Regional Government Organisations in England" below.

Performance Management for Local and Regional Government Organisations in England - Upload a Document to Scribd