Building Support Capabilities to Achieve Differentiation
In a world of increased competition, organizations increasingly are turning to support as a way to achieve long-term differentiation for their products and services. Customers often see as much or more value in the support that an organization offers as a part of its products and services than in the products and services themselves. Best-in-class support organizations confirm that the optimal way to master support is to achieve success initially from within the organization, and then expand these efforts outward through the distribution channel and ultimately to their customers.
Perhaps contrary to popular belief, it is the small and medium size business (SMB) sector that leads the way in using support capabilities to secure long-term competitive differentiation and to lock in long-term customer loyalty. Integrating support capabilities into products and services does require a structured approach - based on people, process and technology. Fortunately several Customer Relationship Management (CRM) software vendors understand the significance of helping organizations with their support capabilities. These vendors have built CRM software modules that include valuable support capabilities.
There also are a number of support trends that are beginning to change the way companies offer their products and services. Assuming an organization is serious about achieving long-term differentiation, building support capabilities into an organization's products and services is no longer a 'nice to have' but rather a 'need to have'. Given the varied use of terms in the industry, customer call, contact, interaction, service and support center have been used interchangeably.
Achieving Long-Term Differentiation Through Support Capabilities
While an organization can differentiate their products and services from those of the competition in the short term, in the long term all products become commodities. Why? Because an organization's products and services may have an advantage over the competition one moment, but the next moment this advantage reverses. What this means is that competitive products and services, tied together with excellent customer support has become the most effective combination to differentiate an organization's products and services in the long-term. Here is an example.
Company X is a global apparel manufacturer, concentrating on the teenager segment. As an active listener to their customers and to the marketplace, Company X knows that their products are perceived to be among the very best. They also know that they need to continuously improve their relationships with employees as well as with their retailer distribution channel. So Company X's top management team has taken the decision to make support capabilities a key component of their long-term differentiation strategy. For example, for internal customers, Company X has launched a significant service management strategy whereby employees will have direct access via personalized portals to all types of company support functions ranging from the IT help desk to new job postings.
For their external customers, Company X has launched significant self-service capabilities for the smaller retailers. These retailers are now electronically linked to Company X; they place their orders, confirm stock availability, make payments, and lock on delivery dates on-line. For the mid-size retailers, Company X has opted to create multiple retailer segments, to build comprehensive customer profiles for each retailer segment, and to provide different levels of support per retailer segment. Within one such segment, Company X now utilizes wireless, handheld devices to take stock, to automatically generate replenishment orders, and to confirm in real-time dependable delivery dates. For the largest retailers, Company X has created an impressive account team program filled with tailored support capabilities. Each retailer account team has access to a common retailer profile, performs retailer planning, and delivers and monitors negotiated service levels on a daily basis. While the results are still being monitored, enhancing Company X's products with support capabilities appears to be a sure way for them to secure product differentiation and long-term customer loyalty.
Start Mastering Support Capabilities From Within The Organization
While support capabilities are eventually offered to an organization's external customers, best in class support organizations confirm that the optimal way to perfect the process is to initially practice and support capabilities internally. Internal support capabilities may include, for example, IT services such as help desk support, asset management, hardware support, mobile computing support, and or network and systems management support. The idea behind mastering support capabilities from within is to demonstrate to employees, using real-life situations, how to achieve superior support capabilities.
This will also allow employees to feel the value of receiving the superior support that ultimately all customers crave. Based on this experience, when the time comes to extend support capabilities to external customers, happy internal customers take pleasure in going the extra mile to drive support excellence. Mastering support capabilities from within is exactly how the City of Des Moines, IA successfully built its well-documented Citizen Response System. The City of Des Moines strived to be one of the best-run cities in the country and wanted to automate the way in which it received, managed, responded to and ultimately resolved requests from its 200,000 citizens. The city had already implemented the HEAT Service & Support software solution, to assist its internal IT help desk in managing calls and providing problem resolution for users of its computer and network systems. After examining a range of possible solutions, the city's process improvement team decided to leverage their internal support experience and settled on using HEAT as the logical extension for their external Citizen Response System initiative. To learn more about this very successful CRM implementation, see Gartner's 2002 Case Study CS-18-5498, titled "City of Des Moines Brings CRM to the Public Sector." Also see Aberdeen Groups' What Works© CRM Top Ten 2001 paper.
Getting Your Support Capabilities Right
What support capabilities are needed? While this will differ for each company, here are some essential components for internal support as exemplified by the internal IT Help Desk and for external support as exemplified by the external Customer Support Center.
IT Help Desk
Since adoption of distributed computing, IT departments have been faced with an increasingly difficult task of managing the support of IT services. The arrival of e-business has led to additional pressures on IT departments to provide things such as access to Internet-based applications 24-hours a day, seven days a week. Needless to say, this has amplified the need for a well thought-out IT help desk strategy, inclusive of effective processes (e.g., problem resolution), appropriate levels of technology (e.g., remote support tools), and a comprehensive data architecture. Poor implementation of the IT help desk can result not only in failure to realize the benefits of applying process enhancement and automation, but more importantly potential damage to the IT department's reputation.
Customer Support Center
While there is commonalities with IT help desks, customer support centers tend to capture customer data into applications that enable more focused customer service and an increased emphasis on first-interaction resolution. Customer support centers also use this customer data to identify and realize cross and up-sell opportunities, determine future marketing activities, and offer more personalized interactions. Critical to the success of a customer support center is the company's ability to employ 'customer-sensitive' personnel, train them well, and put into place the best tools and processes for helping these personnel deliver the 'optimal customer experience' each and every time.
Here then are some common and some unique service capabilities that a company will want to consider in support of long-term differentiation.
Common functions for both the IT help desk and the customer support center include:
. Logging of problem calls/emails
. Assigning one owner to each problem
. Escalating problems as needed
. Tracking problems through to resolution
. Building a resolution knowledge base for use by both internal personnel and eventually external customers
. Identifying problem trends, and recommending pro-active corrections (e.g., product modification or enhanced training)
Unique functions for the IT help desk include:
. Supporting and tracking configuration changes, tracking IT inventory, and managing the company's IT assets
. Creating and implementing meaningful service level agreements
. Developing and utilizing management reports for evaluating vendor equipment, improving service-level agreements, and for proactively servicing IT-related customer issues
Unique functions for the customer support center include:
. Dispatching and field servicing
. Cross-selling and up-selling
. Managing opportunities
. Determining appropriate marketing activities (e.g., permission-based marketing)
. Promoting personalized interactions (e.g., via personalized portals)
Small And Medium Size Businesses (SMBs): A Golden Opportunity
While there are a number of global companies (e.g., Cisco, GE) that have pro-actively adopted
support capabilities as a part of their long-term competitive differentiation, the single largest group of organizations that have and will continue to lead the way in offering support capabilities are the small and medium businesses . There are very good reasons for this trend. SMBs tend to work in crowded and highly competitive marketplaces. Doing more with less is the norm. Personnel tend to be stretched to the limit. Cost cutting is prevalent. So when new processes and technologies come along that can help the SMB cost-effectively achieve long-term differentiation, they become of great interest. Moreover, unlike larger organizations that may get bogged down in internal bureaucracy, SMBs tend to be able to adopt and leverage these new processes and technologies more quickly. Given their need to out-fox the competition and to secure long-term customer loyalty, the SMB marketplace is a golden opportunity to apply support capabilities with great success.
A Structured Approach For Developing Support Capabilities At SMBs
SMBs that have successfully developed excellent support capabilities have applied a three-step structured approach - based on people, process and technology - to achieve long-term product and service differentiation. Here are the highlights of this approach.
Process
It all starts with the process piece. This piece accounts for 30% of the overall success of complementing products and services with support capabilities to achieve long-term differentiation. When implementing the process piece, it is important for the organization to map out and document key internal and external customer-facing support processes. Look at each identified key process and determine whether it is optimal or could be improved. These are the types of questions you will want to ask to determine the current viability of each identified key support process:
. Ownership: Does the process have one or more than one owner? A process may have more than one person or department participating in the process but successful processes will have only one owner.
. Metrics : Does the process have a stated metric (e.g., we will resolve 90% of customer support queries within one hour)? Remember, "If you can't measure it, you can't manage it."
. Interfaces : What other persons or departments are involved in the process (e.g., in a customer support center, sales as well as product development may be involved in helping to resolve a customer issue). In a successful process, these interfaces are well greased and information flows across persons or departments seamlessly.
. Procedures : Does the process have clearly stated procedures so that regardless of who is working with the process, one knows how to implement each step of the process? In a successful process, the steps of each process are well documented and available to all potential users.
. Integrity : Is the process practiced the same way for all customers? In successful processes, in addition to documented procedures, all relevant personnel have been trained to apply the process consistently.
. Vision : Does the process support the long-term differentiation via support capabilities of the organization? In a successful process, this linkage is obvious. Often organizations get carried away with process analysis, and too quickly get into analysis paralysis. Remember, chart out key customer-facing processes initially. This usually consists of 6-12 processes, not more. Get these key processes right; where appropriate sub-processes will follow. If you are stuck determining what constitutes a key process, ask the customers.
People
Next comes the people piece of the approach, which accounts for 50% of the overall success. People are naturally resistant to change - unless properly planned for, change can actually be seen as disruptive - and thus people may be hesitant to want to complement products and services with support capabilities to achieve long-term differentiation. To overcome resistance to change:
1) Be sure that relevant internal and external customers are aware of the pending support changes.
2) Take the time to help these customers to understand what these changes are going to mean for them (e.g., more efficient and rewarding work).
3) Help them adopt the idea of enhancing support capabilities. Show them the impact that this has had on other companies. Take the time to train them.
4) Get them involved in the change process; invite them to join the discovery team or task force responsible for successfully introducing new support capabilities.
5) For those customers who get involved and come to see the value of enhanced support capabilities, make them your change management agents or ambassadors. Gain their commitment to help others understand why enhanced support capabilities are the right way to go.
Simply put, people make or break a company's ability to develop and successfully implement support capabilities to achieve long-term product and service differentiation. Take the time to work with people to drive success.
Technology
Last comes the technology piece of the approach. This piece accounts for at most 20% of the overall success of expanding your support capabilities. Why? Because there are many fine technologies currently available to help both internal and external customers receive increasingly higher levels of support. The issue tends not to be one of technology, but rather readiness of the company and its customers to absorb and properly utilize the new technology (i.e., the process and people side of the equation).
When a company selects its technology - specifically its software - partner for enhancing support capabilities, the following types of questions tend to get asked:
.- Does the software vendor offer both internal support products (e.g., IT help desk support software) as well as external support products (e.g., customer support center software)?
.- How seamlessly integrated are the vendor's support products?
.- Does the vendor have a proven track record implementing these products?
.- Does this include experience in the company's specific industry?
.- Does the vendor offering include needed implementation and maintenance support for their products (either themselves or via partners)?
.- How well and easily do the vendor's support products integrate with other CRM software components such as sales, marketing, business analytics or e-Customer applications? Are these other CRM software components their own or third party applications? How are third-party components maintained?
.- Does the vendor work (either through formal or informal alliances) with other relevant vendors that form a part of your enhanced support capability solution, e.g., with hardware vendors, communications equipment vendors, network vendors, business process consultants, etc.?
.- Is the vendor's product based on technology that meets current company goals and direction?
A word of caution: one can easily get overwhelmed or even carried away by the technology piece of this structured approach. Remember, it starts with good internal support processes that are then extended to external customers. Next comes needed change management skills to ensure that people buy into the need for the change that comes along with enhanced support capabilities. Then and only then does one turn to technology.
Trends In Customer Support
In closing, here are several customer support trends worthy of noting. These trends have already and are likely to continue to impact both internal and external support capabilities, which in turn impact a company's ability to achieve long-term differentiation for their products and services.
. Unrelenting Customer Demand : As customers personally experience more support options, they are becoming less tolerant of long calls, long waiting times, inaccurate answers to questions, poorly trained support agents, and the inability to access their own information and resolve their own issues. Unless addressed with urgency, this is likely to lead to frustration and customers taking their business elsewhere. In fact, Gartner predicts that 75% of companies will continue to fail to fully meet customer expectations for customer support excellence through 2007, and the result will be average turnover of 100% of the customer base every five years.
. New Revenue Opportunities : While unrelenting customer demand may negatively impact a company's customer base and resulting revenues, if properly addressed, unrelenting customer demand also provides a tremendous opportunity to generate new revenues. The percentage of support centers whose agents actively cross and up-sell is less than 5% today. Gartner predicts that by 2007, 40% of all support centers will have a significant impact on an enterprise's revenue stream. This large potential implies many new support needs including specialized training, holistic customer profiles, available cross and up-sell information, etc.
. Cost Reduction Pressures : It currently costs a support center $12 for a non-technical call, and $12-$18 for a technical call. Compare these costs to Giga's finding that unassisted services such as email, auto-response, and Web self-service average $.50 per transaction, and one quickly understands why there are cost reductions pressures within support centers. Moreover, an inefficient support center can lead to expensive and even unnecessary IT developments, high system maintenance charges, high training costs, high telecommunications charges, etc.
. Much More Self-Service : Demand for self-service has and will continue to grow exponentially for many reasons. Chief among them is the www generation that prefers to take charge and resolve their own needs online. Take note: the www generation isn't going away. Whereas 3% of the American workforce currently works in support centers, the forecast by 2010 calls for 5% of the American workforce working in support centers despite high support center attrition rates that currently run between 15-30 percent annually.
A second important reason is the cost reduction pressures described above. Organizations are desirous and are even encouraging customers to perform their own self-service to receive answers to repetitive-type questions, thereby leaving support centers to concentrate on exceptions and more relevant customer experience issues as well as maximize support center efficiencies.
Both of these reasons imply the need for increasingly sophisticated e-support tools to provide customer advice and problem resolution (e.g., integrated phone/email/Web tools, knowledge management systems, remote support capabilities that resolve issues over a LAN or WAN or via phone lines or a modem). In fact Gartner predicts that by 2007, 70% of all support centers will have implemented Web-based support applications.
Perhaps more importantly, these two reasons imply the need for well thought-out, proactive programs that encourage and facilitate internal and external customers to increasingly perform self-service.
. Demand For Real-Time Customer Service : Thanks to the Web, customers now expect real-time information and even real-time support. Some customers have even begun to demand it! Yet few organizations today are cost-effectively using customer support capabilities, and even fewer are offering such capabilities in real time. This implies a potential need to create real-time enterprises that offer an integrated customer support framework that provides real-time and complete views of the customer support issues across all customer-facing channels.
. Growth In Integrated CRM Applications : All of the above point to a final important trend, namely the need for tighter integration across sales, marketing and customer support applications. This results from cross and up-selling becoming increasingly a part of a company's support capabilities, on-line marketing and sales becoming increasingly intertwined, and sales and customer support needing to work together in real-time.
Building Support Capabilities: Now More Than Ever
A recent study sponsored by staffing firm Kelly Services and Purdue University's Center for Customer-Driven Quality concluded:
. 92 percent of U.S. consumers form their image of a company based on their experience using a support center.
. 63 percent of consumers will stop using a company's products or services based on a negative support center experience.
. Among those calling to express dissatisfaction with a product or service, 86% were more likely to stop using the company if their experience with the customer support agent was negative.
Simply stated, support capabilities aimed at addressing the needs of internal and external customers have become an increasingly important component in ensuring higher levels of quality service, building and sustaining optimal customer relationships, and creating long-term customer satisfaction and loyalty.
