Invisible Customer Service:

The Customer Must Be Reminded of How Good You Are!

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This guest blog post is from Shep Hyken. Shep is a customer experience expert and the Chief Amazement Officer of Shepard Presentations. He is a New York Times and Wall Street Journal bestselling author and has been inducted into the National Speakers Association Hall of Fame for lifetime achievement in the speaking profession. Shep works with companies and organizations who want to build loyal relationships with their customers and employees. For more articles on customer service and business go to http://www.hyken.com.

When we talk about customer service, what usually comes to mind is the experience you have when you shop in a store or eat in a restaurant, or the relationship your company has with a vendor. It’s easy to know if you are receiving good customer service – you judge it by the interaction with the salesperson or server, by the timeliness and accuracy of deliveries, or the ease of dealing with a customer support center. It’s apparent when these companies are delivering on their promises. However, there are some companies in which the service may be less visible, maybe even invisible.

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My laptop computer recently locked up. When I purchased it, I got the three-year extended warranty, and luckily, I was still within the warranty period. I called for help with my problem, and I was pleasantly surprised by the high level of customer service that I received. The wait on the phone was minimal. The customer service agent was knowledgeable. They sent replacement parts via overnight delivery. I will not hesitate in the future to purchase the expensive extended warranty for my computer. However, this got me thinking. What if I never had to call for service? I wouldn’t have experienced the excellent customer service and concern that the company offers. They would be invisible. When it came time to purchase another computer, I might have considered going with a different brand.

Another good example of invisible customer service is a health insurance company. Let’s say that you have an individual insurance plan. As long as you are in good health, the main interaction that you will have with the health insurance company is paying the scheduled premiums. You probably couldn’t say whether the company offers good customer service or not. However, if you become sick and need to take advantage of the insurance that you have been faithfully paying for, that’s when you will find out what kind of service they offer. Is it easy to file a claim? Is the claim paid quickly? The experience will tell if you made a good decision when you chose the company, but until you make a claim, you’ll never know.

Companies, however, can escape the realm of invisible customer service. I recently had the pleasure of working with AvMed, a Florida-based health insurance company. They have great concern for their members and it shows in their customer-focused practices. They don’t wait until someone files a claim to show that they care about that member’s health. They pick up the phone and call the customers. They convey information not only about how to take advantage of the services they offer, but also ways the customer can stay healthy and save money. They don’t let their customer service be invisible. Their members don’t have to wonder if they made the right choice.

There is a lesson here for any kind of business. Even if you deliver amazing customer service every day, there may be times that you need to remind your customers. Think about after the sale or between visits, appointments, etc. You want your customers to know that they made the right choice by doing business with you and to think of you the next time they are in the market for the same product or service. Figure out what you need to do to keep your customer service from becoming invisible.

 

Did you like this post? To learn more about great customer service order a copy of Shep’s new book today! Amaze Every Customer Every Time: 52 Tools for Delivering the Most Amazing Customer Service on the Planet

Servitization and Revenue Maximization

The Basics That You Must Master

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One of the first consulting projects that I worked on was for Johnson Controls, Inc. (JCI). Our firm was brought in the mid-1980’s’ to help this company develop a service business strategy. A new strategy was required as result of the company’s decision to create one service organization to service all the building equipment sold by JCI. Up until this time, each equipment division operated its own service organization.

The new service organization was structured as a strategic line of business. The management team was given responsibility for generating and managing service revenue. Prior to the creation of the new line of business, the service organizations within JCI did not have to worry too much about revenue. Basically they had a captive market since the product divisions were responsible for selling service contracts and installation projects along with the products they sold. The new organization was now tasked with the responsibility of marketing and selling services directly to the end-users. This was an entirely new concept for the management team of the new business because they could now offer services to any company regardless of whether or not they owned JCI equipment.

The management team came to us for help with developing a go to market strategy and business plan. More specifically, they needed to become crystal clear with respect to their market, their service offering, and pricing approach if they were going to succeed in building a service business. One of their biggest challenges was determining the size of their market. It was foresighted of them to want to know about the size of their market because they’ve gone on to become one of the largest service organizations to the building industry, and certainly a company that is far along the path toward Servitization. I’ve met service executives who skip over this question about market size in their strategic planning process because they struggle with finding an answer. When asked if they know how large their market is, they give a vague answer likes “It’s big” or “the product market is X billion dollars so the service market is some portion of this”.

In order for the JCI executives to get a precise view of the size and growth of the market, we had to help them determine their total addressable market. This is where JCI’s foresightedness came into play. In defining the total addressable market, we helped JCI understand the market was not just equipment manufactured by JCI but equipment sold by other manufacturers. We also asked JCI to consider what else they could service in a building and what types of services they could offer. This led them to expanding their market focus to include a broad array of value-added services on a wide range of building technologies like fire and safety, security systems, and elevators. The definition did not stop there; it also took into account vertical market segmentation and other demographic factors like square footage and age of building.

As result of this strategic planning process, JCI had a comprehensive definition of their total addressable market (TAM). More importantly, they understood their service revenue opportunity on a very granular level; by technology, by service offering, and by vertical market. The work did not stop there. JCI still needed clarity around its Serviceable Available Market (SAM) and Serviceable Obtainable Market (SOM) or target market. In case you were wondering, SAM is the portion of the TAM that a company can reach taking into account various constraints like breadth of its sales channel and competitive factors. The SOM is the percentage of the SAM that a company can realistically capture based on various assumptions (e.g., sales effectiveness, operating capacity, resource allocations, etc.)

Without the diligence that went into defining the TAM, I don’t think that JCI would have grown into the service behemoth they are today. The level of diligence that went into defining the TAM established the foundation for the SAM and SOM. It also became the basis for them to eventually expand into service of Data Center, Energy Management System, and Security and Fire equipment. More importantly, JCI’s results proved that the more distinctions you can make about a market, the more precise your plans can be for penetrating it. The granularity around the TAM and SAM enabled JCI to ask the right strategic questions about what business they are in and what must happened in order for them to maximize market share.

The key takeaway here is that a service business must pay close attention to how it defines its market. It is not enough to simply say the market is “big” or reference market data from an industry analyst, and leave it at that. Companies who achieve outstanding results when it comes to service revenue growth are those who are able to methodically determine the size of their available, addressable, and obtainable market. This is absolutely critical for any company on the Servitization journey.

Innovate or Die

3 Strategies that will Transform your Service Business

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Recently someone asked me if service businesses face any fear when it comes to implementing new technologies or are they open to innovation. I had the think about this for minute and my answer is yes, they do face fear. Sure, a lot of business executives appreciate how important innovation is to the success of their company. However, few really step up and make change. Many more just talk about it or are forever planning to do it. This is fear rearing its ugly head.

Ridiculous you might say. Businesses are supposed to think rationally. How could a competent business let emotions get in the way? The answer is simple…businesses are run by people, people are only human, and fear is part of being human. In fact, business people have an uncanny way of expressing their fears as though they are rational objections. Here are just a few examples of typical objections that I have heard leaders give over then last twenty years for not adopting new technologies and the emotional sub-text (i.e., fear) about what they are really thinking:

Objection: Technology will not be able to do as good a job as me or my people
Fear: I will be replaced by a machine

Objection: Our Company is not ready for this new technology
Fear: People will resist my suggestion and I don’t want to risk my job over it

Objection: We tried something like this before and it didn’t work
Fear: I’ll be ridiculed for suggesting this idea. The last guy that tried to do this failed at it and lost his job.

Objection: This new technology is just hype. I can’t see it working for us.
Fear: I am really uncertain if we’ll be able to implement this effectively and don’t want to be the guy that failed, and lost his job because of it.

Objection: We can’t afford it. It’s not in the budget.
Fear: This could personally hurt me (us) financially this year (i.e. no bonus).

So what can leaders do to overcome their own fears? Tony Robbins, the great motivational speaker and self-help author offers three strategies:

1. Find something you are more scared of: Sure the fear of making a mistake about adopting new technology can be paralyzing but lost customers, increased operating costs, service inefficiencies and quality issues can be even more devastating.

2. Visualize what the future will be like: Imagine yourself and your company 3 or 5 years in the future. What will your future look like if you don’t make the change today? What impact will it have on market share, customer experience, or profits? If your answer is that things will be worse, much worse, then you will probably make the investment in the new technology.

3. Get Passionate about it: You can do this by defining all the reasons why you want to make a change and then make the change an absolute must.

Each one of these strategies has something in common. They require a leader to analyze their current situation and understand the implications of doing nothing versus the benefits of doing something. It also requires the leader have a well-defined plan for the future, and that he/she works diligently to carry out that plan. Remember that fear is acronym for False Evidence Appearing Real. Therefore the more supporting evidence you have that your plans are attainable, the more certain you will be at achieving it.

Let me know what you think of this post by sharing your comments below. If you believe you need more supporting evidence to pursue innovation in your service business then let’s schedule a FREE strategy session today. Last but not least, check out my new e-book titled “Unlocking value you within your service supply chain” for more suggestions on how to innovate and grow your service business.