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Fs forum june 2010
- 1. Our business delivers Intellectual Capital Measurement Action for Customer Experience What’s the Big Idea? Jamie Lywood CEO – Harding &Yorke EMPATHY - So what is empathy?
- 2. - FEELINGS -So what is empathy? EM The Greek - PATHEA - Feelings Wikipedia “Is the capability to share another being’s emotions and feelings as if they were your own” and then do something about it!
- 4. Existing Customer? New Customer? 80% 20% Tom Peters: “Every Board should have a ten year old on it!” Lie Manipulate Play Politics “Because you Promised !” GURU 2 8 The Retailer’s Dilemma
- 5. The Traditional Approachto Customer Service Harding & Yorke Matrix The HYM Sheet
- 6. FFAAIILL SSUUCCCCEEEEDD TTHHEEWWAAYY YYOOUU DDOO IITT!! PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E WWHHAATT YYOOUU DDOO!!
- 7. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 8. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 9. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 10. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 11. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 12. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 13. FFAAIILL SSUUCCCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 14. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 15. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 16. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 17. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 18. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 19. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 20. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 21. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 22. ?? FFAAIILL SSUUCCCCEEEEDDEEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 23. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 24. FFAAIILL SSUUCCCCEEEEDD EEXXCCEEEEDD EEM MP PA AT T HH YY PPL LE EA AS SA AN N TT AAL L II EE NNA AT TE E Traditional Customer Satisfaction TTHHEE WWAAYY YYOOUU DDOO IITT!! WWHHAATT YYOOUU DDOO!!
- 25. Can we measureEmpathy? •High Ratio •Statistically Significant •Easily Segmented •Comparable •Highly Focussed •Validated •Easily Actionable A A better typical approach approach to Customer Centricity
- 26. PHYSICAL & EMOTIONAL Can we measure Empathy? Face to face Web Email, SMS Mail, Fax, etc Have: Needs / Wants / Problems EMPATHY SURVEY CUSTOMERS CUSTOMERS RESPOND VALIDATE Marketing / Awareness Communication Satisfies: Needs / Wants / Problems Meet Physical needs well Poor Emotional understanding Based on: •Logic •Expectation •In the moment •Outcome •Knowledge Missing: •Emotion •How it feels •Relationship •Moment of Truth FEED BACK RECOMMEND IMPLEMENT AN AL YS E Voice ANALYSE EMPATHY - PHYSICAL EMOTIONAL
- 27. How we feel Feel Gut Feeling Empathy
- 28. Willing Happy Warm Friendly How they feel Respond EEmmoottiioonnaall RReessppoonnssee How we feel Feel EEmmppaatthhyy Gut Feeling
- 29. Volume Willing Clarity Tone Pace Happy Warm Friendly How it’s said / written Voice / Text Qualities How they feel Emotional Response How we feel Listen / Read Respond Feel Empathy Gut Feeling
- 30. Content Volume Willing Happy Words Facts Clarity Language Tone Pace Warm Friendly Quantitative Attention Hear what’s said How it’s said Voice / Text Qualities How they feel Emotional Response How we feel Hear / Re-read Listen / Read Respond Feel Empathy Gut Feeling
- 31. Content Volume Willing Happy Words Facts Clarity Language Tone Pace Warm Friendly Quantitative Attention Hear what’s said How it’s said Voice / Text Qualities How they feel Emotional Response How we feel Hear / Re-read Listen / Read Respond Feel Gut Feeling Empathy Go directly to the Gut Feeling
- 32. 40 35 30 % 25 20 15 10 5 0 How welcomed do I feel by the initial words of the Greeting? CCoouullddnn’’tt FFeeeell WWoorrssee FFeeeellss BBaadd NNeeuuttrraall FFeeeellss GGoooodd EExxttrreemmee DDiissssaattiissffaaccttiioonn DDiissssaattiissffaaccttiioonn NNeeuuttrraall SSaattiissffaaccttiioonn CCoouullddnn’’EExxttrreemmee tt FFeeeell SSaattiissffaaccttiioonn BBeetttteerr CCoouullddnn’’tt ffeeeell lleessss WWeellccoommeedd UUnnwweellccoommeedd WWeellccoommeedd CCoouullddnn’’tt ffeeeell mmoorree WWeellccoommeedd 11 22 33 44 55 66 77 88 99 1100 Average 5.7
- 33. COMMON VALUES DEVELOPINGTHE RELATIONSHIP HANDLING THE TASK Overall SUB-CONSCIOUS IMPRESSION Overall CONSCIOUS IMPRESSIO N WRAP UP FACTS AND FEELINGS PROMOTION / RETENTION Can we measure Empathy?
- 34. 66..0022 88..22 Howyou make us ‘Feel’ How you ‘Process’ us The Importance of Empathy Alliance & Leicester (4) Aviva (3) AXA (1) Barclays (4) Bradford & Bingley (1) Churchill (2) Direct line (3) HBoS (7) ING Direct (3) Lloyds TSB (4) MBNA (1) NatWest (4) Post Office (1) RAC (1) RBS (5) RBS Insurance (1) Sainsbury’s (6) Santander (Abbey) (5) Scottish Widows (1) Standard life (3) Virgin Money (2)
- 35. The Importance ofEmpathy Prof. Merlin Stone Dr. Yuksel Ekinci Financial business performance indicators downloaded from the AMEDEUS database Empathy ratings downloaded from Harding & Yorke Univariate & multivariate statistical techniques used for assessing validity and reliability of ERIC. These included: Linear Correlations Exploratory Factor Analysis (EFA) Multiple Regression (Ordinary Least Squares) Cronbach’s Alpha (Reliability) Another GURU A man with a very high forehead
- 36. Key Findings: Process: •No correlation with profit •4 dimensional Empathy: •Very strong correlation with Return on Capital Employed at .85 •Uni-dimensional Reliability: •98.9% reliable 0.32 0.55 0.75 1.0 NONE WEAK GOOD STRONG STRENGTH OF CORRELATION The Importance of Empathy
- 37. The Importance ofEmpathy ++ -- ££//$$ RR EE TT UU RR NN 11 22 33 44 55 66 77 88 99 1100 first direct Virgin RBS Standard Life Etc. CCoommmmiittmmeenntt // IInnvveessttmmeenntt 2004
- 38. Conclusion: For everypoint increase on the Empathy index, there will be 16.4 % improvement on ROCE. 11 22 33 44 55 66 77 88 99 1100 100% 80% 60% 40% 20% 0% -20% -40% -60% -80% -100% · · · · · · · · · ££//$$ RR OO CC EE EEMMPPAATTHHYY The Importance of Empathy
- 39. The Importance ofEmpathy Positive Moment of Truth Negative Moment of Truth Increased value of products purchased at Bank 58% Purchased new product 29% Perception of bank improved but did nothing 13% Bought product at another Bank 23% Switched main Bank Stopped Product 20% 15% Decreased Value of products 14% Perception of Bank worsened but did nothing 28% Source: McKinsey
- 40. Advocacy Measures e.g.NPS Chronology Advanced Predictive Analysis - Benchmarking e.g. ACSI ‘Profit’ - Prof. Merlin Stone ‘Revenue Growth’ - Fred Reichheld ‘Stakeholder Value’ – Claus Fornell The Importance of Customers recognised e.g. Customer Satisfaction 1983
- 41. Credit Cards -Apr’09 Health Insurance - Oct’09 Home Insurance - Jul’09 Life Insurance - Jun’09 Loans – Jul’09 5 6 7 8 9 10 P Low 7.85 Average 8.31 High 8.71 Low 7.39 Average 8.43 High 8.82 Low 7.66 High Mortgages - Feb’09 Low 5.86 Av. 6.23 High 6.69 Motor Insurance- Feb’09 Savings - May’09 Telephone Banking - Mar’10 Mobile Phone - Mar’09 Low 5.43 Average 6.04 High 6.65 Low 5.92 Av 6.39 High 6.77 Low 5.93 Av. 6.29 High 6.53 Low 6.26 Average 6.42 High 6.83 Low 5.61 Average 6.03 High 6.44 Low 5.75 Average 6.28 High 6.58 Low 5.69 Average 6.19 High 6.49 Low 5.94 Average 6.16 High 6.4 Low 5.83 Average 6.29 High 6.73 Catalogue Clothing - Dec’08 Low 5.69 Average 6.18 High 6.75 Low 8.29 Average 8.59 High 9.01 Low 8.21 Average 8.59 High 9.00 8.56 Average 8.15 Low 7.28 Average 8.23 High 8.51 Low 7.76 Average 8.45 High 8.96 Low 7.93 Average 8.39 High 8.76 Low 7.86 Average 8.38 High 8.74 Low 7.55 Average 8.27 High 8.81 Low 6.72 Average 8.07 High 8.61 E MP AT HY R OCESS OPP ORT UNI T Y 6.5+ Makes u7s .F5+E EAL ‘ g‘goooodd’ ’PROCESS
- 42. Bank Branch Scores NatWest has done particularly well in efforts to attain a high and consistent score within their Branch Network. Lloyds Banking Group (Lloyds TSB & Halifax) stand out through their inconsistency by having both the lowest and highest scores.
- 43. Contact Centre Banking– Over Time Data is taken from H&Y’s ERIC™ competitor benchmarking programme (Telephone Banking - Sales) Lloyds TSB HSBC HBoS Nationwide Alliance & Leicester First Direct RBS Barclays First Direct HBoS Barclays Lloyds TSB HSBC Nationwide NatWest NatWest Alliance & Leicester RBS
- 44. The Versatility ofEmpathy Telephony Physical Retail / Meetings / Interviews / Home visits etc. Web / Mobile Digital / Television / Email etc. Self Service Inbound/outbound / IVR / ISR / Auto messages etc. ATM’s / Handsets / Posters / Environments etc. COMPETITION
- 45. Dare to beSome ideas Dto ieffxeprelonrt e– The Ritz Carlton
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- 49. Key messages totake away Direct and academically proven correlation with PROFIT (ROCE) Proposition appeals to highest Execs, but is also practical and supportable throughout organisations and unions Empathy is evidence based measurement for all offline and online channels and provides clear recommendations for action Valid, Reliable and Sensitive data supported by proven solutions for improvement – not-dependent on consultancies! Enables built-in measurement and proof of progress and can be integrated with internal Quality Performance Measures Outputs are comparable through industries, channels, functions and across borders Common Sense!
- 51. Our business delivers Intellectual Capital Measurement Action for Customer Experience What’s the Big Idea? Jamie Lywood CEO – Harding &Yorke JL@empathy.co.uk +44 (0)7850 20 20 30 EMPATHY - Is it!
Editor's Notes
- #28 The first thing – our first response to any stimulus is a GUT FEELING. A moment such as a certain look or a change in tone or voice or a pause which is just a little too long gives us a feeling (example).
- #29 The next level of response is to do with the mood signified by this stimulus. So you begin to aticulate how the other person is feeling and how it makes you feel – and you will use words such as HAPPY, FRIENDLY, WARM etc. These are the sort of words that are labelled SUBJECTIVE and people imagine that they are almost impossible to measure in any rational way. But we have already begun to measure it from the moment we had our gut response.
- #30 The next level is going to look like a more familiar judgement on the way they said what they said – Terms more familiar in terms of reviewing performance – words like Clarity – Tone – Pace. This is beginning to bridge the gap between these voice qualities and something that we can quantify and that is the last level which includes the actual words spoken – the content, the script if you like. If you start at this outer edge you’re missing the fundamental aspects of the customer experience -
- #31 The next level is going to look like a more familiar judgement on the way they said what they said – Terms more familiar in terms of reviewing performance – words like Clarity – Tone – Pace.
- #32 This is beginning to bridge the gap between these voice qualities and something that we can quantify and that is the last level which includes the actual words spoken – the content, the script if you like. If you start at this outer edge you’re missing the fundamental aspects of the customer experience -
- #51 Empathy doesn’t always have to cost us time. Empathetic interactions are more efficient: agents listen and understand us ‘the customer’ better and quicker, they can explain more effectively and in the right manner, they can also find the best solution for both the customer and company. It is all about giving people an individual service. Mirroring the customers style, understanding their emotional needs as well as physical, its about making the customer feel good about themselves and us. Empathy is not about being pink and fluffy or ‘lovey dovey’ as this will turn most of us off.