High Performance Marketing
Conference 2012
High Performance Marketing
Conference 2012



Agenda
•   Customer Care legacy
•   The momentum to change
•   Service transformation
•   Co-sourcing
•   Results
High Performance Marketing
Conference 2012



Customer Care
•   Passenger & baggage complaints
•   Compensation and claims
•   Last resort of help
•   Various incoming channels
•   Marketing Function
•   Value driver: Repurchase intention
High Performance Marketing
Conference 2012



The Challenge



                                                     KLM Customer
                                                         Care


    Customer      Customer Power /   Unforeseen    Non-scalable supply
   Expectations    EU Regulations      Events       Informal control
                                     (e.g. Snow)
High Performance Marketing
Conference 2012



The Event That Changed Everything
High Performance Marketing
Conference 2012



The Pain
• 13.000 files in backlog, over 3 months waiting time
• Continuous escalations to board of directors
• Accenture Business Solutions stepped in ...
High Performance Marketing
Conference 2012



Visit to Ageas Millenium BCP
High Performance Marketing
Conference 2012



The Former State of Business
High Performance Marketing
Conference 2012



The Ambition
                   Innovative      Predict customer behavior:
                                    • Identify potential service issues & inform clients pro-actively
                    Customer
+                    Insight        • Provide a differentiated service for the customer
                    Excellence      • Align compensation provided to customer expectations


                    Advanced       Incidents proactively managed:
                     Customer       • Core processes proactively managed
                      Centric
                                    • Service KPI driven, continuous improvement
                   + Operational
                     Excellence     • Moderate Customer Insight


                      Basic        Customer recovery & loyalty focus:
                    Customer       • Claims management operational excellence
                       Care
                                   • Solution robustness facilitates scalability
                    Excellence
                                   • Moderate continuous improvement

                     Today         Service informal, non-customer centric:
                                   • Lack of insight into drivers, metrics, use of customer insight
                     Informal
-                                  • Reactive, defensive, strict service, strong focus on policy
High Performance Marketing
Conference 2012



The Vision
“KLM Customer Care consistently delivers an excellent service
  experience to ensure customer recovery.
We are accessible, recognize and trust our customers, are
  attentive to their needs and are empowered and motivated to
  offer them the most relevant solution – at all times and at
  their convenience.
We appreciate their feedback as it enables us to improve our
  service.”
High Performance Marketing
 Conference 2012




                                                                                Horizon IV
   Consistent




                                                                         Customer insight excellence
                             Horizon III Customer
                              centric operational
                                  excellence
                                                      Organization
                                                                                       The
Service excellence




                         Horizon II
                        Build a solid
                        foundation                                                    vision
                                                            Process
                                                          optimization     Enabling
                                                                              IT               Performance
                                                                                               management
                                                                                                (‘rhythm of
                                         Horizon I                                                success’)
                                        Stabilize &
                                        short term
                                          impact
  Random




                     CCNL 2010


                     Basic, informal           Customer care maturity           Q1-2011        ~ 2011         ~ 2012 - 2013   ~ 2014
High Performance Marketing
 Conference 2012


Key Performance Indicators
                 Effective customer                Efficient
                      Recovery              & with engaged people
  Finance




                      Maximize                                                Reduce
                        ROI                                                  cost/claim
  Customer




                   Ensure happy                      Maximize
                    customers                       accessibility


               Ensure                                                 Ensure
  Process




                             Meet service      Maximize                               Maintain
              effective                                              efficient
                              standards     responsiveness                            Hygiene
             resolution                                             resourcing
  Humans




                       Ensure
                    engaged staff
High Performance Marketing
Conference 2012



The Key Building Blocks


                                      Process


                      Organisation




                        Rhythm


                                     Enabling IT
                          of


                        Success
High Performance Marketing
Conference 2012



Impact of the Change
        1                                                        16
                                     9
             Optimize web form               Core IT upgrade          Forecasting/ planning

        2                                                        17
                                     11
            Increase accessibility           Fraud detection           Quality Assurance

        4                            12                          18
            Quick reference cards               Employee                  Operational
                   intake                   performance mgt             performance mgt
        7                            14                          19

             Segmentation grid            Behavior/ engagement              Sourcing

        8                            15
                                           New organization/
            Core process re design
                                                 roles
High Performance Marketing
Conference 2012



Segmentation Grid
          WHO                                                  WHAT


          FB TIER         SOORT CASE               CASE TYPE            CASE GEVOELIGHEID   CASE COMPLEXITEIT




White wing              Vraag          Bagage                     N/A

Offline                 Compliment     Airport                    Directie

Ivory                   Claim          After-journey              Escalatie
                                                                                               Multiple
Silver                  Klacht         Delay                      Mediagevoelig

Gold                                   In-flight                  Schrijnend

Platinum                               Pre-journey                Medisch / Injury




                    < 20 = General
                    ≥ 20 = High-value
                                                                                                                15
High Performance Marketing
    Conference 2012



Process Design

                       INTAKE                PROCESSING              FULFILLMENT
      CORE




A                                          HIGH-VALUE
                                            HANDLING
                                                        OUTBOUND
                                                         CONTACT
                                                                     Payment
                                                                   Preparations
      NON-CORE




                             Enrichment
                                            GENERAL
B                Scanning   Segmentation
                              Allocation   HANDLING
                                                        OUTBOUND
                                                         CONTACT
                                                                                  NON CASH
                                                                                   ITEMS
High Performance Marketing
Conference 2012



Co-sourcing with Accenture
•   Flexible, inhouse sourcing
•   Energetic & professional
•   Cost per claim contracting
•   Improvement incentive
•   Forecasting is essential
High Performance Marketing
Conference 2012



The Results
•   80% of all claims handled within 24 hours
•   8% increase in repurchase intention
•   50% productivity improvement
•   Major increase staff happiness and pride!
•   Continuous improvement in place
High Performance Marketing
Conference 2012



Lessons Learned
•   Change requires pain and momentum
•   Big hairy audacious goals set the right scene
•   Outsourcing is not about black or white
•   Customer value can be found nearby
High Performance Marketing
Conference 2012

HPMC12: KLM Customer Care presentation

  • 1.
  • 2.
    High Performance Marketing Conference2012 Agenda • Customer Care legacy • The momentum to change • Service transformation • Co-sourcing • Results
  • 3.
    High Performance Marketing Conference2012 Customer Care • Passenger & baggage complaints • Compensation and claims • Last resort of help • Various incoming channels • Marketing Function • Value driver: Repurchase intention
  • 4.
    High Performance Marketing Conference2012 The Challenge KLM Customer Care Customer Customer Power / Unforeseen Non-scalable supply Expectations EU Regulations Events Informal control (e.g. Snow)
  • 5.
    High Performance Marketing Conference2012 The Event That Changed Everything
  • 6.
    High Performance Marketing Conference2012 The Pain • 13.000 files in backlog, over 3 months waiting time • Continuous escalations to board of directors • Accenture Business Solutions stepped in ...
  • 7.
    High Performance Marketing Conference2012 Visit to Ageas Millenium BCP
  • 8.
    High Performance Marketing Conference2012 The Former State of Business
  • 9.
    High Performance Marketing Conference2012 The Ambition Innovative Predict customer behavior: • Identify potential service issues & inform clients pro-actively Customer + Insight • Provide a differentiated service for the customer Excellence • Align compensation provided to customer expectations Advanced Incidents proactively managed: Customer • Core processes proactively managed Centric • Service KPI driven, continuous improvement + Operational Excellence • Moderate Customer Insight Basic Customer recovery & loyalty focus: Customer • Claims management operational excellence Care • Solution robustness facilitates scalability Excellence • Moderate continuous improvement Today Service informal, non-customer centric: • Lack of insight into drivers, metrics, use of customer insight Informal - • Reactive, defensive, strict service, strong focus on policy
  • 10.
    High Performance Marketing Conference2012 The Vision “KLM Customer Care consistently delivers an excellent service experience to ensure customer recovery. We are accessible, recognize and trust our customers, are attentive to their needs and are empowered and motivated to offer them the most relevant solution – at all times and at their convenience. We appreciate their feedback as it enables us to improve our service.”
  • 11.
    High Performance Marketing Conference 2012 Horizon IV Consistent Customer insight excellence Horizon III Customer centric operational excellence Organization The Service excellence Horizon II Build a solid foundation vision Process optimization Enabling IT Performance management (‘rhythm of Horizon I success’) Stabilize & short term impact Random CCNL 2010 Basic, informal Customer care maturity Q1-2011 ~ 2011 ~ 2012 - 2013 ~ 2014
  • 12.
    High Performance Marketing Conference 2012 Key Performance Indicators Effective customer Efficient Recovery & with engaged people Finance Maximize Reduce ROI cost/claim Customer Ensure happy Maximize customers accessibility Ensure Ensure Process Meet service Maximize Maintain effective efficient standards responsiveness Hygiene resolution resourcing Humans Ensure engaged staff
  • 13.
    High Performance Marketing Conference2012 The Key Building Blocks Process Organisation Rhythm Enabling IT of Success
  • 14.
    High Performance Marketing Conference2012 Impact of the Change 1 16 9 Optimize web form Core IT upgrade Forecasting/ planning 2 17 11 Increase accessibility Fraud detection Quality Assurance 4 12 18 Quick reference cards Employee Operational intake performance mgt performance mgt 7 14 19 Segmentation grid Behavior/ engagement Sourcing 8 15 New organization/ Core process re design roles
  • 15.
    High Performance Marketing Conference2012 Segmentation Grid WHO WHAT FB TIER SOORT CASE CASE TYPE CASE GEVOELIGHEID CASE COMPLEXITEIT White wing Vraag Bagage N/A Offline Compliment Airport Directie Ivory Claim After-journey Escalatie Multiple Silver Klacht Delay Mediagevoelig Gold In-flight Schrijnend Platinum Pre-journey Medisch / Injury < 20 = General ≥ 20 = High-value 15
  • 16.
    High Performance Marketing Conference 2012 Process Design INTAKE PROCESSING FULFILLMENT CORE A HIGH-VALUE HANDLING OUTBOUND CONTACT Payment Preparations NON-CORE Enrichment GENERAL B Scanning Segmentation Allocation HANDLING OUTBOUND CONTACT NON CASH ITEMS
  • 17.
    High Performance Marketing Conference2012 Co-sourcing with Accenture • Flexible, inhouse sourcing • Energetic & professional • Cost per claim contracting • Improvement incentive • Forecasting is essential
  • 18.
    High Performance Marketing Conference2012 The Results • 80% of all claims handled within 24 hours • 8% increase in repurchase intention • 50% productivity improvement • Major increase staff happiness and pride! • Continuous improvement in place
  • 19.
    High Performance Marketing Conference2012 Lessons Learned • Change requires pain and momentum • Big hairy audacious goals set the right scene • Outsourcing is not about black or white • Customer value can be found nearby
  • 20.