The document discusses service excellence and customer relationships. It begins with an introduction to Symbia, a management consulting firm. It then discusses the importance of understanding customer needs, wants and sources of value. Several activities are presented for attendees to discuss their organization's customer touchpoints, barriers to service excellence, and goals for improvement. Customer retention is highlighted as being more profitable than attracting new customers. The document emphasizes that service excellence requires having the right people, processes, and an overall customer-focused culture.

1. 1
Service Excellence – the key to Customer
Retention
25 October 2005
Royal Commonwealth Society
London
“London Excellence”
Dr. Ted Marra
Strategic Partner, Symbia

2. 2
Symbia – who we are
 Founded in 1994 as an independent professional services company
» Management consulting
» Interim Management
» Technical Services
 Primary areas of expertise
» Customer Relationship Management (B2B)
» Performance Management
» Procurement
 S-Cat prime contractor for Business & Management Consultancy
 Working across public and private sector

3. 3
Who we deliver to: Some of our clients

4. 4
 Who you are
 Where you are from
 Why you are here
Very Short Introductions

5. 5
Group Activity
 At your tables, share with your colleagues what you believe best
describes your senior management’s beliefs or attitudes about service
in your organisation
 Group discussion

6. 6
Attitude
about
the job
Attitude
about
the company
Employee
behaviour
Merchandise
Value
Service
Helpfulness
Customer
impression
Customer
recommendations
Employee
retention
Customer
retention
Return on assets
Operating margin
Revenue growth
A COMPELLING PLACE
TO WORK
A COMPELLING
PLACE
TO INVEST
A COMPELLING
PLACE TO SHOP
5 UNIT INCREASE
IN EMPLOYEE
ATTITUDE
1.3 UNIT INCREASE
IN CUSTOMER
IMPRESSION
0.5% INCREASE
IN REVENUE
GROWTH
DRIVES DRIVES
The service-profit chain at Sears

7. 7
Service Excellence Basic Model
Service
Excellence
Recovery Stronger
Relationships
Prevention
+
Understand
Assess
Negotiate
Be an
Advocate
Prepare
Listen & Learn
Be a
Resource
Be an
Advocate
Apply
Quality
Techniques
The Systematic
Cycles of Customer
Engagement

8. 8
Customer Relationship
Strategies
Customer “Sensing”
Processes
Vision, Business Plan and Key Business Objectives
CRM
Customers
Touch
Points
• Sales
•Delivery
•Service
•Others
CustomerFocusedCulture
Feedback
The Customer System of an Organisation

9. 9
Managing the Customer Relationship:
Customer Experience and Touch Points (B2B)
Sales Process Delivery
Customer
Purchase
Decision
Customer
Purchase
Consideration
System Design
Installation Repair Service / Maintenance
First
Invoice
Order
Submission
Credit
Review
Purchase Cycle
Customer
Purchase
Consideration
Training Technical Support
Account Maintenance
“Telecommunications”

10. 10
Group Activity
 At your tables, identify the moments of truth or touch points that occur
between your customers and your organisation
» Identify the ones where you believe your organisation delivers its
best service
» Identify the ones where you customers would say they
experience the most pain (highest level of difficulty)
 Share these with those at your table
 Group discussion

11. 11
The Two Costs of Doing Business
 Whenever a customer comes to do business with your organisation
they always incur two costs. What are they?
1. E_________
2. E_________

12. 12
Behavioural Research Data
 Poor service loses customers
» Problem Experience Impacts Customer Loyalty:
 Before the problem 70%-95% and 40%-75% after a problem.
 So what is your recovery capability?
» Nearly 67% of the time, the reason a customer reduces or stops doing
business with you and goes to a competitor is because of poor service
(B2C)
» Nearly 70% of the time, business to business customers stop doing
business or reduce purchases is that they perceive your organisation is
“not easy to do business with” (B2B)
 “It costs six to twenty times as much to get a new customer as it does to keep
an existing one”

13. 13
A “Best Practice” Complaint and Enquiry Management
Process
Customer
Initiation
Contact
Process
Fulfillment
Process
Validation
Process
Management
Process
Escalation
Process
Closed Loop
The Recovery System

14. 14
Mean
7.96
Problem
experienced?
No
774
Yes
338
Satisfaction Index TM
Next financial product or
service
1112
Customers answered
the question
Complaint
registered?
No
103
74.7%
Not satisfied
123
Satisfied with complaint
handling?
Satisfied – scores of 7 to 10
Dissatisfied – scores of 1 to 4
Yes
235
Satisfied
112
64.7%
54.9%
Mean
6.86
Mean
5.47
Mean
3.46
83.4%
Recovery Process for Bank X

15. 15
 Understanding your customers
o Basic needs
o Wants
o Sources of value

A Critical Success Factor for Achieving Service
Excellence

16. 16
 Value should be measured in terms of “benefits” perceived by the customer
» Image/reputation/brand strength
» Process
» People
» Product
» Service
» Technology
» Support

The Seven Sources of Value

17. 17
Group Activity
 At your tables, identify the following
» The 2 most important basic needs of your customers
» The item you believe would be at the top of your customer’s
“wish list”
» One key way you could add more value in your customer
relationships
 Share these with those at your table
 Group discussion

18. 18
Group Activity
 At your tables, identify the following
» The three most critical components of service excellence – the
ones which form the base capability of an organisation to be able
to deliver excellent service consistently
 Discuss them briefly with those at your table
 Group discussion

19. 19
Service Excellence
Characteristics/Scope
Benefits
Innovation
Service
Excellence
People
Process
Service
Easy to do business (simple)
Responsive/Short cycle time
Knowledge
Skills
Behaviours
Attitudes
Capability
HR Systems
Alignment

20. 20
Loyalty is the state in which the
desired set of customer needs, wants
and benefits are provided throughout
the business relationship resulting
in being the preferred and
recommended supplier in all
relevant product
and service areas

21. 21
The Loyalty Hierarchy
Indifferent
Satisfied
Loyal
Secure
Increasingly“Benefits”Driven
Increasingly“Price”Driven
Differentiation
from
Competition
Through Value
LOWER
PROFITABILITY
HIGHER
PROFITABILITY
To be successful, your organisation must identify the customers
it wants, attract them and keep them through building
relationships based upon an appropriate value proposition

22. 22
Group Activity
 At your tables, discuss the following
» What should be your organisation’s action plan for change if it is
serious about achieving service excellence? That is, what do
you have to do or do differently to achieve service excellence?
» What are the barriers and how do you overcome them?
 Group discussion

23. 23
Questions?

24. 24
Adjourn and Thank You!

25. 25
Reference Materials

26. 26
Possible Attitudes or Beliefs of Management
Regarding Service (see journal article)
 Service is viewed as a cost – not in terms of benefits
 Oh, but at least we’re the “best of a bad lot”
 Excellent service is a “nice to have”
 They don’t see that poor service will cost far more in the end than their
investment in achieving excellent service
 Lack of education of management e.g., the service-profit chain
 Service is viewed as operational – not strategic
 Customer satisfaction measurement often does not include anything
other than the basic needs of customers – and not touching on their
wants or value adds
 Customer service management are sometimes viewed as second
class citizens

27. 27
Model of Organisational Performance
Employee
Orientation
Customer Focus
Excellence
Work Environment/Values
Attitudes
Behaviors
Organisational Performance
Continuous Improvement
Desired Outcomes:
• Customer Retention
• Employee Retention
• Financial Results
• Business Excellence
Employee Performance
(“Excellence”)
Employee Mindset
(“Paradigms”)
Critical Success
Factors
(“Drivers”)

28. 28
Behavioural Research Data
 In a business to business environment, you usually do not know there
is a problem until it is too late!
 Those customers who do not complain are your least loyal, yet easiest
and least costly to retain.
» You must find a way to invite them to speak with you about their
issue

29. 29
The Tip of the Iceberg
5%
60%
35%
Complain to
Field Level/
District/Sales Office/
Plant/Mill/Chain Partner
Encounter a
problem, but
do not
complain
No News is not necessarily good News!
65%
30%
to 50%
Call
Centre
Why do some people
NOT complain?
Complain to
Head Office

30. 30
Defining “Basic” Needs
 Areas where you must be routinely flawless in delivery (six sigma!)
 Failure on a “basic need” results in:
» Disproportionately high levels of dissatisfaction
» Recurring problems of a “basic” nature can quickly lead to customer
disengagement
 Customers tend to be more less tolerant to perceived gaps between your performance
and that of a competitor on “basic needs”

31. 31
Defining “Wants”
 The true “wants” of the customer go to the next level above “needs”.
 Meeting “wants” usually results in satisfying the customer or
even delighting them
» It may or may not ensure loyalty
 Customers easily articulate their needs
» Determining “wants” requires more effort
 You must tap into the customer’s “wish list”

32. 32
Defining Value
 Value is an intangible or tangible benefit which the customer
perceives that the competition is either unwilling or unable to provide.
It is a true source of differentiation & competitive advantage
 Pre-requisite: “routinely perfect in delivering on the basic needs” (zero
defects)

33. 33
Service Excellence: People
The People Component
Customer Touch Points with
Your Organisation
People & Process
Value Delivery
Value
Creation
People Capability
Attitudes
Behaviours
Knowledge
Skill
Support
(including
alignment of
HR Systems)
Business Strategy
Flow
to the
Customer