Chapter 11   Customer
Chapter 11   service
Chapter 11   

Chapter 11 is concerned with how the needs of customers are identified and assessed, not so much in the sense of the products or the goods and services which they require, but the ways in which those products are provided, delivered and subsequently supported by the people involved in the organization. Customer service is about formulating and implementing policies and standards of behaviour and practice, which will ensure that customers’ needs are identified. It is also about developing procedures that ensure customers are treated politely, fairly and positively if things go wrong.

Invariably the customer service policy will overlap and reflect the sales and marketing plans and the quality policy of the business, as it does in effect define the way in which quality standards are implemented within the sales environment. The objectives of this chapter are to examine how to identify customer needs and expectations, and to define how they will be implemented and monitored. This chapter also relates to Unit A7 of the NVQ Level 3 Business Planning qualification, entitled ‘Establish a customer service policy’. This follows the same pattern of assessing customer needs, developing policies and procedures to meet those needs, and specifying how those policies will be implemented and monitored.

We have already examined the marketing context of identifying customer needs in the market research section of Chapter 9. The service aspects of customer needs can most effectively be determined by asking customers face to face, by telephone or by written questionnaire, whether the business is meeting the full range of their needs and expectations, where there are any gaps or shortfalls and how the customers would like to see those addressed.

Apart from the details and specifications of the products themselves, in most cases when we are talking about customer needs we are, in reality, talking about customer expectations. By this we mean what the customers expect from us as suppliers, and what the customers themselves perceive to be their needs, as opposed to what we believe them to be.

What do customers expect?

•   From the business: pleasant and suitable surroundings which are clean, welcoming, well-lit, safe and hygienic, and living up to the general image of the business and its products or services.

•   From the staff: sufficient staff to be available. Staff to show a friendly, interested and welcoming attitude, and to be pleasant and non-threatening. Staff should also be smart in appearance, competent and knowledgeable. Customers also expect that dealing with the organization's staff should be a pleasant experience, and free of problems, antagonism or excuses.

•   From the products, goods or services: these should be available when wanted, fit for the purpose for which they were acquired, and at a reasonable price which constitutes value for money. User-friendly information should be provided as to where the product can be found, and about its use and operation. The product should also be supported by a friendly, helpful and efficient after sales service in the event of any problems arising.

Why should we bother with customer service or customer care?

First, let us differentiate between the two. Customer service is often described as the way in which we respond to customers and their problems. In contrast, customer care goes a stage further in that a customer care policy (like a TQM policy) tries to build a policy of awareness and responsiveness to the customer within the provision of the product or service as a whole, and with the intention of avoiding possible problems at a later stage. Customer care is about minimizing the occurrences that are likely to give rise to complaint, and responding quickly and positively when complaints do occur. The primary objectives of customer care are to:

•   Retain customers for repeat business. The use of sales staff and advertising etc. to find new customers is an expensive process. If we can retain or at least reduce the rate of natural turnover of existing customers, then sales effort can be invested in finding extra new customers which overall will increase the sales revenues and profits of the business.

•   Increase the level of trade with existing customers by improving their confidence in the business and its products or services. Dealing with the business should constitute a pleasant and problem-free experience. This again will generate extra sales revenue and profit in the longer term.

•   Enhancing the reputation of the business and its quality standards. This is aimed at increasing customer loyalty and recommendation, which again adds to turnover and profit. Even customers who complain, but who are treated well in response, tend to return and to tell others about their positive experience. In contrast, poor service leads to loss of reputation and customers, and consequential reductions in turnover or the need for extra sales effort to replace lost trade

•   In the longer term, the implementation of customer care policies tends to reduce the costs of operations. As in the case of quality management described in the previous chapter, by building in quality systems it is possible to reduce the need for checking and inspection, leading to a reduction in the cost of quality control. Similarly, a good customer care policy tends to reduce the occurrence of problems and to correct them before they get out of hand. Customers who do not complain often go elsewhere anyway, so the idea is to avoid complaints arising in the first place, to prevent the loss of customers. Overall the process should result in a reduction of costs as the need for inspection and remedial action is reduced.

•   Within the business itself, a positive customer care policy should also have the effect of increasing job satisfaction of staff, both by the positive interaction with their customers, and by avoiding the stress and aggravation that accompany customer complaints. Once again, this should contribute to the overall efficiency of the business.

Customer expectations do not always relate to the object in question but to the potential benefits that object offers. People do not just go to restaurants for food; they go to spend a pleasant evening with friends in relaxed and convivial surroundings. Cars are not just sold on engine size, they are sold on the pleasure of driving in comfort, their reliability and economy, the exhilaration of speed and acceleration, and the image they convey. Think back to the Dexion salesman quoted in Chapter 9: ‘I sell solutions to problems, not storage or materials handling systems’. Similarly, within the sales transaction and subsequent interpersonal contact, customers do not just want efficiency, they need to be made to feel important and that their custom is valued, and to have esteem and respect from the sales staff even if it is just a one-off transaction. Most important of all, the attitude projected by staff must be perceived as being genuine; no matter how obnoxious the customer, given time the positive attitude may even rub off on them. Customers are a complex mixture of personality, emotions, motivations, attitudes and needs. The more that you understand their perspectives, the better you can meet those needs.

The implication of this is that the quality ethos and customer care attitude must be an inherent part of the internal culture of the business, which implies a high level of commitment on the part of the owners, to motivate their staff and to treat them in an equitable fashion. The bottom line is that you can hardly expect your staff to treat your customers with respect and to demonstrate commitment to customer care if behind the scenes you are treating the staff like dirt. Remember, Murphy's Third Law of Universal Cock-Ups states that if you treat your staff badly they will wreak revenge through your clients, and usually at a time and place where it is guaranteed to hurt you the most. Like charity, customer care starts at home.

How do we go about formulating a customer care policy?

As we have just said, the customer care attitude must become an inherent part of the culture of the business, and the policies which are developed must work towards that end. In larger organizations this normally takes place as part of an overall TQM strategy affecting all systems and operations, and relating to the internal customers as well as those in the external marketplace. In a new business the initial primary objective is usually that of survival and growth to a level of financial stability, and only once that stability has been achieved can the proprietors move further towards enhancing growth and profit using quality systems. The fact is that irrespective of any desire to employ quality systems, most new businesses do not have the time or resources to implement these in the early stages of their existence. However, once a basic level of stability is achieved, they are in a position to move from reactive to proactive methods of working, of which the introduction of customer care policies is an obvious choice and priority.

Probably the most important aspect of the customer care policy is that it should coincide with, and work towards meeting, the primary objectives or mission statement of the business. In fact most businesses which actively promote policies of customer service and customer care invariably end up including reference to those policies within their objectives, particularly in service industries where the process generates the profit. The mission statement might be something like: ‘The company will aim to provide a high-quality, reliable service to its clients which will establish it as a first-choice supplier in the marketplace, leading to maximization of profits and sustained and continuous growth.’ The corresponding customer care statement might be something like: ‘To provide a high standard of customer service and care which will enhance the reputation of the company's services leading to an expansion of its customer base and enhancing the profitability of the business.’

The policy also needs to identify how the customers of the business will be made aware of the customer care policies. Some organizations do this by incorporating their customer service standards within their printed terms of trade, although there may be a tendency for the information to be lost in the small print and therefore seldom read. Some clearly publicize their policies in their advertising material or on printed sheets which accompany receipts or sales invoices. Where physical products are produced, the information may be contained within the printed warranty or product guarantee. Others have their policies displayed prominently in their reception areas where visitors and clients can readily view them.

Most of the conventional textbooks on customer care are geared towards larger organizations, and propose commendable ideas such as creating posts of customer service manager, increasing levels of teamwork and multiskilling, integrated audio, video and data communications. These may be great for a large company, but are somewhat grandiose and impractical for the average owner-manager of a new business, who struggles to afford a secretary. What is needed then is to take some of the ideas from the big company model and to apply them on a smaller scale. So in answer to the question ‘How do we go about formulating a customer care policy?’ we revisit the customer expectations which we examined earlier and apply them to the small business environment. For example, we know that our customers expect to receive a positive and prompt response to enquiries. So in place of the ‘integrated communications systems’ of large organizations, we look at practical ways of ensuring that no call from a customer is overlooked and all enquiries receive a response within a specified period of time. In fact, within small firms the formulation of the customer care policy becomes more a case of identifying where there is a potential problem resulting from a customer expectation not being met, then finding the most practical and affordable solution for that problem, and setting basic standards for ensuring the solution is implemented.

How do we implement the customer care policy and ensure that it is achieved?

To answer this question, let us take several examples of customer expectations that might be problematic, and offer potential solutions to these.

Example 1

Problem: Customers expect someone to respond quickly to their enquiries.

Solution: If the owner-manager is not available to answer enquiries, then nominate another person to take that specific responsibility, ensuring that they have or are given basic training in telephone answering skills, and some knowledge of the products or services which you supply. Insist that all details of enquiries are logged. If no one is available, then ensure that an efficient remote-access answerphone or voicemail system is in place, preferably supported by e-mail and fax facilities.

Standards: Make regular contact with the designated staff, at least two or three times a day, to ensure that there are no outstanding queries or to provide answers to any questions which may be beyond their scope. If using answering facilities, check them at two- to three-hour intervals, log all details of enquiries and the dates and times they are received, then ensure that all messages are acknowledged immediately by telephone. Ensure that any actions arising are implemented within twenty-four hours.

Achievement: Monitor log entries to ensure that responses have been made within standard times. Check the frequency of incidents that fall outside the standards and investigate the cause of these.

Example 2

Problem: Customers expect the business premises to be clean, tidy, well lit and pleasant to be in. This can be particularly difficult for a small firm with very confined working space.

Solution: Try to divide the working part of the premises from the part accessed by customers, e.g. the reception area. Ensure that it is warm, dry, reasonably decorated, well lit, and that it is cleaned on a daily basis. Provide some basic seating to make clients comfortable and information about the firm's products or services to keep them occupied if waiting. Ensure that they are greeted and acknowledged on arrival and not kept waiting. Ensure that your staff are aware that the area must be treated differently, and reserved for clients, and why this is so.

Standards: Daily cleaning and watering of any pot plants, regular replacement of reading materials and information, e.g. weekly/monthly, periodic painting or redecoration, and replacement of damaged furniture.

Example 3

Problem: Customers expect a prompt response to problems and complaints.

Solution: Establish a procedure for handling complaints, recording details of the complainant, the nature of the problem, the customer's desired solution, etc. Allocate responsibility for handling complaints to a specific member of staff and train that person in the procedures to be followed. Establish a tracking system to ensure that complaints are followed up and resolved within specified times, and that any exceptions are flagged for action.

Standards: All complaints to be acknowledged within twenty-four hours and action taken to rectify problems within seventy-two hours of the complaint. If further time is required, the client is to be notified of the reason why and given an estimated time for resolution of the problem. Within one week of the problem being rectified, the designated person is to telephone the client to check on satisfaction, and to obtain the client's feedback on the complaints procedure, along with any outstanding problems or adverse comments. These need to be recorded and raised for discussion at the next weekly staff meeting.

The above examples have looked at just three customer expectations, the first being an example of what the customers expect from the staff of a business, the second of what is expected from the premises, and the third of what is expected of after sales service for the products. If we look back at the rest of the customer expectations described at the start of this chapter, we can see that the process used in those three examples can be extended and applied to most of the others, in some form or another, within just about any small business. The list of customer expectations are useful as a starting point for identifying ways of implementing customer care, but the owner-manager still needs to analyse the full range of other expectations which might arise from customers of his or her particular business. Each and every one of them can be treated as a potential problem area, in response to which a customer care policy will need to be formulated. Once this solution to the potential problem is proposed, and a method of implementation identified, standards can be established which will be used to define its success. The final part of the policy, then, is to identify the process and frequency with which the achievement of those standards will be monitored. That in a nutshell, is how customer care policies can be implemented in even the smallest of businesses.

Further reading

Canning, V. (1999). Being Successful in Customer Care. Blackhall.

Smith, I. (1997). Meeting Customer Needs. IoM and Butterworth-Heinemann.

Stone, M. and Young, L. (1992). Competitive Customer Care. Croner.