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How to win through great customer service.

Customer service is everyone's responsibility in an organization. However, the basic, underlying commitment to service rests with the top person in that organization. It is not a responsibility that the top person can delegate. There are three important issues:

1. Why it is necessary for your organization to be committed to service, regardless of what type of organization it is.

2. Why it is necessary for the top person to take the lead in this commitment.

3. How the top person can make that commitment and begin to institute it in the organization.

Service and Competition

When an established business suddenly launches a major effort to improve service to its customers, it's usually not difficult to figure out the reason. Undoubtedly, a new competitor who is promising and offering better service to the customers of the original business has moved into the market.

If you are the established business, is this the best time to begin improving your service? No. It's usually pretty late by then. You may survive, but you will never recapture all of the business that your new competitor has taken away.

So the time to begin is now. If you start to provide stellar service to your customers now, you can:

* set yourself above your existing competition.

* make it difficult for new competition to get a foothold in your market.

A number of utility (gas, electric, water) companies in North America, for example, are learning this lesson. They are launching massive, organlzation-wide, and continuing customer service efforts, even though they currently have no direct competition. Why?

"We see the writing on the wall," comments one utility executive. "We saw what happened when the telecommunications industry was deregulated. We expect to have stiff competition for our services in the near future, and we want to be ready for it. When new companies begin offering competitive utility services to our customers, we want the customers to choose us!"

Lessons In Organizational Commitment

Over the years, many executives have learned some lessons about topdown, total company commitment the hard way, as evidenced by interviews with them regarding past programs. Here are some examples:


When the energy crunch hit in the mid-1970's, most companies launched some efforts to better conserve and manage energy.

The companies that turned out to be less successful were those that vested these responsibilities with their engineering departments. "After all, energy is the engineering department's responsibility," they rationalized.

The companies that turned out to be more successful were those that vested these responsibilities with everyone in their organizations. All employees in all departments were required to become energyconscious and encouraged to submit and implement ideas to better conserve and manage energy.


When the computer began to gain wide-spread popularity with businesses of all types, companies had to decide how to best use computer power.

The less successful companies, large or small, felt the "contraptions" should remain exclusively within the data processing (DP) department's (or the "techie's") domain.

The more successful ones made the DP department or individual the focus of the expertise but gave all departments access to valuable data via desk-top units.


When the quality improvement rage hit in the early 1980s, many companies launched quality improvements efforts.

The less successful ones saw these efforts narrowly. "After all, quality refers to products, so we will let our quality control department wrestle with the production department over the issue."

The more successful ones realized that quality improvement is an organization-wide commitment, affecting not only each employee's function, but each supplier's function. These organizations elevated quality management to the vicepresidential level, instilled quality values throughout every department and trained quality control inspectors to become organizationwide quality auditors.


Now that customer service is the current rage, most organizations are at least saying that they are providing better service. Many are making genuine attempts to improve service.

The less successful ones vest the responsibility where they think it should be -- in the customer service department.

The more successful ones realize that -- like energy management, computerization, and quality management -- customer service must be an organization-wide commitment, encouraged and supported by top management -- a mind-set from top to bottom.

As Robert Desatnick states in Managing to Keep the Customer (Jossey-Bass, 1987): "If the highest standards of service superiority are to be maintained in the marketplace, there must be no tolerance for mediocrity in any of an organization's operations, internal as well as external."

A Service Organization -Not Just a Service Department

It is crucial that the top person in the organization take the lead in customer service. "But why shouldn't I assign someone else to take responsibility for improving our service to our customers?" that person may ask.

Excellent question. Here are the reasons:

1. Customer service involves more than just the speed with which you ship orders or the way someone answers the phone, greets a customer, takes an order or handles a complaint. It involves:

* making sure that the products and services you provide meet the quality and performance levels that customers expect.

* providing value for the customers dollar in terms of products or services that are reasonably priced.

* making sure that you have enough of the right products to meet your customers' current needs.

* respending to customers' unexpressed needs by: suggesting additional items that might meet these needs (add-on selling); recommending higher-priced versions of products that might better meet their needs ("up-selling"); suggesting items or services from other departments ("cross-selling"); or calling customers to talk about new products or services (telemarketing).

* handling details for special orders that need to be individually sourced or made to order.

* arranging product/service demonstrations and facility tours (if needed).

* coordinating sales leads and new business with outside salespeople.

* training employees on the hallmarks of customer relations.

* ensuring that employees are sufficiently motivated to want to provide the very best service to customers.

* installing, maintaining and repairing products and equipment for customers (field service).

* monitoring warehousing and transportation efforts.

* making sure credit is extended properly and billings are accurate.

* selecting product and service suppliers who will live up to your customers' expectations.

Customer service involves all elements of a business, not just one or two departments. Therefore, the top person cannot delegate the responsibility for the overall program (effort) to anyone who does not have responsibility for the overall functioning of the entire organization. That means the top person must take responsibility for it.

2. Along the same lines, it is not uncommon for organizations to have policies, standards, procedures and even bonus performance goals that affect customer service and cause department managers to come into direct conflict with each other. Here are some common examples:

* While Sales wants sufficient inventory in stock to meet customer needs, Finance wants a smaller (tighter) inventory to hold down costs.

* While Customer Service wants to be able to "emergency ship" as often as necessary to meet customer needs, Distribution wants to limit such shipments to improve cash flow.

* While Sales wants to sell to everyone, Credit wants to place limits on certain customers to prevent losses.

* While Production wants to be able to get emergency parts whenever necessary, Purchasing wants to order sufficiently in advance and in large enough quantities to keep costs down.

Thus, again, it is absolutely necessary that top management become involved, in order to create a coordinated effort among all departments that will maintain a sound balance between service and cost.

Granted, few customers ever get to meet the presidents of the firms with which they deal. Rather, they deal with the firm's employees. So why should top management become involved?

This is exactly what one retail chain store executive asked at a customer service seminar he was reluctantly attending: "Why do I have to learn anything about customer service? That's what I hire employees for!"

"But how do those employees know what you expect of them?: replied the speaker. "And even if they do know what you expect of them, what motivation do they have for doing the very best they can to achieve those goals. You need to show enthusiasm for customer service and show them that you feel it is critical."

"Management actions set the example," states Desatnick in Managing to Keep the Customer. The importance that employees place on customer service is influenced by how important management feels customer service is.

It is important that top management constantly let everyone in the company know what their expectations are and then provide the environment and suppert that will cause them to reach -- even exceed -- these expectations.

"Rolling Out" The Service Commitment

Creating a customer service culture in your organization involves four important elements:

1. ATTITUDE. It is vitally important that you assess your attitude toward your company, your products or services, your customers, the people with whom you work and people in general. If you:

- have a negative attitude toward people,

- are in business only to make money,

- are not truly proud of your products or services,

- view employees as "means to an end" (profit), and

- are only interested in customers for their money,

then you may have a difficult time developing the proper customer service attitude. If you are only "going through the motions," the end result is liable to be shallow, artificial and weak. As such, it will probably never get off the ground, and even if it does, it will never survive. Sooner or later, you will be forced to prove your commitment with actions by making choices between providing the service or making an immediate profit. And your actions will speak louder than your words.

On the other hand, if you:

- have a positive attitude toward people,

- are in business because you have desire to succeed and help others succeed,

- are passionately proud of the products or services you provide and of your company,

- view the people with whom you work as part of a "family" working together to market the products and services of which you are so proud, and

- believe firmly that customers can benefit from what you offer, then you have the right attitude with which to begin your customer service improvement efforts.

2. STRUCTURE. Creating a customer service culture in an organization often demands restructuring the organization with a new focus on the customer. Changing the culture requires three things:

* the recognition of the need to change.

* the willingness to change.

* the action necessary to create change.

Recognition: This involves assessing where you are in relation to customer service in order to determine what, if anything, you need to change. Some questions to answer:

- What, specifically, do your customers expect, and how well are you currently meeting those needs?

- Where do you need improvement? How closely are you meeting your sales and growth objectives, and what role does customer service play in reaching these goals?

- How do you compare with your competition in terms of customer service? Is anyone else doing a better job in any area?

Note: You help to set customer expectations. A customer at an upscale specialty shop, for example, expects a lot more than a customer at a discount department store. But whether you are of the first or second type, you should always strive to exceed your customers' expectations. Of course, the upscale specialty type, where expectations are very high, always has the additional cost of extra service built into its pricing. But overall, regardless of whether you have a low price, no-frills operation or the most exclusive place in town, every customer expects to be treated with dignity and courtesy.

Willingness: Whether you came in at the top, worked your way up to the top from the bottom or built your own organization from the ground up, you certainly have a right to be proud of what you have accomplished. Now, are you willing to return to the bottom? According to the CEO's of most firms that are noted for their excellent customer service, this is where you should be -- at the bottom.

The concept is called "The Inverted Pyramid," as shown to the right of The Traditional Pyramid. It is founded on the belief that the customer is king, positioned at the top. Underneath the customers are the employees, who support and provide direct service to the customers. Below them are others who provide service to other departments. Below them are the managers, who support and provide direct service to the employees. And at the very bottom is the boss, who supports and provides direct service to the managers and through them, all the way up to the customer. In other words, your customers don't serve you. The boss serves the customers by serving the managers who, in turn, serve the employees who, in turn, serve the customers directly.

Action: The actions required to revamp your organizational culture include:

* providing overall service direction.

* writing or verbalizing the organization's service policy.

* defining customer service objectives.

* teaching all employees what is expected of them.

* providing the necessary funding.

* reviewing and evaluating progress.

* promoting customer service to everyone in your organization until it becomes second nature.


Quality consultant Phil Crosby points out that ensuring the credibility of management's commitment is management's biggest challenge. Management must:

* establish the standards that employees are required to meet.

* supply the resources that employees need to meet those standards.

* devote personal time and energy to encouraging and helping employees meet those standards.

How can the top person achieve this latter goal? One possibility is to, on occasions, work "shoulder-toshoulder" with employees as they are serving customers. This helps the top person see what employees are faced with and reinforces his commitment to customer service in their eyes. (For example, the top person can invite customers to call him directly if they are unhappy with how they have been treated. By doing this, he can get a taste of what employees deal with each day.)


Working "shoulder-to-shoulder" with employees provides two additional benefits. It helps the top person understand what customers go through and shows customers in a very tangible way that he is interested in them.

The further a person climbs in an organization and the larger that organization becomes, the further away he gets from the customer. And, say most experts, the further out of touch he becomes with his organization's customers, the less intelligently and capably he will be able to manage. It is therefore necessary to reestablish direct contact with customers. Here are some opportunities:

* In a distribution or manufacturing business, the top person can visit some of his largest customers in person.

* In a retail business, he can get out on the sales floor and work side-by-side with the employees serving customers.

* In a mail order or telemarketing operation, he can spend a day on the phone lines taking customer orders and/or fielding their service calls.

* In any organization, he can read customer letters (pro and con) and respond to those that are appropriate for him to answer.

At Quill Corporation, for example, a customer advocate in the customer service department immediately handles and responds to customer complaints addressed specifically to the president, Jack Miller. Once a week, Jack, his brothers and all the managers review these letters along with the customer advocate's responses and explanations of ac tions taken. In fact, it is not unusual for Jack or one of his brothers, Harvey or Arnold, to pull a particular letter and contact the customer himself either by mail or phone to follow up or to apologize for the error or the problem caused.

Once the organization-wide commitment is in place and is reinforced by the top person's involvement, the next step is to determine what performance standards should be met (including those that will provide a competitive edge and differentiation). Then policies and procedures should be based on those standards.

This strategy, along with how to develop company-wide commitment to customer service; how to hire, train and manage service-oriented employees; how to monitor a customer service operation; and how to take other steps in building and maintaining customer loyalty are all explained in a 64-page illustrated booklet available, free of charge, by writing to: Quill Corporation Canada Ltd., 2150 DrewRoad,Mississauga, Ontario, L5S 1B1
COPYRIGHT 1992 Canadian Institute of Management
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

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Publication:Canadian Manager
Date:Mar 22, 1992
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