Sure, I’ll Jump Right on That!

Posted on February 12, 2012 by Bob Champagne

Inspiring Action- An Art or a Science?

I’ll jump right on that!! Five simple words that can either convey the attitude of a person eager and motivated to get something done, or a sarcastic way of declining a request based on it being either an uninspiring or unrewarding experience (or perhaps both).

Much of what we know about performance management comes from the behavioral sciences and the work of legendary psychologist B. F. Skinner. In case you missed that day in your Psych 101 class, basic behaviorism is built on the simple concept of providing a tangible reward–a piece of food in the case of experimental animals–in response to the correct achievement of some basic task (or, conversely, the withholding of a reward–or administration of a penalty of some sort–for failure to complete the task).

Pigeons, Teenagers, and Everything In Between

When we talk about the field of performance management–be it measurement, goals and targets, tracking and reporting, performance communications, back-end rewards, or the myriad of other “moving parts” within the performance management process–we are really talking about elements that are at the core of managing human behavior.

While most of us regard performance management techniques as a way to motivate our organizations and employees to achieve “peak performance” levels, the same techniques can be used in an infinite number of other areas, across both the work and personal spectrum. Remember, while Skinner’s subjects were originally pigeons, his techniques have been applied effectively in everything from corporate performance to the most basic of personal transactions with our children… and everything in-between.

…and Yes, Customers Too!

Recently, I’ve been giving a good deal of thought to how we can use these same principles in our relationships with customers. There are many things we do to encourage customers to behave in certain ways. Whether it’s buying more of a product, maintaining allegiance to our brand, or other more subtle changes we seek in customer behavior (shifting to less costly billing and payment channels, moving consumption to more optimal places in our delivery system, increasing utilization of our automated inquiry channels (website, IVR, etc.), participating in recycling campaigns, etc.), the age old “behavior modification” techniques used by the early behaviorists, still present in most of our performance management organizations, are just as, if not more, important to our relationships and interactions with customers. It’s all about creating a line of sight between a desired outcome and the behaviors required to drive it, keeping that line of sight visible, and ensuring that all requisite parts of the process are in place to motivate and reinforce staying on that path and consistently hitting the desired target.

A few days ago, a close friend of mine who enjoys spending an occasional weekend in Las Vegas (something I know very little about, or at least wouldn’t admit to if I did!), received, during one of these periodic jaunts, a loyalty card from a casino offering him certain amenities whenever he visited their property–usually free (or at least that’s the spin they put on it) dinners, valet parking, etc. Personally, I find it hard to see these loyalty programs as being of any great value, since I’m sure the rewards pale in comparison to how much casinos “fleece” their patrons. But regardless of how I view that industry and their programs, my friend seems to enjoy them. And, well, who am I to judge?

After visiting the casino a few times in 2011, he received a letter letting him know that he had reached a new loyalty level (again, one has to wonder about achieving a new loyalty level at a casino whose primary mission it is to take your money. But let’s not digress again). After quickly congratulating him on achieving this “new loyalty tier”, the program manager went on to describe how close my friend was to reaching the next level beyond his newly attained one.

I may not have all of my numbers exactly right, but it went something like this: “Congratulations on achieving our Silver level by earning 15,000 points! You’re now only a few steps away from hitting the Gold level. By earning an additional 900,000 points, you’ll enjoy all the benefits of Silver PLUS all the many new benefits reserved exclusively for our Gold members!” etc, etc, etc…

Sometimes there is not enough oxygen on the planet to describe how many things are wrong with a particular business practice. This was one of those times. But the letter alone did most of the damage. Whatever the expenditures required to get to the “silver level” (and I really didn’t want to know the details), simple math told him that he’d need to spend many, many, many multiples of that to even approximate the next level. After a good laugh, his response was: “Sure, I’ll get right on that!”

Motivating Loyalty-

The good, the bad and the ugly…

Loyalty programs all include features of this sort: tiers of benefits that reward buying behavior, incentives for climbing to the next tier, quantifiable measures and tracking schemes that let you know how you are doing on your progress, and all the communication required to motivate you up and over the “next hurdle.” It doesn’t matter whether the program is for frequent fliers, hotel visitors, or even banking savers (an alternative I would encourage my friend to consider). There is no doubt that such programs work.

What differentiates the good ones is not simply the presence of elements like measures, goals, and rewards but, rather, the range of “moving parts” within the PM process I alluded to earlier. For example, let’s look inside my friend’s experience. It wasn’t the lack of a measurable outcome or awareness of what he had to do to get to the next tier that created the breakdown, but rather the enormous gap between the tiers (where the target was set), its level of achievability, and the manner in which progress was communicated.

Sometimes the issue is as simple as managing distinctions between tiers and levels. For a person like me who travels extensively, upgrades, for example, are certainly important. But as airlines continue to consolidate, customers who might have grown used to being consistently upgraded now find that while they were once big fish in a small pond, they have now become average-sized fish in a much larger lake. Anyone caught in the consolidation of the United and Continental loyalty programs knows this first-hand. In fact, there are now more “elite” than “non-elite” fliers (usually by a factor of two) competing for that “special boarding” privilege (essential for getting dibs on very scarce and valuable carry-on luggage space). So for me, the boarding privileges have become more valuable than the upgrade itself. Simply differentiating between platinum, gold, and silver elite fliers in the boarding process would improve the experience of those with the highest travel frequency. Further distinctions (within the higher tier) would also help to create more perceived equity within the ever growing mass of frequent travelers when it comes to upgrades.

More often than not, the differences lie in more subtle application of the “moving parts” within the process. There is a principle most of us may remember from that Psych 101 course that deals with the specifics of reinforcement “schedules” (variable/fixed intervals, for example). While it’s nice to get “upgraded” every single time we exhibit the expected behavior, true behaviorists would tell you that is a clear path to complacency (besides which, the experimenter–or in our case, the program manager–ends up spending a great deal more than necessary in rewards in order to achieve a desired result). Whether they are right or wrong in this assertion is not the issue; market research can answer that. The real issue is that nuances such as this remain very much in play and should not be simply ignored or overlooked in a program’s design. Most of us can recall a time as a customer when receiving an unexpected extra (what we in the south call lagniappe ) did, in fact, generate good will and motivate improved buy behavior. A colleague of mine talks about this quite extensively on his blog “Marketing Lagniappe,” and, although he does not purport to be a true southerner, he understands the concept and its application better than most that actually hail from the “Big Easy”.

Incorporating Performance Management into your CEM strategies…

Like any good chef, there are many ingredients that need to be mixed in the correct sequence, at the right temperature, and presented in the right way to create that high-quality, positive experience. Same goes for designing our customer experiences:

Are the incentives you’re offering ones customers even care about? How much time and energy are you wasting on deploying innovative tools that have more impact for you that they do for customers?
Are your incentives easy for customers to redeem? .Small “point of sale” rebates are often have far more “relevant impact” than larger ones that require more customer effort to redeem (after adjusting for lower redemption levels)
Do you rely on hidden tricks to manage program costs (e.g., points that expire, rewards that require supplemental cash payments, etc.) that can actually produce more negative that positive impact on customer experience?
Are the measures you’re using easy and simple for customers to understand and use in tracking their progress to that next reward or level?
Have you considered the effect of different reinforcement schedules? (Fixed versus variable intervals? Different types and quantity of rewards?
Have you given enough thought to where program “targets” (rewards and tiers) are set?
Are the targets achievable in reasonable amounts of time?
Is your messaging and communication sufficiently compelling?

Clearly these techniques apply any time we are trying to convince someone to “jump right on it.” But in the world of customer experience, where competitive forces are always at play and differentiation is becoming more and more critical, it may just be the most important consideration in your product and program design.

-b

Bob Champagne is Managing Partner of onVector Consulting Group, a privately held international management consulting organization specializing in the design and deployment of Performance Management tools, systems, and solutions. Bob has over 25 years of Performance Management experience with primary emphasis on Customer Operations in the global energy and utilities sector. Bob has consulted with hundreds of companies across numerous industries and geographies. Bob can be contacted at bob.champagne@onvectorconsulting.com

Metrics that make you go…YAWN…

Posted on October 28, 2011 by Bob Champagne

Inspiring or Uninspiring? -It all starts with the strategy…

On each client engagement, regardless of type (Business Planning, Assessments, Turnarounds, Process Improvement, etc.), we invariably find ourselves working extensively with what I call the company’s or business unit’s Strategic Performance Framework (i.e., the specific goals, objectives, and KPIs of the area in focus). That is because these three critical elements serve as the foundation for everything that follows. It essentially answers the proverbial question “For the sake of what? (FSOW?). FSOW are we making this or that investment? FSOW are we developing a new product? FSOW are we consuming resources to improve a specific business process? FSOW are we changing our organization chart (again…)?

Without a thorough analysis and understanding of goals, objectives, and KPIs, any plan that is developed will simply be a formalized road map for throwing darts at a wall. Goals and objectives tell us the destination. KPIs give us continuous feedback as to whether or not we’re on course for our journey, or if deviations from plan are occurring.

This shouldn’t be new to many of us, as any manager worth his salt understands the basics of strategic thinking and performance management. Yet, when we step back and look at the organization or business unit in total, it’s not unusual to observe some big “cracks” in the foundation. And often it is often the KPI’s and metrics that are the first indication that the strategic underpinnings of the business unit are starting to get shaky.

Strategies vary…and so should KPIs…

Working with as many organizations as I do, you would naturally expect the destinations of each client to be different. Take “customer contact” organizations, for example, where there are clearly a myriad of contributions that the organization can be set up to achieve — providing purely reactive service, converting leads, driving participation in customer programs, increasing market share, retaining customers, building loyalty… the list goes on. And most often, these goals and objectives do, in fact, differ from company to company (although there is a growing tendency among managers to “follow the pack” where goals and objectives are becoming more about “maintaining the course” than about providing new and inspiring destinations — a subject for another day!)

But despite the wide array of strategies we expect, and often see, we still find that nearly every customer service organization focuses on the same operating metrics. Back to the Call Center for a moment, here’s a list I can almost guarantee that EVERY company focuses on.

Speed of Answer/Service Level
Abandon Rate
Call Queue Length
Average Handle Time
Agent Satisfaction
Agent Availability/Productivity

The list goes on…

No matter how different the objectives are for the Customer Service channels, the measurements (the things the reps care most about since they influence everything from raises to career progression) remain the same. Don’t believe it? Next time you see your call center manager at the coffee machine, ask them what the top three measures of success are for their group. Try the same question with the reps themselves.

How can that be? Dramatically different destinations, yet metrics that tell you little about progress toward the destination, assuming your mission is something other than churning calls, tasks, and shifts.

Are you “de-motivating” your workforce?

This is clearly a sad state of affairs, because it not only tells us how disconnected our day-to-day activities are from our strategy (read PURPOSE), but really exemplifies how intellectually lazy our strategic planning processes have become. Assuming the organization has developed a compelling and inspiring purpose (which many have, but most still lack), very few have a set of KPIs that track with it. Worse yet, most of these KPIs (the ones above that have been measured for decades) scream for more clarity, consistency, and targets based on something other than “finger in the wind” aspirations or the “annual 5% improvement.”

And as these KPIs trickle down into the organization, their relevancy begins to wane exponentially. What can a call center manager or rep do from one day to the next to drive an outcome like average service level? Sure, there are long term strategies to “course correct” when negative trends emerge (better forecasting of workload, more flexible staffing strategies, etc.), but what about day-to-day behavior? Most often, this is left to the intuitive feel of the operating manager and their motivational style, which can affect consistency and effectiveness over time. Even if you end up measuring things that are “conventional” or somewhat dated, failing to link these in some coherent and causal manner to the organization’s broader goals will undoubtedly elicit the proverbial yawn…that is assuming they haven’t already dismissed the metrics as irrelevant.

Waking up your strategies and KPIs…

So here are my five tips for “waking up” your customer metrics:

Make sure they are built on the foundation of a compelling and clearly articulated strategy. If your strategy doesn’t get you out of bed energized every morning, you’ve got more work to do. Resist the temptation for that “follow the pack” 3-5% improvement gain from last year. What is it your business unit is really there to accomplish? Think business outcomes (sales, leads, changes in customer disposition, etc…) rather than operational activities (calls answered, transaction speed, etc…)

Line up your tactical objectives to your strategic purpose. If your goal is, say, to improve customer loyalty, then your objectives should revolve around the known drivers of loyalty. And avoid the “circular answer” to these questions. An objective for attaining loyalty is NOT to improve transaction satisfaction, but more likely, to eliminate the need for the transaction in the first place.

Develop relevant, clearly understood, customer-centric KPIs. Should you really be measuring, “average service level”, or should you be measuring the number of times a call exceeds 20 minutes, or the number/percent of calls that get dropped prior to resolution, etc. I’d submit these are bigger drivers of loyalty and dissatisfaction than, say, average queue lengths or duration of after-call work. Think one or two levels beyond what you’re currently measuring. Think drivers versus macro results. If you’re on a journey from New York to California, a measure like service level is akin to telling you what state you’re in when it would be more helpful to know when you go off course by x%.

Make metrics relevant at the department level AND the work face — the best metrics are those that can be discussed and improved at any level in the organization. If your objective is to eliminate a particular source of dissatisfaction, then declare what that driver is and measure it at every level across the business. Get the organization talking in the same language and counting things the same way, and you’ll be tracking a lot closer to your desired outcome.

Having a set of metrics for the sake of measuring things is not only a waste of time, but can be a real distraction to achieving your desired outcomes as a business. If your mission, goals and objectives have been declared in a clear and compelling manner, then do yourself a favor and spend some time making sure your metrics will guide you toward that outcome.

-b

Author: Bob Champagne is Managing Partner of onVector Consulting Group, a privately held international management consulting organization specializing in the design and deployment of Performance Management tools, systems, and solutions. Bob has over 25 years of Performance Management experience and has consulted with hundreds of companies across numerous industries and geographies. Bob can be contacted at bob.champagne@onvectorconsulting.com

Does Size Really Matter?

Posted on April 13, 2011 by Bob Champagne

A Little “Customer Voyeurism”…

Last week, my family and I took a vacation to visit some of my in-laws in California. For those of you who know me, you’ll appreciate the fact that any trip for me is an opportunity for a little “customer voyeurism.” That is, I very much enjoy watching exchanges between customers and service providers, whether I am engaged in the transaction or not, largely because they provide me with a wealth of perspectives that serve to validate and augment the many years of performance data, benchmarks and trends I’ve collected in my research and client engagements. So, while spending part of my vacation documenting the customer experiences of myself and others may seem a little weird to some of you, I was not about to miss the insights that would undoubtedly be generated by this seven-day excursion into the depths of airline, restaurant, amusement park, golf course, and taxicab servicing processes.

Like most, this trip did not disappoint (as far as the volume of insights and “take-aways” go). While there was no shortage of examples on both the good and bad aspects of the customer experience (too many to share in one post), I decided to zero-in on what I am finding to be an interesting phenomenon, i.e., the apparent implication of company size on customer satisfaction, engagement, and perception.

Here’s what the data from my little informal research gig told me:

The vast majority of transactions (experiences) appeared to be “issue neutral”- apparently meeting expectations of the customer (deduced through a lack of a visible change in emotion on either side)…Note that I use the word expectations deliberately since I believe many customer’s expectations are considerably lower than in past years. Hence, delivering against a “bar” that is set very low is not likely to produce a lot of emotion other than resignation or apathy.
While they were few and far between, there were failures and successes on “the fringes” of the distribution. I’ve shown a simple example of what I mean, although I believe actual research on a broader set of experiences would probably show that the distribution is anything but “normal” /gaussian (i.e. these days it is likely skewed to the left assuming customers still have some semblance of expectation (hope) of good service, which of course, is debatable (I’ll leave that for another post).

That notwithstanding, If we were plotting this data, we’d be talking about a data distribution with some range of values that characterize the majority of observations, and a small number of significant negative (small in number, but “intense” as far as generating negative emotion…and what our lean or six sigma brethren would call “failures”), and significant positive experiences (pure, but perhaps unexpected, delight- or what my friend Stan Phelp’s at “9 Inch Marketing” (no relationship to the title of this post!!!) likes to call “Lagniappe” in his “purple goldfish” project), at the “tails” of the distribution.

In my experience on this trip, the above distribution was more in line with my observations in that there were probably an equal number of positive and negative experiences on each side of the norm, along with a similar proportion of significant negative and positive experiences on the fringes. The following however, was particularly noteworthy.Most

- (90%+) of the really poor exchanges (generating a fairly clear display of emotion from neutral, to visibly “pissed”) occurred with what I would call larger more established companies
- Most (60%+) of the really positive exchanges (generating what we might refer to as “delight”, or as Stan Phelps likes to refer to it, “customer lagniappe”) occurred with small companies (“Mom and Pops” and/ or specialty stores in cottage industries)

I’ll say again, that throughout this trip, I was only able to observe several dozen transactions between a variety of customers and service providers, including those encountered by yours truly. And while this hardly qualifies as a statistically relevant sample, and falls well shy of what I would consider a rigorous research approach, it served its purpose of identifying a subject worthy of some debate and dialogue.

Why Size Matters…

Why does the above phenomenon occur? Hard to say exactly, but my hunch would be that it has a lot to do with the history and evolution of these organizations. Clearly the smaller “niche players” have a vital need to differentiate and compete, since many lack the market size and scale to do so “naturally.” And while service is one way to accomplish that differentiation, you’d expect some real “over-achievement” in this segment. In fact, the brand identity of many of these companies is directly tied to some “exceptional” aspect of their product or service offering (e.g. the special touch in the packaging, the handwritten thank-you note, or similar gestures). It’s a necessity for these companies, and when they realize they’ve stumbled onto a differentiator (deliberately or by accident), it’s relatively easy to clone and replicate.

No so much with the larger players. Sadly, many of the companies causing the above “grief” were once viewed as nimble and leaders in CS space (think wireless providers, regional airlines, etc.). Not anymore. Sure, they all have their positive exceptions, but with these companies, many of the interactions have been routinized into their operational processes and automated systems, most of which were built on the foundation of operational and technology excellence, rather than on the basis of what differentiated their service to begin with. That leaves the only opportunity for real customer “delight” in the hands of standout employees operating “on the margin”, often operating outside of the process to either strengthen the exchange or recover from a process-inflicted problem. While scale and size should be an advantage, many of these companies have allowed it to become a disadvantage.

That is not to say that the larger companies did not generate some level of delight, and that the smaller companies didn’t generate some significant failures. For example, I did get a “call back” from a CSR after a “disconnect” from a rather large company call center, which was nice to see for a change. I also experienced what I’d call a “super save” from an airport employee to avert what could have been a significant failure. And the small companies, on occasion did generate some negative experiences. Interestingly though, my tendency was to “forget” these failures quicker, giving them the benefit of the doubt for not having all of the CRM tools and technologies that larger companies have at their disposal. But in the end, my observations were my observations, and the trends were notable.

Breaking the Trend…

Given the above reality that size does apparently influence customer experience, and recognizing that “shrinking the company” is not the desired path to breaking that trend, companies that are increasing in size and growth need to be especially vigilant in five key areas:

How we measure success – We need to once and for all get beyond the measurement of general perception, because it tells us little about performance against real customer desires, and tells us virtually nothing about what is really happening on the margin.
How we view risk and failure – When we think of risk and failure, we normally think of manufacturing or operational processes, not customer processes. We need to get beyond the notion that 95% satisfaction is acceptable, and into the zone of limiting the number and magnitude of breakdowns on the margin (what are now viewed as exceptions or acceptable tolerance. Think: How would a Six Sigma or Lean driven manufacturing process view this challenge?
How we build our processes – We can start by changing from a functional to a market-driven approach to building our processes and systems. Most systems today are built to optimize cost and effectiveness at the transaction level, rather than the customer level.
How we staff and develop our employees – It is becoming harder and harder to find retainable employees that come “hardwired” with a strong CEM mindset. Finding and retaining them in large numbers is virtually impossible these days given employee demographics and market conditions. We need to look to other industries and functions to learn how to build and clone the human capital skills to support and enable the above processes.
How we manage and reinforce performance – In support of all of the above, we need to change what we teach, how we lead, what we observe, how we motivate, and what we elect to reward in terms of its orientation toward CEM excellence.

The old adage…think globally, act locally…seems to have some relevance here. I am firmly of the belief that the notion of large size, scale and growth can effectively co-exist with high levels of service, at the norm and the margin. It just takes work on the front end to design the right foundation to make it all work.

-b

Customer Engagement and Efficiency- Are these conflicting priorities?

Posted on March 28, 2011 by Bob Champagne

The Challenges of Funding a CEM Strategy…

A few weeks back, I was talking to a client about their latest strategies to enhance what is now known commonly as “the customer experience.” And like most companies that are working tirelessly on driving their customers toward higher levels of satisfaction, delight, and our latest aspiration, “engagement,” this company was going through all the common challenges of funding their new Customer Experience Management (CEM) strategy.

But also, like many others, funding their CEM strategy is meeting some pretty big resistance from their CFO and others who are trying to make corporate “ends meet,” especially in this economic climate. More and more, these two perspectives are clashing, not because the organization fails to value investment in Customer Service (CS), but more so because the impacts associated with that those investments are often less direct and less tangible, at least compared with the realm of immediate cost and productivity savings that produce faster (albeit not always sustainable) payback to the bottom line.

The Cost/ Service Trade-off: Myth or Reality?

For over two decades of working in the Customer Operations arena, I’ve heard clients invariably revert to the “perceived” trade-off between customer service levels and cost savings or efficiency efforts. That is, the notion that there is an inverse relationship between our ability to improve service levels and our ability to capture CS related productivity and cost savings. And for a long time, the data supported this notion. But as technologies improved, and companies began to increase investments in CS-related technology, tools and process changes, select companies started to prove that notion false by demonstrating the existence of both high service levels and low cost at the same time–companies clearly worthy of the term “myth busters”.

Yet despite all those great examples from the 90’s, we are now seeing many return to the proverbial “trade-off” as a reason for deferring further investments in their CS infrastructure. Make no mistake, there are clearly companies that are pushing the envelope of customer delight, and perhaps even engagement, but more often than not, investments in CEM, and even critical investments in basic infrastructure, are once again hitting the funding wall.

Some of this is clearly driven by the current economic climate. As a CEO from one of my energy clients said recently, “We haven’t given up on CS. But these investments are discretionary, and right now we are struggling to ‘keep the lights on'”. And, while on the surface, this may provoke emotions of heresy from those in highly competitive markets, it’s hard to argue with financial realities. At one time or another, most CS executives, regardless of industry, have encountered this same argument from their C-Suite executives.

Unfortunately, for some, the lack of investment in that infrastructure has created a bit of a back-slide in performance, creating the question of whether we are back to the days of the proverbial trade-off.

Reversing The Course…

As with most things in life, the cup can be either half empty or half full based simply on the lens through which we are looking.

Sure, we all want to delight our customers and make them happy. But from a financial perspective, there is always an ROI at play, and it’s not always easy to establish a causal linkage between that “added delight factor” and the bottom line. Hence the conflict.

But this assumes we are trying to impress, delight, or otherwise “engage” the customer for the sole purpose of selling more of our product or service. And that is clearly part of it. But again, at the risk of offending our hardcore sales and product advocates (of which I am one), I would assert that there are many other reasons for having an engaged customer that go far beyond the next product sale or any direct influence on buying behavior at all.

Beyond the Obvious…

From my perspective, “Engagement” is about changing the overall predisposition of a customer from one of negative predisposition or neutrality, to one of positive engagement that is leveragable in some context. That context could be higher sales, repeat business, or Word of Mouth (WOM) referrals, but it could also serve a variety of other purposes.

One of those purposes is cost savings. What?

That’s right, cost savings.

Over the past several years, we’ve completed a variety of assignments that were geared to identifying efficiencies where the mandate was “zero degradation to Customer Satisfaction”. Not an insignificant challenge. Especially when you consider that most companies have explored every way under the sun to drive more productivity out of their workforce, and have automated just about everything they can automate. And in some cases, these efforts have in fact degraded service level.

But many of those changes were inflicted on customers in a “push fashion”. Sure we’ve made tons of good changes in everything from local office closures, to call center automation improvements, to web interaction, but many of those changes were “pushed on the market” regardless of the level of satisfaction or disposition it happened to be in at the time. Yet we still wonder why the acceptance rates on what may appear to be wonderful customer options are at levels well below their potential. Experts claim that something as basic as “paperless billing” should be hitting 50-70% saturation in the next 3 years, but most of us are only at a fraction of those levels. But to me that is not surprising, given that we have not yet engaged the customer who we are asking to accept these changes. At least not in the spirit of how it is defined above.

Engagement for the Sake of Cost Reduction ?

Just for a second, put on your CFO hat and consider the following argument.

Cost is a product of both efficiency and transaction volume. We can decrease cost per transaction by 5,10, or even 20% in the form of cost-per-call, cost-per-bill, cost-per-payment, and the litany of other transaction types we offer. But the large majority of cost still remains.

Now think about the other side of the equation. Transaction volume. Different story entirely. When we eliminate a transaction, be it a printed bill, a mailed payment, or a call to the call center, we eliminate 100% of the cost. Looking at it this way, there is no question where our focus should be. And looking at the potential that our recent advances in technology could have on enabling these reductions in transaction volume, it’s rather amazing that such a large part of our focus is still on operating and productivity gains.

On this basis, and given the potential that exists in the workload dimension alone, it is conceivable that savings of 30, 50%, or more are possible, and go well beyond what we would ever consider from mere productivity gains.

It all starts with Impacting Predisposition and Behavior…

Given the impact of workload on bottom line, why wouldn’t that become our primary focus?

Perhaps it should be. Or at least one of our primary goals. But haphazardly looking for where we can drive customers to self-service channels without a clear strategy will get us right back to square one. The “win win win” (CCO, CFO, and Customer) if you will, is only achievable if the levels of potential I describe above are fully realized, and accomplished in a manner that leaves the customer satisfied and engaged.

Engagement is about changing customers’ predisposition from negative or neutral to positive and engaged. Once that is accomplished, there exist numerous ways to leverage that engagement, including getting the customer to willingly shift the nature and frequency of their interactions with us, thus decreasing transaction volume. But that is only the tip of the iceberg, as the companies mastering this dynamic are finding out.

But it all starts with the lens we look through.

So next time you are faced with hitting that infamous “funding wall”, or get challenged on the basis of your new CEM strategy, think beyond the obvious.

-b

For more on driving Customer Excellence through combined efficiency and service level focus, see the folloowing posts on EPMEdge.com . Related articles include:

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