Conclusiones

A tough situation…

In late 2007, our call center, which provided technical support for accounting, payroll and management applications for small and medium-size businesses, had a staff size designed to take around 3,500 calls a day. On January 2, 2008, we received 104,000 contact attempts, in response to a major shift in Spain’s national chart of accounts. On January 3, we fielded 98,000 attempts. On Friday, January 4, 92,000 attempts were made to contact our company.

In all, the first three months of 2008 were very tough for everyone, and 50,000 to 105,000 call attempts were made every day. Customers spent hours trying to get through to technical support to get answers to urgent and important questions about the new statutory requirements. When they finally did get through, the ensuing conversation was tough: “About time! I’ve spent several days trying to get through to you. My contract with your company says you’ll provide me with support, help me out… But you’ve managed to make me feel completely powerless… Is this how you treat your customers?”

For our part, we did everything we could. We extended our working time, hired more support technicians, improved our technology and processes in record time, returned the most urgent calls every day, bolstered the information available on our website. Our team made an incredible effort, coupled with our customers’ patience and an investment of €10 million, which was big money for us.

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And we made it. We finally managed to provide support to all our customers.

We cleared up their doubts. We helped them implement the new national chart of accounts and continue to operate normally while complying with the new statutory requirements.

Throughout the whole process, we continued to conduct our service quality and satisfaction surveys. After every call, customers were given the opportunity to rate our performance on a scale of 1 (highly dissatisfied) to 5 (highly satisfied).

Our scores had traditionally ranged from 4.5 to 4.8, i.e., our customers rated our service highly.

Customer satisfaction was one of our hallmarks and our competitive edge. Our support technicians were well-trained and knew how to “smile over the phone.”

They had long track records (average length of service was 9 years) and were proud of doing a great job. In fact, in late 2007 we were awarded the “Gold CRC” in our category by the Spanish Association of Customer Contact Center Experts (AEECCC) in recognition of excellence in our relationship with our customers.

Surprisingly, in early 2008, while in the midst of the avalanche of calls, the change in our satisfaction survey score was negligible: we slipped just two-tenths of a point, and our ratings ranged from 4.3 to 4.6. It seemed we had successfully got over the hitch: customers had taken a favorable view of our efforts and investment, and acknowledged our technicians’ expertise and great service attitude.

We sighed with relief.

A few months later, we started to wonder why things had turned out this way.

How could our customers, who had spent hours and even days of their time trying to get through to us, nonetheless give us a favorable score? Were the results real?

They were based on more than 30,000 survey questionnaires administered in those months. But how could we know for sure?

We launched a project specifically to get an answer to these questions. Thanks to the support received from IZO, Strativity and its CEO, Lior Arussy, we had our first brush with the concept of “customer experience.” We conducted the first surveys to measure customer experience based on our “moments of truth.” And we saw the first results.

Then relief became concern.

… and it gets worse

In the first quarter of 2009, contract expiration and renewal came up for tens of thousands of customers who had suffered the consequences of our contact center bottleneck the year before. What would happen? Which would turn out to be right, the (highly positive) satisfaction surveys or the (highly negative) experience surveys? Would customers remember what had happened twelve months earlier, or would they acknowledge the changes we had implemented and our significant service quality improvement of the past six months?

Our worst fears proved accurate. We were hit by the lowest contract renewal rates in the history of our business. From an average annual rate of 85%, we dipped to less than 75%, and less than 65% for some contract types.

This was a hard, direct lesson that taught us two things:

• Customer experience is different and much more important than customer satisfaction.

• Customer experience impacts earnings.

Experience is more important than satisfaction

Our company had always paid a lot of attention to customer satisfaction and service quality. As I mentioned earlier, customers gave us very high scores and we received accolades for our technical support; for many organizations in our industry and elsewhere we were a benchmark to be emulated.

When we started our customer experience measurement project, we drew up our “moments of truth” map, showing all points of contact with our customers. The map revealed 17 opportunities to provide experiences, of which only three had to do with access to the telephone support line, which was where we’d had a problem six months earlier.

So when in late 2008 the first results came through of our customer experience survey we were surprised to see that our scores were poor at almost all points of contact.

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The first reaction was denial. For successful professionals with many years’

experience, getting an adverse report on one of our historic strengths - customer relationship and customer service - was embarrassing. It was common to hear things like “the report is wrong,” “the results are irrelevant,” “the company helping us take the survey knows nothing about our industry,” or “this is impossible.” The most widespread reflection of all was: “Who cares about experience? It’s satisfaction that counts anyway.”

We were soon proved wrong, however. And yet a mistake is a good thing if you learn from it. What did we learn from our mistakes and our later work on the concept of experience?

We learned that satisfaction is not enough. Service quality and the rational parameters by which it is measured are a mere threshold we need to fulfill just to be in the game. In our case, market leadership and thousands of customers renewing their contracts every year had given us a false sense of security. When some of our customers had a highly negative experience at some of our points of contact, they decided it was time to reconsider the relationship.

We learned that to stand out from the crowd you need to decide how you want your customer to remember his interactions with your business. Every point of contact is an opportunity to turn that desired recall into a reality. If you can’t decide what you want, it is very hard to make this happen. You must lay solid foundations, or the experience you provide is likely to be diffuse and uneven. And high customer satisfaction doesn’t give you an edge: it just means you are in the game.

We learned that improving customer experience is hard work. It is important to realize that changing your “moments of truth” isn’t easy, and you can’t do it at short notice. Transforming operations, training people, modifying systems, changing marketing messages, constructing new indicators: it’s a whole new world. It requires great effort and determination, and this is something you need to know before you start. Normally, we are ready to offer quality and satisfaction, not experience.

We learned that prioritizing is vital. When you first see that multiple points of contact require improvement, the temptation is promptly to undertake an overall change. We decided to focus on specifying what our overall experience ought to be like in the four most important aspects (out of a total 17) in terms of impact on the customer. This enables you to learn the language and practice of experience gradually, and the people working at the company can process the change at a reasonable pace.

We learned that experience does give you a competitive edge. What we had not imagined was that working towards improving our customers’ experience would provide us with opportunities to innovate in many respects: product innovation, service innovation, process innovation, infrastructure innovation, organizational innovation. These were incremental, non-disruptive innovations which translated into competitive advantages we could incorporate to our organization. This progress enabled us swiftly to enhance the value perceived by our customers and restore their trust, until we had recovered contract renewal rates prior to the decline of the first quarter of 2009. Service quality does not offer competitive advantages - it is normally a given in the market. It is experience that can make you stand out.

We learned that nothing can be done without commitment from the company’s leading executives. The experience path is tough, because it involves developing a new culture and calls for many changes in the received way of doing things within an organization. One clear example is that for our employees to provide extraordinary experiences to customers, they typically need to make decisions above their level of authority and without time to check with a superior. This means that a wide measure of discretion must extend throughout all layers of the company.

And cultural changes are unfeasible without getting the green light from the CEO, chairman, managing partner, or proprietor. Service quality and satisfaction can be managed from any position in the company - but experience cannot.

Finally, we learned that once you start down this path there is no turning back. When a company sets out to improve its customers’ experience, it sparks a highly interesting cyclical process. First, the need to improve experience is acknowledged. Work is done, progress is made. Customers become aware of this new personality and their perception improves. Over time, customers get used to it, the “new experience” is no longer novel… And you need to start over. The ongoing cycle of improving experience requires a huge cultural change in most organizations. And those changes are the toughest to make.

Satisfaction is process-based; experience is culture-based.

Experience is just as important in B2B markets as it is in consumer markets.

Organizations are people.

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The financial impact of experience: “FIE”

In 2009, our customers’ negative experience translated into an adverse financial impact. Thanks to many months of work to improve our customers’ experience we turned the situation around. But could we have done more? The key question for us from then on was: “How can we offer our customers an extraordinary experience and convert it into provably positive financial effects that exceed our historic performance?”

Our response took the form of undertaking a veritable internal revolution.

Offering “ECE” (Extraordinary Customer Experience) became our main strategic axis. This book provides a wealth of guidelines on how to create a good customer experience. We applied most of them, and continue to do so.

But the highpoint of our transformation process came in 2010, when we set in motion the CEI (Customer Experience Index) project. We wanted to evaluate the financial impact of an extraordinarily positive experience so as to ascertain whether we could translate our efforts into improved earnings. We defined two populations, each of 2,000 customers, with regard to which we were going to measure the critical factor displaying their loyalty to our company: the support contract renewal index.

The populations were defined as follows:

Experience population: We were going to poll these customers on their experience with our company based on three questions (NPS, mentioned in an earlier chapter, and two more questions):

• Do you recommend our products and services? (NPS)

• Do you recall your interactions with the company as positive experiences?

• Is it being a customer of this company worth your while?

Customers returning a score below 7 (out of 10) would be monitored individually.

We would ask them why they had assigned a low rating, and what we could do to turn around their bad experience. Later, we would try to turn their experience into a positive one and proactively follow up that customer. No specific action would be taken regarding the rest. We assumed that a score ranging from 7 to 10 indicated a customer who had had a good experience. (This was less demanding than the NPS concept of only assuming a good experience for scores 9 and 10 - but it seemed adequate to us at the time.)

Control population: We would treat customers in this group in accordance with the standard lifecycle, which had garnered us excellent results for many years.

We approached the project with a blend of enthusiasm and doubt. We had been burned by our customers’ bad experience; we had understood we needed to improve - and we had improved. But would good customer experience turn out to be a positive competitive edge, or was it simply something we needed to do to maintain the status quo? Would customers appreciate our efforts to improve their experience and show this in the form of increased confidence in us? Would it be possible to offer an extraordinary experience while sustaining our company’s profitability? Could this be done in an operationally manageable way, which was vital in an environment where we were dealing with a high volume of customers, each of whom we wanted to treat as if they were unique?

The results came through four months later, and they were striking.

We found out that customers in the “experience” population exhibited a contract renewal rate 11% higher than customers in the control group. So, if we managed to extend this practice to all our businesses and customers, this would mean a potential impact on earnings of about €10 million a year.

We had proved that a positive customer experience is directly associated with a tangible, measurable and readily implementable financial return.

That’s some experience!

A few months later, our Customer Experience Index enabled us to win the first CEX Prize awarded by the Association of Centers Promoting Excellence, under the title “Connecting emotionally with each customer.” But that is another story…

Conclusions

The title of this book chapter is “Customer experience in B2B markets,” because customer experience is too often thought of as relevant only to the consumer market. I have chosen to use an experience of my own to show that this is not the case. I’m not an academic or a management guru or an intellectual. I am simply someone who has seen first-hand the fascinating process of improving customer experience. And it was in a B2B environment that I saw it happen.

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My story could be the story of any other company. Your own, perhaps. I hope it has been of interest to you.

I should like to end this chapter with a discussion of the following two topics, one of which is dealt with in depth elsewhere in this book:

• Employee experience

• Loyalty

Employee experience. In the years we spent working towards an improved customer experience, we found that nothing can be done if our employees’

experience does not also improve. The first question we must ask is: “How do the people who work here feel?” If the answer is “not so hot,” then it is better to focus our efforts on improving the experience internal to the company before attempting to offer a good experience to our customers. When we started out, we tried to do this the other way around. It didn’t work.

Loyalty. This is something we all know: We are not loyal to what merely satisfies us. We are loyal to what we love. Even in B2B markets.

References

Arussy, Lior, Customer Experience Strategy - The Complete Guide From Innovation to Execution 2010, Strativity Group. ISBN-13: 978-0578047577

Kotter, John P., 1996. Leading Change. Harvard Business Review Press. ISBN-13: 978-0875847474

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Innovation in creating