If a service organization is best-in-class, then obtaining a referral should be easy!

Posted by: on Mar 29, 2012 | No Comments

A recent white paper from the Aberdeen Group about the State of Service Management: Forecast for 2012 compiled the results of over 200 survey respondents who were asked to identify the strategic elements that contribute to best-in-class performance for service organizations. Of the organizations interviewed, only 59% of mid to larger organizations indicated a profit-centric affiliation for their service organizations.

A key insight from this paper is that while all organizations need to be profitable, profitability and improved customer satisfaction are, in fact, intertwined and not mutually exclusive. The paper specifically cites, “An organization does not have to sacrifice the pursuit of customer excellence to ensure operational sustainability and profitability.”

The statistics throughout the paper indicate that those service organizations who applied a disciplined approach toward meeting and exceeding customer expectations regarding service resulted in higher customer satisfaction and retention rates. Excellence in customer service directly contributes to the success and profitability of the business.

Given the uncertainty in the economy, these statistics further the argument to maintain loyal customers. Aberdeen’s research continues to reveal that a higher level of satisfaction leads to retention and loyalty.

Most of the company’s I have worked for or work for are not necessarily looking to grow share of wallet, but are in fact looking for the most valuable  tribute any professional can obtain from a client, a referral to a friend or word-of-mouth endorsement.

This leaves me asking, as the marketer or manager once removed from the service being performed, “Why don’t you ask the customer is there anything else I can do for you?”

If the customer says “no” and is happy, then the door is wide open for the “ask”… “Would you know someone who could benefit from this type of service?”

The customer experience and the voice of the customer seem to be an overlooked topic when discussing best-in-class service. Yet, the study shows that increased customer satisfaction inherently leads to increased customer loyalty – which naturally should lead to traditional word-of-mouth marketing.

While the process must start internally with improvements to all levels of the workforce and enhancements to technology infrastructure, best-in-class service indicates that the use of value-added services will have a higher impact on, and contribute to, repeat usage by customers in the next twelve months.  Therefore, management cannot forgo innovation towards new products and services to further entrench themselves in their customers’ minds and pocketbooks, while allowing for differentiation.

We are entering the era of customer loyalty as a necessity in which to be successful. This new era is about affecting the consumer experience holistically – at every touch-point, through all stages of the customer’s experience.  Simply, customer loyalty is about connecting brands, consumers, employees and channel partners to ensure the brand promise is always fulfilled.

In the service industry customer satisfaction is fueled by the service your employees provide to customers, clients, or guests. If they are not thoroughly engaged in demanding times suffering the stress of economic uncertainty, customer loyalty will not be where it needs to be to drive a best-in-class organization in the future. Employee engagement (possibly using social media) and product/service innovation can help drive customer loyalty, which can, in turn, help create a best-in-class organization.

Customer loyalty and customer retention is the wave of the future for the services industries. How your processes stack up– your employee engagement, your technology and value proposition — will be the determining factors to a best-in-class organization.