Future-Proof Your Customer Strategy

In today's customer-centric world, where businesses compete against each other for the same customer dollar, a single bad contact center experience can have an exponential ripple effect. A 1999 research study conducted by TARP, a customer service survey firm, found that, on average, an unhappy customer will tell 10 people about a bad experience. In turn, these 10 people will each tell a further five people, meaning that a total of 60 people will have heard about a single bad experience.

The debate over the effectiveness of labor arbitrage and offshoring ended some time ago, but the residual cost is still being accessed. Recovery can be prolonged and arduous as customers do not soon forget poor service.

The CFI Group conducted a 2007 study to develop the Contact Center Satisfaction Index (CCSI), a measure to provide insight into the impact of the contact center experience on customer retention and defection. One of the areas examined was the effect of offshore contact centers on customer satisfaction overall. Two critical themes emerged from this section of the survey -- customers who believed the contact center was outside the United States rated their overall satisfaction with their experience 26 points lower, and were almost twice as likely to curtail their business relations with the company.

The CFI study found that the key factor determining customer satisfaction is call resolution. Satisfaction scores of customers whose issues were resolved were 46 points higher than those whose issues were unresolved. The study also found that customers whose issues were unresolved are eight times more likely to cut their business ties with the company.

Customer satisfaction is crucial to building customer loyalty, but it must go beyond that to turn the satisfied customer into a loyal customer. Loyalty is more than customer satisfaction. In his book The Ultimate Question, Fred Reichheld asserts that loyalty can be measured solely by asking one question: Does your customer recommend your goods or services to his or her friends and acquaintances? Although it builds upon customer satisfaction, true loyalty, as measured by recommendation, is a much more powerful indicator of a customer's return business. Need more proof? According to NetPromoter.com, a customer who says he would recommend a company is eight times more likely to be a repeat customer than one who is merely "satisfied."

The answer is clear: A giant step in building a healthy client base is taken when contact center agents are empowered to resolve customer calls. This answer is by no means the end-all of the process of rebuilding a damaged customer base. In fact, it's only the first step. But businesses solely focused on the bottom line, or ones that shortsightedly refuse to invest in empowering contact center agents with the authority to make on-the-spot adjustments, will continue to see an erosion of their client base.

Where does an enterprise draw the line at such empowerment? Obviously this is a question for which there is no one-size-fits-all answer. The balance between cost and empowerment must be weighed, and standards set and communicated throughout the contact center to ensure consistency in customer handling.

The trust factor between management and the front line must be evaluated. Can your agents be trusted to make financial adjustments for clients -- to balance the company's best interests with those of the client base? In most cases, this depends on the quality of the contact center agents. If your average agent is 23 years old, with no strong corporate work history, no advanced education, and no management experience, the answer is probably a resounding "No way!"

On the other hand, if your agents are professionals, with a strong résumé of corporate experience including management exposure and advanced education, the answer is quite different. These more-mature professionals can be better trusted to make on-the-spot decisions targeting customer satisfaction and loyalty, while still watching the corporate bottom line.

It's in this area that we are seeing contact centers evolve. As Fortune 1000 companies are bringing their contact center operations "back home," many are looking at remote home agents to handle their calls, realizing that this alternative model offers an elasticity for scheduling not found in traditional brick-and-mortar centers, as well are a more-mature, professional agent -- at a savings of 20 percent to 30 percent over domestic brick-and-mortar centers. This model offers businesses the opportunity to provide premier service delivered by empowered agents, at a reduced cost.

About the Author
Tim Houlne is a veteran in CRM with more than 22 years of experience in contact center services, technical support, and warranty management industries. Tim is the chief executive officer of Working Solutions -- industry pioneer in the home-based agent model.

Please note that the Viewpoints listed in CRM magazine and appearing on destinationCRM.com represent the perspective of the authors, and not necessarily those of the magazine or its editors. If you would like to submit a Viewpoint for consideration, please email viewpoints@destinationCRM.com.

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