Posted by Colin Weatherby 1800 words
This essay looks at customer experience using two excellent articles from the Harvard Business Review as a guide; the first is ‘Understanding Customer Experience’ by Christopher Meyer and Andre Schwager, and the second is ‘Lean consumption’ by James Womack and Daniel Jones .
I have heard officers in local government talking about ‘customer experience mapping’ and the need to understand ‘touch points’. It seems that we are starting to think about how people using council services experience their interaction with us and the resultant service delivery process. It is a good place to start when putting the customer first.
I always think that it is important to differentiate between ‘service delivery’ and ‘customer service’. The first is what we do as an organisation to take inputs and transform them into outputs or outcomes of value to a customer. The second is the interaction a customer has with the organisation in order to obtain a service – was it convenient to make contact, were they attended to promptly, was the staff member courteous, was the request correctly recorded and actioned, etc. The customer experience encompasses both areas and to optimise only one of them is to misunderstand how the customer views the relationship.
Sometimes councils think that answering the telephone or recording correspondence or tracking requests is a service. A lot of effort can go into improving these processes and increasing resources when it is really responding to failure demand rather than improving service delivery. In an ideal world customers wouldn’t have to contact councils about basic services (e.g. broken infrastructure) and if they did they would be given a service commitment that would be met every time (i.e. it will be fixed by Friday). Conveniently fulfilling purpose is a key focus of John Seddon’s Vanguard Method.
In their article, Meyer and Schwager describe the customer experience as encompassing
“… every aspect of a company’s offering the quality of customer care, of course, but also advertising, packaging, product and service features, ease of use, and reliability.’
They make the point that in many organisations few of the people responsible for each of these activities have thought about how their separate decisions contribute to the overall customer experience. Worse still, if they do think about it, they all have different ideas and there is no one senior who oversees everyone’s efforts to bring agreement on what needs to be done. This is local government’s problem with service delivery in a nutshell.
As hierarchical, command-and-control organisations, councils emphasise function over process in the organisational design and performance management processes. Budgets, the business planning framework, performance appraisal, and decision making processes all emphasise functional responsibilities. The fact that many (most? – I am sure no one knows) services are delivered across more than one functional area is regularly overlooked. This is despite periodic efforts to restructure and integrate functions under one functional manager or directorate.
Meyer and Schwager are focussing on highly competitive environments where customers have choices and an appetite to pursue them. This is a major difference with local government where customers are ‘captive’ and without choice for many services. In many ways, and especially because the powers of the state are used to compel payment for local government services, it is even more important that the customer experience is designed and managed.
In an environment where customers cannot exercise choice, payment is not received at the point of consumption, and there is little accountability for the quality of customer experience, the culture of the service delivery organisation can become remote from, or hostile to, the customer.
Work by James Womack and Daniel Jones on ‘lean consumption’ is cited by Meyer and Schwager in relation to improving the customer experience. They say that
“ … simple, integrated solutions to problems – not fragmented, burdensome ones – will win the allegiance of the time-pressed consumer.”
Womack and Jones define ‘lean consumption’ as ‘minimising customers’ time and effort and delivering exactly what they want when and where they want it’. They see it as transforming consumption in the same way that lean production transformed manufacturing. It involves customers and service providers collaborating to ‘reduce total cost and wasted time and create new value’.
The concepts underlying lean consumption identified by Womack and Jones can be described as six simple principles:
- Solve the customer’s problem completely by making sure that all the goods and services work together to do so – provide skilled staff who not only solve customer problems but find root causes and fix them.
- Don’t waste the customer’s time – service providers often send a very clear message to customers through their operations: ‘your time has no value’.
- Provide exactly what the customer wants – design the supply chain to ‘pull’ in response to demands so that you are able to provide exactly what the customer wants.
- Provide value where it’s wanted – design operations to maximise convenience and minimise costs.
- Provide value when it’s wanted – align the interests of the customer, the retailer, the producer and the supplier.
- Continually aggregate solutions to reduce the customer’s time and hassle.
Womack and Jones describe customers as ‘struggling’ endlessly in providing unpaid management of multiple suppliers of goods and services.
“Why is this? Because providers, instead of working together to perfect the entire consumption process, have created an enormous ‘failure industry’ of help lines and service desks to deal with their individual piece of the solution.
Their objective has been ever-increasing efficiency (in terms of their own resources) at patching recurring customer problems. Their management goal has been to minimise time to get the customer off the line while avoiding the hard work of getting to the root cause of the problem.”
How often have you seen this happen within a council? Each department seeks to optimise their own performance or increase their efficiency or reduce their costs with resultant flow on effects to other departments and the whole experience of the customer. The management goal has ceased to be ensuring the fulfilment of customer purpose and has become an organisational internal target or objective. All of this reduces customer satisfaction.
Meyer and Schwager discuss measuring the satisfaction customers experience with services. They see customer satisfaction as result of good experiences less the bad ones. It occurs when the gap between the customer expectations and their experience has been closed. Their main point is that knowing what the customer satisfaction is doesn’t help you to achieve it.
“To understand how to achieve satisfaction, a company must deconstruct it into its component experiences.”
Local government seems to have a fascination with customer satisfaction and a belief that measuring it will somehow enable it to be improved. In Victoria, the annual survey gets members of the community to state the importance of various services and then the performance of the organisation in delivering them. This importance/performance ranking is used to derive the level of satisfaction. I have met many senior officers who do not understand the difference between customer satisfaction and customer experience or the relationship with customers’ expectations.
Anyone who has seriously tried to use customer satisfaction data to improve service performance will know that it is a random exercise. Often the most useful part is the verbatim comments. The connection between things you can do and satisfaction of customers is invisible and unknowable without detailed thinking and investigation. That is essentially what Meyer and Schwager recommend:
“The customers themselves – that is the full range and unvarnished reality of their prior experiences, and then the expectations, warm or harsh, those have conjured up – must be monitored and probed.”
They describe customer monitoring that examines patterns – past, present and future – and the frequency of data capture about those patterns in terms of being ‘persistent, periodic or pulsed’. This is explained in detail in the table below.
Source: Christopher Meyer and Andre Schwager ‘Understanding Customer Experience, Harvard Business Review, February 2007.
Meyer and Schwager describe the customer experience as formed from the ‘internal and subjective’ response they have to all direct and indirect contact with the organisation. An organisation with a successful brand shapes the customer experience by ‘embedding the fundamental value proposition’ in every feature of their service offerings. Councils don’t do this. In fact they often do the opposite with mixed messaging and variable experiences depending on the particular service you are using or who you deal with.
Meyer and Schwager advocate ‘customer experience management’ (CEM) instead of ‘customer relationship management’ (CRM). They compare the two in a table that I have reproduced below.
Source: Christopher Meyer and Andre Schwager ‘Understanding Customer Experience, Harvard Business Review, February 2007.
CEM is a much more proactive, real-time, and active process that engages with organisational leaders to use information to ‘create fulfillable expectations’. Setting ourselves up to fail seems to have become a signature of local government and good CRM systems will make sure that you know each time.
A key element of the change from CRM to CEM is removing the responsibility for the design, delivery and ‘creation of a superior customer experience’ from the front line, customer-facing groups and allocating it to the whole organisation. Leaving this responsibility with the front line customer service staff, which happens in many councils, excuses those more distant from understanding the customer experience and prevents a rigorous response by general management to the intelligence gathered on customer experience.
“Customer experience does not improve until it becomes a top priority and a company’s work processes, systems and structure change to reflect that. When employees observe senior managers persistently demanding experience information and using it to make tough decisions, their own decisions are conditioned by that awareness.”
In local government, many of the customer experience problems will be cross-functional and require someone senior enough in the organisation to own the problem if there is to be an effective response. The work ‘processes, systems and structure’ will need to be reviewed, as discussed in earlier posts (see here, here and here). Customers are often very aware of service deficiencies but can’t think of what might replace them, especially when they are ‘captive’ to public services.
In local government, understanding preferences and experiences, seriously trying to shape expectations, designing service experiences, attuning operational processes and practices at every touch point, and collecting and using CEM data will help improve the customer experience.
It will increase their satisfaction and overcome the sense of being disempowered through limited choice.
Meyer, Christopher and Schwager, Andre 2007. ‘Understanding Customer Experience, Harvard Business Review, February
Womack, James and Jones, Daniel, 2005. ‘Lean consumption’, Harvard Business Review, March.
Local Government Utopia 