While customer satisfaction has acquired strategic priority in the current business scenario, it can be achieved through a culture of discipline
Despite some initial nervousness caused by the watershed economic reforms of 1991, most Indian businesses reacted with alacrity to face the inevitable wave of global competition in all its manifestations including quality of customer service. For the first time, ‘customer service’ appeared as the top-of-the agenda item in board room discussions forcing the companies to acknowledge the growing assertiveness of a transformed customer.
By the end of the year 1994 as many as 79% of the CEOs had begun to consider ‘customer satisfaction’ as one of the top three priorities and 38% of the CEOs ranked ‘getting close to the customer’ as priority number one[1]. Many initiatives were launched by companies to establish a direct contact with the customers, improve complaint management systems, empower customer contact employees, re-define performance metrics and, above all, to bring about a sharper customer focus throughout the organisation. Raising customer satisfaction to the level of business strategy did not come too easy. However, the Indian companies found it necessary to make upbeat promises—partly for the sake of public posturing.
The Policy-Practice Gap
For customers, the quality of service delivered by a company manifests itself in the way the commitments are honored, the degree of responsiveness, level of employees’ competence, and the attitudinal maturity displayed by the customer-contact-employees. If customers feel quite positive about these interactions they consider the company’s culture as customer-centric and they begin to develop a sense of engagement.
A company would be eminently well equipped to deliver excellent customer service if the following drivers of service quality are firmly in place:
- unambiguous customer-policy guidelines,
- clear and updated understanding of customers’ expectations,
- service standards that meet—or preferably, exceed—those expectations,
- appropriate organizational structure,
- stabilized business processes,
- emotionally engaged and professionally enabled employees who can meet the set service standards with confidence,
- a work-place climate that enables clear and concise organisational communication.
Many companies, In India and elsewhere in the world, can rightfully claim to have the wherewithal for delivering good customer service. And yet, it is not uncommon to find that even well-meaning, highly customer-centric companies fail to deliver the promised quality of customer service.
For instance, a top notch bank went too far in blaming me for a bounced check only to find that the bank had committed a serious mistake. A major automobile dealer deliberately used an outdated price list and collected more money before delivering the car to me. An “ethics driven” insurance company generated a fake letter to justify three months delay in refunding a double payment. A “friendly” housing bank took more than 150 days to pay an overdue interest on a term deposit. And likewise, one can recount a number service defaults.
I was highly frustrated, not so much because they gave me a reason to complain in the first place, but more because no one would readily accept the mistake and quickly do something to correct the shortfall. Because I refused to give up, all my problems were ultimately sorted out—but not before I reached or gate-crashed into the office of a senior enough manager.
Schizophrenic Behaviour
Obsessive pursuit of high growth rate as a matter of key performance indicator and induction of new people at the key positions can result in a cultural churn in a company. Too many new products, too many new customers and too many new people can end up with internal conflict of priorities and loss of objectivity. Unless protected doggedly company’s core values may get diluted leading to ambiguity, indecision and loss of initiative. A phenomenon called “organizational schizophrenia” creeps in with a fairly negative impact on organizational performance in general and on quality of customer service in particular.
That is precisely what I experienced in the process of resolving my complaints, with the defaulting companies. I came face to face with two distinct facets of people’s behavior within the same organisation.
- At the operating level, I did get plenty of lip service but in terms of real action it was a usual mix of apathy, evasiveness and attempt to wriggle out of a bad situation.
- At the senior level, the executives were apologetic about what they thought was inexcusable lapse in meeting my genuine expectations. They got involved, quickly understood the issue and made sure that my complaints were resolved to my satisfaction with the utmost speed.
The whole scenario defied any logic and many questions started agitating my mind. I, therefore, decided to explore:
- Where does a disconnect take place between intent and implementation; between policy and practice?
- Why do mission/vision statements and internal policy directives fail to inspire the front-line employees to act purposefully?
- Does this phenomenon represent a cultural diversion within some parts of the company?
- What is the root cause for an organisation to behave in a schizophrenic manner?
As I had expected, the answers to the vexing questions did not lie in the company policy or business processes. The VOICES of the respondents to a targeted empirical research[2] revealed that gaps between policy and practice occur more because of the behavioral rather than systemic reasons:
- Domination of number targets: high-pitched slogans within a company exhorting people to focus on top line and bottom line numbers can result in loss of objectivity, lop-sided priorities and change of perception about the employees’ self-interest. This workplace climate can end up in serious delays in providing after-sales support and can create avoidable customer dissatisfaction.
- Policy paradoxes: structure does not support policy; power of position takes precedence over power of purpose.
- Lackadaisical use of complaint management system: an attempt to evade hard realities.
- Poor communications: often going by an illusion that a communication has occurred.
- Outsourcing of task: perceived as freedom from responsibility.
- Knowledge at the point of action: marked by gaps and inaccuracy,
- Dwindling Employee engagement: people unwilling to put in discretionary effort,
- Cultural discipline. Lack of rigour in enforcing a
The Way Forward
Dig deeper and you would find that most of the factors listed above are the ramifications of two fundamental operating approaches. To create and sustain a strong and positive customer focus the companies would do well to review these approaches and modify them as necessary.
- Customer First—In Word and in Action
Evidence suggests that shareholders actually do better when firms put the customer first rather than focusing on maximising shareholders value in the short term. Nonetheless, executives have continued to work on profit maximisation as their top priority. On the other hand, customer satisfaction has also acquired strategic priority in the current business scenario. Companies, therefore, also want to maximise customer satisfaction as a tool for competitive differentiation. According to the optimisation theory, a firm cannot maximise both customer value and shareholder value at the same time. You have to make a choice upfront. Any attempt to do otherwise can only result in internal conflict within the company. This perpetual conflict cascades all the way down to the front line employees and allows organisational schizophrenia to creep in. - Culture of Discipline
A culture of discipline requires people to be self-disciplined and passionate about their responsibility. It requires people to take disciplined action religiously consistent with the company’s mission and core values. A culture of discipline is not a ruthless culture. It is a rigorous culture. To be rigorous means consistently applying exacting standards at all times and at all levels, especially in upper management.
’Many companies all over the world are beginning to accept that ‘maximizing shareholder value at the cost of negating long-term customer relationship is an inherently and tragically flawed premise’ and that it is time we abandoned it[3]. In an interview in March 2009, Jack Welch—who was once considered the embodiment of the idea that a company’s sole aim should be maximising returns to its shareholders—said, “On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… your main constituencies are your employees, your customers and your products.”
The age of customer capitalism demands a re-think. Herein lies the way forward.
[1] AnandViswanathan, ‘Caring for Customers’, Business Today, 7October 1994, 70.
[2]The findings of this research form the resource material for the book Organisational Schizophrenia: Impact on Customer Service Quality (SAGE 2013) http://www.gkgureja.com
[3]Roger Martin, ‘The Age of Customer Capitalism’:Harvard Business Review, January–February,(2010).