CONSTANTIN MAGDALINA

  |  16.02.2017

Customer relationship – a never ending story

A new chorus has cast a spell over the business world: "customer relationship"

The spell of desires
Sometimes real, other times mimicked, the relationship with the consumer is often limited to the statement "we care about you". Obviously, this overtly concern reveals an economic interest natural for any activity that aims to yield profit.


"The consumer is our focus" or "our commitment to the consumer is" or "our customers are the most important partners" are just some of the formulas most commonly used by companies in their public communication.


If there is no symmetry between what companies communicate and what they actually deliver, the relationship with the consumer is limited to either a customer service department with a purely administrative role or simply to an unprofessional PR.


The reality test
As in any business field, there are companies that excel in building relationships with consumers and others still struggling. The former are leaders in their field, and even propose methods for measuring the performance that become standards in the industry, the latter play within the statistical margin of error of the market share.


For companies concerned with an integrated approach of the relationship with the consumer, the three most important ways of building this relationship and strengthen a customer-focused organizational culture are the following ones:


1. Voice of the customer
This method involves understanding the critical customer requirements and specific needs beyond basic expectations from a product or service.


The method involves identifying customer needs and their classification as:
• “Must be” needs – identified based on returns, complaints, lawsuits, analysis of customers, lost market share, references.
• Primary needs – identified with the help of focus group, interviews, feedback from the sales team, market research, recorded calls.
• Untold needs but which lead the consumer experience up to a higher level - identified by observation, personal relationship with the customer and fulfilled through innovation.


An important aspect about the voice of the customer refers to the way customers define and prioritizes the needs and expectations from a product / service. From this point of view the voice of the customer comprises the following aspects:
1. Quality – the features of the product/service
2. Cost – the hidden costs
3. Delivery – the readiness/delays in delivering the product/service against expectations
4. Service and safety – the after-sale support
5. Social responsibility – the compliance with legislation, environment protection etc.

 

2. Collecting information from every touch point with the customer

This method helps in measuring the processes capacity within the company to meet customer expectations without additional effort. On the quality of information collected and of the measurement system depends the analysis and interpretation of consumer responses.


Pragmatically speaking, a company that provides services to address the relevant customer needs should:
• Making an analysis of activities with value for the customer. In other words "for how much of what I do is the customer willing to pay". Often the client relationship has to suffer from inadequate allocation of resources with value for customer. A lot of opportunities to improve the relationship are missed because worthless activities are so rooted in processes that go unseen, and resources that could be allocated for meeting requirements relevant for the client becomes opportunity cost.
• Identifying the causes leading to the qualification of the customer experience as very bad or very good. In this respect the most easily accessible method is "5 WHY’s diagram". Once the problem is identified by addressing the question "why is this happening?" (generally for 5 times in a row) to the intermediate identified causes, we get to the root cause.
• Distinguishing between correlation and causality. When data are correlated, two variables can be related, but neither of them is cause for the other. For example an increase in sales may not be necessarily the cause to an increase in advertising. In analysing the data, it is important not to say that a correlation is a causality. Only if this distinction is correctly made, companies can make relevant decisions.


3. The improvement of costumer relationship
It can be made after conducting the analysis and interpretation of information gathered. Methods for generating team solutions are: brainstorming, the 6 hats technique (associated to a role that each team member plays once they wear a hat), lateral thinking, mind-mapping followed by the development of selection criteria for solutions depending on the time required for implementation, cost / benefit, impact on the root cause.


By implementing a pilot project based on listening to the voice of the customer, analysing of the information collected and selecting the solutions which will improve the relationship with consumers, the company tests its impact on customer satisfaction and builds a customer-centric culture.


Take aways:
• For a company, if the profit is the rationale of 'having', the relationship with the consumer is the rationale of 'being'. The company exists and thrives to the extent that it listens to the consumer’s voice and understands the critical customer requirements.
• Decoding the needs, classification and identification of the root cause of customer dissatisfaction makes the difference between performers and the rest of companies.
• Collecting information from every point of contact with the consumer is a critical process. Only in this way companies can identify the internal activities with added-value for the customer and the "why's" of the customer experience.
• To improve customer relationships, after analysing the feedback from customers, the generation and selection of solutions comes naturally. The implementation of a pilot project is the relevance test of solutions designed to improve customer satisfaction.
• The company must provide what it promises; otherwise, especially now, in the digital age, the client 'kicks out' the CEO, lowers company in rankings and decreases its market value.
    

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