Why Do Multichannel Service Initiatives Fail?

Companies of all sizes are struggling with the dynamics of how to profitably grow their business in a changing economy. Customers continue to demand exceptional service even when sales and profitability are declining. Employees are disgruntled and shareholders are dismayed. Management is searching for the key to success and finding that all roads seem to lead to customer service.

Customer relationship management (CRM) technology is the latest introduction to the customer care arsenal. Companies are purchasing the tools and still failing the initiative. The total CRM application investment is exceeding $1.5 billion per quarter. This cost does not include labor, consulting services and training. Gartner, Inc. recently conducted a series of surveys and found that 42% of the companies that purchased CRM technology were not utilizing the applications. More than 50% of the applications that were being utilized were considered failures from the customer’s point of view. Failure reasons include:

Treating the symptoms instead of the disease

CRM applications treat the symptoms instead of the disease. They provide tools and procedures to manage customer complaints instead of identifying and eliminating the source. Service should start with product development and continue through every aspect of the business. If a customer is communicating with customer service, then the company has failed that customer.

Resolutions are being applied before problems are fully defined. Finding the source of a problem requires experience and diligence. Many companies do not have in-house resources with the expertise or time to determine the problem’s point of origin. Capital expenditures are often applied when a change in procedure or policy would resolve the issue.

Management underestimates the time, cost, and commitment involved in CRM implementation. Installation of new technology is often expected to be “plug and play”. CRM technology requires extensive system modification, training or both. It is a major project that requires extensive resources.

If you're going to do it, do it right!

Service initiatives are designed from the company’s perspective instead of customers’ expectations. This results in unbalanced service – some expectations are exceeded while others are unfulfilled.

Companies need to create a corporate environment that inspires management, motivates employees, builds customer loyalty, and generates profits. Clichés such as “The customer is always right” must be replaced with mission statements, policies and procedures that equally champion customers, employees, and shareholders.

Every company has its own personality and perspectives which must be reflected in the corporate culture. The steps are simple:

• Develop a mission statement

• Review every policy and procedure to insure that it matches the mission statement and has a valid function within the organization.

• Modify or eliminate any policy or procedures that requires change.

• Identify any issues that are not resolved by the modified infrastructure.

• Review resources to choose solutions to the unresolved issues.

• Implement the new solutions.

• Monitor the progress, revising as needed.

Implementation is not so simple. Plan carefully, communicate thoroughly, expect resistance, and be flexible.

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