Creating A Customer Focused Culture

L E A D E R S H I P �� P R O B L E M SO L V I N G �� V A L U E C R E A T I O N

Alvarez & Marsal Business Consulting, LLC

Creating Top-Notch Quality through a Customer-Focused Culture

Copyright 2008. Alvarez & Marsal Holdings, LLC. All Rights Reserved.Copyright 2009. Alvarez & Marsal. All Rights Reserved.

Culture

ICMI Contact Center Management Conference & ExpoAustin, TexasJune 2, 2009

How is “Trust” Defined?

Copyright 2008. Alvarez & Marsal Holdings, LLC. All Rights Reserved.

CONSUMER TRUST is the driver for CUSTOMER AUTHENTICITY

The Trust Gap Between Companies & Consumers Widening


So Let Me Ask a Question…..

“Thinking about our experiences

with call centers, what drives us to

‘love’ or ‘hate’ a particular


‘love’ or ‘hate’ a particular

experience?”

The Financial Impact of Quality Customer Care

• Shareholder Value

– Anecdotal evidence suggest there is linkage between bad customer

service/call center experience and declining stock price

• Customer Value

– Customers are “literally” sick of poor service experiences

• Brand Equity

– Significantly diluted; unmet customer expectations

Copyright 2008. Alvarez & Marsal Holdings, LLC. All Rights Reserved. 5

– Significantly diluted; unmet customer expectations

• Call Center Profitability

– It costs more to run the center e.g. hiring of more call center agents

# Calls to Resolve

% Overall Calls # Problems # Calls Offered

1 60% 60,000 60,000

2 20% 20,000 40,000

3 15% 15,000 45,000

4 5% 5,000 20,000

40% 100,000 105,000

$200M

The Financial Impact of Quality Customer Care


Company Assets 200,000 customers x $1,000 annual revenue per

customer

$200M

Cost per Call 5,000 extra calls x $5.00 cost per call

$25,000 extra cost per quarter

Failure to resolve 15% of calls Results in a CSAT drop from 50% to 40%

$80M protected assets or a loss of $20M per

quarter

Quality & Customer Care Profitability Impact (per quarter/per annum)

….and the survey says $20,525,000/quarter or $82.1M/annum

6

Determine critical customer

touch points

(aka, “Moments of Truth”)

from customer’s viewpoint

“Interest Me” “Meet My Initial Need”“Keep Meeting

My Needs”

2

1

1a. Website available > 99.99%

1. Marketing web site2. Advertisements

Defining the Customer Experience

Document Expected Customer

experience (incorporate VOC

Sales Fulfillment ServiceProcess

1. Apply by phone2. Apply by website3. Get notification of decision4. Close financial transaction

1. Account issue raise by phone or email

2. Complain by web mail3. Receive solution to complaint4. Hear about other products5. Take part in surveys

1a. Average hold time < 2 min1b. Application time < 10 min

1a. Average hold time < 2 min1b. 1st time resolution > 95%


Develop tactics to close the

expected-vs.-actual gap

(incorporate VOC and

benchmarking)

1a. Review SLAs with hosting vendor1b. Minimize size of graphics to speed page loads

Determine actual

customer experience

Develop reward & recognition

for achieving or exceeding

expected customer experienceDevelop appropriate set of rewards and recognition

5

4

3 1a. Website available = x%1b. Website satisfaction = y2. Recognition factor = z

1b. Website satisfaction > 4.5

2. Recognition factor > x

experience (incorporate VOC

and benchmarking) 2a. Website available > 99.99%2b. Application time < 15 min

Market

Differentiators

DriversContact Center

Mission Statement

Vision Core Values

Customer Service

BrandEase of Doing

BusinessQuality

Attract/RetainBest Employees

Strategy Articulation Map


Strategic

Objectives

• Contact Center ROI• Cost per Call• New Products Sold/100 calls

Financial Customer Process OrganizationKey

Performance

Indicators

(KPIs)

• CSAT Index (Top 2 Box• Customer Churn Rate• # of Net New Customers

• Response Time• Forecasting Accuracy• Service Level• Abandon Call Rate• Average Handle Time• Sales per Hour

• Agent Peak Performance Index

• Employee Satisfaction Index

• New Hire Speed to Competency

• Generate revenue• Manage budget• Lower cost per call

Financial Customer Process Organization

• Cross-selling/Solution selling

• Partnering• Grow targeted customer segments

• Responsive• Eliminate bureaucracy• Reduce errors

• Effective training• Foster a win-win environment

• Attract and retain best associates


Creating Top-Notch Quality through a Customer-Focused CultureICMI Contact Center Management Conference & ExpoAustin, TexasJune 2, 2009

© Copyright 2008. Alvarez & Marsal Holdings, LLC. All Rights Reserved.

How to Create an Effective Quality Monitoring Form

Quality Monitoring Form Discussion

1. Describe the process for designing your quality monitoring form

2. What metrics comprise the quality monitoring form? What percent of your

metrics are compliance related versus customer satisfaction?

3. How do your agents feel about your current quality monitoring form & process?


4. How well does external or internal customer satisfaction results marry with your

current quality monitoring form?

5. If you can make any changes or enhancement to your existing quality

monitoring form, what would those changes be?

Introduction

• Quality Monitoring is an essential part of call center management

• While the intent of the quality monitoring process is designed to evaluate an

agents’ effectiveness in providing good customer service, in some cases the

quality monitoring metrics are having negative affects on agent behavior and

some erosion in customer satisfaction


• How do we design a quality monitoring form that balances the right agent

behaviors that foster customer satisfaction & retention while ensuring internal

conformance to policies & procedures?

• Capturing & understanding your customer satisfaction drivers and aligning them

with quality metrics is one way of marrying agent behaviors with customer-

focused outcomes

11

Three Customer Value Levers

• Know Me

– A company or agent has knowledge about my problem without me having to state again

– A company has visibility to my behaviors, patterns, trends and sensitivities

• Hear Me

– When I have a problem, an agent can hear “the problem behind the problem” and

demonstrates a willingness to fix it


• Help Me

– The agent has the will, skill & knowledge to interpret my problem and owns my issue to

resolution

– Since the company is capturing my trends, usage and patterns, the company/agent

proactively offers products/services that will help me

12

Quality Monitoring Form Design Case Study

• Voice & Email quality monitoring form placed heavy emphasis on compliance

metrics i.e. security questions as well as metrics “we thought” were customer-

focused i.e. saying a customer’s name twice

• The organization was undergoing a transition from transaction based service to

relationship management


• Help deploy an organization-wide customer program for both internal & external

customers as well as guidelines that underpin the behaviors for customer-

centricity

• While deploying the program, we realized the current voice & email quality

monitoring form needed to be aligned with the organization customer initiative to

ensure consistency and integrity with the firm-wide initiative

13

H.E.R.O Program

• Hear and Respond Appropriately

• Ensure accuracy and consistency

• Respect & treat each other with empathy

• Own customer issues to resolution


• Own customer issues to resolution

• Redesigned the quality monitoring guidelines, evaluation forms & scoring

methodology to align with the firm-wide customer initiative

14

New Call Quality Monitoring Guidelines


New Email Quality Monitoring Guidelines


Tips for Creating an Effective Quality Monitoring Form

• Make the form easily updateable

– Customer needs change; product & services change; YOUR business changes

– I would reevaluate the quality monitoring form every quarter

• Make the form specific down to the skill & knowledge level of the agents

– Take an a subject area like “Listening” and break it down into smaller components

– Consider trending specific areas of your QA form to be used for future coaching and

training opportunities


• Develop the quality monitoring form based on the competency of the job

• Consider “graded” and “non-graded” measures

– There may be specific areas you want to grade to drive behavior change, but there may

be other areas that you want to note but the score is not relevant to driving the right

agent behavior

– Example: Will the customer choose to take their business elsewhere because the agent

didn’t use the proper greeting?

17

Tips for Creating an Effective Quality Monitoring Form

• There is no right or wrong way to score a call or email

– You do need to think through what behaviors you are trying to cultivate and measure

the agents against those

– You want to balance efficiency & effectiveness metrics

– Consider applying a weighting system to your quality component

• Think about what you call your quality monitoring form and QA process


– Anecdotal evidence suggests that agents perceive the QA program in different ways

based on the way the program is delivered; what the QA form is called

– Example: “Call Assessment QA Form versus “Customer Experience Form”

18




When Your Customer Speaks, You Better Listen!

Voice of the Customer Discussion

1. How many of you have a formal process for disseminating voice of the customer

insights to key decision makers & stakeholders? Please Explain

2. How many of you have dedicated operations resources devoted to voice of the

customer analysis and reporting?

3. How many of you marry quality assurance scores with voice of the customer


3. How many of you marry quality assurance scores with voice of the customer

results at the call center agent level?

…You Are Not Crazy If You Are Listening to Your Customers

“The voice of the customer IS NOT

in your head; it’s the ACTUAL

voice of the customer!”


voice of the customer!”

Voice of the Customer Benchmarking Facts

• Despite the economy, 55% of organizations have made zero cuts for customer

feedback initiatives while 19% have actually increased spend in this area

• High performing organizations are 18x more likely than low performing

organizations to increase customer satisfaction, and 45x more likely to increase

customer retention


• High performing organizations are 7x more likely than low performing

organizations to improve customer advocacy

• 3x more high performing organizations than low performing organizations enjoy

above-average performance in their ability to rate individual employee

performance based on customer satisfaction

Drivers & Strategic Actions for Implementing VOC


Business Context: Regional Online Bank Case Study

• Acquisition, share of wallet and retention are top priorities

• Execution of world class relationship management and seamless

customer service across multiple channels

• Organizational focus on customer churn

– Growing competition from other retail banks


– Customer service inconsistency

– Defend high value and most growable consumer base

• Were there quality improvement projects in our control to make a

difference in the attrition?

Methodology: Regional Online Bank Case Study

• Sent out a random email customer satisfaction survey to 21,673 customers

• Random sampling excluded any customer that received a survey in the previous quarter

– Included 5,000 high value customers

• Survey questions were targeted to 5 specific areas

– Product/Service


– Product/Service

– Account features

– Customer Service

– Repurchase Intent

– Customer Advocacy

Initial Results: Regional Online Bank Case Study

• Satisfaction with Customer Service

– Secure e-mail support – 33.2% rated 5 followed by 29.3% rated 4

– Timeliness of response – 29.8% rated 5 followed by 27.9% rated 4

• Frequency of Use of Service Channels

– Secure e-mail 47.3% use occasionally followed by 31.2% who seldom use


Initial Results Led to an Internalization Effort

• Strategic decision to internalize secure e-mail support

– Better, faster, cheaper

– Opportunity to “own” the customer experience by delivering on brand

promises and reduce response time volatility

• Completed the internalization within 90 days

– Developed the business case and ROI model

– Hired 24 Customer Fulfillment Associates


– Hired 24 Customer Fulfillment Associates

(CFA’s) and 1 Team Lead

– Developed an augmentation strategy

Improved Email Response Time & Quality of Service by 82%

• Drastically reduced the secure e-mail response time

– March – 52.60 hours

– April – 26.60 hours

– May – 9.79 hours

• Initiative led to other strategic and expense management initiatives to

improve customer service


improve customer service

–Internalized Tech Support

–Internalized Security Channel

–Implemented an After Call Based Survey program

Post Call Customer Feedback Program

• Receive alerts in real time when the customer expresses a pain point

– Bank Contact Center and Outsourcer are copied on all alerts

– Team Lead from NetBank contacts the customer to resolve issue no later than

48 hours from the time the alert is received

– Once issue is resolved, Team Lead shares the information to customer care

management team and outsourcer


management team and outsourcer

– Quality improvement initiatives are created to close gaps

– Agent coaching is administered when necessary

Three New Quality Metrics

• Two new value creation measurements have been created

– Contact Center ROI

– Agent Peak Performance Index

• Contact Center ROI

– Measures the value creation/destruction of customer interactions


– Triangulate measurement view; overall outsource relationship and center by

center

• Contact Center ROI Calculation

– {[% Delighted calls x Customers served) x Avg. Revenue per customer] minus

[% Dissatisfied calls x Customers served) x Avg. Revenue per customer]} / Fully

loaded costs for the period x 100

Three New Quality Metrics

• Contact Center ROI Calculation Example

– {[.60 x 100,000) x 50] minus {.05 x 100,000) x 50]} / $2,083,33 x 100 = 132%

• Agent Peak Performance Index

– Each agent that a survey is conducted is scored by the actual voice of the

customer

– If the index is falling, it raises a red flag to supervisors/trainers for additional


– If the index is falling, it raises a red flag to supervisors/trainers for additional

coaching/training

– If the index is rising, it demonstrates which associates are providing customer-

centric support

• Agent Peak Performance Calculation

– Agent ROI x Accuracy (QA Score) / % Delight Treating Customers as Valued

The ROI of Voice of the Customer

Captured by monthly VOC

Provided by marketing


227% ROI within 12 months of implementation (Aug 05 - Aug 06)

Formula for calculating Contact Center ROI

Voice of the Customer Steps to Success

• Define performance metrics for measuring voice of the customer effectiveness

• Proactively inform customers of changes made as a result of customer feedback

• Tie voice of the customer results to employee performance where applicable

• Make voice of the customer results part of your leads/supervisors/managers

incentive compensation

• Analyze customer feedback results to create actionable insights

• Create a process to enhance quality metrics over time


• Create a process to enhance quality metrics over time

• Where applicable, involve, incentivize and hold your outsource vendors

accountable results




Agent Empowerment & the Effects on Quality

I Want You to Walk Away With One Simple Truth…..

•“…..Be Afraid of Customers Not Competitors”


•“…..Be Afraid of Customers Not Competitors”

•Jeff Bezos, CEO, Amazon.com

Types of Agent Empowerment

•Agent Empowerment in Hiring

� 1 in 4 centers that empower agents to assist with hiring have a

formal hiring task force.

�Of those centers, 77% report a “positive” or “very positive” impact

on agent engagement and retention

•Agent Empowerment in Quality Assurance and Coaching

� 41% of centers surveyed reported their more experienced agents


� 41% of centers surveyed reported their more experienced agents

serve as quality monitoring assistants

� 89% of centers that utilize peer monitoring helped improve the

overall engagement and retained skilled tenured agents

•Agent Empowerment to Manage “Moment of Truth” Interactions

� 58% of centers that empower agents to make non-routine decisions at the point of

interaction positively affected customer satisfaction

36

“Agent Empowerment” 2008 ICMI Research Report”

The Conflicted Contact Center

In a recent benchmarking study, contact centers focused on providing customers an

“experience” versus treating customers as a “transactions” measured “Customer Satisfaction,”

“Total Cost of Customer Support” and “Average Call Wait Time” as the main key performance

indicators (KPI)

60%

70%

80%

90% Best In Class

Average

Laggard


0%

10%

20%

30%

40%

50%

Customer SatisfactionAverage Call

Wait TimeTotal Cost of

Customer Support

“The Conflicted Call Center: Customer Experience versus Transactions” Aberdeen Group, March 2007

“Moments of Truth” Defined

•Moments of Truth

�Pivotal moments of

customer dialogue that

have the ability to create

or destroy customer

value

� Typically critical and

unpredictable

�Customer is emotionally

high

Custo

mer E

ngagem

ent

Surprises, trials and

tribulations

(Contact Center Agents making

non-routine decisions)

Predictable customer

lifecycle events


�Customer is emotionally

vested in the outcome

38

Custo

mer E

ngagem

ent

low

low high

Process Standardization

Threats to cost efficiency Business as usual

• Customer Experience

Attributes

�Agents are

knowledgeable about

all customer

interactions

regardless of channel

�Decisions regarding

problems are made at

Contact Center Experiences Influences the Brand Promise


problems are made at

the point of interaction

“The Call Center’s Impact on Company Brand and Image” by Dr. Jon Anton and Anita Rockwell

Establish an Empowerment Service Level Agreement

•Objective SLA

�Approval from Legal / Compliance

�Grant additional authority to conduct certain types of transactions

�Make sure system changes match SLA

�Routinely review reports to ensure compliance

(make changes as needed)

� Focus heavily on quality assurance and monitoring


•Subjective SLA

�Mistakes may be made on the way

�Communicate the value of the customer

� Focus heavily on quality assurance and monitoring

�Reward the right behavior

(even though it produced the wrong result!)

40

Integrity + Intent + Capabilities + Results = TRUST

Alignment of Performance Management Systems

•Quality Assurance should evolve its measuring criteria from compliance to internal

conformance to behaviors that drive customer satisfaction

– “You said my name like 4x’s on the call. Whoop-Dee-Friggin-Doo! I still don’t have my

issue resolved! Get me your supervisor!” - Crazy “But Good Point” Customer

•Rewards and Recognition programs should motivate, recognize and incentivize

agents that demonstrate “going above and beyond for the customer”

– It’s important to define what this means to your center or organization


– It’s important to define what this means to your center or organization

• The inbound / outbound call center process is one of emotion. Partner with Training

to develop targeted soft skills training

– Do you know there are actual reports of customers getting physically sick from poor

service?!

41

Summary

�We are no longer in the service economy but have entered into the dimension of the

experience economy

�Customers are the most valuable (yet scarce) asset to any organization

�A shift is required for contact centers to function as strategic assets.


Let’s Keep in Touch

Art Hall

– Alvarez & Marsal Business Consulting

3399 Peachtree Road, Suite 1900


3399 Peachtree Road, Suite 1900

Atlanta, Georgia 30326

– [email protected]

– Direct: 404-260-4152

Mobile: 404-759-9158