Facilitating the Move to Web Self-Service and Optimized Customer Interactions

Career Center published in DM Direct Special Report
By Allen Bonde and D. Blake Cahill

July 19, 2005

Managing customer relationships, despite — or perhaps because of — technological innovations, continues to be a challenging endeavor. One basic tenet holds true and that is: not only does exceptional service promote customer satisfaction and loyalty, but it also provides an avenue for marketing new products and services. This opportunity is transforming traditional approaches to service, which also creates new challenges. How can companies satisfy customers who've come to expect 24x7, real-time service across channels that include the Web, e-mail, fax and telephone? Delivering high-end service is an expensive proposition that conflicts with the "lean operations" directives many companies are pursuing.

At the outset of 2005, companies listed "improving and lowering the cost of delivering customer service" as a key business goal. Web-based innovations gave rise to online self-service; and this seemed to be the definitive solution to improving service delivery while reducing costs. Helping customers to help themselves makes good business sense — especially when you can reallocate costly support personnel to service your most profitable business sector. It all adds up on paper, so why is customer service transformation proving difficult?

One of the biggest reasons is as simple as human behavior is complex — we're all essentially creatures of habit. Generating a brilliant self-service mechanism does not ensure customers will use it. Additionally, exuberance around the topic of customer analytics has not translated into a true understanding of customer behavior. Therefore, an iterative approach is essential to transforming your customer support experience. Knowing where to start, what customers expect, who in your organization has the expertise (and motivation) to drive change and how to measure results are all essential to a transformation that can bring tangible benefits to stakeholders. This piece examines the landscape of customer service transformation and outlines the five recommended steps to begin this critical journey.

Companies undergoing this transformation are finding that new service delivery vehicles are well suited to marketing new products and services. Furthermore, the additional customer touchpoints extend the reach of company and product-level messages.

The Role of Self-Service

With more than 200 million Americans online, and e-commerce spending doubling every three years, consumers increasingly prefer to "help themselves" and are demanding instant access to information, product data and online support. In response, 70 percent of large companies increased spending on dynamic CRM, including self-service and portals, in 2003 (Yankee Group), while 54 percent of large companies plan to spend more on Web analytics (and 40 percent on Web search) in 2005 forecasts (Forrester). As a key part of a multichannel strategy, customer self-service solutions offer value to both businesses, in terms of lower deployment and interaction costs and customers with more convenient and faster access to information, answers and the right service personnel. However, as the Allen Bonde Group's (ABG) research has shown, organizations need to address a number of issues, namely:

• How to leverage investments in existing CRM, help desk and other enterprise software solutions as well as organizational expertise and data (such as that stored in a data warehouse),
• How to leverage new channels and technologies to create opportunities for marketing, up-selling and cross-selling, and
• How to support both new (Web, e-mail, chat/IM) and traditional service channels, at a time when budgets are tight, and there are increasing staff shortages and high turnover rates within contact centers.

Self-service will be part of transforming your customer experience. But to be successful, your customer self-service initiative must integrate the right technology, business processes, and user adoption strategies. Organizations must also view self-service as part of an overall multichannel approach.

Requirements and Approaches

Optimizing your customer experience requires an understanding of user expectations, needs and roles. To deliver an experience that is optimal for the user and the business, it will also require an understanding of the present (and future) value of each customer. While this insight will allow you to offer specific customer "treatments," similar analysis can also define the right mix of interaction channels and the related infrastructure needed to deliver the optimal level of service.

From an infrastructure perspective, on-demand solutions have become the preferred way to deploy multi-channel customer service solutions. Other requirements include:

• True multichannel support (phone, Web self-service, e-mail, chat/IM),
• Embedded behavioral analytics, customer satisfaction measurement and reporting,
• A knowledgebase to capture expertise and procedures,
• Starter applications and vertical industry templates, and
• Integrated professional services, training and change management capabilities.

This type of integrated multi-channel customer interaction center is illustrated in Figure 1.

Figure 1. Behavioral analytics provides the core enabler for next-generation customer interaction center solutions.

With this foundation in place, there should be an iterative process of assessing customer needs (and feedback), improving and streamlining support processes, and applying analytics to optimize channels and self-service delivery. This results in better support, more information and lower costs. How to start this process and deliver value early and often can be summarized in the following steps.

Five Steps for Getting Started

Successful enterprise-scale transformation requires a focus on the people, processes and technologies needed to drive and embrace change. A practice-oriented approach to customer support has the potential to not only ensure successful technology deployment, but also build management support, encourage user adoption, and generate meaningful metrics to better understand and adapt to customer needs. The volume of high-profile "CRM failures" has taught us several lessons. First, overselling or improperly aligning efforts with business objects can be disastrous. Second, technology is a necessary enabler but certainly not sufficient to doing CRM or online support well. Third, without user buy-in and a model that is focused around the customer, most efforts are likely to fail — or at least underperform.

Effective process transformation and technology adoption are most likely to occur when the initial project requirements focus foremost on the people involved in the change. Using this philosophy, lessons learned along the way and best practices as a guide, we have developed five steps that help drive the transition to customer experience transformation.

Step 1: Understand User Preferences — and Market to Them

Transforming the customer support experience begins by understanding the needs of users: those providing service such as call center agents or field service personnel, and the customers doing business with your organization. While ideally we would like to provide a unique service experience tailored to each customer, a more practical and cost-effective approach is to begin by defining groups of customers, or "segments" along with typical roles, needs and the preferred channels for various types of interactions and requests. This knowledge can also be used to communicate new products and services along the channel preferred by customer segments. For example, a bank customer who is a multiple account holder typically opens accounts in a branch location, but they may prefer to view statements online, receive notices via e-mail, and consult with advisors via the phone. In this case, the mail notices are perfect for introducing a new offering.

For consideration, another way to perform segmentation is to assign a value to each customer, either in terms of current importance or future value (e.g., lifetime customer value) to guide how they are serviced and how it will be handled should they communicate dissatisfaction with their service or the possibility of taking their business elsewhere.

Step 2: Assess Efficiency of Interaction Channels

Whether you are extending an existing CRM solution, enhancing a Web-based support portal, or preparing a direct response campaign; assessing what infrastructure is already in place, how each channel is currently used and where there is the opportunity for improvement will provide a baseline for process and technology transformation. Determining the relative costs of interactions or transactions across various channels is also important. In practice, mapping existing applications, processes and resources can be done"top down via interviews with managers and stakeholders and bottom up via external analysis of the support experience, creation of use cases and even simulation and testing via performance monitoring tools. When preparing for self-service initiatives, another key step is mapping structured and unstructured data sources, and then deciding where a knowledgebase and/or search solution is needed to access and deliver this information directly to users.

Step 3: Align Channels and Processes

With an understanding of user segments and needs, along with channel capabilities and relative costs, there are several exercises that can provide the foundation for a multichannel support strategy and an optimized customer experience. One activity is to map common tasks (e.g., opening an account) to the preferred channel and related environments (e.g., within Web self-service, the user may prefer to use search, browse by subject or use an FAQ) for each user type, creating a matrix of tasks versus channels/environments. Note that the preference can be the user preference or the business preference — i.e., the most efficient or effective channel for building loyalty or gaining market share based on analysis of customer behavior, use cases, etc. After aligning users (and tasks) with channels, the service strategy may be focused on filling gaps such as service levels on certain channels, or creating incentives for one segment or class of users to move from an inefficient or poor performing channel to another. This is another area in which channel-specific marketing can help by driving incentives for change.

Step 4: Create a Transition Plan

Moving users from one channel to another or shifting the role of agents or other customer support staff to optimize the customer experience, often requires incentives, agent (re)training and a change management strategy. When creating and deploying enterprise wide self-service applications which offer new capabilities to end-users, some organizations appoint a "user adoption" specialist to ensure requirements are met — and that users try and continue to use new tools. Another key element of a successful transition plan is addressing escalation between channels. Ideally, organizations should plan to minimize escalations by optimizing self-service channels to reduce channel abandonment, using other online tools like e-mail or Web forms to capture problem descriptions, and improving agent knowledge via tools and better access to consistent content. It is important to note that providing effective Web self-service is more than deploying a search engine. In fact, according to Jupiter, while 90 percent of customers contacting customer service in the second half of 2004 did so via online self-service at least once, only 51 percent were satisfied with their (search-based) self-service experience.

Step 5: Measure and Plan for Continuous Improvement

Transforming your customer support experience will require a series of iterative steps. That's why we recommend organizations focus on quick wins, and apply analytics to monitor user acceptance, the effectiveness of various channels and even the "ROI" for each customer interaction. Taking this one step further and merging product and user activity data with built-in business intelligence offers organizations actionable recommendations that can be used to optimize service delivery, improve the customer experience and even create better products.

Putting it into Practice: A Washington Mutual Success Story

Washington Mutual offers one example of the powerful transformation that can result from a practice-oriented approach to customer interaction management. In 2000, Washington Mutual designed an initiative that would harness the power of the Internet — and the desire of many consumers — to quickly and easily access real-time information, including personal bank accounts, called Personal Online Banking.

Washington Mutual's goal was to reinforce the bank's earned reputation for superior customer service, and to deliver a consistent experience through a new communications channel. Washington Mutual understood that if it kept its focus on the customer — and if it had the right customer interaction management expertise — that the additional benefits of reduced customer support costs and increased employee productivity would follow.

And they have. On average, 65 percent of Washington Mutual's technical support is handled through a SafeHarbor-managed Web self-service site (a seamless extension — including look and feel — of the Washington Mutual Web site) to deliver over $6 million in annual savings based on assisted support reductions through effective self-service. Today, multiple support channels seamlessly serve over three million online banking users, and the usage, issue and other customer data collected has been fed back into Washington Mutual's processes, ensuring that the company maintains its customer service edge in the market.

The Bottom Line

Achieving true multichannel customer service is a journey rather than a destination. That's why having a defined strategy and iterative road map is essential to getting management support and creating solutions that customers will not only accept but also embrace. Creating a plan to leverage emerging self-service models and applications is a key part of this approach, as is how to best apply on-demand solutions.

Beyond the five steps for getting started we highlight in this paper, applying behavioral analytics, creating the business case for channel optimization, and driving the change needed to get users, agents and even IT staff on board are all important considerations.

Allen Bonde is the president of Allen Bonde Group, Inc. (ABG), a management consulting and strategic advisory firm focused on the enterprise software market and the impact of emerging business models and technologies. He can be reached via his site at http://www.allenbondegroup.com.

D. Blake Cahill is vice president of sales and marketing at SafeHarbor. Prior to joining SafeHarbor, Cahill led a 900 person multi-lingual call center organization at a major telecommunications company with responsibility for $400 million in annual revenue and significant increases in customer satisfaction. His background includes senior management positions at AT&T, Ameritech, Belgacom, ServiceMaster and SBC. He can be reached at blake.cahill@safeharbor.com.

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