When implemented correctly, customer-focused business strategy has great potential to dramatically improve your bottom-line.
Your team must do more than simply meet expectations in a competitive marketplace. You must create a customer experience that propels your business forward. There are three essential values in a customer-focused business strategy that excellent leaders consistently manage well: (1) trust and credibility, (2) needs and opportunity awareness, and (3) responsive problem-solving.
Trust and Credibility
Fill in the blank: My customers expect __________________.
Your brand develops trust and credibility when customer expectations are, at minimum, being met. What do people expect? They expect timeliness; they expect accuracy; they expect to be heard, and they expect to leave happy. But where do customer expectations come from? Customer expectations come from previous experiences—both experiences with your brand and experiences with your competitors. If they have replaced one of your competitors with you, or are contemplating doing so, they will absolutely be comparing their experiences with you with those of your competitors. The bar has already been set at some level for many of your customers, and if the bar is not being met they are not going to be satisfied.
Your customers also experience great customer service from other organizations that are not your competitors. They may have nothing to do with your product, service, or industry at all. Because the world has evolved into a customer-focused environment, people have a certain level of customer service expectation overall. Their previous experiences affect their expectations of every organization from which they receive services, including your organization. Do not overlook how other organizations outside or within your industry are developing and managing customer focus to gain insights on customer satisfaction gaps that could result in a competitive advantage.
Customers also develop expectations from your own marketing and sales department. Your market communications—brand promise, advertising, content, and direct communications—all work together to bring customers in and establish an initial impression and a presumption of the service that you should provide for them in the future. These communications must align with the reality of your organization’s ability to deliver on these expectations and your brand promise. If your marketing and sales departments are making promises that your organization is not able to fulfill, you may be dissolving your brand’s trust and credibility in the market. In fact, once a customer is lost, it is very hard to win him or her back.
Needs and Opportunity Awareness
Think about the most common complaints you hear within your organization. These are easily identifiable patterns and may indicate where your organization is not keeping promises that were made to your customers. Think about how you can put a plan in place for dealing with these predictable problems that surface over and over.
The airline industry is a great example of how leaders can create an opportunity out of a predictable problem. On very popular routes, airlines have more demand than they have seats; unfortunately, customers who have paid for the seats sometimes do not show up. The reason often is because their plans changed at the last minute or because the airline’s incoming flight was not on time. When this happens, very popular flights have flown with empty seats that cost revenue for the airline. In response to that situation, airlines deliberately overbook some flights.
For the most part, overbooking flights works because people do not show up or cancel. But airlines also sometimes have unhappy customers who arrive at a gate only to find out that they have no guaranteed seat, even though every one of those customers paid for a ticket.
So how do the airlines handle this predictable problem? They each may handle it differently, but generally, they pay people not to get on the overbooked flight. Gate agents can often be heard enticing willing passengers take a later flight in exchange for something. The minute they anticipate a seating problem, they start making announcements like, “We have good news. We are in an oversold situation. A lucky person is going to get a free round-trip ticket to any place he or she likes and an upgrade on the next flight out. If you would like to volunteer, please step up.” This approach is a whole lot better than waiting until the very end, hoping that someone will not show up at the gate.
Of course, there is some cost associated with this solution for airlines, but the cost balances out when customer satisfaction, loyalty, and value are factored in. With your predictable problems, the resolution may have some cost associated with it, but if you truly believe in the value of a loyal customer, the lifetime value of repeated purchases, and the value of a good reputation, you can see the value in developing solutions for predictable customer problems.
Because you will not be there for every single customer problem that comes up, the logical next requirement is to teach your employees how to solve customer problems effectively and with competence and empathy. Predictable problems present an opportunity to create a plan, and then your employees need to be trained to use that plan. It is true that you cannot train people in every situation—not all problems are predictable. For unpredictable problems, you need to train your employees on effective problem solving, and then empower them to do whatever it takes to solve the problem.
Responsive Problem Solving
Rather than risking that, they empower employees with a pre-approved budget to solve the problem without needing to aggravate the customer further by waiting for approvals for solutions. They can just fix the problem.
On average, if a customer’s complaint is effectively addressed, the customer will tell six or more people about their positive experience. But if their complaint is not handled properly, they will tell 15 more people about it. In the meantime, only one out of every 26 unhappy customers will complain to the organization; most will simply leave or never return.
For many organizations, dissatisfaction can lead to negative viral postings potentially read by a much wider audience; however, most of the real danger of customer dissatisfaction is hidden from view, so do not become complacent. Do not be afraid of customer problems but rather seek them out through surveys, reviews, and direct outreach. Poor customer reviews are an opportunity to improve, and the capacity to solve problems is what makes a manager a successful transformational leader.
The main principle in solving customer problems is to treat the person, then the problem. And the sequence of that is extremely important. By treating the person first, you can defuse anger and give him or her a chance to settle down so that you can solve the problem effectively. Skipping that step in your eagerness to immediately solve the problem might make the situation worse; by the time a customer has gotten angry enough to complain to you, the customer is probably emotional about the situation as well.
Another beneficial approach to resolving customer service issues is the widely known feel, felt, found technique. When a customer expresses concerns or objections, well-trained team members can show empathy, affirm any concerns or objections, and then ease the customer into moving beyond concerns. The first step is to acknowledge that you understand how the customer currently feels, then acknowledge that others like them have felt that same way in the past. Those two steps establish the feel and felt parts of the technique. The first shows empathy. The second authenticates the customer’s perception or concern by relating the customer’s feelings to the past perceptions or concerns of others. The third step can help customers see themselves moving forward with your products or services because of the implication that others have found your products or services to be beneficial, valuable, or better than expected. For example, a well-trained member of your team can point out that other customers have found value in the product or service. They might say, “When others did their own research (or experienced the product or service) they found that it was a valuable transformation from the process they were using before,” or something similar.
Focusing on your customer produces a direct impact on your organization’s bottom line. Organizations are far more profitable when they have a loyal customer base. Customers who will repeatedly choose you over competitors are also those who advocate for you to other potential customers in their networks. It’s worth the effort to please customers because they have the potential of bringing you more loyal customers at a much lower cost of acquisition. Delivering on your brand promise develops trust and credibility. Customer problems happen for every brand, but the ability to consistently assess needs, resolve problems, capitalize on opportunities, and develop trust makes your brand credible.
Distinguishing your company or organization based on the customer service that you provide requires customer-focused decisions or actions. Those decisions or actions depend on three intangible and essential ingredients that you can enhance, especially through practical training: (1) trust and credibility, (2) responsive problem solving, and (3) awareness of customer needs and opportunities. Managers who excel in this key competency are doing more than boiling a few soapberries with dried gooseberries. Customers expect more, and smart leaders will develop teams that are empowered to astound their clientele.
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Core Competency: Develops Customer Focus
Develops and sustains productive customer relationships. Gains insight into customer needs and opportunities, and delivers solutions to exceed customer expectations.
- Trust and Credibility: Builds strong internal and external customer relationships by following through on commitments
- Responsive Problem Solving: Anticipates and delivers effective and timely solutions to customer problems
- Needs and Opportunity Awareness: Proactively identify opportunities that benefit internal and external customers
The Leader’s Toolkit
Secret shop your competition and yourself. Review the results with your team and create actions to improve your customer experience. Follow up a few months later by secret shopping yourself again and audit the results—has the customer experience improved?