John DiJulius

Thursday, 25 September 2008 20:00

World-class training

Acommon misconception is that the only way to get better people is to pay more than everyone else. There are many great examples of world-class companies who do not necessarily pay better than their competitors. In fact, employees at Disney, Starbucks and Nordstrom are hired from the same labor pool every other organization uses and are paid the going rates. The real reason why the customer service is so good at a company like Disney is how well they are transformed into Walt Disney cast members during training.

Remember: In most cases, the most recently hired, least-trained, lowest-paid employee deals with the customers the most. What determines the consistency of delivering the experience is the quality of the systems and training that every new and existing employee goes through.

Inadequate training is definitely the biggest underlying reason for the inconsistency and scarcity of great customer service. Companies skimp on training because it costs money. But companies that invest in customer service by training their employees reap great financial benefits.

Why are you trusting a $100,000 client with $100 worth of training?

There are two types of training when it comes to training new employees: hard and soft. Hard training focuses on the basic functions of the daily job while soft training focuses on customer-specific issues, such as dealing with an upset client or acquiring customer intelligence. Stop and examine your own training for new employees and notice the percentage of your hard versus soft training.

More than 90 percent of businesses spend less than 10 percent of their training on soft methods. It is the soft training that allows front-line employees to deliver personalized service, which creates a memorable experience, emotional brand capital and, ultimately, repeat business. If you do the math on your own training and find that your business dedicates just 10 hours of new employee training to soft skills, then that means you are trusting that a $10 an hour front-line employee can consistently satisfy one of your $100,000 customers with a mere $100 worth of true customer service preparation.

To be a world-class customer service organization, your training should include the following:

  • A company orientation that covers company policy and the company’s history

  • The functional components of the specific job

  • The operational procedures of the job

  • All technical training, including product knowledge, use of equipment/tools, software and other technology, and scope of services

  • Experiential training on soft skills, especially how to create relationships and personalize encounters, how to prevent customers from feeling like transactions, and customer recovery techniques

  • On-the-job shadowing

  • Testing and certification, including extensive testing on experiential skills

Map the customer’s experience journey

Identify all the significant points of interaction — called stages — that your customers may have with your company and get your employees involved in helping create what those stages should look like. You then break each stage down into four individual components:

  1. Service defects: all the things that can ruin the customer’s experience at this stage

  2. Operational standards: all the tasks or jobs for each stage

  3. Experiential standards: the actions that will create an exceptional experience

  4. Above-and-beyond opportunities: common situations that front-line employees should recognize and prepare for in order to make a customer’s day.

Once you have your final version of service defects, standards and above-and-beyond opportunities, you can create a training manual that all new employees get trained and tested on during their first two weeks with your company.

Action plan

It is imperative for companies to ensure that every employee truly understands what the organization’s customer experience promise is. The customer experience promise is what the organization is supposed to deliver to customers, consistently, at every stage of their interaction.

Organizations need to make sure their customer experience promise is structured in such a way that all employees learn, understand and execute it.

JOHN R. DIJULIUS is the best-selling author of “What’s The Secret? To Providing a World-Class Customer Experience.” (Wiley, May 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

Wednesday, 26 December 2007 19:00

Mixed message

Executives have difficulty investing in customer service and training, but they often will throw millions of dollars at marketing, advertising and branding campaigns that create an inconsistent experience to what the customer actually experiences. And here’s the kicker: Nearly every market leader has the highest satisfied customer base and usually advertises the least amount.

Instead of following the pack, take 50 percent of your marketing budget and invest in dramatically improving the level of your organization’s customer service. You will see a significantly better return on investment than you were getting for your marketing and advertising dollars. Better yet, your customer base will turn into an unpaid sales force.

The customer’s expectations of service are so low in today’s business world that organizations have a tremendous opportunity to gain a competitive advantage by focusing on service. And whatever your business — retail, hospitality or business-to-business — it has never been easier to exceed the customer’s expectations by delivering a memorable experience.

Aren’t sold yet? Consider the results of several studies that have been done comparing the top American Customer Satisfaction Index companies against the market, with regards to stock performance for the six-year period from 1997 to 2003, a period where the stock market was both up and down.

The top customer satisfaction companies (based on their ASCI scores) outperformed the

Dow Jones by 93 percent, S&P 500 by 201 percent and the NASDAQ by 335 percent, revealing that superior customer satisfaction pays off in bull and bear markets.

It’s hard to argue with the results. There are very few actions or strategies that you, as a CEO, can take that produce this type of financial return, but customer service is one of them.

In the accounting world, the economic value of satisfied customers seems to be systematically undervalued even though these customers generate substantial net cash flows with low risk. Firms that do better than their competition in terms of satisfying customers (as measured by ACSI) generate superior returns at lower systematic risk.

Every executive should know the correlation between the level of customer service his or her company provides and the bottom line. If customer service is that important, why don’t you represent it on the profit and loss statement or the balance sheet? There are line items for advertising, marketing, people development and entertainment, but there is usually nothing for customer service. Financial reporting seems to be in the dark ages with regards to how it recognizes the value of customer service and customer satisfaction.

Consider the case of Amazon.com, whose customer retention rate consistently hovers around 80 percent. Amazon’s typical customer is worth about five purchases. Just by Amazon improving its retention rate to 85 percent, that typical customer would now average seven purchases. When you multiply that extra two purchases by the average purchase price and then by Amazon’s 29 million users worldwide, you’re suddenly talking about a very significant amount of revenue.

It’s pretty conclusive that organizations that consistently deliver superior customer service generally enjoy repeat business, lower price elasticity, higher prices, more cross-selling opportunities, greater marketing efficiency and a host of other things that usually lead to earnings growth. It’s also been found to have a positive impact on employee loyalty, cost competitiveness, profitable performance and long-term growth.

The level of a company’s satisfaction can typically be an accurate indicator of future success. Author Joe Calloway sums up best: “If you want to see how a company is doing now, look at their current sales. If you want to know how a company will perform in the future, look at their current customer satisfaction scores.”

Your clients and customers will pay a premium for your product or service when you put an emphasis on creating relationships rather than commoditizing your wares. Organizations that deliver world-class service create loyalty and build a bank account of emotional capital with customers. World-class organizations are less affected by third-party conditions, such as escalating gasoline prices, mass mortgage fore-closures, real estate crashing, volatile stock market, what the Fed does with the interest rate or global events, as are companies who do not differentiate themselves through superior customer service.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

Tuesday, 26 August 2008 20:00

Secret service agents

Creating a world-class customer experience is about creating “secret service” systems that allow front-line employees to engage and interact with customers to personalize the experience by anticipating and delivering on their needs.

So the next time you hear somebody use the words secret service, don’t assume their talking about the government agents.

Out of curiosity, I looked up the definition of the government’s Secret Service.

Secret Service: Governmental service of a secret nature charged chiefly with the protection of the president, responsible for the collection, analysis and appropriate dissemination of intelligence.

Think that has nothing to with secret service as it relates to customer service? Actually, by substituting just three words, it fits perfectly.

Secret Service: Customer service of a secret nature charged chiefly with the protection of the brand, responsible for the collection, analysis, and appropriate dissemination of customer intelligence.

Customer intelligence is customer data (i.e., buying habits, personal preferences, where they live, etc.) that fuels secret service.

Many companies let this happen by chance. Typically, a few long-term employees create relationships with regular customers to get this, but you have a high degree of inconsistency when it is contingent on that. The best customer service companies train all their employees how to collect and use customer intelligence. A good system with the proper training allows even the newest employees to personally engage and recognize even those less frequent customers.

Secret service lawyers

Connecticut’s Carter Mario Injury Lawyers has grown consistently during the past five years, going from $2.5 million in revenue in 2002 to more than $8 million in 2007. Back in 2002, however, the law firm was stagnant largely due to low service aptitude. That is when Carter Mario, president and CEO, decided to buy out his partners.

“Our service culture had to change in order for us to differentiate from the rest of the pack and to survive,” Mario says. “We adopted a service culture that has enabled us to become one of the fastest-growing law firms in the state.”

One of the single biggest complaints in the legal industry from clients is poor communication between clients and lawyers.

“We made this the No. 1 priority in our office: client contact,” Mario says. “We guarantee we will return the client’s call the same day or lunch is on us. It is a nonnegotiable part of everyone’s job here.”

The management team at Carter Mario instituted a procedure for capturing information about each client in a format that allows everyone access. They were able to customize the software they use by adding a “secret service tab.” This tab contains vital customer intelligence, such as preferred refreshment, client’s eye color, birth date, spouse’s name, children’s ages, hobbies and even the client’s pet’s name.

They use it to execute what Carter Mario calls “drive-bys,” where a staff member makes a seemingly spontaneous visit with a client who is in the office just to say hello and say something personal.

“We have continuously received great responses from our clients, and a collateral benefit has been that our staff members doing the drive-bys really enjoy the responses they’ve received, and it pumps them up,” Mario says.

Altruistic secret service

My favorite secret service is when the customer service that is provided has no apparent hidden agenda. For example, my accountant dropped off an autographed picture of Notre Dame football legend Rudy Ruettiger personalized to my oldest son Johnni. I don’t recall telling him, but somehow he remembered that was my son’s nickname when he played youth football.

Secret service creates an emotional bond between customer and company that transcends the product or service. That feeling becomes sought after again and again.

Think what would make you stand out a little differently. When every other business is making pitches, asking for orders and never finding out what is important to a CEO, imagine what it would mean if you simply sent a gift that has nothing to do with what you do, or can do, for his or her business but demonstrates that you have genuine concern for the person and his or her business goals.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret,” the No. 1 business book for the month of June on Amazon.com. He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

Friday, 25 April 2008 20:00

The 10 commandments

There are 10 principles that all world-class customer service organizations have in common. Those 10 commandments are listed below in the precise sequence necessary for any organization to provide a world-class customer experience.

Service vision

Every organization that provides superior service has a strong service vision that creates a clear direction for everyone inside it. This is the underlying purpose of what you bring to the community and why your customers buy from you rather than from a competitor.

You must develop the service vision before anything else can take shape. It drives hiring, standards, training and leadership philosophies.

World-class internal culture

With a vision in place, create a world-class internal culture that attracts, hires and retains only those people who are capable of upholding the service vision of your organization.

This culture serves as your organization’s foundation and allows our service vision to become a reality.

Nonnegotiable experiential standards

Any success in achieving your vision relies on a set of experiential standards that allow your service vision to be of real value to your customer.

You do this by having standards that everyone must follow for each stage of the organization’s customer experience cycle. The standards result in employees providing a consistent, engaging experience that is unlike most competitors.

Secret service systems

Once you are consistent, you need to find ways to gather and utilize customer intelligence to personalize experiences by engaging and anticipating customers’ needs.

This can be accomplished by developing secret service systems that capture information on the front end and turn it into easily accessible information that enables front-line employees to personalize every customer’s experience.

Training

A service vision, standards and systems are worthless if you don’t have a way to ensure consistency.

Do so by creating a training program for all new and existing employees that consists of soft-skill training aimed at increasing service aptitude and providing team members with the knowledge and tools they need to deliver a world-class customer experience.

Implementation and execution

This is the area where most companies fail. Therefore, the implementation and accountability for the set standards and systems are every manager’s responsibility. Develop a process that allows the realistic implementation of your new customer service initiatives and systems.

Zero risk

Being able to anticipate your service defects and having protocols in place to make it right is the difference between good and great.

Every employee must understand the common service defects that can arise at each stage of the customer experience cycle and be trained and empowered to provide great service recovery. That way, when problems happen, your company is known to be zero risk to deal with.

Above-and-beyond culture

Create an awareness of the most common opportunities where employees can really deliver heroic service for the customer. Develop mechanisms to collect and redistribute above-and-beyond stories that constantly remind your employees of the power of your service vision. This can become a tremendous competitive advantage.

Measure your customer’s experience

Use a scientific method to measure your customer’s experience and satisfaction. It should provide benchmarks for performance in each department.

Your goals must be tied to a specific metric that allows you to measure how satisfied your customers are with you, whether you are keeping your service brand promise, how effective service recovery is and how well you stack up against the competition.

World-class leadership

World-class leadership starts at the top and provides the passion, inspiration and discipline necessary for all employees to deliver every day.

While this is the final commandment, it is the most important. It becomes the driving force behind being able to consistently deliver the other nine. <<

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

Wednesday, 26 March 2008 20:00

Ahead of the curve

When it comes to customer service, do you know the rating for your company?

Probably not, but that’s not surprising considering that most CEOs don’t know how to measure their customer-service-aptitude level (C-SAT) beyond anecdotal feedback. If you don’t know your C-SAT, it’s difficult to determine where your strengths lie and what opportunities exist to get your company’s customer service to the next level.

Listed below are the five levels of customer service. The defining characteristics of companies at each of these levels apply to all organizations, regardless of product or customer base.

Level 1 — Unacceptable

You are at the bottom of the customer-service curve. It is very difficult to do business with your organization. Your hours of operation are limited, policies are not consumer-friendly, and it is impossible to get a call returned. You probably don’t provide ample training to your team, and you are more worried about hiring bodies to fill your needs than concerning yourself with who are those people. The technical skills of your existing staff are limited to minimal product knowledge, and you compete by having the cheapest price or no competition. As a result, employee turnover is high at all levels.

Level 2 — Below average

Not surprisingly, your company is difficult to do business with. You may have stringent policies for things like returns or cancellations, and it is difficult to speak to a real person when someone contacts you. Training is limited to technical and operational activities. Turnover is high, only the owner or senior management has the authority to fix a problem, and management gets defensive with inconvenienced customers and little or no attempt is made to rectify the situation. As a result, your service is extremely inconsistent and totally dependent upon who is dealing with the customer.

Level 3 — Average

The good news is that your employees are technically proficient, your customer service is consistent, and you have flashes of above- and below-average service levels. Some employees will occasionally go above and beyond. However, training is often devoted to technical and product knowledge, and only managers have the authority to make things right for the customer.

Level 4 — Above average

Technically, your company is best in class. Employees perform some great acts but lack day-to-day consistency. Unlike lower levels, experiential training is provided, including soft skills, how to deal with customers and service recovery. Because of this, you are able to charge above-average prices. Internally, your company has a strong inspirational service vision, and above-and-beyond situations occur often. New employees receive solid training, and you have lower than normal industry turnover. All front-line employees have the authority to make the situation right for the customer.

Level 5 — World class

It is extremely easy to do business with your company. Policies are customer-friendly, and when they aren’t, front-line associates can override them. Technically, you are best of class. The full range of experiential training is provided; your employees are taught and tested on standards for every point of contact with the customer, including possible service defects and on how to identify above-and-beyond opportunities. In most cases, your company has certification training, which employees must pass in order to receive promotions.

Internally, you have a strong inspirational service vision, profile your customers and share guest information. Every department in your organization is aware that supporting each other affects the customer.

Great systems are designed and implemented. Customer-service training is constant. New employees receive solid training, and there is very little compromise when it comes to hiring only those who believe in delivering great customer service. There is a strong implementation process and follow-through on initiatives.

As result, you have low turnover, your company has a great corporate culture and a reputation for superior customer service. Typically, your prices are higher than the competition.

So how can you measure your company’s customer-service aptitude to determine where you fit along this curve? Drop me a line, and I’ll send you a link to a test you can take to let you know.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

Sunday, 24 February 2008 19:00

Apt to serve

What is the secret to how companies like Disney, Nordstrom and Ritz-Carlton get thousands of employees to consistently execute world-class customer service while most companies struggle with teams of 15 to 50 people?

The answer is simple — employees. You count on your team of people to deliver service, and often, there is a lack of service aptitude.

So what constitutes superior service? The answer depends on who you ask. Without proper soft-skill training, superior service is relative to one’s life experience. Where has he or she traveled? What has he or she experienced? What manners and code of behavior was this person taught at home?

Most likely, there will be a discrepancy between your vision of customer service and any new employee’s vision.

The good news is that service aptitude can be learned and improved.

At The DiJulius Group, we define service aptitude as “a person’s ability to recognize opportunities to exceed a customer’s expectations regardless of the circumstances.”

The key to that definition is the last four words — “regardless of the circumstances.” High service aptitude is not as critical on your slowest day of the week or on a day when everything is running smoothly, but true service aptitude is revealed in a difficult situation, such as when you are short-staffed or in a crisis or when service recovery is needed.

Think about it this way.

For months, you have been promising your spouse a getaway for just the two of you.

Finally, you are spending three days in the Bahamas. The two of you are sitting by the pool, ordering piƱa coladas and reading gossip tabloids. Life couldn’t be better.

Meanwhile, back at home, your company just dropped the ball on your platinum-VIP customer. The only person on the scene to handle the situation is your most recently hired employee.

Still having fun? Still relaxed? Unfortunately, the simple truth is that our most recently hired, least-trained and lowest-paid employee deals with our customers the most.

Although most people enter the business world with a very low service aptitude, it can increase dramatically with the proper training program in soft skills and with continuous training in customer service. However, most companies spend the vast majority of their training on the technical side of the job, usually because they are hiring reactively, filling an empty position with a warm body.

One of the best tools for measuring if an employee’s service aptitude is high enough to start interacting with a company’s customer is some sort of employee service aptitude test. We created our own called the E-SAT. It is composed of 50 to 75 multiple choice questions about the most common situations that may arise between the employee and their customer, ranging from non-negotiable standards, service recovery, and above and beyond opportunities to uncomfortable and awkward situations that he or she may encounter.

At our company, we administer the test before and after any new employee goes through his or her initial training. This way, it monitors how service aptitude has increased. We do not allow any new employees to start working in their actual position or interact with our guests without scoring a perfect 100 percent on the test.

The actual questions on this type of test will differ based on your company, its services and the position for which you’re testing or hiring. The important thing is that an E-SAT will help you ensure that your employees deliver the type of service you expect them to every time they interact with a client or potential customer.

But it’s not just the front-line employees who need to increase their service aptitude and require more soft/people-skill training. I have worked with hundreds of businesses as well as professionals, such as accountants, financial advisers, consultants, lawyers, programmers and doctors, all of whom are extremely skilled and trained technically but are not strong at customer/client services and knowing how to build relationships. Every employee — front line, administrative, professionals and, yes, your management team —needs some customer experience training.

So what is the service aptitude of your organization? Do you assume it is high enough or are you taking steps to ensure it is top notch by measuring it and training your team?

Look at your employees and you’ll know for sure.

JOHN R. DIJULIUS III is the author of “Secret Service: Hidden Systems That Deliver Unforgettable Customer Service” and “What’s The Secret” (due out April 2008). He is also president of The DiJulius Group, a firm specializing in giving companies a superior competitive advantage by helping them differentiate on delivering an experience and making price irrelevant. Reach him at john@thedijuliusgroup.com.

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