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The Customer is always right

As customers become more demanding and willing to complain, emotional intelligence has emerged as a key skill for service staff. Jo Causon, Chief Executive of the Institute of Customer Service, looks at the challenges organisations face in recruiting, training and developing these skills.

Emotional intelligence has emerged as a key theme in recruitment, training and customer service through the convergence of a number of factors. On the one hand, customers have become more demanding and more likely to take action by complaining when they are dissatisfied. The range of channels customers can use to express their frustration has increased. At the same time, the pace and scale of change, and the pressures of continuing economic uncertainty have heightened the importance of customers’ emotional, as well as functional and rational needs. As a result, emotional intelligence will emerge as an essential skill for customer facing staff and organisations therefore need to act now to prepare and train their teams. In recent times the amount of problems UK organisations cause their customers has actually been falling, the proportion of customers who experienced a problem fell from17 percent in January 2008 to less than 12 percent in July 2012. But when people do experience a problem, they are more likely to make a complaint –the proportion of complainants has risen from 72 percent to 76 percent over that same period. However, this still means that one in four customers with a problem “suffer in silence”; they do not overtly complain, though they may of course take their business elsewhere. In a recent report published by the Institute of Customer Service, based on research from over 2,000 customer complaints, it emerged that the key reason why customers don’t make a complaint is because they don’t believe it will make any difference. Perhaps linked to this, issues around staff behaviour and attitude form a significant proportion of all complaints (31 percent ). In fact, ‘people problems’ were identified as being among the most annoying for customers, and the most difficult to resolve to customers’ satisfaction.

The high proportion of complaints related to staff attitude or competence magnifies the issue of skills shortages in customer handling, team working and problem solving experienced in many sectors of the UK economy. At the same time, customers are putting a premium on intuitive service, simplicity and transparency, a trend set to intensify according to the Institute of Customer Service’s recent report the future of customer service: a blueprint for 2020.Using a mix of environmental scanning and future scenario modelling, including input from customer service leaders of some of the UK’s top service organisations, the research suggests that in a world of increasing complexity, pace, and change, customers’ fundamental functional needs will not change significantly. However, their emotional needs will become more exposed and more central to the service experience. Perhaps counter intuitively, the role of emotional intelligence will increase as organisations use artificial intelligence to simplify and manage routine customer interactions.

The growing use of technology will actually make face-to-face interaction more highly prized as the primary method for handling complex or sensitive issues. These challenging conversations will require heightened levels of emotional intelligence, problem solving, interpretation and commercial acumen. Consumers have also become less tolerant of bad products, bad services and, crucially, bad service. Research from the Institute supports this, finding that customers who have had a negative service experience are far more likely to stop doing business with that company or share negative reviews with friends, whether in person or via social media. Similarly, a survey of customers in the banking, insurance, utilities and retail sectors found that two thirds of customers who had a good experience with a company have recommended the organisation to someone else. Roughly two thirds of customers with a bad experience have stopped doing business with the organisation, and a similar number spread negative word of mouth. Poor service can therefore be incredibly damaging from a financial and business perspective, each time a customer raises a problem with an organisation its reputation is at stake. When customers approach an organisation with a problem or complaint, the reaction they encounter at the first point of contact has a critical bearing on their subsequent satisfaction. The Institute’s research into complaints found that the most common response when a customer reported a problem was that the employee “seemed uninterested”, which occurred in 35 percent of cases.

However, where customers experienced positive behaviours at the first point of contact –such as an employee taking responsibility, listening carefully to the problem, and taking action immediately, there was a significant uplift in satisfaction. Indeed, customers who experienced only “good” behaviours gave an overall satisfaction score 36 points higher(on a scale of 1-100) than those experiencing “negative” or “bad” behaviours. The need for training. There are a number of practical steps organisations can take to prepare themselves to meet the needs of the customer of the future, as well as delivering immediate improvements in customer interactions and complaint handling. The first step is to identify the target segment or segments the organisation is aiming to serve and build detailed profiles. These can be used to inform development of products and services, channels of communications, and provide customer-facing employees with digestible profiles which aid their interactions with customers. A key feature of the future customer landscape is likely to be a growing diversity of customer segments defined by behaviour, lifestyle and tastes, as well as economic affluence. Many organisations are looking at “big data” solutions – the ability to process multiple datasets, to create insight.

But this relies on customers being prepared to share personal information. In the future itis likely that a growing number of customers will be willing to share information about themselves in order to access more personalised services but only with organisations they trust. Effective use of insight will also require not just the ability to gather, process and manipulate data, but a blend of skills including analysis, interpretation and commercial acumen to turn it into actionable insights. Recruitment is a second key step and is central to meeting the demands of the future customer. Where organisations are investing significant resources on improving their customer insight, it is natural that they should assess the extent to which their employees reflect the profile of their target customer segments. It is probably not practical or desirable to recruit exclusively in the image of a target segment, and there is no doubt that people of all ages, genders and cultural backgrounds can be equipped to deliver customer service. However, it is vital that organisations ensure that their employees have empathy and an understanding of their target segments, and particularly how their customers perceive and rate the service they receive.One of the key findings of the Institute’s research into the future of customer service is the importance of women as decision-makers, whether as customers, entrepreneurs or business leaders. This suggests that many organisations will see competitive advantage in employing women in key roles related to the design of products, services and customer experience. Recruitment is fundamental to customer service strategy. There are a number of tools organisations can use to help this process including psychometric profiling, competency-based interviews, and role-play scenarios. But the essential aspect is to recruit customer-facing people who have an instinctive desire and aptitude to help customers. Additional skills and behaviours can be taught or coached, but when the interaction at the first point of contact is so crucial to the customer experience, especially where customers have a problem or complaint – it is vital to identify people whose instinctive reaction is to listen to customers and seek ways to help.

One of the key challenges facing organisations is to embed consistent understanding and practice of emotional intelligence across their customer-facing teams. This is particularly relevant in large organisations where customer service staff may be spreadover a number of sites or territories. It is all the more significant because customer service employees are likely to encompass a broad range of people operating in a variety of contractual arrangements. This may include young people and students with limited experience of the workplace, employees working flexible hours to enable them to meet commitments such as domestic caring, and a growing number of older workers. One of the options to address this is accredited emotional intelligence training in a customer service context, with the objective of establishing a consistent level of understanding across the organisation, as well as equipping people with practical techniques to defuse and manage challenging customer interactions. It’s also vital that this is maintained and reinforced once initial training has taken place, through monitoring and coaching of customer interactions, sharing of good practice and team briefings which highlight topical or emerging customer issues and problems. Developing employees with emotional intelligence is arguably the biggest single thing organisations can do to reduce complaints and improve their ability to deal with them. Itis sometimes said that a complaint handled extremely well can result in a more loyal customer. This may be the case in situations where problems can be rectified relatively easily or quickly. But when so many complaints are concerned with staff attitude and behavior, and many complaints are not even formally recorded, emotional intelligence is a prescient way of reducing the cause for complaint and sensitively managing complaints at source. Organisations face a complex and dynamic set of challenges in meeting the needs of the consumer of the future.

Customers are becoming more demanding, less tolerant and quicker to reject organisations. There is a growing diversity both of customer segments and channels through which the public and organisations interact. The pace and scale of change is also accelerating, providing a range of new opportunities, but also creating stress and uncertainty for many customers. In this environment, customers’ essential needs are unlikely to change fundamentally –but the need for emotional intelligence and responsiveness will become a key differentiator in customer service. Those organisations who understand this and are able to embed it across their organisation, people and processes will be well placed to meet the needs of their customers – now and in the future.

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