Building a Best in Class Service Business

Muhammad Ali – 1955

The importance of providing a Best-in-Class service business during these uncertain and turbulent times can best be illustrated by the following Customer Satisfaction Statistics:

  • 59% of your customers will leave if dissatisfied with your service support
  • 78% will repurchase when high quality service support is delivered
  • 53% will tell others about bad service
  • 16% will file a complaint
  • 82% will recommend you to others if service quality is high
  • A 5% increase in customer retention = 100% increase in profits
  • A 1% improvement in customer satisfaction = 3% market value increase

All of these validated metrics illustrate the importance of providing a World Class Service Operation for your customers. The competitive pressures facing equipment manufacturers signal more tough times ahead:

  • Most service executives will experience a decrease in their operating budgets
  • Decreases in travel, staffing and compensation can be expected
  • Contract renewals will become less “automatic” and more scrutinized in detail
  • Customers may look to “downsize” contracts and take on more risk
  • It will be more difficult to add incremental business
  • Almost all customers will expect the same level of service quality at lower cost

Considering the upside to Best-in-Class Post Sale Support, while understanding the issues faced, is critical to success. The following are a few of the key factors that should be used to transition your service organization and achieve many of the metrics listed above:


Focus on the Customer

The Service organization has a unique relationship with the customer. Customers are not threatened by their presence. They are not there to “sell” something. They are there to help the customer to utilize an expensive asset. They can gather intelligence like no other resource in an organization. They typically communicate with the customer more than anyone in the business. Utilize regular surveys for feedback and commit to follow-up and improvement. It leads to results as mentioned above.


Commit to Service Excellence

Most organizations give this factor “lip service”. They don’t have a real strategy to drive service performance. Spend the upfront time to derive a Vision for Service Support. Utilize Benchmarks to see how others drive success and performance. Ensure it’s consistent with the overall corporate strategy. Then implement an operational strategy using specific and measurable objectives to execute the plan. Use of Key Performance Indicators (KPI’s) will be critical to measure success in implementation especially when compared to Best-in-Class Benchmarks. Set goals for these indicators and drive achievement.

View your Service Operation as a Profit Center vs. a Cost Center

Many organizations will look at Service as a necessary evil. They understand that Customer Support is required post sale, but tend to focus more on the next new product introduction, marketing and sales strategies. Budget pressures will force businesses to compromise on resource allocation leading to the chance Service Support is short changed. Data shows that high quality service support can drive increased revenue and high profit margin when service is operated in this way.

Utilize Technology

There are exceptional tools available to take care of the customer. Service velocity is key to improved customer satisfaction. Remote support tools to interface with equipment is becoming common place. Predicting equipment failure prior to it occurring is becoming the norm. Access to that equipment remotely decreases diagnosis and response time. Recovery time in today’s environment demands to be measured in hours versus days. Additionally, field support tools to improve field engineer productivity have improved immensely. Wireless smartphones and PDAs, Cloud based Maintenance Management packages to communicate and log data, and integrated GPS services to improve efficiency are essential. Invest in technology to drive your performance.

Invest in Your People

In the past, customer facing support personnel were viewed as call handlers and technical experts. Driving a World Class service operation demands more… Field Technicians must be considered Field Professionals. They must dress and act professional. They require superior communication skills. They should to treat their role as if it was their own business. They must work as a team with their Field Sales and Marketing colleagues to communicate the needs of the customer. Investment in robust and effective training programs is essential to performance. In service, the product is your people, the quality of your product will lead to a Best-in-Class support operation.

By Denis Olson

Nov 24, 2017

Scorecard Deployment & Organizational Alignment – MEDRAD

The Pittsburgh Pirates – 1907

One of the keys to our success as a Baldrige recognized company was the deployment and company-wide embracing of our five “evergreen” corporate objectives. These objectives addressed the needs of our major stakeholders;

  • Shareholders/Owners
  • Customers
  • Employees

The five high level objectives were used each year to align all business units, department, and individual objectives to the corporate goals. These are the five objectives:

  1. Exceed financial objectives
  2. Grow the company
  3. Improve quality and productivity
  4. Improve customer satisfaction
  5. Improve employee growth and satisfaction
Each year specific SMART (specific, measurable, achievable, relevant, and timely) goals were attached to each objective and were measured, monitored, and reported on a monthly basis by senior management. We referred to this as our “Balanced Scorecard”. These goals were used to develop our corporate strategic plan which would then “waterfall” down to business units, to departments, and to individuals in the development of annual plans, objectives and goals at each level of the organization. The end result was a well aligned organization with all parts of the company working toward the same goals.

By John Tedeschi

Nov 17, 2017

Driving Functional Excellence – Best Practice Sharing

Grace Hopper – 1960

Most organization improvement initiatives are not industry specific but can be easily applied across many diverse industries. I have been involved with managing and facilitating the “Best Practice Sharing” sessions at a major annual music industry trade convention in the United States. The members of the music industry trade association included instrument manufactures and music retailers. The focus of these five full days of Best Practice Sharing is on helping the music retailers succeed in these very challenging times. Best practice sharing is a highly effective means to look across one’s own organization and beyond, to understand how “Best in Class” players have succeeded in dealing with similar challenges and opportunities. This can include colleagues and companies across the same industry and even other diverse industries. Specific to this music industry program, the keys to successful sessions include;

  • Selecting the most impactful and most relevant subject. This is confirmed by soliciting suggestions from the members – they know their current pain points or emerging opportunities.
  • Recruiting the best member experts for each subject. These can be “Star” retailers that have overcome specific obstacles and are willing to share their experiences. It can also be industry experts that have specific subject matter expertise.
  • Providing guidance on presentation content and format. Making sure that each presentation addresses the specific topic and offers real value. It is also important to ensure that templates are consistent and the length meets the time requirements. Additionally, it is critical to work through any special audio or video requirements to avoid the dreaded “technical glitch”.
  • Efficient facilitation of each session. Making sure presenters get on stage in time, that everything needed is present and working and that the presenters finish on time.

A critical element in ensuring you understand the effectiveness and impact of the Best Practice program is surveying participants after each session to measure the value and satisfaction of the subject, content, and presentation. The results can be truly enlightening, especially when comparing across different sessions and year over year. Using this information effectively is the key to understanding how to drive continuous improvement and making sure next year’s sessions are even better than the last.

By John Tedeschi

Nov 17, 2017