Customer service – the parable of the plate spinner

April 20, 2015

Marketing guru, Theodore Levitt postulated that the “product” could be likened to four concentric circles.  Starting with the innermost circle representing the Core product, the three outer circles represent the Expected, Augmented and Potential product respectively.  In his article “Marketing success through differentiation – of anything”, he alsdisho concluded that what one customer might regard as product Augmentation, another might see as Expected.

It’s 35 years since the article was published in the Harvard Business Review and there is no doubt that the impact of competition and technology and the resultant rise in customer expectation has seen the migration of features that used to represent the Augmented product being regarded as the Expected Product and those of the Expected Product becoming part of the Core Product.

Product quality is a given these days.  So are such attributes as reliability of supply, competitive order lead-times, delivery-on-time and competitive pricing.  These are the  qualifying dimensions of any product or service and no supplier can perform below par on these attributes for any length of time.  In Levitt terminology they are all part of the Expected Product.  The real battleground between competing organisations is customer service and despite the growth in e-business, customer service invariably involves people.

My company has completed customer/client feedback surveys for all manner of organisations from large multinationals to boutique consultancies covering every type of business from freight forwarding to stock feed and IT.  There is always a high correlation between the respondents’ rating of the level of service they receive from their main contacts at the supplier (my client) and the overall Customer Satisfaction Index.  But it is one thing to achieve high indices, another to maintain them.  And to illustrate the nature of the challenge, I tell them about the Parable of the Plate Spinner.

customer service

In the beginning, there was a plate spinner who became skilled at spinning an increasing number of plates.

He was so successful that he was being asked to do shows every night and increase the number of plates he could spin simultaneously.  This got to be too much for him so he decided to teach others to spin plates.  Naturally, they were not quite so good as him but it enabled him to take the occasional break and when they all appeared on stage together, the results were truly spectacular.
customer service
But then things started to go wrong.  The number of plates to be spun kept on increasing and there wasn’t time to train the new plate spinners to the standard required.  Instead of a set number of plates being the sole responsibility of one plate spinner, a system evolved whereby several plate spinners shared responsibility for the same plates.  At times no one was certain who was responsible for keeping the plates spinning.  Last – but by no means least – they began to spin plates of greatly differing sizes and they found that large plates took up a disproportionate amount of the plate spinners’ time and resources – both to get them up and spinning and to keep them spinning without losing equilibrium.

When a large plate started to wobble, it would require more than its fair share of spinners to reset it and the only spinners that could be spared were those who had plates that were spinning well.

customer service

The result was inevitable.  Whether or not the efforts of the spinners to restore a problem plate to equilibrium were successful or not, other plates, deprived of their regular re-spin began to oscillate ominously and inevitably some fell from their poles, never to be spun again – at least not by this troupe of plate spinners.

The moral of this story is that when the quality of your customer service is of such a standard as to attract new customers, you have to increase the resources to provide the Core, Expected, Augmented and Potential product that they have been led to expect.  Furthermore, the standard of service given to new customers must not be at the expense of the established customer base.  Even the most stable plate will fall off its pole if you ignore it for long enough.

Always bear in mind the research by TARP (Technical Assistance Research Programs Washington DC) that showed that 68% of customers changed their suppliers because the supplier “appeared disinterested or indifferent to its customer’s needs”.

Graham Haines runs his own consulting practice Plans to Reality and has been conducting his proprietary customer feedback surveys for over 20 years.  The feedback from these surveys provides a key input into operational and strategic initiatives for improving the performance of any enterprise.  You can read about these surveys and others covering executives, employees and workgroups at www.planstoreality.com.au.

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What’s better – meeting expectations or exceeding them?

November 25, 2014

 

I guess the PC response to the above question is the latter but the recent completion of another customer feedback survey provides further confirmation that this is not the case.untitled

The client, in this instance, was a manufacturer and as is usual in these surveys, we asked their customers to rate the importance to them of “Order lead-time” and “Delivery-on-time”. In order to ensure consistency of interpretation, a sentence of definition was read out to each respondent after each attribute had been tabled.

The one for “Order lead-time” read as follows:

“How important to you is the time that elapses between order placement and order delivery?”

and the one for “Delivery-on-time” –

“How important is it that the products ordered arrive at the time you were given to expect?”

Out of the 15 supplier attributes measured, “Delivery-on-time” was in third position in the hierarchy with Order lead-time in ninth place. Of course, what constitutes “Delivery-on-time” will vary from industry to industry and market to market. At one end of the spectrum, we have auto industry production lines where delivery-on-time is measured in minutes to custom made furniture or ship building where delivery within the month forecasted would meet the client’s expectations.

As consumers, we constantly wrestle with these two variables. Would we prefer the dry cleaners to tell us that an item for cleaning will be ready next day at 9.00am – and it is – or promise us an hour’s turnaround time – and we sit in the shop for 15 minutes while the item is finished off? Would we prefer a 10.00am appointment with our GP – and we barely have time to select a magazine before we are called – or one at 8.30am the same day when our doctor is running 30 minutes late? Would we welcome the plumber who turned up a day earlier than agreed?

Yet despite the evidence to the contrary, my experience is that the majority of management teams place greater emphasis on reducing lead-times with the inevitable result that delivery sometimes meets the customer’s expectations and sometimes not. “If I know that the order turnaround time is two weeks, I can plan around that. I would rather be told Friday am and the supplier meets that expectation than promised Tuesday and the supplier delivers a day late”.

Indeed for many customers and clients delivering before the expected time is just as bad as delivering after. Take a transport company that delivers containers from the wharf. Delivering in the morning instead of the afternoon as promised could be a real headache for the customer if they have hired labour to unload it – or a supplier delivering a dangerous chemical earlier than expected and thereby exceeding the customer’s dangerous chemical storage licence.

The one downside about meeting expectations is the phenomenon of “expectation creep”. We see this consistently with organisations that have undertaken a series of customer feedback surveys with us. If our client establishes a reputation for delivering-on-time then even though the incidence of late deliveries represents an ever smaller percentage of the total, the performance rating for this particular attribute might nevertheless stay static at best and at worst even decline. Based on past performance, customer expectations have risen and whilst our client’s performance has also improved, a gap starts to appear between expectation and the customers’ perception of reality. Expectation creep is also driven by the fact that the customer’s rating is based on a comparison between the supplier’s current and past performance rather than that between the supplier and one of its competitors.

I always cringe when I read a Mission statement that includes the platitude of “exceeding our customers’ expectations”. That’s not what customers want. They want their suppliers, whoever they may be, to consistently meet their expectations. As for “under promise and over deliver” just shorten that to “promise and deliver – consistently”.

 


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