The statistic that 50% of new businesses fail within their first year is fairly well known. Ugly and scary, yes, but well known. And yet this gloomy statistic may encourage those who make it to day 366 to breathe a sigh of relief. After all, if you make it past year one, you're laughing, right?
Well, no; they aren't quite in the clear, yet.
It's kind of like a game show; once you make it past the first round, then things really start to get challenging, because an alarming 95% of businesses fail within their first five years.
Okay. What's Happening?!
This doesn't actually make any sense. In a business world that is overflowing with quality information -- one could argue that there are more educated business people around today than ever before -- why are nineteen out of twenty business failing within a mere five years?
Volumes of research and commentary has gone into this problem; and issues like lack of experience, poor location, and the rather ironic unexpected growth are just three of many reasons that give us some understanding here.
Yet underneath so many of these causes, if not directly beneath them then a few layers deeper, is a concept that businesses seem to overlook... until it's too late, and they become a failure statistic for some business pundit to analyze. That concept is customer service
Reinventing Customer Service
It's not that businesses don't understand what customer service is; they do. The problem is much more sophisticated than this -- or else it would be very easy to solve.
The root problem is, while businesses often understand that the goal of customer service is to achieve customer satisfaction (and then experience all of the pleasant consequences of this, such as more profit and market share), they often don't know how to achieve to this goal. They know the end, but they aren't aware of the seven steps to exceptional customer service.
The Seven Steps
1. Invest in soft-skills training.
It's unfortunate -- and often destructive -- that the term soft-skills even exists; because that very word “soft” can imply that these are non-essential, nice-to-have skills. Yet 95% of businesses failing within their first five years compels us -- if nothing else -- to reevaluate our assumptions; because obviously, there's a flaw somewhere, and it starts here with the concept of soft skills.
For starters, they aren't soft at all; they're foundational. And just like the foundation of a house or the chassis of a car must be built to withstand an enormous amount of stress and pressure, soft skills provide your CSRs with the capacity to do what you need them to do: to solve customer problems, to spot and exploit additional sales opportunities, and to build loyalty.
Once this is accepted -- that soft skills are as hard as any business skills can be -- the next step is to actually implement practical training sessions. Teach your CSRs everything that they need to know about communication effectiveness, call control, rapport, phone etiquette, conflict resolution, and so on.
Remember: building vision and developing strategy aren't the only functions of management; they must put their CSRs in a position to succeed. Unless soft skills (which aren't soft!) training becomes a core part of your knowledge capital, then they're failure really isn't their own to bear; it's a failure of management.
2. Get in touch with your customers' reality.
Have you ever noticed that some things seem so clear from the outside, yet from within, things become cloudy and confused? We often see this in politics, when we accuse -- often with good reason -- elected officials for being “out of touch with reality”. What seems like common sense to us just doesn't seem to filter into that bubble.
Bad customer service is almost ALWAYS a result of being out of touch with customer reality. It's really quite simple; and perhaps even too simple to grasp, since we're often in search of complicated answers to complicated problems. Here's the insight to memorize: customers like to be treated like they matter to you.
But wait--you do treat them this way already, right?
Do have an automated recording telling customers that their call is important to you... so important that you keep telling them this over and over that by the time they reach 10 minutes on hold, it actually becomes insulting for them to be told that they're important... when they obviously aren't?
Do you have CSRs who actually listen to find out what the problem is and what solution the customer would like, before they try and “resolve the situation”?
Do you have a checklist of all of the things that you personally loathe about customer service, and ensure that your business reflects none of these?
If not, then while you may be quite brilliant when it comes to the front-end of business -- making sales, increasing market and mindshare -- you're really undermining your success on the back-end.
3. Make customer service training ordinary.
Training sales people on new product or service details doesn't seem like an extraordinary task; in fact, it's so ordinary, that it's not seen as an event at all. It's probably not seen as anything; just regular, everyday business.
So why is training customer service such a big deal? Why does it require such fanfare and noise?
It doesn't! Cultivate a business culture within which customer service training is ongoing and, indeed, ordinary. Make it as typical a part of what you do as any other core business function. Why? Obviously, it leads to better trained CSRs. Un-obviously, it creates buy-in from the CSRs themselves!
By demonstrating that customer service training is important and essential enough to be “ordinary”, CSRs feel recognized. Instead feeling like an evil problem to be fixed (“we need to fix our customer service! Train them! Train them ALL! Mhahahahhahah!), they feel as if they're a part of an essential and valued business process (“of course we're training the CSRs this week... we always train, it's part of what we do as a company!”).
4. Make it real.
Three words that you never want to have associated with your ongoing, ordinary customer service training is: suspension of belief. It is counterproductive to train CSRs to solve problems that they cannot solve or, possibly, don't even exist.
Find out what your CSRs are feeling on a daily basis. Understand their pain points, and give them a forum to provide their honest feedback in a blame-free, punishment-free forum. Finding out from your CSRs what needs to improve is also severely cheaper than finding this out from ex-customers.
5. Enlarge your concept of service.
Traditionally, service was viewed narrowly as that slim channel between a customer making a phone call (or sending an email), and an employee called a CSR responding to that inquiry.
Of course, traditionally, 95% of new businesses fail. So the traditional view here has some problems.
Specifically, it has this problem: the definition of service must be enlarged to embrace all interface channels. Not just the formal customer calling the CSR. Everyone and everything that interacts with a customer -- current and prospective -- must be trained in customer service. The IVR menu. The website. The accounts receivable staff. The delivery person. The on-site technician. Remember: from a customer's perspective, these role distinctions are quite meaningless. They view the concept of customer service as a continuum that can quite easily change shape: today it's the delivery guy, tomorrow it's the website, next week it's the sales staff. And if any of these interface areas are untrained and ineffective, customers will make rather harsh and often immediate evaluations.
6. You can't fool all of your staff all of the time.
CSRs (and everyone else who performs the customer service function) carry around within them a little algebraic equation. It goes like this: if you treat me badly, and expect me to treat customers well, then this equation will not reconcile. There will be a discrepancy.
That discrepancy, in human customer service terms, is hypocrisy.
Customer service people will easily see the hypocrisy -- of one exists -- between how they're treated, and how they're expected to treat customers. If they're treated poorly, disrespectfully, or worse, then they will have trouble changing standards when they deal with customers. In fact, they'll likely treat customers the same way. Why? Simple: the algebraic formula will reconcile. You treat them bad, they treat customers bad, and equilibrium is restored to the universe.
Businesses lose a tremendous amount of internal credibility when they tolerate double-standards of service: one for their employees, and one for their customers.
7. Everyone smiles when they're winning.
When you're offering a highly demanded product or service, or you've done a great job with your sales and marketing end and customers are knocking on your door, it's often convenient to assume that customer service is also flawless. After all, things are going well, right? And everyone smiles when things are going well.
But as everyone knows, business is cyclical; do something well, and pretty soon, your competitors will do it just as well -- and will strive to do it better, faster, and cheaper, too. That's when the smiling usually stops, and where real customer service competence either shines or collapses.
Good customer service can save your business when things aren't going so well on the front-end. Ensure that you invest in your customer service training regardless of how great sales might be; and how much market share you may command for the foreseeable future.
Remember: exceptional customer service isn't just a part of those 5% of businesses that survive long-term; it's probably the best insurance policy business has ever known.
A Final Thought...
And though it's probably clear already, it won't hurt to add a final step: get SERIOUS about Customer Service.
Great customer service isn't some feel-good, sing-a-long presentation session that ends with a smattering of applause and people racing for their cars in the parking lot. It's a serious, strategic investment that requires focus and follow-through.
Indeed, this may still seem a bit unfamiliar. We're used to seeing sales as something that requires this kind of seriousness.
But remember... we're also used to seeing 95% of businesses fail within five years.
Be the exception to this statistic by becoming exceptional in customer service.
 Source: US Small Business Association