secrets to building a customer driven service platform

White Paper

HyperQuality, Inc.

Secrets to Building a Customer-driven Service Platform

Executive Summary

A truly customer-driven service platform allows a company to place a dollar value on customer

satisfaction, thus enabling management to tie financial results to customer satisfaction and employee

performance. The keys to building a strong customer-driven service platform include collecting and

managing the right customer and employee satisfaction data, including call monitoring data, customer and

employee survey results, daily internal metrics and then using a variety of advanced analytics and predictive

modeling techniques to bring everything together to track and predict the success of business and marketing

efforts.

For many companies, with the emergence of technology enabled Quality Assurance solutions, it makes

sense to leverage external resources for some or all of the process of developing a successful quality program

and building a robust customer-driven service strategy. The results can have a dramatic impact on brand

loyalty, day-to-day marketing efforts and the long-term bottom line.

Introduction

Many companies include a variation of the statement “Provide World Class Service” in their mission

statements. These same companies have well-planned Business Strategies and comprehensive Marketing

Strategies. But ask them about their Customer Service Strategy and you'll find it's often nothing more than a

bullet point in the mission statement.

When it comes to cost cutting or allocating new resources in the boardroom, how do customers and

customer service efforts compete? When a decision is made to move customer support offshore, close a call

center or reduce the workforce, the tangible cost savings may be obvious. What about the intangibles such as

the affect on customer and employee satisfaction? Does your company know how to calculate that profit or

loss of customer and employee satisfaction?

A company with a well-built customer service strategy has its own budget, action plans and

communication vehicles built around customer feedback as integral parts of the company's culture. A well

designed customer-driven service platform allows a company to place a dollar value on customer satisfaction,

enabling management to determine the exact loss or gain when customer satisfaction or loyalty declines or

improves. Only when a company ties financial results to customer satisfaction will the customer truly have a

“seat in the boardroom” and a meaningful place in the company's mission statement.

This White Paper will walk you through the key elements of building a strong customer-driven service

platform and show you how to measure your service strategy in a world-class fashion.

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HyperQuality, Inc.

How is your customer represented within your company?

When establishing a customer-driven service strategy, the first and most important thing to look at is how

your customer is represented in your company. For most companies, customers are represented by data

collected in many ways, for many reasons and by many different departments. Unfortunately, there usually is

not a single department responsible for pulling all the data together. A company with a strong customer-

driven service platform will have a “Quality Department” responsible for linking all the customer data the

company collects.

Pulling all your customer data together may sound easy, but first: exactly what key data is needed to drive

a customer-driven service platform? And where is all this data in your company?

4 key data points required for a well-built customer service platform

There are four key types of data required for a well-built customer-driven service platform:

1. Customer Feedback Data

2. Employee Feedback Data

3. Behavioral / Monitoring Data

4. Operational Daily Metrics used to run the

business

In many companies, various departments access this

data through static daily or weekly reports. Nowhere do

these data meet both analytically or operationally to show

the cause and effect of major business actions. Because the

data is not linked, it's difficult for a company to see how the

different aspects of operations are affected by one another.

In reality, each of the four data points reflects effective

“levers” that can be pulled to affect business or marketing

efforts. Over time these four key data points can be tied to

financial fluctuations and true Return on Investment (ROI)

analysis, which should be the long-term goal of a customer-

driven service platform.

Data rules! (But at your company, who “owns” it?)

It has been said, “He who has the data rules!” Ofte, the four key data points are owned by or kept in

separate silos or “fiefdoms”. Marketing owns the customer data, Human Resources own the employee

feedback, Quality owns the monitoring data and Operations creates and drives the daily metrics.

Unfortunately, fiefdoms tend to protect “their” data and can be unwilling to share or allow other departments

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Additional points can be included, but even the most basic platform should include these aspects

© 2009, HyperQuality, Inc.

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HyperQuality, Inc.

to control the analysis — impeding the development of a customer-driven service platform.

While other departments can and should take an active role

in the collection and interpretation of data, only one

department should be responsible for linking all the data

that will feed the customer-driven service platform: the

Quality department. If fiefdoms exist or the Quality

department does not have the analytical power to build the

linking service platform, then consider outsourcing the task

to a Quality company that specializes in building customer

service measurement platforms. By centralizing this

responsibility to the Quality department and partnering

with an focused Quality company, management can reduce

internal power struggles and allow the outsourced partner to

be the liaison between the “fighting” factions.

Consider leveraging external quality focused expertise

With the recent growth of larger scale monitoring and quality assurance solution companies like

HyperQuality, it is now becoming possible to outsource large portions of what were traditionally in-house

quality department functions. Enterprises are creating small internal quality teams, while outsourcing the

“heavy lifting” of evaluating calls, collecting data and continuing improvement projects including Six Sigma

efforts. The benefits of this emerging leveraged quality model include costs savings, improved performance

and access to specialized quality technology platforms, as well as third-party neutrality that appeals to

company management, regulators, partner call center operators and third-party sales providers.

The four primary quality operations to consider outsourcing include:

• Monitoring and evaluation of calls, chat, and email

• Customer and employee surveys

• Advanced satisfaction/loyalty modeling

• Continuous quality improvement efforts

Why leverage external expertise for the monitoring and evaluation function? Consider these questions:

1. Between company-owned (internal) and partner call centers, how many people are monitoring

calls?

2. Are you getting enough calls evaluated to drive change in employee behaviors?

3. Do your employees believe the results of the evaluation data?

4. How much are you paying for the internal Quality Assurance Monitoring (QAM) team and your

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The Quality Department should be responsible for linking all the data


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HyperQuality, Inc.

contracted partner QAM team?

5. How calibrated/accurate are these different QAM teams, especially your partner centers?

6. What kind of reporting are you getting from your internal and partner centers?

7. With these reports are you able to manage business performance through center improvement?

8. Is your company operating a…

a. Traditional Monitoring Model of multiple QAM teams that operate within the center, or

b. Decentralized Monitoring Model with the QAM team accomplished by coach-driven

monitoring with no internal QAM team, or

c. The new Emerging Centralized Model, a hybrid of the Traditional and Decentralized models?

If your company is like most, you are driving a Traditional model or Decentralized model, and snapshots

of your quality monitoring probably look like this:

• You're paying too much

• You are not aware if you're getting all the required monitoring and evaluation that is contractually

required from your partner centers

• It's difficult to get consistent calibration across different monitoring teams

• Reporting is skeptical and not effectively used by the center or the company

• Reported data is not actionable or has too low a confidence level to affect change at the employee

level

• You have a wealth of data but no way to link it because it is collected in several different formats and

for different reasons

If you see your company in any of these snapshots, consider the Emerging Centralized Monitoring Model

to reduce costs significantly and drive insightful actionable data which can be a catalyst for rapid change and

competition among centers.

The Traditional Monitoring Model

The Traditional Monitoring Model is one where the call center has a group of employees that are part of a

QAM team, often sitting in a special section of the center and monitoring live or recorded calls. Feedback is

provided to employees by designated QAM individuals or given directly by their coach and through reports or

an interactive dashboard tool.

The Traditional Monitoring Model works well if the QAM teams are calibrated with each other across all

centers and are conducting several calibration calls a week. The company must also have a robust reporting

platform that employees can access at any time and see how they are performing and where they need

to improve.

The challenge with the Traditional Monitoring Model is that as a company adds more centers, it becomes


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HyperQuality, Inc.

harder to calibrate the overall workforce. Management often does not have access to the wealth of behavioral

data and weekly reporting from the different centers. Sharing of significant data from one center to the next is

usually non-existent. Even if each center shares their data, if the data is not calibrated on a regular basis, then

the information could be self-serving on the partner's behalf. It is often not in the best interest of an individual

partner center to share information that might help their competing centers improve.

The Decentralized Monitoring Model.

The Decentralized Monitoring Model is one where there is no Internal QAM team in the center. In this

model the Coach or Assistant Coaches are assigned the responsibility to monitor several calls per employee

per week. They enter their results into a central database and that information is used to run the business. In

this model the coaches provide direct feedback to their own teams.

In the Decentralized model most companies also have a headquarter QAM team responsible for

monitoring center performance. This model works best when there is a strong data link between the

headquarter QAM team and the center coaches, providing coaches are able to focus their time on targeting

systemic problems. However, when it comes to improving individual performance the coaches must ensure

that they monitor enough calls and have good communication skills to transfer information to improve the

employee's performance.

The challenge facing the Decentralized Monitoring Model is very similar to that for the Traditional

Monitoring Model consistency in calibration of accurate standards is difficult. Now instead of one Internal

QAM team to calibrate you have as many as 20 to 40 individual coaches or assistant coaches all working

different schedules. These coaches are also reporting on their own team's results, which restricts objectivity.

And as call volumes increase and service levels drop, it's tempting to shift quality monitoring employees to

help answer calls.

Outsourcing with the Emerging Centralized Monitoring Model.

The Emerging Centralized Monitoring Model is actually a hybrid of the Traditional and Decentralized

models and allows companies to replace the internal QAM team of the Traditional Monitoring Model and

outsource the required base call monitoring and evaluation requirements for coaches in the Decentralized

Monitoring Model. The Emerging Model puts actionable data in the hands of management and coaches, so

they can focus on improvement efforts and targeted coaching.

If a company has several centers they will often have an additional headquarter QAM team that keeps

track of the operations at a call center level. This is especially true if the business has many partner centers.

This extra layer of monitoring ensures the company has a true handle on the performance of each center.

In the Emerging Centralized Monitoring Model, a third-party company like HyperQuality evaluates all

centers from one core calibrated group of employees. This group is directly calibrated by company program


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HyperQuality, Inc.

managers and reports results on a robust reporting platform that allows anyone in the company to track

quality trend by all levels of the company, including at the individual employee level. This model can

eliminate the need for a large headquarter QAM team, as there is no need to “check the checkers.”

One of the challenges with this model is the perceived lack of accountability of an outsourced quality

company. It can be easy to blame a lack of improvement on not getting the right data from an outsourced

quality company. Your outsourced quality evaluation vendor must have a good calibration process along

with a great reporting platform, to eliminate this concern.

One of the challenges with this model is the perceived lack of accountability of an outsourced quality

company. It can be easy to blame a lack of improvement on not getting the right data from an outsourced

quality company. Your outsourced quality evaluation vendor must have a good calibration process along

with a great reporting platform, to eliminate this concern.

Customer and employee surveys: the cornerstone of a strong customer-driven service

platform.

Without an actionable and accurate customer and employee feedback loop, a company cannot begin to

understand the effects of their business and marketing plans, as well as company procedures, policies,

systems, products and services.

Every company should have a minimum of two types of customer surveys, relationship and

transactional. For budgetary reasons, many companies only use relationship surveys. Relationship surveys

track the brand image in areas such as price, value,

advertising, customer service, billing, etc. Surveys

are given at random to the general base of customers

with no point of reference to business activities.

Thus, a customer may have used a company's

product of service one week ago or one year ago.

With no point of reference to time or possible

recent interaction, the customer draws their answers

from collective memories or their experience or what

they remember from advertising or word of mouth.

This is often called “top of mind” recall, which is

driven by brand image. Relationship surveys are

good for tracking brand strength but very bad for

managing the day-to-day business decisions

affecting customers.

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With a proper customer-driven platform, companies can accumulate insightful data to effect change


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HyperQuality, Inc.

Transactional surveys measure a customer's experience within a given time frame of their interaction

with one aspect of a company's products, services or support. In other words, the customer has had sufficient

time to complete their interaction and form opinions. A good transactional survey breaks down the

customer's interaction into the key elements of the experience. With the proper analytical modeling, a

company can survey and track which aspects of the customer experience are causing the customer to be

satisfied (or dissatisfied) with the outcome of the interaction.

Transactional surveys drive operational changes. Because they are relevant to a specific experience at a

specific point in time, it is possible to tie survey results to customer satisfaction as it relates to weekly internal

metrics and financial performance. When building a strong customer-driven service platform a company

should consider linking all customer data from transactional surveys to both daily operation metrics and

relationship data in order to track the correlations to financial fluctuations in the business. Once this link has

been established, the company can truly have a service strategy that drives the business from a customer's

perspective.

Executing a fully functional customer-driven service platform is often a two-year journey, if a company is

starting from scratch. In the first year, the proper surveys are set-up to collect customer data. Survey data can

be combined with monitoring data to validate the impact of customer satisfaction on operations. After

collecting 12 months of data, it is then possible to run customer satisfaction and financial predictive models to

determine the link between customer and operational data. The second year is used to drive customer-based

operational changes on a large scale, as it will then be possible to link investments in customer service efforts

with cost saving efforts.

This two-year strategy doesn't mean your company can't start using survey data from day one! Within

three months of starting properly-designed surveys, it can be possible, with effective analytics, for a company

to accumulate insightful data to effect change. This can be accomplished with structural equation modeling

and a strong index survey scoring methodology. If you don't have these analytical abilities within your

company then outsource this function to a quality company.

Next, replicate the customer survey approach with employees.

Once a company has built an actionable and accurate customer survey process they will then have the

foundation to replicate the same process with employees. Almost all companies track employee satisfaction

it's an obligation that is often done once a year and many companies struggle with what to do with the data

they collect. Left up to their interpretation, without higher analytics modeling, some companies will fall back

on simply reviewing employee comments, and this is a mistake. Using employee comments with limited

Data analysis leads to misplaced action on events that may not in fact be driving employee performance or

attrition.

It's a fact that happy, engaged employees drive better customer service and profitable returns. It's also a


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fact that high attrition drives poor customer service, which can lead to lost customers. With a well-designed

employee survey platform, a company can link employee satisfaction to reduced attrition to improved

customer satisfaction to improved revenue. With the right modeling, a company can quantify the ROI of a pay

increase, commission increase, changes to employee benefits or other aspects of a company's culture.

Higher analytics & a note on the “Net Promoter” concept.

Many larger companies have very sophisticated marketing and research departments but still outsource

survey design, data collection and advanced analytics. For smaller companies there may be no marketing or

research department, and an outsourced partner is critical. Whether a company is large or small, it's critical

that sophisticated customer and employee satisfaction surveys are created properly from day one.

Some companies “dummy down” customer satisfaction data. In fact, some market research companies

admit there are much better ways of interpreting customer data but the companies they serve don't have the

discipline to understand and work with higher-level analytics. Recently, this has led to much “buzz” about

how a company only really needs one question to run their business. The “Net Promoter” theory uses a simple

mathematical calculation of customers who are willing to recommend your company to a friend. Every

company has “detractors” and “promoters,” and Net Promoter simply tells a company whether their number

of promoters is growing.

The major problem with the Net Promoter concept is the lack of perspective. Once you know your

business is shrinking and/or growing more detractors, how and where are you going to make changes to

improve? To identify what needs to be fixed, your business is going to need to ask more questions. You will

need more insightful transactional data and a higher level of analytics.

Are your surveys asking the right questions?

In order to ensure your surveys are asking the right questions, start with an “Ideal Customer Blueprint Map.”

This is a total exploration of the ideal customer experience for customers in your industry. The mapping

includes focus group benchmarks for industry norms and breaks down each aspect of a company's service

delivery cycle. It explores the articulated and unarticulated needs of your customers and tries to define

expectations and delights within their service experience. The final blueprint can then be applied to a

company's current business model to determine where there are weaknesses and points of competitive

advantages.

From the Ideal Customer Blueprint Map a company can then design a Blueprint Survey. In this process, a

comprehensive life cycle survey is created to capture every critical aspect of a company's service and sales

delivery. Through advance modeling techniques, a company can determine the impact of key business

activities from a customer's perspective. The blueprint survey lays the foundation for development of the


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ongoing customer satisfaction/loyalty survey. Without a blueprint survey, a company cannot be sure it is

measuring the right behaviors and placing the right importance on each aspect of their operations and brand

delivery.

If your company takes a survey off the shelf or copies a survey from JD Powers or another syndicated

survey, you may be missing a critical aspect of your business. It's possible the survey is adequate if there is not

a lot of change in your industry. However, with a generic survey, you may completely overlook that one aspect

of your business that differentiates you from the competition. This is especially true in employee survey

satisfaction, where questions are generic and are rarely customized to a particular business environment.

The outcome of a blueprint survey is easy to translate to management and employees because they can

see it came from customer's input, and the results will help show who is responsible for each action that drives

satisfaction. Employees will know what they control, how it's measured and how they can improve

their portion of the customer experience.

Avoid the temptation to “dumb down” customer satisfaction data.

One of the most common ways companies “dumb down” customer satisfaction data is by looking at

only “Top Two / Three Box” responses to key questions. This is where the business reports only the

percentage of responses to the 4 and 5 scores on questions with a scale of 1 to 5. When reporting top box

response in this way, a company can claim, for example, that “85% of all customers are satisfied or very

satisfied with our service.” Unfortunately, this is not an accurate or actionable reflection of the company's true

performance. Top Box reporting also does not reflect the total effect of changing performance within the top

boxes as well as downward movement of customers in the bottom two boxes. Any negative movement,

regardless of which box the customer rates, is information the business needs. It is critical for a business to

know how all customers are evaluating the business and how all customers are fluctuating both in positive

and negative directions.

A company that wants to build a customer-driven service platform must employ an index methodology

for analyzing and reporting customer and employee survey results. The index methodology survey process

calculates multiple critical survey questions into a single number that when operational will ensure that

customer feedback becomes part of the DNA of any company. A customized indexed methodology should

include relationship surveys, tracking the health of a company's brand, and transactional surveys, tracking

real-time operational performance. This index approach can take the single number calculation and break it

down into 5 or 6 secondary operational representing numbers that allows a business to drive improvement

that is accountable and actionable at all levels in the organization. This indexed approach also makes it easy

tocompare call center performance at all levels across your entire network. In addition, the indexed approach

also allows a company to track their performance to many national syndicated surveys like JD Powers and

American Customer Satisfaction Index. (ACSI) This approach is best outsourced in the beginning to ensure

buy-in from management, then brought in-house after the methodology becomes firmly established.


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Bringing it all together: the real power of higher analytics.

The final level of higher analytics involves bringing all the data together to track and predict financial

impact on business and marketing efforts. Using a variety of advanced analytics and predictive modeling

techniques, a good quality partner will be able to help your business determine where you are losing money or

brand position due to poor performance. This modeling and analytics will determine your business plan's

driving issues and will quantify losses or potential growth opportunities. All analytics will be actionable,

quantifiable and measurable. A robust platform can be built to track the day-to-day internal metrics tied to

customer satisfaction and the financial impact on business operations. Combining customer and employee

feedback data with monitoring data, internal metrics data and financial data will change your company

forever.

A mini case study illustrates the point.

Imagine you want to reduce the wait time on the phone for your customers because you believe they are

waiting too long and are dissatisfied with their experience. If your company had a robust customer-driven

service platform in place you would be able to analyze your data something like this:

1. To increase the speed of answer you will need to link wait time and headcount to the cost of X. Let

say in this example $650,000 would give you a 1 point improvement in handle rates.

2. This handle rate increase will give your company a .12% increase on your overall Customer

Satisfaction Index.

3. With the customer-driven service platform, you would know that a .12% increase in satisfaction will

net a .25% decrease in lost customers.

4. With a net present value calculation, you could determine that this .25% decrease in lost customers

translates to a net contribution of $3.2 million to your bottom line.

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With a robust customer-driven service platform in place, making decisions on difficult issues would be easier


Improve HandleRates 1%

[Cost $650 k]

Improve CSIby 0.12%

Reduce CancelRate by 0.25%[22k annually]

Increase MemberContribution by

$3.2 Million

Think about how this debate plays out in your company over the same issue or other issues such as: what

is the cost of lower customer service from an offshore center vs. an onshore center? What is the right wait time

for a phone call? What effect is your Interactive Voice Response system having on customer satisfaction? With

a customer-driven service platform in place, these subjects and more can be debated accurately and with a

clear picture of the connection between customer metrics and financial results.