Miles to Go: Customer Service's Unfulfilled Journey to Value

Co-Authored with Lauren Villeneuve (Senior Director, Advisory) and Jonathan Schmidt (Senior Principal, Advisory). 89% of Customer Service and Support Leaders agree that being a Value-Driven Service and Support Organization is the most relevant trend over the next 12-18 months. As Service and Support leaders, we know we have a lot of potential value to offer. Two years ago, in our 2021 Leadership Vision for Customer Service & Support leaders, we highlighted how Service and Support organizations had only scratched the surface of delivering value, but that our traditional view of customer service was holding back. We presented opportunities to grow the business by driving loyalty and revenue, and highlighted how organizations would be rewarded for preempting issues and engaging with customers more proactively. But are we really taking the opportunity in front of us?  Think about the value you delivered in 2021 and ask yourselves how much you’ve moved the needle since then. Do we have lots of new value to demonstrate?  We’re A Long Way From Fulfilling Our Potential We discussed this with fellow Gartner experts and would argue that most organizations have made limited progress to date against this potential. We also noted that, on the whole, the position of B2B and B2C organizations does not vary greatly. So, where would you place yourselves on the graphic above? Ultimately, we are not yet convinced that Customer Service and Support leaders fully recognize the potential that their function has to offer, how to deliver against it, nor how to “sell it” internally to gain wider organizational support. But the pathway to delivering the largely untapped opportunity shouldn’t be seen as an insurmountable challenge.  Five Steps toward Delivering the Customer Service Opportunity To tap into the opportunity available to us and do more than just reactively mitigate disloyalty,  service organizations need to think differently about five components of the service experience: (1) our channel strategy, (2) live interaction approach, (3) service goal, (4) customer experience metrics, and (5) customer engagement strategy.  Below, we step into each part of the customer service experience, one-by-one. Channel Strategy: Organizations continue to offer more digital channels. Many of our conversations indicate that the driver for this is leadership pressure or thinking “this is a channel our customers would appreciate because they use it in other life activities”, and poor-fit channels aren’t being removed. Most organizations have subsequently failed to guide customers amidst this abundance of channel choice, leaving  customers free to determine which channel will work best. This has two results; often, customers end up using multiple channels simultaneously, and adoption of self-service is lower than we anticipated, despite customer preferences to do it themselves. ✓ Action: Leaders should reassess their channel mix and focus on a smaller subset of channels that offer ease of resolution, before putting in place a “Digital IVR” to guide customers to the best-fit, digital- and self-service-first channels for obtaining resolution. Live Interaction Approach: Despite our efforts to shift volume to self-service channels, we continue to receive (and often underestimate) significant assisted service volume. With ongoing attrition - caused in part by the increasing complexity of the rep role and subsequent burnout - and challenges quickly onboarding new hires, combined with reps’ natural tendencies to be empathetic, operational excellence requires that we shift interactions to a more prescriptive approach. Doing so could reduce costs, and customer effort. Getting to this prescriptive approach requires that we get our house in order first. ✓ Action: Fellow expert Rupinder Chandhok suggests that “service leaders should monitor their self-service performance, hire/onboard effectively, and work closely with their workforce management team to understand and actively manage the volume of calls reps are taking on, before it causes rampant burnout.” Service Goal: Service can no longer be just an “issue resolution shop” for customers – we must also focus on growing the business through value delivery. In Gartner’s 2022 priorities poll, only half of organizations said they had developed a Value Enhancement strategy to-date. Of those organizations, only 19% said their strategy was effective or very effective. While Value Enhancement is starting to take place, we've observed several hurdles that are limiting its success. They include only focusing on value enhancement in the live service channels, even though self-service channels work just as well to deliver value. We’ve also observed always-on, non-tailored approaches which actually drive greater disloyalty. ✓ Action: To ensure we effectively deliver value, leaders must develop contextual value enhancement strategies for both assisted and self-service. Service can no longer be just an “issue resolution shop” for customers – we must also focus on growing the business through value delivery. Customer Experience Metrics: Static survey metrics such as Net Promoter Score (NPS) and Customer Satisfaction (CSAT) have long been seen as important indicators of service performance. While survey metrics continue to play an important role in measuring customer sentiment, many service leaders today are turning towards more advanced methods for measuring service’s impact on the customer’s experience and confidence. Our colleague Daniel O’Sullivan highlights that “leaders are placing a major emphasis on data and analytics capabilities to help them understand opportunities to improve the broader customer experience.” But underneath it all, many organizations are still measuring the wrong things. Customer Effort Score (CES) and Value Enhancement Score (VES) more accurately capture customer behavior and intent during and following a service interaction, but many organizations have yet to implement or adopt these metrics as their “north star”. ✓ Action: Leaders should introduce and prioritize action-oriented indicators like CES and VES to better understand the total customer experience, and derive this insight from both surveys and data and analytics capabilities. Customer Engagement: Organizations know the future of service centers around more preemptive, predictive service experiences but are struggling to make it a reality. John Quaglietta explains the challenge: “Data is the foundation for any predictive model. Organizations struggle because data exists in many places requiring leaders to identify the use case, match the required data sources to fulfill the use case, and then wrangle data into a format that can be consumed by analytical models. That is no small feat.” To achieve this future-state, leaders need to implement a Dynamic Customer Engagement (DCE) framework, using data to target next best actions, recommendations, and guidance. ✓ Action: Leaders must start by understanding, developing and championing the DCE framework, and subsequently building a business case to secure approval and prioritize the investments necessary for implementation. Taking action against these five pillars is critical to building the foundations for the Customer Service and Support function of the future. Failure to do so will result in our function neither meeting the expectations of the wider business, nor our customers. So, what progress have you made so far? What action can you take this month to move the needle one step closer to delivering your full potential value? Gartner is going to keep pushing Customer Service & Support leaders to deliver the untapped opportunities on offer. Meet with a Gartner expert to craft your step-by-step action plan to fulfill your potential.