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CUSTOMER RETENTION AND EARNING LOYALTY NOTES

Questioning structure;

  • the structure of a question,
  • the role and value of questions in difficult situations,
  • how to avoid the pitfall of a poor question aggravating a situation,
  • Questioning style.

Earning Customer Loyalty
It is said in business that customer acquisition is an investment but profitability is built on customer retention. In other words, it typically costs you more to sell to a new customer than it does to a current one. As a result, your profits are higher when you sell to those who have already purchased from you.

Customer retention is essential to business growth.
So how do you earn customer loyalty and retain their business? Like any successful relationship, If you want customers to be loyal to you, you must be loyal to them. Your product must deliver on its promise as advertised—but that is just the beginning.

Here are some tips to help you keep your current customers coming back for more:
Provide Exceptional Customer Service
Often times, customer service can be a key differentiator for companies that sell similar products. In today’s digital age it is all too common for companies to hide behind “digital walls”. Often times this elusive nature can lead to lost sales not to mention decreasing customer confidence. When customers have questions or problems they want them addressed—by a real human with real answers, not just a scripted list of FAQs or automated phone system. Two ways to accomplish this are through posting customer service phone numbers on your site and considering Live Chat type systems.

Stay in Front of Your Customers
You can’t foster customer loyalty if your customers forget you exist. You must stay in contact with them on a regular basis preferably with information that ultimately benefits them in the end (remember it about the customer not you.) Two ways of staying in front of them are through email and RSS feeds. The key here is to feed them information that helps them. Promotions on products, sales etc… all work and should be a part of your communication but doesn’t neglect the need to provide them with valuable content that helps better their position. This could be showing them new ways to use your product, complimentary products that may work well with
the one they already have etc…

Develop Customer Friendly Policies
If you want to keep customers happy you must offer flexible policies. Don’t make it hard for them to return an item, get support for current, broken, or discontinued products, etc… Be flexible and understanding of their needs and above all else, make it right for them. Put these policies in place and honor them. If you don’t, your customers will run to the competitors that do never to return again.

Consider Implementing a Rewards Program
Loyalty or rewards programs are a great way to foster long term relationships and repeat sales. Rewards can be managed in just about anyway you can dream up from earning discounts on future purchases to earning products at various levels. Just make sure your internal systems can handle the route you adopt. Just about anybody can sell on the internet. Selling profitably and doing it for sustained durations is what separates real businesses from short run fly-by-night operations. If given the chance, I’d rather build a sustained business that lasts many years than build a business that is here today gone the next. Profitability is a key element in this equation.

Truly caring about your customers is the real key to earning customer loyalty.
I thought his list was pretty good for earning customer loyalty:

  • following-up before they can
  • calling to ask how things went after an event
  • sending a note of appreciation
  • telling them how much you value their business
  • asking for input before it’s offered
  • predicting their next need
  • admitting guilt when you’re guilty
  • delivering bad news before they even notice it
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PROBLEM SOLVING & HANDLING CUSTOMER COMPLAINTS NOTES

Customers are becoming more demanding and in some cases–rude. Complaints are an opportunity to improve existing service and begin delivering quality service. Identifies basic problem solving skills, complex problem and irate customer handling skills. Introduces the concepts of self-talk and class acts. Key Points Covered: Learn why complaints should be considered “opportunities.” Learn why the average business hears from only 4% of its dissatisfied customers. Visualize what the other 96% do. Learn to know the easiest type of complaint to resolve. Learn to understand the four basic steps you should take when handling a specific problem. The more complex problems require expanding these four basic steps. Learn two additional skills needed to diffuse difficult situations. Irate customers can be upsetting.

How To Deal With Customer Complaints
Every business has to deal with situations in which things go wrong from a customer’s point of view. However you respond if this happens, don’t be dismissive of your customer’s problem – even if you’re convinced you’re not at fault. Although it might seem contradictory, a customer with a complaint represents a genuine opportunity for your business:

  • if you handle the complaint successfully, your customer is likely to prove more loyal than if nothing had gone wrong
  • people willing to complain are rare – your complaining customer may be alerting you to a problem experienced by many others who silently took their custom elsewhere Complaints should be handled courteously, sympathetically and – above all – swiftly. Make sure that your business has an established procedure for dealing with customer complaints and that it is known to all your employees. At the very least it should involve:
  • listening sympathetically to establish the details of the complaint
  • recording the details together with relevant material, such as a sales receipt or damaged goods
  • offering rectification – whether by repair, replacement or refund
  • appropriate follow-up action, such as a letter of apology or a phone call to make sure that the problem has been made good

If you’re proud of the way you rectify problems – by offering no-questions refunds, for example – make sure your customers know about it. Your method of dealing with customer problems is one more way to stay ahead of your competitors

ESSENTIAL TIPS IN HANDLING CUSTOMER COMPLAINTS
The hardest complainant type first:
If a customer is abusive you must to make you first goal is to calm the customer’s temper and take control of the situation. You need remain open and friendly, stay calm and keep your voice low and controlled. Tell the customer you are interested in his/her complaint and say ‘in order to help you I need to fully understand your problem’. Then ask ‘can you tell me what is wrong in a calm voice to ensure I focus on the problem (rather than the emotion) so I am better able to find a solution’. Let customer ‘vent his or her frustration’ and don’t interrupt. Telling you their complete story, and describing how upset they are, allows customers to release pent-up frustrations. It is wise to take notes as you go as it helps you with your response and shows the customer you are seriously interested in their problem.

BLAMING OTHERS IN YOUR ORGANIZATION
The worst tactic I have come across is a customer service officer trying to blame me, the customer, for the problem. Never play the blame game! Blaming the customer for the problem will dramatically worsen the situation. Also particularly never use the phrase ‘sir our system requires…‘ or even worse ‘sir you don’t understand our system’ (a common phrase with many service providers in Asia, especially bank staff). Never blame others in your organization. Both the ‘system excuse’ and blaming others will be seen as evasive (or even worse cowardly) and destroy your credibility with the customer. No customer cares about your ‘problems’, they just want their problem solved. Accept responsibility as a representative of your company and place your efforts into solving the problem.
‘FRUSTRATION: HAVING TO RESIST THE TEMPTATION TO CHOKE THE LIVING S OUT OF SOMEONE WHO REALLY DESERVES IT!’ This is a funny saying however it has no place in customer complaint handling, in spite of the bad attitude of many
customer service’s staff I have met (and trained) over the years.

GET THE ENTIRE STORY:
When the customer has told you the whole story regarding a complaint tell the customer what you will do to solve the problem. Do not tell the customer what he or she must do to solve the problem. Use phrases such as… ‘I will contact the xyz department’… ‘I will find the document’… ‘I will gather the necessary information’ etc. If you use ‘I’ in place of ‘you,’ you will help to minimise tension as it assures the customer that you are taking responsibility for the resolution of the issue. If you need to refer the matter to a third party always check back with the customer to ensure the other party has made contact and that the problem has been solved. Sure it’s wise to check with the third party to ensure a solution has been found first, however contacting the customer after the event will reinforce both your own and your company’s image. Important point never use the word ‘no’, either recommend a solution or suggest a compromise.

PROBLEM SOLVING AS A CHANCE TO LEARN AND IMPROVE
If you view problem solving as a chance to find out how to improve your company’s operation (or image) and as an opportunity to learn something, rather than a nasty experience, you can approach these difficult situations with a more positive frame of mind. In most complaint situations there are only win-win or lose-lose results. Everyone will win with satisfied customers as you can gain a positive company image and an advocate for you and your products/services (plus hopefully some personal satisfaction) or everyone can lose with upset customers and the gradual destruction of your company’s place in the market plus… personal emotional upset.
Every time you allow someone else to change your emotional state YOU LOSE. Turn complaints into opportunities! In reality when you win, so does the customer and if you lose, so does the customer.

IT’S BETTER TO RECEIVE A COMPLAINT THAN HAVE AN EX-CUSTOMER THAT NEVER TELLS YOU WHY THEY LEFT!
FOLLOW-UP:
1. After you’ve resolved a customers’ complaint, it’s essential you place a record on file to ensure the next person handling the customer is aware of the problems encountered so they do not inadvertently ‘walk into a minefield’.
2. Best practice in customer service demands that we place a file note to give a little extra attention to the customer to reinforce the fact that the previous problem was a ‘one off’. This may well cement good future relations.
3. You must also ensure that the problem’s causes are analysed and counter measures are employed to make sure the same situation does not recur. If you learn a ‘better’ way you do business make the learning worthwhile and find a way for your company to make the changes required. Also the last thing you want is for any customer to have a similar problem let alone the same customer have two bad experiences in a row. If they do, chances are you’ve lost them (and all those they can influence) forever.

ONE UNANSWERED COMPLAINT CAN LEAD TO THE LOSS OF LARGE NUMBERS OF POTENTIAL CUSTOMERS
Effective or ’good’ customer service needs to be a company wide philosophy not just a procedure. Effective complaint handling is a key element to retaining customers. All job descriptions should contain a responsibility statement for all functions and levels of staff,
regardless of their perceived requirement for direct customer contact (or not). In hiring interviews, orientation programmes and training sessions, emphasize that everyone is in the customer service business. Make sure that all employees understand how they directly or indirectly ‘effect’ the customer. Include customer service in all performance evaluations and set up a complaint recording system with a section to report outcomes and responsible personnel.

Even if you don’t have a formal ‘Total Quality Management’ function ask employees to submit a list of the specific things they’ve done to help provide superior customer service. If ‘to serve a customer is the only reason for a business to exist’ (and it is) you need to be passionate about updating or modifying your staff’s attitudes and company procedures to eliminate as many complaints as you can.

LEARN TO LOVE COMPLAINTS, THEY ARE GUIDEPOSTS TO IMPROVED PERFORMANCE!
If you can view problem solving as a chance to find out how to improve your company’s operation (or image) and as an opportunity to learn something, rather than a nasty experience, you can approach these difficult situations with a more positive frame of mind. In most complaint situations there is only win-win or lose-lose results. Win with satisfied customers and a positive company image (plus personal satisfaction) or upset customers and the gradual destruction of your company’s hard fought place in the market and personal emotional upset. Every time you allow someone else to change your emotional state YOU LOSE. Turn complaints into opportunities! Remember when you win, so does the customer and if you lose, so does the customer.

Under the heading of “focus on the people who focus on the customers”, a manager’s customer service guide I once read (source unknown) stated:
“Make customer service a part of all written or verbal job descriptions—no matter the function or level. In hiring interviews, orientation, and on-the-job training, emphasize that everyone is in the customer service business. And make sure that all employees understand how they directly or indirectly ‘touch’ the customer.”

“Remember that people do what’s expected when it’s inspected! Include customer service in all performance evaluations. Prior to conducting evaluations, ask employees to submit a list of the specific things they’ve done to help provide superior customer service.”

“Go on a paralysing policy hunt! Ask employees to identify policies and procedures that get in the way of providing good service. Then do your best to update, modify, or eliminate as many as you can.”

Research indicates that:
1. Seven out of ten complaining customers will do business with you again if you resolve the complaint in their favour and if it is resolved on the spot, 95% will do business with you again.
2. A typical business hears from only 4% of its dissatisfied customers; the other 96% just go silently away and 91% of them will never come back.
3. A typical dissatisfied customer personally tells more than eight people about his or her problem. With today’s communication options and social media usage a dissatisfied customer may now publicize his or her dissatisfaction to thousands.

Talking of dissatisfaction… dissatisfied with your job? Take a look at the free blank resume form and update your resume perhaps!

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TRANSACTIONAL ANALYSIS NOTES

Transactional Analysis (or TA as it is often called) is a model of people and relationships that was developed during the 1960s by Dr. Eric Berne. It is based on two notions: first that we have three parts or ‘ego-states’ to our ‘personality. The other assumption is that these converse with one another in ‘transactions‘ (hence the name). TA is a very common model used in therapy and there is a great deal written about it.

Communications (Transactions)
When two people communicate, each exchange is a transaction. Many of our problems come from transactions which are unsuccessful.

Parents naturally speak to Children, as this is their role as a parent. They can talk with other Parents and Adults, although the subject still may be about the children.

The Nurturing Parent naturally talks to the Natural Child and the Controlling Parent to the Adaptive Child. In fact these parts of our personality are evoked by the opposite. Thus if I act as an Adaptive Child, I will most likely evoke the Controlling Parent in the other person. We also play many games between these positions, and there are rituals from greetings to whole conversations (such as the weather) where we take different positions for different events. These are often ‘pre-recorded’ as scripts we just play out. They give us a sense of control and identity and reassure us that all is still well in the world. Other games can be negative and destructive and we play them more out of sense of habit and addiction than constructive pleasure.

Conflict
Complementary transactions occur when both people are at the same level. Thus Parent talking to Parent, etc. Here, both are often thinking in the same way and communication is easy. Problems usually occur in Crossed transactions, where the other person is at a different level. The parent is either nurturing or controlling, and often speaks to the child, who is either adaptive or ‘natural’ in their response. When both people talk as a Parent to the other’s Child, their wires get crossed and conflict results. The ideal line of communication is the mature and rational Adult-Adult relationship.

So what?
Being a Controlling Parent can get the other person into a Child state where they may conform with your demands. There is also a risk that they will be an Adaptive ‘naughty child’ and rebel. They may also take opposing Parent or Adult states. Be a Nurturing Parent or a talk at the same level as the other person to create trust. Watch out for crossed wires. This is where conflict arises. When it happens, first go to the state that the other person is in to talk at the same level. For rational conversation, move yourself and the other person to the Adult level.

Transactional Analysis and Communication
Transactional analysis or TA is a branch of psychotherapy developed by Eric Berne. His definition of it is “a theory of personality and a systematic psychotherapy for personal growth and change”. Knowing about TA can be very useful for improving our communication skills. TA is about how people are structured psychologically and is both a theory of communication and a theory of child development.

Berne’s model is a three part ego-state model. An ego state is

  • “A consistent pattern of feeling and experience directly related to a corresponding consistent pattern of behaviour”.
    There are three ego states in Berne’s model:
  • Parent,
  • Adult,
  • Child.

Ego states are irrespective of age and are capitalized to differentiate from the normal use of the words parent, adult and child.
The Parent and Child ego states are echoes of the past. The Adult ego state is a response to the here and now when a person is grown up and using grown up responses. Ego states are ‘things’ not names. They are a set and related; thoughts, feelings and behaviours.
Communication between people can be from one ego state to a different one or from one ego state to the same ego state.

Normally communication will be from one ego state either to the same ego state or a different one. The person who first communicates will expect a reply to be from a certain ego state. If communication is from a different ego state to the expected one, then the communication may be ineffective and the message may be lost, not received or disregarded by the person receiving it. If communication is from Adult to Adult then it is likely to be the most effective communication for most of our communications.

The ‘3 Rules of Communication’ in TA
1st Rule of Communication
So long as transactions remain complementary, communication can continue indefinitely.

2nd Rule of Communication
When a transaction is crossed, a break in communication results, and one or both individuals will need to shift ego states in order for the communication to be reestablished

3rd Rule of Communication
The behavioural outcome of an ulterior transaction (one where two messages are sent at the same time; one overt social and one covert psychological) is determined at the psychological level and not at the social level.
Example of Complementary Communication

Example of non complementary communication
Diagram shows Parent ego state – expected reply would have been something like “I’m sorry it won’t happen again” from Adapted Child

The ego states are sub-divided.
Parent ego state is divided into:

  • Parent into Critical Parent CP – which is negative, unsupportive, critical.
  • Nurturing Parent NP – which is supportive, helpful, nurturing, comforting.

Child ego state is divided into:

  • Free Child FC (sometimes referred to as Natural Child NC) which is spontaneous, freewheeling, playful, self-indulgent, curious, rebellious.
  • Adapted Child AC – which is toned down behaviour that has been learnt in response to the reactions from other people to us and our behaviour. The learned or adapted responses are more likely to generate a given result from the receiver.

The 3 ego states can be used as a way of analysing transactions (communications) between people. A transaction is a communication from A to B and the response from B to A.

Examples of Complementary Transactions
Where the message is sent from one ego state and the reply is from the expected ego state. The transaction is complementary.

Examples of Crossed Transactions
When a message is sent from one ego state and the sender expects it to be sent back from the expected ego state: but it’s sent back from a different one. The transaction is crossed; communication is non effective.

A crossed transaction could lead to argument and loss of effective communication. The message is ‘lost’.

Using TA For Effective Communication
For effective communication you need to keep the transaction complementary i.e. focus on sender to receiver and receiver to sender where the message is sent to the ego state from which you expect a reply. Using ego states we can look at how others communicate and how we communicate with others. It’s possible to identify which ego state we are in and which ego state we are expecting a reply from.
We can also use TA to help us plan transactions. For example we can identify which ego state would be most valuable for us to send the message from and which ego state it would be better for it to be received by. If we receive a reply from the wrong (non expected) ego state then we can either try to shift the other person’s ego state; or if we cannot do this it may be better to stop the communication and try again another time when the person may be in a different ego state. We can listen to people’s communication to identify if they are habitually in one ego state and then decide if communication to that ego state would be appropriate or not. TA therefore can be used to elicit the reactions you want from other people (and this will happen consciously or unconsciously).

We can help communication if we need to by trying to shift the other person’s ego state by inviting people to move into a different ego state (they may not always move into it though, particularly if someone is habitually in one ego state). Do this by acknowledging their current ego state (by the appropriate message or response) and then invite them into another ego state by the words (and body language) which you use.

Invite them to move into Adult by:

  • Asking a question
  • Stating a few facts
  • Asking for their opinion
  • Asking for their preference
  • Asking for their view

Invite them to move into Nurturing Parent by:

  • Asking for their help
  • Asking for their advice
  • Asking for their expert opinion
  • Communicating your fears/worries

Invite them to move into Natural Child (Free Child) by:

  • Being one yourself
  • Showing the funny side of the situation
  • Going to nurturing parent
  • Being enthusiastic
  • Showing an unconventional way of looking at things.

TA implies that you can have considerable impact on modifying unsatisfactory behaviour by the way you communicate with others. You use your Adult ego state to think about what behaviour is appropriate. The Adult ego state has the capacity to control the other two ego states.

Playing Games
In ‘Games People Play’ Berne identified that people habitually adopt certain ego states (not necessarily consciously) and “play games” in the way they communicate with others. E.g. a person might say “I’m fat” or “Nobody Loves Me”, they are in Adapted child. They expect a nurturing parent response of “no you are not” or “yes they do”. If they received a response of “I know you are” or “You’re right, everybody hates you” then they have received a reply that they didn’t want. Some people go through life playing a game and people can be in a relationship where one person is the Adapted child and the other the Nurturing parent.

Some people habitually play games and go through life playing games such as:
‘Isn’t life unfair’,
‘Everyone is against me’
‘I am poorly’,
‘I am always right and you are always wrong’
‘It is your fault that I …’

Games typically:

  • Are repetitive
  • Are played without Adult awareness
  • Always end up with players experiencing racket feeling.
  • Games entail an exchange of ulterior transactions between the players
  • Games always include an element of surprise or confusion.

Racket feeling – a familiar emotion, learned and encouraged in childhood, experienced in many different stress situations, and useless as a means of problem solving but frequently carried out E.g. my computer screen freezes, I get stressed and hit it. Common games include: “oh how I suffer” “Isn’t it awful” “victim, persecutor, rescuer” and “If it weren’t for you”
Strokes – units of recognition
Can be: verbal or non-verbal
Positive or negative

Conditional or unconditional
A stroke is a unit of recognition. E.g. you walk down the street and see your neighbour. As you pass you smile and say “hello”. They smile and say “yes, great day?” That’s a positive stroke you’ve given and received. If your neighbour ignored you then you felt left out or deprived or wonder what you have done to offend them.
Any transaction is an exchange of strokes. This may be entirely non-verbal.
Positive strokes – the receiver experiences it as being pleasant.
Negative strokes – the receiver experiences it as being painful.
For example if your neighbour replied “It was a nice day until I saw you!” then that’s an example of a negative stroke. But any kind of stroke is better than no stroke at all.

Stewart and Jones identify that this is supported by work on rats where one group were given electric shocks and the other group were not. The rats given the shocks developed better – as they were receiving some stimulation.
Conditional strokes relate to what you do.
Unconditional strokes relate to what you are.
E.g. Conditional: “That was a good piece of work”
“That painting you’ve done is a real mess”
Unconditional: “Your humour always brightens things up”
“I hate you and all which you represent”

As infants we test out behaviours to find out which give us the strokes we need. If we receive strokes from a certain behaviour then we are likely to repeat it (and that can be where many of our learnt behaviours come from – albeit unconsciously learnt)

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COMMUNICATION SKILLS NOTES

For communication to occur effectively, the ability and skills are required:

  • must be able to communicate effectively with all levels of managements .
  • Must have substantial experiences, training in oral and written communication and demonstrate good writing skills.
  • Be able to prepare special analysis, research reports, and proposals.
  • Must have ability to communicate and sell ideas, firm, and products.
  • Need ability to compare effective correspondence
  • Must be able to cultivate and maintain good customer relationship.
  • Need skills in gathering, analyzing, and interpreting data and in writing analytical reports.

ENCODING :
Encoding is dressing your thoughts with the meaningful language. Then the use of this language, oral, written or nonverbal, becomes a message . The wording of he message should observe the art of empathy so that it reaches the receiver correctly and understandably. Encoding includes writing, speaking, and other communication means.

Decoding is done by the receiver. His decoding of the message depends upon his past background, perception, knowledge of the language, understanding ,viewpoint and relations with the sender. Decoding is reading , listening and understanding .

Developing Effective Communication Skills
Speaking and Listening Skills, Verbal and Nonverbal Communication
Consequently, developing good listening and effective speaking skills should be an integral part of everyone’s personal development.
Information cannot be effectively received, transferred or exchanged without using good communication skills.

Verbal and Nonverbal Communication Skills
Individuals’ communication skills are a basis for an effective dialogue, and involve both verbal and nonverbal communication skills.
While verbal communication helps to express oneself, nonverbal enhances spoken ideas by means of bodily, voice, and eye behavior, facial expression, etc. It reinforces the effect of spoken words. In addition, nonverbal communication can be viewed as a reliable indicator of real feelings of an interlocutor. Observed and paid attention to, it can help a person to understand another one better.

Effective Listening
Listening is probably the most used skill in everyday communication. It involves hearing and paying attention to the speaker. However, hearing and effective listening are completely different abilities. Hearing thousands of sounds every day is a normal thing for an individual. Effective listening, on contrast, involves not only hearing, but also comprehending and understanding the message.
Sounds simple. However, not everybody is a good listener – some people prefer to talk. But to be a good communicator, what is important for an individual in both the personal sphere and at the workplace is to be an effective listener.

  • Pay attention to the speaker, first of all, in order to show you are involved in communication.
  • Respond both verbally and nonverbally, showing that the message is being comprehended and followed. Eye contact, gestures, facial expression, short responses or brief expressions of attitude, such as nodding, help the speaker to understand whether a
    listener follows the conversation.
  • Do not interrupt the speaker in the middle of a speech. Wait till the idea is explained completely, think the information over to understand the meaning, and only then provide suggestions, comments, or ask questions.
  • Ask questions and confirm your understanding of the message. A brief summary of what the speaker said might be the best idea. It shows that the speaker was listened and paid attention to.

Effective Speaking
As a mean of communication, effective speaking plays a vital role in people’s lives. Though everybody speaks everyday and is able to express ideas, thoughts, or requests, not everybody can do it well. Some people are difficult to follow, some explain their thoughts in a complicated manner, and some are simply boring to listen to. Avoid these mistakes.

  • Use plain and simple words unless the audience is specialized in the subject area.
  • Use complete simple sentences for the message to be easier to comprehend.
  • Do not speak too fast. It is difficult to comprehend information if much of it is presented in a short period of time.
  • Make pauses. Pauses between sentences and ideas will give a listener some space to think the words over, to understand the message.
  • Structure and connect ideas. Major points should be presented in a logical manner. Otherwise it is difficult to follow the speaker. So, make sure that each next thought expressed expands on the subject and on the previous point.
  • Support ideas not only with words, but with intonation and nonverbal means of communication as well. Proper intonation can stress certain ideas you want to draw attention to. Nonverbal means of communication, such as gestures and facial expression,
    establish a closer connection with the audience, and enhance the message being communicated.

Benefits of Good Communication in the Workplace
Communication Skills Improve Workplace Efficiency
Good communication in the workplace is essential and helps to improve morale, increase efficiency and create healthy working relationships. In any form of employment, good communication skills are a real asset and particularly in today’s difficult financial climate, it is more important than ever to be able to communicate effectively whether this be with colleagues, employers, employees or customers. For those who have been made redundant and are now facing job interviews or are having problems with others
within the workplace, effective communication skills will be an extremely useful resource.

Understanding Good Communication Skills
When most people think about communication it is usually speaking that first springs to mind, however, being able to listen well is a large part of effective communication. It is also about being able to listen to what the other person is not actually saying but is communicating through non-verbal behaviours. Examples of non-verbal communication include using gestures, facial expressions, body language as well as using various props.

Good Workplace Communication Improves Morale
A major benefit of good communication within the workplace is that it may very likely lead to an improvement in office morale. For example if employees never or rarely receive any kind of positive feedback or idea as to how the company is performing then it is often quite difficult to stay motivated. When very little is communicated back to employees this may also trigger a sense of distrust leading to increased tension and conflict.

Questions skills;
Effective Questioning Skills
How important is it to ask good questions? It’s very important. It’s important you use questioning skills to help you completely understand the caller’s situation. Otherwise, you could be responding to what you guess the caller means, which may or may not be correct.

Questioning goes beyond listening.
Effective questioning is a real compliment to your skills. It shows that you have the ability to understand the caller’s real needs. It shows that you are looking for meaning that’s deeper than the spoken message. Effective questioning is a powerful, learned skill. It says to the caller, “I’m interested in determining your needs.”

Questioning can be put into two divisions: Open-Ended Questions and Closed-Ended Questions.
Open-Ended Questions: Open-ended questions are questions without a fixed limit. They encourage continued conversation, and help you get more information. Plus, they often provide opportunities to gain insight into the other person’s feelings. Open-ended questions draw out more information. If you want the caller to open up, use open-ended questions that start with
who, what, where, why, when, and how. A few examples are:
“What are some of the things you look for in a hotel?”
“How do you feel government could be more responsive to your needs?”
“What are your concerns about this new program?”

Closed-Ended Questions: Closed-ended questions have a fixed limit. They’re often answered with a yes or no, or with a simple statement of fact. Closed-ended questions are used to direct the conversation. They usually get specific information or confirm facts. Here are some
examples.
“Do you have health insurance?”
“Do you want the new brochure?”
“Would you be interested in that?”
We use the open-ended questions to get more information and the closed-ended questions to focus in on one area.
Additionally, there are several other type of questioning techniques this are;
Probing Questions: Sometimes you ask an open-ended question to get more information and you only get part of what you need. Now it’s time for a probing question. A probing question is another open-ended question, but it’s a follow-up. It’s narrower. It asks about one area. Here’s an example:
“What topic areas are you interested in?” This question would be better than reading off 50 topics to the caller. It’s a probing question.
A few other examples are:
“Are you able to tell me more about the form you received?”
“What did you like best about Paris?”
Probing questions are valuable in getting to the heart of the matter.
The Echo Question: Here’s a good technique for getting more information. You can use this like a probing question. The idea is to use the last part of a phrase the caller said. Slightly raise the tone of your voice at the end of the phrase to convert it to a question. Then pause and use silence – like this:
“…The bill you received?”
An echo question repeats part of the phrase that the caller used, using voice inflection to convert it to a question. Some people call it mirroring or reflecting. Others call it parroting. We call it echoing. Whatever you call it, it’s a valuable technique to use.

Leading Questions: Many things can be good or bad. Take fire for example. Fire warms our home, cooks our food, and does many other useful things. Uncontrolled, it can burn down our houses. The reason we use that example is because leading questions can also be good or bad. Leading questions, if used improperly, can be manipulative because you’re leading the person to give the answer you want. When they are used properly, you’re helping that person. Some examples of proper leading questions are:
“You understand what I’m saying, don’t you?”
“You’ll want to know about our same day delivery service, right?”
“You’ll want to go ahead with this, won’t you?”
Leading questions often end with suggestive nudges toward the desired answer. Some ending phrases would be, “Don’t you?”, “Shouldn’t you?”, “Won’t you?”, “Haven’t you?”, and “Right?”

So where are leading questions useful? Well, they’re useful in helping someone who’s undecided make the right decision, a decision that will benefit them. You use a leading question ethically when you help someone do the right thing. Some folks call this technique the “tie down” technique because you’re actually trying to tie down the caller’s needs. The bottom line is to practice using a variety of questioning techniques. It will help you help your callers more effectively. After all, you want to provide the very best customer service, don’t you?

Why are closed questions useful?
Closed questions are also useful in their own place. They are necessary at the end of a piece of communication to ensure clarity. They are also good if you are unclear about the information you are receiving. If somebody has a tendency to waffle or ramble, you may need closed questions to get clear on the key points of the message.

Some of the particular situations where closed questions will help you are ;

  • To get specific information
  • To get commitmen
  • To seek clarification or reassurance
  • To gain confirmation/affirmation
  • It can speed the process up
  • To round off a conversation
  • To narrow down options

The Importance of Questioning
A learner is by nature a questioner. If there is a drive in an individual to increase knowledge, skills or understanding it is driven by doubt, curiosity, wonderment, incomprehension, puzzlement, uncertainty, recognition of a need, or curiosity. This drive is then focused through questions that the learner formulates and actively seeks to find answers to. They may be simple questions that seek clear facts, or complex questions that probe deep into concepts, beliefs and understandings. The question may provide an answer that solves the learning need or may lead to further questions as knowledge and understanding grows. It is obvious though, that however
simple or complex an issue is, a good clear relevant question will be of far greater use to the learner than a question that is vague, poorly defined or irrelevant.

“All our knowledge results from questions, which is another way of saying that questioning is our most important intellectual tool.” (Neil Postman) Thinking is central to all learning and there is no learning without thinking, but central to thinking is questioning. It is our questions that fuel and drive our thinking If schools hold a vision or goal that goes beyond the delivery of curriculum content, and if schools want to equip pupils with the skills of learning, then it becomes obvious that a primary skill for any independent learner is the ability to ask clear, well defined and relevant questions.

Questioning and Reading
The National Reading Panel (2000) analysed a large collection of over two hundred studies examining the approaches used for targeting the development of reading comprehension and found seven strategies that positively improve comprehension. Of these seven strategies (P18) there are three that have questioning skills at their core.

  • Question answering, where readers answer questions posed by the teacher and receive immediate feedback;
  • Question generation, where readers ask themselves questions about various aspects of the
    story;

Story structure, where students are taught to use the structure of the story as a means of helping them recall story content in order to answer questions about what they have read. Asking the right questions is one of the vital factors in closing sales and is a key part to any good sales training course. Salespeople usually focus on securing an order; so closing is their main concern. However, emphasis on the end of the sales process often leads to the preceding steps being neglected or, in some cases, completely overlooked. The fact remains that it is questions which ultimately unlock the sale – so it is vital that they are designed carefully and used in the right
sequence.

Successful salespeople, have ability of asking open-ended questions. These questions – usually starting with interrogative words such as who, what, why, and so on – provide us with more information than closed questions. Closed questions, inviting a shorter answer such as yes or no can also be used to gain specific yes or no answers. Both types of questions can be used in tandem with each other, to great effect. The key point to understand here is not the volume of information that each type of question leads to, but the quality of that information. One of the greatest sounds that any sales representative can hear is that their prospect has a problems with their current supplier. It may be a difficulty with delivery, payment, service, fee or a host of other factors. This knowledge will be imparted in two ways.

Firstly, the facts of the circumstances will be revealed – for example a grievance about recurring delayed delivery. Secondly, the impact on the individual concerned will be divulged. This could be: “It’s giving me a real headache.” This knowledge is exceptionally valuable as it indicates that the prospect has become emotionally involved. This opinion should be explored even further, if allowed by the client. Looking back to the report about late delivery being an issue, a sales representative could then make use of a closed question to add even more weight to the issue. Following on with something like: “So you would like to be free from this complication, then?” makes the prospect ponder what life would be like if the position were resolved. Closed questions like this also furnish the sales representative greater authority over the meeting as they can be used to keep answers brief if so desired.

One of the greatest areas for improvement for new salespeople in use of questions is identifying the correct sequence in which they should be used and is therefore forms a fundamental element of sales training. This is symptomatic of the fact that, instead of listening to the prospect and using the information that they are given, they are often too busy thinking about what they’re going to say next. The sequence in which questions should be asked is a simple one, however, and is logical in its format.

Step 1
The initial section for a sales representative to investigate is the prospects current circumstances. power flows from the individual who knows, so they ought to find out as much as possible at this juncture. Who is at present supplying? What merchandise or utility? What amount are they paying? Who decides on its use and purchase? What is the volume per annum? All these questions build a picture of what is at present happening. They do, nevertheless, also perform another aim. The sales expert should be familiar with the competition inside out, and if told that commodity X is being supplied by supplier Y, should be accomplished to spot potential
weaknesses.

Step 2
The next step concentrates on problems, issues or weaknesses of the customers existing circumstances. By getting them to recognize any problems, they will be more disposed toward changing their supplier in order to alleviate the difficulties of the predicament.
Instead of selling an appealing, ostentatious concept, we are selling a rescue service. nonetheless, this sounds easier to do than it actually is, for two primary reasons. Firstly, customers are frequently unwilling to admit to problem suppliers because they may have chosen the supplier in the first place. Secondly, if done insensitively, prospects will consider this approach as a shock strategy and discharge it as the difficult sales approach. The explanation lies in two different techniques: looking for areas for enhancement and prefacing.

Instead of asking prospects to identify problems or issues, the sales representative asks them to deliberate over any areas where their current supplier could develop. This face-saving exercise allows the prospect to give vent to their opinion without having to accept that they actually do have some problems, which they themselves may have helped produce in the first place by choosing that supplier.
Each question can be prefaced by a declaration that softly introduces the question that follows. Examples include: “It would assist if you could provide me an intimation of your priorities. Tell me…”or “numerous y customers tell me that they had the selfsame trouble. What if…” etc. once in a while, with the bombastic sort, it may be fitting to preface each question with a phrase like: “Would you mind if I asked..?” This will appeal to their need for esteem and they are more probable to respond.

Step 3
The last step is to ask them to identify the consequence of having any problems solved. This may be articulated as a safer workplace, higher margins, greater industrial relations, or even a more motivated workforce. Whatever the benefits are, the vital thing is to get the prospect actually talking about them. This will reinforce their own desire to at least endeavour to put right the , which will with any luck be achieved by accepting your recommendation. The last question to ask, therefore, is the pre-closing one: “If we could find a system of slaying those problems, while still maintaining an exceptional service, would you be predisposed” Implementing these techniques will have a positive effect on sales performance. These skills can be developed by attending a good sales training course.

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HANDLING DIFFICULT SITUATIONS NOTES

Handling difficult people and situations is one of the most stressful aspects of the modern working environment. This handling difficult people and situations training course provides a practical guide on how to handle difficult people and situations effectively and ensure successful outcomes. Delegates will examine aspects of human behaviour and review their options when faced with difficult, aggressive or un-co-operative people. This course provides delegates with an opportunity to discuss their own experiences as well as those of others in a safe and supportive environment.

Dealing with customers frustration quickly and professionally are all part of providing a high quality customer service level. Everyone has his or her own personal customer service nightmare story. So it’s easy to understand how a customer may perceive things from their side of the counter when they confront you looking for satisfaction. The next time you encounter a difficult customer relation situation either on the phone or in person consider the following steps:

Step 1: Remain Calm Yourself
When a customer begins to vent their frustration it is important to remain calm yourself. Staff may take things personally and assume that the customer’s anger is directed at them and so then it is natural to become defensive. *Realize that in most situations the customer is likely angry at the situation and not you.

Step 2: Allow the Customer to Vent Their Frustration:
Do this without interrupting. If you would like to defuse the customer’s anger, try apologizing.
You could use such phrases as,
• “I’m sorry you had to go through this.“
• “I can understand why that would be so upsetting.”
Usually when you apologize, the customer’s anger is immediately dissipated. You may feel uncomfortable for apologizing for something that you are not responsible for. However, keep in mind that you are apologizing on behalf of the facility not yourself.

Step 3: Paraphrase The Problem
In your own words, paraphrase what the customer is saying and feeling. Show you are truly sympathetic with the customer’s problem.

Step 4: Resolve The Problem
Once you have gained the customers confidence, you are in a position to resolve the problem. It’s a common mistake to try to solve the problem while the customer is still angry. The customer is often looking for an apology first, then a resolution to the problem. Record and report the incident to your supervisor. This can assist them in determining if the problem is a common issue for customers that needs possible changes to the operation to avoid future situation and /or if follow up is required with the customer. In some circumstance you may not be able to resolve the customers concern. Record the details and forward them to your supervisor for follow-up. This will assure that all that can be done will be done

Here are some further techniques for dealing with an upset customer:
Technique 1: Keep It Impersonal and Professional
It is important not to antagonize the customer by the way you speak to them.
For example, if you have to inform them that they did not interpret the swim schedule correctly. Never say, “You didn’t read it correctly.” Instead say, “There are a few areas on the schedule that could be improved upon.”
Can you see the difference in the way the message could be sent and received?
It’s as if the customer was not at fault.

Technique 2: “I Versus You”
Imagine an upset customer trying to explain something to an employee that does not understand. The employee says, “You are confusing me.” This statement makes the customer feel more frustrated. Instead of saying, “Excuse me but I am confused” or “Let me see if I have this straight.”
Using “ I” instead of “you” avoids angering the customer further, and will help, as opposed to hinder, the communications process.

Technique 3: Avoid Saying, “But It’s _______Policy”
Nothing frustrates a customer more than to hear the phrase “It’s our policy” To the customer this suggests that the organization comes first and the customer comes second. Think how some banks treat customers these days and you will visualize the frustration that your
customers will experience with a statement like that.
Instead take the time to explain why such a decision has been made.

Technique 4: Take Responsibility
How many times have you experienced an employee say, “It’s not my job”, When you ask them a question, or you ask the clerk where a certain item is located in a store, and you are told where you can find it, instead of being escorted to it.
Always take the steps to ensure the customer’s needs.

Technique 5: Keep The Customer Informed
Sometimes when a problem arises that cannot be resolved immediately, you can tell them that you or your supervisor will get back to them by a certain time. Even if you don’t have that problem solved by that time, call the customer back to advise them that you are working on it. The customer will respect you and the facility for keeping in touch.

Technique 6: “You Have To…”
A customer doesn’t have to do anything. The customer is doing us a favor, not the other way around. Instead of saying, “You have to do this“ say, “Would you mind doing this so we may resolve the problem quickly”.
The customer will see that you recognize the importance of resolving the issue quickly and will likely support your request of them.In the height of busy times, it is sometimes difficult to follow these steps and techniques, but if you have had a bad experience, review these suggestions and see how you may have handled things differently.

A few words to consider…
Our Customers
Customers are the most important people …in person on the phone or by mail.
Customers are not dependent on us … we are dependent on them.
Customers are not an interruption of our work… they are the purpose of it.
We are not doing them a favor by serving them… they are doing us a favor by giving us an opportunity to do so.
Customers are not someone to argue or match wits with. Nobody ever won an argument with a customer.
Customers are people who bring us their wants. It is our job to handle them profitably, to them and to ourselves.
Dealing with Difficult Customers If you’re in a public contact position, chances are you’ll encounter angry customers. If customers are not handled effectively, they may remain angry, refusing to do further business with your organization. They will also make you angry and upset as well!

Resolving a customer’s anger helps you feel better about yourself, increases your job satisfaction, makes you look good to your supervisor, and enables your organization to keep customers satisfied and coming back.

Here are the suggested steps to deal effectively with an angry or difficult customer:
1. Identify the angry customer. Learn to read verbal and non-verbal language.
There are two types of anger:

  • Aggressive – person expresses feelings immediately. Anger and hostility are obvious. There is often use of sarcasm describing the merchandise or situation, rapid or abrupt speech, or raised voice.
  • Passive – person keeps his/her anger inside, but their body language gives them away. They plan never to return or do business with your organization again.

2. Diffuse the customer’s anger. Deal with the customer’s feelings. Do it in the following way:

  • Empathize – enter into the feeling and spirit of the person. Put yourself in their “shoes.” You need to try to understand what they’re saying, from their point of view. To do this you must be a good listener who blocks out distractions. Show them that you’re really listening by maintaining eye contact, nodding and saying, “I see”, or “I understand how you must feel.” As they talk, the anger will dissipate and you’ll get more information about the problem or situation. If the customer is aggressively angry, let their tirade flow uninterrupted until it’s exhausted. If the customer is passively angry, it’s better to confront their anger and bring it out into the open by saying something like “I’m sorry you’re upset about this. Let’s see what we can do about solving the problem.”
  • Ask questions – learn as much as you can about the situation before you attempt a solution.
  • Give feedback – restate, in your own words, the feelings you detect behind what the person is saying. For example, you might say, “It sounds like you are in a hurry. Let’s take care of this right away.” Feedback should be neither judgmental nor critical but should be positive and supportive. Sound sincere because you don’t want your customers to feel that you’re patronizing
    them.
  • Summarize the problem – describe in your own words, what you understand the problem to be. Restating the problem lets the customer know you’ve listened and lets you know that you understood the situation correctly.

3. Deal with the person’s problem in the following way:

  • Find out what the person wants
  • Suggest alternatives
  • Share information
  • Agree on a solution
  • Follow up as necessary.

4. Dealing with angry customers on the telephone- Recognizing angry customers on the phone is more difficult than in person because there are no non-verbal clues to catch. The only ones you might be aware of are the aggressively angry ones. The anger of passive angry
customer is revealed through verbal clues – changes in the tone, speed or pitch of their voices. Once you have identified the caller as being upset, follow the steps listed above.
5. Dealing with provoked customers- Sometimes YOU mishandle a situation. You create an angry customer, or make an already angry customer even angrier. You have been extremely busy, under a lot of pressure, or do or say the wrong thing. When that happens, you have two choices:

  • first, you can admit your mistake and apologize
  • if you think the situation is serious enough, you can refer it upward to your supervisor.

Whatever you do, don’t ignore it!

Abuse
You are there to serve, not be abused! There are some things you are never obligated to take from your customers, the most obvious being profanity or physical abuse! There is only one way to deal with these situations — directly:

1. Don’t react. The customer who resorts to these behaviours is usually looking to provoke a reaction from you. They will use your reaction to justify their behaviour. Maintaining your cool is your best defense. It’s hard for the customer to play this game if you refuse to play.
2. Draw the line. Don’t bother quoting the rules — they don’t care about the rules. Simply make a clear and direct statement of the consequence should they choose to continue their behaviour. For example, “I can’t help you as long as you continue to use that kind of language. If you continue, I will hang up!”
3. Follow through. If the response is positive, continue the interaction. If they do not respond, follow through with the consequence. Then seek out support, perhaps from your supervisor. Be prepared to explain what happened. Be sure your business has a contingency plan for any serious customer problems such as pulling a gun or physical violence. It happens! Ensure all supervisors and staff know what to do.

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IDENTIFYING CUSTOMERS NEED; WHAT CUSTOMERS WANT NOTES

However good your product or service is, the simple truth is that no-one will buy it if they don’t want it or believe they don’t need it. And you won’t persuade anyone that they want or need to buy what you’re offering unless you clearly understand what it is your customers really want. Knowing and understanding customer needs is at the centre of every successful business, whether it sells directly to individuals or other businesses. Once you have this knowledge, you can use it to persuade potential and existing customers that buying from you is in their best interests.

Why Do Your Customers Need You?
Every business needs a reason for their customers to buy from them and not their competitors. This is called a Unique Sales Proposition (USP). Your USP can be identified by completing the phrase ‘Customers will buy from me because my business is the only
Your USP can change as your business or your market changes, and you can have different USPs for different types of customer or product. For example;

  • a stationery shop could offer a free same-day delivery service for its business customers within a local area – an effective USP for businesses that need fast delivery
  • the same stationery shop could offer a 5 per cent discount to businesses that spend more than kshs 500 a month – this would be a USP for cost-conscious customers
  • the stationery shop could also make sure it offers the most comprehensive stock of artists’ materials in the area – a USP for local professional or amateur artists

All of these USPs can be effective because they are driven by what the customer looks for when making a buying decision.

It’s a good idea to review your USPs regularly. Can you tailor your products or services to better match your customers’ needs? Consider asking your customers why they buy from you. This will tell you what they think your USP is – this may differ from what you think your USP is. It’s also useful to check constantly what your competition is doing. Remember – if your competitors are doing the same, your USP isn’t unique any more.

What Do You Know About Your Customers?
The more you know about your customers, the more effective your sales and marketing efforts will be. It’s well worth making the effort to find out:

  • who they are
  • what they buy
  • why they buy it
  • how they use your product

If you’re selling to other businesses, you’ll need to know which individuals are responsible for the decision to buy your product or service. For information on targeting decision-makers, see our guide on how to target the right people in an organisation. You can learn a great deal about your customer’s by talking to them. Asking them why they’re buying or not buying, what they may want to buy in the future and asking what other needs they have can give a valuable picture of what’s important to them.

Understanding customers’ needs and desires can help you tailor your product or service to better suit their needs. It may also highlight valuable developments you can make to your current offering, or indicate gaps in the market that you can fill with new products or services. See our guides on spotting market opportunities and how to develop new products and services. Strong sales are driven by emphasizing the benefits that your product or service brings to your customers. If you know the challenges that face them, it’s much easier to offer them solutions.

See our guide on the sales appointment.
It’s also well worth keeping an eye on future developments in your customers’ markets and lives. Knowing the trends that are going to influence your customers helps you to anticipate what they are going to need – and offer it to them as soon as they need it. You can conduct your own market research and there are many existing reports that can help you build a picture of where your customers’ markets – and your business – may be going. For information on market research, see our guide to market research and market reports.

Ten things you need to know about your customers
1. Who they are
If you sell directly to individuals, find out your customers’ gender, age and occupation. If you sell to other businesses, find out what industry they are in, their size and the kind of business they are. For example, are they a small private company or a big multinational?
Knowing this can help you identify similar businesses that you could target.
2. What they do
If you sell directly to individuals, it’s worth knowing their occupations and interests. If you sell to other businesses, it helps to have an understanding of what their business is trying to achieve.
3. Why they buy
If you know why customers buy a product or service, it’s easier to match their needs to the benefits your business can offer.
4. When they buy
If you approach a customer just at the time they want to buy, you will massively increase your chances of success.
5. How they buy
For example, some people prefer to buy from a website, while others prefer a face-to-face meeting.
6. How much money they have
You’ll be more successful if you can match what you’re offering to what you know your customer can afford. Premium, higher priced products are unlikely to be successful if most of your customers are on a limited budget – unless you can identify new customers with the spending power to match.
7. What makes them feel good about buying
If you know what makes them tick, you can serve them in the way they prefer.
8. What they expect of you
For example, if your customers expect reliable delivery and you don’t disappoint them, you
stand to gain repeat business.
9. What they think about you
If your customers enjoy dealing with you, they’re likely to buy more. And you can only tackle problems that customers have if you know what they are.
10. What they think about your competitors
If you know how your customers view your competition, you stand a much better chance of staying ahead of your rivals.

Obtaining Information On Your Customers
Once you have identified what you need to know about your customers you can start gathering the information together. There is a huge amount of market information available that you can tap into. Much of that information is available free of charge and is readily available. For example, your customer records will tell you which customers have purchased from you, what they purchased, when they placed their orders and how much and how often they buy.

If your current data doesn’t provide you with the information you need, it is often worth asking customers directly. You can do this in face-to-face or telephone interviews, online surveys or in group discussions.
Other sources of free customer information include:

  • business contacts
  • local business reference libraries
  • your local authority, Business Link or Chamber of Commerce
  • the internet
  • UK Trade & Industry for information on export markets

If you can’t find the information you require from these free sources, you might decide to buy the information you require. There is a huge amount of commercially published information that you can purchase direct from market information publishers. Alternatively, you might decide to employ a market research agency or freelance researcher to get the information you need. It can be more cost-effective to use the services of a professional, although you will need to ensure you draw up a clear brief and budget.

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INTRODUCTION TO CUSTOMER CARE NOTES

WHAT IS CUSTOMER CARE?
Customer care involves putting systems in place to maximize your customers’ satisfaction with your business. It should be a prime consideration for every business – your sales and profitability depends on keeping your customers happy. Customer care is more directly important in some roles than others. For receptionists, sales staff and other employees in customer-facing roles, customer care should be a core element of their job description and training, and a core criterion when you’re recruiting.

But don’t neglect the importance of customer care in other areas of your business. For instance, your warehousing and dispatch departments may have minimal contact with your customers – but their performance when fulfilling orders has a major impact on customers’ satisfaction with your business.

A huge range of factors can contribute to customer satisfaction, but your customers – both consumers and other businesses – are likely to take into account:

  • how well your product or service matches customer needs
  • the value for money you offer
  • your efficiency and reliability in fulfilling orders
  • the professionalism, friendliness and expertise of your employees
  • how well you keep your customers informed
  • the after-sales service you provide

Customer service, especially in the shape of a call-centre – is to customers one of the most visible and significant aspects of organizational performance.

To many organizations however customer service is one of the most challenging and neglected areas of management, including those with modern call-centres.
For customers the quality of customer service determines whether to buy, and particularly whether to remain a customer.
Think for a moment how you yourself behave as a customer. You can perhaps think of an occasion when poor customer service or an unhappy exchange with a call-centre has driven you to leave a supplier, even if the quality and value of the product or service itself is broadly satisfactory.

The significance of customer service eludes many senior executives, let alone the methods of establishing and managing customer service standards and quality. Our own experiences as customers demonstrate all the time that many large organizations fail particularly to empower customer-facing and call-centre staff, and also fail to design policies and systems to empower customer-facing staff and enable effective customer service. Often these are defensive strategies because staff are not trusted, and because competition is feared, or because simply the policymakers and systems-designers are too far removed from customers and their customer service
expectations.

Pricing strategy also plays a part on customer service – especially strategies which effectively discriminate against existing customers in favour of new customers, which in certain situations borders on the unethical, never mind being stupid in a customer service context. This is strange since by any reasonable measure or criteria – in any market or industry – it costs far more to gain new customers than to retain existing customers. Neglecting, constraining or failing to optimise customer services capabilities is waste of great opportunities. Instead many organizations and their leaders are habitually fixated on sales, marketing, advertising and promotion – desperately striving to attract new customers – while paying scant regard to the many customers that are leaving, just for the want of some simple effective customer service and care. We see this particularly in highly competitive and profitable sectors
such as communications and financial services, where new customers are commonly extended better terms and attention than existing customers. No wonder customer turnover (‘churn’) in these industries can reach levels exceeding 25%. Leaders and spokespeople will blame the competitive market, and the fickleness of customers, but ultimately when a customer leaves a supplier it’s because they are unhappy about the service they are receiving – otherwise why leave?

Benefits of effective customer service
The central aim of effective customer service and call-centres is retaining customers, but when an organization gets this right the acquisition of new customers – and so many other things – automatically becomes much easier too.

Retaining customers – enabled by excellent customer service – produces many positive benefits for the organization aside from the obvious revenue and profit results:

  • Retaining customers through effective customer service enables easier growth, indirectly and directly, for example by sustaining healthier volumes and margins, and by business expansion from word-of-mouth referrals.
  • High levels of customer retention via effective customer service also improves staff morale and motivation. No-one enjoys working for an organization that feels like a sinking ship, or where stressful arguments or pressures prevail. When customers are happy, all the staff are happier too – and more productive.
  • Improved staff morale and motivation resulting from reducing customer attrition also positively benefits staff retention and turnover, recruitment quality and costs, stress, grievance, discipline and counselling pressures.
  • Reduced customer attrition and upset naturally reduces litigation and legal problems, from customers or fair trading laws.
  • Retaining customers also enables the whole organization – especially middle-managers – to focus more on proactive opportunities (growth, innovation, development, etc) rather than reactive fire-fighting, crisis management, failure analysis, and the negative high pressures to win replacement business.
  • Having a culture of delighting and retaining customers fuels positive publicity and reputation in the media, and increasingly on the web in blogs and forums, etc. The converse applies of course, when nowadays just one disgruntled customer and a reasonable network of web friends can easily cause a significant public relations headache.

For these and other reasons the cost difference and relative impacts on organizations between gaining and retaining customers can be staggering. A useful analogy is that only a fool tries to fill a bucket of water when the bucket has lots of holes. Better to fix the holes and stop the leaks before you try to fill the bucket. Especially consider the actual cost of retaining customers when all that many customers require is not to be upset.

While the trend is apparently for more people to complain (mobile phones and the internet make it easier to do so, and people are less tolerant than they used to be) this does not necessarily mean that customers are more likely to migrate to competitors. In fact these days time pressures and the ‘hassle factor’ combine to create huge inertia in people’s decision-making, which means although they might complain more, they have less inclination to actually change suppliers because of the time and inconvenience of doing so. There are arguably some exceptions in fast-changing sectors, but largely inertia tends to make it more likely for customers to stay than go.

People behave like organizations, when the true costs of change in time and hassle are recognized often to be greater than the savings that the change will achieve. Consequently most people prefer not to change suppliers – they have better things to do with their time – which means that retaining customers should actually be easy – if only organizations would attend to the basic customer service principles and keep customers happy. In short, customers largely don’t usually leave unless they are upset enough to do so.

Contrast the cost of achieving happy customers – virtually zero aside from normal customer service and operating overheads required to run a business – with the costs of marketing, advertising, selling, sales training, sales management, credit-control and account set-up, that necessarily arise in the acquisition of new customers. Consider also that the main factor in keeping a customer – even if the situation appears irretrievable – often comes down to a simple apology or update – just by keeping someone informed and avoiding upset – and compare this with the huge costs of acquiring a new customer. It is then easy to see that the costs of gaining a customer can be five, ten, a hundred or a thousand times greater than retaining a customer.

And yet from the customers’ view many organizations seem unaware or dismissive of the need to prioritize great customer service above many other perhaps more exciting or fashionable initiatives – typically related to sales, marketing, advertising, technology, the web, etc. These high-profile customer acquisition activities, plus systems, policies, procedures, training, etc., all play a major role in running a high-quality organization, but the glue which holds it all together for the customer – and often the only thing that really matters to the customer, is the quality of customer service that the customer feels and experiences.

Within customer service there are many elements which must be organised to make effective customer service happen properly – pricing strategy is important of course – but the crucial constant factor is the human element – how people are treated and communicated with – because simply, customers are people, and people tend to behave like people and respond to people – they
do not behave like computers, and they do not respond like machines.

Policies, systems, technology all enable customer service, but none of these actually determines effective customer service. Only people – your employees – can do this, particularly when serious problems arise which by their nature must be escalated to a ‘real person’.
People – your employees – also (if encouraged and enabled) perform another critical customer service function – that of giving feedback and suggestions to improve customer service systems, policies, processes, technology, etc. Often policies and technology are dreamt up by managers or consultants working away from the actual day-to-day customer-facing activity. Feedback and recommendations from customer service staff – and customers too – are vital in refining and improving the systems and policies within which the function is operating. So again, people – your employees – are the most crucial in shaping effective customer services capabilities.

Ignorance and avoidance of these factors is a problem, but also a big opportunity. Where customer service is neglected and ignored the function is powerful lever waiting to be pulled.
Improving customer service – especially empowering and listening to customer service staff – offers many organizations a bigger return on investment than any other initiative. Customer service is generally the critical factor in determining whether a customer buys and is
retained, which is ultimately what the organization exists to do – to serve and retain customers.

Understand Your Customers
In business-to-business trading, providing a high level of customer care often requires you to find out what your customers want. Once you have identified your most valuable customers or best potential customers, you can target your highest levels of customer care towards them. Another approach, particularly in the consumer market, is the obligation to treat all consumers to the highest standard.

Collect Information About Your Customers
Information about your customers and what they want is available from many sources, including:

  • their order history
  • records of their contacts with your business – phone calls, meetings and so on
  • direct feedback – if you ask them, customers will usually tell you what they want
  • changes in individual customers’ order patterns
  • changes in the overall success of specific products or services
  • feedback about your existing range – what it does and doesn’t do
  • enquiries about possible new products or services
  • feedback from your customers about things they buy from other businesses
  • changes in the goods and services your competitors are selling
  • feedback and referrals from other, non-competitive suppliers