Photo by Sebastian Pena Lambarri on Unsplash
Two weeks back I had visited a shop to get one of my electronic devices repaired. This is one of the larger shops in the area with a good name in the market place. Almost exactly a year back I had gone there for getting something else fixed and was very satisfied with the quality and timeliness of their work. This time I sought out the same employee who had given me the service last time; he recognised me despite the fact that the last time and this time I had my face mask on. As usual he gave me crisp advice on the fix, cost, and duration. The next day as promised he gave me the repaired device, a job well done as usual. When I collected the device from him, I enquired with him about an accessory for the device, pointing to the shelf that stocked these items. To my surprise, he told me that this particular accessory is being sold as a premium-priced product there and advised me to instead get my need fulfilled by buying a much cheaper product from any smaller shop at almost one-tenth the price. I followed his advice.
This incident made me feel positive about human relationships. At the same time, it made me think about what constitutes value to a customer and how it manifests across brick-and-mortar and digital businesses. Customer value modeling is a well-researched subject. Underpinning this, Maslow’s hierarchy of needs is a simple but deep representation of what drives human need, how they evolve and interplay. Bain & Co. looked at this from the perspective of what is perceived as value by a customer and defined an “Elements of Value” pyramid (see depictions below).
Both these models are very useful for businesses across industries to shape their product and service strategies. In fact, the value pyramid is a very useful model to trigger startup ideas; take a particular industry, see where there is a value gap today and create a solution to fill that gap.
Going back to the incidence at the shop, I wondered which of these values is the most essential for a business to provide to its customers. Bain’s research across industries shows “Quality” as the standout common denominator. While there is not much debating this, I strongly feel the value much more fundamentally essential in any business-to-customer relationship is Integrity (and Trust resulting from this). To be pedantic, in Maslow’s model this straddles across “Safety” and “Belonging” and in the Bain model across “Reduces anxiety” and “Affiliation/belonging”.
As most businesses increasingly provide their products and services today digitally, how do you design digital products and the surrounding business processes to ensure the Integrity value is preserved and protected across every touch point with the customer? Here are a few thoughts:
- The simpler the product/service, most customers will prefer the less-hassle route of getting it through digital channels without human intervention wherever possible. More complex products/services will need to be the other way – more human handholding while providing easy digital access to information.
- With increased use of chatbots and digital assistants for interactions with customers, it is important to seamlessly interweave digital and human assistance. Often we see businesses use the flawed and short-sighted strategy of implementing bots mainly as a cost-cutting tool, when what really happens is that they are left with very dissatisfied customers not getting what they need out of these bots. When the bots are stumped for an answer, they typically ask the customer if she wants to speak to a service person; then after a long wait on the phone line, the customer ends up repeating the whole set of questions to the service person. While yes, the bots based on machine learning will do a better job as they learn more, the correct way of designing this is as a seamless conversation flow between the customer, the bot, and the service person. If the bot does not know the answer to a customer query, it should chat with the right employee immediately and convey back the answer or if the employee is free then give the chat control to the employee so he can carry on the conversation directly with the customer in a seamless way. Very few firms do it this way.
- Digital is fraught with risks of loss of privacy and personal information to the many cyber attacks possible in today’s world. Digital products and related business processes must operate within a comprehensive end-to-end security architecture that protects the integrity of the transactions and data. Within the financial world, banks still hold their competitive place against Fintechs primarily because they are regulated and obligated to protect the customer’s financial assets. Blockchain-based controlled data sharing and customer consent management is not too far away and will go a long way in getting privacy back into the customer’s hands.
- Integrity and customer trust are largely a result of the right culture that permeates an organization. How well the organization nurtures this throughout the firm at all levels will decide the longevity of the business and the customer loyalty. Given how tough it is to do this with people, is it even possible to transmit the same cultural values to the firm’s technology? Sure, there are many ways of doing this right. Some examples – providing the most critical and relevant information in the most obvious place for the customer to find (not hide it somewhere in fine print); give complete transparency to the customer on the status of each significant business process step; asking the customer for feedback just at the right moment (to be clear, only at logical completion of a customer request) and not bombarding the customer with calls or emails just for the sake of doing it; and taking each customer feedback seriously and acting on it.
- When a customer issue is not resolved, the customer always ends up following up multiple times and escalating within the business hierarchy. Digital products should automatically handle this escalation workflow using predefined internal SLA’s. Many a time the ball is dropped and the frustrated customer has to keep picking up the thread with various service personnel, sure fire way of losing a customer.
It is imperative that the design of digital products and processes takes into consideration a proper balance between automation and humanization, essential for customer retention and business growth for the long haul.
Ramki Sethuraman
