Business benefits and ROI

Carla Thomas, General Manager, Service Performance and Improvement, at Openreach explains why TrainingMark has delivered business impact for her organisation.

Helen Gorrell, Operations Director of Next Gear Capital explains how a customer service framework helped build an engaged workforce, drive up customer satisfaction, achieve accreditation and drive return on investment.

As the power behind energy efficiency, IMServ provides energy data and metering services to a range of customers. They include the energy suppliers, organisational energy users (companies) and energy management partners such as energy consultancies or brokers. Monitoring around 275,000 metering points remotely and covering 25% of the UK’s electricity consumption through its network, the company collects approximately 80 billion units of energy data per year. IMServ provides multi utility solutions, gas, water and electricity, with its key expertise within the electricity industry.

Headquartered in Milton Keynes with 350 employees, the company has been operating for 25 years now and is one of the leading players in the complex business of energy consumption data and analysis. The Energy industry is increasingly a highly competitive market, undergoing significant change, meaning that levels of customer service can be an important differentiator.

Service on the agenda

It was about five years ago that senior management at IMServ realised they needed to do more around the service agenda. Steve Brown, Managing Director at IMServ, explains: “We got to a point where we were conscious that our levels of both customer service and employee engagement were not where they needed to be. Anecdotal comparisons with competitors showed that we weren’t necessarily any worse than them, but we wanted to be better than the average of a mediocre bunch!” So it was that, in 2012, the company became members of the Institute of Customer Service and began to work towards ServiceMark accreditation.

“We were particularly keen to improve employee engagement levels because we understood the link between engagement and customer service and wanted to create that virtuous circle, which could then help differentiate us in the market,” Steve says. “So we were clear about what we wanted to do, but we didn’t have the framework to deliver it on our own.” The Institute and ServiceMark provided that framework. That was the real value add. The company achieved ServiceMark in 2013 and has recently been reaccredited for a further three years to 2020. Satisfaction scores have improved in both the Business Benchmark survey of customers (from 72.5 to 78.7) and the employee survey (from 79.6 to 80.6).

Culture shift

The process, which Steve describes as challenging, generated a number of key insights and changes. “We realised that we needed to shift the culture slightly because we had a very operational mind-set,” Steve explains. “But sometimes the customer doesn’t care as much about operational nuances as we think they do. They just want to know what their data shows, not so much the technical detail behind it. So it was about aligning our operational delivery with customer service more effectively.” There were also some significant internal changes that came about as a result of ServiceMark and the recommendations provided by The Institute as a result of its independent assessment. Firstly, in order to improve collaboration between teams, IMServ reorganised how the teams sat in the office to reflect the’virtual data production line’ of their services to the customer.

Staff empowerment

Secondly, they introduced a system of management business information boards that showed the KPIs for the operational teams and performance against them and started a schedule of regular team talks in which these boards were discussed. “This improved performance awareness and collaboration between teams,” Steve says. “Importantly, the KPIs were not the Board’s KPIs, they were derived by the teams themselves, according to what mattered in their own roles. So there was an empowerment process at play in giving staff the ability to shape what was measured and managed.

Another area of focus was on improving two-way communication with the company’s meter technicians and readers, remote workers who represent nearly one third of the workforce. “Their engagement scores were low. Improving their engagement also improved their efficiency, so there was a double benefit,” Steve observes. In addition to ServiceMark, the company has also undertaken some of the Institute’s ServiceFocus training programmes after learning and development came out with low scores in the employee surveys. IMServ has also appointed its own training manager to help in the development and delivery of training.

Top quartile

The result of all these efforts is that the company is now in the top quartile for service amongst its peers, meeting their original objective. “It’s not exaggerating to say that there has been a complete turnaround in employee engagement and customer satisfaction since we began the process,” Steve says. “We already had things we wanted to change, but working with The Institute has significantly helped us on the way and enabled us to really put a focus on it.

Working with our Client Relationship Director has helped us think differently and more broadly as a management team.” The payback of all these initiatives has been palpable. Having lost a major retail customer a few years ago because of service issues, they have recently won them back and the customer is very satisfied with service. IMServ hasn’t lost a major supplier or energy management partner in the last three years. “We grew revenue by 10% last year and it’s up 20% this year to date. It’s difficult to establish a precise link of course but I have no doubt that if you create that virtuous circle of engagement and service, it feeds off itself,” Steve says. The company now also runs two major projects every year, one on the customer side and one on the employee side. This year’s customer project is around installing a new CRM system and also dealing with complaints more effectively, while the employee project involves the company’s internal ‘WeEngage’ team running Food For Thought sessions to air any issues and ideas amongst staff.

“A few years ago if you walked around the office, you could sense that things could be improved,” Steve reflects. “Now, walking round you can sense an energy and a feel-good factor. We know we can’t ever afford to ease up, that if you stop continually emphasising service things can go backwards, but we’re certainly on the right path.”

Watch Sandie Dunn, People Development Manager at Legal & General, highlight why customer service qualifications are important and how working with The Institute of Customer Service has helped the company improve its service levels.

The company’s operations are extensive. It services some 2.4m domestic households and 160,000 businesses in Scotland. With a turnover of £1.2bn per year and employing around 3,750 staff, it is the fourth largest water company in the UK. With such a large customer and geographical base to cover (30,000 square miles), it is not surprising that Scottish Water has a very busy workload. It deals with, for example, around 40,000 sewer blockages a year. Service standards, therefore, are an absolute priority.

High aspirations, Scottish Water’s commitment to customer service is in part driven by its regulator, the Water Industry Commission for Scotland, who sets the service (and efficiency) standards that it must meet during each regulatory period. The company has in fact set itself even higher standards that it aspires to reach. It benchmarks itself not merely against other utilities but against other leading service providers in different sectors.

Peter Farrer, Chief Operating Officer at Scottish Water, who has responsibility for both operations and service, says: “Customer service is fundamental to what we do. We have proven that you don’t have to be a private company to deliver leading levels of service. We’ve also shown that, with the right focus, it is possible to drive up both customer service and operational efficiency at the same time.” The company has taken customer service seriously for a long time. Nine years ago, it introduced a ‘Customer Experience Measure’ whereby customers who have dealt with Scottish Water receive a survey asking for their views on their experience.

When this started out, it was done every six months to a sample of 1,000 customers. In the last few years, however, the company has significantly expanded this so that any customer interacting with the company receives a survey, sent to them by the same channel as they contacted the organisation through (phone, email, social media etc). Response rates are impressive, with around a quarter of surveys being completed, meaning that the company receives 1,000 to 1,500 pieces of detailed customer feedback every month.

Driving culture change

This expansion of the Customer Experience Measure is one of the things that Peter Farrer has introduced since becoming a Board Director in 2009. But he has also deepened the level of information captured so that a customer’s satisfaction can be taken right down to an individual operator level in the contact centre or the field. League tables are produced at an individual, team leader and manager level.

“This has driven a real culture change. It’s one of the ways we’re doing things that not many other utilities are,” Peter explains. “Nobody wants to be at the bottom of the league table! But we don’t just use the information for coaching purposes around areas for improvement, we also use it for positive and motivational purposes, such as positive reinforcement when a customer praises an individual or team for great service. It gives us such a rich seam of information. We have recently introduced the Customer Experience Measure for businesses too.”

Longstanding member

Another important facet of Scottish Water’s commitment to customer service is its membership of The Institute of Customer Service. Again, this is an area that Peter has driven significant changes to since becoming Chief Operating Officer. Scottish Water is in fact one of The Institute’s earliest members, joining in 1999. But for many years the company largely confined itself to working with The Institute on the training of its front end customer service staff.

Peter became a Board Member at around the same time as Jo Causon became CEO of The Institute. As one of The Institute’s largest members, Jo came to visit Peter early in her tenure. “We made a great connection,” Peter recalls. “I was very impressed by Jo’s passion and enthusiasm for improving standards of customer service, and I think she was impressed by our focus on it too.” Jo invited Peter to become a Vice President of The Institute. The Vice Presidents don’t sit on the Board itself but meet regularly in an advisory capacity. “Being a Vice President means that I rub shoulders with other senior executives from some of the best customer service organisations in the country,” Peter says. “We can share learnings and experiences, and I can take things back to try them at Scottish Water.

Matching the best

The company also makes much greater use of some of The Institute’s products and services such as the UK Customer Satisfaction Index (UKCSI), which surveys 10,000 individual customers of organisations across 13 sectors. The Institute has also provided an additional benchmark based on the responses of Scottish customers in the UKCSI. “Previously we didn’t utilise the UKCSI, but now it’s one of our fundamental business measures,” Peter says. “We use it as a means to benchmark ourselves not just against other utilities but against leading providers of other essential goods and services. Utilities are one of the poorest performing sectors in the UKCSI so we don’t want to just be the ‘best of a bad bunch’, we want to match the best, full stop. We have to be realistic though, because we’re always going to struggle against the likes of Amazon or John Lewis with whom customers have such regular interaction. That’s why we are targeting leading levels of service provided by other providers of essential products and services like Food Retail. Water is still a ‘silent service’ for many, but we’ve been doing pretty well, near the average across all 13 sectors. That’s good, though we still have further to go.”

The company has also achieved ServiceMark, a national accreditation awarded by The Institute, that recognises an organisation’s achievement in customer service – and was in fact the first large multi-site organisation to obtain it. Last year it gained re-accreditation. Peter reflects: “Whereas the UKCSI is in effect a lag indicator of how you have been doing, both ServiceMark and the employee survey ServCheck, are cultural indicators of how you’re performing. So they are really important to us too. ServiceMark, with its absolute scores that you have to meet, sets a high standard. We have also spent a lot of time with The Institute redesigning our various in-house training programmes for staff.” Another area the company has been involved in is The Institute’s forum on providing service to vulnerable customers. This has led to it linking up and working closely with electricity distributor Scottish Power Energy Networks. “That’s one of the many spin-offs at all levels from our involvement and participation with The Institute,” Peter says.

Holding up the mirror

Results have been going well. When Scottish Water first featured in the UKCSI nine years ago, satisfaction using their own real time Customer Experience Survey tool was at 60%. Now, they are consistently hitting 90% or more. The ‘Your Voice’ employee survey meanwhile, which is run independently, has an 80% return rate with engagement scores improving from 50% to around 70% in the last five years. “I don’t think there’s any doubt that working with The Institute has had a fundamental impact on our progress,” Peter says. “The regulator plays an enormous role, setting the standards we have to meet, the hygiene factors if you like. But with The Institute we have awoken to the art of the possible, setting our own agenda on how far we want to push service standards over and above the regulatory targets. The Institute has held the mirror up for us and made us look across all of the other 12 business sectors too. They have given us some lightbulb moments.”

The company’s Food & Water division, with 5 sites throughout the UK, is one of the UK’s biggest testers, carrying out some 8 million tests annually. Open for business 365 days of the year, and often needing to test into the early hours in order to meet customer deadlines, the work is fast-paced and can have unpredictable peaks.

The division’s work plays a hugely important role as part of a safety regime which protects and informs the public, testing that food is safe and contamination-free, checking and verifying nutritional claims and labelling (including for example that a product is ‘nut-free’), and substantiating the authenticity of food products too, think of the horsemeat scandal from a few years past.

Around 80% of the division’s work is food testing, with the other 20% involving testing the quality of water (important for water processing plants or for renal units, for example, in hospitals). “A demanding environment.” Mike McCorkell, Managing Director of the UK Food & Waters division at ALcontrol, explains: “We have 50 vehicles that collect food samples from manufacturers daily and for food safety tests we have to process them straight away. Most of our testing is pre-scheduled but even so we don’t usually know until the day it’s actually due to arrive what the volumes will be. So it can be quite pressured getting through the work and we rely considerably on the engagement, flexibility and goodwill of our staff to get the job done well. Not only can the work be pressured for staff, but the results can also lead to high stress situations for their customers. Listeria for example, in a manufacturer’s sample, then we have to break what is obviously a piece of very bad news to them,” Mike comments, “You’ve got to do that in a sensitive and human way , one of the areas where the need for excellent customer service really comes in.”

A customer service journey

It was four years ago when the company was consolidating some of its sites that it really occurred to Mike that a radical change to a more customer service focused approach was needed. “We were in danger of being too transactional in our dealings with customers, treating the work like a Lean production line. Our organisation was perhaps somewhat introverted as well, working hard under the bonnet but not communicating enough with customers in an engaging way. Mike recruited an experienced service and engagement expert, Julia Bloomer, from the steel industry (another tough industry, fighting hard for marginal gains) to supplement his team and together they set ALcontrol off on what has been a fruitful and rewarding journey.

Julia had experience of The Institute of Customer Service from her previous role, and enrolled the Food & Water division as a member too. Since 2013, the company has made wide use of The Institute’s products and services, including putting many of its staff through training programmes, such as FirstImpressions and ServiceManagement, using Business Benchmarking putting leaders and managers through Institute training qualifications for Communication, Solutions, Innovation and Coaching obtaining one of The Institute’s most prestigious accreditations, ServiceMark.

ServiceMark requires an organisation to carry out a survey of its employees to benchmark engagement; a survey of customers to gauge their level of satisfaction; and have an independent assessment carried out by an Institute representative. All three components require challengingly high scores in order to achieve the accreditation.

Julia Bloomer says: “There’s no doubt that being members of The Institute has really paid off for us. It’s benefited us in lots of different ways. Obtaining ServiceMark was the icing on the cake if you like, although for me the most important thing isn’t obtaining the accreditation, it’s the journey to get there and the things you learn along the way. The journey is still ongoing too. We’re the only commercial laboratory in the country to have ServiceMark so it stands out as a truly independent verification of our standards. Some of our competitors promote in-house survey results but without any facts or confirmation, so it’s a great achievement for us.”

Return on investment

And it’s not just a nice piece of paper or a plaque for the company to display, it has led to real return on investment. The food testing industry is a price sensitive marketplace, and margins are low. Getting fairly rewarded for work and making a sustainable profit can be challenging. Obtaining ServiceMark along with other Institute programmes, and achieving the underlying service standard that enabled this, has helped the company to swim against the tide on price. What it’s done for us is given us the knowledge and the confidence to increase our pricing in a fair way, knowing that our customers recognise our service offering too and will stay with us. So it’s had a direct commercial benefit,” Julia says.

Other programmes have led to financial benefits as well. “In the FirstImpressions training course, you have to come up with an actionable plan to improve an aspect of the business. One lady came up with a suggestion to plug a previously unseen revenue leakage around the way we invoice for agreed carriage charges which led to a £10,000 increase on the bottom line every month,” Julia says. “The training people go through has given them a voice and a sense of people power, that’s a return on investment in itself.” Putting the focus on customer service has paid off in multiple ways. Customer retention now stands at 95% compared to 85% four years ago; the average selling price per test has increased year on year for four consecutive years; employee retention has also increased; while the average employee engagement score has risen from 50% in 2012 to 84% now.

Seismic cultural change

“We’ve had a seismic cultural change,” Mike McCorkell observes. “We have a much improved workplace where people enjoy their jobs and are proud to tell their friends and family what they do at work. It is pleasing that when customers visit or audit they pick up on the vibe and comment on it and can see that we’re doing a good job. I’m proud to say that we love to let customers loose on site!” Julia adds. “We can let them stop and talk to anyone, anywhere. I don’t know how you put a price on that. Around 75% of the company’s 420 staff have now been on at least one Institute training programme and the aim is to get that to 100% in time. We benchmark ourselves with great service leaders in other industries, not specifically the food testing business which perhaps is less mature in developing service leadership,” Mike says. “I think we’ve created something quite unique, we’ve built a strong ethos around being a great place to work dedicated to great service, creating quality opportunities and careers for people.”

Other divisions in ALcontrol are now on the same journey, adopting a similar customer service focused approach and working to the same ‘value cycle’ where engaged staff drive great service helping the business gain a fair price and sustainable profitability. A commitment to customer service is now deeply embedded.

Whether it’s known as Marks & Spencer, ‘Marks and Sparks’, or simply ‘Marks’, the M&S brand is an icon of the UK retail environment. Like any brand that has stood the test of time, M&S has had to change with the times. In 2004, the business embarked on a strategy to infuse what had been a ‘product-centric’ approach with a culture of customer service. That strategic drive remains in place to this day, reflecting the wider move in UK businesses towards the new, ‘relationship economy’. As Head of Customer Service at M&S, Jo Moran was originally in charge of promoting high standards of service in the traditional retail arm of the business, but since 2008 has taken on responsibility for the entire organisation.

Great service is part of the brand

Jo heads up a management team that focuses on customer service centres, together with a smaller team that focuses on the retail experience. Both teams are geared around ensuring all M&S employees deliver the consistently great customer experience that is so much a part of its brand. While the service values are consistent, there is huge range and variety in how they might be delivered. As Jo says: “I’m responsible for customer service across the brand. How that looks and feels in our store, in our customer service centres, customer contact by phone or email, letters, social media, even down to the home deliveries experience.” With the challenge of ensuring customers experience the same service values across all these touch points, Jo and her team use The Institute of Customer Service’s National Customer Service Week (NCSW) to remind everyone that they are truly involved.

A drumbeat throughout the week

NCSW runs during the first full week of October and M&S have been taking part since 2012. Jo describes it as ‘a marker in the diary that you know everyone is going to get behind.’ “Each year has been better than the last, both in terms of the NCSW experience and its business outcomes for M&S.” She says: “This year has clearly been the best yet. The support and structure coming out from The Institute provided a real drumbeat throughout the week, that we could build around.” Jo announced the NCSW early to her heads of region and frontline managers with both emails and conference calls. “We had a longer run-in around the communication of the week” she recalls, “so we could galvanise people and do more around recognition and rewarding great service.”

A framework for engagement

M&S used themes The Institute provided, running from ‘understanding your customers’ and ‘dealing with problems’ to ‘recognising the business impact of customer service’, to generate a toolkit suggesting daily activities for retail stores and service centres. Meanwhile, for the duration of the week, M&S used its internal social network, Yammer, as the place for employees to share their customer service stories and experiences and a budget was raised to reward customer service excellence wherever it was found. In just seven days, M&S recognised and rewarded 567 individuals who had provided exceptional customer service. The national event provided a framework to further promote customer service within the company and see staff actively engage with its values.

I can see the return on investment

M&S has been a member of The Institute for the last five years, and has just renewed that membership for a further four, to gain further assistance as the business continues to move with the times. Being a retailer with one foot on the High Street and one foot in the digital space brings its own particular challenges. “Online is a faster moving environment” says Jo. “How do we act in a more agile and responsive way on customer feedback particularly in regard to social media? They are ahead of us in terms of multi-channel; customers think multi-channel just as a matter of course, and how we join that experience up is really important.”

Jo believes the best approach is to take a broad view, using insights from The Institute to spot examples of good practice wherever they may be. Meanwhile, the company’s own training materials are accredited by The Institute, to ensure they always reflect the latest research. “It’s essential to look outside your own sector” says Jo. “The Institute gives us an independent, UK-wide perspective on customer service. And it’s valuable to get that external review and verification on how our people are trained.” Ultimately, it was Jo’s decision to renew M&S’s Institute membership “ it wasn’t a difficult choice. I can see the return on investment from the work we’ve done so far” she says. “I was happy to sign that budget off.”