InformationWeek

October 5, 1998

The Service Imperative

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Illustration by David Wink

Novus Services lets its Discover Card holders check their records online. Novus, also recognized by J.D. Power for customer satisfaction, lets customers access via Web browsers the same account information that service reps see. In the future, online statements may be customized to individual users. Increasingly, says CIO Floyd, customers will want to manage their accounts without Novus' help. Novus expects the self-service trend to take some of the pressure off its extensive call-center operations, which handle 40 million calls a year.

BellSouth customers can sign up for new services on the company's Web site. CIO Yingling says Web-based self-service can be more accurate than going through a call center because data is entered directly into back-end applications. "The Internet, with its ability to mix text, graphics, video, and voice, has potential that phones can't match," he says.

Still, companies need to be careful not to take the self-service concept too far, too fast, warns Maura Burke Weiner, a consultant with the Service Impact Group. "Technology is improving service for some customers," she says, "but making it worse for others." The risk is that voice-response systems, self-service Web sites, and other automated systems are poor substitutes for an attentive service rep in some situations.

The Leverage Of Feedback
And what do customers think about the products and service they receive? Consultant Weiner says not enough companies have a good answer to that question. "This is a huge opportunity," says Weiner. "I'm shocked that companies don't leverage customer feedback more."

Some do. Community Playthings uses its customer database to compile lists of organizations that buy school furniture and equipment, and then surveys those organizations on how to improve its products. "It's a much more responsive way of getting design input so we can be quicker to respond to needs in the marketplace," says database administrator Potts.

Not Well Connected

Staples loads 10,000 customer comment cards it receives each month into a custom application that runs on an IBM AS/400 computer. Staples generates customer-service reports on in-store help, product availability, and other categories, and shares the results with employees at all levels. Customer suggestions contained in the reports have been the basis for new product introductions and for making changes to the format of its sales receipts.

At Staples, customer service figures into employee compensation and the company's bottom line. Executive and manager bonuses are tied directly to the customer-service cards and two other customer-service programs. The results are telling. Customer-service complaints dropped 40% over the 12 months ended in the second quarter of 1998. And sales in the company's most recent fiscal year increased 31%, to about $5 billion. At its current rate, Staples is opening a new store every 51 hours.

The Ritz-Carlton Hotel Co. in Atlanta pampers its repeat customers using a "guest recognition system" that is input with data on a customer's individual preferences. The system, which has been in place for nearly 10 years, is credited with improving customer service and creating customer loyalty, says Bruce Speckhals, VP of information systems with the hotelier. Significantly, though, Ritz-Carlton isn't standing still. The organization recently upgraded the system--a Windows-based application that runs on an Informix database, accessible across a WAN to all of its 35 properties--with the help of systems integrator Cambridge Technology Partners.

Ritz-Carlton wants its customers to relax. That's why the hotel chain and companies like it are sweating the details.