The Escalation Problem

A couple of months ago, Shachin Bharadwaj, founder of TastyKhana in Pune, sent me this Twitter message... 

This was in response to...

Just days later, I faced an almost similar situation. I was trying to buy some products urgently for my home and reached out to the relevant sales guys in Pune. For almost a week there was no response, in spite of several calls and messages. Finally, I called a friend who is a senior manager in that company. Although he was not responsible for this line of products, I called him on a Sunday morning, having run out of ideas. Within an hour, the sales guy called me asking for the details.

I receive several "escalations" from customers and friends, even though I am not in a "line" role... I am sure those who are in business sales / marketing or customer service leadership roles are inundated with escalations. Why does this happen? Why is it that large organizations - usually - are often unable to handle sales or customer service issues at the operating level? Surely they realize that "escalations" are not good for them, not only from a reputation perspective but also from a cost point of view.

Corporates would argue that such escalations are few, relative to the overall number of transactions that they manage, and therefore, statistically insignificant. If you have a 100 million subscribers with 10 "transactions" each, even a 99.9% quality level would still leave a million "failed" transactions. The best businesses would have (or aspire to) lower failure rates, however, it is impossible even for them to achieve 100% out of their operations. 

Earlier, they could have gotten away with it. An individual (customer) had limited ability to influence others or have her voice heard. An aggrieved customer could write to the company's senior management or to a publication and hope that something would come out of it. Perhaps some would go to a consumer court. Things have changed today. One aggrieved customer (even if accounting for the fourth decimal of all transactions) can ruin a company's carefully crafted (usually at huge expense) image.

The only way to get it always right is if every member of the organization focuses on solving customer issues or preventing the creation of any issues. How often does that happen? I can think of three main reasons why issues do not get addressed at the operating / first level and lead to dissatisfaction, frustration and inevitably, escalation.

1. Lack (or Mismatch) of Incentives

What are the most popular metrics for customer service organizations? Call centre staff are usually measured on number of calls, hold time, etc. A telecom service engineer is measured on network uptime, capacity utilization, etc. Very rarely are they tasked to enable happy customers. Customer satisfaction indices become part of larger corporate imperatives and company performance scores. I have not seen too many companies that directly measure (and consequently, incentivize) customer satisfaction - satisfaction that is tracked at an individual transaction level and not at the aggregate in an annual or quarterly survey. 

Similarly, a sales person is tasked to maximize new sales or revenues; most companies have complex commission structures that encourage sales of certain products (or to certain segments) over others. A sales person inevitably follows the money. If you are not a "priority" customer segment or seeking a low-value product, the sales guy has no interest in you, period. In my case where the sales folks showed no interest in my order, I suspect that there is no (or very little) incentive for sales to a "group" employee, so why would a sales guy waste time on my order when there are other deals to pursue in the market?

2. Lack of Empowerment

What are you willing to do to solve a customer issue? Ask any senior manager and you will always hear the answer, "Anything, customer is king." Unfortunately, that message rarely reaches the line staff -- not from a communication perspective, mind you, but in terms of policies and delegations. Does the organization recognize and celebrate moments when difficult customer issues were resolved speedily? Were employees who went out of their way to solve the problem rewarded immediately? Or was the first reaction of the management to conduct a cost-benefit analysis of the event?

Empowerment is also in terms of information. Customers are, mostly, not irrational. They understand that things/systems/machines do fail. What they'd like to know is why, and more importantly, how/when will the issue be resolved. I have never seen a customer service executive that has been empowered with such information. In the absence of facts, the CSE responds with vague promises and a generic assurance of resolving the issue within 24 hours or 48. 

A few years ago, my broadband connection was down and every time I called, I was told the issue would be resolved "soon". A week later, the connection was still down and my blood pressure was up. After a few rounds of escalation, I learnt that some equipment had been damaged due to a short-circuit and that the new equipment was waiting for the electricity department's go ahead for reconnection. This permission was awaited and could take a few more days; the telco could do nothing about it. Fine, but if only I had been informed earlier, I might have made other temporary arrangements for Internet connectivity without staring at the modem daily or shouting at the customer service staff. 

3. Lack of Learning from Mistakes

Each escalation is a moment of learning. Why did it not get addressed at the level it should have been? What was lacking? Senior executives that receive escalations focus on the immediate solution (as they must) but often fail to deep dive into the real problem. Whether it is a change in incentives or a process, or a reprimand in case of negligence, something must change after each deviation from the norm of operations.

It is also important that even after an escalation, the issue be addressed by the operating teams. That sends a message to the operating staff as well as to the customer: the escalation was an exception, the point of contact for the issues does not change. Escalation should not become a habit.

Of the three, I believe that wrong measurement/incentives is the most serious. Organization structures by business units, functions, regions, etc. and their corresponding incentive systems worsen the situation. Most employees in any organization do not think they are responsible for customers or customer "service". In a telecom company, network, operations and finance staff would constitute over two-thirds of the organization; how many of them are measured directly on customer related parameters? I am sure similar situations exist in financial services, travel, retail, etc. Are there examples of companies where customer-related metrics drive business performance and incentives?  

My iPad Review

When the iPad was announced earlier this year, I had written about the iPad being a device that will appeal to new segments of the "computer" market: the GAAKS. Now that the iPad is here, and with me for almost two weeks (though I could not use it much during the first week due to work and travel), I am sharing my first impressions of the iPad. Whether it will meet the expectations of Apple, its fanboys and the gaaks, is still unclear, although sales of half a million in the first fortnight appear impressive.

Here it goes:

I have not gone into the tech details nor waxed eloquent about the entertainment / gaming features of the iPad... Do you have specific questions about the iPad - use the comments below to ask them, and I will try and share whatever I can.

 

Update: The review document is not readable in the iPad because scribd uses Flash! :-( I will soon post a separate version that will be iPhone/iPad friendly.

Update2: A non-Flash version of the review is now here.

 

iPad - the device for the gaaks.

Most of us have become experts at seeing what isn't, so we miss out simple 'what is' facts. The other problem that we face is that of wanting everything, everytime, everywhere. 

Apple's latest creation, the iPad, has underwhelmed the tech media and analysts; they are unable to see why somebody would use a large smartphone or an inferior laptop. Many others are aghast at the iPad's lack of Flash support or multi-tasking. That there aren't two cameras to support photography and video-chatting has let down a few more. Of course, some can't get over the "i" jokes and worse still, the "pad" jokes.

I beg to differ. I see here (and in a few other such devices) an opportunity to expand the market for digital services. Take it beyond the tech workers and fans of gadget blogs, take it beyond the home and office use, take it beyond the developed markets. I firmly believe that iPad has the opportunity to define its market, not as a large smartphone or as a cheaper/smaller laptop but as the primary digital device for the GAAKS, as against the geeks! (More about the gaaks, later.)

Broadband penetration remains relatively low in several emerging markets, not only because of supply constraints but also because prospective customers do not see value in the service. The primary interface device is a computer that is as "complex" as it is expensive. Most kids and senior citizens (all 45+ would qualify!) that have not received "formal" IT education would not venture to use a computer without assistance. Even when they do use a computer, it is rarely for its computing or processing power but really for the purpose of communication, media consumption and sharing. Finally, the keyboard is the most counter-intuitive input/control device that puts-off even highly educated people, leave alone those that aren't. 

It is obvious that the next Broadband access device has to be developed using the same principles that have made mobile phones and media players accessible to several billion people worldwide. Simple and intuitive user interface that helps in communication/sharing and digital media management. A device that two-year old kids can manage and so can 60+ old grannies. Something that the neighborhood aunty will find as appealing as students focusing on their courseware. Something that the average-J can use to be more productive at work. Move over geeks, we need to serve the grannies, aunties, average-j, kids and students. The GAAKS.

Using a few personal, albeit anecdotal, experiences, let me outline needs of the gaaks in the context of a digital device: 

Grannies: Simple visual control-interface, limited need for typing. Big, bright screen; large icons. Mostly photos, videos and music. Reading books. The occasional video chat. Home use.

Aunties: Cool looks. Fit in handbag. Idiot-proof controls (Oh, did I delete something!?). Music, videos and photos. Calendar. Facebook. Mail reader and forwarder. Home + nomadic use.

Average-J at work: Portable. Simple but secure. VPN/Exchange connectivity. Mail, Calendar & Contacts. Notes. Presentations (on-screen or projector). Document editor. Corporate apps. Occasional media (IT rules permitting). Mobile use.

Kids: Rugged (4-feet drop proof). Delete-proof. Intuitive physical & visual interface. Music, videos, games. Education apps. Occasional books/comics. Anywhere the parents want a silent kid. 

Students: Cool looks. Portable (fit in a ruck-sack with other assorted stuff). Social networking. Music, videos, photos & games. Camera or camera-phone interface. Search. Reading books & making/sharing notes. Everywhere use.

(I have described generic / average usage scenarios. There are bound to be exceptions in each of these categories. Have also not included stuff that can be done using pretty much any mobile phone: yakking, texting, FM radio, etc.)

Which device is more likely to serve these large user segments: a laptop-variant or an iPod Touch variant? Remember, most of these people already have access to a mobile phone, so they have basic voice and narrowband connectivity. A bigger, brighter and more capable iPod Touch or an iPhone appears to be more relevant to these users than a laptop or a netbook. The iPad may not yet address all these requirements but from a hardware perspective, it appears to have all features (except a video camera for chat: surprising but not a deal-breaker). The interface and software are almost ideal for the gaaks; a few rough edges should get resolved through software upgrades.

Us geeks will still buy the iPad because, well, we just have to have it. It will add to the bag-load of devices and accessories that we carry with us everywhere. The significance of the recent Apple announcement is that a whole new, untapped market is about to open up. What they call "blue-ocean" stuff in management consulting parlance. More power to the gaaks.

How many dissatisfied customers can you afford to have?

"You cannot satisfy every customer" the marketing manager said.

In a spirited discussion about the role of Web 2.0 in marketing, the conversation turned towards the large number of negative comments posted on websites and Twitter and such like. How do we know they are even for real? There are so many people out there saying what they want about our brand; we can't take everyone seriously. It could be competitors trying to malign us. Why couldn't the customer provide his mobile number in the complaint? Valid questions.

But are we trying to use these as excuses to delude ourselves that our customers are all happy and have no reason to vent their anger online? Are we using the (relatively) low penetration of the Internet (now) to treat it as a trivial medium? Most customers, when they have a problem, approach the traditional customer service channels. And most of them are willing to accept that a product or service could have a deficiency - nobody's perfect. What they do want are clear responses about what we propose to do about the situation and action to back that promise. It's only when they get automated responses ("thank you; noted; will get back; do not reply to this mail") or a stalling customer service agent ("our servers are slow/down; here's a trouble ticket #; pray") that some customers pour their sorrows in mails to the President of India or messages at mouthshut.com and Twitter.

In some cases, messages on Twitter / FB could cover issues / concerns that traditional customer service channels do not typically address ("xyz airline was late again #fail").

Marketers would do well to heed both types of messages. The first reflect angst or frustration that could lead to the customer not just complaning her case but becoming a brand un-ambassador (e.g. United Breaks Guitars!). The latter type are still not angry but gradually getting there. Registering the feedback and even involving the customer in designing a solution should be the proactive approach to managing the situation.

Every dissatisfied customer we leave out there is potentially raising an army of other similar people and can cause irrepable harm to our business. The Web provides them the platforms. Do we want to provide them a reason?