Avoiding automation annihilation
November 11, 2011 - Openet
We need more automation!
As we know, many problems in BSSOSS would be avoided if there was fully automated, end-to-end business processes and their supporting systems. There are still too many manual steps, as well as requirements for manual intervention to “fix” things. This approach can work for a while if you’re prepared to throw bodies at it, but as things scale it becomes impossible to sustain processes that heavily depend upon people to function – costs rise and the process slows. In addition, human error adds to inefficiency. Thus there is nothing wrong with automation – in fact, higher levels of automation are desirable – but I believe it’s important that we recognise that not all automation results in good outcomes and we should strive not just to automate, but to automate well.
Not all automation is good
As much as I appreciate the need for more automation in BSSOSS I want to sound a word of caution. There is such a thing as “bad” automation, over-automation and so on. If automation means that the system sticks to a particular process too rigidly and cannot accommodate differences or exceptions, then there can be unexpected and unfortunate consequences to that – in fact you can become less efficient as a business. Thus one of the great strengths of automation – the ability to ensure a standard process and business rules are followed – can also be its achilles heel.
One of the most obvious examples of unpopular automation lies in the CRM layer and in the call centre. A few years ago many CSPs along with other big companies in Europe, North America and elsewhere decided that it was costing them too much money to provide CSR support to their customers. Firstly they closed bricks-and-mortar premises. Next some companies offshored their customer support, with mixed results, in order to reduce the cost. Other CSPs decided that automation was the way to go rather than outsourcing. So they set about finding ever-more cunning ways to prevent their customers from talking to them. Now customers would have to use IVR systems, self-service web portals and so on. Since customer enquiries were often complex, this led to labyrinthine IVR menus that made customers give up the will to live, let alone interact with the company.
In a nutshell, bad automation is anything that frustrates customers, makes their lives more difficult or results in lost opportunities (such as driving up churn, or failing to capture a sale). In contrast, “good” automation is less visible, but creates a better customer experience as well as greater efficiency. An example of good automation is the ability to support the CSR with the information they need to resolve a customer complaint, or a fully automated business process that results in lower order-to-fulfil fallout or fewer billing errors.
Why bad automation leads to lost opportunities and frustrated customers
Much automation is being driven solely by the service provider’s internal requirements, which is why it can lead to negative outcomes for customers. These negative outcomes can range from frustration to direct revenue loss and churn.
For example, a friend told me last week that he dropped out of an online order for something he really wanted because he is one of the few people on earth without a mobile phone. Before you could buy anything, the website insisted upon you filling in a mobile phone number. No mobile number, no order. Now that is madness – a commercial disaster! This is an example of failing to allow reasonable variance (options) in the ordering or customer support process.
Other friends and relatives – particularly the elderly – are sorely confused by IVR because they just don’t understand the paradigm or become frustrated and upset when none of the options fit what they really want to say. Often this is because these options are described in industry-speak or CRM-speak which requires the customer to translate their problem into an industry bucket. Dissatisfaction with IVR can stimulate churn, because customers leave to find a company that will talk to them. In fact, I facilitated this very process last week for an older relative who had spent two weeks trying to talk to a company which sent him round and round in circles through its IVR system before dropping his call. It was no good explaining that his problems were simply due to a poorly designed IVR system, this man saw the dropped calls as rudeness.
On the other hand I love a good website. I’m much happier doing things for myself than speaking to someone. My service provider though – in my view perversely - insists on trying to talk to me and I hate it! I’d be far more likely to respond to an SMS they sent me, than to a voice call. But that’s just me… And that’s the point! All customers are different and have different preferences, needs and circumstances. What CSPs need to deliver is both sets of benefits – an enjoyable experience with the personal touch combined with the cost and efficiency benefits of automation.
In short, good automation meets the needs of your customers as well as the needs of the CSP. Monica Zlotogorski from Openet makes just this point: “Efficiency is always a good thing. However, we must ensure that automation supports personalization and is not a one-size-fits-all approach. In other words, there’s a risk that you can automate a process and make it dumb. Good automation delivers the benefits of efficiency, but also incorporates the ability to accommodate the individual needs and voice of the customer. This is achieved using a rules-based approach, which supports options. Let me explain how this can work. Openet recently launched the Subscriber Engagement Engine (SEE). This enables smarter automation by managing high volumes of data in a real-time, secure, scalable and reliable manner. It gives subscribers real-time visibility into their usage, as well as the ability to control services, and to purchase new services. Consequently, SEE provides a direct channel to interact with each subscriber and can process requests in a way that is accurate in value and time, while remaining completely personalized to the individual user. The operator can scale this to meet the needs of all their subscribers, which can significantly reduce the resources and costs needed to set up and administer individually customized controls without compromising on the experience delivered.”
Automating customer care has led to a loss of business value
We need to automate processes in such a way that they can accommodate choice and exceptions, but there’s also a wider lesson here that naturally falls out of this initial drive to automate. That is, that when CSPs decided to automate customer care via IVR and self-service websites they did this because dealing with calls was costing them too much. However, they failed to evaluate the cost properly. They calculated only the direct monetary cost of supporting customers, but they didn’t factor in things like opportunity costs and customer satisfaction metrics. In other words, they didn’t balance the cost of supporting a customer via IVR with the benefit of deriving valuable information from them, delivering a loyalty-enhancing touchpoint and so on. In fact, by driving through automation in customer care – irrespective of customer preferences – they have impoverished themselves by limiting their knowledge of their customers’ feelings. It has meant an over-emphasis on the negative (ie complaints) and a failure to capture and exploit the positive (eg suggestions, positive feelings, recommendations, upsell and cross-sell opportunities etc). This has led to a degradation in customer care where talking to customers is seen purely as a cost that affects profit, rather than a vital part of an ongoing relationship.
And don’t get me started on payment methods – why is cash a dirty word for UK CSPs? Are they really so powerful they can dictate how we pay (direct debit) and we have so little choice that we comply? They are focused on an internal motive – reducing the cost to them of processing payment – irrespective of the needs of customers. I know a lot of people who are rebelling against direct debits and credit cards and choosing service provider solely on the basis of payment method. This is a key selling point for the Post Office in the UK (who resell broadband, home phone and mobile) and other MVNOs – that you can pay by cash if you prefer. It’s unbelievable that this is a point of differentiation. This contrasts with the position of most retailers who are happy to get money out of their customers by whatever method they can.
What’s happening now, however, is that we’re going full circle. CSPs have decided that they need to reach out to their customers after a decade of ignoring them. Price no longer differentiates, so the new frontiers are customer service and product differentiation. Instead of talking to a CSR in a shop or by phone, CSPs are getting excited by the capabilities of a new channel and new technical solutions – social media and sentiment analysis, for example. Social media may be trendy but the much-touted benefits of lots of very clever technology associated with social media care still fall short of the experience provided by a well-trained human. We shouldn’t underestimate the business value of a good CSR.
CSPs should select the mix of channels based on customer choice not just cost
Social media, websites, mobile, CSR – all of these undoubtedly have their place in the mix – but the choice of channel should not be entirely down to the CSP to decide (with the decision based solely on cost). CSPs need to be willing to interact with their customers wherever their customers are. And the fact is that some customers still prefer to talk to people and to pay in cash. Rather than making these people feel like aliens whose money is good for nothing, shouldn’t CSPs with their flattening revenues do far more to accommodate them? Shouldn’t we be reducing the barriers to customers doing business with us rather than making it less easy or less convenient?
Cerillion’s Dominic Smith makes a very important point in this respect. He says: “Customer service is ultimately about choice. As a consumer you want to be able to communicate with your service provider in the most convenient way for you at that point in time. What you are doing and where you are will determine which customer service channel you will use, rather than being forced down a particular route that is most convenient for your service provider. However the options and service available must be the same through each channel, it’s just that the interaction will be tailored to each touchpoint.”
In other words, automation cannot be delivered just from the CSP perspective to deliver internal efficiencies. CSPs must take the time to examine automated processes from the point of view of their customers. And they must ask more commercial and customer-centric questions, as well as operational and cost-saving questions, when they automate a process. Examples being: Is this also adding value to the business and the customer experience and if so how? What opportunity costs are there (if any)? How do we accommodate choice and personalisation? How can I optimise this touchpoint and derive the most value from it for customers and for the business?
And I cannot agree more with Dominic when he says: “We really do have to take onboard the point that customer care is an opportunity and not just a cost.”
NSN’s new self-service app is a great example of customer-centric automation
A very positive step in this respect was NSN’s recent announcement of a self-service app for social media (initially Facebook). Behind the scenes the technology is much the same as any self-service approach; but from the customer’s point of view the app makes it easier to interact with a company (eg a CSP) through a familiar interface. What I like about this idea is that it takes a customer-centric approach to self-service. It enables us to envisage a world where no longer do I have to invest time and effort in learning the peculiarities of a self-service system for each and every company I deal with. Potentially, I could do it all through one familiar interface. It also combines positive aspects of social media to the benefit of both CSP and customer. Being able to share recommendations and information with friends (and having complete control over what I share) adds a fun and useful element to the self-service experience. The approach also adds much needed privacy control to social media, because the customer decides what to share and the data remains in the secure CSP domain until and unless the customer decides to share it.
What this app also shows is that the difference between a great customer experience and a poor one, and between good automation and bad automation can be relatively slim technically; but that slim difference is critically important. I believe that the recipe for success is to always have the customer in mind throughout the design of business processes or systems and to ask not just “what’s in it for me?” but also “what’s in it for them?” This requires everyone involved to put their customer hat on and think whether the system or process is easy and enjoyable for them to navigate as a customer, and whether it would be for their children, for their parents, for their neighbours and so on. We’re all customers as well as industry participants and we need to leverage that perspective far more.