Improving customer service with staff incentives

by 26 Aug 2010

Australia’s customer service levels leave much to be desired. Tom Washington explores how employers can incentivise staff to up their game

We all probably knew it already, but now it’s official: Australia is rubbish when it comes to customer service.A report released last month found that 81 per cent of Australians feel that companies are not doing anything extra to keep their business or are taking their business for granted, while a measly two per cent reported that customer service usually exceeds their expectations.

The American Express Global Customer Service Barometer survey also showed that the majority of consumers would spend an average of eight per cent more if they received exceptional customer service.

Customer service is clearly so important, yet so many businesses fail to ensure its magnitude is known among employees. Indeed, businesses spend thousands on marketing their brand and services, in glossy brochures, television commercials, promotions, product development and sales channels. But all that goes spiralling quickly down the drain if the brand culture isn’t reflected at the point of customer contact. 

Mercedes Trautwein, joint managing director at EVT Incentive Marketing, says: “Marketing should really begin with looking at staff training and ensuring they have a motivated and informed team. If the team are not motivated nobody is going to do business with you, they will go to the company that is, and there will be a loss of revenue and negative referrals.

“Many of our clients have significantly cut back on their advertising spend because they’re team is working so well with profits climbing as a direct result of the incentive program.”

Fortunately, there are steps HR can take to remedy poor customer service. Trautwein says that HR must do two key things to incentivise good customer service: measure and reward. After that, she says, it all boils down to communication.

“High quality service means high quality training. A great starting point is to implement a Mystery Shopper Experience program and use that as the base line, find out the real experiences of customers measured against HR needs: product knowledge, courtesy, enthusiasm, promptness, cleanliness, how staff represent the brand. 

“There are myriad variables, depending on the business. Compliance is a critical factor in evaluation. This provides HR with real measurements which form the basis of training and the reward and incentive program then follows when you go back and test by a Mystery Shop using the same scenarios.”

James Wright, account director at Red Balloon, saysthe principle cause of bad customer service is employee disengagement.

“For whatever reason, and there are many causes of disengagement, the employee does not believe or have faith in the rest of their organisation to deliver the goods or service effectively so takes no responsibility or pride in the their customer interactions,” he says.

“Other contributing factors might be that the employee is simply not empowered to deliver good customer service, decision making lies in the hands of the few, they are confined to scripted responses or the company’s terms and conditions just stink!”

HR’s role is therefore pivotal to ensuring that employees are both enabled and engaged, and incentives must be tailored to suit specific customer services scenarios.

“Service cannot improve if incentives are solely around sales numbers or for example call handling times,” says Wright. “Recognition needs to be apparent and regular for customer service excellence, even if it costs more and takes longer than would be ideal, it is about the organisation learning and getting better. HR can drive improvements in the quality of customer service by being advocates of and ambassadors for qualitative recognition programs that celebrate the achievements of an enabled workforce.”

Key performance indicators (KPIs) are crucial in creating this environment. Once these are built into employees’ daily routine, there is something tangible to measure their performance against. Similarly, if there is a problem in the workplace such as bonuses being revoked or cut-backs introduced, this can have an effect. Not delivering bad service can be a way of acting out these frustrations.

A major trend over the last couple of years has been towards peer to peer nomination. This allows internal excellence to be acknowledged and celebrated, as well as opening up the conversation for people other than managers to spot good service and share it quickly with rest of the organisation.

An example of this, explains Wright, is at motoring organisation RACQ. With over 1,000 employees, it created the space for daily nominations for Excellence and Quality among other awards. These daily acknowledgements have helped improve employee satisfaction and in turn create the space for employees to deliver outstanding customer interactions. In less than 12 months RACQ has seen a rise in employee engagement of six per cent.

Elsewhere, a recent customer service survey was the key to a very successful incentive campaign for a client of EVT Incentive Marketing.

The customer service ranking became a highly recognised badge of pride in this particular auto- dealership,” explains Trautwein. “Customers ranked every aspect of the after sales experience. We then analysed the results and developed the incentive program. We can act quickly and alert our client to any areas of customer concern so they can step in and fix the problem with the customer and the employee.

In this method, the customer service ranking becomes part of the employers’ KPIs which all have different milestones and rewards during the year as a way of engaging and motivating the team.

It also formalises the customer service approach and puts the employer in control. Employees then hold their customer service ranking in very high regard, and see status in the position which is rewarded each year with incentive travel.

In the end, however employers choose to incentivise better customer service, the message is clear: do it now or be prepared to lose business.