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Understanding Customer Needs
Transcript of Understanding Customer Needs
Services can adapt to different cohorts of customers
Poor customer experience inflicts huge costs on organisations
7 out of 10 people have ended a relationship due to poor customer experience
Each lost relationship costs around £400 in service industries
This has a negative impact on the reputation of a business
There is a financial loss to society as a whole
Poor customer experience costs the economy £15.3 billion
There are also consequential losses generated in terms of frustration, stress, ill-will etc.
Unnecessary resources are expended
As an example, employee motivation often falls due to poor interaction with customers
Organisations focus on often on high end features and functions rather than getting the basics right
Many organisations do not get the basics right in understanding customer experience or expectation
The first step should be to understand and measure the direct business impact of customer service, and identify the gaps between the customer experience and expectations.
Genesys – Global Survey of Customer Experience, 2009
Today, more so than ever before, customers listen with their eyes to see what a company does rather than with their ears to hear what the company says. Customers feel first, think second.
The State of Customer Experience Capabilities and Competencies SAS, SAS Institute Inc. and Peppers & Rogers Group, USA, 2009
Amazingly, only 20 percent of companies today even try to know the state of their customer experience success by measuring it holistically across all channels
The Customer Experience Quality Framework, Forrester Research, 2007
Better customer experience can reduce costs both to an organisation and to society
Understanding Customer Needs
to drive sustainable service excellence
Measures of customer satisfaction are often inadequate at understanding true needs or expectations
Returns are often low and statistical significance is questionable
People who fill in questionnaires are likely to be biased from the overall cohorts of customers
On a conscious level, customers sometimes find it difficult to articulate their true priorities
The feedback mechanism for change and improvement of services is slow, from understanding customer needs, often lacking adequate details
Organisations often find themselves creating unintended consequences in improving just one element of customer service
When making suggestions, customers assume that the organization has infinite resources to meet customer expectations
They are often unable to articulate exactly what is driving their expectations
The questions have set gradations wholly based on customer expectation (e.g. very good to poor), which in itself offers little insight
Service elements that are wasteful in terms of customer experience are clearly identified
Customer needs are classified in different dimensions (basic & attractive)
Customer experience needs to be based around four attributes.
•Features where satisfaction and dissatisfaction are in line with availability and performance
•The better the performance, the more satisfied the service user will be
• Elements of the service that are taken for granted as essential
• Huge dissatisfaction if missing or if performance is poor
• Only limited satisfaction if available or performed well
Where nature of features incrementally improves experience
Features that the service user perceives as unusually high in value
Can achieve disproportionately high satisfaction
• Elements which the service user does not consider important
• Little value placed on these service features
An example of attributes of the customer experience for a business-hotel
• Spa/ swimming pool
• À la carte restaurant
• Power shower
• Range of TV/ sports channels
Quality room service
Good view from window.
• Desk & access to power
• Quick check-out
• Helpful staff
• Snacks available in the
room for purchase
• External dial - telephone
Understanding the attributes helps to
answer the following questions:
• If the aim is to improve the service, where should resources be focused?
What investment will give the best returns in terms of perceived quality of service and satisfaction?
Where do we need to manage customer expectation?
Which elements of services can we downgrade?
What elements can we adapt based on the
individual or a smaller cohort of customers?
Where do we focus staff training and behaviours?
We have an approach over 3 phases to get service experience right
Improve, reduce or re-visit expectations
Personalise to serve smaller cohorts of customer types
Review current data
Identify elements for specific service with customers
Measure against customer expectation
Reconfigure service experience
Adapt service experience
Manage customer expectation
Track Benefits (Tangible/Intangible) – Allocate Resources
kinetik solutions provides business transformation, process excellence and change management in operational settings
Phone: + 44 (0) 20 3397 0686
An excellent approach in developing ideas and principles which was frequently used to talk both operational teams and senior managers through a number of concepts and design iterations. Some of these were so successful that they have now been adopted across the project.
Head of Operations, Census Division, Office of National Statistics
Their approach achieved an intensive, evidence-based focus on a key policy and operational priority,integrating multi-disciplinary and multi organisational perspectives. Their preparation and professionalism…added real value.
Head of Informatics, NHS Acute Trust