How to Create a Customer Service Plan

These days customers reward those companies that satisfy their needs and reject those that are not responsive to their needs and expectations. This article will take you through the process of setting up a customer service plan in your company starting with an assessment of your current customer service approach.

Then, we deal with determining what your customers' requirements are, creating a customer service vision with customer-friendly policies, methods for dealing effectively with your customers, and advice for educating the rest of your organization to carry through your customer service focus.

Benefits of an Effective Customer Service Initiative

You, your employees, and your organization can benefit from customer service in the following ways:

In Daily Business

There are a few things in which a good customer service plan can benefit you directly.

Less stress. If you are dealing with customers directly, especially unhappy ones, there will be a certain amount of stress with each episode. You can reduce it if you have a systematic way for dealing with your customers.

Higher efficiency. When you focus your efforts on areas that directly affect customer satisfaction, you can utilize your resources more efficiently. An effective customer service program provides a plan for working on those areas most important to your customers and reduces the deviation which may distract you and your organization from focusing on these areas.

Increased morale and satisfaction. When you are working on those areas that mean the most to your customers and to the success of your organization, then you will share a common vision and meaning with your entire organization.

In the Long Run

Good customer service doesn't just improve the every-day workings of your business. The customer experience has never been this important.

Cost-effectiveness. According to surveys, it costs five times more to gain a new customer. The same survey also proves this fact that with just a 5% increase in customer retention, a firm can raise its profitability by 25% and in some cases as much as 85%. Similar studies also show the longer a company keeps a customer, the more money it will make. This happens because consumers spend slowly at first, but with succeeding years of good experiences, they will spend increasingly more.

Competitive advantage. Fierce competition demands more and more innovations to differentiate organizations from one another. With technology available to virtually all organizations today, whether online or off-line, traditional feature and cost-benefit advantages no longer offer for a sustainable competitive advantage.

Survival. Effective customer service becomes the cause of your staying in business. With growing competition, there are plenty of suppliers eager for business and the opportunity to satisfy customers. If you are not one of them, you may not stay in business for a long.

More and more companies are turning to quality of service to make themselves prominent from their competitors. They are talking to their customers to determine what is most important to them and how they can further add value to them.

Steps to Create a Customer Service Plan

Each organization's customer service plan must be customized to suit its own needs, but, more importantly, it must satisfy the needs of its customers. There is no hard and fast rule for an effective customer service programme; each one will have its own distinct differences. However, there are some common steps that you need to consider when setting up your programme. They are:

1. Assess Your Customer Service Quotient

In order to establish an effective plan to focus on customer service, you need to know where you start from. Following is a self-assessment that, when completed honestly, will begin to point out opportunities for improving your customer service efforts.

For each statement, rate how well you or your organization satisfies the condition using the following points scale:

• Never -- 1 point
• Hardly ever -- 2 points
• Sometimes -- 3 points
• Usually -- 4 points
• Always -- 5 points

Note: If you are a one-person office, answer from your own perspective. If you are an organization with several employees, answer the questionnaire from your organizational perspective.

A. Customer-Centric Culture

• We're committed to do whatever it takes to create satisfied customers.
• We try to do things right from the very beginning.
• The owner provides the leadership philosophically and by example that customer service is important.
• Serving our customers' needs is more important than meeting our internal needs.

Total Score divided by 20 = ___%

B. Customer Alignment

• When we sell, we aim for a partnership approach.
• In our collateral materials, we don't promise what we cannot deliver.
• We know the features and benefits that are most important to our customers.
• We design new products/services based on info provided by our customers.

Total Score divided by 20 = ___%

C. Error Reduction

• We review customer complaints.
• We constantly ask our customers for feedback.
• Periodically, we look for ways to eliminate errors based on customer input.

Total Score divided by 15 = ___%

D. Using Customer Information

• We've determined what our customers expect from us.
• We frequently interact with our customers.
• The entire organization knows what is important to our customers.

Total Score divided by 15 = ___%

E. Customer Outreach

• It's easy for our customers to contact and deal with us.
• We aim to resolve all customer complaints.
• We encourage "wowing the customer."

Total Score divided by 15 = ___%

F. Qualified and Empowered Staff

Answer this only if you have a staff.

• We respect our employees.
• All employees have a good understanding of our product/service.
• We give all of our employees the right tools and skills to perform their jobs well.
• All employees are encouraged to resolve customer issues.
• All employees feel that customer satisfaction is a responsibility of their job.

Total Score divided by 25 = ___%

G. Improving Products, Services, and Processes

• We constantly work to improve our products, services, and processes.
• We network with other groups to learn from their strengths and weaknesses.
• When problems are identified, we quickly try to resolve them.

Total Score divided by 15 = ___%

Source: Adapted from The Forum Corporation's Self-Test for a Customer-Driven Company.

Now evaluate how well your organization focuses on customer satisfaction. Note the areas where you score high and those where you are low. The low scores will suggest opportunities for improvement. List three areas you need to improve.

2. Understand Your Customer's Requirements

Without understanding what your customers actually want and require first, an initiative to improve customer service is unlikely to be successful.

Often organizations claim to know their customers' requirements, yet they've never taken the time to do a real thorough analysis. Sure, they probably know their customers' general requirements, but do they know what is really important to their customers? How do they measure up relative to the important factors and how they compare to the competition in the areas most important to the customer?

In most cases they don't, and won't, unless they collect this information in a formal, systematic manner. There are two basic sources of that information: Internal data and customer data.

Internal Data Sources

Begin your search for customer data in-house. Most likely you'll uncover some things that you can fix immediately, which will make your customers happy and get you started on the right track.

Key Operational Data

Without looking too far, you'll be able to uncover potential areas of customer dissatisfaction by reviewing your key operational data. Check on the status of backlogs or stock outs. Chances are if these are significant you may have some customers that are not happy with your delivery cycle time.

Review your "Returns and Allowances." If they are high, then your customers may be unhappy with the product they purchase--either the quality is inferior or they felt the product was misrepresented and not what they expected at all.

Internal Reject or Yield Rates

If your rejects are high or your yields low, you can bet that some bad product is leaking out to your customer. Even if you inspect the product before shipping it to the customer, tests have shown that inspection isn't 100% reliable--some bad product will sneak out.

Service Metrics

Consider  your local telephone company. Customers are typically concerned with the turnaround time for performance of service. The telephone company could review its internal records for the average turnaround time. If it's excessive they probably have some unhappy customers. Another measurement to look for us the number of times they must re-do a service. Customers expect you "to do it right the first time." If you don't they become unhappy.

Your Employees

Don't forget your own employees as a valuable source of information on customer requirements. They interact with customers constantly and probably know a great deal about their likes and dislikes.

If you are a one-person organization, then you are the one dealing with customers. You know what's going well, what needs fine-tuning, and what needs a major overhaul.

Using Internal Data

Review your internal data to pinpoint potential problem areas for customers. Also, gather your employees together and get their inputs on your customers' satisfaction level. Assemble a list of strengths and weaknesses, but don't get bogged down in the details. You're looking for a few areas where you can begin making improvements.

Customer Data

You should start with a review of customer complaints and inquiries. If you don't have a systematic way of collecting these, you should develop one. Both are good indicators of opportunity areas. However, don't limit yourself to just complaints and inquiries. Studies show that only 2-4% of dissatisfied customers ever complain. If you're only looking at complaints, you're missing the other 96-98% who have problems with you.

Run Surveys and Focus Groups

Surveys and focus groups are two of the most popular methods for gathering information on customer needs. Surveys are written questions given to individual customers; focus groups are oral questions administered to groups of customers. Both must have clear and specific goals up front in order to be successful.

A broad questionnaire or focus group session provides you with a lot of information, but it's usually too general to be of any value. Objectives must be clear and questions specific if they are to provide results that can be acted upon. Although focus groups and surveys are similar in what they want to accomplish, one may be more suitable than the other, depending on the application.

Surveys are relatively simple and economical to administer and can reach large amounts of customers, but the information can sometimes be limited since it is a one-way exchange of information.

Focus groups, on the other hand, take more time and effort and are often more expensive to administer. They may not be as far-reaching as surveys, but their interactive nature produces clearer feedback. The best results are found when combinations of both techniques are used to identify customer requirements and expectations.

What Data is Relevant?

More is not necessarily better when it comes to customer data--getting the right kind of data is critical. After all, this is what you ultimately base your customer service plan on. Following are the key characteristics of good customer service data:

1. Timely and periodical