New Study Reveals Companies' Need to Rethink Customer Service Approach

Could an idea as old and familiar as "good customer service" really be the next "killer app" for business? You bet, according to a January research study from Katzenbach Partners LLC, a New York-based management consulting firm.

According to the report, because the market for many goods and services has become increasingly commoditized, over-crowded and price conscious, customer service has become critically important as a potential source of strategic differentiation and profits. The challenge for most companies, however, is that they have an incomplete understanding of what constitutes good customer service and, as a consequence, their interactions with customers often leave a lot to be desired.

According to the report, some widely accepted customer service "best practices" actually undermine the customer experience:

• Believing that the customer always comes first Ã.‚¬" Instead, managers should focus on putting their frontline employees first, so that they, in turn, have the resources and freedom they need to care for customers.
• Basing call-center service on scripted responses Ã.‚¬" Scripts, according to the report, do more harm than good because they reduce the frontline's flexibility in responding to customer problems and requests.
• Thinking about customer service as strictly a cost center Ã.‚¬" Instead, companies should look at customer service as a potential wellspring of innovative thinking and profits.
• Relegating customer service to organizational silos Ã.‚¬"v Companies should instead place the responsibility for customer service on the company as a whole, involving not only the frontline, but managers and senior executives.

The study is based on interviews with customer service executives from companies across a range of industries as well as a telephone survey of more than 1,000 American consumers.