The FT Word
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Welcome to the May 2011 edition of the FT Word. Please forward it to your colleagues. (They can get their own subscription here.)
Topics for this month:
The Number of the Month: 4%
As reported in this month’s issue of CRM Magazine, Orange UK, a telecommunications company, is retaining an additional 4% of its most valuable customers each month, thereby adding $40 million a year in profit, thanks to using a predictive analytic tool by Pegasystems (an FT Works customer, but I had nothing to do with this feat!)
I found the story interesting in two ways:
- One is the power of analytics. Too often I see analytics used strictly after the fact and in an almost punitive way. You did not close your quota of cases! You did not create your two knowledge base documents! You missed the target CSAT score! It seems to me that using metrics in such a way leads, inexorably, to creative gaming of the metrics. Why not, instead, use metrics to predict and prevent? For instance, backlog is rising above historical levels. We know this means that customer satisfaction is at risk so let’s take action.
The other is the sad story behind the happy $40 million gain. The way Orange uses predictive analytics is to, get this, instantly create a counter-offer for customers who call to cancel their plans. So basically they are waiting for customers to tell them goodbye to take action. Better late than never, I suppose, but how about predicting which customers are likely to defect and doing something about it? That would be great service. And it would not be too hard to predict that customers who just had a bad service experience, or a series of them, need some TLC…
Limiting Technical Contacts
Many thanks to Ravi Desai for suggesting this topic!
It seems logical that placing a limit on the number of individuals who can contact Tech Support would help reduce case volume. But is that indeed the case? And will customers accept and work within the limitations? Let’s find out.
The Rationale for Limiting the Number of Contacts
Your customers may be running highly-customized version of your products and they may have hundreds or thousands of end users. If all the end users can contact your organization, they may generate oodles of requests for very simple how-to tasks, and moreover requests that your staff cannot answer properly because you do not have access to the customized application. Therefore, it makes more sense for customers to staff and maintain an internal help desk that filters out the end users’ requests and only brings to you issues that have to do with the application itself. So you get a much smaller volume of issues, and issues of a nature likely to be resolved by your team.
An additional benefit of limiting the support contacts is that it allows you to define some requirements for the technical contacts. Perhaps they need to have attended training, or even be certified on your products. In any case, if one of them proves to be less than technical adept you can politely request a change.
Asking customers to designate a set number of contacts also offers some security guarantees that only properly-authorized individuals will be able to make changes to the system (although, to be sure, you could have good security without limiting the contacts). In the same vein, limiting the number of contacts helps to maintain the list of contacts since the customer will need to clear out old contacts to add new ones.
Finally, over time the technical contacts will gain expertise and will be able to filter out more and more requests.
Does it Work?
Since most vendors either limit contacts or don’t, across the board, it’s hard to make head-to-head comparisons. However it’s intuitively clear that someone who handles lots of support issues will, over time, increase his or her skill level with the product and with the support process. Note that limiting contacts, at best, only limits the volume of easy issues that get raised: the more difficult issues will always come to your organization.
There is an overhead associated with limiting the number of contacts, especially since most case-tracking systems do a mediocre job of supporting such limits so manual intervention is required. Explaining the limits to customers and enforcing the limits also takes time. And even if customers comply there’s always the situation where all the authorized contacts are away from the office and some emergency needs handling. So there is an administrative cost to limiting the number of authorized contacts.
There may be more serious and hidden costs, especially if you impose draconian limits. If only a handful of individuals can open cases, you will find that a number of people use the same name, creating confusion (and defeating the purpose). Or problems take forever to resolve because the authorized contact must liaise with multiple individuals – once again adding to the complexity of each case.
Best Practices for Limiting Contacts
Limiting authorized support contacts used to be a regular, unquestioned practice. This is changing.
In some circumstances, placing artificial limits on the number of contacts is plain silly. For instance, if you support systems placed in data centers and accessed by large number of operators around the clock, you are much better off focusing on the systems rather than the contacts. Anyone who has a question about a particular system should be allowed to open a support case.
If you offer a SaaS solution, the expectation may be that all end users are eligible for support – at least for applications with few customization options.
If you choose to limit the number of authorized contacts, use reasonable (high enough) limits. You have better things to do than argue with your customers about this king of issue.
If you choose to limit contacts make sure that your tracking system can handle it without creating a heavy manual administration burden.
If you offer tiered support packages, highlight the larger numbers of authorized support contracts available with higher levels of support. It’s an inexpensive benefit.
Consider designing packages that reward customers with few support contacts. For instance, give a discount to customers who limit their support contacts.
Vary the limits on support contacts depending on the size of the customer. Larger customers need (and deserve) more contacts.
Place no limits on self-service. While it may make sense to limit the ability to open support cases, the knowledge base and the community should be open to all.
Shift your focus from quantity to quality. Perhaps what matters the most is not the number of authorized support contacts, but their technical skills. Better request and police better-trained contacts than simply fewer of them.
For more on creating support offerings, see Selling Value.
FT Works in the News
TSIA published an article I wrote in the April edition of Inside Technology Services: Is ROI the Right Metric for Support Communities? You can read it at http://www.tsia.com/emails/Inside_Technology_Services/2011_04_07_inside_tech_services/is-roi-the-right-metric-for-support-communities.html?mtcCampaign=-1&mtcEmail=12149681
TSW – May 2-4 in Santa Clara, CA
If you’re planning to attend the TSW conference, I hope to see you there. For the first time ever, FT Works will have a booth so come by and visit! (Go to the back of the expo hall, towards the left.) And I will be giving two presentations:
One is a pre-conference workshop on the first day, Monday May 2nd, entitled A Gold Mine? Calculating the ROI of Community Projects. In this interactive session we will build a meaningful ROI for your community. Bring your computer and I will provide the spreadsheet template. More information here and also in an interview I did with John Ragsdale, here. You can show up at 8am and enroll on the spot.
The other is a workout session I will facilitate with Rob Shapiro of Oracle entitled Start the (Metrics) Revolution, discussing metrics and best practices for support communities in an open discussion format. Please join us on Tuesday May 3rd at 2pm and add your voice to the debate. More information here.
Social CRM Webinar – May 12th
CustomerThink is hosting a virtual summit on Thursday May 12th about Social CRM Best Practices and I am a featured speaker. I will speak about Integrating Social Media into Your Customer Service Strategy and specifically about ROI for communities and there will be plenty of time for questions.
You can find more information here: http://bit.ly/dTIc8W
Third Tuesday Forum – May 17th
Are you based in the San Francisco area (or will you be there on Tuesday May 17th)? That morning, David Kay and I will be hosting The Third Tuesday Forum, a roundtable for support executives to discuss the topics we embrace and wrestle with every day. The presenter will be Robert Binkley of Xilinx, who will speak about a topic very near to my heart, ROI, and how to sustain ROI analyses beyond the justification step. You can register here. The full calendar is here. You can also sign up for the mailing list. You will be the first to know about new events. You can also join the Third Tuesday Forum groups on LinkedIn and Facebook.
Curious about something? Send me your suggestions for topics and your name will appear in future newsletters. I’m thinking of doing a compilation of “tips and tricks about support metrics” in the coming months so if you have favorites, horror stories, or questions about metrics, please don’t be shy.
650 559 9826
About FT Works
FT Works helps technology companies create and improve their support operations. Areas of expertise include designing support offerings, creating hiring plans to recruit the right people quickly, training support staff to deliver effective support, defining and implementing support processes, selecting support tools, designing effective metrics, and support center audits. See more details at www.ftworks.com.