How Strategic is your Service?
Businesses today are on a never-ending quest for growth, but traditionally the service department hasn’t been viewed as an avenue for this growth. This, however, is in the midst of a change as organizations start to look at a more strategic service model to improve satisfaction, as well as grow revenue and profits.
According to the recent Aberdeen Group report, Strategic Service Management, companies that apply strategic service models are more likely to increase revenue, profits and customer retention. These companies, referred to as “best-in-class”, have implemented a strategic service model and are reaping the benefits.
Plan, Forecast and Align
To move your company to a strategic service model, one of the first steps you’ll need to take is to plan, forecast and align your service resources and demand. This will help you estimate your service demand and align your resources to better serve your customers. For example, many companies use scheduling software to forecast their service demand and pre-position service technicians near this demand. This saves travel time and increases technician productivity, while increasing customer satisfaction.
Appoint a Senior Service Executive
According to Aberdeen, one of the big issues that separate their best-in-class companies from the rest is the fact they have senior service executives. These senior service executives should have access to the executive-level decision process and accountability for service goals.
Base SLAs and Contracts on Customer Needs
Offering multi-tiered service level agreements (SLAs) and contracts, rather than the typical “one size fits all”, can help you become a strategic service organization. Multi-tiered SLAs and contracts give customers a choice and will ultimately improve their satisfaction. In addition, you’ll have more opportunities for revenue growth based on contracts with different values and costs.
Monitor Assets in Real-Time
Unplanned demand for service can cause your company to overuse its resources, which eventually leads to lower revenue and dissatisfied customers. You can avoid this by remotely monitoring your assets to preemptively take action when an issue occurs. Many of Aberdeen’s best-in-class companies accomplish this through emerging M2M-enabled solutions, resulting in a 38 percent improvement in customer retention and a 20 percent improvement in customer revenue.
Tie Employee Compensation to Performance
Many times an organization will implement all of the requirements to develop a strategic service organization, only to find that their employees don’t accept or promote the change. For this reason, Aberdeen recommends driving service employees’ behavior by linking their performance to their compensation. Link their compensation to established revenue, profitability and customer retention metrics and you should see a rapid change in behavior.
Once you’ve implemented these steps, you’ll be on your way to running a more strategic, and profitable, service organization. To learn more, download the Aberdeen Group’s report Strategic Service Management (registration required).