Two illuminating studies of customer satisfaction are pointing to a general decline in customer service in America. The March 3rd issue of BusinessWeek presents its annual ranking of companies in an article titled, “The Customer Service Champs.” Using 2008 J.D. Power and Associates surveys, the magazine reported that most of the top 25 companies on their list scored lower than last year and a few benchmark companies that had been on the top of the list for a long time, moved lower in the ranking. In addition, the University of Michigan’s American Customer Satisfaction Index (ACSI) which is a measure of customer satisfaction with goods and services, fell in the fourth quarter of 2007. Taken together, these studies indicate that even with the increased attention to the importance of customer service in corporate America, actual service to customers is getting worse rather than better.

What’s the explanation? The conclusions from these two studies suggest that the culprit is the economy and the accompanying financial pressures that are addressed by job and service cuts resulting in fewer people with fewer resources trying to address growing consumer demands. I agree that this is part of the problem. However, my experience interviewing managers of call centers is that the management and training of customer service representatives is inadequate. Many call centers still reward reps for number of calls handled and time on each call rather than for solving the customer’s problem. Many managers treat reps like an expendable resource that can easily be replaced. This is an expensive and short-sighted way to think about customer service.

John Baldoni writes in HR.com that people must have passion and compassion to be effective employees and managers must cultivate these attitudes in their employees. Baldoni suggests that sometimes the only competitive advantage some companies have is passionate and compassionate workers. I think this is especially true for customer service. Any company can set up a call center in-house or in Bangalore and any company can set up an automated phone tree or online Web support. It’s the companies that hire people who have passion for the work and compassion for others and then continually support these employees in learning and relearning new knowledge and skills that will make customer service a competitive advantage over the long run.

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