We have to get back to the top of our game in driving the service agenda

By Jo Causon, CEO, The Institute of Customer Service

“If you can keep your head when all about you are losing theirs”. 

We’re already nearly a month into 2019, but it feels like a New Year has not brought much that’s new “only an intensification of a number of challenges! Political turmoil around Brexit is greater than ever and there is a feeling that we are hurtling towards a very uncertain future

In such times, it is easy for businesses to lose their way. But in fact, it just becomes more important to stick to your core purpose and customer priorities.

This is why it’s particularly concerning that our latest UK Customer Satisfaction Index (UKCSI) shows a decline in customer satisfaction scores for the third period in a row. The falls have only been small but they have become a trend. Customer satisfaction is at its lowest level since July 2016.

What’s more, the number of customers who experienced a problem with an organisation has increased and is at its highest ever level. The proportion of customer experiences that were “right first time” has also fallen. The silver lining is that satisfaction with complaint handling has improved “but of course this is only a good sign if the feedback is genuinely fed into any service improvements, rather than a short term fix.

All of this matters because, as I have written in this blog before, there is a powerful correlation between customer satisfaction and profitability and productivity. In a highly competitive market across sectors, competing on price is a nil sum game. To truly differentiate and build sustainable business performance, organisations have to pursue a customer service agenda. This also means that analysts and investors need to stop seeing service as a low level activity and start challenging boards on the service levels they consistently achieve over the longer term.

Declining service levels in which customers have to make more effort themselves only end up costing businesses money. There is a huge productivity cost when the service agenda slips “which we have estimated at £122m annually in our research on productivity for UK GDP as a whole.

The latest UKCSI shows that only one sector of the 13 we track has recorded an improvement in customer satisfaction – Insurance. Two have fallen: Transport (now recording its lowest ever score) and Services. The rest are essentially static. Surely, we can’t be content with mediocrity – organisations have to be driving a culture and mindset of continuous improvement, and challenging themselves to really design the experience through the eyes of the customer.

This time, we have also expanded the UKCSI to include new measures that give a richer understanding of customer perceptions and priorities. We are now tracking customer sentiment against the key dimensions of customer experience, complaints, and the three new dimensions of: customer ethos (the extent to which customers believe an organisation cares about them and builds the experience around their needs); emotional connection (the extent to which an organisation engenders feelings of trust and reassurance); and ethics (including reputation, transparency and the extent to which an organisation is deemed to “do the right thing”.

In the latest results, the organisations that came out top on the three new criteria were, respectively: John Lewis, M&S (Bank), and John Lewis. Meanwhile, First Direct rose to the top of the table overall, replacing Amazon who slipped to fifth. Interestingly though, there is now only just over one point between the top and fifth position within the UKCSI: emphasising the highly competitive landscape we are all working in.

Maintaining a presence in the top 10 is important and we can see a very clear differentiation between those that consistently focus on service for the long term and those that still see service as an initiative.

Congratulations must go to all of our top-performing businesses who are a reminder that, despite the prevailing downward trend, we still see plenty of genuine customer service excellence. I hope our new and expanded UKCSI will provide interesting food for thought to all organisations, and motivate those who may have slipped to redouble their efforts.

We need to get back to the top of our game, now more than ever – so that UK plc is seen as genuinely customer-led and as a trading partner that international businesses and markets want to do business with.