How Quality Can Dictate Price in the Service Industry

In the service industry, one business basically provides the same service as another business. Take the valet business for example, they all take your vehicle and move it to a central location until you return, when the valet retrieves your vehicle and brings it back for you. This is the basic process for all valet services. So what can set one company apart from another? Simply stated, it is quality. It is the extras that they put into the service that separates one company from their competition.

Every service industry must understand what they can do for their customer that is above and beyond the basic service. This becomes even more important when you want to sell your service not simply based on the service you offer but also by the extras. These extras give you the opportunity to sell your service at a higher price. These extras to the service truly cost nothing on a day to day basis but add value to your customer. Yes, there is the potential for extra expenses in training the staff to complete these added touches to the service but generally they are limited and more than pay for themselves over time. However, these extras cannot be something that is simply talked about, they must be present everyday in the service. Not only will your current customers be looking for this higher level of service, your service can and will act as a form of advertising your service. This is truly how you dictate your price in the service industry. Offer added value to the basic service, provide those added values and let potential customers see the service in action.

In order to get to a point where you have control over pricing there are a few things you need to do. First, understand what your basic service is. This may seem like a simple thing but it is essential in determining what your extras are and what you can sell as extras. Second, what does your competition offer in terms of added value to their services? This is true in a business whether it be service, manufacturing or retail, you must know your competition. Third, really spend time determining what value added aspects you can provide in order to differentiate your company. Keep in mind that with the ever changing world of technology, this may be every changing as well.

In the global market of today and with competition being at such high levels, you have to find ways to take your service business to a level that sets it apart. As stated in the beginning, anyone can offer the basics, it is the extras that will help your business thrive and grow.

Challenges in the Customer Support Services Industry

Every entrepreneur knows the importance of the quality of customer support services. Although in the customer service industry a myth is developing that outsourcing the customer services will not give the desired result, this industry is growing incredibly in South Asia. Mostly progressive companies are recognizing the potential and turning towards outsourcing their customer services departments to call centers located at different regions. These call centers are the main contact point for their customers. Most prominently this industry is growing in Pakistan, Philippines, and India.

In the adverse global economic condition like others, call center industry is also facing lot of challenges. To keep consistent quality of services the most alarming global issue is the retention of staff. The reasons and solution to retain them is different in Asia as compared to rest of the world. There are two important factors in the retention process i.e. incentives and motivation. The priorities differ between agents, especially in South Asia. The balance between incentives and motivation is the dominant factor in the retention of agents. There is a considerably high ratio of agents give priority on positive relationships among the team, supervisors and managers over incentives. It is equally important to chalk out a customized plan for individual agents to find out what they value most. One size fits all approach does not work in this industry.

I don’t run outbound call center but to my understanding another possible reason of turnover is the stress in outbound call center environment. Because of the use of sophisticated technology, agents don’t get time to recover from the stress in between awkward call from an unhappy customer or the stress due to performance targets. The performance targets sometimes put so much pressure that agents start bragging the customers to achieve their targets. The stress build up can also lead to illness and promote non-attendance.

Another challenge in call center industry is measuring the quality of services provided by your agents. The difficulty is due to the fact that mostly instead of complaining to the call center or the company directly, customers tell their friends of their bad experiences. So how will you measure the quality of service? Mostly companies are using surveys to get the opinion of their customers. There are other resources which can be used along with surveys. Among those forums, social media platforms and product reviews sites are on top. I experienced a little improved result when contacting all the customers who put negative remarks on forums and commented on the product reviews sites. On approaching them I offered the best solution to their concern that the company could afford. In most cases it is acceptable to the customers converting them again a happy customer. It is still important to measure the level of satisfaction and the best way to accurately know is to ask your customer directly at the time of first interaction.

Few call centers measure the quality of their service and the customer satisfaction level by assessing the average call handling time, time to answer a call, and the number of contacts by a customer to resolve the issue. But at times this method will not show the correct picture. All these methods depend on the products and services such as technical support services which may require a lengthy call to properly resolve the issue. Same could happen with customized products where during the first call some verification is required and it may only be possible to resolve the issue on second call. Also satisfying a customer only during first interaction is not enough. To earn a considerable satisfaction level customers need iterative positive experience from the contact center. Developing business relationship, trust and credibility takes time and it cannot be developed overnight.

The first step in improving the quality of customer support service is to improve your relationship with the employees. Involve them in major decision making, give them the feeling of ownership and acknowledge their achievements. It will help in increasing their morale and loyalty. Inspiration is an important factor in improving the role of your employees towards their commitment to high level of excellence and professionalism.

Besides satisfying existing customers on their interaction, it is also a good idea to keep their interest alive in the company. There are various avenues to stay in touch with your customers and prospective clients. There are companies who bombard their customers with chain of strong sales messages which in turn adversely affect customers’ reaction. There is no harm in sending a few softer sales messages. If possible, phone contact and face-to-face interaction is more effective.

In this turbulent economic time customers tend to look for low cost alternatives and it is becoming hard to keep their interest in your products and develop their trust in the company. Now the question is how you can keep your customers satisfied and maintain their confidence. The first and foremost thing is that your front line champions of customer service should be well trained to listen to and understand the customers’ requirements and concerns. For this purpose a weekly performance reviews with all your agents are very helpful in maintaining the minimum required standards. This is very important to quickly and effectively resolve customers’ issues. In resolving the issue exceeding their expectations and make the process simple and easy will further enhance their interest and confidence in the company.

How to Be Successful in the Service Industry

Wondering how to make your splash in the sea of service providers in the market today? It’s true what they say-it really is all about customer service. Here are some tips to keeping your customers happy and returning for more of the service you provide:

Be friendly.

Remember that when a customer hires your company, they are not just paying for the service; they’re paying for you. Of course, they expect the job to be done right, but they also expect you and your employees to be friendly, courteous, and respectful in each and every correspondence and point of contact you make with them. From the secretary who answers the phone when they call to make an appointment to the person who shows up at their door to provide the service, they expect smiles, greetings, and common courtesy. Think of this as an integral part of the service you’re providing, and you’ll be giving yourself and your business a leg-up on the competition.

Be professional.

No matter what service you are providing to your customer whether it be a manicure, a house cleaning, or a septic tank service, you and your employees should conduct themselves with professionalism at all times. This means dressing appropriately and professionally, managing communication with the customer politely and effectively, and handling the customer’s possessions with care and respect. If you are good at what you do, but fail to exude professionalism, your business will suffer as a result.

Be dependable.

Make sure your customers can depend on you to provide services when you say you will. For instance, if you state that your office hours are from 10-5 everyday, don’t leave at 4:45 because if and when the phone rings, you will likely have lost a customer. If you promise to provide a specific service, no matter how small, make sure that it is done and done right every time. Keep your appointments, and never be late. If you’re reliable and dependable, your customers won’t have the need to call your competitors.

Guarantee your services.

Give your customers confidence in their decision to hire you by guaranteeing your services. You can either offer them a money-back guarantee if they’re dissatisfied for any reason, or at the very least, assure them that you will make right on any mistake or less-than-quality service. If they know you stand by your work, then they’ll feel much more comfortable paying you for your service.

Offer a competitive price.

Even if you offer impeccable service in a dependable and professional way, your business may still find itself gasping for air if you don’t offer a competitive price. Do your homework and find out what other service providers in your area and in your niche are charging, and then match or beat their price. Starting out, you should offer the lowest price you can while still turning a profit-at least until you build your brand, your reputation, and your customer base.

Follow-up.

To maintain your customer base, you need to be sure to provide service even after the sale. Don’t assume that a one-time customer will return to you for future business, even if you did a great job. Make the effort to keep your brand in the back of their mind. For instance, you could call a few weeks after the service to see if your customer is completely satisfied. Or, perhaps you could send monthly reminders for follow-up services or “Thank You” cards to communicate your appreciation for their business. These seemingly small efforts, when performed consistently could potentially result in a hefty return on future business.

The most important thing to remember when working in the service industry is that the service itself is only half of your business. What’s the other half? You and your employees. If the customer likes your work but finds your customer service lacking, they may look elsewhere and even pay a higher price for a company who acts as if they appreciate their business. Slap on a smile, shake hands, and bite your tongue if you have to-whatever it takes to keep the customer happy. The happier your customers are, the more likely they will spread the word about your business, and return to you for future service calls. And what does that mean for you? A healthier-and happier-bottom line.

The Service Industry Entrepreneur Employee

My definition of a Service Industry Entrepreneur Employee is very simple: “An individual who, rather than working as an employee, takes ownership of their work, just as much as an individual who owns and runs a business.” Why is having such an individual on your team important? Well, if you feel like you are “doing all the work around here”, you need to keep reading.

Have you ever been frustrated by an employee who could perform better? But they aren’t. Perhaps they could become your best employee, best server, best bartender, best cook. But they aren’t. They could be a manager someday, and a great one, but they aren’t ready to make the jump? You see more in them than they see in themselves. Sound familiar? I’ve been in that same situation. So, why aren’t they? Because they don’t believe they can. They do not have an entrepreneurial mindset. There are various reasons for this. As managers, we can eliminate some and replace them with entrepreneurial empowerment.

Many people, employees, mid-level managers, and even top executives could accomplish something more, something great. But they don’t. Why? Because they are too attached to being comfortable. They’re comfortable where they are, and performing how they are performing. They are so attached to their current job level that it becomes a part of their identity, and it’s not always a good one: “I’m just a cook”, “I just wait tables”, “I’m only an assistant manager, not the real boss”. These employees allow themselves to be defined by their job, their income, their status in the workplace. And it hurts them. They’re comfortable doing what they are doing and it might be easy for them to do their job, but they’re not happy. And they work for you. Congratulations. Over 73% of your younger employees, when asked about their strengths and weaknesses, will focus on their weaknesses. This is higher than any previous employee group surveyed. (Time, September 28, 2012, “Note to Gen Y Workers”, Jane and Marcus Buckingham)

Odds are that if you are reading this, you are “the boss”, the manager, the person with the accountability and the responsibility for the performance of these types of people. And society reinforces the perception these employees have of themselves at almost every turn. Here is a simple example. What’s the most common question that people ask when they strike up a conversation with someone they’ve just met: “So, what do you do?” I have managed tens of thousands of employees and worked one on one with hundreds of managers. And I still sometimes find myself asking that question too. Oops. Worse yet, I have heard guests and customers ask my employees “So, what else do you do?”, like their current job is not good enough. Wow. Now there’s a self-esteem booster for your full time, key employees. I’ve seen the faces of some of them as they walk away from the table or guest after hearing that. Have you ever slowed down enough in your busy day Mr. or Ms. Manager to notice, or to care?

So, how do you help employees with this emotional aspect of the business? You don’t help fix it for them. They help themselves. You allow them the freedom to have, what I once heard coined, the “Entrepreneurial Mindset”. This is the freedom to think and act like an owner in their workplace. Most employees in the service industry never have this freedom. Ever.

Hospitality employees are usually younger, the “generation y”, the “millenials”, the “teacup employees”. They are thought of as delicate and pampered and easily shattered. They always “got the trophy for finishing the soccer season”, not for winning the championship. You and I have probably heard the same stories and the same analogies. The topic has been beaten to death in management-oriented writing. I cannot claim to be anywhere near an expert on the topic. But I do know one thing: people like to feel good about themselves. And I have worked with many younger employees. They’ve told me many things. The most recurring item is also the most emotional: they want what they do to mean something, and they want to feel important. That trophy, which was the same as every other kid’s, didn’t make them feel good. The “helicopter parents” who hovered over their every move, and told them how good they were for taking that test, “C-” score and all, didn’t make them feel good. How do I know? I talk with them.

I once heard one of my best employees, Steve, answered that guest question “what else do you do” with “Oh, I’m just a waiter.” I winced as I walked past. I hoped the guests didn’t notice. My coaching piece with Steve later was as simple as it was true. I said “Steve, seriously ‘Just a waiter’? In my restaurant, each server brings in over $31,000 a year in revenue. You are a full time employee, and a valued one, your contribution is probably about double that figure. This is a multi-million dollar restaurant. And you help make it run every single day.” Steve was important to my business.

So, yes. Your employees certainly mean something to somebody. They are certainly important to somebody: you. Do you tell them how important they are? Do you say “Thanks” to each employee for one small thing every day, hopefully some behavior you are trying to encourage? Be honest with yourself, and no crossing your fingers under the desk.

Let’s examine a common service industry scenario and apply the entrepreneurial mindset to it: the “problem table”. Don’t pretend that you never get them. We all do. So, pretend Steve works for you. He is 21 years old. He comes to you with a long list of complaints from one of his tables: “The food came out cold, the bartender made their drinks wrong, they say it is too cold in here, and they’re really mad”. Then Steve stops. He stops speaking. He also stops thinking, and moving. So, what do you do? Oh: you fix it. You get tell the cooks to get fresh hot food working. You turn the air conditioner warmer. You tell the bartender to remake those drinks. Then you get right out there to the dining room and visit that table and grovel for a while. What exactly does Steve do? He does what he was trained to do by almost every restaurant I know of: tell the manager. This is followed by doing absolutely nothing, except perhaps to complain about the table to his coworkers. At what point does Steve have freedom to act? Is he allowed to fix these problems himself? Do you let him? Do you trust him? And if that answer is no by the way, why do you let him continue to be the face of your business to the public?

Okay. I do admit that, yes, someone else other than Steve has to fix the A/C issue. But Steve’s freedom to act on everything else is up to you. Is the culture in your workplace “I got it”? “I” meaning you in this example. Or, is it “What have you done to fix things so far, Steve?” Do you let him ring up the new food first to expedite time, and to offer the guests some soup or a salad “on me” so they do not sit hungry and unhappy at an empty table? Can Steve ring in another round of drinks without checking with you first? If not, why not? If it’s a theft issue, remember what I just said: Steve “rings up” everything. He just doesn’t “ask” the bartender or cook for it. There is an accounting control there. You must remove it from the bill later, before it’s presented. Financial risk: minimized. Steve: empowered. He is in control, like an owner of his table and all that happens with it. Steve is then an entrepreneur in a most basic description of the word: “Entrepreneurs take initiative, accept risk of failure and have an internal focus of control”-Albert Shapero, 1975. Steve has been trained and allowed to take care of the guest first, then inform the manager, and worry about the rest later. So when Steve goes back to the table he doesn’t say “I’m sorry. A manager will be over shortly.” Instead, Steve says “I’m sorry. This is what I’ve done to make things right for you… “

Answer these simple questions. In which situation does Steve feel important, needed and successful? In which case is Steve given the ability and flexibility to use an entrepreneurial mindset? More importantly, in which situation would you like to be that guest?

You might be saying “But that wouldn’t work in my restaurant.” Really? Why not? Truths are timeless. Here is one you have probably already heard: You’re either growing or dying. It’s true of people. It’s true of plants. Managers need to allow people to grow. Yet, you can’t nurture people to grow, develop, and become better if you do not have a system and culture in place that permits it. You’re either growing or dying. There is no staying the same. People who say “I want things to stay as they are” just don’t get it. They’re too comfortable. The only time people are comfortable is when they are not doing anything new.

Give your employees the freedom to act beyond the boundaries of “normal”. Allow them to be uncomfortable with the “new normal”. And they will grow. Will Steve be uncomfortable taking ownership of “problem tables”? Yes. Will he feel empowered after a few successes at it? Definitely. And if he fails, will you support him, coach him, and retrain if necessary, or will you just say “You tried really hard, Steve. Nice job.” Then give him the same trophy as all the other kids got at the end of soccer season?

There are many of you reading this that will be saying this is too simple to work, or it can’t be done, or blah, blah, blah… ” Apparently, you might just be too comfortable with the status quo yourself. People are always comfortable setting repeats, not records. You have to take a leap of faith.

Managers manage in the moment. Leaders develop, learn, teach, and grow for long term impact. They take risks. I challenge you to find it in yourself to be that leader, to get out of your comfort zone. Become an agent of change, and improvement, for your employees. Become an entrepreneur yourself. “Entrepreneurs are innovators who use a process of shattering the status quo… “-Joseph Schumpeter, 1934. Truths are timeless: If you don’t exhibit leadership and do it, your employees won’t exhibit leadership and do it. Then, someone else, perhaps your boss, might just be looking at you someday, thinking “This business needs to grow and to perform at a higher level. And that manager is just too attached to being comfortable to try anything new. He could be such an impactful leader, but he’s not. I see more in him than he sees in himself.”

Let that not be you.