Drive Up Value and Reduce Costs

Drive Up Value and Reduce Costs

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Long before I started my own company, I recognised the importance for any business to focus relentlessly on driving value up and costs down. It’s a lesson I first learnt in the corporate environment where I witnessed, first hand, the basic truth that if something you do is not explicitly adding value to your customers, it’s almost certainly an unnecessary cost to your company, and one that will probably never generate any sort of return.

After six years of running my own customer experience research and strategy company, my understanding of this value versus cost formula has deepened, to the point that ‘driving value up and costs down’ has become something of an N’lighten mantra, and the philosophy on which we base all the guidance and advice we offer our clients.

Ironically, while this concept of driving up value while reducing costs is basic business sense, in my experience it is a philosophy that is missing from many potentially successful businesses. In fact, its absence is, in many cases, the one thing that is limiting success and ensuring that it remains nothing more than potential.

That’s not to say that these companies aren’t making all the right noises about customer service. It’s just that their efforts in this regard never seem to translate into added customer value, which makes them nothing more than a financial drain on the business.

Customer service excellence

The problem, as I see it, is two-fold. While the vast majority of business owners and managers pay lip service to the importance of delivering excellent customer service, they and their employees don’t fully understand what that actually means. And to make matters worse, there’s no clear understanding of who is responsible for delivering it.

Fortunately, this is relatively easy to fix. All it takes is an understanding of the following three basic principles of customer service excellence.

1. Everything you do should add value to your customer

I mean everything. Buying new shop fittings? If they don’t make it easier, more convenient or appealing for people to shop at your store, they’re nothing more than a cost. Trying to improve servicing times in your workshop? If it makes it more difficult to get the job done right first time, every time, or adds to the possibility of faulty workmanship and customer returns, it’s not really adding value, it’s costing money. Installing a new accounting system? Unless it means your customers enjoy more understandable statements, accurate invoices, or lower prices why are you bothering? I’m sure you’re getting the picture. No matter who you are, or what you’re doing in the business, if you can’t answer ‘Yes’ to the question ‘will this add value for our customer?’ then it’s time to change what you’re doing, or the way you’re doing it.

2. Customer service is everyone’s business

A commitment to value-adding customer service has to start at the top of your organisation. If the Chairman, CEO, MD, or owner is not 100% committed to adding value to the customer, you can’t expect the sales assistant, cashier, waiter, driver, or cleaner to be either. It needs to be listed at the top of every manager’s and employee’s job description. It needs to inform your performance reviews and bonus allocations. In fact, if it’s not the first thing listed on your company values, cross out whatever is and write in ‘adding value to our customers’ in its place.

3. You can’t switch customer service off

Adding value to your customers is not a one-time, or part-time, aspect of your business. It is your business. All the time! Even when there isn’t a customer in sight, your focus needs to be on making sure you can add value to the next customer who steps through your door. If your efforts at customer service are unfocused, ad hoc, or half-hearted, chances are good they’re not adding any real value. Which makes them nothing more than a cost. And if that’s the case, and you’ve made it this far through this article, you know what to do.

Nathalie Schooling
Nathalie Schooling has more than 25 years' experience in the customer service industry. She is the founder and managing director of N’Lighten, a company committed to promoting service excellence through research, training, and strategic insight. For more info, go to the N'Lighten website.