With the economy taking a downward spiral in recent months, it is important for companies to be prepared to face a recessional period. Andrew Stacey founding partner of Custometrics, discusses the measures that businesses need to take to survive . In a recession very little changes from normal business life, it just gets tougher.

As the recession deepens, managers will be under greater pressure to do three things: the first of which is obviously to save money.

But how to do it without damaging the business, and allowing for growth when the time comes?

The easiest and quickest thing to do is fire hoards of people. They are expensive assets to maintain when sales begin to dry up. The cheap ones are the cheapest to make redundant, and their costs do add up. But will their lack of presence create serious holes in the business?

Next, assess every project – capital or otherwise. Be it new IT, a partnership program , CRM, new transportation or a new building. The old adage of ‘STOP’, START, CONTINUE comes immediately to mind.

What can be stopped? Can it be done without negative effect on the business? How many people might it free up for the redundancy queue? How much would it save in outside suppliers costs? Will it pre s e rve cash? Or what should be started? What can be done in the immediate term that will have maximum, positive effect on the bottom line, or improved cash flow? Or by doing something now, will it generate a serious advantage over our competitors?

And then continue. Continue things that are already providing maximum benefit to the business. But beware – would it cost more to stop rather than continue? Or can completion be brought forw a rd? How might scaling back improve ROI?

Then it’s the turn of the Directors, Managers or Owner/Managers to look at themselves. The (remaining) staff can still be motivated, if they see the bosses suffering as well. First Class travel, chauffeurs, lunches, waiting taxis, all need to be pared back. And there are n u m e rous budget pots that can be trimmed, from flowers to newspapers and magazines.

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E v e rything that can be looked at needs to be looked at. If there ’s no good reason to spend cash, don’t. It’s far better off in your company’s bank account than someone else’s .

The second important area is protecting your existing customers

Firstly look at the profitable ones. How will the recession affect them? Then look at their customers, and so on up the supply chain. How will all their re c e s s i o n a ry actions filter down to, and beyond, your company?

Investigate processes and pro c e d u res for handling customers. If they can be made more e ffective and efficient then everyone wins. A recession is a good time to discuss with customers how you both might take on these t roubled times together.

How can interactions be streamlined? It then becomes a dialogue, initiated by the supplier, instead of an edict promulgated by the customer. Then look at the unprofitable and marg i n a l l y p rofitable. It is unlikely they will magically become more profitable in a recession. Can they be isolated, in a ‘managing the re l a t i o n s h i p ’ sense, from the rest of the organization? And t h e re f o re, can you manage them out of the business, or do some thing that increases the m a rgin, such as reducing service levels.

T h i rd on the list is to try and sell more

This is always difficult, at any time. But recession can bring out the best in some companies – they will try something new or d i ff e rent, maybe they’ll even take a miniscule risk. That ‘try something…’ might be your c o m p a n y ’s products or services, but customers will want the same, or even more – for less.

So look at the pricing strategy – what can be o ff e red that may bring in more business? Recession is a good time to watch your competitors in an even more hawk like way than usual. Are there signs to show they are having problems, or weathering the storm better than you? If your company is successful, a re they a potential take over or merg e r t a rget; if not are you?

Recession is all about survival, and to paraphrase Darwin ‘only the fittest surv i v e ’ . And that’s not just fit for today’s business. The winners will be those businesses that are fully fit to accept, and ride, the wave of change for the future .

L a s t l y, it’s a good idea to keep a ‘re c e s s i o n a ry mentality’ when times get better. It is a pity, from a shareholder viewpoint, that when things improve, company Directors and Managers forget how to operate in a recession. Recessions are not new, they are just cyclic phases. But many of today’s managers will not have managed their way t h rough a recession, so it’s a great time to l e a rn. There will be another one – guaranteed. This article has been re p roduced with the kind permission of Author: Andrew Stacey (custometrics.co.uk) originally published in the Sales Director December 2001.

 

 

I am sure that we all have our ideas of what constitutes good customer service, after all most of you that are reading this article will deal with your companies customer service department daily. But just how important is good customer service? How can it impact our sales? In short how do we improve in this crucial business activity?

With this short article I hope to highlight the i m p o rtant role that customer service plays in our business activities. My objective is to raise the profile of the subject with you all, but we will merely scratch the surface of this subject in the space available.

1 What is the biggest single reason why businesses lose customers? A New competition B Indifference of one employee C Word of mouth D Dissatisfaction with the product 2 What percentage of dissatisfied customers does not complain to you about discourteous or indifferent customer service ? A 48 % B 65 % C 78 % D 96 % 3 Of those customers who do complain, what percent is likely to return to that business again? A 50 % B 70 % C 80 % D 90 %

4 For the average business, what percent of annual sales comes from existing satisfied customers? A 30 % B 10 % C 65 % D 50 % 5 How much more money does it take to find a new customer instead of getting more business from an existing one? A Twice as much B Three times as much C Four times as much D Over five times as much 6 A dissatisfied customer will tell how many people , outside of the company, about poor service received? A Two to three people B Four to six people C Seven to eight people D Over nine people, but as many as twenty

In analyzing each of these questions in a little more depth we can see the following:

Why customers leave? The single biggest reason is the indiff e rence of one employee, with 68% of the responses of those asked the question: “What was the factor that influenced your decision not to buy that product or service again?” The point here is that every single individual can and does make an impact on both the customer’s experience, and the company’s reputation in the marketplace.

Who complains? Ninety-six percent of dissatisfied customers do not complain to you about discourteous or indifferent customer service: we only hear from 4 per cent of our dissatisfied customers. This means that for every complaint received, there are in fact 26 other customers with problems, six of which are serious issues. The rest either give you their opinion by not returning, or complain to anyone else outside the company who will listen. In order to create and deliver excellent service, we have to create the means for customers to complain to us. Only when you know of the problems customers are experiencing can you resolve them.

Who re t u rns after complaining? If the complaint is not handled effectively, only 50% will do business with that organization again. A study by BA showed that if a complaint is handled quickly and effectively, over 95% of customers would return.

What sales come from existing satisfied customers ? Many of you will have heard varying answers to this question. The most conservative data infers that at least 65% of sales come from existing customers. Some may be more familiar with the 80/20 rule. Whichever data you use, it is compelling!

What is the cost of finding new business? Again the answer differs depending on which source you use. The data I am using shows that it costs five to ten times as much to generate business from new customers as it does existing ones. I am sure that you will all have experienced companies both in healthcare and outside that spend vast amounts of marketing budget on getting new customers, and then ruin the experience at the point of delivery.

How many people do dissatisfied customers t e l l ? The average customer who has a pro b l e m tells nine to ten people about it. Then of course in the electronic age, there is the intern e t where potentially thousands can hear about it. Then your competitors use this bad news against you, further spreading the word. Conversely good news does not travel as quickly. On average a satisfied customer will only tell three to five people about the experience. In other words you have to deliver much more good service to outweigh the possible negative consequences of bad service . As we have already seen excellent “Customer Service” in all it’s guises is really very important to your customer, your company and of course you. Without strong support from your customer service department, and a customer service mentality of your own, you will struggle to do business with customers and they with you!

So how do we exceed our customer’s expectations? Well the first thing you must do is measure the customer’s satisfaction, after all, if you can’t measure it, you can’t manage it. And if you don’t know where you are, how do you know where you want to go? There are various methods of measuring customer satisfaction (enough for another article) so I won’t go into in detail, your company may well have a method already. In order to effectively manage moments of truth (any point in a customers interaction with a company where there is an opportunity to form an impression of that organization) , applying a service management model is essential. Based on a model originally devised for British Airways and incorporating a continuous improvement philosophy, the process defines critical activities necessary to ensure consistent excellent service delivery in five specific areas ( see Figure 1).



1 Establishing a clear customer service strategy.
2 Ensuring the correct people are in place, with the correct skills to deliver outstanding personal service .
3 Establishing clear material service (price, timing, quality and quantity of equipment, products, delivery procedures, information , routines etc) delivery pro c e s s e s
4 Improving continuously in terms of process improvement, quality monitoring and recovery.
5 Management playing a key daily part in acting as role model for the delivery of these principles.
Establishing a customer service strategy
To establish a clear customer service strategy certain key actions are required :

1 Understanding the overall organizational vision and mission.
2 Defining the organizations customer service direction .
3 Creating the organization ’s customer service slogan.
4 Establishing the organization ’s customer service values.
5 Ensuring that customer service is defined as a key responsibility for the business/ department or subsidiary.
6 Sharing the customer service vision via a comprehensive communications programme to all.

Hiring, training and keeping the right people
Ensuring the right people are in place, with the correct skills to deliver outstanding personal s e rvice, requires :

1 Hiring the right people.
2 Providing training in key areas re q u i red to deliver exceptional personal service .
3 Providing ongoing coaching and feedback on personal service skills.
4 Motivating employees to produce outstanding results .

Managing the material service delivery processes
This critical step involves defining, reviewing and improving service delivery processes and procedures. This requires :

1 Mapping the service delivery processes
2 Evaluating critical success points in the process .
3 Establishing service delivery procedures to optimize material service .
4 Creating service level agreements .

Instituting continuous improvement processes
1 Continuous improvement involves reinforcing and adapting both personal and material service delivery processes on an ongoing basis.
2 Actions used to reinforce personal service standards are the designing and building of follow-up tools and activities to aid retention .
3 Actions used to reinforce material service standards include applying problem-solving to short term service issues and quality management initiatives.


Managers role
The key role in the service delivery process is played by the management team, which is responsible for:

1 Helping to establish the strategy
2 Understanding the key skills required to deliver outstanding personal and material service .
3 Establishing, monitoring and updating service delivery pro c e s s e s .
4 Coaching employees in personal and material service delivery skills.
5 Acting as an example in delivering outstanding customer service.

It is the manager that plays the critical “make or break” step in customer service delivery.

As we can see, delivering exceptional service re q u i res a clear customer service strategy, effective internal standards and processes, customer focused people using competent interpersonal skills, continuous im p rovement and managers who lead the initiative. My main message is – delighting the customer is an ongoing process. It never ends. “Going the extra mile” as both an organization and an individual, can leave a memorable impression that the customer talks about time and time again. It is those stories, which will create a reputation in the marketplace and build long-term viability for your business.

Duncan Wilson

duncan.wilson@ontargetmag.com

 

 

 

Whether you are an old hat at interviews or this is your first time, it can still be a very daunting experience and bring fear to even the most confident of people. So what makes a good candidate and why do people throw some applications straight in the bin.

Unless your father owns the company or you a re born into money, at some point in our lives we all have to deal with interviews. And it is amazing how interview skills can leave much to be desired from both sides of the desk. In most scenarios, neither the interv i e w e r s nor the interviewees pre p a re enough. It is incredible how many people will go along to an interview without first doing research into the company and the interviewers who have not even read through the CV.

T h e re is not one right way to conduct a job interview. All parties need to tailor their approach specifically. In the present climate however, giving your best interview performance is vital. An experienced sales manager share s their knowledge of interview technique.

•HAVE A WELL WRITTEN CV. E n s u re you CV is well written and concise. The long-winded CV is a real no-no. Employers have hundreds of C V ’s to wade through and a short attention span, so no one wants to read through pages of information. If you can’t convey your key messages and skills in a couple of pages, you are unlikely to get an interview.

Moreover, we are looking for our salespeople to be good communicators, so you should demonstrate this on the CV. Most people concentrate too much on their job description but the most important things are what you actually did, changed or updated. What were your major successes, achievements, things that got you noticed? Achievements on a CV a re critical and many people put none. And don’t forget, gaps on CV’s still raise questions.

•PREPARE This sounds like such an obvious one, I know, but we still get candidates turn i n g up for an interview with only the faintest knowledge of the company. If someone is serious about working with us, I would expect them as an absolute minimum to have re a d the information on our website, to have gained at least a basic understanding of our firm , products and market positioning. Then make sure you know whom you are seeing and their role within the company. Find out the structure of the company and where your position would fit in. Then use all this information that you have collated to formulate questions for the interview.

•TURN UP ON TIME FOR THE INTERVIEW. Again, this might seem obvious, but you wouldn’t believe how many times I’ve had candidates call me to say they are going to be delayed, perhaps because they missed the train, they ’ re stuck in traffic, or the cat’s been sick. Or the number of people who phone up and ask if they can reschedule for another day. The mistake they make I think is treating the interview as though it is just another business meeting, which of course it’s not.

•EMPLOY A STRUCTURED QUESTIONING TECHNIQUE . I would expect experienced salespeople to take a methodical approach to questioning, and to demonstrate this to me in the interview. They should certainly not be shooting from the hip. That’s because the interview for a sales person is in truth a dummy sales call, certainly from the perspective of an employer looking to see if you cut the mustard. Throughout an interview for a sales position, the pertinent questions I am asking myself are “How would this person handle my most important customer?” And, “Could I t rust this person in that situation?”

•DON’T RAMBLE. One of the worst things you can do in an interview is to ramble on and on. Sales professionals need to be excellent communicators, so all the time I am talking to them I am expecting them to provide concise, considered answers to my questions rather than going off the track. Sometimes candidates go off track to prove a point, but it’s really not necessary – or desirable.

•LISTEN . If a candidate doesn’t listen, this is a very bad sign for me, as listening is a key skill for a sales person. In a customer- facing situation, salespeople need to be able to do more than just ask the right questions. They also need to listen to the answers, and respond accordingly.

•SHOW ENTHUSIASM FOR THE PRODUCT AND MARKETPLACE . If a candidate starts asking questions about our pay rate and commission plan early on in the interview then again alarm bells are ringing. They have already signaled to me their lack of interest in the product and, without enthusiasm for a product, and a sound knowledge of its benefits, how can they expect to sell it?

•DON’T BE TOO GENTLE. The ideal sales candidate should not be too technical or too laid back at interview, and they should seize upon the opportunities I give them during the session to take control. In fact, at certain points they should be interviewing me, since I need them to demonstrate they are capable of leading customers at the right moments.

•PREPARE FOR AWKWARD QUESTIONS. O n e of my favorite interview questions is “What’s the biggest sale you ever made?” But then I closely follow that up with “What was the biggest sale you lost?” I look for candidates that have tendered and lost as well as t e n d e red and won and, crucially, people who have learned from their mistakes. I ask them how they would have done things differently next time .

•PREPARE TO ELABORATE ON YOUR ACHIEVEMENTS The ideal candidate should have a strong track record of achievement that should be apparent from the C V. At interview y o u should expect to be asked to elaborate on any number of achievements, as the i n t e rviewer attempts to establish to what extent those achievements were down to the candidate alone.

•QUALIFY THE DECISION MAKING PROCESS. While for certain positions it might be considered cheeky to ask about the next stage, I would certainly expect sales professionals to qualify the decision making process at the end of the interview by asking such questions as: “What sort of person are you looking for, what is the next step in the process, and how many candidates a re you seeing?” And so on.

•DON’T FORGET TO CLOSE. I f you want to land a sales position, you must certainly demonstrate an ability to close. The interview is your only chance to do that, so you need to close with questions such as: “Do you have any concerns about my ability to do the job? Would you hire me? Questions like this are your best chance to re assure employers you are the person to do the job. If you are interested in landing the job, I would expect you to close me down on it.

Finally another route to the interview may have been through a recruitment agency. In this case you will have gone through one interview already with the agency and they will make the arrangements for the interview with the prospective employer. We asked Darre n Spevick from Michael Page Sales Healthcare how you should handle this situation. He had this to say, “You should treat the interv i e w with the recruitment agency just as seriously as an interview with a company, you still have to impress the agency and want them ultimately to register you on their books and actively seek a suitable position for you, so do your homework before this interv i e w. Have a CV pre p a red, consider the type of position you are looking for, the type of company you want to work for and the remuneration package you are looking for. Also consider your stre n g t h s and achievements so you can discuss these with the agency. The more they know about you the more likely they are to be able to find you the right job”.

But what difference can an agency make to the interview with the company? Darren continues, “A good agency will provide you with a job description and details of who will be interviewing you. They will also provide you with some background information on the company and the type of person they are looking for. A good consultant, with whom you have developed a sound relationship, will be able to offer you some practical interview tips and will help you through the process. Finally the agency should provide you with some feedback, they will inform you if you were successful or not. If you did not secure the job they will give useful feedback as to why this happened and this can help you at your next interview ” .

Oliver Baynes