*My name is Susan Young and I am Doug Brown's publicist. If you have any questions, please feel free to call me at 732-613-4790.* (Do not include this in this article)As someone who has been heavily involved facilitating strategic planning processes with organizations during
last 15+ years, I often find it somewhat amusing how people answer
questions I pose.
For example, if I ask people, “What is your unique differentiation in
marketplace?” or “What does your organization really excel at?” They will almost always reply, “It has to be our client service.” Almost no one will admit to being “lousy” in client service, any more than they will talk about living in an average town with average kids. Instead I see
“Lake Woebegone Syndrome.” In Lake Woebegone it seems all
women are pretty, all
men are handsome, and all
kids are well above average.
If while getting to know someone’s agency or company, I ask
question, “If I hauled you into a court of law and accused you of being a ‘world class’ client service provider, would there be enough evidence to convict you?” Many times, unfortunately, their answer is, “Probably not.”
Therefore, if so many people think client service and satisfaction is so critical to
success of
vision and
execution of
strategic plan, why is it not usually monitored with
same intensity as
financials? After all, financials are a lagging indicator (telling what happened after
fact) while client satisfaction may be a leading indicator (it can be predicting what may happen in
future).
Many organizations go through all sorts of trial and error and purchase various software programs to keep their finger on
pulse of dollars and cents because they want to know where they are and minimize opportunity for loss. For years it has been known that “what gets measured gets done.”
If that is
case, why is it that many organizations choose to almost ignore measuring client satisfaction? By doing so, they run
risk of losing established clients to
competition.
Client Service as Overarching Philosophy In 1960, Professor Theodore Leavitt wrote
groundbreaking article, “Marketing Myopia,” in
Harvard Business Review. To paraphrase, he basically concluded that
purpose of all business is to attract and maintain customers while generating adequate profitability today and improved profitability in
future. That balancing act still holds true today. How many organizations do you know that are masters at bringing business in
front door only to lose it out
back door just as quickly? We have also dealt with organizations that service their existing business so well that
owners and principals “never get around to developing new business.”
Those organizations and agencies that see customer or client service as simply a department to be managed rather than a point of strategic differentiation may be looking at
business through
lens of short-term focus. So many people that we talk with have never calculated
lifetime value of a typical insured and even those that have usually aren’t communicating that number to their staff at every level of
organization on a regular basis. Knowing that number can provide a framework to make decisions for
long haul and maintain
client relationship rather than looking at it from a “transactional” basis.
To calculate
lifetime value, take
number of years that a client/insured usually stays with
agency multiplied by
estimated net profit per line of business (auto, P&C, E&O, DB, etc). The total dollars can give you some idea of what is at risk in
future if you under serve your client base.