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In this down economy, companies are struggling and trying to cut costs. A look at their customer service might be the key. The purpose of such a review is not to turn customer service into a bare-bones operation with one attendant but rather to focus solely on what is really important to customers.

One measure of customer service quality is the average time that it takes for a customer service representative to answer the phone. According to a study of 11 service delivery companies, customers who experience a short wait time (X seconds) appear unexpectedly pleased with the service, whereas those who suffer long wait times (Y seconds) express dissatisfaction. If the phone gets answered somewhere between X and Y seconds, customers indicate indifferent satisfaction levels.

One company from the study decided to focus on not surpassing Y seconds and answering the phone between X and Y. Thus, it could maintain a consistent level of customer satisfaction but also save millions of dollars in costs, which it reinvested into its problem resolution processes.

A bank was considering upgrading its ATM machines with a better user interface and installing screening barriers around the machines for privacy. But its research showed that only 5 percent of customers’ overall satisfaction pertained to equipment; the availability of the machines was what was most important. Customers just wanted to get cash in more locations, not fewer machines with upgraded quality.

This study clearly demonstrates that companies should focus on what their customers perceive as most important. In an era in which companies are strapped for cash and cutting costs, perhaps the best way to save money is to cut those programs that have only marginal effects on customer satisfaction.

Discussion Questions:

  1. Why should companies cut customer service?
  2. How is cutting customer service a customer-centric process?

Adam Braff and John C. DeVine, “Maintaining the Customer Experience,” The McKinsey Quarterly, December 2008.