Online Service: Don't Ruin Business Case By Scoring "Own Goals"

Jason Price
Posted: 10/01/2017

Soccer Image

Online services are everywhere. It’s rare to find an organisation that hasn’t been told how they could improve their customer service and make efficiency savings by moving more of their services online.

There’s plenty of evidence of the realistic, tangible efficiency and customer experience gains available from the successful introduction of online services. Don’t worry, this article isn’t going to criticise your multi-channel, omni-channel, channel shift efforts. Take heart, you’re on the right track.

However, as any Premier League soccer player knows, there’s no cheering from the crowd if you turn around and stick the ball into your own team’s net. How can you ensure that your organisation’s actions don’t lead to ‘own goal’ service delivery failures that will leave your online self-service business case (and personal reputation) in tatters?

Translate the sales brochure spin into real world benefits

Firstly, let’s remind ourselves of the benefits promised by the sales and marketing people advocating for their particular technology product. Online service is great for the customer. Access is faster, more convenient and available from anywhere in the world, 24x7. As long as your customer can access the internet, they’re able to get things done on their terms – any time, any place, anywhere.

But it’s not just good for customers. Organisations investing in online services can reduce their costs too. Moving customer contact from more expensive telephone, face to face and good old snail-mail post to e-mail, web, app and social media service channels allows organisations to cut staffing and business process costs. In the sales and consulting jargon, you’ll hear people raving about the benefits of “channel shift.”

Here ends the marketing leaflet promises from <insert your choice of omni-channel product vendor here>. For readers who hold sales people in the same regard as politicians (remember that old joke - “How can you tell if they’re lying? Because their lips are moving”), contain your scepticism. These benefits can actually be achieved in the real world!

Build a realistic business case – trust, but verify

The thing about any benefits case is that it’s based on assumptions. During implementation, these assumptions must apply to your individual circumstances if your benefits case is to be anything other than fiction that would make J.R.R. Tolkein proud.

If your situation doesn’t fit with the way that product XYZ must be used in order to claim the benefits promised, you’ll find that part of the sales pitch is actually going to deliver next to nothing for your organisation. Never has the “trust, but verify” wisdom of former US President Ronald Reagan been more applicable.

Let’s illustrate this by looking at my recent experience of renewing insurances. My insurer has taken online service delivery to heart. One month before my insurance renewal is due, I receive a cheery e-mail encouraging me to renew online. I’ve had three of these e-mails in the last few weeks, as different policies all renew at roughly the same time.

Here’s what this simple three step renewal process involves. I’ve added some business case notes of my own to help illustrate the benefits case for online service. 

Service delivery stepCustomer benefits caseInsurer benefits case
Send customer renewal notification by e-mail. Include a downloadable document and link for online payment by credit card.

* Advance notification of renewal 1 month before the due date giving time to pay

*  View renewal document online, at my own convenience

*  No postal delays

*  No wasted paper to recycle at home

*  Ability to shop for better deals with other insurers online whilst renewing at a time convenient to me

*  No annoying sales phone calls disrupting my evening at home or workday

Dis-benefit: Answers to why my premium / excess has risen so much this year unavailable online requiring a phone call, or shopping around

*  Advance notification of renewals to prompt early payment.

*  Reduced postage costs using e-mail not paper

*  Call to action to online payment (step 2)

Dis-benefit: Technology investments to manage automated e-mail from CRM or Policy Management system(s)

Dis-benefit:  Some customers unhappy with renewal terms may churn without sales staff being able to discuss with them or offer retention deals
Pay policy renewal online by credit card

*  Payment any time by credit card

*  Convenient 24x7 access, faster than queuing in a call centre

*  Reduced risk of forgetting to renew and leaving house/car/family uninsured

*  Immediate payment by credit card improves cashflow position

*  Increased interest earned on payments received early

*  Reduce costs of achieving policy renewals through prompt customer payment

*  Reduced contact centre call volume (and hence staffing costs) by online payment

Dis-benefit: Cost of implementing online payment gateway, linked to customer policy
Instant notification of cover with downloadable policy documents

*  Reassurance of instant cover backed up by a written policy cover note sent by e-mail and presented online for download

Dis-benefit: Cost of printing my renewal at home if I require paper evidence for a claim when my  house is damaged by a flood/fire/tree/earthquake – Don’t laugh at this, some insurers really do ask for receipts/proof!

*  Reduced postal costs

*  Reduction in time from policy notification to confirmation of policy renewal

*  Improved organisation cashflow

*  Reduction in customer churn and increase in renewal rates

Dis-benefit: Cost of implementing online document management gateway, linked to customer policy and payment systems

As you can see, there are plenty of benefits that can be identified for both the customer and the insurer. I’ve also taken the time to identify things that reduce the strength of a business case (in programme management jargon, these are called ‘dis-benefits’).

Dis-benefits are a critical item in putting together your business case. If you’re dealing with supplier sales people, you might have to get the thumbscrews out to find out about them though. Sales and marketing people tend not to be up front about the downsides of their products in presentations and brochures.

Overall, this online renewal process seems like a straightforward case with some great savings and customer experience benefits. How then, did my insurer’s business case collapse into nothing on every one of the three renewals I’ve tried (and failed) to renew online this month?

Snatching defeat from victory : scoring the own goal

It all started exactly to plan. On receiving my premium notification e-mail, I downloaded my renewal documents and followed their instructions to pay online. So far, so good, tick all those benefits off from step 1.

Step 2 – Online renewal payment: Process failure own goal and business case collapse

Everything was on track, right up to clicking ‘pay now’. This is where it all went to hell in a handcart.The on-screen timer ticked away before morphing into a humorous screen of death cartoon depicting an angry customer with the message “uh-oh, something went wrong. Please call our contact centre”.

It’s good to see they have a sense of humour about making their customers angry.

Three times I’ve tried to pay online for a policy and three times I’ve had to phone the contact centre to make that payment over the phone. The root cause issue? It turns out the billing system doesn’t generate the renewal invoice at the same time as sending out the renewal e-mail. The contact centre agent even told me I was just a bit too organised. However, this is exactly what the insurer wants me to do by sending a call to action e-mail with clickable ‘renew online now’ links.

What does this mean for the benefits case?

  1. Savings are not delivered. Customer “channel shift” is not achieved and the volume of contact centre calls does not reduce. In fact, customers use both channels, it takes twice as long and those calls are likely to be even longer as customers express frustration and complain about having to do things twice.
  2. Contact centre staff reductions cannot be delivered, as transaction volumes do not fall. Cost savings are not delivered.
  3. Customer efficiency benefits are not achieved. In fact, frustration increases at having to do everything twice and annoyance level rises as the contact centre IVR messaging chirpily tells you “it’s faster to do it online.”  No, it isn’t. I just tried. You failed.
  4. The customer loyalty relationship suffers reputational damage. The customer’s perception of their insurer changes from being an efficient organisation offering online convenience to a company that doesn’t test its processes or its technology properly. It’s seen as a wasteful organisation that disrespects its customers’ time and money. Whilst waiting in the IVR queue, customers now have the time to Google the data that tells them their renewal notice premium increase of 15% is delivering an increase in the insurer’s profits of 8.4% and a Chief Executive’s annual salary package of $1.3m.  It’s good to have something to keep you busy whilst listening to hold music.

Learning the lessons: take away points for building realistic business cases

What can we learn from this case study that will help us avoid scoring this kind of own goal for our own channel-shift business cases?

  1. Properly map business processes – by visualising the end to end renewal process from the customer’s perspective, the disconnect between renewal call to action and online billing would be obvious. A well documented process map helps you identify, and therefore avoid, key points of process failure.
  2. Learn from customer complaints and feedback – ensure that customers can provide feedback and give contact centre advisors a simple way to register customer complaints and feedback for improvement action. Analyse your complaints and focus improvement projects on fixing customer pain points. Don’t just leave your contact centre advisors managing customer frustration without learning how widespread the problems in your business are.
  3. Validate business case assumptions with real life service data. Measure everything – at the start, during delivery and at the end. Compare this to planned business case promises. Every benefit proposed in a business case must have an associated measurement method, which is followed through to testing and realisation. Without this, you’ll never know if the value you were sold in the technology product sales pitch is actually delivering anything to your organisation.

The benefits from online service improvement are real, but only if you apply technology and process improvements that match your own circumstances and needs. There’s no substitute for preparation, planning, testing and checking that you’ve made the right assumptions.

It certainly beats explaining to the rest of the team why you decided to turn around and put the ball squarely in the back of your own net.

Jason Price
Posted: 10/01/2017

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