You’re Doing It Wrong: Why Customer Service Is More Than A Cost Center

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Several years ago, I got my start in customer service in a call center for a major software corporation. I didn’t start at the top or even in the middle; I was a frontline technical support analyst. Over time, I advanced in the organization, eventually becoming the manager of multiple supervisors, overseeing technical support for three major product lines. That was several years ago. I had seen customer service from the trenches, where it’s all about solving the issue for the customer on the phone, as well as from the management side, where the challenge became solving the problems by operating the business as efficiently as possible. Since those days, I’ve seen many things change in the field of customer service, yet I find many businesses maintain some faulty views about their customer service business as we had so long ago. For the next few weeks, I’m going to explore some of the opinions and issues we grappled with and how many companies still look at them incorrectly just as my former company and I did. This week: changing the perception that customer service is simply a cost center.

The Stigma

Throughout my tenure managing technical support, it was referred to as a cost center. Typically with disdain. It was a dirty term. Our team was doing nothing for the bottom line was the thinking. In fact, because my team was the largest, we were a particularly big problem. I looked around for a definition of cost center. My favorite comes courtesy of Investopedia.com. It starts off stating the exact business climate during my time managing the contact center:

“A department within an organization that does not directly add to profit but still costs the organization money to operate.”

It further gives an example:

“The customer service center of an entity only generates costs such as salaries and telephone expenses.”

That pretty much sums up how my department was perceived at that time. While being labeled in such a manner seems bleak, we had some hope.

Recognizing The Cause Of The Cost

Like most software companies, a big focus was on quality. Unique within the company, however, was the fact that the business unit leaders had acknowledged that the reasons customers called (some of the reasons, anyway … more on that in a moment) were as a result of actions by the development and quality assurance groups. Though a cost center, technical support was a consequence of problems outside of customer service. By working together to identify and squash the bugs, this would decrease software problems and meant fewer calls–and fewer calls translated to lower costs. Even today, many companies haven’t grasped the fact that customer service can’t fundamentally impact the reasons customers are calling, emailing, and chatting about product and service issues. They might deploy tools and technology to make service more efficient, but they are only answering questions and not addressing the real reason customers are contacting them. If your customer service is still perceived as a burden to the organization, this is the first hurdle to overcome. Customer service did not create the problems, they are there to respond to customers and provide a solution. Your organization must understand that customer service should really be an investment in reducing costs for the company. As we found, those costs often come from unexpected places.

Solving The “Whole Product” Problems

Remember how I said the business unit leadership was interested in addressing the reasons customers called, but mainly from the perspective of improving the product quality? My technical support team did its part by logging cases to record the reasons and details of customer calls. We ran reports from the call tracking system and counted rows in spreadsheets to generate our “Top 10” lists each week of the highest volume issues to discuss with our product team. During the weekly Top 10 list review, we would discuss the details of each item on the list and negotiate what the approach and timeline would be to addressing them. Some weeks customers were calling about more than just software bugs. Not only did customers struggle to use the software, but they were also challenged to work with the company: credit card charges were incorrect; upgrade orders lacked tracking information; rebates weren’t issued; manuals were missing; etc. When things were not working as expected for our customers–software bug or otherwise–that meant the phone would ring. Each one of those calls had a cost. The weekly discussions with the product team became just as much about business problems as they were about software quality. The conversation was no longer limited to software development issues but also matters stemming from manufacturing, accounting, etc. and how to address them. What we had started to touch on is what we now know as customer experience. The problems we encountered and helped solve were not always about the software but impacted the customers’ experience with our product and company. Our concern was centered on reducing the costs resulting from any type of call for assistance, but we were also improving the overall experience for future customers as we eliminated those software and business issues.

The Modern View

There is no denying the cost associated with delivering customer service. While technologies like chatbots and automated solutions can reduce costs and CTI and knowledge bases can make agents more efficient, at the end of the day, there is a price for it all. Yes, from an accounting perspective, customer service is a cost center. But if your company is only focused on this, you must change that old-school thinking. Your customer service center is really an opportunity center. It’s an opportunity to hear directly from customers. It’s an opportunity to identify and correct product or service problems. But it’s even more than that. By taking a broader perspective and going beyond product problems to include identifying business processes issues and by engaging with the rest of the company to solve those issues, it offers the opportunity to improve the entire customer experience and reduce even more costs over time.

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