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Thursday, 04 July 2013 06:27

Optus: customer experience is not a cartoon character


Optus announced its new look last week. It has abandoned its menagerie of wild animals in favour of a cute cartoon character and insists that the changes are more than skin deep, that they reflect a new customer-focussed Optus.

However, until prompted Optus said little about what it is doing internally to bring about this change. All the talk was about the new brand and what it signified.

When asked about this at the press conference announcing the new brand, Optus managing director, customer, Vicki Brady, said that internal change had been underway for at least a year. "Our focus has been how we support the people who are closest to the customer to do great stuff. We had a focus on training and empowerment of our front-line staff. They are making sure that when people go to our different touch points: contact centre, online, in store there is a consistent experience."

She said that customers were surveyed after every interaction and there had been consistent improvement, "but we still have a long way to go." Vice president, corporate and regulatory affairs, David Epstein added: "What are now saying to people internally is that the whole culture of 'Yes' has to go through the firm from top to bottom and for everyone is about the customer contact chain. Everyone must recognise that they have a part to play."

A major measure of the success of this transformation will be Net Promoter Score (NPS), a tool that is becoming hugely popular with customer service organisations. Brady said that Optus had rolled this out a year ago. "We now measure NPS across every touch point in our company, every interaction: on the phone, in store, online. Customers have an opportunity to give us feedback they rate us in terms of their willingness to recommend us. That has been invaluable. We have been using that feedback to start to address changes and priorities in our business. We do research and we have analytics but for me the real-time feedback from customers has been a big change for four us."

So Optus has a lot riding on NPS, but so do Telstra, iiNet, the Westpac Bank, CommBank and NAB to name but a few.

The technique has its origins in a 2003 paper in the Harvard Business Review 'One Number You Need to Grow' by US business author and business strategist Fred Reichheld, but is now a proprietary system registered and promoted by Reichheld and Bain & Company along with Satmetrix.

NPS separates customer responses into three distinct categories:
• Detractors: those who rate their likelihood to recommend a company at between zero and six.
• Passives: customers who record a rating of between seven and eight.
• Promoters: those who give a score of between nine and 10.
The actual NPS score is calculated by subtracting Detractors from the Promoters.

Telstra is full of praise for it.  "NPS is a quick and easy way to measure the perception of a company, an individual product or a specific service, allowing a company to focus on areas that require attention. ... If we're not providing outstanding service worthy of a 9-to-10 rating, the NPS research demonstrates customers are unlikely to recommend the company and remain loyal over the long-term."

It adds: "What's remarkable in today's business climate that values complicated analytics, weightings and metrics, is that NPS ultimately presents business leaders with a very simple set of results by which they can run an organisation."

If that sounds too good to be true, it probably is. The technique has many detractors. Check out the Wikipedia entry on NPS and you'll see that most of the entry is devoted to "Criticism of NPS".


And whatever its merits, NPS does little to provide feedback as to what organisations are doing right to create 'promoters' and doing wrong to create 'detractors'. Asking someone to rate their interaction with a company doesn't necessarily get close to discovering the root cause of that rating. For example if a customer is asked for their NPS score after calling a call centre to try and resolve a major stuff up it may not be possible to link their score to its root cause - the stuff up.

The mantra in telcos today is to deliver an exceptional customer experience and there are other ways to get an understanding of that relationship and to assess whether a company is delivering a good customer experience. Optus may well be using them, but if so it kept quite about them

One way is to actually be a customer and rate the experience. Melbourne-based Global Reviews does this by deploying 'customer surrogates' who interact with the service providers' contact centres.

Earlier this year its customer surrogates made 350 live sales calls across nine major Australian telcos regarding two products – Internet and mobile phone service providers. Each surrogate played the part of a 'warm sales lead' and went through one of 20 scenarios.

Its conclusions were not encouraging. "Many companies lack the ability to present the customer with a convincing value proposition. ... Even though the industry is more fiercely competitive than ever, performance in the needs discovery process (uncovering the customer's broad and specific needs) has decreased in the last 12 months, impacting the industry's ability to prospects into customers."

It ranked the top three telcos as being Vodafone with "an industry-leading score of 58.3 percent, due to sustained efforts in establishing which features the customer is interested in," followed by iiNet with 56.2 percent and Virgin with 55.8 percent. Global Reviews unfortunately did not publish Optus' and Telstra's rankings.

However it's worth noting that poor performance in "uncovering the customer's broad and specific needs" might not result in a low NPS rating - because customers don't even know what they are missing out on.

The technique clearly has its limitations - only real customers can sample the true customer experience by interacting about a current service, but it does show that there is a lot more to delivering a good customer experience than getting a good NPS result.

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