Cost center to opportunity center

Posted by Kevin Hall

The question remains: what will the cost of not making the most of every customer opportunity, learning how to deal with the customer on their terms and not on your service modality.

In the past, we used to structure our IT budget based on what was required to keep the business going, without having to spend too much to keep the IT lights on.

The reality is this mindset of looking at your IT strategy as a cost only solution.

When we choose to look at costs and not to take the whole strategy of the company into consideration, our meetings in the boardroom never result in actions on the coalface – this then impacts on longevity and the long-term sustainability of the profit margin.

Company strategies need to include the voice of the customer or client. Is their voice in the boardroom just linked to spreadsheets and dashboards or do they have an ability to communicate their needs to the people that matter, in a way that enhances the offering to market?

When we look at the IT budget as an opportunity to innovate instead of the budget items that need careful cost cutting and pruning, the possibility for growth starts to increase drastically.

Let’s look at how the processes in the company are combined and designed to form a holistic ability to create an experience your customer cannot get anywhere else.

We have all tried in the past to submit an insurance claim for something that broke, or were stolen, or just something weird happened that we needed to explain in very lengthy documentation.

Let’s look at the typical claim process:

Send in all your policy details and state the possession you are claiming for.

Get feedback demanding some paperwork.

Hand in the correct paper work – with some missing bits.

Get feedback that bits of details have gone missing.

Hand in the missing pieces of the puzzle.

Get somebody to assess the damage, and verify the claim.

Get feedback from the insurance company.

Learn that the claim still needs to be processed by another department due to some discrepancy.

Wait two weeks to learn that the make, or model number you claimed for was not 100% correct.

Figure out why the model number would be important to the replacement.

Endless backwards and forwards sending, phoning, following up.

This is just a casual example of a typical customer journey, but the reality is that most of us, in some shape or form, have suffered at the hands of many touch points in many companies trying to resolve basic issues.

How could this be changed going forward, without needing to throw the kitchen sink at the problem?

If these problems were easy to solve, they would have been solved already.

The fact is the complexity of the process, the many levels of data, and the many steps of verification and authorisation cause simple processes to have bottlenecks at each stage of completion, due to all the factors involved.

A few simple steps could be followed to access best practice business principles and fix some of the process issues. One could then look at all the other IT systems and decide on a strategy to transform this headache into an opportunity to automate the process, with some clever backend, mainframe and data base interrogation.

The opportunity to solve these problems could provide your company with solutions, and as the customer journey improves, the result will be word of mouth referrals. These referrals will drive profit margins much more effectively than marketing budget spent on advertising, which is hard to quantify in terms of ROI.

By simply making the customer feel like you care, and creating a journey that is simple, user friendly and easy to follow, the results will speak for themselves.

Current technical advances in artificial intelligence engines, interrogating the data and providing more insight might enable you to predict actions of customers. It can also help you wrap your offering into a better, more attractive proposition at the right time and place.

In reality, these solutions are not cost effective yet, and the quality of the data warehouse and collection points of data needs to be strategic in nature.

Simply having more data about your client, or consumer behaviour does not mean the situation is improving on the customer end. The customer journey needs to be shaped, the processes need to be mapped correctly, not just based on process engines, but considered with practical understanding of the business.

Most of the ISO process focus has just been mapping and documentation of processes, and then possibly making some changes. However, the inherent flaw in this has been the human interaction.

By automating key processes, and then making the bottlenecks visible in real time, managers and C-suite executives are able to change products, tweak specials, and understand in real time, what the customer is buying, why they are buying, or in other instances, where the operational constraints might be for future growth.

Automating mundane tasks reduces the cost of service but also provides a predictable level of service based on the automation architecture.

Looking for quick wins in the process and removing these mindless tasks from people will then enable those same skilled people to invest their time in the customer journey. This adds a personal touch to every interaction, which answers the expectation of the client.

The architecture of innovation for the customer is often more simple, needs a common sense approach with some basic understanding that the customer wants to be asked the right questions, respond to those questions, and then get the service they asked for, based on the current service level they are paying for.

We all understand that customers are paying less, wanting and demanding more, and then asking for the more in a quick user friendly way. Providing solutions to this increasingly higher expectation mountain, innovation, and automation, will be the opportunity - not features and functions.

In the past, scarce resources we tried to protect as computing power, processing speed, and storage space, we were concerned how much each user was consuming as the resources on this end was finite.

This has changed, with the advent of cloud, all these resources can we consumed on a pay per use, always on basis, what has become scarce is the skills to fully make use of the technology, and all the systems which are available.

Let’s define the opportunity, look at the opportunity cost based on possible returns, understand that the automation process could free up much needed skilled labour to deal with the customer in a personal way, which then enhances the business offering.

In every era of progress, from the age of industry, man has found ways to make machines that do the hard labour, while the human capital is focused on the true creative process.