Therefore Strategic Technology Services

Monday, 29 July 2013

Moments of Reality … and the development of Strategy

It is sobering to note that every time a Customer interacts with your business, they are provided with an opportunity to evaluate your company and pass judgement. Over the course of repeated interactions, Customers are inclined to form an opinion of your company, either positive or negative. The longer the time frame, the more interactions and the more entrenched these opinions will be. If a negative opinion is sustained for long enough, Customers are inclined to jump ship and move their business to your competitors.

Further, should a negative opinion be formed, Customers will engage in negative “Word of Mouth”, which will slowly erode your Customer base and profitability. Alternatively, should a positive opinion take root, you are likely to be on the receiving end of positive “Word of Mouth” publicity.

In keeping with recent articles relating to the development of Strategy, I have decided to provide a quick overview of a powerful strategic tool … Moments of Reality. The Moments of Reality methodology is ideally suited to guide the development of a tactical level Customer Services strategy.

Touch Points

The first step in doing a Moments of Reality review is to identify your Customer touch points.

A touch point is a point at which you interact with a Customer, even if it’s just in a small way. Touch points are in effect the points at which your Customers have an opportunity to form an opinion. If all of your touch points reflect positively, your Customers will develop a positive impression of your business and you are likely to hold onto them for longer, thereby enjoying a more profitable relationship. Holding onto the Customers that you have is a key ingredient in growing your Customer base … more to follow in a future article.

Provided below are some example touch points.
  1. A Customer visits your website
  2. A Customer visits your Facebook, Twitter or LinkedIn page
  3. A new Customer wants to open an account
  4. A Customer calls into your switchboard
  5. A Customer phones in to order goods
  6. A Customer takes delivery of your goods
  7. A Customer unpacks your goods
  8. A Customer signs your delivery note
  9. A Customer receives your invoice
  10. A Customer receives your statement
  11. A Customer phones in with a query
  12. A Customer has a problem with an invoice or a statement
  13. A Customer has quality problems with your goods
  14. A Customer requires technical detail regarding your goods
  15. A Sales Representative calls on a Customer
  16. A Customer calls in for a quotation
  17. A Customer wants to close an account
It is critical to dig deep when drafting a list of touch points. Even the smallest touch point provides an opportunity to form an opinion … so items should never be written off as trivial. Key to success is pulling together the right people to help in touch point identification. Typically, you would draw in your Customer Services Team, your Sales Team, senior staff, perhaps the Executive and their direct reports, as well as any “Thought Leaders” that exist within your business.

When identifying touch points, it is generally useful to consider the Customer Life Cycle. Customers go through a journey from the point in time that they initially start doing business with you through to the point in time that they leave you. Your objective is to make sure that the touch points identified cover each phase in the Customer life cycle. Provided below is a high level view of the Customer life cycle.
  1. Acquire – It is during this phase that a Customer is on-boarded. Common touch points include the Customer applying for an account, the Customer requesting a quotation, the communication of your Rules of Engagement to the Customer and the like. More to follow regarding Rules of Engagement in a subsequent article.
  2. Serve – It is during this phase that the needs of the Customer are serviced, either by the provision of goods or services. Common touch points are the receipt of goods, the receipt of invoices and statements, the processing of orders, the resolution of queries, the launch of new products, the extension of product ranges and the like.
  3. Grow – It is during this phase that you attempt to up-sell / cross-sell to the Customer to add additional value to the relationship and derive incremental revenue. Common touch points include Sales Representative visits, marketing campaigns, the provision of quotations and the like.
  4. Retain – It is during this phase that a Customer either becomes an advocate of your company, in which case you can expect to retain them, or becomes a detractor, in which case you will more than likely see them churn. Key to this phase is the provision of after sales service, the continual emphasis on adding value as well as relationship management.

Evaluating Performance

Once you have identified your touch points, it is imperative that you optimize them to ensure that your Customers will judge each touch point interaction positively.

By way of an example, let’s assume that the receipt of an invoice document is one of your key touch points. Do your Customers like your invoice? Is it easily read? Does it look professional? Does it provide the detail that they require? Is it easily processed by the Customer’s Accounts Department?

Perhaps your Customers phone in to place orders. Is the call answered within a reasonable time frame? Do you provide an order by email or fax service? Do your Customers want to fax or email orders? Are you able to give your Customers an order number while they are the phone? How do you provide Customers with their order number if they fax or email their orders? Are your Call Centre Agents polite, accurate and quick? Do your Call Centre Agents have the appropriate degree of product knowledge? If the Customer can’t recall his / her Account number, how friendly is the process to establish their authenticity and give them their account number? Are the operating hours of your Call Centre suited to the operating hours of your Customers? Is the voice quality of the telephone call acceptable to your Customer?

In short, all touch point failings are to be identified, a correction plan is developed and then implemented - it’s as simple as that. A Moments of Reality exercise results in a tactical / task level plan, so all that remains is for it to be managed to a close. The Therefore StratIQ™ application allows for the management of strategically focused tasks to a close in a controlled and transparent manner and may be worthy of evaluation, particularly if you operate in an environment of high complexity.

Ask your Customers

It stands to reason that your Customers themselves are best equipped to guide the “Evaluating Performance” step outlined above. If your budget allows, it is ideal that you interact directly with your Customers to get their input. A couple of options available for deriving Customer feedback follow:
  1. Sales Representatives / Customer Services Management personally call on key Customers and interview them regarding their touch point needs. Should you decide to go this route, it is advised that you clearly brief the Team that will be interacting with your Customers so that they have clarity as to what the objective of the exercise is and what is expected of them. Remember that Customer visits are touch points … make sure that they leave a positive impression.
  2. Surveys can be done, preferably by an independent third party. Your identified touch points should be used as a starting point for drafting the survey questionnaire. Independently run surveys provide an ideal opportunity to benchmark your performance relative to your competitors. Areas where you fall far short of your competitors would logically be worthy of prioritizing.
  3. Mystery shopping is an extremely useful tool. When last did you phone into your Call Centre? How long did the call take to be answered? For those in the retail trade, mystery shopping is critical to ensuring that service standards are both appropriately pitched and consistently met.
  4. Customer queries provide a low cost opportunity for evaluating touch point failures. To effectively use queries to drive the identification of touch point failure, it is critical that they are categorized so that error prone touch points can be identified. The Therefore Quantum® BPMS is worth evaluating as it allows for queries to be resolved and then reported on with a view to identifying areas where your performance tends to fall short of Customer expectations.
  5. Establish a Customer Forum which meets periodically and use the opportunity to take feedback regarding their requirements. It is advised that you only establish a Customer Forum at the point in time that you feel that you have pretty much got your touch points in order. Further, ensure that you are truly committed to listening to your Customers if you decide to establish a Customer Forum … as non-delivery will simply translate into a failed Moment of Reality!
  6. Should you be servicing the mass / consumer market, Focus Groups are an invaluable tool for identifying touch points and ensuring that your business is correctly managing them. It is advised that focus groups be run by independent / professional third parties so that they deliver their maximum value.

What do Customers want?

When aligning your touch points to the needs of the Customer, there are a number of questions that need to be answered in the affirmative as a sanity check before you implement your touch point refinements. Details follow:
  1. Have I simplified the process as much as possible?
  2. Have I cut out as much red tape as possible?
  3. Is the Customer being kept in the loop?
  4. Will it leave a positive impression?
  5. Am I minimizing Customer inconvenience?
  6. Am I maximizing Customer value?
  7. Is it Customer centric?
  8. Is this what the Customer expects from the touch point?
  9. Will the Customer intuitively understand the process?
In short, you want to ensure that you focus your attention on making it easy for Customers to do business with you.

It’s not a once off exercise

The competitive environment is continually shifting, as are the needs of your Customers. It is imperative that one performs a regular review of the effectiveness of your touch points to ensure that you continue to delight your Customers. It is proposed that touch points be in a state of continual refinement and that a formal review be done annually.

The “Black Box” issue

A Moments of Reality evaluation only focuses on Customer centric inputs and outputs. It is important to note that a Moments of Reality exercise is a “black box” affair and is not in any way cognoscente of the underlying processes required to achieve a positive outcome. It stands to reason that the corrective action taken when fine tuning your touch points must be cognoscente of process efficiency.

It’s a time game

It takes time for people to change their impressions. If you historically had Moments of Reality that were poorly aligned to the needs of your Customer, you can expect your Customer’s mind-set to shift far more slowly than you would hope for. Remember that the negative impression that your Customers have, was reinforced over a long period of time.
A Moments of Reality Strategy requires a long term vision … give it time, the end point is worth the application of patience. The sooner you start … the sooner you finish.


As a closing thought, you can do a Moments of Reality exercise on any Stakeholder. This article has centred on the Customer, given their importance as the primary Stakeholder. Ideally, you should do a Moments of Reality exercise for all of your Stakeholders. Other Stakeholders that may be worthy of such treatment are Staff, Shareholders, the broader community and the Government.

As a further thought, a Moment of Reality exercise can also unlock value within your organisation. For example, what are the touch points that are in play when your staff members interact with internal departments such as Human Resources or Information Technology? Are these internal touch points experienced in a positive or negative manner? Departments such as Information Technology and Human Resources are often seen as “land locked” in that they don’t directly interact with the external Customer. The reality stands that they are critical in the delivery of service to the Customer, albeit indirectly. Optimizing touch points between your departments can positively impact on the overall efficiency of your organization.

Saturday, 13 July 2013

Strategy planning … discovering the Tactical

In a previous article mention was made of the importance of ensuring that your Strategy is translated into a tactical plan … something that your team can buy into. Developing a tactical plan is not as easy as it looks. The key question is, “How do you avoid the plan becoming a meaningless list of uneven tasks that are not fine-tuned to add real value?”

Let’s consider the process. You have created a great Strategy. At the high level you know that you are on the right path for making a huge difference to your business’s performance. The next step you followed was talking to the market and taking a few pointers. So far, things are looking great. Now you need to build the tactical plan … but where do you start?

Deriving a tactical plan is hard work. It requires strategic conversation between the right people … and it generally takes more time than you were expecting. The first trick is to select the Team that you want to draw into the debate. Typically, you would draw in your senior staff, perhaps the Executive and their direct reports. Drafting the Executive and their direct reports into the process makes sense, as it will be them that are accountable for the execution of the plan.

I would generally suggest that you also set about identifying “Thought Leaders” that exist within your business and drawing them into the process too. Thought Leaders can exist at any level of the organization and are probably your future leaders. Fundamentally, Thought Leaders are staff that demonstrate a surprising degree of business maturity, have an exceptional understanding of the market that you serve as well as the dynamics that exist within the organization. Most importantly, Thought Leaders have a bent to strategic conversation. Chances are, you have already identified them and have plans to fast-track their progress through the ranks.

To ensure that your Strategy gets unpacked from all functional points of view, it is critical that the Team that you assemble is cross functional. Each Team member must be allowed to contribute to the discussion, both as it relates to his or her function and as it relates to the functions of others.

Now that you have assembled your cross functional Team, the next step is to unpack each of your Strategies one at a time and determine each tactical item that needs to be undertaken to allow your Strategy to become a reality. The trick is to move quickly and to allow for all contributions to be put forward and debated, irrespective of their relative strength.

Once you have all of the proposed tactical items listed, the next step is to choose the ones that you wish to move forward with. Consider the following image.

The process to follow when sifting through proposed tactical items is a relatively simple one. As indicated by the image above, work with your Team to identify the relative “Ease of Implementation” (Difficult or Easy) and “Impact” (High or Low) of each item. You may want to introduce a basic spread sheet based model to allow for the classification to be done a little more objectively, the design of which I will leave up to you.

Some thoughts on the four quadrants follow.
  1. Bottom Left – These items are not easily done and carry little impact. Carefully review all items that fall into the bottom left hand quadrant. As a general rule, consider dropping them from your plan. You may well find that there are quite a few items in this quadrant. Excluding them will make the implementation of your strategy easier and reduce exposure to cost without materially taking away from the impact of your Strategy.
  2. Top Right - These items should typically be prioritized, as they are easy to do and will have a large impact. It is worth bearing in mind that, given the ease of their implementation, your competitors will catch up with you rapidly. It is therefore critical that you plan to derive benefit from these items in the short term prior to your competitors entering into the fray.
  3. Bottom Right - These items build capacity, which is critical for the medium to long term well being of your business. I have often seen business’ under invest in the infrastructural aspects of their Strategic planning, presumably because it doesn't generate immediate gratification. Should this attitude persist into the medium term, the available capacity will be sold into and the business will soon find itself in a position where it has insufficient capacity to support future growth. Turnaround Strategies often find a lot of traction in the grey quadrant.
  4. Top Left – This is where the true magic sits. "Strategic Wins" are typically hard to do, which makes it difficult for your competitors to emulate you. Given that they are hard to emulate, they inevitably provide you with a Sustainable Competitive Advantage.