Automated customer service can work for or against you. Here's how to do it right

Customers. They make the business world--virtual or not--go round. The challenge for the virtual company is to use its technology to bind customers more closely to it, rather than drive them directly to a competitor's doorstep. Nowhere is it more important to get technology right than in the area of customer service. Unfortunately, many companies make the wrong customer-service decisions, usually because they become infatuated with gee-whiz technologies.

Two technologies are often responsible for alienating customers: automated telephone attendants, also known as automated call directors (ACDs), and computerized databases. It's not the technologies themselves, of course, but the way they're used that causes the problems. Taking your customers' needs and expectations into consideration before you set up your systems can make the difference between meeting your goals and wreaking havoc.

The Awful Automated Attendant
The telephone, a cornerstone of any virtual company's general strategy, can be key to producing great customer service, especially with some of the new ACD technology available to businesses of all sizes. Call directors make sure that your customers' calls reach you or your staff members, regardless of where you or they happen to be. But there are few technologies that can produce a worse customer experience when misused.

Has this ever happened to you? You're calling to get some information so you can place an order, and you get an automated attendant with a really long initial menu. You select an option, only to be given a second, equally long list of options. Then you get a third menu, and a fourth, and a fifth, and finally, just as you're losing patience, the promise that a customer-service operator will be on the phone shortly. "At last," you think. Suddenly, there's a loud click, and you get a busy signal or, worse yet, a dial tone.

It's a chain of events that, unfortunately, happens all too often. I made a call last month for which I went through eight levels of menus and waited more than five minutes--only to be put on hold until a customer-service representative was available. I don't know what you'd do in that situation, but I hung up and called the company's competitor.

So how do you determine whether your customer-service procedures use or abuse the telephone? One way is to become your own customer, to do business with your company the way your customers do--via phone. Don't rely solely on third-party monitoring to evaluate the quality of your customer service. Call your customer-service numbers yourself and see what happens. If you're afraid someone will recognize your voice, have a friend make the call, but listen in on the entire interaction.

Becoming a customer puts you in a different mind-set--the one your customers are in when they spend the money that ultimately pays your salary. Monitoring your company's customer service, especially when you're using an ACD, doesn't tell you how your customers feel once they finally get in touch with a human. By becoming a customer, you can tell pretty easily that the ACD menu is too complex or too deep, or that your customers are kept waiting too long.

Another way to improve customer service is to make sure that senior managers understand your customer-service systems and standards and know whether those standards are being met. To get a handle on things, they should experience the company's customer service at the lowest acceptable point. For example, if your standards allow customers to be put on hold for as long as 10 minutes, have your managers experience a 10-minute hold. My bet is that when they've translated a level of service that looks good on paper into the reality of a 10-minute wait, standards are going to tighten. Also give managers the opportunity to staff your customer-service lines. Let them listen to your customers' issues firsthand and become familiar with the obstacles your front-line employees face in meeting your customers' expectations.

As for reviewing standards: Make sure your managers receive weekly or, better yet, daily reports on customer-service performance. Your call-director system should be able to create performance reports for you automatically, though you may have to massage the data. Keep the reports simple--you don't want a core dump from voluminous PBX data--one page maximum. Better yet, make them four or five lines. Track only key parameters: How long does it take callers to get to a human? What percentage of callers abandon their call before they speak with a rep? How many times are callers transferred before someone can actually handle their problem? What percentage of callers have their problem resolved, and in what time frame?

When problems with the way you handle customers come up, don't accuse your staff members or be heavy-handed with them. Use the opportunity to brainstorm with them about ways to improve customer service. You might end up restructuring your call-director menus to make them easier to navigate, add more staff to reduce customer waiting time, or take some other action that will only become obvious once you examine your own data.

At this point, you're probably wondering whether ACD technology is cost-effective. Well-implemented ACDs can be worth their weight in gold because they make a virtual company appear as if everyone is under one roof. For example, a caller in Houston has no idea that the technician she's speaking to is in Salt Lake City on a line that taps into a database at headquarters in Jacksonville. Just two simple tricks can turn problems with ACDs into benefits: Have the system tell customers how long they're going to have to wait. ("You are third in line and should be helped within three minutes.") This lets customers make informed decisions about whether to stay on the line. And let customers choose a priority for the call. ("Bob is out of the office right now. If this is an emergency, please press 1, and you'll be connected to his cellular phone; otherwise, press 2 for his voice mail.") This can eliminate the feeling of helplessness that often overwhelms the recipients of automated instructions.

The Contrary Computer Database
Another customer-service tool that's critical to a virtual operation is the computerized database. Computerized databases give technicians in any part of the country the information they need to respond to customers' problems. But like ACD systems, they can be abused. We all have our horror stories. Here's mine.

Several months ago, I tried to buy a replacement part for a chain saw from a major national retailer. The retailer had created a virtual service department, and the only help the clerks in the store could provide was to hand me a phone at the register and tell me to call their toll-free service number. The person at the other end handled parts for everything from refrigerators to table saws, so she wasn't very knowledgeable about the part I needed, but eventually we did zero in on the right piece. That's when the nightmare started.

When she got the shipping information from me, the telephone rep informed me that UPS doesn't ship to my zip code. Because UPS is at my door at least once--and sometimes twice--a day, that came as a big shock. I informed the rep of the error and asked her to override the field and force in the correct information. She told me she couldn't, the software wouldn't let her. The shipment would have to go parcel post, she said, which could take as long as six weeks. I needed the part ASAP, so I asked if there was a comment field in which she could indicate to the person who would actually do the shipping that it was OK to ship it via UPS. Again, the software didn't have any flexibility. So I agreed to let her put the part on a slow boat, hung up the phone, and left the store with a very bad taste in my mouth.

Computers are, by definition, rigid. Humans crave flexibility. It's essential when creating a computerized customer-service system to make it flexible enough to get the job done. Two important features of any customer-service system are the ability to override data-entry fields and a comment field for entering customers' (or reps') instructions, questions, problems, and complaints. Being able to mold a system to meet customers' needs is one of the ways you service your customers well.

Second to the rigidity problem is the out-of-stock problem. Have you ever called a company to see if it has a certain product, been told that the product is in stock, and then driven across town to purchase it, only to find that what the computer reported was wrong? I don't know about you, but this really frustrates me, especially when the clerk says, "Well, that computer is never right about stock levels." How do you feel about going back to that store again?

It's critical to have accurate inventory processes so that your base-level inventory is correct and then to make sure that database stays in sync with reality. Again, to test how well your computerized databases meet your customers' needs, come into your company as a customer. See how flexible your systems are under nonstandard conditions and check how accurate your on-line inventory is.

This is not to say that all computerized databases are bad. They can have excellent features. One standout is the contact record--a computer record that stores information about a customer's interaction with the company. The contact record acts as a repository for a free-format narrative explanation of the customer's problem and needs. When well set up, it allows each representative who interacts with the customer--from wherever in the world he or she works--to quickly understand the problem and what's been done so far. It also means the customer doesn't have to waste time repeating the problem to one person after another.

I'm all for computerized databases and, to a lesser degree, automated call directors for the virtual company. But only when they're driven by this objective: to develop a close and profitable relationship with customers. That means evaluating the technology with the customer in mind, not in a vacuum. And generally, the best way to get inside your customers' heads is, for a time, to become a customer yourself.

William R. Pape is cofounder of VeriFone Inc., with headquarters in Redwood City, Calif. He was VeriFone's first chief information officer.