Standard Customer Satisfaction Surveys Don’t Make the Grade in Improving Service Levels

Customer surveys are everywhere -- at the store, on the phone, the Web -- and still customer service horror stories flourish. With all the solicitation for customers’ opinions, companies should wonder why there isn’t an increase in customer satisfaction and customer loyalty.

According to a new white paper by Impact Achievement Group, “Asking the Right Questions: How to Get ROI on Customer Surveys,” the data gathering is not contributing to a better understanding of customers. In part, there are fundamental flaws in common attempts to measure customer satisfaction.

Surveying the wrong customers:
Companies should consider how many customers have the time or are bored enough to provide time-consuming answers for the survey company. Forget random sampling--companies need to survey their best customers, not those with an axe to grind. Notably, it is more common to survey the wrong customer in the business-to-business market (decision makers versus users).

No actionable feedback:
Frontline employees are adverse to long surveys—they’re not paid enough nor have the time. For employees to improve customers’ experience they need to survey frequent customers—who spend enough money—to elicit appropriate solutions from management.

A disguised marketing initiative:
Many customer satisfaction surveys are nothing more than an attempt to gain data to help better market and advertise products and services. Years of this practice discourages customers from participating even in legitimate surveys, further limiting survey reliability.

Scores don’t equal improved economics:
Research has consistently shown an unpredictable link between satisfaction scores and profitability/growth. For example, detailed analysis of surveyed customers has shown that between 60 and 80 percent of customers who’ve turned to another supplier have rated themselves as “satisfied” or “very satisfied.”

One-size-fits-all solutions can’t meet a company’s unique needs:
Cookie-cutter surveys produces crummy data, yielding an “average” insight to customers’ attitudes. Instead, companies need custom, local research that addresses the unique customer relationship and internal business practices. Simple, anecdotal feedback is of more use to management—not to mention those on the front line.

Surveys focus on transactions—not relationships:
Customers focus on the overall experience – not individual transactions. Evaluating the quality of the relationship includes every detail of the customer’s experience combined with the emotional and branding ties the customer has. Specific, transaction-oriented questions don’t address customers’ overall company experience.

Dissatisfaction as a result of the survey itself:
Intrusive, lengthy and ambiguous surveys are frustrating. When company decision makers forget this and use outside survey companies, they avoid direct customer dissatisfaction with the survey process. Worse, they entrust responsibility for customer information to people with very little—if any—interest in representing the company’s brand positively. Lousy survey data, ignored by management, further add to customer dissatisfaction.

Manipulation destroys credibility:
Tying performance marks or dollars to the scores can encourage manipulation among employees. When punished or rewarded for goals they can’t control or influence, employees instead focus on “gaming” the reward or eliminating the punishment.

“Asking the Right Questions: How to Get ROI on Customer Surveys,” can be downloaded by clicking here.

More information on the service and support industry can be found at http://www.supportindustry.com/

Spending on Governance, Risk Management, and Compliance Will Exceed $32B in 2008

AMR Research announced that companies will spend more than $32B on governance, risk management, and compliance (GRC) in 2008 -- an increase of 7.4% over 2007. Spending on Sarbanes-Oxley (SOX) compliance is expected to grow only 2% to $6.2B.

For the first time since AMR Research began conducting this study in 2003, executives have shifted their GRC budget focus to operational and enterprise risk management -- making SOX and other regulatory compliance programs a necessary “to-do,” but not a top-of-mind initiative. 31% of companies reported that better managing and mitigating risk in the business is the most influential issue driving their GRC investment in 2008.

For the last few years, GRC services numbers have been decreasing as companies streamlined compliance activities, but as risk rises in importance, companies report they want and need guidance on how to frame the risk discussion in a business context. Thus, GRC initiatives remain an intensely human effort. Two-thirds of budgets (approximately $21.5B) are earmarked for people-related expenses (services plus head count) in 2008.

More information on the Service and Support industry can be found at www.SupportIndustry.com

Business Budgets Still Cover Upgrades

A new Forrester Research report suggests that despite the uncertain U.S. economy, many enterprises are continuing to plan major software projects and purchases. Seventy-nine percent of 215 North American "business process and applications professionals" surveyed said that they intend to upgrade some or most of their core enterprise applications within three years.

Forty-nine percent of respondents plan to upgrade their enterprise resource planning (ERP) software in either 2008 or 2009, according to the report. Within the same time frame, 47 percent are set to refresh their customer relationship management (CRM) systems, and 37 percent are eyeing supply chain management (SCM) upgrades. These particular results are based on answers from 191 respondents, according to Forrester.

Seventy-six percent of respondents said hardware and data center upgrades or migrations are a "priority" or a "critical priority" during the next 12 months. Sixty-five percent said the same for developing a master data management (MDM) strategy. This activity will largely revolve around a centralized point of influence, according to the study.

Eighty-four percent of enterprises surveyed said their top IT officer was either "very influential" or has "complete authority" over technology purchasing.

"[F]irms appear to be satisfied with centralized decision-making," the study states. "However, the real organizational battle will be to reconcile major software decisions being made corporatewide as the combination of senior line-of-business execs with significant authority and budget and the software-as-a-service (SaaS) model gives license to make application decisions without IT's involvement."

Forrester touts its framework for developing a long-term packaged applications strategy. The study found that only 20 percent of respondents intended to consider a five-year applications plan during 2008.

More information on the customer service and support industry can be found at www.SupportIndustry.com

Application Delivery Architects and Engineers Should Be an IT Organization's Next Key Hires

As more organizations begin to deploy application delivery networks (ADNs) to mitigate limitations in business-critical applications, Gartner, Inc. says the emergence of ADNs creates a need for a new group of technical professionals. ADNs are required for successful deployment of modern browser-based applications and emerging Web services applications. Enterprises should recognize that designing and managing this new network overlay requires unique skills and build a team of application delivery architects and engineers. These new roles will be key to the deployment of very expensive applications and protocols.

Application delivery architects work with application development, storage, security and network architects to develop an overall approach to the delivery of each application. This team determines which optimization techniques (protocol offload, caching, application firewalls, and so on) are required and where they should be implemented.

Once the approach to application delivery has been decided, an application delivery engineer leads the operational effort. He or she configures and manages the elements of the ADN. This may involve programming application delivery controllers through scripts, developing Web application firewall rules, or working with the managed service provider to optimize the ADN service. Members of this team will often be drawn from application/server and security administration. The cross-functional nature of the application delivery engineer's job requires strong people skills as well as broad, strong technical skills.

Because ADN knowledge is in short supply, Gartner says most companies will have to develop staff in-house. Although this will require investment in training and, perhaps, pay grades higher than those of network engineers, it is a necessary investment. Application delivery architects and engineers can be key to the deployment of highly expensive business-critical applications. Gartner believes that companies which employ them will realize a very positive return on investment and could achieve strategic market advantages.

More information on the service and support industry can be found at www.SupportIndustry.com

Software Spending by Retailers in China, India, and Russia will top $1.57B in 2010

According to a recent AMR Research report, software spending by retailers in China, India, and Russia will top $1.57B in 2010 -- an increase of 45% over 2007. In addition, these retailers will increase their IT budgets an average of 25% between 2007 and 2010. Aggressive first-time spending for store technology over the next few years, especially in China, will see retailer budgets in these emerging economies far outpace those of their peers in more established countries.

According to the report, the most common business priorities for retailers in these regions included increasing their understanding of consumer demand (22% cited it as their top priority) and improving the overall shopping experience (18%) in 2007. Priorities will expand in 2010, with an increased focus on consumer-centric merchandising and the strategic software investments that support this effort.

Of the 232 retailers in emerging markets surveyed, the majority will seek alternative relationships with their technology providers over the next few years. Between 2007 and 2010, acquiring software via the traditional licensed approach will diminish by 20%. Retailers in emerging areas of the world will shift toward software-as-a-service (increasing 56%), business process outsourcing (21%), and open source (69%).

More information on the service and support industry can be found at www.SupportIndustry.com

Tech Support Salary Survey shows "dramatic upturn" in pay levels

Tech support salaries rose significantly across the board during 2007, according to the latest annual salary survey conducted by the Association of Support Professionals (ASP). The ASP's 13th annual Technical Support Salary Survey, which reflects compensation data supplied by 148 participating support organizations, found double-digit pay gains in five of the seven job categories that the survey tracks, with 8%-9% raises for two other groups.

The report shows pay levels for seven major job categories, including
senior support executives, department managers, analyst/project managers, senior support technicians, field support technicians, support technicians, and customer service reps.

The upturn in salary pay reflects several converging trends in the support and services world, the report notes. These include a tight employment market, customer pressure for higher-quality support, greater employee productivity, lower employee turnover, and less hiring of lower-paid entry- level staff.
More information on the Service and Support industry can be found at www.SupportIndustry.com

Emerging Technologies Will Marginalize IT's Role in Business Intelligence

By 2012, emerging technologies will make it easier to build and consume analytical applications lessening IT’s role in building these applications, according to Gartner, Inc.

Much of the innovation in the BI space will come from emerging technologies that will make it easier for users to build and consume their own reports and analytical applications. In particular, five technologies -- interactive visualization, in-memory analytics, search integrated with BI, software as a service (SaaS) and service-oriented architecture (SOA) -- will help drive mainstream BI adoption.

Interactive visualization will be quickly accepted during the next two years as a common front end to analytical application, driven by the ubiquity of rich Internet applications. This technology trend will make reports and analytic applications easier and more fun to use. With its attractive display, it should be more widely adopted by users who aren't accustomed to the grid style of analysis and reporting offered by relational databases and spreadsheets. By definition, interactive visualization enables users to perform typical BI tasks, such as data filters, drill down and pivots, with little training by interacting with the visual, such as clicking on a pie wedge, or circling the dots on a scatter plot.

Because BI explores huge amounts of data, it has traditionally relied on IT to build aggregate and summary tables to optimize performance on disc-based data storage. This requirement to build a performance layer impeded self-service BI. Falling memory prices and the prevalence of 64-bit computing is making in memory analytics a more attractive alternative. With this approach, business users no longer require IT to build a performance layer.

Many BI systems hold thousands of reports in a complex hierarchical structure. Users find it easier to find reports with search technologies backed by sophisticated relevance rankings instead of a folder navigation structure. Search will make it easier for users to find data for ad hoc queries although it will not help with related tasks such as formatting reports consistently.

Smaller companies that lack the base of investments in BI systems will increasingly turn to service companies to deliver services that integrate, analyze and report on data from numerous systems. Wider adoption of SaaS business models will make analytical applications more widely used, particularly among midsize companies. However, even large companies with full BI and data warehouse teams will embrace the SaaS model for some aspects of BI. The best example today is in Web site analytics, where business users — typically in marketing — can access very sophisticated reports and analytic applications of Web site activity with virtually no need for IT by leveraging a software as a service provider. The increasing trend toward business process outsourcing and cloud computing will only accelerate this trend, enabling the delivery of BI-related information and analysis for particular subject area domains via the SaaS model.

More information on the Information Technology industry can be found at www.SupportIndustry.com