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"Improvement" impacts
An "improvement" in one department caused that costs to increase in other departments and customer needs to be missed
? They couldn?t cope with the volume of calls, meaning potential sales calls were lost.
? As the call centres had too many calls to deal with they couldn?t make the retention calls to existing customers.
?
The operations team were also inundated with the
too much volume in a normal time and so they struggled to get the
volume turned
around, overtime was employed, mistakes were made and packs sent out in
the wrong order. causing customers to cancel their products before ever
using them.
So the cost savings in one department caused lost sales elsewhere and increased costs in others.
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An "improvement" from one department that again failed to meet customer needs, causing raised costs and eventually ended up back on the originators desk as a new problem to solve
Take the marketing CRM system that had identified that those with more
than one product were more "loyal". Thus the current account sales team
were incentivised to
sell more than one product per call and so spent time ?selling? savings
accounts to everyone, even if they had no use for them;
? Time was spent by the sales team "selling" accounts to everyone. Accounts that weren?t going to be used.
? Time was spent in operations putting together packs (atm cards, cheque books, welcome letters etc) for accounts that weren?t going to be used.
? When marketing analysed the usage rate of these products they found they were lower than expected and so started to add more product features and offer incentives to non-users to use the product.
An "improvement" in one team led to wasted efforts in others and ultimately back into the first department to resolve.
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An "improvement target" which failed to meet customer needs but raised costs elsewhere
Take the service team who were targeted to handle 80% of calls in 20 seconds (customers actually wanted their issues resolved in the first call and would wait for the call to be answered. resolution). This drove the service team to answer calls quickly regardless of whether they could resolve the issues causing customers to be rushed through, passed onto other operators, call-backs promised or given other phone numbers to call. This lack of customer service resulted in in customer dissatisfaction and defections! The marketing team saw these defections and decided on:
? further activities (mailing, calling etc) to promote the product characteristics
? incentives to try and keep customers.
Extra cost were incurred, which created little value to the customers and failed to address what the customers wanted.
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?2009 ResQ Management Resources Ltd. Reg No. 558 1973 Reg Office: 25 East Parade, York, YO31 7YB.