As service providers consider the possibilities of a two-sided business model where they become "enablers" to value-chain partners as well as bit pipes over which voice, data and multimedia services travel, they must consider the smartest way to pursue transformation in preparation for telco 2.0 and Web 2.0 services.
They must pay attention to the number of technology-oriented transformations that have screeched to a halt because "customer experience" had not been factored in. Too often, customers ended up overwhelmed or disenchanted, and customer care and CRM systems over burdened.
Competing and partnering with the likes of Google, Yahoo or Amazon requires that service providers think like "retailers" so they can control customer experience in the same way Wal-Mart, Toyota or Apple does. As just one rudiment of a growing value chain, telcos will have to be able to re-use and reassemble third-party offerings to create bundles that blend prepaid, real-time capabilities with hybrid and postpaid capabilities.
"As things get commoditized, it comes down to choice and control," says Gabriel Matsliach, general manager for billing and active customer management at Comverse. "As operators' financial exposure goes up, they need to find interesting ways to deliver third-party services to customers in meaningful bundles while simultaneously managing risk to recoup costs, such as payments to third parties.
To appeal to their audiences, service providers need an end-to-end view starting from pre-service aspects of the customer lifecycle (before a person becomes a customer), all the way through to procurement, consumption, assurance, customer care and billing as well as beyond to the point of recommendation of the service to other people (i.e, through social networks). Only with a holistic approach can service providers convert from reactive to proactive care, promotions, personalization and customization for customers.
As the definition between customer and end-user is made clear, there are three lifecycles to manage, according to Matsliach. First, is the immediate - the moment of opportunity where customer is encouraged to continue with service with promotion or special offer that helps customer feel he's gained something.
The second is the current-state, where the operator offers services tailored to the customer's current situation (i.e., single and relying mostly on mobile phone so giving choice and control most valuable to him). The last is the longer-term lifecycle, where service providers leverage longevity of relationship by proactively recognizing changes in customer's life (i.e., marriage and move to new home, so offer triple play or family plan).With services growing in sophistication, the perception of quality by different audiences can be vastly different, especially as the distinction between "customer" and "end-user" grows. The difference between the two has implications for operators striving to appeal to both the paying customer (perhaps the parent or company) and the end-user (teenager or employee).
Overall customer experience is not just the customer perception of the quality with which a service was delivered, but the overall experience the customer has with the service provider as a company. That experience is based on the level of customer satisfaction with a product and service portfolio, as well as service availability, activation time, overall service availability, quality of customer support, ease of understanding the service, as well as the billing and payment mechanisms.
Operators should have a sense of urgency in minimizing the gaps among the customer-experience levels expected and the levels actually experienced by the customer and end-user, as today negative feedback can be spread virally through social networking, which can greatly impact the success of a service offering. For example, a teen dissatisfied with a service may not be a customer from a billing point of view, yet he can have tremendous impact on a service through the dissemination of opinions.
From performance to behavioral focus
Managing the customer experience has traditionally focused on metrics that pertain to service quality from a network-centric, "in-service" point of view. In the POTS days, it was time-to-dial tone or call-block rates that mattered, and with data services, things like jitter and latency came to the fore. But swelling interest in social networking and multi-service offerings will invite new, customer-savvy and popular competitors into the mix - companies that better understand people's feelings, aspirations, desires, perceptions of quality, perception of brand and subsequent loyalty.
If telcos continue to look only at performance and service quality metrics, they will fail to be as "customer-oriented" as their competitors and partners. Metrics going forward have to have a "human element" to them; after all, it is people not networks that increasingly drive services.
"Service providers have to start tracking the real-time quality of delivered services in customer-understandable language, not megabytes-per-second or DPIs," says Alex Zhdankin, primary liaison between TM Forum and DMTF, and co-chair of DMTF's Telecommunication workgroup. Zhdankin also served as the Harmony Catalyst project co-lead, and he is participating in the Managing Customer Experience Program at the TM Forum.
He recommends service providers deploy components that track issues most likely to affect QoS so they can improve quality of experience as well as the level of technical and service support (i.e, help desk and customer support).
"For example, upstream and downstream bandwidth, HDTV quality in DPIs, latency and response times for websites and portals are important metrics, but they are not translated into customer-understandable terms," says Zhdankin.
For that reason, product descriptions and SLAs are often written in terms that do not clearly define "value" to normal, everyday people. That fact often leads to customer confusion and disappointment, not to mention overspending. It also leads to costly transport and data center costs as service providers race to stave off churn for lack of visibility into what impacted the customer experience.
"There are three vectors of positive experience: value, transparency and simplicity. If you don't have those three, you cannot create a positive customer experience for any service," says Redknee CTO Bohdan Zabawskyj.
"Value is perceptual. For example, you can download MP3s and videos for free online using Bit Torrent and so forth, yet Apple is making a killing by packaging what is a commodity into something that is easy to use, easy to understand and available at a good price point," notes Zabawskyj.
"As for transparency, subscribers just want visibility into what they are paying for."
For usability, Zabawskyj says any service should be intuitive and not convoluted in any way. "The attrition rate per step in a mobile context, for example, is in the order of 10 to 15% per step. You can eliminate a huge portion of an addressable market if you don't think through the frustration people feel if they have to go through multiple steps."
It may seems straightforward that service providers would perform statistical analysis of customer feedback and complaints around those three factors, but most CRM and customer care systems lack the type of analysis necessary to accomplish that type of analysis and understanding. Though most support systems vendors offer mechanisms for tracking complaints and service outages, few possess standard metrics for defining quality-of-customer experience and for defining what is important for service providers to calculate and report, such as feedback relating to service quality, level of technical support, and helpfulness of the personnel at the retail points.
"Although lots of service providers have performance measures, you'd be shocked at how few actually can go back through and give the subscriber a call if they've received negative feedback," notes Eric Carrasquilla, Amdocs' GM for customer management product business unit.
He says the necessary elements of next-gen customer experience management, include customer segmentation and profiling to determine customers' preferred channels and preferences. "You also need tools for 'next best action' such as predictive/real time analytics, personalization, and scripting so that service providers can apply specific treatments to subscribers at the point of interaction," adds Carrasquilla.
Though some operational, performance and customer KPIs are in place, the link is weak between the analysts on the back-end and the visibility and translation of the metrics to those on the front lines. According to Carrasquilla, service providers need to gain real-time insight through in-the-moment metrics that answer questions, such as: Was the problem solved in the time promised? Does the suggested solution actually work? Did I feel someone listened and understood enough that I could feel confident the problem was actually going to be fixed?
There are also fledgling methodologies for mapping customer experience and perception-oriented metrics to traditional lower-level performance indicators.
These more sophisticated metrics may help service providers estimate service delivery quality in real-time, and in the way customers perceive service quality. Then, service providers can adjust resource allocation accordingly and economically to match the delivered quality to customer expectations.
Understanding the experience
A survey conducted by Yankee Group and Amdocs to gauge and better understand the progress service providers have made to become more customer focused demonstrated some surprising and enlightening results. The main conclusions were:
- Service providers are investing to improve the customer experience, but they lack clarity on how to define and measure it - 61% of service providers currently have initiatives underway to make the customer experience more personalized, but ironically nearly half felt their companies don't have a clear understanding of what that customer experience needs to deliver.
- Service providers recognize significant system obstacles to delivering on the customer experience and are prioritizing investments to address them.
- Many service providers lack the organizational focus to align their business processes to positively impact the customer experience (70% of respondents indicated this).