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Management firms have data but are starved of knowledge

Simon Caulkin

You phone a call centre to complain about a bill — but you still get a threatening reminder through the post a week later.

AS ANYONE trying to navigate London's dug-up streets will testify, the British capital's water mains are in a bad way. Pipes are cracked, blocked, too narrow or in the wrong place. Joints and valves are worn and pumping stations out of date. The result: 20 to 30 per cent of the water supply goes to waste in bursts, or simply seeps away underground.

Something similar happens to customer information in today's service organisations. In a report called "Expectation vs. Experience: How Wide the Rift?" database-software specialist Data Vantage shows that, of the vast quantities of information expensively pumped through corporate pipes, much gets diverted, dammed or just trickles through the cracks. What does get through is often contaminated, diluted, or otherwise unusable.

The direct outcome is not only huge amounts of costly waste and further treatment. Companies are drowning in data and starved of knowledge, while customers are passed from pillar to post as data packets. Despite hours spent hanging on the phone or online, customers and companies are just not connecting. They shout past each other until angry customers hang up and go somewhere else — and, because of the information gaps, organisations aren't learning. As Data Vantage chairman John Orsmond puts it, they are locked into a state of "arrested development," putting the blame on consumers' brand promiscuity rather than their inability to meet the expectations their own marketing departments have created.

Divided by technology

In effect, customers and companies have become divided by technology. Their relationship, conducted through computers, has become as dry and joyless as virtual sex. The dreaded "Interactive Voice Response," the on-hold music that doubles the annoyance of queuing, the codes and passwords, are all so many barriers to communication.

Too often, a new channel of communication simply multiplies managers' opportunities for making the same mistakes. Because most companies don't have a single "view" of a customer (which would allow call-centre, e-commerce, and marketing staff to share the same information), a website, for example, often just adds a layer of complexity and cost. You phone a call centre to complain about a bill — but you still get a threatening reminder through the post a week later. If you send an email, the call-centre operator hasn't seen it.

The result, according to Mr. Orsmond, is that rage among "mouse-bound" customers has reached an intensity just below that occasioned by divorce; while the queries and complaints generated by "mangled customers" trying, Humpty-Dumpty-like, to put themselves together again on company websites threaten to overwhelm existing call centres and oblige companies to set up new ones. Customers are invisible to organisations except as shadowy computer-generated stereotypes, while companies are remote and unreachable, a source of stress and suspicion rather than satisfaction.

Mechanical, computer-mediated relationships are bad enough. Companies make things worse by measuring and prioritising the wrong things. One of the clearest findings of the Data Vantage survey is that time-pressed consumers are putting quality of service above brand, features, and price. In short, people buy where they have the best experience. Yet companies — particularly the largest ones in mature sectors such as financial services, travel, and mobile phones — continue to focus on crunching costs and forcing customers through filters and scripts.

Fully 89 per cent of service providers are failing to deliver the joined-up service customers want, according to Mr. Orsmond — damaging brands, causing customers to defect, and putting more pressure on sales to run faster just to stand still.

Such things matter at the macro as well as micro level. In the U.K., politicians and others glibly invoke concepts such as the "information society" to soothe away disquiet about the withering of manufacturing and the growth of services, which now make up 60 per cent of the economy. Yet the U.K.'s productivity record, already mediocre, is worse in services than manufacturing. The failure of data assembly lines to deliver what people want in terms of convenience, expectation and experience, and the resort to knee-jerk cost-cutting, is troublingly reminiscent of the ills that beset the country's physical assembly lines — with just the same failure to understand markets and customers, and, crucially, build the right management skills.

Those skills are critical, says Mr. Orsmond, and in many areas they are lacking. While, as with physical production, it is essential to route the pipes properly, simplifying the runs and putting the right information on the screen at the right time, it is humans who work the valves and switches — and, even more importantly, humans wanting their problems solved on the other end of the line.

— © Guardian Newspapers Limited 2007

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