When companies focus on growth, it is easy for them to lose sight of their current customers. And if issues affecting current customers are not addressed in time, the wake-up call may be brutal. So what are the early signs that serious issues are emerging? And how can your Customer Satisfaction program help you identify the issues before it’s too late?

A European cellular phone provider, referred to here as MyCellPhone, nearly became a victim of its own growth and success. The company launched in the mid 90’s and quickly became successful attracting customers who were looking for an affordable alternative to the more expensive networks already in place. MyCellPhone’s business premise was that customers were willing to accept a less-than-perfect network for lower rates, particularly if coverage in the largest cities was adequate. However, CFI Group identified early on that improvements in the network were vital if MyCellPhone were to retain its customers, so investments in the network’s breadth (where do I have coverage) and depth (how well is it working) were intensified. Customer Service was a secondary priority at the time, along with other aspects of the customer experience.

Within 2 years of its launch, MyCellPhone had captured about 15% of the market, and after another 2 years, it was the leader in attracting new customers. Between Years 2 and 4, MyCellPhone implemented several targeted improvement initiatives that resulted in a 15% increase in its CSI, as customers perceived and reported vast improvements with the network as well as with most aspects of their experience with MyCellPhone. However, a serious issue was quickly emerging – one that could potentially lead to significant losses in customers were it not addressed promptly.

Results from the MyCellPhone’s CSI program showed that, amid all the improvements taking place, customers were quickly becoming frustrated with the company’s Customer Service practices (see Chart 1). While CSI was improving by about 15%, customers’ evaluation of MyCellPhone’s Customer Service dropped by about 18% and its impact on CSI just about tripled (see Chart 2) – making Customer Service a new priority for MyCellPhone if it wanted to stop losing customers in droves. Temporary fixes were quickly put in place, accounting for the improvements seen on Chart 1 after Q6, but problems soon return.

Chart 1

Chart 2

The root cause was easily identified: MyCellPhone was doubling its customer base every year and encouraged its customers to contact the company’s Customer Service department for any question they may have. But the number of call center representatives during that same period grew by a much smaller percentage. The result: MyCellPhone’s call centers were flooded with customer calls that the service agents were unable to address appropriately, as the priority was to answer calls (to reduce wait time) rather than solve the queries. For customers, the experience was therefore doubly frustrating. The average wait time was significantly above what was deemed acceptable, and once they made it through to an agent, their query was often dealt with in a hasty and unsatisfactory manner – making many customers frustrated and wanting to switch providers.

While the management team at MyCellPhone expected the performance score to be poor, it was surprised by the impact analysis, which showed that Customer Service had become the area with the most influence on customer retention – and therefore a new priority to address immediately. Consequently, investments were made in additional staff as well as increased call capacity, and a new IVR was implemented. It took another year to see true payoffs, but by identifying this new pain point earlier rather than later – and realizing its profound effect on Customer Retention – MyCellPhone was able to minimize the loss of customers and continue to grow at a rapid pace, while enhancing its customers’ experience.