Article

Achieving Success in the "New Normal"

By Steve Callahan
Practice Development Director

Surviving the economic turmoil of the last two years has required, in many instances, draconian measures as companies have faced investment losses, revenue declines, and increased competition. The industry as a whole has reacted strongly, imposing increased governance practices, clarified product portfolios, enhanced investment management disciplines, and strong expense management. Expense management has been one of the greatest areas of focus, with the industry experiencing a drop of approximately 20% in total operating expenses two years in a row. These reductions have come at a human resource cost because fewer employees have been asked to complete more work faster in an environment where quality is critical.
 

At the same time, as the industry emerges from the downturn and enters a slow recovery, nothing has become more apparent than the importance of service delivery as a competitive advantage. With products fast approaching parity in terms of pricing and guarantees, achieving differentiation in a highly-competitive market turns more and more to the ability to deliver service in an exemplary manner; one that binds consumers to the company and earns their loyalty.
 

Baseline expectations are for transactions to be completed on a once-and-done basis, without handoffs and callbacks, correctly the first time, and on the consumer’s schedule. “Customer-centricity” has become a necessity for achieving competitive advantage. The foundation of a true service advantage is the front-line human resources who represent the thousands of points of contact with customers on a daily basis. These same resources are the ones that have been optimized, streamlined, and redesigned to achieve the necessary expense savings.
 

The “new normal” is the result of economic and regulatory changes and demographic shifts, and achieving profitability in the new environment will require intensely-focused strategy in managing a company’s talent resources. The differentiation will come from the skills, attitudes, and abilities of the front-line and transactional staff who represent the source of service delivery.
 

Recall any simple transaction that left a lasting, positive impression on you versus the same type of transaction that left no—or, worse, a negative—impression. Even done right, the human contact involved in delivering service defines the impression made upon the customer, and that contact depends upon the attitude of the individual service staff. Developing a culture that breeds the right kind of service-oriented attitude will be a key requirement to achieving the level of differentiation necessary to overcome competition.
 

Granted, relatively high unemployment would appear to make it a buyer’s market in terms of resources. However, acquiring and retaining both the quality and the necessary service orientation will require more than simple competitive wages and an efficient work environment. Companies will need to develop programs that institutionalize an awareness of the importance of not only doing things right, but in how these things are done. Impressions and treatment will be the defining characteristics, with thoroughness and correctness being baseline expectations. The challenge comes in shifting from an expense reduction focus, where efficiency and austerity were necessities, to one where strategic investment in service development programs and supporting technologies becomes the norm.
 

This challenge arises at a time when both the consumer and workforce demographics are shifting to a more global and diverse constituency. Leading and serving in this environment require greater sensitivity to differences in values and cultures. Addressing these complex demands requires a two-pronged strategy.
 

First, from a consumer perspective, greater analytics supporting a deeper understanding of each unique market segment are required to feed information into the sales and service process. True customer relationship management systems that collate and organize a company’s interactions to inform each contact provide a basis for personalizing service in a manner that leaves the customer with a sense of being treated as a unique and important individual.
 

Second, from an employee perspective, companies will need to look at employee programs that provide flexibility, convenience, a sense of balance, transparency, and a supportive environment. Job enrichment opportunities to keep talented staff challenged will be as important as providing the tools and empowerment necessary to deliver on customer expectations. Employee engagement will be the measure of success in terms of workplace effectiveness.