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12 April 2010 | Ian Clayton Blog
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The Service Management Moment of Truth
This week Ian looks at why well designed and carefully managed customer processes lead to greater satisfaction and lower costs...

  Ian Clayton

Management gurus continue to warn us that in today’s service dominant economy, service providers must ‘think customer first’, and pay respect to, and carefully manage the customer experience.   We are being encouraged to apply ‘outside-in’ thinking and ensure an explicit customer reason is in every decision, including what services to offer, and the ergonomics of those services from a customer interaction and touch point perspective.

They also recommend key performance measures, traditionally focused on ‘process’ targets, such as maximum time waiting for a customer service agent, are replaced (I prefer augmented and trumped), with ’outcome’ targets, such as the number, or percentage of customer calls resulting in a satisfied customer.

Customer interactions lead to work performed by the service provider. Too often, process improvement driven initiatives ensure a focus on the work performed, rather than why the work is being performed, and for whom. The latter is critical to correct sequencing of the work, and targeting improvements that matter most to the customer, driving statements such as “process improvement is irrelevant unless it directly affects the results achieved, or the cost of achievement, preferably both” .

The business already knows, at the heart of understanding how to manage customer interactions and the overall customer experience, is recognizing and designing into products and services, ‘moments of truth’.  They also recognize a well designed and carefully managed customer experience leads to greater satisfaction, loyalty, advocacy, and a lower costs. Moments of truth are directly related to successful customer outcomes, or desired results, and are deliberately designed into customer interaction.

A Day Full of Moments

Everyday, each one of us has many tens, perhaps hundreds of  ‘moments of truth’, when we check our bank balance online, get cash from an ATM, check our email, or perhaps arrange to get a car serviced.   This is also true for end users and customers of information system services provided by an IT organization, and not limited to break-fix demand.  Its noteworthy the vast majority of an IT organization’s customers have moments of truth that go unseen, and unheard as part of a normal day at the office.

Of course, the ‘moment of truth’ concept is not new, and I like to refer people to Jan Carlzon’s book of the same name, written some twenty plus years ago, in which he shared his experiences, and the management approach he used, to meet the demands of a customer-driven economy.   If you are a service management professional and have not yet read this book, a small innocuous paperback of less than a 140 pages, I recommend you do so, at least the first 18 pages, it may well press reset on your definition of service, and service management.

The Service Encounter Wrapper

A moment of truth is defined here as, “any instance in which the customer comes into contact and interacts with any aspect of the service organization, or its products and services, and gets an impression of quality ”.  From a service provider organization perspective, we are surrounded by moments of truth our customers are experiencing, most are undefined, and many remain unknown and therefore unmanaged.

In a service context, moments of truth are embedded within a service encounter, which is the overall episode spanning the start of the interaction, and the end.  In an earlier ITP Report article I discussed the five most common types of service encounters (Close Encounters of the Service Kind). They represent outbound contact and an investment in the customer relationship by the service provider organization.

Service management is more about satisfying the customer than it is implementing or improving processes, capabilities, or artifacts like a service catalog.  For an initiative to be relevant to the customer, it must respect and involve the customer in discovering and co-designing the entire service encounter, and especially the moments of truth.  

Successful service providers, and service management initiatives, focus improvements efforts where moments of truth occur for maximum customer effect. 

Success Grounded in the Experience

For those of you active on, or considering a service management initiative, or transforming an IT organization to operate as a service provider, consider prioritizing your ‘process’ design and improvement efforts on the service encounters, the moments of truth they contain, and the customer experience.  The evidence is this approach will dramatically reduce the cost and effort of your project, the number of prerequisite artifacts you need to build, the effect of improvements, and ensure greater customer centricity, and relevancy. 

In some strange way we seem to have come full circle in that many service management initiatives are indeed facing their own moment of truth, in the form of management decisions to fund, pause, or perhaps even cancel them.  Remember, IT Service Management, or the implementation of an onerous best practice framework is not the goal, it is the method by which customers are served better.

This article contains extracts from the upcoming book ‘Outside-In Service Management™’.  For more information on the moments of truth concept and a basic ‘moment of truth calculator’, and how to apply outside-in thinking to a service management initiative click on this link.  

Any feedback and comments are always welcome!!   

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