COMMENTARY
Before you roll your eyes at the MBA speak or consider this item to be only for big companies, remember that every business serves people. Whether in B2B, B2C or S2S (stakeholder to stakeholder), servicing people and their priorities are common denominators and always have been.
While Covid-19 risks have exacerbated customer service optimization efforts, the movement to serve people omni-channel and highly personalized is not new. This is a return to how business used to be done to conscientiously meet the customers’ needs with extra effort. The cost avoidance* efforts of self service and advancing internet technologies took us away from proven basic tenets of customer satisfaction and positive experiences in the last 20 years.
It has been easy and profitable to let customers do the work and make it difficult to find a person to help them. While referencing the next normal, McKinsey says consumers are already demonstrating a preference for companies that deliver great service while reducing risks all along the customer journey. They have been doing this for years if you ask me.
Introducing another acronym, McKinsey shares four steps to help businesses enable contact-less operations from risk identification to solution execution. These steps help structure thinking and actions to help move forward in the next normal. Regardless of what causes disruption, these IDEA guidelines flex to include more human elements while keeping safety and security core.
- Identify interactions
- Diagnose and prioritize risks
- Develop and execute solutions
- Adapt and sustain
Source: McKinsey and Company, May 19, 2020. Link.
INSIGHTS: *In the last 30 years, industry has met customer-stated urgency needs almost without question. To compete with similar businesses and with brick and mortar retailers, overnight delivery services have been overused without clarifying customers’ true urgency needs and generally without assigning extra cost to individual customers. The benefactors have been UPS and FedEx. The costs were spread across all customers and reduced customer forethought.
In recent weeks, Amazon began prioritizing orders and resetting delivery expectations. Perishables aside, 2-day Prime became 7- to 10-day Prime. Options to combine all orders in one shipment with an extra day or two delay were made available. This is the action of a major supplier with its own delivery systems exposing consumers to the costs of fulfillment and logistics. It is also the action of a company focused on clarifying customer urgency.
As you share or consider the McKinsey IDEA steps, keep customer expectations measurement top of mind. JIT (just in time) does not need to equal next day. JIT needs to be defined by customers’ real needs and measured expectations. If it costs more to serve this customer segment, it will still be much less than flying every box to most customers.