Poor Customer Service Costs UK firms Billions

Poor Customer Service Costs UK firms Billions – so why can’t they get it right?

Since the Covid lockdowns, many companies have scaled down customer service, extending deadlines for complaint resolution and reducing staff. Some have removed helplines, leaving customers reliant on ineffectual chatbots. Poor customer service is costing UK businesses £11.4bn a month in lost productivity, according to new research, with employees averaging one day a week dealing with problems.

If businesses embraced technology effectively there are a limitless possibility available to address inefficiencies and improve the customer and agent experiences. Often times businesses are not taking full advantage of the technology they have already invested in but when looking to invest in new contact centre technology the landscape is really complicated, and since the advent of generative AI it is moving at a faster pace than ever seen before.

Key themes driving investment in technology
Rising Agent Expectations

The clear change in agent demographics – their expectation for intuitive, easy to use tools; their expectation around flexibility in their working week, and their ability, through the advent of working from home, means geographic restrictions are no longer tying agents to a specific centre in a specific town.

And the competition for good customer service agents is fierce so the easier their experience the more likely businesses are to retain them and keep them engaged.

The Digital Shift

Digital transformation continues to reshape customer interactions focus and prioritisation. The adoption of various digital technologies provides customers with diverse communication channels, from email to social media, creating a need for businesses to adapt. Convenience is a key driver as customers seek faster and more efficient interactions through 24/7 accessible channels. Multichannel and omnichannel experiences are now crucial, offering a seamless journey across platforms, and self-service adoption.

Digital Shift as a Cost Cutting priority

Reducing the cost to serve is a primary focus of channel shift initiatives, but caution is urged to avoid the pitfalls of past industry shifts (the move to offshoring customer service in the early ‘00’s). The move to offshoring customer service teams saw a reduction in headcount costs of 50% + but businesses raced to near shore or home shore when the Customer Experience was impacted to such a degree it was impacting retention and satisfaction rates.

The challenge lies in finding the right balance between cost-cutting objectives without compromising customer satisfaction. Businesses must ensure that technology aligns with the personal channel preferences and the understood intention of the customer. Technology can support the delivery of channel shift initiatives but there is a need for businesses to understand that the technology alone will not deliver this objective – it is the road system – and the businesses must provide the signposting.

Cloud Implementation and Cost Efficiency

Migration to the cloud is a prevalent trend, driven by expectations of cost reduction and the advancement of technical capability. However, achieving cost efficiencies in the cloud requires careful planning, resource optimisation, and leveraging appropriate services.

Simply moving old workflows, old processes and trying to retrofit them into a new cloud solution will not work (look at the challenges faced at Birmingham City Council, the largest local authority in Europe, who has declared itself in financial distress after troubled Oracle project costs ballooned from £20 million to around £100 million ($125.5 million).

Organisations must be very clear on their expectations before embarking on their journey to cloud-based solutions. By evaluating the alignment of cloud solutions with their specific goals, whether it be cost savings, increased NPS, or CSAT there is a much greater opportunity to unburden yourself from tech debt and legacy processes and deliver an ROI.

The CX Tech and Contact Centre Vendor Landscape

Ultimately the CX experience is impacted by the effectiveness of your customer service. Outsourcing can lead to a significant enhancement of this crucial aspect of your business.

From substantial cost savings and access to specialised talent, to scalability and enhanced focus on core competencies, outsourced customer services can connect your business to new opportunities and competencies.

However, with more players than ever across the Contact Centre tech stack, many buyers refer to – or in some cases fully rely on – the top analyst firms to determine which vendor to invest in.

Many of these include Gartner, Frost & Sullivan, and Forrester. The diligence put into the assessment of vendors by these analyst firms is very comprehensive however, it some are more focussed away from the European market and therefore not always useful for European buyers.

Being named in the Gartner Leaders quadrant is a significant achievement, but it doesn’t guarantee that a company is the best fit for every organisation’s specific needs. Different companies may prioritise different aspects of CX, and what works for one may not work for another.

Therefore, it’s essential for organisations to carefully evaluate their own requirements and goals when choosing a CX solution or partner, rather than solely relying on the positioning from analysts’ firms.



Keith Gait MBA CCXP is CEO at the Customer Experience Foundation

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