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Voice of the Customer Conference

By Phil Verghis on June 17, 2010

Once again, I’m a co-producer and active participant at the 4th Annual Voice of the Customer Conference near Boston. Now in its fourth year, the First Wednesday Group’s annual conference has built a strong reputation as the place for leading-edge insights from the support world’s smartest people. Some of these smart people are on stage with microphones; others are part of our audience of hands-on support managers and professionals–people who are eager to share their ideas and experiences with their colleagues in an intimate, friendly retreat away from office distractions.

Find out more at: http://www.first-wednesday.com/conference/

Guiding, not Grading — aka Measures, Metrics and Madness

By Phil Verghis on May 8, 2010

Over the last year or two, I’ve been trying to replicate the magic of start-ups – where everyone is laser-focused on the mission of the organization. Everyone knows what needs to be done and just does it.

Unfortunately, this ‘honeymoon’ phase quickly dissipates during the transition to a middle-aged company and beyond.

I think I’ve moved one step closer to finding a solution, as this month’s article discusses. Two of my retainer-based clients are one year into the ‘alignment and measurement’ process, and have reported (mostly) amazing success.

One of the biggest unanticipated side effects has been the boost in employee morale, which has a multiplier effect on productivity, customer loyalty and so much more.

Get the article in a pdf format — http://bit.ly/cpFoMv or sign up for the next newsletter from my home page – www.verghisgroup.com

Customer Service: Reducing churn and bringing in money

By Phil Verghis on April 1, 2010

A highly under-rated and under-used partnership is between marketing and customer support/customer service. I’m working with a large client now where (as part of a larger engagement) we explored and developed a partnership between marketing and customer service that has resulted in more loyal customers that at the same time yields tens of thousands of dollars of incremental revenue a quarter.

Yes, it can be done without turning customer service and support into sales people. They always have to be the customer’s advocate. However, understanding the customer lifecycle, personas and churn risk points and making that part of the support DNA helps. Dramatically.

Embedded in this interesting article from the Economist is something similar that Cablecom (a Swiss cable tv/internet/phone provider) did.

“Like many telecoms providers, Cablecom has grappled with churn.  Using advanced data analytics, Cablecom discovered that although customer defections peaked in the 13th month, the decision to leave was typically around the 9th month (as indicated by things like the number of calls to customer support services).  To reduce defections, Cablecom offered at-risk customers special deals 7 months into their subscription. 

The results were impressive:  customer defections fell from 20% of subscribers a year to under 5%, enabling the firm to save significant marketing acquisition costs while boosting customer satisfaction.”

‘Savvy Support’ model (aka no more tiers) cited in new book

By Phil Verghis on January 30, 2010

Andres Sanchez has published a book titled Technical Support EssentialsAdvice you can use to succeed in Technical Support and has cited the Savvy Support model a few times as one of the new models for support.

Read all about it, and much more of what Andres has to say in his book.

Zen and the art of aircraft engine maintenance

By Phil Verghis on December 17, 2009

(From the Dec ’09 issue of my newsletter, The Verghis View. Get your own subscription at my home page  – www.verghisgroup.com )

Many of you have heard me refer to software maintenance fees as “bad” revenue. While it is very lucrative, it’s bad because customers are unhappy paying it – ask any CIO. To give you a sense of how massive these fees are, Oracle made $12 billion last year – no, that’s not a typo – $12 billion from services and maintenance fees, according to Information Week.

I did some research on how other industries demonstrate value for their maintenance fees, and found it in an unlikely source – aircraft engines. (From this article in the Economist.)

All the major players – Rolls Royce, GE, and Pratt & Whitney – reportedly lose money on the sale of the engine. They make up to seven times the revenue from servicing and selling parts.

Interestingly enough, Rolls Royce has embraced two concepts that go beyond what the vast majority of companies provide in the software space.

First, they abandoned the traditional “break fix” model. Instead, they have taken real-time monitoring to a new level. In a world of mind-numbing complexity, they have (thankfully!) assumed that customer-impacting failures are to be minimized.

In their operations center in Derby, England, vast amounts of data is collected in real time from thousands of engines in flight. This flood of data is immediately analyzed and, if a problem is detected, Rolls Royce informs the pilot in flight. Repairs are arranged at the next stop, rather than waiting for it to become a full-blown emergency.

The data analysis continues after each flight is over. This helps Rolls Royce anticipate future problems and reduce the number of emergency repairs – and unhappy customers. As you can imagine, whenever a plane is yanked from service, the ripple effect on an airline’s schedule, revenues and customer satisfaction is non-trivial.

Real-time information monitoring saves Rolls Royce lots of money in terms of better-designed engines, and increases the time between engine rebuilds (now up to 10 years).

The second thing RR does differently is to charge by the hour the engine is run. This makes perfect sense. The aviation industry’s equivalent of “shelfware” is idle planes parked in the desert. The struggling airline industry loves it. After all, why pay for maintenance on expensive engines when your planes are grounded?

The lesson? Don’t settle for break-fix when you can do far better than that. Your service and support team can actually improve your customer’s business, while charging fees that make more sense for the customer.

In this example Rolls Royce gets paid very lucrative services revenue only if the service is being used. So it’s in both Rolls Royce’s and the airline’s interest to keep planes in the air – one of the key drivers to reducing cost per passenger.

Look ahead to 2010. How can you use customer information to improve their business – and your own?

Interesting article on software maintenance fees

By Phil Verghis on December 11, 2009

Oracle’s revenue from software maintenance and service fees have reached $12 billion a year. Read what this interesting article had to say on this topic (includes SAP and more).

http://bit.ly/Sv3ub

Voice of the Customer conference starts today

By Phil Verghis on November 2, 2009

After almost 4 weeks of travel (just crossed the 100,000 mile mark with United Airlines this past weekend), I’m back in Boston for a few weeks.

One of the reasons I’m back is the Third Annual Voice of the Customer conference hosted by the First Wednesday Group. There is a terrific lineup of speakers and participants. If the past two years were any indication, it should be a fun event with a lot of provocative ideas. I’m looking forward to seeing many friends, colleagues and customers there.

 (Disclaimer, I am one of the producers of the First Wednesday Group.)

High quality, low cost Voice of the Customer Conference…

By Phil Verghis on September 28, 2009

The Voice of the Customer Conference 2009
Boston, November 3-4

 Some of the strongest, most active communities in the social media world are based on post-sale customer support relationships. User groups, online forums, advisory boards, expert networks, survey panels–a growing number of “voice of the customer” channels now provide a rich dialog between companies and their customers.

 A great place to learn more about how social media is influencing the support world is the First Wednesday Group’s annual Voice of the Customer conference, which will take place Nov. 3-4 at a conference center outside of Boston.

This is a boutique event–highly interactive, small in scale, with an impressive lineup of expert speakers and an audience of managers with a good deal of hands-on experience with social media in a customer support environment.

If you’re looking for great conversations and lots of real-world data, this is the place to be.

 Registration is $385/day. For speaker and program details, please visit

http://www.first-wednesday.com/support_conference.html

How do you mine sentiment on the web?

By Phil Verghis on August 24, 2009

Ah the simpler days of the Internet. Way back in 2002, during my Akamai days, we had team members manually mining public forums for customer comments during live events to ensure that we could pin point and resolve issues close to real time. Of course it would be impossible to scale staff enough to do that smartly today.

That’s why today’s New York Times article  (free registration required) on some of the tools available to mine blogs, Twitter and more caught my interest. Selected quotes from the article:

Scout Labs recently introduced a subscription service that allows customers to monitor blogs, news articles, online forums and social networking sites for trends in opinions about products, services or topics in the news.

Jodange offers a service geared toward online publishers that lets them incorporate opinion data drawn from over 450,000 sources, including mainstream news sources, blogs and Twitter.

Bo Pang, a researcher at Yahoo co-wrote “Opinion Mining and Sentiment Analysis,” one of the first academic books on sentiment analysis.

To get at the true intent of a statement, Ms. Pang developed software that looks at several different filters, including polarity (is the statement positive or negative?), intensity (what is the degree of emotion being expressed?) and subjectivity (how partial or impartial is the source?).

For example, a preponderance of adjectives often signals a high degree of subjectivity, while noun- and verb-heavy statements tend toward a more neutral point of view.

How are you tracking sentiments about your organization? Have you been able to strike a good balance between a rapid response and appropriate response (i.e. not over-reacting) ?

The 80/20 rule does not seem to apply with online knowledge bases

By Phil Verghis on August 24, 2009

After years of being able to use the proverbial 80/20 rule, anecdotal evidence seems to point to it being even more skewed with online knowledge bases. Growing evidence from my own clients and listening to other knowledgeable observers points to a new 2/98 rule.  For a sample size of thousands of documents, one or two percent of the documents account for close to 50% of all the ‘hits’.

Note: If there is great seasonal variance (for example back to school time for an University or tax time for a financial software company) then look at your usage statistics split out by season so you don’t lose the trees for the forest…


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