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The Impact of Conflict Management Training on Customer Service Delivery

Recent research has demonstrated that Conflict Management Training can significantly reduce stress, improve employee performance, increase customer satisfaction, and do so in a timely fashion, thus having a positive impact on the bottom line.

Background

Competition is the most significant force heightening the demand for better customer service. Because products and/or services in almost every area of our economy today differ from one another in only minor ways, what really makes the difference, what gives one company an edge over another, is its relationship with the customer.

At present, over 90% of customer contact takes place by phone. Over 10,000 toll-free customer service centers offer support to external customers, as well as an equal number of internal customers, with over 3,400,000 Customer Service Representatives (CSRs) employed.

This is only the beginning: Latest statistics available on the Internet show that 15.6% of US households use the World Wide Web, up 40.5% in only four months time. When net-based voice communication software becomes readily available, these statistics will look like a mere drop in the bucket.

More complex products, software, hardware, and broadening customer bases force companies to re-evaluate how they do business, highlighting the need to see service as a highly strategic part of every organization. Service is key in purchase and repurchase decisions, and therefore, directly impacts costs, revenues, and profits.

CSR's

As a matter of record, CSRs make up one of the fastest growing and least appreciated segments of the US labor force and interpersonal skills training--people skills--are relegated to the bottom of the pile. Too many companies still think of front-line workers as mindless and disposable. Only the most advanced companies have let go of the mind-set that service is merely a cost center, and recognize that properly managed, these centers are important revenue generators.

The CSR has been identified as one of the ten most stressful jobs in America. Job stress costs employers an estimated $200-$300 billion yearly in absenteeism, lowered productivity, rising health insurance costs, and other medical expenses. Absenteeism and lowered job performance go hand in hand with job stress. Training programs need to include a component that not only heightens stress awareness levels but converts daily stressors into positive energy.

Increasing competition, change, diversity, customer sophistication, and demands for superior customer service, all call for ways to reduce the pressure on beleaguered CSRs while raising job performance levels. It is a given that a profitable workforce requires well-trained, knowledgeable, conscientious, service-competent employees who enjoy their service. The qualities sought in front-line personnel--enthusiasm, empathy, and tolerance for stress--are not on the curriculum in most schools. There is no Listening 101 or Communication 202. Somehow in the hierarchical management style, front-line workers werenąt encouraged to think about customer's or co-worker's needs. They just had to get the job done.

Today, demands of American consumers for high-quality service are greater than ever. Businesses that ignore the new realities of customer satisfaction can jeopardize not only their future sales, but also their very survival. Companies can boost profits by almost 100% by retaining just 5% more of their customers.

Not surprising, a Forum Corporation study reported that 70% of the customers lost by thirteen big service and manufacturing companies were lost due to lack of attention from front-line employees. To the customer, people are inseparable from the services they provide. It is no wonder, then, that companies with superior people management, invest heavily in training and retraining.

Complaints

Consumer complaints are pervasive and pose a potentially serious problem in all industries. Tens of millions of consumers experience problems each year with a product or service, yet few complain to providers. In fact, 90% do not. But they do complain...to other people. Most tell nine people and 13% tell 20 people.

Complaints are valuable for all organizations, especially for companies gearing up for increased competition. Firms that develop a reputation for consistently remedying customer complaints are more likely to develop customer loyalty and, over time, may increase their market share. It was found that listening to the consumer may increase repurchase intention even if a complaint is not resolved. It was also discovered that it was not an initial failure to deliver service alone that caused dissatisfaction, but rather the employee's response to the failure. Again, a dissatisfied customer, once persuaded to stay, was more loyal and more valuable than before.

Training

A vital part of interpersonal skills training is training in complaints. This is essential because skills required to handle upset customers are counterintuitive, that is, they go against natural instincts. When CSRs feel attacked, instinct is to either fight or flee. If you want service personnel to do something other than these actions--for instance, to empathize with the customer--give them special training that imbeds the alternative behavior and makes it second nature. Employees need appropriate coping and problem solving skills to handle customers as well as their own personal feelings in these situations.

Lack of training produces consequences: Overall, US companies satisfied their customers less well last year than the year before, (according to the American Customer Satisfaction Index), and services topped this list in terms of dissatisfaction.

Following is a research project completed in partial fulfillment of my doctoral degree that had positive impact on the bottom line.

Case Study

This study focused on CSRs and their interactions with customers at Connecticut Light & Power, a subsidiary of Northeast Utilities, a holding company, that furnishes electric service in most of Connecticut, New Hampshire, and Western Massachusetts. High Bill Complaints were the primary focus of the study--calls that represented between 10%-13% of the 2.5 million annual calls received by the company. These specific call types had historically been their hardest to handle, and traditionally the lengthiest.

The purpose of the study was to investigate the impact of Conflict Management Training (CMT) on customer service delivery. Specifically, it asked the broad question: What impact does CMT have on job performance and customer satisfaction in the delivery of customer service?

Costs for this call center were approximately $9.1 million, with:

  1. Labor accounting for 82%; Operations, equipment and capital representing the additional 18%.
  2. Labor cost per call averaged $2.25.

Subjects

Sixty people volunteered to participate in this study--17 males and 43 females. Using the Solomon Four Group Design, these 60 CSRs were divided into four groups of 15 each so as to eliminate instrument bias. Two of the groups, Groups 1 and 2, were pre-tested using a point-of-view survey that explored perceptions of job performance, job tension, empathy, anger, and communication. Groups 3 and 4 did not take the pre-test. Tables 1 and 2 reflect the demographics of this sample, and are self explanatory.

Conflict Management Training

Conflict Management Training, the independent variable, was delivered to the Treatment Group (Groups 1 and 3) in one four-hour off-site session. Within the Treatment Group, one group had been pre-tested, the other had not. The other two groups (Groups 2 and 4) underwent no training. Included in the training were modules that addressed:

  • Acknowledgment of front-line employees' critical importance to the company
  • Anger and problem solving techniques to defuse customers and move onto a more productive interaction
  • Job tension/stress management
  • Empathetic responsiveness
  • Listening/communication skills

To assess the impact of CMT, baseline and post-training data were collected and analyzed from a variety of sources. For instance, pre- and post-training, high bill inquiry calls were monitored and recorded using sophisticated software programs that captured, measured, and then analyzed the waveform representing the customer's range of speech (fundamental frequency) and tone of voice (intensity). Other data collected and analyzed pre- and post-training included:

  1. Written point-of-view questionnaires for CSRs
  2. Customer Satisfaction Surveys
  3. Monitored High Bill Complaint Calls
  4. Agent Performance Reports for length of call and CSR productivity

Results

CMT reduced job tension, improved communications skills, improved empathetic responsiveness, improved job satisfaction, and increased customer satisfaction (See Figure 2 for statistical significance), as well as significantly shortening the length of call. Specifically, CMT:

  • Reduced the length of High Bill Complaint calls by 22.3 seconds. For Northeast Utilities, this represented a savings of approximately $335,000 per year, or seven employees.
  • Improved customer satisfaction 9.3% for High Bill calls, and 7% overall at a time when the numbers were going down, not up.
  • Reduced CSR job tension/stress.
  • Improved communication, empathetic responsiveness, and job performance. If CMT were applied in other call categories, it seems logical that overall savings would also increase. After all, this particular call category was the hardest and longest call.

Conclusions

Current results afford management the opportunity to view CSRs as part of their organization's income producing marketing strategies, as opposed to viewing them as a cost that needs to be minimized, or as the first to go in a crunc. Companies must let go of the mind-set that service is merely a cost center. Properly managed, service is an important revenue generator. Companies need to shift how they perceive CSR's importance and provide them with necessary training so they can do their jobs effectively.

Although this study focused on CSRs who communicate with outside customers, CMT would also be beneficial for employees who interact with internal customers. Every employee interacts daily with these customers. The tone they set translates to every part of the company. Thus, each employee is a critical link in the chain that supports corporate objectives and long term goals.

Approach training as a process, not an event. We suggest 12 hours of live, soft skills training per employee annually, distributed over three or four sessions to:

  1. Minimize service disruptions
  2. Keep employees aware of being high on management's priority list, and
  3. Ensure training's long-term effectiveness

Soft skills should not be considered any less important to the success of any business than hard technical skills. Common practice is that hard skills training is provided and practiced over and over again until it is a habit. The same needs to be said and done for soft skills. When customers get emotional (and they do), only another person with a caring attitude and genuine concern can resolve the problem, request, or complaint. No software or hardware to date has empathetic responsiveness programmed into its system. In fact, weakness in communication skills can often wipe out any advantage in hard skills. People skills win out!

Therefore, substantially boost your quality, productivity, and overall efficiency by providing ongoing soft-skills training. In other words: Train...Train...Train!

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