The (service) revolution will not be televised.

What makes service businesses so exciting is that when it comes to services, inefficient systems abound. Opportunities are everywhere you look.
An example:
Product recall systems are about as inefficient as it gets, still relying on news releases, direct mail and mass media – that is, when a recall is dangerous enough to consumer health be picked up by the five o’clock news. If your product is simply defective, you’re out of luck here.
I asked Hen House Market, an absolutely terrific local food & grocery chain, how they distribute recalls.
Spreading the message through informed teammates and social media updates were the top answers. Those likely inform a lot of people, but far from everyone.
I then asked whether they measured the effectiveness of the communications. Sadly, the answer was “no”. (As an aside, if you’re faced with a choice between measuring the effectiveness of your latest direct marketing initiative and the effectiveness of your product recall communications, choose the latter. It isn’t tied to revenue, but it’s better business.)

But interestingly, they also mentioned that to improve the effectiveness of recall messages, they were working on a text message alert system for loyalty program participants. You know – those annoying key chain tags that provide savings on select products, where when you’re filling them out, you wonder, “what are they ever going to do with my cell phone number – call to tell me they’re having a sale on cantaloupe?” Once launched, loyalty program participants would receive text message alerts if they’ve purchased a product on a recall list using their rewards card. Discounting products AND helping prevent me from accidentally killing my dinner party guests? Talk about a loyalty program worth signing up for.
It's a small fix to a long-standing problem.  These kinds of service inefficiency problems are so prevalent, most of us don't even think of them.  Yet people are addressing them in increasing numbers, using technology in dramatically new ways, whether the local grocery store’s use of text messaging for recall information, or the IBM Watson project, a program devised as an initial salvo in the fight to create better service outcomes through technology.
My own personal request for technology to improve my service encounters: In a world with nearly universal wi-fi, Google maps and Twitter, why do I ever have to wait in a line?

How about you:  What services would you like to see made more save time & effort or produce better results?

AT&T broadband cap gets a consumer wag-of-the-finger

AT&T made news this week by announcing a cap on broadband for personal internet use. Based on my own (purely unscientific) review of the comments circulating through social media sites, the move wasn’t favored by consumers.

From Twitter:

JD_Wright: Broadband cap? I think our days with AT&T for internet service are very limited.

Joel_Turnipseed: @att added a cap and didn’t lower price, this is why I have moved internet providers "att capping broadband http://t.co/u9YrKmi"

kevinlam14: AT&T cap broadband usage! 150gig for DSL and if you go over, $10 is charge for another 50gig http://ow.ly/4NAAs This is a load of crap!

beermonkey: Time to switch providers out of principle alone. RT @News4WOAI: AT&T putting cap on broadband http://bit.ly/mGoiqT


But before committing to indignation about how this is a money extracting move by an evil cable company who doesn’t want to provide the service it’s loyal customers, consider this as a move that potentially protects the service experience.

According to AT&T, the top 2% of customers – those for whom the cap will apply – use a full 20% of broadband.

When one customer’s service experience adversely impacts the service experience of other customers, the company has a decision to make – protect the experience for the customer whose use is negatively impacting others, or intervene to protect the experience of the many.

In some cases, the decision is easier than others.

If the customer is improperly using a company’s service experience – think of a severely intoxicated passenger on an airplane – the difficult but appropriate response is often to remove them from the service environment, to be served in another way or not at all.

On the other hand, if a customer simply uses “more than their fair share” of the company’s service capacity, the company has the option to charge for the capacity-draining use to either modify the behavior and bring capacity use back into balance or ensure any continued extreme usage of the service is compensatory.

The AT&T cap on broadband (which isn’t a cap, as much as a charge for excess use) isn’t without precedent. In fact, it is somewhat similar to the intelligent traffic system IBM implemented in Stockholm, which concurrently solved a major congestion problem while increasing municipal revenue and was ultimately seen as a creative solution to a difficult problem.

What is interesting to me is that while both organizations made changes to preserve scarce service capacity to serve more customers more effectively (and make more money doing it), one is met with case studies while the other is met with catcalls.

The service quality air travelers refuse.

When traveling, accompanying business associates tolerate my travel habits as much as I tolerate theirs.

See, most of my travelling companions are prototypical business pros when it comes to travel. You know the ones. You see them moving through the terminal like a mule train, with oversized laptop cases perched atop oversized carry-ons.

When I pick up my checked bags on arrival, they always grouse about the delay in getting to the rental car shuttle quickly. It’s about that time that I remind them that it was they, along with 50 similarly-intentioned travelers, who, in trying to fit a steamer trunk into the overhead bins, backed up the loading of the plane while they tetrissed their luggage into position, warped bin doors closed or had to have them gate-checked, inevitably making the plane late for departure.

Checking luggage is my own social contract. We can all take off & land on time much more frequently if we let airlines do a better job separating the loading of luggage from the loading of people.

Don’t believe me?

Check out this video from IBM about the baggage operation at schiphol airport in Amsterdam. 140,000 bags per day. 21km of conveyors. In-transit tracking. 50 million bags / year, expected to increase 40%. Runs like a Swiss clock.




Engineered service systems like this are making service processes more efficient while they are improving the likelihood of positive outcomes. Yes, this is an extreme example, but it has been years since I’ve had a bag misplaced or delayed. My track record for on-time flights is nowhere near as stellar.

You may not change your behavior (airlines imposing baggage fees are doing their best to make sure their operations continue to run as inefficiently as ever) but the next time you see a business traveler fight their carry-on for 3 minutes, only to give up and gate check, walking back up the plane aisle past 30 passengers waiting to board and unable to proceed to their seats, perhaps you’ll think about miles of conveyors and systems designed for the movement and loading of bags onto planes.

Alex Trebek's Service Innovation Contribution.

The IBM Jeopardy challenge is captivating technophiles and game show fans alike this week as Watson – IBM’s artificial intelligence designed to answer natural language questions – competes against two all-time Jeopardy champions. Reactions to the highly televised demo have ranged from outright wonder to outright fear – the latter based on an idea that Watson may somehow show up tomorrow to compete for a job you’re applying to. (If that is the case, I’d suggest working on your trivia skills for the interview.)

The demonstration also has drawn me in. Not because of trivia or tech inclinations - both of which I may have - but because I’m a service geek.

In the last six months, I’ve had the pleasure of seeing two Senior IBMers talk about the Jeopardy Challenge, which we now know as Watson: first Nicholas Donofrio at the Kansas City Chamber of Commerce Innovation Conference and then Robert Morris, keynoting at the WP Carey Compete Through Service Symposium.

Both speakers shared a vision of the Jeopardy Challenge algorithm intelligence initiating a service quality revolution similar to what we saw in product quality in the latter half of the last century.

It makes for good strategy that the world’s largest service business positions itself to lead in a global service economy that for some countries already approaches 75% of GDP.

In the IBM view, service quality refers mostly to the ability for service encounters to produce a successful outcome. It's these service consistency & reliability problems – the type for which understanding of solving problems expressed in human language is critical – that are the future for Watson.

It makes sense. Variability among front line service employees, customers and in the service environment make for results that are more difficult to replicate than in product businesses. Putting Watsn-like technology on the front line of service would help reduce variance in the experience customer interaction-to-customer interaction.

But service quality isn’t just about reliability. Successful service experiences may be based as much on the less concrete experience dimensions of responsiveness, empathy and assurance as they are on outcome reliability. Because of this, prudence needs to be used in applying the technology. It carries the risk of improving reliability of outcomes, while at the same time reducing the ability to provide the less tangible responsiveness, empathy and assurance aspects of service quality that many service encounters are ultimately judged by.

While Watson is gaining praise for its second day dismantling of a pair of Jeopardy Hall-of-Famers, I’m still more interested in what it's going to do next.

Compete Through Service Symposium: A source for services thought leadership.

I credit two early sources for much of my perspectives on service and leadership – formative years spent as an officer in the Canadian Navy and in a program associated with the Arizona State University Center for Services Leadership.

The Navy is the sort of place that, once you leave, you really can’t go back to refresh your perspective - at least not formally.

The Center for Services Leadership, its objective in bridging the business & academic communities to compete strategically through the profitable use of services, is much more accommodating. They offer array of continuing programs, including service business webinars, cutting edge research & resources, and a series of events capped by the annual Compete Through Service Symposium.

Symposium is the venue for some of the best service content I’ve ever taken in, and year-after-year is a veritable who’s who of businesses engaging in service excellence. This year, Avnet, DuPont, Marriott, IBM, Zane’s Cycles and Zappos, and others are represented as content providers.

Symposium offers any service business great lessons with practical application for:
- Service design & innovation
- Use of technology to facilitate the service experience and service environments
- Transformation product-based companies into services oriented companies
- Creation of lasting customer loyalty
- Service process improvement by mapping the service encounter
- Service recovery
- Service culture & values
- Service differentiators for B2B

This year, I’m proud to be not just an attendee, but a contributing member of the social media team. You can look for updates on Twitter under the hashtag #CTSS, in the Center’s official blog, and in this space.

This post preaches to the converted, but I know hundreds of service business professionals that care deeply about creating customer value and want to continue to get better at their craft. Regardless of level or organizational function, the Compete Through Service Symposium has content, experts and opportunities to help any business or individual differentiate on service.