It was a routine Tuesday morning like any other. As the minutes melted into hours, I began to tick one task and then the next off my itinerary, until it was time to finally tackle the one chore I’d been dreading all day – calling my Bank appointed wealth manager. I wanted to go over a few concerns I had about a financial instrument he had recently sold me. The instrument in question was not performing the way the company had initially promised, and its management was not aligned with what I had been informed at the time of investment. This very wealth manager had personally recommended this instrument in accordance with my needs and risk appetite at the time, and I, therefore, expected some reassurance from him in terms of its performance.
Instead, he referred shrugged my concerns away, pointing instead to the fine print, which stated that the asset manager had the flexibility to change the management approach for the financial instrument, as deemed fit. There was no further conversation to be had on that front, and I hung up, very disillusioned with the experience I’d had. A few days later, the wealth manager called back, not to address my concerns as I’d expected, but to sell me another financial instrument.
His approach to customer service, although a little exasperating, is not unique or isolated. In fact, I’ve found this same cavalier attitude towards customer service and customer satisfaction perpetuated by a number of Indian companies, both large and small. My telephone service provider, for instance, will bombard me with calls and messages reminding me to pay my bill on time, even though the due date is more than a fortnight away. When I expect the same enthusiasm to my concerns about poor service, I am almost always disappointed. After a few days of radio silence, I usually receive a curt notification stating that my case has been closed because my problem has apparently been resolved.
The problem, I’ve found, lies largely with the parameters by which these organisations monitor and measure performance. Although most organisations make lofty claims about being customer centric, whether in their vision statements or mottos, their internal measurements are all focused on revenue and short-term sales. Employees are under constant pressure to deliver sales, with little emphasis given to whether they are effectively servicing the customer or ensuring customer satisfaction. In fact, in most of these organisations, customer satisfaction is always postponed in favour of financial results.
When I look back, I contrast this with some of the consulting firms I was formerly associated with. In these organisations, high weightage was given to customer satisfaction and customer relationships. While financial goals and meeting sales targets were considered hygiene, I had to give equal emphasis to customer satisfaction in order to progress in the organisation or even earn my bonuses.
This approach has undergone a marked shift in recent times. I have found that in many companies, especially when they are listed, there is an undue weightage given to the next quarterly results. All other parameters, such as customer satisfaction and relationships, institution building and employee development are reduced to decimal points in the executive score card. With undue weightage to short term financial performance, the essential parameters important for long term sustainability and success of the organisation, do not get the necessary attention they need.
From a corporate governance perspective, while the organisation’s financials are regularly disclosed in order for stakeholders to gauge the company’s current and future performance, the parameters based on which executives are measured are never disclosed. Executive measures reflect the true priorities of the company and disclosure in my view is therefore critical.
Customer satisfaction and staying relevant to changing customer needs is very critical for future sustainability and continued success for any organization. It is only when customers consider the organisation relevant to their existing and future needs that they continue to maintain and build upon their association with the organisation. This is a fundamental difference that distinguishes world-class institutions, who will always give higher weightage to customer satisfaction and strategic relationships.
In light of this dilemma, should organisations, be mandated to disclose how relevant their customers find them, in addressing their needs on an ongoing basis? Several organisations do conduct surveys to track customer satisfaction, but these surveys are rarely made public.
Like wise, should organizations be required to disclose the parameters on which their executives are measured? If stakeholders are made aware about the performance management criteria for senior executives, they will be in a better position to understand if the stated future direction of the organization and those of the executives are indeed aligned.
First published on Linkedin on 30th March 2018