Wednesday, February 07, 2018

Business Strategy for Service Providers

From the 2018 FISPA LIVE Show Guide is my article about Business Strategy for Service Providers.

Join me for two sessions on Wed., 2/7/17 at FISPA LIVE:  Bundling to Compete and How to Have Your Best Year Ever!

For many years I have been chanting Layer 1 or Layer 7. In other words, either own the network (OSI Layer 1 – the copper, the fiber or the airwaves) or own the customer at the desktop. Layer 7 was my way of saying software – SaaS or Managed IT or UC or Virtual Desktop. Legacy ISPs have
provided their value-add at the data link (Layer 2) or network (Layer 3) layer. This resale model is difficult and not very profitable.

Since then, many members of FISPA have embraced a hybrid business model of resale, fixed wireless, fiber and managed services, combining several OSI layers.

Today, the business strategy of a service provider has to be about the Customer Experience (CX). Service delivery by the Big Guys is as automated as they can make it. That provides great benefits to the cost of service delivery, but it wreaks havoc on customer service.

“Profits follow customer satisfaction, not the other way around,” wrote famous management consultant Peter Drucker. The strategy should be to have a culture of caring. As Peter Drucker said, “Culture eats Strategy for breakfast.”

A few years ago Rackspace and Zappos were the talk of the business world due to Rackspace’s Fanatic Support and Zappos’ CEO touring the country about culture and happiness. Comcast and AT&T have yet to embrace any of those mantras. But that is good for you!

If you look at the UCaaS sector as an example, there isn’t a provider that stands out for service delivery. That could be the differentiation point for that sector and would result in decent word of mouth, the best social marketing you can get.

The Customer Experience in telecom is pretty awful after the contract is inked. It is at these points when you win or lose future business. Even if they stay through the contract, the bad taste in their mouth from poor customer experience will be with them. The big complaint during a network outage isn’t the outage itself; customers understand that. It is the lack of communications that is the issue. Customers seek clear communications acknowledging the outage, the estimated repair time, etc. That goes into CX.

Every touch of the customer goes into CX – from the installer cleaning up after himself to the billing admin’s friendly demeanor. On and on at each touch point is a chance to keep or lose a customer. It is also an opportunity to turn a customer into a brand evangelist. An evangelist will tell people about your service.

It doesn’t matter if you are an MSP, VAR, ISP or fiber operator, re-examine each customer touch point. One reason is to ensure that the processes and procedures are written down. Another reason is to get input from the people who work at that junction to provide feedback on ways to remove friction (and perhaps add some awesomeness).

Each touch-point is a chance to keep or lose a customer, and an opportunity to turn a customer into a brand evangelist that will tell people about your service. Current business strategies include customer feedback loops – for instance, implement a Board of Customers.

Internally, ensure that processes and procedures are documented, and create operational teams to get input from employees who work at every customer contact point (personal, phone, email, websites, portals and customer contact systems). Implementing a customer relationship management (CRM) system that all departments and all employees must use will increase your knowledge base on each customer, and empower employees to provide a better CX. Be sure to monitor social media and proactively provide feedback (and increase market awesomeness). It’s little things that end up being major: Follow-up emails; handwritten thank you notes; clear, simple communications; and follow-through are the hallmarks of customer experience, and the keys to future sales.

As Zig Ziglar said, “Sales is helping!”

If you design a culture of customer experience, sales will increase. Taking friction out of the way for customers will streamline some processes. Just the exercise of looking at all these touch points – of the whole service delivery process – will provide some upside. And it is all upside when you have a strategy to make the customer experience better.

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