An economic crisis can pose a thorny challenge for customer service leaders striving to keep their penny-pinching bosses on side. 

That’s because customer service has traditionally been viewed as a cost rather than profit centre within a business, largely down to its ‘labour heavy’ army of agents and contact centre staff. In recent years, the adoption of new technology, such as chatbots, to aid the customer experience has also raised the department’s price tag.

As such in tough times. when a business is looking to find efficiencies, customer service can be in the firing line. This can include making staff redundant, outsourcing customer service to third parties either in the UK or abroad, or conversely bringing them back in-house if that is more cost-effective.

“These could be strategic decisions made by the board, or a chief financial officer giving every department a 10% haircut,” says Martin Hill-Wilson, owner of Brainfood Consulting. “Despite some moves to self-service through technology, most service directors still find that a high percentage of their operational budget remains headcount. Some of those directors may never have dealt with a recession before and think the answer is to cut everything immediately. Others may just switch off their phones and pretend they can’t hear the screams. But they need to be smarter.”

That means accounting for the behaviour of those cost-conscious and increasingly frantic customers. “During these times, the number of customer enquiries is likely to increase, as people face more affordability issues,” says Martin Brown, chief commercial officer at FM Outsource. “This may include cancelling a subscription with a business, querying their bills or returning items.”

According to recent figures from The Institute of Customer Service, 44% of customer-facing staff have seen customers asking for more information about cheaper alternatives, with 35% seeing customers asking for more support in managing their payments.

Hill-Wilson adds: “In a recession, our instinct as anxious consumers is to gravitate towards human beings rather than technology. Customer service and contact centre staff add a lot of value to customers and thus service leaders need more rather than less headcount.”

In a recession, our instinct as anxious consumers is to gravitate towards human beings rather than technology

In the current times that brings its own headaches, with millions of people leaving the workforce post-Covid and younger people eschewing the contact centre industry because of low wages and the challenges of remote working. So, faced with these challenges, what can customer service directors do to ensure customer service remains at high levels?

Hill-Wilson urges customer service leaders to combine the strengths of both automation and staff. This may mean technology, such as AI-powered chatbots or mobile apps, to take away laborious manual tasks such as finding out delivery times for customers. “Look at how a typical customer journey can be sped up through technology,” he explains. “More use of customer data, so you can personalise customer engagements, can also save time as the customer does not have to repeat their details.”

These measures should free up staff to deal with more complex, emotional customer calls. To take full advantage, staff should be trained to treat stressed customers in an empathetic manner. This includes recognising signs of distress or lack of understanding of an issue.

“There should be a focus on conflict management, listening skills and asking the right type of questions,” advises Jo Causon, chief executive of The Institute of Customer Service. “Also look at other options, such as help with debt management. It’s about signposting, offering reassurance and walking in their shoes.” Technology can play a part here too. For example, using speech or text analytics which can inform a service agent about a customer’s emotional state. 

Putting an increased focus on looking after their customers during the turmoil of the last few months was a key reason why Truro-based luxury property developers Stephens + Stephens recently set up a dedicated in-house customer care team. 

“Each buyer has an assigned customer liaison individual throughout their journey, from initial reservation to the purchase, key exchange and ensuring they are settling in well to their new home,” says customer care manager Christine Rostock. “We want to build long-term relationships with our customers and maintain our high level of service. The customer care department is also that central cog tying everything in the business together, from sales to the building sites.”

Hill-Wilson believes such collaboration between departments is crucial in improving the customer experience. “If the marketing team is pushing out a sales message on Monday morning, then the contact centre team can expect to get more calls on a traditionally busy day,” he says. “Better coordination can avoid that. In addition, if the customer service team notices more calls around a particular issue, such as energy bills, then the communications team can send out proactive messaging around it.”

For Causon, organisations that don’t see customer service as being integral to the whole business are making a mistake. “Employee engagement levels, return on investment and profitability improve,” she says. “Customer service is a responsibility for the whole organisation to share. Collaboration can reduce the cost to serve.”

According to The Institute, 64% of customers are willing to spend a little more with a company that they trust and well over three quarters are likely to leave them a positive review and recommend them to family and friends.

Brown of FM says the message is clear to customer service leaders: “Without supporting customers effectively during a period of financial difficulty, the company risks damaging valuable customer relationships and increasing unwanted churn,” he says. “An engaged and well-prepared customer service team is vital.”

Customer service is where businesses fight the most fires, and it acts as the public face of the company to its most fickle clients: customers. It’s also become harder in recent years to handle. When the world moves at the speed of a tweet, it’s increasingly challenging for businesses to meet customer expectations – never mind exceed them.

In an instant, an unhappy customer can become a lightning rod for criticism, using the power of social media to spread bad news about the company. It’s a challenge to meet their needs, says Kajal Vakas, senior manager for claims at LexisNexis Risk Solutions in the UK and Ireland. “Customers want a quick assessment, transparency, optionality, and they have the expectation of a smooth journey,” she says. LexisNexis decides to use data-driven automation to assist. “Injecting data into the claims process could help the market reach a happier medium,” she says.

That’s the insurance industry, but it’s a feasible method to improve any customer issues across all sectors. Six in 10 customers expect personalisation from a brand, and incident and process automation can help give off the impression of the personal touch at scale. It’s also vital to offer personal guidance when things go wrong to smooth over any issues. It’ll benefit businesses and the broader economy, too. One estimate by PwC suggests that using artificial intelligence – powered by big data – will provide a $15 trillion boost to global GDP by the end of the decade.

Ensuring that customer service agents feel empowered to take quick, decisive action – whether it’s fielding a complaint or answering a query – can be aided by automation. Automation can pick out patterns, such as regular points of friction, and build out simple ways to tackle them as they arise. This means agents can spend more time considering the issues they’re faced with and how best to handle them, rather than worrying about who to escalate them to. 

Automation also helps avoid human errors that can be introduced by carrying out repetitive tasks, as it simply does the same thing over and over. Not only do agents have more free time to devote to customers, but they also draw down the risk of doing something wrong along the way.

But it’s not just tackling problems after the fact that automation helps with. Deploying automation in customer service can help smooth potential problems so they don’t arise in the first place.

“Businesses are moving towards automation,” says Matteo Borghi, lecturer in entrepreneurship and innovation at Henley Business School. “It’s not just a matter of efficiency and productivity gains, but should also add value to the final customer.” Borghi has studied the deployment of automated service models in the hospitality sector, and has come up with four or five steps he believes are useful for any business considering implementing automation.

Borghi advises companies to think carefully about their processes and figure out which of them could be easily automated. “We should be aware that we cannot automate everything,” he says. It’s then important to look at the landscape of technology and figure out what’s feasible from the current market in terms of automation. The third step requires reassuring staff that automation is a friend, not an enemy. “We should try to avoid automation anxiety,” he says, pointing out that many staff worry for the future of their jobs in the face of automation.

The fourth and fifth steps require considering what’s appropriate information to collect from and automate for consumers, and whether it follows all legal guidance including GDPR.

However, when embracing automation, it’s important to remember that the solution is a supplement to, rather than a replacement for, the human touch. Automation can help customer service agents do their job quicker and better – but it can’t totally replace them when it comes to interacting with customers. 

“Those who reach out to a customer service agent seek both solutions and empathy,” says Chi Hoang, assistant professor of marketing at ESCP Business School. “While automated customer service, like the use of chatbots, provides faster, standardised solutions, it often fails to meet the customers’ demand for more empathetic and customised services.” 

Hoang points out that there should always be a human in the loop somewhere to reassure and step in if needed. “The availability of human touch, even when customers mostly deal with automated agents, provides customers with a sense of assurance that transforms their experience,” she says.

It hasn’t been easy to raise many smiles this year with war raging in Europe and people struggling to heat their homes as inflation soars.

But it is precisely during these tough times when friendly and supportive customer service agents can make the difference between winning or losing sales. 

“If you are a customer trying to make savings, you may look at which subscriptions to cancel or find cheaper alternatives to your favourite products,” says Kat Gaines, DevOps advocate at US tech group PagerDuty. “If you have an amazing customer-facing team in your organisation which reassures people that you have their back, then that could be a decisive factor in them choosing to keep your business ahead of your competitors.”

According to PagerDuty research, in bad economic times and good, $62bn is lost each year due to poor customer service, with 70% of the buying experience based on how the customer feels they are being treated.

“When your customers have issues with your service, it can make or break their relationship with the brand,” Gaines says. “It is your employees, particularly the customer service team, who influence much of this brand perception. As such, there is an incredibly strong link between employee satisfaction and customer satisfaction. Customer service staff who are happy and fulfilled in their job and have everything they need at their fingertips are going to perform better and make the customer happy.”

Customer service staff who are happy and fulfilled in their job and have everything they need at their fingertips are going to perform better and make the customer happy

She says satisfied employees are motivated to work on issues faster and take those extra little steps to go ‘above and beyond’ for customers. “We all have anecdotes of bad customer service interactions, but we also have good ones as well,” Gaines says. “The benefit for the customer is that they get issues solved faster. This allows the customer to get back to either using your products or buying a new one and adding to your top line.”

Indeed, according to research from customer experience expert Blake Morgan, companies with highly engaged employees outperform the competition by nearly 150% and have 10% stronger customer metrics.

However, despite the benefits, it seems companies aren’t listening. Gallup research states that in the US only 39% of employees consider themselves engaged. 

“Overall, business has a cursory understanding of the employee and customer satisfaction link. We all need to do a little bit better,” says Gaines. “It is easy to look at customer service as the first department when you are considering budget cuts. But you need to fight that instinct. Think of different ways to continue or even double down on investment in customer-serving teams. It is scary in these times but that is what you need to do.” 

She urges businesses to sit down with customer service leaders to determine whether the agents have the technological tools they need to get their jobs done efficiently. Are they treated internally with the authority they need to understand and solve customer issues by themselves? Do they have the right connections within the organisation to get the information they need to help their customer? Could different tools and resources help improve efficiency?

Gaines calls on businesses to create visibility, giving agents access to real-time technical and operational information to help solve customer complaints or concerns. “You should break down silos between departments because the agents often need to get information from other teams,” she explains. 

“If you are an agent for a tech company, you may need to interface with the product and engineering teams and get information on resolving bugs or issues. It can be bothersome if an agent pokes a busy engineering person on the shoulder and asks them for that information straight away. You need to reduce that friction.”

One answer is to use shared tools, such as those offered by PagerDuty, where all teams can access information at the touch of a button. “If something is not going to plan with the product, then your engineering team is already in this shared system looking at the necessary information and diagnosing the problem,” Gaines says. “If the agent can log on to that same system, they can see what the incident is in real-time and chat with the engineering team on that space. They can inform their customer quicker and, if necessary, can be responsible for large-scale communications on the issue to reduce the number of inbound calls.”

Friction can also be reduced by AI technology such as speech analytics, which can determine a customer's mood and improve the call experience for all. Other automated tools such as chatbots can be utilised to handle mundane customer requests such as password resets. 

“Chatbots are not a threat to agents' jobs. They can free up agents who, with more investment in their training, can engage in more complex customer calls, diagnose and resolve issues independently, and spend time building customer loyalty and trust,” Gaines says. “Giving them the technology, authority and cross-team collaboration which can further develop their career pathways will also make them more satisfied.”

Gaines admits that a cultural change in many organisations is also needed. “Too often there is a separation between departments such as engineering and customer support teams, and assumptions are made that customer support teams are not technical staff when in fact they are," she says. “Most of the time it is an unintended bias and when an engineer works closely with the customer agents, for example, they are pleasantly surprised by how technically able they are. They are wildly brilliant people, so in this time when customers really need their help, seize the opportunity and invest in them like never before.”

Find out how PagerDuty can help you optimise your customer service operations

The customer is always right, but when more complex problems arise, the customer can often test a business’s ability to work deftly. Customer complaints or queries rarely fall under the auspices of a single team or individual, meaning that it’s more important than ever that organisations can work together to resolve issues – and quickly. 

Yet companies often aren’t structured in a way that allows this to happen easily. The siloed structure many businesses adopt is one of the biggest threats to customer service and satisfaction. It means that teams struggle to talk to one another about a customer’s issue, slowing down any resolution and jamming up the system. It’s beholden on business leaders – and chief customer officers – to work against silos, and in favour of customers.

“I strongly believe in the power of active communication and integration between teams to provide more innovative and effective work, both internally with team members and stakeholders, and externally with customers,” says Sarah Bernhardi, chief experience officer at Ria Money Transfer.

Business leaders and chief customer officers can encourage collaboration and communication between teams by breaking down barriers and ensuring that anyone within a business can help a customer – and interact with colleagues to tackle any issues that arise. 

“One effective way to ensure seamless collaboration is to create common systems across our company,” says Bernhardi. Doing so avoids those silos that can scupper a company’s ability to quickly and accurately help a customer. “We strive to give all our teams visibility of customers’ ongoing journeys, and of the teams that are supporting this journey, in a visual way. This allows all teams to act more efficiently, and to solve problems for customers quickly and accurately,” she says. 

That integrated model is one that Wendy Harris, head of Europe, Middle East and Africa at revenue intelligence platform Gong also recommends. “Business leaders should feel empowered by technology to encourage collaboration between teams and ensure optimal customer experience,” she says. Too many companies keep their customer-facing teams separate.

Harris points out that sales teams who work to gain new customers and close deals should be working alongside – or at least in the same software and using the same tools as – a company’s customer experience team to ensure continuity of care. “Businesses need to make information available to customer experience teams and sales in real-time to smooth out the customer journey and avoid risking dissatisfaction,” she says. “Collaboration software available to all teams could start the customer satisfaction journey from day one.”

Those handovers between teams are a crucial part of maintaining an integrated, positive customer experience – and anything that runs the risk of customers falling through the cracks can jeopardise a brand’s equity among its customers. 

“Complete, efficient and accurate handoffs from one team to another will ensure customer satisfaction more than anything else,” says Harris. “Customer success managers are normally the people who make or break the customer’s venture with the company. If the customer voice is shared across the company and catalogued forever, customer experience and employee resourcefulness will both be amplified.”

However, an integrated customer experience across teams isn’t something that can just be built and then left to happen. It needs to be nurtured and maintained, and simply providing the technology isn’t sufficient to ensure that happens. “Without a strong company culture in place, none of the above will work,” says Jack Fisher, pre-sales consultant at Nasstar. “The culture needs to be one that encourages collaboration and communication.”

Without collaboration and communication across a company, the best-laid plans can go awry, says Fisher. It means that keeping colleagues abreast of the customer experience can quickly become an afterthought, with obvious negative impacts on those customers’ journeys. “Technology can help with this, particularly real-time communications platforms such as Microsoft Teams,” says Fisher, “but it needs to be backed up by good adoption and change management practices.”

Good management practices include ensuring that teams are working together towards collaborative goals, and that they have knowledge of the whole experience a customer has, even outside their team. While a comprehensive knowledge of every step of the process isn’t necessary, a bird’s eye view is. This empowers agents to advise and reassure customers that any process is in motion, building patience and loyalty along the way. 

That bird’s eye view can be achieved in a number of ways, but Bernhardi has one idea that works especially well for her company – bringing people together. “We encourage putting a face to our teams and giving them hands-on days and experiences to allow them to build cross-team relationships around the office, as we value rapport between peers,” she says.