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Create A ‘Service Profit Chain’ To Help Performance In These Interesting Times

There is no doubt that the vast majority of Australian businesses are operating in interesting times.  There are number of factors at play.

To navigate through this ‘maze’ of uncertainties, businesses need to embrace strategies to develop a ‘healthy and engaged workforce’, which will encourage ‘loyal customers’, and should result in a healthy bottom line – a service profit chain’ (a term originally coined by Harvard Business School in the 1990’s).

The challenges that business owners need to face are:

  • What experiences do you want your customers to have when they do business with you?
  • What type of culture are your customers going to encounter when they do business with you?
  • What are your business’ goals?
  • What’s the philosophy of why you are in business?

This will undoubtedly lead you to the development of people.

To be successful in business, you need to develop capable people.  Attention to the development of capable people will lead to productivity improvements.  Greater satisfaction and team loyalty will then contribute to the profitability of the business.

The other big benefit is, that this will lead to, greater customer service and customer satisfaction.  An investment in people to deliver greater services will result in business improvement.












Where do you start? 

  • What do you want your customers to experience when they deal with your business?
  • What type of culture exists within your business?

From a team member’s point of view, culture is about:

  • management style;
  • team work;
  • support and development of team
  • developing pride in what is achieved within your business; and
  • an appropriate behaviour must be experienced at every level (from the most junior team member to the most senior classification).

Consideration needs to be given to rewards, but rewards are not all monetary. In many cases, an appropriate reward can be acknowledgement and recognition of a job well done and, ultimately, allowing the team members to participate in the fruits of the enterprise, thus creating an overall sharing in the benefits of the organisation’s success.

  • How will these strategies show themselves?
  • Team members will solve problems.
  • Creating ideas should lead to greater innovation within the business.
  • Team members should not be scared to take the initiative and go the extra mile to solve customers’ problems.

The effect of these activities will be shown in customer surveys, the business’ results and, ultimately, in the bottom line. This will contribute to a better retention rate and a more inclusive culture within the business.







How should you go about implementing this?

  • Empower front-line people to fix the problem without having to refer complaints or suggestions from customers further up the line.
  • Why not have a policy of ‘just fix it’?
  • Some organisations are using technology to add value to their customers’ experiences by creating activities, such as ‘chat facilities’, to hear about and solve customers’ problems.
  • Drive positive behaviour in team members by being absolutely clear on the purpose of the business.

What doesn’t work?

  • People not being appreciated.
  • Insufficient communication, especially to the front-line team members.
  • Inappropriate behaviour at various levels, senior levels in particular.

The ‘service profit chain’s’ ultimate goal is customer loyalty.

Loyal customers think differently about an organisation, because there is now commitment to a brand.  This can lead to referrals to other potential customers.  In many cases, loyal customers are easier to deal with, and price is not a factor to them.  Loyal customers have already decided that they want your product and or services, as long as the prices are fair

From a business’ point of view, it’s how you add value and how your customers enjoy doing business with you that leads to businesses gaining loyal customers.

What can you do to develop loyal customers?

  • Have discussions within your organisation.
  • Consider, what are the differences between your various customers?
  • Find out what your customers complain about?
  • How can the items, that they’re complaining about, be fixed?
  • Are there follow-up phone calls after a job is completed? How do you know if you did well or you didn’t do well?
  • Are customers encouraged to make comment?
  • What internal goals need to be set relative to dealing with customers?
  • Create key performance indicators and measure KPIs, as appropriate, on a daily, weekly and monthly basis.
  • Encourage success by rewarding positive behaviours within the team.
  • Encourage and lead the workforce to build customer loyalty.

Ultimately, all of these activities will benefit the business’ overall performance and improve the bottom line profitability of the business.  There is no doubt that there are tough economic times at present.  In tough times, businesses need to utilise all of the resources they can gather to ensure that the business is successful.  This will keep your team in jobs and provide a great service to your customers.

Now is the time for a complete review of your business activities to see where the improvements need to be made, with particular emphasis on these two key areas.  Happy, engaged workforce and happy loyal customers lead to bottom line success.

We work through all of the above in detail at the Global Business Camp event coming up from the 17th to the 19th of October 2022. You should be considering coming along with as many of your key team as possible and working on your business for the 3 days.

Find out more – www.globalbusinesscamps.com.au

Register and receive VIP rates by using this special code and entering that in the coupon code are of the registration form – “SMITHINKMEM”. Full rate is $3,300 pp but VIP rates are ONLY $1,980 pp. This could well be the best investment you make for your business. Also, pay before 30 June and get a 100% tax deduction in your 2022 tax.

Registration link –  https://globalbusinesscamps.com.au/register-now/