This new year, let's make a resolution. Let's rediscover the service ethos. I don't mean the formulaic, often insincere kind of service typified by parting phrases like, "Thank you for calling us, have a nice day". I mean real, engaged service delivered by one human being to another.
After all, everyone is saying that the IT industry should stop being so product-focussed and become more service-centric. But there's a problem. To most technology companies, adding a service element means hiring a bunch of project consultants. They see service as just another product line, to be packaged and sold, and then you move on to the next customer.
That's not what I mean by service. It's not just another product to be priced up and added to the portfolio. Service is something that reputable businesses give — not sell — to their customers. Instead of seeing customer service as a revenue opportunity, they see it as a customer satisfaction opportunity. It won't bring instant profits, but it does build lasting customer relationships.
Unfortunately, that's not the way companies think these days. A few years ago, it used to be a nice touch for a business hotel to provide bathrobes for their guests, and to send a maid round in the early evening to turn down the bedclothes. That was good service. Now, it's a premium option that costs you an extra thirty dollars a night. These days, service comes at a price, and even a warm welcome costs you extra.
The trouble began when companies started applying product-marketing disciplines to service offerings, designed to squeeze every last penny of profitability out of every single activity. Companies analyzed the various service elements they provided, and broke them down into repeatable processes that could be costed and valued on a corporate scale. Finally, they repackaged, priced and marketed them as if they were products. The ungainly word used to describe this transformation is productisation.
Unfortunately, productisation treats service delivery as an assembly-line process in which the customer is just another stage. Founded on the mechanistic principles of the industrìal age, it regards customers as passive consumers — homogenised, indiscriminate recipients of predetermined, batch-produced service packages.
The sad consequences of this approach become all too apparent when businesses try to productise complex services, such as house conveyancing, small business banking or the delivery of technology solutions. It works OK so long as nothing untoward happens, but the system rapidly breaks down if no provision's been made to cope with exceptions, and at a stroke the illusion of a satisfactory service is wiped out for ever.
These all too frequent breakdowns are a telling sign that it's time to end the ceaseless quest for productisation. Instead we must seek out ways to reinject a proper service dimension into our soullessly packaged product and service portfolios. We must recommence their service-isation.
It may be as ungainly a word as the one it is intended to replace, but I've chosen it to emphasise the contrast between the two. Servicisation means pulling back from a product mentality that regards every customer engagement as an opportunity to make a sale, and every sale as a separate project with its own profit and loss account that closes once the item's been delivered.
It substitutes a sense of a continuing relationship with the customer, within which the supplier provides only those products and chargeable services that serve the customer's interests. It means never making a profit at the customer's expense, but making profits only when the customer will benefit.
It sounds altruistic, but it's founded on the hard-headed reality that, as soon as you start putting a price on service, it begins to diminish in value. Customers don't want service that's based solely on a keenly calculated profit motive. They're rightly suspicious of businesses whose sole mission in life is to sell them something else.
The problem is that this is precisely what businesses have been schooled to do in recent years, a time when making a quick buck has been elevated above all other motivations, and greed for financial enrichment seemed to be the only socially respected justification for being in business.
Some companies have even twisted early attempts at servicisation into a justification for raising their prices, reasoning that since service is a value-add, turning products into services justifies them in charging more. The example that leaps to mind is Microsoft, which caused a furore last year when it proposed increasing its enterprise licensing revenues, simply by introducing a subscription-based licensing service to replace its Select volume purchasing program.
Microsoft's difficulties are shared by most companies for whom the product mindset has become ingrained. All too often, technology has been seen as something to be shipped to the customer and then let them sort it out. Even professional services contracts are subject to the same ship-it-and-run mentality. But in an age where the Internet allows technology companies to stay in permanent, 24/7 contact with their customers, there's an emerging trend towards the provision of computing in a continuous service relationship. An ethos of lifetime partnership is replacing the casual sales encounters of yore.
The profit motive alone is not enough to sustain these more enduring relationships. Servicisation means rediscovering proactive, respectful, concerned service, and reintroducing values such as altruism and decency into customer relationships.
We may not get rich quick any more in this new era, but at least we can start making honest profits again.
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