Edition: October 2005 - Vol 13 Number 10
Regardless of your company’s size, market or geography, your customers want just one thing: They want to be taken care of. They want ongoing assurance that your company has their best interests at heart. And your customer service reps are an important part of the equation.
Recently, Repertoire spoke with three distribution executives about great customer service: Mike Orscheln, VP and general manager, ambulatory care, Medical Products and Services group of Cardinal Health; Janet Pond, VP of customer service, McKesson Medical-Surgical; and Brad Hilton, senior VP of operations for PSS World Medical.
Not surprisingly, no two distributors approach customer service exactly the same. That’s because of the existing differences among these companies, as well as the wide variety of customers’ needs and problems. Some similarities do exist in their approaches.
For example, they don’t expect their customer service reps to be sales reps. However, they do expect them to be aware of specials and promotions, and they train them to advise customers on potential product opportunities, particularly in lower tech areas. Second, they expect their customer service reps to service two sets of customers with equal enthusiasm: outside customers and inside customers (including sales reps). And third, they agree that great customer service reps alert customers to potential problems before they occur.
According to Orscheln, most customers don’t care who solves their problem, just so long as someone does. “In many cases, they don’t care if it’s a customer service rep, sales rep or collections rep,” he says. “It’s a matter of, ‘I have an issue; you’re with Cardinal Health; solve it.’” Given that customer service reps are in close and frequent contact with their customers, it is they who most often field the phone calls.
The company has two main teams: one that supports the field sales reps, and another that supports the inside telesales reps. Orscheln says either team actively promotes or sells products. However, “They are highly responsive to the needs of customers, and they will offer relevant [product] alternatives based on the issue, opportunity or challenge,” he says.
Like all distributors, Cardinal Health won’t dictate how customers should use the customer service team. “It gets back to their individual needs,” says Orscheln. Some customers are happy calling in to a group of customer service reps and speaking with any one of them. Others, however, want to speak to “their” reps and their reps only.
“I’ve been in this industry almost 25 years, and one thing that has always been inspiring to me is the role that the customer service team plays,” says Orscheln. “They are there to serve the customer; that’s all they do, all day long.” Cardinal Health does its best to hire people who will do so with enthusiasm and genuine empathy.
Prior to hiring someone, the company questions whether the candidate’s values align with those of Cardinal Health, and whether he has that certain personality needed to succeed in customer service.
“It takes a unique individual to deal with the pressure from a customer who needs something today that didn’t show up in the shipment,” says Orscheln. “So, first and foremost, we look for the skill sets and the personality.”
The company reinforces those skill sets through online and face-to-face training at the distribution centers. When possible, customer service reps attend industry shows, such as the HIDA Expo. And, manufacturers often visit the centers to demonstrate new or existing products. The customer service reps learn about ongoing promotions and product initiatives, so they are in alignment with the field sales force.
The company does its best to measure the customer service teams’ enthusiasm and effectiveness. And it starts at the most logical point: the customer. Customers are surveyed about their satisfaction with the service they receive, whether it is from the standpoint of customer service, sales or distribution. “We look at it as an integrated service team,” says Orscheln. “Everyone is a piece of it: the sales rep, customer service rep and the person who picks, packs and ships.”
In some cases, the research is conducted “blindly,” that is, the customer doesn’t know that Cardinal Health is asking the questions. Other times, the company asks callers to hang on for a few extra minutes after placing their orders to answer some survey questions over the phone.
Supervisors periodically listen in on customer service reps’ phone calls and offer tips for improvement. What’s more, Cardinal Health tries to establish quantitative measures of its customer service reps’ performances, including the number of phone calls they handle, the average time it takes to resolve problems, effectiveness in solving problems and so on.
Like Cardinal, PSS considers its customer service reps to be key touch points for its customers, along with the field sales force and the company’s drivers. PSS takes a decentralized approach to all three, meaning all are stationed at the local distribution centers. “Our local leaders have all the tools [they need] to make sure we take care of local customer needs and trends, and to help us grow our business,” says Hilton.
PSS’ goal for its customer service teams is simple: to serve the company’s internal customers (i.e., sales reps) and external ones. To monitor their performances, the company tracks key indicators, such as call volume, activity per hour and so on. But also it tracks qualitative data. For example, “secret shoppers” call the distribution center and score the customer service rep on such things as how long it took him to answer the phone and his level of politeness.
The company also surveys its field sales reps. “We ask them how we’re doing, not just in customer service, but in purchasing and accounts receivable,” says Hilton. The sales reps give their opinions not only on how they view the company’s performance in these areas, but also how they think their customers view it.
PSS’ customer service reps are on hand to take calls from customers and sales reps. But the company expects them to be proactive as well. “Our customer service reps help in generating leads for pharmaceutical products and equipment,” Hilton says. “When they have the customers on the phone, they ask probing questions, trying to pre-qualify leads.” Customer service reps are also expected to up-sell or cross-sell commodity-type products, such as table paper and cotton tip applicators.
Another way the customer service reps are encouraged to be proactive is by alerting customers to potential problems. “We try to call the customers before they know they have a problem,” says Hilton. So, a rep might notify a customer that the delivery truck is stuck in traffic and that delivery could be delayed a couple of hours. “Then we ask, ‘Is that a problem? Should we send out a courier?’”
PSS has developed a combination of mentoring and training to keep its customer service reps sharp. The company has a national trainer, who develops programs for the entire company. But the programs are executed on a local basis through what PSS calls its Key Club. Representatives from customer service attend all local and national sales meetings, so the team knows what products the company will focus on in the immediate future.
At PSS, customer service reps are expected to develop product-training classes themselves for their colleagues at the branch. That means calling up the manufacturer, learning about its products, and then making a presentation to their peers. “They develop confidence and figure out how to present information,” says Hilton.
The customer service reps also ride along with field reps to gain first-hand knowledge of the customers and their environments. Hilton says spending a day in the car with the sales rep helps the customer service rep know the customers and their needs, as well as the sales rep with whom they work.
Compensating and incentivizing customer service reps can be an inexact science. “Here’s the challenge: We’re focused on quality, and that’s difficult to [assign] an exact score to,” Hilton says. “It’s difficult to measure the quality of a call. Really, it’s a one-on-one interaction, and you’re trying to interpret [thousands] of phone conversations with customers.”
In addition to his base pay, the average PSS customer service rep earned $2,400 in bonuses last year. Some of that money is generated when a lead results in a sale, and some is tied to branch programs based on customer satisfaction and loyalty.
McKesson Medical-Surgical has 11 customer service locations, 10 dedicated to the company’s acute care and primary care customers, and two servicing its long-term care and home care customers.
For McKesson, “Customer service starts with understanding first and then exceeding the needs of the customer during every interaction, regardless of the contact method: phone, mail, e-mail, chat,” says Pond.
The company monitors the performance of its customer service team closely. A percentage of each rep’s calls is monitored on a monthly basis. “With the data collected on these calls, the quality assurance coordinator and supervisor can coach for improvement and acknowledge quality performance of the CSR on a routine basis,” says Pond. In the near future, McKesson will implement a customer satisfaction index score for each of its locations. It will do so by making outbound calls to customers in order to gather feedback for certain categories of customer satisfaction.
Pond believes that it’s a mistake to treat customer service strictly as a reactive exercise. “The most successful customer service teams recognize that being proactive with the customer will promote improved service,” she says. “For example, if you have a problem resolution in the works, and you are proactive in asking questions that require more than a ‘yes’ or ‘no’ answer, you can gain a great deal of information to prevent problems in the future.
“I believe that customer service must assume a ‘prevention’ (proactive) mode of thinking, rather than ‘fire-fighting’ (reactive), to gain competitive immunity in the industry,” she says.
Pond says training sessions and incentive plans help maintain the quality of the company’s customer service reps’ performances. Reps receive incentive pay for performing above expected levels of performance. And that raises the bar for everyone.
“By setting a standard of performance, I believe the drive to perform above that level is individual and can be contagious,” she says. “When one customer service rep overhears another talking about the ‘extra’ money in his check for the quarter, this can motivate others to perform above expected levels, and everyone wins - the CSR and the customer!”