As Europe’s economic fortunes plummet, effective management of your service business becomes integral to ensuring profit. Amidst increased pressure to deliver a mature service capability, the financial status quo provides the opportunity to review your modus operandi and embrace powerful new incentives to enact a total service transformation. Without good leadership however, new initiatives tend to veer off track. Leadership is, more often than not, the major differentiating factor in a company’s level of success. The question becomes: What makes a successful leader in the services and how do you lead your company to profitable growth? At Noventum, our consultants have defined four priorities to first-rate service leadership; a good Strategy, focus on the Customer Experience, attention to the virtues of (what we call) the Service Factory, and developing your Employees’ skills and understanding. These considerations will be addressed in the upcoming Service Management Conference and through our executive Service Leadership Course.

HR departments have been forced to focus in recent years on downsizing or rightsizing the workforce, often resulting in the creation of un-balanced teams.  More importantly, the change and development of technology has meant that the skill sets of many of the teams are inadequately aligned to the needs of very demanding customers, and businesses trying to reduce costs while improving levels of performance.

Attention is now required on rebuilding the business (people, processes and technology combined), transforming the operation to facilitate the introduction of low-cost service delivery models, reduce costs and improve service levels.  The type and skills of staff now required are subtly different from previous recruitment criteria, requiring to be IT and software  literate as well as display electromechanical skills to deal with high tech devices.  On top of these technical skills is the need for a higher level of empathy towards the customer, to help solve their problems.

Successful operations set about accomplishing this steep learning curve by ensuring education and staff development and providing an integral staged learning programme.  The intention is to gradually build the skill set as the user grows.  Imagine a system that can recognise a novice seeking information, who is able to benefit from a graduated information output and develop towards more sophisticated requirements, and also recognise when the user has become expert and is ready to add value and learning to the total application.  Optimisation is about achieving a balanced position: and therefore it is important to understand optimisation, what it means for each business and how it can be achieved and measured. 

The current rapidly changing environment demands much greater reliance on the quality and calibre of individuals for example  developing engineers as trusted advisors; beyond requiring that they adapt to technology and activity management, and the expectation that mobile solutions will provide effective command and control to support structure and processes.  Managing activities is important when productivity and cost reduction are in focus, and strong leadership will be necessary to ensure that, delivery of leading-edge service achieves all its objectives across a wide range of measures to include customer loyalty, engineer loyalty, process quality and deployment, as well as cost constraints.

A significant challenge for many service organisations is to improve the capability of their managers and staff; this is not simply a training issue, and acknowledging a lack of capability does not necessarily reflect poor or limited training, but is a more complex issue which companies are having to get to terms with in order to grow cost-effectively while retaining existing and seeking out new customers.

Change in the environment has required much more reliance on the quality and calibre of the individual, for example the focus on development of engineers beyond adapting to technology and activity management, and instead using processes and structure to support effective command and control. Managing the activities is important when the focus is on productivity and cost reduction, but leadership is required to ensure that delivery of leading-edge service achieves all its objectives and is effective across a whole raft of measures including customer loyalty, engineer loyalty, process quality and deployment, as well as cost constraints imposed by a changing environment.

Managing at a distance is usually accompanied by the concern that staff left to their own devices will not be productive. This very thinking might be at the core of the concern – creating a self-fulfilling prophecy. If a problem arises, the immediate response can be to infer blame, and demand that a solution be implemented to fix the problem; in other words, we prefer to fix the problem (short term) by controlling the people, rather than work with them to come up with ideas, tools and techniques which will control the process and fix the problem (long term). Leadership requires working with staff to control the process, not railroading or mandating a solution.

Steve Downton has established a reputation for providing effective business advice within the Services Sector specialising in guiding senior management teams and supporting service operations both large and small to improve their performance profitability and deliver service excellence. He is one of the trainers together with other senior consultants at Noventum Service Management, who will further explore this successful guide to service transformation and brand enhancement; at the Service Leadership Course. You will explore why strategy, customer centricity, service factory and employee development are crucial in Service Leadership, and to profitable growth.

The importance of Effective Leadership in achieving success

Service Leadership issues seem to have been largely ignored, as changes have taken place in the running of service operations over the last 5 years; specifically the way operations and staff are managed. Technology may have vastly improved the ability to manage, but except for a few enlightened cases where the resolution of these issues has brought significant success, but still the ability of the leadership/management will determine how successful the operation is.

Defining something as complex and elusive as leadership risks the possibility of being open to the criticism that some aspects have been left out. The difficulty here lies in identifying where management ends and leadership begins.

Effective leaders can make a big difference to any operation within the business, and in the service operation, where success is measured on profitability, customer loyalty and cost effectiveness, it is inevitable that links be made to the personal effectiveness (leadership) of the manager in charge. This is not to say that leadership is a more effective form of management; the two are different, leaders and managers do different things.

The importance of Effective Leadership in achieving success

Service Leadership issues seem to have been largely ignored, as changes have taken place in the running of service operations over the last 5 years; specifically the way operations and staff are managed. Technology may have vastly improved the ability to manage, but except for a few enlightened cases where the resolution of these issues has brought significant success, but still the ability of the leadership/management will determine how successful the operation is.

Defining something as complex and elusive as leadership risks the possibility of being open to the criticism that some aspects have been left out. The difficulty here lies in identifying where management ends and leadership begins.

Effective leaders can make a big difference to any operation within the business, and in the service operation, where success is measured on profitability, customer loyalty and cost effectiveness, it is inevitable that links be made to the personal effectiveness (leadership) of the manager in charge. This is not to say that leadership is a more effective form of management; the two are different, leaders and managers do different things.

Ideally, managers have both administrative competence and leadership capability – however this combination is rare. Generally, it is easier for a leader to find an administratively competent manager to backfill their deficiencies than it is to find a genuine leader to support an administrator.

By completing the sample assessment you grasp a flavour of the questions raised in the full assessment that are designed to highlight the skills of front-line staff; key aspects of the trusted advisor skills in understanding the problem, the customer, the solutions available and the capability of fully explaining the answers to the customer. The questions asked in the sample assessment are from a larger set of questions that provides a full assessment. It scores the qualities of your most valued personnel (Elite Group) and the average performance of the rest of your personnel.&nbs

In the new economy brought about by the recession, caution and value for money are now key criteria in making decisions, and the most successful business strategies have to deliver a strong service-based brand provided by high-calibre staff at all customer interface points. Companies are developing the necessary skills in their personnel to demonstrate to their customers the focus on delivering high value service across the business. Performance data powerfully demonstrates how successful these companies have been when applying these principles advancing people and brand-driven service strategies:

• Companies originally providing complex technology, with limited service offerings based on break/fix, are now experiencing growth rates of 20% to 40% by offering high value-adding services (identified by building close relationships and gaining much better insight into customer needs)

• Standardising service organisations to produce high quality consistent processes able to deliver 20% or more in customer-shared cost savings the first year, with 10% or more further annual productivity improvements

• Proactive service process management aimed at identifying reasons for failures ultimately offering prediction/prevention rather than just continuing to react to symptoms (potentially promoting greater customer loyalty and increased share of customer wallet in return for the investment)

• Broadening the skill of customer interface personnel through investing in service competency development (such as the trusted advisor) has proven to deliver 20% annual revenue growth rates, as loyalty amongst the customers grows

Successfully delivering service as a Brand-driven strategy, based on the calibre of the customer interface staff requires a significant rethink of the process model. In addition, in the current climate, a shortage of staff with the requisite skills to provide effective customer support (front or back office) has meant that many companies are struggling to deliver to new customer demands.

The shortage has many causes including slashed training budgets, forced head reductions and minimal recruitment. None of these issues will vanish in the short term, so the challenge is how to overcome these limitations and turn adversity into a positive outcome.