Bill Price on The Frictionless Organization

He has more than 35 years of experience advising and directing major operations in more than a hundred and sixty companies. He’s the co-author of “The Frictionless Organization: Deliver Great Customer Experiences with Less Effort” and of the bestseller “Best Service is no Service: Your Customer Rules.”

So today, his presentation is based on “The Frictionless Organization: Deliver Great Customer Experiences with Less Effort”. And Bill, you are on.

Bill Price    

Thanks so much. I’m honored and pleased to be joining this collection of authors. I sat in on the last one as well, so it’s fun to learn more from what other speakers and authors are doing. And I hope to convey to everyone today the lessons learned from the book that David Jaffe and I recently published called “The Frictionless Organization.”

And specifically, I’m going to be modifying the subtitle and talking about discovering and removing friction in order to build great customer experiences. So let me just launch forward here with this.

As mentioned, I spent a number of years at Amazon. Before that, I was with a bunch of different companies including MCI Telecommunications, and I spent about five years also working with an AI startup called antuit.ai. So, it’s been an exciting run. Three books over the years, seven years apart as it turns out, and the most recent one is the one I’ll talk about today— about the frictionless organization. Just as a pause, I’ll point out that Driva Solutions, the company that I run here in Seattle, Washington, is part of an 8-country alliance called the Line Bridge Global Alliance. We have offices in the UK, France, Germany, Australia, Singapore, India, and Japan.

So we work collectively and individually in order to do the same sorts of things, which is to improve customer experience while controlling costs. The path to becoming frictionless, or looking at it as a one-page, has nine steps. And what David and I did is we researched companies, we interviewed companies that had a good reputation for delivering great customer experiences. We asked them, well, how do you do it? Give us some inside scoop or at least give us some stories, tell us how you do it. And this is the collection that we came up with, the process of the steps we came up with, and it starts with figuring out what is our focus, what are we trying to do in terms of customer experience and customer support.

And the first one is to understand why customers contact you. And related to that is to assign responsibility and priorities for fixing the problems and for leveraging or exploiting the opportunities.

In the middle box, you see five strategic actions that we found are very important in order to delineate and to move forward with the different solutions.

One is to eliminate stuff that’s broken. Another one is to digitize what are relatively simple applications. Preempting, meaning letting customers know beforehand what needs to be fixed and improved, streamlining solutions, fewer processes, and making things work better. And then also leverage, meaning taking advantage of opportunities that are positive and useful for both the company and the organization. And then the final two steps have to do with the continuous process of learning and redesigning what you do.

There are really six key concepts that I want to leave with you today.

[Interruption due to network issues. Session continues after the glitch]

I was reviewing the six key concepts, and we’re talking about how a customer experience should be a whole-of-business challenge. Everyone’s hand should shoot up. If you ask the question in the organization, “Well, who’s responsible for customer experience here?” It’s really everybody. It’s the groups that create the products, set the pricing strategies, and work on logistics. It’s really the whole organization. It’s not just the customer support team. You need to measure progress using something we call the CPX metric, meaning contacts and cost per X. X being maybe the number of customers, the number of invoices, the number of orders shipped.

So it normalizes the contacts into something that gives you a much better trend analysis. “Eliminate and preempt” create more success than digitizing first, and I’ll talk about that a little bit here.

And the next one is creating the voice of the customer from experiences and from timing rather than relying on surveys. And the final one is to increase first contact resolution and to increase the containment rate in all your digitized channels.

These are really the six main takeaways from the book. I thought that I would just give you a few examples as we go along here.

Why is it so hard, though, to become frictionless? And you see a cartoon here. It’s by a political cartoonist that David Jaffe works with in Australia, John Kadulka, and so we have here six or seven different reasons why it’s hard to become frictionless.

One is that a lot of organizations have legacy systems and channels that just aren’t joined up, meaning the data sources are not joined up with each other.

The second one is a blame game. Customer service gets blamed when really, it’s the other group’s fault. If, for example, the logistics network goes down or if a telecommunication network goes down, it’s not customer service’s fault. If I were to call Xfinity right now, it’s not customer service’s fault that my network went down. It’s something that happened in the network, maybe in my home system here. Don’t know for sure, but it’s not customer service’s fault.

The third one is that you get versions of “We’ve always done it this way.” You know, why is it that we have this type of capability or this process along the way? Well, we’ve always done it this way. Well, that’s really not a good excuse either. A dependence on looking at volumes and averages. One thing we picked up from these organizations we talked to in Australia, Europe, and the United States, in particular, was that they don’t really rely on averages at all. That’s not even a benchmark for them. They look down at the long tails, what are the longest, what are the greatest numbers, what are the shortest, what are the least issues, so they can really figure out what’s going on with their customers who are having the best and the worst experiences. It’s also hard to become frictionless if you do not listen to what customers do not say. We often focus and obsess on what customers are saying to us and what they’re telling us and what we can measure. But what are they not saying to us? Which customers are never reaching out to you for anything? Which customers are not saying the things you want them to say about their experience?

The next last one is short-termism, meaning having shareholder returns and quarterly returns, which obviously a lot of people do talk about. The last one is not being willing or able to dig into root causes, and that’s such a key thing that these companies and organizations told us. Let me just give you three short examples of this, and then I’ll wrap up with a couple of comments at the end.

Step three in the process is to eliminate, and eliminate is, by definition, where organizations figure out if something is really irritating to us and it irritates the organization. Let’s figure out how to eliminate it through the root cause. In this case, we have owners of issues, and some sort of a customer service squad need to get together to figure out what’s going on and come up with some weighted root causes. It’s important to figure out which are the issues that really have the highest volumes and the highest costs. Among these are three examples, such as, “Where’s my stuff?” like, “Where’s my refund? Where’s my product?”, “Why didn’t you get back to me on an issue?” “My X is wrong. We’re no longer working,” such as my network today as you’ve experienced and I’ve experienced, and the other one about, “Well, you told me you were going to do something. You haven’t gotten back to me about it.” And this really creates high repeat contacts, what we call snowballs, and what these companies would prefer as repeat contacts and then very low CPX.

So, an example, which is ironic given my network outage here this morning, is a company called Way Broadband. Their executives got together because customers were complaining that their broadband or TV service wasn’t working, particularly in rural areas. And what they figured out was, well, snowstorms, windstorms, and so forth would knock out power quite often. And customers would call in and say, “You know, I don’t have my broadband. I want this to work.” And someone would go through troubleshooting and try to figure out what’s going on. Maybe they’d have to send out some sort of a technician to figure out what’s going on in the home. They came up with a pretty simple solution, which was to give a surge protector to every home, literally— just to give it out for free. The surge protector might cost the company $10 or something, but it prevented a large percentage of these outages because, at least, the surge protector took care of the surge if there was a problem in the network.

The next example is with Nike, specifically talking about the leverage action, which is where customers and organizations all find value. Both sets find value in these interactions. And here, Nike decided to route all of their avid runners, as they called them at that time, to speak to a shoe engineer at their headquarters in Beaverton, Oregon, instead of dealing with a customer service rep in one of their centers. They call their customer service reps athletes, and these athletes are well-trained and they’re great folks. However, avid runners might often have a very specific set of problems that, in Nike’s case, warranted talking to a shoe engineer and having a really great conversation. And that led to actually creating new products, such as something called the Flyknit shoe that came out several years ago. But more recently, it’s led to an extensive free Nike program called the Nike Membership Program that includes an opportunity to chat with a Nike expert through the Nike app on any issue that you can select. So they created from this leverageable opportunity of avid runners speaking to shoe engineers an entire program that’s become very, very successful for the company.

The third and last one I’ll give you right now is redesign. Redesign is a continuous improvement at the end of the frictionless organization, and we heard from companies such as Zoom. Some of you might not be aware that Zoom actually was partially born or at least conceived inside of Webex when the executive at Webex recommended that there should be a lighter weight video service than Webex had at that time. Webex decided not to do it. He left, got funding, and formed the company Zoom and wound up reinventing, in some senses, the way that video services are provided. And this is an “if it’s not broken, break it” mentality or strategy. An example I give you is my hometown company here, where I worked for a number of years.

Amazon has come up with this Amazon Fresh concept, also called the No-Touch program. I’m not sure how many of you in the audience have experienced it, but it’s really quite amazing. You basically enter the shop, the retail store, the food store, with your credit card, your Amazon card, or your palm scan. You place items into your bag. If you don’t want them, you can put them back on the shelf or on the counters. Then you exit within minutes as soon as you’re done, without talking to anybody, using that same credit card or your palm scan again. There’s an audit, and everything shows up on your Amazon account within minutes after you leave the store. And if you need to return anything— I actually had to return something once to my local Amazon Fresh store, and they said, “Oh well, next time you don’t have to even come back to return something. Just click on the button, the thumbnail image in your orders, and you’ll get an automatic refund.” So, it makes it very simple, very frictionless, so you don’t have to deal with the time and effort that you do at a lot of retail shops.

So, in summary, just four main points about becoming frictionless. It’s well worth investing in data across the channels and in speech and text analytics, which can really come to the rescue here. They’re very successful, and the advances of generative AI, such as ChatGPT, are becoming really exciting for this whole field.

Secondly, it’s a whole-of-business problem. You have to deal with logistics, product design, marketing, not just customer service as a team. These types of data about becoming frictionless can help with Voice of Customer Net Promoter Score, Customer Effort Score, and all the key metrics that you might have and want to improve. Voice of customer data is crucial.

The final point is that digitization is just one strategy. So while we keep hearing “digital first,” what we really recommend, based on research in these companies, is to figure out how to eliminate and preempt first. Those are going to be very successful programs for you.

So I’ve caught up on time here. I hope I covered everything in the program. I would love to take any questions or comments from the audience, and if there’s time, I can even give you more examples.

Subhanjan Sarkar    

That’s awesome. We’ll give the audience a couple of minutes to ask any questions if they have. I mean, there’s a lot to digest, and I guess, in fact, one of the things that I mentioned when I started this event today was that one of the objectives was to make it short and make it dense because I mean, we can obviously make it very long. And I’m very fascinated with the TED Talk format, you know? Well, so I think a lot can be done within 18-20 minutes, and it’s the challenge. And so far, I must say, it’s working very well. Good.

Bill Price    

I would say, well, I think it’s important to make things simple. That way, it’s dense. I like the concept of density, but making it simple is important because everything is so complicated in businesses.

So I see a question from the chat.

The question is, “With tools such as ChatGPT and chatbots become ubiquitous, what’s your suggestion for the first line of contact when a customer reaches out?”

Okay, so most customers wind up looking at your website or an app first. So the first line of contact, the first line of interaction, and for information gathering or for resolving a problem should be on the website or on an app. And when, because most of us, the statistic is something like 89-90% of us go to a website or app first. We don’t really look for a phone number or look for what would become a chat, a chatbot interaction. So the chatbot typically comes second or maybe even third. So I would go first on an app or a website, and then I would have relatively simple information on the app or website, that would try to coax out of the customer what the issue is, and then maybe you can do it in context. You can figure if it’s a new customer, for example, maybe they’re going to be asking about usage. If it’s a customer who’s been around for a number of years, maybe they’re going to ask about reupping their service or something that may have gone wrong with their service. And then I would look at the chatbot, whether it’s ChatGPT or other functionality, as a secondary contact.

Subhanjan Sarkar    

Great, good. I think that was an interesting question.

Bill Price    

Is there a way to measure friction?

The main way to measure friction is to look at this CPX that I touched on very briefly— contacts per X.

So let me just give you a little more on that.

The Amazon version of that when I was there a number of years ago was contacts per order shipped. And when contacts per order shipped— the total number of contacts that are handled by assisted support agents, not automated solutions, but assisted support. If contacts per order shipped in total went up, that was actually not a good thing because it suggested that there were problems and friction. Then you break down the contacts per order shipped, CPX, that metric down by the individual reason. So if one of those reasons was “Where’s my stuff?” meaning something wasn’t delivered on time, if that particular reason CPX was going up, then definitely that’s a mark of friction. And you need to look at not just the overall number of CPX, but actually what the individual reasons are. And if some of those reasons are going up, then you see that there is a really strong example of friction.

Subhanjan Sarkar    

Great, I think both the questions were pretty on point and sort of helped you elaborate a bit more on what you had talked about, right?

Okay. So I’ll just check if there is one more. Ok. I think we are good.

Bill Price    

Okay.

Subhanjan Sarkar 

Thanks Bill, thank you very much. I know we had some friction.

Bill Price    

We did, but we got through it. We got through it in the end.

Subhanjan Sarkar    

Absolutely. So, this is the link to get the book. Please feel free to click it. It will take you to the store where you can get the book. Okay, it’s a book you need to read. And actually, if you read this, my bet is that you’re going to go back and read his other two books as well because

I mean unfortunately, we are focused on sales. In fact, one of the authors spoke about how ensuring that post-purchase delivery of whatever you actually sold becomes a key to the organization’s success, right? I mean, somehow in our head, sales and marketing ends with the customer coming and paying us some money and buying something. That’s not true at all. I think we need to understand that it’s all one continuous— marketing, sales, customer deliverability, so on, whatever they are. They are not really silos that you would like to believe. In fact, I was talking to somebody who has worked in IBM for like 20 years, and she was saying that no, for us, once we did the sale, I don’t want any of it. I’m walking away, you know. I mean, I can understand that, but I understand that that mindset needs to change in today’s context, right?

Bill Price 

Well, and all of us run into issues, problems, questions, concerns, friction. And when there is a great experience afterwards, then it does lead to repurchase, telling your friends about the product and service. I mean, you’ve got to think about that Nike membership program I touched on during the slides. That’s led to a lot of great loyalty at Nike as well. So that’s what you want to strive to produce.

Subhanjan Sarkar    

Bill, thank you so much. Thank you, guys. We will be back in a minute with Diane Helbig. Just stick around, more stuff is coming. See you.

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