Change management

Why is change management important in service design?
Service design related innovations always lead to major or minor changes in business processes, organization, understanding.


A: conducts services and support processes improvements: (portfolio) analysis, assessment of business potential, choice of change routes
B: analyzes and selects the optimal change process (customer navigation, organizational management, client communication models etc.)
C: manages change projects

Customer has changed


Smart devices online access to information has changed customer and definitely has certain and strong influence to human behaviour, business and society. This change allow us and our customers to be more smart, safe, monitor over lives and … have more fun in life :)

Well-known radio DJ told a story: he was looking for a cat toilet. He went to his regular Pet Supplies Store in the super market. He was busy and actually cat toilet was not the world’s most important object for him. This particular cat toilet he wished was not available in his regular Pet Store he was used for years. Store assistant said „you could come and check next week again….“ Radio DJ turned around and went to the neighbouring Pet Store – just for checking. This type of cat toilet was not available also there, but … the assistant recommended to pick together from e-store in his computer the desired model, make the purchase and the cat toilet will arrive by tomorrow to customer’s home. So they did. And … the customer did not ask for the price as most important thing and he will use the same e-store for next purchases for his cat. Because it is really quick, very convenient and has caring attitude from a sellers side. 

CUSTOMER EXPERIENCE management is one of the main business drivers today

Change is always uncomfortable – entering to the unknown area, lots of work, some mistakes, risks to failure… BUT there is no possibility to ignore the change – unless we want to be out from business.

NB! Opening access to data of both parties, us and customers has also risks to be kept in mind like data security, cyber security, information abundance. This is important to be considered as could impact customer trust towards our product significantly.

Customer support in IoT era

I participated in June 2016  in Athens “Customer Contact Europe”. This annual conference was arranged  by Frost&Sullivan Executive MindXchange

Subject of my presentation

How smart

The main thrust and focus

Rapid shifts in technology and social media are impacting today customer behavior and therefore the way businesses are to be run. The economic importance is shifting from product to customer relationship, which in turn has strong effect to service provider strategy, set-up and processes.  It is inevitable to create in smart customer relations the skills and ability to follow rapid customer evolution – proactivity, increased knowledge standards, web solutions, communication in social media, enterprise transparency and speed

Specific take-aways

– Success factors of IoT, smart customer relations management

– Best practices as well as pitfalls of managing customer experience

– Example of how enhanced experience management has positive impact on enterprise financial results

Creating new knowledge

In one of our earlier post we wrote about knowledge management and it includes sharing knowledge and also creating new knowledge. And now we have to ask how to create new knowledge in the enterprise?

In recent years, scientists have challenged the ability to create new knowledge and to use it, which is one of the most important sources of competitive advantage. In a world where markets, products, technologies, competition, regulations, and the whole society changes extremely fast, continuous innovations where knowledge is growing has becoming an important source of competitive advantage.

Between implicit (implicit knowledge of the human unconscious knowledge, which is the result of past experience, and that is difficult to put it into words) and explicit knowledge (explicit knowledge is easily expressed and thus quickly shared between people and organizations, using a variety of options, such as formulas, manuals and records) we have four main steps, which can be considered as phases of knowledge creation in the organisation:

  1. Socialization – one individual shares implicit knowledge with the other . . . socialisation alone is quite limited knowledge creation process. Granted, the student learns from the tutor. Neither the tutor nor student will get systematic review how the knowledge was created, because their knowledge didn’t become open, so this method is not used in a large organization as a whole. Companies use the same principle for on-the-job-training. Thus, the principal method of acquisition of implicit knowledge is experience.
  2. Sharing – in this phase implicit knowledge is put into word, so the knowledge will become explicit. This is the most typical knowledge creation process in firms; the implicit knowledge is converted explicit through metaphors, analogy, concepts, hypothesis or model.
  3. Combining – is the process where knowledge is systematized in knowledge management systems. This phase conversion involves combining different explicit knowledge. Individuals exchange and combine knowledge through documents, meetings, telephone, or computers, social networking sites. Existing explicit knowledge is transferred through sorting, adding, combining and categorizing, this may lead to creating new knowledge.
  4. Internalization – in this phase explicit knowledge is transformed implicit through learning. When the experiences through socialisation, sharing and combining are attached to an individual knowledge base, then the implicit knowledge will become more valuable. Moreover, if the new knowledge revealed to be shared across the organization, other employees will learn it, which means that they use the explicit knowledge to expand, develop, and shape their implicit knowledge . . . Employees use innovation, which will eventually become part of the process for granted.

To stay competitive, companies must efficiently and skilfully create, find, grab and share knowledge inside the organization. Many companies are so complex that their knowledge is fragmented, difficult to find and therefore sharing the knowledge is inconsistent, irrelevant, and ignored in the decision-making processes, that affect the business.

Business Transformation in Near Future

IBM CEO Predicts The Future Of Business

Rapid shifts in technology, outburst of social media will impact substantially the way businesses are run tomorrow.

Individual  approach – More and varied input of managers, colleagues and customers on each employee’s performance may create more objective pay models.

Consumer Segments Will Cede To The Individual – Rather than meeting the needs of different consumer segments (e.g. geographic, age, income) businesses will be able to truly serve the individual based on specific needs and desires. “What you will see with rapid data and social sharing is the death of the average and the era of you,” “It’s about a dialogue” with each individual understanding her/him, not about just handling the script any longer.

“At the end of the day, it’s about mindset and culture” – Just because the technology exists and will become increasingly accurate, the shift will require new ways of thinking in business management.

The Social Network Will Drive Value –  In the near future “your value will not be what you know, but what you share.”

Data Analytics Will Revolutionize Decision-Making – Data will be the basis of competitive advantage going forward, calling it the “the next natural resource.” Decisions will be based on predictive elements versus gut instincts compared today when judgments are still based on anchoring biases – leaders and managers interpret information through the lens of their subjective perspective and set of experiences.


Relations as the basis of enterprise strategy

Enterprise strategy management can be described via 3 development stages: focus on product, customer or relations.

Relations as the basis of enterprise strategy

Which strategy would ensure sustainability, depends on environment: economical situation, competition, and increasingly the capability to evaluate the development of society and skill to go along.

4 possible relations focused models of strategy  

1.Shared Value =  society & business
–creating long-term competitive advantages by engaging with societies in deeper level e.g. fair trade
2.Platform/standard based = platform owner, partners & customer
–i.e. software producers or telecom providers provide free platforms, solutions for creating wide basis for new developments, new applications or increase other services usage
3.Co-created = Customer & company
–the businesses rely on customers to create meaning for the frame, platform they are providing customers with (Warcraft, Facebook, Habbo Hotel, LinkedIn etc) where a company provide customers a platform for communications, social interaction and fun. Each party at these platforms act selfishly and use the opportunity of
a)great communication platform as a customer
b)great reach and dialogue opportunities as an advertiser
c)enjoy the scale and free value creation by users and advertisers enabling commercial success as a platform owner
4.Coalition = Several companies/ products & customer
–to join forces and relationships of several companies/ products in to one single offering in order to enable stronger hold of customers in variety of different contexts and also offer higher reward for buying from this coalition as well to ease customer choice
–spread current customer relationship and tie it to new partners enabling effective cross selling operation and increase in sales for all partners/ products resulting a tool for market growth in all participating partner categories

Customers’ changed expectations for service companies

how to achieve higher levels of customer satisfaction and at the same time increasing the labor cost efficiency?

To stay competitive companies have realized, that service quality and customer satisfaction are becoming more important. In service quality and customer satisfaction one of the most important factor is now the amount of right information given to the clients ie the amount of knowledge to be shared.

However, it is vital for companies in the current economic situation to improve the efficiency of the labor costs … and keep the quality high which is often resource intensive. Therefore these two objectives see to be  quite opposite, There is a solution that could contain the answer to both – knowledge management.

complex-task-sdoor15Knowledge management is a complex, multi-layered concept with many meanings, however, most experts agree that this is a systematic management of knowledge in order to achieve economic benefits.

Specifically said, knowledge management  is the process that includes organizational learning, knowledge creation and sharing knowledge in special databases (Knowledge Base) and in trainings and meeting.

You can read more about knowledge management in The Electronic Journal of Knowledge Management.

In addition here are the 100 most influential companies in knowledge management right now.


Companies with a larger female presence on their boards have done better during the economic downturn

The latest Credit Suisse Research Institute study analyzed the performance of 2,360 companies around the globe with and without female board members from 2005 onwards.

Between 2005 and 2007, when economic growth was relatively robust, there was little difference in share price performance between companies with or without women on the board. On the other hand, from 2008 onwards, as volatility increased, the companies with female board members outperformed the others. “They tend to perform best when markets are falling, deliver higher average ROEs through the cycle, exhibit less volatility in earnings and typically have lower gearing ratios” write the study authors.

Stocks with greater gender diversity on their boards tend to perform best when markets are falling.

 Possible reasons:

–       companies may more likely to have women on the board when they are larger and more established;

–       diversity increases the performance of all board members. Studies have shown that majority groups improve their own performance in response to minority involvement producing better average outcomes in more diverse environments;

–       more women in the group signals a greater collective intelligence.Collective intelligence of a group is not mostly determined by the average or maximum intelligence of the individuals within the group but could be better explained by the style and type of interaction between the group members;

–       women are the primary consumer decision makers in homes across the world, having women on the board may guide companies to better products and services for the people who spend household money;

–       gender-diverse boards were more likely to focus on clear communication to employees, to prioritize customer satisfaction, and to consider diversity and corporate social responsibility.

A greater number of women on the board improves performance on corporate and social governance metrics.



Cutting-edge services are a prerequisite for economic growth

Today, economic growth of developed countries is driven mostly by services which provide today 2/3 of added value and new employment.

Focus of economic development is strongly shifting from “things” to creating value in services – the importance of product characteristics is shifting to specificity and positive customer relationship.

At a time when competing products and services are comparable in price and quality, which customers are adequately informed,  the purchase decision becomes more and more based on emotions and relationships. This is the reason why the mediocre quality of the customer relationship is no longer enough – winner is the one, who  is capable to surprise positively the client.

Based on Acccenture/an international management consultancy survey, clients are using following parametres to distinguish competitors: brand and reputation 59%, quality of service 50%, smoothness and speed of business 45% confidence, trust 33%. Lower prices were brought up only by 3%.

Paraphrasing Colum Lowe: “Only one company can have the best quality of services, others must compete with the price.”

When developing customer relationship it is critical to have the skills and ability to follow the the customer evolution – various web and mobile self-service solutions, social media, openness and speed of customer communication.

The question is no longer the price or the amount of time spent, but how the customer feels himself and how he is welcomed by the service provider. Received good or bad customer experiences are today more than ever shared through social media. Shared experience becomes often the main reason of final choice.

The main expectation of the client to the service provider is a human relationship.This is exactly the reason to look more closely at the mirror to decide whether the apparent self-image matches also to the client’s vision? Good service means the ability to place ourselves in the customer shoes: relate to your  customers as to your friends, talk to him as to your good colleague.

The worst thing a company can offer to it’s customer, is to make him feel insignificant and stupid.

Companies who see clients as just a mass to create profit get by return just expectations for ongoing discounts.

Service Providers who treat the consumer as equal partner have more loyal customers, even when the prices are higher.



G4S invests in customer service

Press release 06/05/2012

Estonian market leader in security services G4S carries out a comprehensive customer care reform, under which G4S is going to improve existing processes and invest in innovative and more convenient customer service solutions.

Wishing to provide a more flexible customer service and to speed the customer support up G4S introduced in the beginning of June g4s - sdoor15the call distribution system and launched technical support unit. All calls made to number 1911 are now divided by the reason  – so saving the caller and the receiver time and speeding up the security service. The operational goal of the new technical customer support unit is to provide technical advice over the phone. More frequent technical issues could be solved over the phone, when more complex concerns take place – the technician will be sent to the client.

Service reform will also change the security group structure: G4Si is about to add a new unit responsible for customer service, under the leadership of Ene Raja. Ene Raja has international management experience, she has previously worked in senior management of Tele2 Group, being responsible for strategic customer relationship management of 22 European Markets. 2010-2011, she led the Retail Banking division of SEB in Estonia.

G4S Customer Service Division Director Ene Raja said that latest customer satisfaction surveys indicate that security companies are evaluated the most for prompt responsiveness and effective problem resolution: “We want to expand this narrow point of view, and provide more to customers. Experiences received from security company, regardless of the occasion have to be positive, memorable and uplifting customer safety, “said Raja.

By the end of this year it is planned in addition to develop the motivation and career model for employees based on competency and skill and knowledge management program to support technical expertise, 2013-2014 is planned to invest in internet-based customer self-service and analytical CRM software improvements and a staff e-training system. These improvements allow faster, more convenient and valuable customer relationship, better competence levels of G4S employees, in-depth customer knowledge and simpler workflows.

G4S Estonia has repeatedly earned the Estonian Chamber of Commerce and Industry and the Estonian Institute of Economic Research  the title of the most competitive service company. G4S security group has an excellent credit rating (AAA).


Head of communications G4S Julia Garanža